Bond v. Clark

Peck, J. The question principally discussed in this case is, whether, upon the facts reported by the. referees, the plaintiffs are entitled to recover. It appears by the report, in connection * with the written assignment or transfer from' the defendant to the plaintiffs, that on the 19th June, 1849, letters patent were granted to Samuel P. Francisco for certain improvements in atmospheric churns ; that at the time of the sale in question the defendant owned the right under that patent for the state of Vermont; that on the tenth day of July, 1854, the defendant sold his right for the county of Orange, and made a written transfer of it to the plaintiffs, by an instrument, a copy of which is annexed to the report. No question is made as to the validity of the patent, or as to the defendant’s titie. The referees find that at the time of the sale in the negotiation, “ the defendant made extravagant representations of the superiority of this churn to all others in use, that it was a valuable and useful [580] invention, that it was in great demand, and fast coming into, general use ;” that these representations were made verbally, as well as by a printed circular', annexed to the report. On looking at this circular we find various representations of the comparative excellencies of this churn, and its superiority over all others ; some' of. which are of rather a general character. Perhaps the most prominent and pointed among these representations, found to be untrue, is the one in these words : “ This scientific churn has not an equal for making and gathering butter in quality or time, as we can make hard and sweet butter in one-eighth of the time usually spent in churning.” There is also a representation as to its having taken the premium at various agricultural fairs, which for aught that appears was true. The referees find that all the representations as to the qualities and utility of the churn were false, and that it was not in great demand and coming into general use, and that the same is and was of no value ; that prior to the purchase, “ neither of the plaintiffs had seen, or were permitted to see the operation of the churn, except upon water,” and that the plaintiffs made the purchase relying on the representations of the defendant. No warranty by the defendant appears, unless such is the necessary legal effect of the representations. It is claimed by the plaintiffs’ counsel that such is the legal effect. But a simple affirmation is not a warranty, unless it is so intended and understood by the parties, and whether such was the intent and understanding is a fact to be found by the triers of the facts. Where an affirmation is so found to have been mutually understood by the buyer and seller as a warranty, it is a part of the contract, a binding engagement, which obliges the seller to make it good, whether he did or did not know that it was untrue. But if not understood at the time by the parties as a warranty, it is no part of the contraot, although it may have been one of the inducements that influenced the purchaser to enter into the contract. In s.uch case the seller is not liable merely from the fact that the representation- is false, as in case of a warranty he- would be, but it must, also be shown that the seller knew it to be false. The sense in which the affirmation is understood by the parties is therefore very material to their rights, as on, that, ip the [581] absence of fraud, depends the liability of the seller, when the representation turns out to have been untrue. Before the court can pronounce a simple affirmation a warranty, it must be found by the triers of fact that it was so understood by the parties. This principle was recognized in Beeman v. Buck, 3 Vt. 53, and expressly so decided in Foster v. The Estate of Cadwell, 18 Vt. 176. In that case the proof was that at the time of the sale the seller was enquired of by the plaintiff if the sheep were sound and free from the foot rot, and he replied, “ they are sound and free from the foot rot.” There was nothing in the case in any way qualifying this explicit representation. The county court charged the juiy that if they found the representation as the witness testified, it would amount to a warranty. The supreme court reversed the judgment, on the ground that the representation was not in legal effect a warranty; and held that it should have been left to the jury to find whether the parties mutually understood it as a warranty, and also held that unless the jury so found, it was not a warranty, and would not make the defendant liable, unless he knew at the time of the sale that the representation was false. Jones v. Bright, 5 Bing. 533, (15 Eng. Com. L. 529,) is cited by the plaintiffs’ counsel to show that the representations in this case amount to a warranty, or that a warranty is implied. That ’case, as to some of the principles therein laid down, has been ■questioned in subsequent cases. But that case differs from this, and is not an authority to the extent claimed. In that case the plaintiff applied to the defendant, aud informed him he was in want of some copper to sheathe a vessel, and the defendant replied, “ I will supply you well.” The copper was not then examined, selected, or delivered, nor does it appear that the plaintiff saw it. It was afterwards taken by the plaintiff’s shipbuilder. The contract was an executory contract, and not a sale ■on inspection at the time of the alleged warranty. Besides, the declaration alleged, and so was the proof, that the defendant was a manufacturer of the article. Some of the court held that there was an express warranty, but the case turned mainly on the distinction between a mere seller, and a manufacturer of an ■article, who sells his town manufacture, the court holding that [582] in case of the latter there was an implied warranty that the article manufactured and sold by him was fit for the use for which he knew it was purchased. The case at bar is not the case of the sale of an article manufactured by the seller, it is the sale of a right to- manufacture an article under a patent. Nor is the seller the patentee ; he sells a right which he has purchased. It is impossible to put the case at bar upon the ground of an express warranty. In addition to the reasons already given, the contract is in writing, containing no warranty, and the written contract excludes parol proof of a warranty. If any authority need be referred to for this proposition, Reed v. Wood, 9 Vt. 285, is a strong case illustrative of the principle. In that ease it was decided that a common bill of sale excluded parol proof of a warranty. That -was the sale of some hides in a package, lashed together with a rope. The proof was that the seller would not allow the package to be opened, but represented it to be a lot of good hides, and that the purchaser, upon being assured they were good, concluded to take' them ; and that the hides, on being opened afterwards, turned out to have been so injured at the time of sale as to be worthless. The court held that the bill of sale excluded the parol- evidence to prove a warranty, and said that the evidence had no tendency to show fraud or deceit. For both reasons the plaintiff ean not recover in this case upon the ground of a warranty, first, because the facts reported-do not amount in law to’ a warranty, and secondly,- because it is not competent to add a warranty by parol evidence to the written contract. 2. The action ean not be sustained on the ground of fraud. There is no finding by the referees that the defendant knew that his representations were false. For aught that appears the defendant made the representations in good faith, believing them to be true. It is urged that the report finds that the plaintiffs relied on the representations, supposing them to be true. This is necessary in all cases, in order to sustain an action for fraudulent representations; but it is not enough ; it must also appear that the seller knew the representations to be false. It is insisted [583] that the statement in the report that “ neither of the plaintiffs had seeu, or were permitted to see, the operation of the churn-, except upon water,” is sufficient to show fraud. It is true that if the defendant- used any art or contrivance to prevent the plaintiffs from testing the truth of the defendant’s representations, it would tend to show fraud, as it would tend to show that he knew his affirmations were false. But even if we could infer from this statement of the referees that the defendant resorted to' some means to prevent the plaintiffs from further testing the churn, it would be but evidence of fraud, but by no means conclusive ; and if the referees could not find the scienter with all the evidence and circumstances before them, it would be dangerous for the court to infer it from this naked general statement. It is not so strong evidence of fraud as existed in Reed v. Wood, above referred to, in which it appeared the seller refused to have the package of hides opened ; and in that case the court- say the evidence had no tendency to show fraud. In this case it is enough to Say that What is found by the referees is not sufficient to constitute fraud in law, or to warrant the court in inferring fraud. As the case shows neither a warranty nor fraud in the sale, the judgment of the county court is reversed, and judgment ¡rendered for the defendant.