M. B. Haas & Co. v. Fenlon

The opinion of the court was delivered by Kingman, O. J.: On the 27th of March, 1866, Fenlon and M. B. Haas entered into a written agreement, that if the said Haas could procure the appointment of post-sutler at Fort Leavenworth Fenlon was to sell him all his stock in trade and goods of every description, in the building occupied by Fenlon as sutler at Fort Leavenworth, at the cost-price thereof, to be ascertained by the invoices of Fenlon, and also to sell him his buildings occupied as sutler’s store, and his dwelling-house at Fort Leavenworth, at a price to be agreed upon by the parties, and if they could not agree on the price of the buildings, it was to be fixed by arbitrators. For this property Haas agreed to pay in cash and in indorsed notes — -the cash to be deposited on the morning of the 28th of March 1866. In case Haas was not appointed sutler the agreement was to be void. On the 31st of March this executory contract, which was entered into by Haas for Haas & Co., was carried out; the goods and buildings were invoiced, and the sum of $18,000 in cash was paid, and notes given for the residue. On the 30th of March Fenlon delivered to Haas a paper of which the following is a copy: Head-Quarters, Fort Leavenworth, Kansas, March 30th, 1866. Special Orders No. 51. Extract. I. Mr. E. Fenlon having tendered his resignation as post sutler, it is hereby accepted to take effect this date. II. The sutlership oi the post having become vacant, upon [605] the recommendation of the council of administration Mr. M. B. Haas, of Leavenworth City, is appointed sutler, subject to the approval of the Secretary of War. By order of Lieut. Colonel Geo. Sykes Chas. S. Newlon, 1st Lieut. 13th Infty., Post Adjutant. A true copy: Chas. tí. Newlon, 1st Lieut. 13th Infty., Post Adjt. In “ ten or twelve days ” after Haas had taken possession of the goods and buildings he was turned out of possession of the buildings at Port Leavenworth, having been ordered off by the authorities. And this action is brought to recover $25,000 damages sustained by the plaintiffs for the false representations made by Eenlon to induce plaintiffs to make the contract above stated, and for false invoices on the stock of goods. The petition in form states but one cause of action. The false representations of Eenlon as to the appointment of Haas as sutler, and the false invoices, are all interwoven with each other, and with many other statements, as parts of transactions growing out of the contract of the 27th of March, and from all oí which damage to plaintiffs arose. Among other statements this is found: “ And the defendant further contriving and intending, to cheat and defraud the plaintiffs, and to induce them to purchase the said stock in trade, goods, and buildings of and from the defendant, lie the defendant then and there falsely and fraudulently represented to the plaintiffs that he was the post-sutler at Port Leavenworth aforesaid, and that he was the lawful owner of the said stock in trade, goods, and buildings, and had a good and lawful right to sell and convey the same to the plaintiffs; that'his only object in making said sale was that he intended to take a trip to Europe for the benefit of the health of his wife and family, and that M. B. Haas, one of the plaintiffs could and would procure the appointment of post-sutler at Port Leavenworth aforesaid.” On these representations the petition represents that the contract of March 27th was made. This contract was made part of the petition. The substance of it has been already stated. Upon the presentation of the order of the post commander heretofore noticed the contract was concluded. Haas states in his testimony that the. presentation of [606] this order was accompanied by, representations of Eenlon that it was all tbe appointment he needed. Upon tbe trial tbe defendant objected to all evidence tending to show false representations by Eenlon as to tbe appointment of Haas to tbe place of sutler as an inducement for plaintiffs to purchase tbe stock of goods, buildings, etc., and all evidence intended to show damages to plaintiffs by reason of Haas not retaining tbe position, or not receiving tbe appointment, and representations made by Fenlon to Haas that tbe appointment made by tbe commander at tbe fort was all tbe appointment that was required. Tbe court sustained tbe objections, and tbis ruling in a great number of instances is complained of in tbis court as error. Tbe court also in its charge confined tbe jury to an inquiry as to tbe damages arising from tbe invoicing of tbe goods at a higher price than tbe cost thereof. In these rulings we think tbe court was correct. Tbe evidence did not tend to prove any cause of action for which tbe plaintiffs could recover in tbis case, or in any case. Any evidence that tended to show that Fenlon undertook to procure or aid in procuring tbe appointment of Haas to tbe place of sutler as an inducement to tbe plaintiffs to buy of defendants, and anyrepresontatiouis made by Fenlon of bis power to influence such an appointment, or secure its enjoyment by Haas, or in any way promote or effect such a result, however much confidence tbe plaintiffs may have bad therein and relied upon in making such purchase, could not be tbe basis of a recovery. No matter bow false tbe representations might have been, nor bow much the plaintiffs were damaged by confiding in such representations or promises, they cannot recover for tbe injury. All contracts that embrace stipulations, or are based upon an understanding, that one party is to exert bis influence upon tbe appointment of a public officer, or upon tbe decision of questions affecting prrblic rights, with a view to other considerations therefor than tbe public good, are contrary to public policy, and so inoperative and void: Fuller v. Dame, 18 Pickering, 472; Battle v. Nutt, 4 Peters, 184; Gray v. Hook, 4 N. Y., 449; Nichols v. Mudgett, 32 Vermont, 546; Meacham v. Dow, [607] id., 721; Tool Co. v. Norris, 2 Wallace, 45. Mr. Fenlon had an undoubted right to use his influence to procure the appointment of sutler for Mr. Haas; but he had no right to urge such an appointment from any other motive than the public good. He had no right to accept, nor Messrs. Haas to offer, any. inducement to use his influence in the appointment, because such consideration placed Mr. Fenlon under wrong influences, and offered him a temptation to do that which might injuriously affect the public interest. Nor is the character of the transaction in any way changed because the inducement was an advantageous contract instead of money. Either comes within the rule, and is equally obnoxious. "While the law will not hear the parties to such a contract, neither can it entertain causes of action embracing negotiations leading to such a contract, as representations falsely made to bring it about. The law leaves the parties to such a transaction where it found them, and will not attempt to adjust the rights between them. If one party has suffered by the bad faith of another in such a case he has no redress in the courts. It is precisely such a prohibited contract that, so far as the sutlership was an inducement thereto, was the moving cause of the representations the injurious falsity of which is one of the grounds of action in this case, and to establish which the rejected testimony was offered. It is true that the questions were skillfully framed so as to avoid, as far as possible the objection on this ground; and some of them taken singly may not be open to this objection; but such questions were not relevant to the only issue that could be tried, and if not obnoxious on the ground that they were intended to elicit proof of an illegal contract, or representations that led to one, still that were properly excluded as not pertinent ,to any other issue. This conclusion disposes of the main point in the case. Other errors are alleged, only one of which we deem it necessary to notice. The answer, except as to the execution of the written contract, was a general denial. The defendant under this answer was permitted to introduce evidence tending to prove that at the time the purchase was completed $300 or [608] $400 of the purchase money was “ thrown off” the cost prices of the goods by Eenlon, and that afterwards $3,000 of one of the notes given by Haas & Go. for the goods was also remitted by Eenlon. There was evidence to show for what purpose this .was done, and although it was uncertain, it was enough for the jury to infer that the first sum, and possibly the last, was thrown off to cover mistakes generally in the invoice. It is conceded that this evidence was not admissible to prove an accord and satisfaction, a payment, or set-off, or a counterclaim; but it was certainly admissible so far as it was shown that the sums were thrown off or remitted to cover any mistakes in the invoice, and that such was the purpose for which it was done, by an understanding of the parties at the time. Supposing it had been established that the amount of the cost as footed up was $200 too much: could not the defendant show under a general denial that $300 had been deducted from the amount by an understanding that it was to cover such a result? Such testimony only showed what the goods really sold for, and was in no legal sense a set-off. And to this extent the evidence was admissible, and to this point and this only was it carefully confined by the instructions of the court. The judgment is affirmed. Yalentine, J., concurring.