Marcum v. Potter

Me. L. D. Smith, Special Judge, delivered the opinion of the Court. R. L. Potter, wlio is complainant in the cross-bill filed in-this cause, on September 25, 1920, purchased from Kirby & Co. two horses at a sale conducted by them under an advertisement at Oneida, Tenn. In payment for the horses Potter issued his check on the bank at Huntsville for $281 and took possession of the horses. The complainant, R. S. Marcum, for the accommodation of Potter, indorsed this check. It was presented by Kirby & Co. to the bank at Oneida and by that bank paid. The horses which Potter purchased were warranted to be halter wise or broken. It turned out that the representation made with respect to these horses was untrue. Potter made an effort to convey the horses to his home by means of haltering them. They were so ivild that one of them injured itself to such extent as that it had to be killed, and the other one fell and broke its neck. Potter, conceiving that the warranty had been breached and that he was not liable to pay for the horses, notified the bank at Huntsville on which the check was drawn not to pay the check. Marcum then brought the original bill in this case, upon the theory that he was liable as an in-dorser on the check against Potter, the drawer of the check and against Kirby & Co., who had obtained the money thereon. [253] Potter in his answer admitted his liability to Marcum, bnt brought a cross-bill against Kirby & Co., setting up that the quality oí the horses which he bought had been misrepresented, and that they had been warranted as halter broke or halter wise, and that this warranty was untrue and breached, and he sought to recover of Kirby & Co. the amount which he paid for the stock. The chancellor and the court of civil appeals very correctly reached the conclusion that the proof showed overwhelmingly that Kirby & Co. had warranted these horses and represented them as being halter broke, when, in truth and fact, they were wild Western, horses, that had never had a halter on them at all. The chancellor gave a decree in Potter’s favor for the full amount paid for the horses. His decree was modified on appeal to the court of civil appeals, that court holding that the measure of damages was the difference in the value of the horses had they been halter broken and their value as they were un-halter broken. -As the proof did not show the amount of the damages on this basis, the cause was remanded in order that a reference might be had to ascertain the amount. The case is before this court at the instance only of Potter, all other parties acquiescing in the decree of the court of civil appeals. Potter complains at the measure of damages applied by the court of civil appeals, and contends that under the facts in this case he sustained a total loss by reason of the misrepresentations and breach of warranty of the Kirbys, and that that constitutes the measure of damages. We agree with the contention made on behalf of Potter. It is provided by our Uniform Sales Law (Pub. Acts 1919, chapter 118, section 69 [6]) that “the measure of damages [254] for breach of warranty is the loss directly, and naturally resulting, in the usual course of events, from the breach of warranty.” Ordinarily, of course, this loss is ascertained by applying the rule of the difference in price of the animal as warranted and the price as delivered. But this rule is not an invariable one. The‘purpose of the rule is to ascertain the true amount of the loss actually and directly sustained. Here these animals were warranted to be halter broken, Avhich, according to the evidence, means that they have been already made accustomed to being haltered and handled with a halter. The purchaser, assuming this to be true, undertook to convey the animals by the use of halters. He accepted the animals with this understanding, and had the right to do so under the representations and warranties made. While attempting to convey the- animals by means of halters, and as he had the right to do, they destroyed themselves by reason of not having the qualities which they were represented to have, and thereby they became an absolute loss, not by reason of any fault of the purchaser, but because he was deceived and misled by the misrepresentations of the seller. In other words, their loss was the result of the existence of conditions against which the seller warranted the animals. The theory of the court of civil appeals and that insisted upon by counsel for Kirby is that, before a purchaser can recover the full value of the animals warranted, he must have offered to rescind or return the property. Of course, a purchaser of property cannot keep the property in a defective condition and also recover the full value; but we do not have such a case to deal with. He had no- opportunity to return the animals or to offer to rescind, and [255] he was not permitted to keep the animals, all of which resulted from facts against which the animals were warranted. We are concluded by the concurrence of the chancellor and the court of civil appeals, not only that there was a breach of warranty in this casé, but express deception practiced. This deception misled the purchaser, and this deceit resulted in the loss of the property entirely, and operated'to prevent the purchaser from offering to return the property or obtaining a rescission of the trade. There was no error in the decree of the chancellor, and it will be in all things affirmed. The decree of the court of civil appeals will therefore be modified, so as to conform to affirmation of the decree of the chancellor. ‘Kirby & Co. will pay ail the costs incident to the appeal and to the proceedings in this court. The costs of the court below will be paid as decreed by the chancellor. Footnotes [*] On profits lost from inability to use horses as element of damages for breach of warranty, see notes in 43 L. R. A. (N. S.), 153 and 49 L. R. A. (N. S.), 576.