Case ID: ny-st-rep_52/html/0507-01.html
Source: Caselaw Access Project
Author: {"author": "Freedman, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

William P. Roome et al., App'lts, v. Frederick C. Jennings et al., Resp'ts.
    
      (New York Superior Court, General Term,
    
    
      Filed May 1, 1893.)
    
    1. Pleading—Factors—Breach of duty.
    The complaint alleged that defendants, who were employed to sell goods for plaiutiffs, fraudulently represented that they had a purchaser, whose name they did not disclose, and that they were not principals ; that upon inquiry being made for the purpose of delivery, defendants stated that they were the purchasers, and demanded' the goods, which plaintiffs refused to deliver and rescinded the contract; that the price of the goods had declined to plaintiffs’ damage. Held, that the complaint did not stale a cause of action for fraud and deceit, as the damage was not caused by the fraud which induced the making of the contract, but from plaintiffs’ rescission thereof; that they had but a technical cause of action for defendants’ breach of duty, and were entitled to nominal damages only.
    3. Same—Demurrer—Award of damages.
    Upon overruling a demurrer to the complaint, where the damages on the facts stated in the complaint are, as matter of law, merely nominal, the court may proceed to award the damages at once.
    Appeal by plaintiffs from judgment awarding to them the sum of six cents damages, with costs to the defendants.
    The complaint, after alleging the copartnership of the plaintiffs and defendants, set out that, on February 2, 1891, the plaintiffs were the owners of 3,876 half chests of Congo teas, and that on that day, the defendants, who were employed to sell the teas, “for the purpose of getting control and possession of the same, falsely and fraudulently represented and stated to the plaintiffs that they had obtained a purchaser therefor, whose name they did not disclose,” and that they, the defendants, were not interested as principals, meaning thereby as purchasers, in the purchase of said teas, nor in any other manner than as brokers. That the statement was false, and was known to be false by the defendants, and that the plaintiffs relied upon the statement and made an executory contract to sell the teas to “ Mr. Cash ” at 13£ cents per pound. A copy of the contract is attached to the complaint. The complaint further alleges that, on February 17, 1891, the plaintiffs, being ready to deliver the teas, requested of the defendants the names of the purchasers, and that the defendants thereupon notified the plaintiffs that they were the purchasers, and the complaint then proceeds as follows: “ That the plaintiffs, immediately upon learning that the defendants were interested as purchasers in the said contract for the sale of said teas, and that they had not procured a purchaser for the same, and that they had not been duly authorized by any person to enter into said contract for the purchase thereof from the plaintiffs, and to execute said bought and sold notes thereof, refused to be bound by said contract, and rescinded the same, and refused to deliver the said teas to the said defendants.”
    The complaint further alleges that, on the 2d day of February, 1891, the teas were worth 13j- cents per pound on the market, and that thereafter the market value of said teas declined, and the said teas depreciated greatly in value, “and that by reason oí all the premises the plaintiffs have sustained damages in the sum of $7,500.
    To this complaint the defendants interposed a demurrer, upon the ground that it did not state facts sufficient to constitute a cause of action.
    This demurrer the court overruled and ordered final judgment for the plaintiff for six cents damages, and awarded costs to the defendants; upon which decision judgment was entered for the defendants for the balance of the costs, after deducting the six cents damages.
    
      F. A. Thomson (Jas. J. Allen, of counsel), for app'lts; Jas. L. Bishop, for resp'ts.
   Freedman, J.

The complaidoes not state a cause of action for fraud or deceit, for fraud or deceit without damage is not actionable. The damages sought to be recovered are shown to have resulted, not from the fraud or deceit by means of which the plaintiffs were induced to enter into the executory contract of sale, but from their refusal to carry out the said contract and their rescission of it They were justified in such refusal and rescission. It appears, however, that if they had not so refused and rescinded no damage would have been sustained, for the fall in the market price had then already taken place, and the defendants were ready and willing, and presumably able to pay the contract price. The plaintiffs, by thus making an election which they had an undoubted right to make, brought about their own loss. The learned judge below was, therefore, correct in holding that, upon the facts set out in the complaint, the plaintiffs have but a technical cause of action, which is for the breach of the duty that the defendants, as brokers, owed to the plaintiffs, and that in this action, as it is set forth, the plaintiffs are entitled to nominal damages only.

The demurrer to the complaint having been overruled, and the damages on the facts stated in the complaint being, as matter of law, nominal, the court could proceed at once to award the damages, and the defendants’ right to costs in such a case being statutory under § 3229 of the Code, the judgment was properly entered under §§ 1021 and 1222 of the Code. If the plaintiffs can show a different state of facts and desire so to do, their remedy is by motion for leave to amend their complaint.

The judgment should be affirmed, with costs.

Sedgwick, Oh. J., concurs.