Palmer v. Goldberg

MaRshaíl, J. For a first reason why the judgment is erroneous, it is contended that the action on the note is inconsistent with this one, and, therefore, the election to prosecute the former created a bar to the latter. • The first action was-in affirmance of the contract; this action is, likewise. It is to-recover damages caused by the execution of the alleged and found conspiracy to induce plaintiff to take a worthless $500-note in exchange for his horses.. We are referred to the test of consistency between two actions given in Barth v. Loeffelholtz, 108 Wis. 562, 84 N. W. 846, namely: “Can the facts-necessary to support one remedy coincide with the facts necessary to support the other ?” That does not mean: Are all" the facts necessary to support one remedy necessary to support the other ? but it means this: Are the facts necessary to-support one remedy consistent with those necessary to support tbe other? Frequently illustrations of the rule are given, as they are in the cited case, as for instance, one may sue for-conversion where the facts warrant it, or waive the tort and sue on implied contract. The former suggests unlawful withholding of property; the latter, the contrary. A person may sue on-a contract, voidable for fraud, or sue for a rescission on the ground of fraud and for an incidental recovery of the-subject of the transaction, or merely sue for such recovery on-the theory of a previous rescission. The former suggests continuation of the contract and acquiescence in the fraud;the latter remedies, repudiation thereof. One of the atti [108] tudes is obviously inconsistent with the other, therefore the assumption of either creates an estoppel or, rather, a waiver of the other. In this case we are unable to see that the attitude of' respondent in the action on the note is at all inconsistent with his attitude in claiming damages for the fraudulent conspiracy resulting in his taking the note in exchange for the horses. In the first the sale of the horses and the taking of the note were ratified. The same is true in the second action. No purpose was evidenced in the first action, nor is any in the second, to repudiate the contract of sale. The horses, from first to last, were treated as having passed irrecoverably from respondent’s control, and the note as having become his property for what it was worth. The matter complained of in this action is that the note, when taken, was worthless, whereby, and on account of the fraud of the appellant and his associates, respondent lost his horses valued at $500. Considerable significance is claimed for the circumstance that, by the prayer for relief, respondent indicated a purpose to recover the value of the horses instead of the difference between such value and that of the note. We see no serious inconsistency therein. The purpose of the pleader, plainly, was to claim the damages caused by the fraud. According to the facts stated, that is the value of the horses, since the note had no value whatever at the time it was taken. It was suggested, there is no basis for the finding as to the value of the horses, as there is no evidence on that question. Counsel' evidently overlooked the fact that it was stipulated in the case, as and for respondent’s testimony, that he would testify that the horses were worth $500, and that he was as •competent to give opinion evidence in respect to the matter as farmers generally are. Ordinarily a farmer is held to be competent to give opinion evidence as regards the value of such horses as he owns. The stipulation put some evidence in the record independently of the actual sale of the horses [109] for $500, so it cannot be said that there is no evidence to support the jury’s finding. It is further contended that there is no evidence to support the finding that the appellant and his associates combined to defraud respondent, or that the representations made to him were pursuant to any such combination, or that such representations were false. There is no- need, it seems, to discuss, in detail, the matters referred to in the argument of counsel on these points. They, it seems, failed.to appreciate that the only false representations upon which the case stands are contained in the letters, which there is no dispute but what appellant wrote. They hardly bear any other reasonable interpretation than one calculated to create a conviction in the mind of respondent that Bain was a man of reputed integrity and responsibility, and that no one need hesitate to take his note for $500 in exchange for property of that value. There was undisputed reliable evidence that the very opposite was the truth; that at the time the note was given Bain was regarded unfavorably, rather than favorably, as to honesty and responsibility. The evidence in that regard was given, as it appears, by a man of considerable significance in the community where the respondent had a right to expect Bain was known. He testified to having had occasion to know whereof he spoke, and that he had knowledge in respect to the matter. It is suggested by counsel that the evidence was given as regards the reputation -of Bain in Marshfield, whereas the case shows he lived in Unity. We are unable to find the .evidence that he so resided. The case on the whole shows that he was quite likely to have been as well known in Marshfield as anywhere. Furthermore, the witness, as has been indicated, testified that he had occasion to know the character of Bain, indicating that he had either made investigations in respect to. his character and responsibility for some particular purpose, or had transactions with him or with others where such character and responsibility were involved [110] ■and thereby brought to his attention. The evidence of this witness was not met in any way. Appellant’s counsel did not •even cross-examine him. No evidence’ whatever was offered •on behalf of appellant in regard to Bain’s reputation or responsibility. Bain was sworn as a witness, yet he was not •even asked as to his place of residence. No question was put to him, or to any witness in- appellant’s behalf, in regard to his standing as a business man at the time the note was given, nor did he defend against the claim made against him. So far as he was concerned the cause was permitted to go by. default. It is difficult to see how the jury, under the circumstances, could have come to any other conclusion than they did. We will not take time to further discuss the evidence. In our judgment there was sufficient to support each of the findings. Complaint is made that the court refused to submit a question covering the subject of whether the representations made were false. In our view there was no such refusal as to the false representations contained in the letters upon which the •case rests. They were to the effect that Bain was a man of known honesty and responsibility. The jury were asked to find specially whether that was true or not, and did so find in favor of the respondent. It does not seem that there is any suggestion in the brief •of appellant’s counsel, not heretofore referred to, which calls for special mention. There was no choice made between two inconsistent remedies. An action to recover on a contract, and one to recover damages for having been induced to enter into the contract, are not inconsistent with each other; both leave the contract undisturb able. The jury, on evidence proper for their consideration, found all the facts in respondent’s favor essential to a cause of action for damages caused by an executed conspiracy to defraud: (1) The combination to injure; (2) representations in furtherance thereof to induce respondent to part with his horses in exchange for the [111] promissory note of Bain; (3) the falsity of such representations ; (4) the reasonable reliance thereon as true in parting with the horses in exchange for the note; (5) the injury. The jury went further and found that'when the representations were made they were not only untrue, but that appellant knew that fact or ought to hare known it, and did not believe them himself. The latter elements were not essential. McNaughton v. Conklings, 9 Wis. 316; Tobey v. McAllister, 9 Wis. 463; Mann v. Stowell, 3 Pin. 220; Beetle v. Anderson, 98 Wis. 5, 73 N. W. 560; Hart v. Moulton, 104 Wis. 349, 80 N. W. 599; Krause v. Busacker, 105 wis. 350, 81 N. W. 406; Zunker v. Kuehn, 113 Wis. 421, 88 N. W. 605; Matteson v. Rice, 116 Wis. 328, 92 N. W. 1109; Kaiser v. Nummerdor, 120 Wis. 234, 97 N. W. 932; Standard Mfg. Co. v. Slot, 121 Wis. 14, 98 N. W. 923. It is often said that it is sufficient as to the element of fraud in an action for. damages on the ground of fraud, that the . wrong-doer “knew or ought to have known” of the falsity of his representation. That is somewhat misleading. The element of “ought to have known” has reference merely to the idea that no one should make, in contractual negotiations, representations of fact to induce another to act so that injury might result to him in case of the representations being untrue, unless he knows whereof he speaks. So he is in law held as an indemnitor for the damages caused by his conduct, regardless of whether he knew, or .in the exercise of ordinary care might have known, the truth of - the matter. The duty to know in such a case is positive; nothing can excuse it. By the Gowrt. — The judgment is affirmed. Oassoday, O. J., took no part.