Barker v. Lack

Hart, J. J. O. Barker instituted this action in tfie chancery court against R. A. Lack to obtain specific performance of a contract for the sale of a stock of goods. Tfie complaint alleged in substance tfiat tfie plaintiff had entered into a written contract with tfie defendant for tfie sale of a stock of goods and tfiat tfie defendant as part payment therefor had agreed to sell to tfie plaintiff ninety-eight shares of stock in a mercantile corporation; that tfie defendant had been placed in possession of tfie stock of goods sold to him and had later abandoned possession of it; and tfiat fie had failed to perform tfie contract on bis part. Tfie prayer of tfie complaint was for specific performance of tfie contract and for tfie appointment of a receiver to take charge of tfie stock of goods abandoned by tfie defendant and for an injunction restraining tfie defendant from disposing of tfie stock in the mercantile corporation. Tfie defendant admitted tfie execution of tfie contract and as a defense to tfie action set up false representations in tfie procurement of tfie contract. Tfie chancellor found tfie issue in favor of tfie defendant and tfie plaintiff fias appealed. Both tfie defendant and fiis son testified in tfie case. They testified tfiat tfie plaintiff represented to tfie defendant as an inducement to get him to purchase tfie stock of goods tfiat tfie goods would not invoice more than five thousand dollars and tfiat the indebtedness would not be more than fifteen hundred dollars or two thousand dollars; tfiat tfie defendant, believing these representations to be true, entered into tfie contract for tfie purchase nf tfie stock of goods and agreed tu pay therefor tfie wholesale invoice price >and tfie cost of tfie fixtures, less $75; that in payment of the purchase price tfie buyer assumed tfie indebtedness of tfie seller 'and also agreed to sell to 'him ninety-eight shares of stock in a mercantile company of the par value of $25 each; that the contract further provided that whatever differences there might be in the settlement should be settled by the party found tobe indebted giving his. promissory note to the other payable twelve months after date; that the stock in the mercantile company was worth $2000; that the stock of goods inventoried something over $7000 and that the indebtedness amounted to a little more than $3900; that the plaintiff refused to deliver the invoices to the defendant but admitted that the invoices, as far as made, amounted to more than $7000 and the indebtedness to a little more than $3900; that at the request of the plaintiff they took possession of the stock of goods and began to sell the same as soon as the contract of sale had been executed; that the defendant remained in possession of the stock of goods for eight or ten days selling the same in the usual course of business; that when he learned that the representations made by the plaintiff were false he offered to return the stock of goods to the plaintiff and the amount of money he had received for cash sales and agreed to account to the plaintiff for the credit sales; that demand was made of- the plaintiff during the progress of making the inventory for the original invoices -and that the plaintiff refused to deliver them to him. Other testimony -was introduced by the defendant which tended in some measure to corroborate his testimony and that of his son. The plaintiff testified in his own behalf and flatly contradicted the defendant. He testified that he only gave his opinion to the defendant as to the amount the goods would inventory -and as to the amount of the indebtedness, iand that the 'defendant so understood it; that he made the representations in good faith and'that the contract embodied the whole agreement between the parties, and that it was not understood by the defendant that the plaintiff had made the representations to the defendant as to the amount that the goods would invenitory or as to the amount of indebtedness .as matters of inducement to the defendant to purchase the stock of goods. The testimony of the plaintiff was corroborated to some extent by that of other witnesses. The chancellor found the issues as ito the false representations in behalf of the defendant and we cannot say that his finding is .against the preponderance of the evidence. It is the settled rule of this court that findings of fact miade by a chancellor will not be .disturbed on (appeal unless they are against the clear preponderance of the evidence. It is contended, however, by counsel for the plaintiff that the written contract expresses the agreement between the parties .and that parol evidence is inadmissible to vary, qualify nr contradict, to add to or subtract from, the absolute terms of a valid written contract-containing no ambiguity. Though this is the settled rule in this State, there are certain limitations to the rule and one is that an action of deceit based on fraud in the procurement of a contract, not being an action to enforce the contract, parol evidence of the fraud is /admissible, notwithstanding the fact that the contract is in writing. 20 Cyc. 112. In the case of Hanger et al. v. Evins & Shinn, 38 Ark. 334, the court held that an intentionally false and misleading representation which induced the contract .to the other’s injury is ia tort outside of the contract /and is provable by parol. To the same effect see Delaney v. Jackson, 95 Ark. 131. It follows that the decree must be affirmed.