Case ID: ny-st-rep_18/html/0927-01.html
Source: Caselaw Access Project
Author: {"author": "Nehbras,J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Frederick P. Eppens et al., App’lts, v. Thomas McGrath, Resp’t.
    
      (City Court of New York, General Term,
    
    
      Filed October 26, 1888.)
    
    1. Contract—Credit given on sale—Mat be avoided by fraud and INSOLVENCY OF PURCHASER.
    A sale on credit may be changed into one for cash by the fraud and insolvency of the vendee.
    2. Same—Action upon—When fraud may be proved without having BEEN PLEADED.
    In an action brought by the vendor on such a contract of sale the fraud need not be alleged in the complaint. The fraud may be proved on the trial without having been pleaded.
    Appeal from a judgment dismissing plaintiff’s complaint.
    
      J. George Flammer, for appl’ts; James J. Byrne, for resp’t (Charles L. Cohn, of counsel).
   Nehbras,J.

The plaintiffs sued for goods sold and delivered. The defendant admitted the sale and delivery, but alleged a credit of sixty days, which had not expired. This was conceded by plaintiffs, and on the trial sought to prove the defendant’s insolvency at the time of the sale, and such acts on the part of the defendant as would amount to a fraud upon the plaintiffs and avoid the credit given, and resolving it into a sale for cash. Many facts and circumstances were proven, both by the cross-examinatian of the defendant and plaintiffs’ witnesses, which might fairly lead one to believe that at the time the defendant purchased the goods sued for he had no intention of paying therefor. It is idle to detail the various facts and circumstances.

At all events, the question of insolvency and fraud should have been submitted to the jury, and it was error to dismiss the complaint.

The plaintiffs had an undoubted right to bring their action in the form they adopted. They set forth their contract of sale and delivery to the defendant for cash. That a credit given may be avoided by the fraud and insolvency of the defendant is elementary, but the fraud need not be averred in the complaint, as an order of arrest has not been asked for. It is an ordinary suit on contract, changed into a sale for cash by the defendant’s fraudulent acts. So that the fraud may be proved on the trial without having pleaded it. Wigand v. Sichel, 3 Keyes, 120; White v. Harrison, 1 City Court Rep., 482.

There was abundant evidence to go the jury upon the question whether the defendant obtained the goods in suit by fraud, so as to avoid the credit given, and the dismissal of the complaint was error.

Judgment reversed and new trial ordered, with costs to abide the event.

McG-own, J., concurs.