Multnomah County v. Standard Am. Dredging Co.

BENSON, J. 1. The essential controversy between the litigants herein arises from their conflicting views as to the nature of the complaint, and the classification of the cause of action. The defendants insist that the initial pleading states a cause of action in damages for fraud and deceit, while the plaintiff just as earnestly contends that his complaint is founded upon the theory discussed, and the doctrine announced by this court, in the cases of Hayden v. City of Astoria, 74 Or. 525 (145 Pac. 1072); Id., 84 Or. 205 (164 Pac. 729). In the first of these cases, Mr. Justice Bean quotes with approval from 4 Elliott on Contracts, Section 3697, as follows: “Sometimes it happens that the original contract has been deviated from in so many matters that it can hardly be regarded as controlling the parties at all, and in such cases the original contract is often treated as abandoned, and a new contract is'implied to pay the fair or reasonable value of the work or material. * *■ [266] “So, again, in Vermont, ‘where the parties under a special contract deviate from the original plan agreed upon, and the terms of the original contract do not appear to be applicable to the new work, it being beyond what was originally contemplated by the parties, it is undoubtedly to be regarded and treated as work wholly extra, out of the scope of the contract, and may be recovered for as such.’ ” The opinion then cites several Oregon decisions to the effect that “a subsequent departure from the terms of a written contract by the parties, and mutually acquiesced in abrogates the original contract to that extent.” The rules thus enunciated are then expressly applied to the allegations of the con-plaint in that case. The complaint in that case recited the particulars in which the plans and specifications ultimately adopted varied from those upon which the original contract was based, and showed the particulars in which the changes and deviations required other and greater labor and equipment. We find nothing of that sort in the complaint in the case at bar. In the first appeal of Hayden v. Astoria, 74 Or. 525 (145 Pac. 1072), the only question decided by this court was the sufficiency of the complaint, and thereafter upon a trial of the issues made thereon, there was a judgment for the plaintiffs from which the defendant appealed, and, with slight modification, the judgment was affirmed, Mr. Justice McCamant, speaking for the court, saying: “These findings are too lengthy to be incorporated even in substance in this statement of facts. In the main they were in accord with plaintiffs’ contentions and bore out the allegations of the amended complaint. The findings were to the effect that the departures from the contract of August 22, 1911, were so numerous and so substantial as to entitle plaintiffs to recover on a quanturn'meruit.” [267] "We find nothing, however, in either of the opinions above mentioned, which would justify a recovery under the complaint in the instant case, upon proof of deviations from the original contract, for nothing of the kind is alleged. In the present case the trial court adopted the contention of plaintiff, that this case is akin to those of Hayden v. Astoria, 74 Or. 525 (145 Pac. 1072), Id., 84, Or. 205 (164 Pac. 729), and among others, gave these instructions to the jury: “The complaint is based upon reasonable value of work, labor and material performed and supplied. The defense is based upon an alleged contract to perform the work and furnish the materials at certain prices." You are hereby instructed that if the original contract has been deviated from in so many matters that it cannot he regarded as controlling, the alleged original contract may be treated as abandoned, and the plaintiff has a right to recover the fair and reasonable value of the work and labor performed, and materials furnished. “Now, the plaintiff, among other things, alleges fraud. In that connection you are instructed, gentlemen of the jury, that fraud is never presumed. He who alleges it must prove it by clear and convincing evidence. I will state, however, that this action, according to my theory of the case, is not based primarily upon fraud, hut is based upon the reasonable value of the services rendered and materials furnished. Fraud, however, is brought in incidentally, and in that connection you are instructed that it must be proved by clear and convincing evidence. ’ ’ There is not a single allegation in the complaint to justify the theory thus submitted to the jury, and the error involved goes to the substances of the case. 2, 3. In many particulars this case is strikingly similar to that of Sell v. Mississippi River Logging Co., 88 Wis. 581 (60 N. W. 1065). The complaint therein [268] alleged the making of a contract by which plaintiff agreed to drive all of the sawlogs lying in and along the cast fork of the Chippewa River, having the defendant’s mark thereon, for the sum of $1,000; that defendant’s agent represented and guaranteed that the number of such logs (which were then covered by several feet of snow) was, by actual count, 3,700, and no more. It was further alleged that he put the logs into the river, and did not discover, until the drive was neatly completed, that the number of logs so marked was 11,617, requiring an increased crew and additional expense in driving them; that the reasonable value of the labor in driving the logs was $4,000, for which amount judgment was prayed. The court held that while the Complaint was far from commendable in form, it stated a cause of action for fraud and deceit, and not upon contract, and continues thus: “There could be no valid contract until it was ratified with a knowledge of the fraud; and if a party affirms a contract with knowledge of the fraud, he affirms it wholly, but not as a contract made in good faith. He does no.t thereby waive his claim for the damages caused by the fraud. # # We think that his completion of the drive, under such circumstances, was not an affirmance of the contract nor a waiver of his right to damages by reason of the fraud,'and that the contract having been induced by fraud, it is no obstacle to the recovery in this action of his damages, to be measured by what the work was reasonably worth. The complaint states the entire case substantially as made out, and, as the distinctions between forms of action have been abolished, we do not perceive any substantial objection to' the allowance of damages on this basis. ’ ’ 4. The views expressed in the above quotation are in full accord, with reason and justice, and we adopt them in this case. The cause was tried and the jury [269] was instructed upon a theory not justified by the pleadings. This would not entitle the defendants to a judgment of nonsuit, as urged by them, hut they are entitled to a trial upon the issues as joined. The judgment is therefore reversed and the cause remanded for a new trial. Reversed and Remanded. McBride, O. J., and Burnett and Harris, JJ., concur.