Case ID: misc_29/html/0115-01.html
Source: Caselaw Access Project
Author: {"author": "Freedman, P. J. HacLeah, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

The Railway Advertising Co., Respondent, v. The Standard Rock-Candy Co., Appellant.
    (Supreme Court, Appellate Term,
    October, 1899.)
    Pleading — Recovery at law of less than was due by the terms of a written contract, disputed, is not a reformation in equity.
    The plaintiff sued in the Municipal Court of the city of New York for a month’s rent under a written contract to insert the defendant’s advertisements in the street cars of Providence for $112.20 per month, for eleven months. The defendant made a general denial, coupled with an admission of the execution of the contract, and it also pleaded fraud and rescission. Upon the trial the terms of the contract were litigated by both parties. According to the plaintiff’s version, the defendant intended to spend in Providence only the same sum as it had agreed to spend in St. Louis under a prior advertising contract between the parties, which had been canceled. This sum was $102 per month. The court charged the jury that, if they found from the whole testimony that the sum spent in St. Louis was $102 and that the intention of the parties was to spend only the same sum in Providence, then they might find for the plaintiff for $102. It also charged that it was for the jury to determine what the real contract was.
    Held, that, in view of the conflicting proof offered as to the terms of the contract, a recovery for $102 should be sustained.
    That the objection that the court had virtually allowed the contract to be reformed as in equity, and had then permitted a recovery under it as reformed, was untenable.
    (MacLean, J., dissented.)
    Appeal by the defendant from a judgment rendered in favor of the plaintiff, in the Municipal Court, first district, borough of Manhattan, upon the verdict of a jury.
    Hays, Greenbaum & Hershfield, for appellant.
    Greene & Johnson, for respondent.
   Freedman, P. J.

As appears by stipulation between the parties, the trial resulting in the judgment appealed from involved only the issues relating to the first cause of action set forth in the complaint.

So far as material to the questions presented by the present appeal, the issues litigated arose as follows:

The cause of action was based upon a written contract made between the parties, by the terms of which the defendant agreed to pay the sum of $112.20 per month, for a period of eleven months, from February 1, 1898, for the insertion of its advertising cards in 187 street cars, in the cities of Providence and Pawtucket, Ehode Island. The complaint alleged performance on the part of the plaintiff, and failure by the defendant to pay for one month’s rent. In the amended answer it is alleged that • in procuring the signature of the defendant to such contract the plaintiff made the false and fraudulent representation that 187 street cars were one-third of all the cars in said cities, while the fact was that such number was far in excess of all such cars, and that the defendant relied upon such representation. At the trial the defendant was permitted to further amend its answer by alleging a rescission of the contract.

Upon a former appeal brought by the plaintiff from a judgment in favor of the defendant, the judgment was reversed upon the ground that the evidence showed no rescission of the contract on the part of the defendant after the discovery by it of the alleged fraud. 24 Misc. Rep. 722.

In the present case, the defendant attempted to prove a prompt rescission of the contract after its discovery of the falsity of the alleged fraudulent representations, but did not show either a return or an offer to return the sum of two dollars and twenty cents claimed by the plaintiff to have been received by it from the plaintiff as part inducement for the execution of the contract at the time it was executed. Belying upon this point, the plaintiff’s counsel, on the submission of the case to the jury, requested the trial judge to charge, that if the two dollars and twenty cents were paid by the plaintiff to the defendant as part of the contract sued upon, and the jury should find that said sum was not returned, they must find for the plaintiff, because without the returning of it there was no rescission of the contract. Defendant’s counsel consented that such instruction should be given. The jury were instructed accordingly, and they found for the plaintiff. So far as their finding upon this point is decisive of the controversy between the parties, it should not be disturbed.

It appears, however, that, independently of the question of rescission, the question was sharply litigated throughout the trial whether any false or fraudulent representations had been made in the procurement of the contract. Upon this point there was a sharp conflict of testimony, and the conflict was submitted to the jury for determination. Here again the finding of the jury should not be disturbed unless there was error in the charge.

The justice charged, among other things, as follows: If you find that Hr. Weinberg (the president of the plaintiff) is telling the truth, and it was agreed that they (the defendant) would spend in Providence the same amount of money they would spend in St. Louis, it only proves after all that that was one hundred and two dollars. * * * If you believe from the testimony that that was the understanding * * * you will find a verdict for the plaintiff for the sum of $102, with $5.00 interest, which makes a total of $107.00.”

To this the defendant’s counsel excepted in the following lan-. guage: “ I take exception to your honor’s charge — to that part of it in which you say that if Hr. Weinberg’s testimony is true as to the sum of $102, being the amount that should have beern spent in St. Louis, should be spent in Providence, that the jury must find for the plaintiff.” The justice thereupon remarked: “ I said if they find from the whole testimony that it was so understood between the parties, they can find for the plaintiff.” Defendant’s counsel excepted to the modification.

It is contended that this instruction constituted error because it assumed the exercise of equity powers, and virtually allowed a reformation of the contract sued upon, and a recovery upon it after reformation. This contention cannot be sustained.

The liberality, almost informality, of practice sanctioned in the Municipal Court, and' the provisions of section 3063 of the Code of Civil Procedure, constitute an answer to the criticism. Horeover, the parties without objection litigated the contract on which the recovery was had and the testimony on this point took a wide range. The defendant’s testimony was to the effect' that the arrangements for the contract had been made by Mr. Palmer, the president of the defendant, and Hr. Weinberg, the president of the plaintiff; that Mr. Weinberg, on writing the contract, stated that the number of the cars therein mentioned would be one-third of all the cars; and that Mr. Palmer, relying upon Mr. Weinberg’s representations, then signed the contract for 187 cars. Mr. Weinberg, on behalf of the plaintiff, on the other hand, denied positively the making of any such representations, and then detailed the circumstances under which the contract was signed. These circumstances, and the inferences fairly deducible from them, established the following, viz.: The plaintiff and the defendant had an outstanding contract in St. Louis, and the plaintiff had specially acquired certain rights in St. Louis for the purpose of fulfilling that contract. The defendant was anxious to cancel the St. Louis contract, and the plaintiff agreed to cancel it provided it would be relieved from its obligations to the St. Louis company. This St. Louis contract was to run from January 1, 1898, for a period of twelve months. On January twenty-eighth plaintiff succeeded in getting released from its St. Louis obligations, and immediately notified the defendant, and the St. Louis contract, which still had eleven months to run, was cancelled. The defendant had promised that if a release could be obtained from the St. Louis contract, the defendant would expend the same amount of money in Providence that it had expended in St. Louis. On the day the Providence contract was signed Mr. Weinberg and Mr. Palmer talked over the matter, and Mr. Weinberg, under the impression that the St. Louis contract called for $112 per month, computed the number of cars which $112 would pay in Providence, at sixty cents per car. He found that $112 would pay for between 186 and 187 cars. He thereupon filled out the contract for 187. The cost of these cars would come to $112.20 per month. This sum was twenty cents per month in excess of the amount being paid in St. Louis; so Mr. Weinberg then and there paid Mr. Palmer in cash eleven times twenty cents, or two dollars and twenty cents, being the excess for the eleven months, so that the defendant would not be paying any more in Providence than St. Louis.

The contract was signed in duplicate, and Mr. Weinberg left. After he had gone down the street a few blocks, it occurred to him that an error had been made, because he then remembered that the St. Louis contract was for only $102 per month, instead of $112. He then telephoned to defendant’s office that the amount should be $102. Hr. Palmer was not there at the time, but defendant’s secretary answered that it was all right, and that the matter might be fixed up at some other time.

In view of these circumstances, and the fact already referred to, that both parties without objection litigated at great length the question as to what the contract really was, and the defendant’s counsel having failed to point out specifically any defect in the instruction given as modified, or to request any change, the instruction given to the jury as modified does not constitute reversible error. It was, under all the circumstances, but another way -of saying that if the jury believed plaintiff’s version of the transaction in preference to that given by the defendant, they could find for the plaintiff. The justice did not even say that in that -event they should find for the plaintiff. Horeover, the said in.struction constituted only part of the charge to the jury, and the -charge as a whole was to the effect that inasmuch as two inconsistent versions of the contract had been given, it was for the jury -exclusively to determine which side had given the true one, and to determine the issues accordingly.

Upon a careful examination of the whole record, I am satisfied that the judgment is righteous, and that none of the objections are meritorious. The undisputed payment of two dollars and twenty cents by the plaintiff to the defendant in order to reduce the monthly payments to $112 (the supposed amount mentioned in the St. Louis contract), is to my mind conclusive. The defendant admits the receipt of the two dollars and twenty cents, and it is entered on its books, but it offered no reason whatsoever why the plaintiff paid to it that sum. The claim of the plaintiff in that regard is most reasonable. I fail to discover any merit in the defense, and do not think the parties should be subjected to further litigation, when the result reached is clearly right, and the objections are technical and attenuated, and the defendant had the benefit arising from the performance of the contract on the part of the plaintiff. The judgment should be affirmed, with -costs.

Leventbitt, J., concurs.

HacLeah, J.

(dissenting). Abandoning its second and third causes of action, as appears by the return amended by stipulation of the parties, the plaintiff brought this action upon a written contract, dated January 28, 1898, whereby it agreed to place advertising cards of the defendant in 187 cars in Providence, Rhode Island, for a term of eleven months, commencing February 1,. 1898, and according to which the defendant agreed to pay §112.20 at the end of each month during the term of the contract, seeking to recover the amount alleged to be due for the month of February, 1898, in return for full performance of the contract on its part. The amended answer of the defendant set up a general denial, and a separate defense, to the effect that it signed the contract through false and fraudulent representations of the plaintiff, and in addition thereto, a counterclaim for damages in connection with another contract between the parties hereto, alleged to have been entered into on or about the 2d day of December, 1897.

After an apparently protracted trial, in which the evidence was-decidedly conflicting, the justice charged the jury, “ If you find that Mr. Weinberg (the president of the plaintiff) is telling the truth, and it was agreed that they (the defendant) would spend in Providence the same amount of money they would spend in. St. Louis, it only proves after all that that was one hundred and two-dollars. * * * If you believe, from the testimony, that that was the understanding * * * you will find a verdict for the-plaintiff, for the sum of one hundred and two dollars, with five dollars interest, which makes a total of one hundred and seven dollars.” To this the defendant excepted, but the jury so found. For this the judgment should be reversed and a new trial ordered. The defendant, by its answer, set up no other contract than the one declared on in the complaint, admitted its execution, and, as-it had the right to do, set up fraud as a defense thereto. Estelle v. Dinsbeer, 9 Misc. Rep. 485, 486. Furthermore, the defendant, at the trial, moved to be allowed to set up- affirmatively repudiation and rescission of the contract upon discovery of the fraud. No other contract than the one declared on in the complaint appears in the pleadings, so that -the charge to the jury, and their finding seems to be a virtual assumption of the exercise of equity powers, apparently recognizing the plaintiff’s right of recovery upon the contract sued upon, but reforming that contract because the same, either through mistake or fraud, was not quite what the parties made or intended to make. This was error because extra-jurisdictional. Ferree v. Ellsworth, 47 N. Y. St. Repr. 119. If this be not in effect reformation, then it must be conceded to be a recovery upon a cause of action not pleaded, and we may say as was said by Andrews, J., in Reed v. McConnell, 133 N. Y. 425, 433, “ This recovery was in violation of the rule that no judgment can be sustained in favor of a plaintiff on a cause of action not alleged in the complaint, unless the defendant, by his silence or conduct, acquiesced in the trial of the new and different cause of action, upon which the judgment proceeded.” This the defendant did not do.

Supposing, however, that it had been pleaded, then it is impossible to say that the defendant is at fault because it did not return the sum of two dollars and twenty cents received from the plaintiff, because it nowhere appears that such sum was in any manner connected with such agreement as the one upon which plaintiff recovered.

The judgment should be reversed and a new trial ordered.

Judgment affirmed, with costs.