Case ID: ny_59/html/0265-01.html
Source: Caselaw Access Project
Author: {"author": "Allen, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Demas Barnes, Respondent, v. Daniel J. Quigley, Appellant.
    (Argued December 3, 1874;
    decided December 15, 1874.)
    Where the gravamen of an action is fraud, the court cannot change its form and allow a recovery as in contract, although facts may be stated in the complaint by way of inducement, which might sustain such an action.
    Plaintiffs complaint alleged, in substance, that he was the owner of a promissory note made by defendant; that, relying upon certain false and fraudulent representations made to him by defendant (particularly set forth), he was induced to and did accept from defendant a sum $583.70 less than the amount due upon the note, and surrendered up the same to defendant, and was thereby defrauded out of said sum, and sustained damages to that amount. Defendant’s answer admited the allegations of the complaint as to the making of the note, the payment and surrender thereof, but denied all the other allegations. Upon trial the court directed a judgment for the plaintiff, on the pleadings, for the amount unpaid on the note. Reid, error; that the action was for fraud, not contract, and the court had no right to disregard the principal allegations of the complaint which characterized the action, and were put in issue by the answer, and try the action as one upon the note.
    Appeal from judgment of the General Term of the Supreme Court in the second judicial department, affirming a judgment in favor of plaintiff, entered upon a verdict, and affirming an order denying a motion for a new trial.
    The complaint in this action, in substance, alleged, that on the 3d day of April, 1871, plaintiff was the owner of a promissory note made by defendant, payable to the order of Britton & Go.-, for $2,165.86; which was indorsed by the payees and transferred to plaintiff before maturity; that prior to its maturity the payees failed and made an assignment; that on or about the day mentioned, defendant, for the purpose of deceiving plaintiff and inducing him to surrender up the note for a less sum than was due thereon, falsely and fraudulently represented that the note was made by him solely for the accommodation of the payees, he receiving no consideration whatever therefor, and that all moneys paid by him upon the note would be an entire loss, whereas the note was in fact for merchandise sold by the payees to defendant, and that he received full value for the note. That plaintiff relying upon said representations, and being ignorant of the facts, was induced thereby and did accept $582.70 less than the amount due, and surrendered up the note.
    That by reason of the premises said plaintiff has been deceived and defrauded by said defendant out of said sum of $582.70, and has sustained damage to that amount.
    Defendant’s answer admitted the allegations of the complaint as to the making, indorsement and transfer of the note, the failure of the payees, and that he paid the sum of $1,600 in full settlement of the note, which was surrendered up to him. He denied all the other allegations of the complaint. On the trial plaintiff moved for judgment on the pleadings, which motion was granted, and directed a verdict for the balance unpaid on the ndte, to which defendant’s counsel duly accepted.
    
      N. C. Moak for the appellant.
    The surrender of the note to defendant, in the absence of fraud, was a release, even though plaintiff at the time accepted an amount less than the face of the note. (Beach v. Endress, 51 Barb., 570 ; Bouv. L. D., tit. ‘‘Release;” Licey v. Licey, 7 Barr, 251; Albert v. Zeigler, 29 Penn., 50; Pot. Ob. N. N., 608, 609 ; 2 Eq. Cas. Abr., 617; Wentz v. De Hazen, 1 S. & R., 317; Picot v. Sanderson, 1 Dev., 309; Shepherd’s Touch., 70; 8 Bacon’s Abr., 245.) Plaintiff claiming to recover for fraud and deceit could not, on the trial, change the nature of his action and recover on contract. (Beach v. Andress, 570, and cases cited; Rose v. Mather, 51 N. Y., 108; Degraw v. Elmore, 50 id., 1; Elwood v. Gardner, 45 id., 349; Sager v. Blain,, 44 id., 445 ; Church, etc., v. Crawford, 14 Abb. [N. S.], 200.) The answer did not admit a cause of action against defendant. (Code, § 148.)
    
      D. P. Barnard for the respondent.
    The payment of $1,600 for the principal and interest was no bar to the recovery of the balance. (Bunge v. Koop, 48 N. Y., 225; Fitch v. Sutton, 5 East, 232; Harrison v. Close, 2 J. R., 448; Dederick v. Leman, 9 id., 333; Seymour v. Minturn, 17 id., 170 ; Hammond v. Christie, 5 Robt., 160; Markel v. Spilter, 28 Ind., 448; Harriman v. Harriman, 12 Gray, 341; Carter v. Martin, 20 Ill., 557; Bailey v. Day, 26 Me., 370; White v. Jordan, 27 id., 88; Warren v. Skinner, 20 Conn., 559; Bowker v. Childs, 3 Alb., 434.) The allegations in the complaint showing what induced plaintiff to accept the lesser sum were properly treated as surplusage and were immaterial to the right of recovery. (Bixbie v. Wood, 24 N. Y., 607; Read v. Lambert, 10 Abb. [N. S.], 437; Barker v. Clark, 12 id., 106.) To constitute an action for deceit there must be deception, a reliance thereon and resulting damages. (White v. Merrill, 3 Seld., 352; Corwin v. Davison, 9 Cow., 22; Williams v. Wood, 14 Wend., 126; Hubbard v. Briggs, 31 N. Y., 518-529.)
   Allen, J.

The complaint is for fraud, and not upon contract. Whether the facts stated constitute a cause of action is not material. The whole frame-work is in fraud, and the cause of action, as set forth, is based upon the false and fraudulent representations of the defendant, by which the plaintiff was induced to surrender and give up to the defendant his promissory note, held and owned by the plaintiff) for an insufficient consideration, an amount considerably less than its face, by reason whereof, as alleged, the u plaintiff has been deceived and defrauded out of said sum of $582.70, and has sustained damage to that amount.”

The theory of the plaintiff at the commencement of the action, and the foundation of his claim as formally made in his complaint, was, that a surrender of the note upon fhe receipt of an agreed sum, less than the amount actually due in satisfaction for the full sum, was equivalent to a release under seal, and effectually discharged the debt. In that view he could only recover by impeaching the release and discharge, for fraud, and he framed his complaint to meet the case in that form. His whole cause of action rested upon the alleged fraud, and it was an entire change of that cause, and a surprise upon the defendant, when this view was ignored by. the counsel and the court at the trial, and a verdict ordered upon a denial in the answer of the only material allegations of the complaint. We are not to speculate upon the question whether the surrender of the note did discharge the obligation. The plaintiff assumed that it did, and brought his action to recover for the fraud by which the discharge was procured. It w*as error in the court to change the form of the action, by striking out or treating as surplusage the principal allegations—-those which characterize and give form to the action —■ because, perchance, there may be facts stated by way of inducement spelled out, which would, when put in prtipCr form, have sustained an action of assumpsit.

The defendant was called upon to answer the allegations of fraud, and not to resist a claim to recover in assumpsit. . The two forms of actions might require very different defences. This is not the case of an obligation or contract fraudulently incurred, 'in-an action upon which the fraudulent acts of the obligor or promissor are averred, which, as they do not enter into the contract, and are not essential to the cause of action, may and should be rejected as surplusage, as in Graves v. Waite, recently decided by this court. The plaintiff was not, under the complaint, entitled to a verdict and judgment, as in an action upon the note. The defendant, in preparing his answer and putting in his defence, was as unconscious of any necessity of stating and setting up any defence he might have to the note, as the framer of the complaint was innocent of any intent to make a case for a recovery upon the note, as a valid ^nd subsisting obligation. While the Code is liberal in* disregarding technical defects and omissions in pleadings, and in allowing amendments, it does not permit a cause of action to be changed, either because the plaintiff fails to prove the facts necessary to sustain it, or because he has mistaken his remedy, and the force and effect of the allegations of his complaint. (Code, § 173; DeGraw v. Elmore, 50 N. Y., 1; .Ross v. Mather, 51 id., 108; Elwood v. Gardner, 45 id., 349.)

The judgment must be reversed and a new trial granted, costs to abide the event.

All concur in result.

Judgment reversed. 
      
       Ante, p. 156.