Farmers' Equity Exchange v. Blum

Bibdzeli., J. This is an appeal from a judgment in favor of the plaintiff, and from an order denying a motion for a new trial, in an .action brought to. recover damages occasioned by a sale to the plaintiff by the defendant of certain grain, for the conversion of which the plaintiff was subsequently held liable in damages at the suit of one ■Charles H. Stoffel. It appears that Stoffel entered into a contract — 88 — •with one George Doerner, in November, 1910, to sell to him the northeast quarter of section 21, township 136, range 96, upon a combined money consideration and crop payment plan. It was stipulated in the contract that the title to all the grain raised upon the land was to remain in Stoffel until sold, and when sold the proceeds were to be applied to the payment of interest, taxes, and principal. This contract was duly recorded in the office of the register of deeds. Doerner paid some cash, entered into the possession of the land, farmed it from year to year, and turned over the crops or part of them to Stoffel under the contract. This controversy arises over the crop raised in 1914. During this year it appears that Doerner raised 1,415 bushels wheat, part of which was delivered to Stoffel, and the remainder, amounting to some 785 bushels, was disposed of to other parties. It is claimed that the defendant herein obtained some 400 bushels of that portion of the grain that was not delivered to Stoffel, and that he sold the same either as his own or as that of Doerner to the plaintiff, which operates an elevator in New England. In February, 1915, the plaintiff was sued by Stoffel for the conversion of the grain which it had bought of other parties, the title to which had been reserved in Stoffel. The jury returned a verdict in favor of Stoffel for $775, upon which judgment was enteied and later satisfied. This action was brought against Blum as one of the persons who had obtained and sold to the plaintiff a portion of the grain on account of which plaintiff was compelled to pay the judgment in favor of Stoffel. In the court below the action resulted in a verdict against the defendant for $290, and interest, upon which judgment was entered. Upon this appeal appellant relies for reversal upon rulings in regard to the admissibility of evidence and upon the instructions of the trial court to the jury. He also contends that there is no evidence admissible under the pleadings, upon which the verdict of the jury could be predicated. The specific rulings and instructions upon which the errors are predicated will be referred to in the order in which they are discussed in the appellant’s brief. It is claimed that the court ei*red in sustaining an objection to a question directed to Doerner, asking whether or not one Graeber, Stoffel’s agent, had read and explained to him the contract for the sale and purchase of the land at the time it was entered into. The court sustained the objection.on the theory that the judgment in the action by — 89 — Stoffel against the plaintiff was conclusive and binding upon the parties as to the terms of the contract. It matters little whether the trial court gave a correct reason for sustaining the objection to this testimony. The evidence was clearly inadmissible in this ease between strangers to the contract and under the issues framed by the pleadings. It was by virtue'of the terms of that contract that Stoffel was enabled in the former action to recover from his plaintiff. Plaintiff’s title to the grain was disproved in that action, and in this case we are not concerned with the contract for the sale of the land further than to note that its provisions deprived the plaintiff of the grain he had purchased from Blum. Furthermore, the same contract is in evidence in this case, and under its terms the title to the grain was in Stoffel, and could not have been either in Doerner or in his vendee, Blum. The contract cannot be-reformed in this action or made to convey a meaning not warranted by its terms. It appears that Doerner was a witness in the former case,, and he must have known as much about the fraud perpetrated upon him, if any, in inducing him to enter into the contract as he knew at the time of this trial. The most that can be urged against the contract is that it is voidable, not void, and under its terms the title to the grain vested in Stoffel, and would not be devested until the contract were rescinded by Doerner. There is no contention that this was even attempted. Nor could a rescission or reformation be properly decreed as against a good-faith purchaser from Stoffel; and this plaintiff, having paid to Stoffel a judgment based upon the value of the goods, occupies as favorable a position as though a purchaser of the goods from Stoffel. Plaintiff’s good faith in the transaction is not questioned. It is next contended that the court erred in admitting in evidence the record of the Stoffel-Doerner contract, without first requiring the-plaintiff to account for the nonproduction of the original contract. In this connection appellants rely upon the ease of American Mortg. Co. v. Mouse River Live Stock Co. 10 N. D. 290, 86 N. W. 965, and other-eases adhering to a similar rule. The decision of this question in the-case of American Mortg. Co. v. Mouse River Live Stock Co., supra, was based upon statutory provisions entirely different from those now governing the question. That decision was based upon § 5696 of the Revised Codes of 1899, which provided expressly that the record of a. — 90 — recorded instrument, or a duly authenticated copy of the record, may be read in evidence with like effect as the original, “on proof, by affidavit or otherwise, that the original is not in the possession or under the control of the parly producing such record or copy.” Section 3597, Comp. Laws 18S9, also provided expressly that the recording of an instrument did not entitle the instrument “or record thereof, or the transcript of the record, to be read in evidence.” Section 5696, Revised Codes of 1899, is still in force as § 7916, Comp. Laws 1913, but § 3597 was amended in 1901 (Sess. Laws 1901, chap. 145), so that it now reads as follows (Comp. Laws 1913, § 5597) : “The recording and deposit of an instrument approved and certified according to the provisions of §§ 5549, 5569, 5570, 5571, and 5572 are constructive notice of the execution of such instrument to all purchasers and encumbrancers subsequent to the recording; and all instruments entitled to record, the record thereof, or a duly certified transcript of such record, or copy of .such instrument, shall be admissible in evidence in all the courts of this slate, and may be read in evidence without further proof.” It requires no argument to demonstrate that the record of an instrument entitled to be recorded, and which is recorded, is admissible in evidence under the above section without further proof, and that the rule in the case •of American Mortg. Co. v. Mouse River Live Stock Co. is to that •extent altered by legislation. It is next contended that the court erred in striking out certain testimony of Doerner, relating to his understanding of the contract between him and Stoffel. This testimony was properly stricken out, as, in this •case, we are only concerned with the contractual relations between Doerner and Stoffel to the extent that they afforded the occasion for the judgment against the plaintiff which deprived it of the benefit of the property it had obtained from Blum. If this action were between Doerner and Stoffel, and issues were involved looking toward a reformation or cancelation of the contract, other considerations would enter in and the rule invoked by the appellant here would be applicable. The appellant complains of the instructions of the trial court wherein the court instructed the jury that the action was in the nature of an .action for the recovery of money bad and received in payment for certain grain defendant sold to the Farmers’ Elevator Company, and to which grain ho had no title. Also wherein the trial court told the jury — 91 — in substance that tbe judgment in the previous action of Stoffel against the elevator company was a binding adjudication of the rights of the parties under the Stoffel-Doerner contract, and that it determined Stoffel’s ownership of the grain. It is true that the complaint seems to have been drawn upon the theory of deceit, rather than upon the theory of implied contract, but the complaint is nevertheless sufficient to apprise the defendant of the exact nature of the claim made, and the defendant is in no position to complain of an. instruction that ignores the theory of deceit and limits the plaintiff’s recovery to the amount actually paid out by the plaintiff to the defendant for grain sold to it by the defendant and which was grown upon the Stoffel land. As to that portion of the instruction which embodies a reference to the adjudication in the Stoffel action against this plaintiff, little need be said in addition to what has been stated heretofore in this opinion. While it is true that Blum was not a party to that judgment, and is not bound by it in so far as it imposes liability, the judgment was nevertheless admissible as heretofore pointed out. No prejudice could have resulted from this instruction, as, under the terms of the contract which Blum is not in a position to dispute for the reasons hereinbefore set forth, the jury could not have done otherwise than to have found the title in Stoffel. It is also contended that there is no evidence supporting the verdict of $290.10 against Peter Blum, but that, on the contrary, the evidence establishes conclusively that Peter Blum received but $120.10 in payment of three loads of the six, upon which the verdict is based. The evidence of Van Burgen, the elevator, man, is to the effect that the scale tickets were made out to the order of Peter Blum, but that when Blum came in for his check Van Burgen told him that, inasmuch as there was some controversy about the ownership of the grain, he would draw a check in favor of Doerner, and that Blum could get Doerner to indorse the check; that he asked Blum if that would be all right, to which Blum replied in the affirmative. The circumstances of the sale were fully presented to the jury, and, from all the facts and circumstances surrounding the transaction, we believe the jury were warranted in finding that Blum sold the grain as his own, and merely consented that the check should be drawn in favor of Doerner. A careful perusal of the affidavits submitted in support of the mo — 92 — tion for a new trial convinces us that the trial court did not err in denying a new trial. After considering all of the assignments of error which were argued in appellant’s brief, we are convinced that the judgment is. correct and should be affirmed. It is so ordered. Grace, J. I dissent.