Case Title: Bryan Constr. Co., Inc. v. Thad Ryan Cadillac, Inc.

Citation: 300 So. 2d 444

Docket Number: 

State: mississippi

Court: Mississippi Supreme Court

Date: 1974-09-16T00:00:00Z

Document:
300 So. 2d 444 (1974) BRYAN CONSTRUCTION COMPANY, INC. v. THAD RYAN CADILLAC, INC. No. 47688. Supreme Court of Mississippi. September 16, 1974. *445 Young, Young & Scanlon, Robert B. Sessums, Jackson, for appellant. Cox & Dunn, Ltd., Jackson, for appellee. RODGERS, Presiding Justice. This is an appeal from an order of the Circuit Court of the First Judicial District of Hinds County, Mississippi, sustaining a special plea in bar on the election of remedies and dismissing with prejudice the appellant's cause of action. The dismissed suit was for actual and punitive damages due to an alleged fraud practiced on the appellant by the appellee in the sale of a used car. Its election of remedies resulted when the appellant chose to rescind the sales contract and cancel the debt. Appellant appeals, and assigns the following sole error: "The lower court erred in sustaining appellee's special plea to the declaration of the appellant." On December 7, 1972, the appellant, Bryan Construction Company, Inc. [hereinafter referred to as Bryan], purchased from appellee, Thad Ryan Cadillac, Inc. [hereinafter referred to as Ryan Cadillac], a 1970 Cadillac for the total price of three thousand six hundred ninety-five dollars and five cents ($3,695.05). The purchase agreement was evidenced by a written promise to pay the agreed price at a future date. It is alleged that the speedometer on the car registered thirty-two thousand (32,000) miles at the time of the sale, and that Ryan Cadillac's salesman represented *446 to Mr. Charles Bryan, who purchased the automobile for and on behalf of the appellant, that the speedometer was accurate and showed the actual miles the car had been driven. Appellant Bryan alleges that it began to have mechanical problems with the car, and in attempting to determine whether or not the prior owner of the car had experienced similar mechanical problems, Bryan learned that at the time Ryan Cadillac took the car as a trade-in, the speedometer showed a mileage reading in excess of fifty thousand (50,000) miles. Bryan further alleges that it first endeavored to have Ryan Cadillac take the automobile back in return for the purchase price, and then it notified Ryan Cadillac, in writing, to pick up the car. Having received no acknowledgement of his letter from Ryan Cadillac, Bryan finally had the car towed to Ryan Cadillac's used car lot and left there. Ryan Cadillac admits the sale of the car, but denies all other allegations. On January 31, 1973, Bryan filed simultaneous actions in the Circuit Court of the First Judicial District of Hinds County, Mississippi. Cause No. 21,410 was a suit for the rescission of the contract and return of the purchase price, and Cause No. 21,411 was a collateral suit for actual and punitive damages due to the fraud allegedly practiced on Bryan by Ryan Cadillac. On February 6, 1973, Cause No. 21,411 was amended so that the prayer for relief is as follows: On March 2, 1972, Ryan Cadillac filed its answer in Cause No. 21,410, accepting the rescission of the contract and cancelling the debt due it by Bryan for the purchase of the automobile. Bryan had not made any cash payments towards the purchase price of the car since its agents had given a note; moreover, no payment was due under the sales agreement. Ryan Cadillac further tendered the amount of fifteen dollars and seventy-five cents ($15.75) into the Court as payment of the towing fee incurred by Bryan in returning the car to the used car lot. On March 5, 1973, Ryan Cadillac filed its answer in Cause No. 21,411, incorporating therein a special plea in bar of election of remedies alleging that by filing the suit for rescission, and having the rescission accepted by Ryan Cadillac, Bryan had elected its remedy and was barred from recovery of any damages for the tort of fraud in Cause No. 21,411. Ryan Cadillac's special plea was heard separately and on April 23, 1973, the circuit judge entered an order sustaining that plea and dismissing Cause No. 21,411 with prejudice to the appellant. It is well established that prior to the enactment of the Uniform Commercial Code [UCC] an aggrieved buyer was required to elect between his remedies under the common law. He could either rescind and recover his purchase price accompanied with a return of the goods, or he could affirm the contract and seek damages. This rule is thoroughly ingrained in the case law of *447 this state. In Laurel Auto Supply Co. v. Sumrall, 184 Miss. 88, 185 So. 566 (1939), this Court set out the rule as follows: See also Lloyd Ford Co. v. Sharp, 192 So. 2d 398 (Miss. 1966); 3 Williston on Sales, § 25-3 (4th ed. 1974). The adoption of the Uniform Commercial Code somewhat modified this doctrine. Mississippi Code 1942 Annotated § 41A:2-721 (Supp. 1967) [now Mississippi Code Annotated § 75-2-721 (1972)] [also § 2-721 of the Uniform Commercial Code], provides: It is obvious that this section does permit some damages, in addition to the return of the purchase price, to be recovered along with the rescission when accompanied by fraud. The question is what damages are allowed. In 67 Am.Jur.2d Sales § 517, at 697-98 (1973), it is stated: The Third Circuit Court of Appeals has apparently recognized a partial change in the doctrine of election of remedies in Associated Hardware Supply Co. v. Big Wheel Distributing Co., 355 F.2d 114 (3d Cir.1956), where it held: "The Code, although also making damages available in an action for rescission, UCC 2-721, does not *448 otherwise change the traditional theory of election of remedies." 355 F.2d at 120. It must be remembered that the Uniform Commercial Code with reference to sales has to do with contracts of sales and not torts. The remedy of the buyers to rescind the contract and to be put in status quo by recovery of the purchase price under the common law has not been changed by the Uniform Commercial Code, except to permit the recovery of additional damages, described as "incidental" and "consequential" damages. Mississippi Code Annotated Section 75-2-715 (1972) is in the following language: The common law rule that the purchaser may retain the purchased goods and sue for damages has been changed by the Uniform Commercial Code as follows: Neither of the foregoing remedies under contract of sales permits the recovery of punitive damages.[1] The Code expressly states that penal damages may not be recovered under the Uniform Commercial Code. Mississippi Code Annotated Section 75-1-106 (1972) is in the following language: Under the common law an aggrieved party who was defrauded had the option to elect to use one of the remedies in contract law of sales set out in Laurel Auto Supply Co. v. Sumrall, supra, or he *449 had the option to bring his action in tort for fraud and deceit. Mayfield Motor Co. v. Parker, 222 Miss. 152, 75 So. 2d 435 (1954); Hunt v. Sherrill, 195 Miss. 688, 15 So. 2d 426 (1943). In Parker, the appellant complained that the bill of sale was not attached to the declaration, but the Court pointed out that the action was not founded on a writing and said: "This was a tort action, founded on fraud and deceit. The plaintiff had the right to choose this form of action." 222 Miss. at 159-160, 75 So. 2d at 437. As a general rule when a tort action is based on fraud and the fraud is grossly unjustifiable, punitive damages may be awarded. Sovereign Camp, W.O.O. v. Boykin, 182 Miss. 605, 181 So. 741 (1938). In the instant case now before the court, the appellant elected to sue in contract, to rescind the contract and to recover the purchase price plus the cost of returning the purchased property to the seller. The seller accepted the rescission of the sales contract, cancelled the indebtedness, and tendered into the court the cost of returning the automobile to the purchaser. We are of the opinion that since the appellant purchaser elected to sue in contract rather than in tort for deceit and fraud, he has elected his remedy and cannot now be heard to also sue in tort for general and punitive damages.[2] We pointed out in Home Insurance Co. v. Tate Mercantile Co., 117 Miss. 760, 78 So. 709 (1918), the following rule: The judgment of the trial court sustaining the special plea in bar is therefore affirmed. Affirmed. SMITH, ROBERTSON, WALKER and BROOM, JJ., concur. [1] There is one case brought to our attention which seems to hold to the contrary. See Grandi v. LeSage, 74 N.M. 799, 399 P.2d 285 (1965). [2] This case was tried prior to the enactment of Miss.Gen.Laws, Ch. 315 [1 Adv.Sheet 14 (March 5, 1974)].