Chu Pawn v. Irwin

O’BBTEN, J. This action was brought to recover certain moneys obtained by the defendant from the plaintiffs, in a fiduciary capacity, upon statements that the money was to be used to pay customhouse duties, etc. The answer admitted the receipt of the various sums, except one small item, but claimed that the defendant had disbursed more than the amount credited in the complaint, and also set up affirmatively a cause of action against the plaintiffs upon a written contract, by the terms of which, among others, the defendant was to receive 30 per cent, upon all reductions in duties and money saved on duties through any compromise with the government, and that such sums so earned under the written contract, after deducting what had been paid him, would leave the plaintiffs indebted to the defendant. In their reply the plaintiffs denied “that they ever signed the document or contract,” and alleged “that they never knowingly signed said contract, knowing or agreeing to ithe matters therein stated.” At the trial the parties entered into a stipulation, as follows: “It is agreed that the only question to be tried in this case is the question as to whether there is a contract between the plaintiffs and the defendant, as alleged by the defendant, and that, in case the jury shall find there was no such contract, the court can direct a verdict for such amount as is proper. The court is to submit the one special fact to the jury; and, in case the jury find there was such a contract, then counsel consent that the amount to be allowed to the defendant under the contract can be ascertained either by a reference, or in such other way as the court may direct” The contract signed by the plaintiffs was admitted in evidence, and the whole force of the plaintiffs’ testimony was directed to showing that, through misrepresentation and fraud, plaintiffs’ signatures were obtained thereto. And the trial judge, in submitting the question to the jury, thus presented it: “Did the plaintiff Chu Pawn sign the name of Yoe Long & Co. to this contract, knowing what was in it, and understanding that it was a contract between the plaintiffs and the defendant?” From this it will be seen that whether a contract did or did not exist was not the issue as finally presented, but whether a contract concededly in existence had or had not been obtained by fraud. Upon the pleadings, the issue of fraud was not tendered, nor did the stipulation embrace such issue of fraud, or include any inquiry beyond the simple one as to whether there was or was not a contract between the parties. The reply, after denying that the plaintiffs signed such contract, alleges that they never knowingly did so, knowing or agreeing to it: This latter is equivalent to a statement that they did not know what the paper signed by them contained, and that they did not sign it intending to agree to it. This, under the decisions, is no defense; the law holding that parties are bound, although not knowing or intending to agree to the terms, or, as stated in Upton v. Tribilcock, 91 U. S. 45-50: “It will not do for a man to enter into a contract, and, when called upon to respond to its obligations, to say that he did not read it when he signed [726] It, or did not know what it contained. If this were permitted, contracts would not be worth the paper on which they are written. But such is not the law. A contractor must stand by the words of his contract, and, if he will not read what he signs, he alone is responsible for his omission.” And the conditions entitling one to relief from a written contract are thus stated in Bryce v. Insurance Co., 55 N. Y. 240: “It must be the mistake of one party, by which his intentions have failed of correct expression, and there must be fraud in the other party.” It will thus be seen that the real issue upon the contract was as to whether it had an existence or not. Though the defendant endeavored to hold the proof down to this issue, the plaintiffs were permitted to introduce evidence tending to show that the contract was procured by fraudulent representations or acts; and it was as the result of such testimony that the jury found upon the question submitted to them by the court, not against the existence of the contract, which was conceded, but against its validity. It is for errors committed in permitting evidence of fraud to be introduced over defendant’s objections and exceptions, and to the refusals to confine the evidence and the charge of the court to the only issue made by the pleadings and the stipulation of the parties, that the defendant asks for a reversal of the judgment. Such exceptions, we think, for the reasons stated, are good. The judgment must be reversed, and a new trial ordered, with costs to appellant to abide event. All concur.