Case Name: John W. North, Respondent, v. John B. Stevenson, Appellant
Court: St. Louis Court of Appeals
Jurisdiction: Missouri
Decision Date: 1897-05-22
Citations: 71 Mo. App. 427
Docket Number: 
Parties: John W. North, Respondent, v. John B. Stevenson, Appellant.
Judges: Judge Bland concurs; Judge Biggs dissents.
Reporter: Missouri Appeal Reports
Volume: 71
Pages: 427–438

Head Matter:
John W. North, Respondent, v. John B. Stevenson, Appellant.
St. Louis Court of Appeals,
May 22, 1897.
1. Receipt, Suit for Cancellation and Recovery of Amount of: fraud: evidence. In a suit for the recovery of a certain sum of ■money expended by plaintiff on defendant's behalf, and for the cancellation of a receipt in full therefor, executed by plaintiff, on the alleged ground of fraud in its procurement, where the facts upon whieh plaintiff based his right to set aside the receipt had no tendency to show that he had no contracting mind at the time he gave it, nor to prove that he signed it supposing he was signing a different paper, — Held: That the contract, evidenced by such receipt, was not void, but merely voidable, and, to set it aside, it was necessary it should appear that the amount received thereunder had been returned . or tendered defendant. (Ooh v. B’y, 130 Mo. 27.)
2. Remanding Cause for Amendment in Conformity With Rule. But held: That, as appellant may have refused to accept a return of the consideration of such receipt, or may .have consented to its application to some other indebtedness existing between himself and respondent, the cause should be remanded to permit respondent to file an amended petition tendering a return in conformity with the rule stated supra.
Appeal from the McDonald Circuit Court. — Hon. J. C. Lamson, Judge.
Reversed and remanded;
Judge Bland concurring, Judge Biggs dissenting.
Fdw. J. White for appellant.
The cause of action stated in the first count of respondent’s petition, being in equity, this court will review the entire evidence thereunder, make its own findings of fact, and practically try the case under this count de novo. Blount v. Spratt, 118 Mo. 48; Finley v. Schlueter, 54 Mo. App. 455.
The case of fraud should be clearly and strongly proven, by respondent, before the court should interfere to grant the relief sought. Bisp. Prac. Eq. [4 Ed.], sec. 189, p. 243, and citations; Vashagev. Vashage, 45 Mo. App. 172.
It is elementary that the pretended representation of appellant that the note in question “was not paid and would not be paid,” to afford a basis for the cancellation of the compromise agreement, must have been relied on by respondent. Bisp. Prac. Eq. [4 Ed.], sec. 215, p. 272. See, also, Kerr on Fraud and Mis. 75; Winter’s App., 11 P. F. Sm. 387; Hough v. Richardson, 3 Story, 659; Parker v. Hays; 39 N. J. Eq. 469; Veasey v. Baton, 3 Allen, 380; Brown v. Leach, 107 Mass. 364; Clark v. Everhart, 13 P.’ F. Sm. 347; Wright v. Gully, 28 Ind. 475.
The court erred in overruling appellant’s demurrer to the first count of the petition. 1 Beach, Mod. Law Con., sec. 794, p. 973; Bisp. Prac. Eq. [4 Ed.], sec. 43, p. 62, and citations. See, also, Billings v. Aspen, etc., 52 Fed. Rep. 250; Robinson v. Siple, Í29 Mo. 208; Och v. R’y Co., 130 Id. 27; Carson v. Smith, 133 Id. at 614; Bwyer v. R’y, 66 Mo. App. 335; ReUer v. Packing Co., 58 Id. 264.
Geyer & Murray, J. W. Brunk, and Hugh Babbs for respondent.
The statements and representations concerning appellant’s financial condition were representations of facts peculiarly within the knowledge of appellant, and respondent, not knowing them to be false at the time, had a right to rely on them, and having acted on such representations, the same being false, his right to relief is clear. Pom. Eq. Juris., secs. 891, 892; Cottrillv. Krurn, 100 Mo. 397, 404, 405; Kerr on Fraud, pp. 80-82.
“It is no excuse, nor does it lie in the mouth of appellant to aver, that respondent might have discovered the wrong, and prevented its accomplishment by watchfulness or inquiry, for this would be equivalent to saying: ‘You trusted me,-therefore I had a right to betray you.’” Pomeroy v. Benton, 57 Mo. 531; Cottrill v. Krum, supra; Wannell v. Kem, 57 Mo. 478; GottschaTk v. Kircher, 109 Id. 170; 7 Am. and Eng. Ency. Law, 732, 756, and notes.
If a party intentionally misrepresents a material fact, or produces a false impression by words or acts, in order to mislead or to obtain an undue advantage, it is a case of manifest fraud. Story, Eq. Juris., sec. 192; Big. on Fraud, pp. 527, 528; Pom. Eq. Juris., secs. 891, 892; Kent’s Comm. 482; McAdams v. Gates, 24 Mo. 223; Wannell v. Kem, supra; Gottschalk v. Kir diner, supra.
■ The burden is on appellant of removing the presumption that respondent relied and acted on his statements. Pom. Eq. Juris., sec. 891, and citations. See, also, Baivlins v. Baiolins, 109 Mo. 563; Barlow v. Elliott, 56 Mo. App. 374.
The attitude of appellant from the time the receipt was obtained from respondent, and his subsequent conduct, show conclusively that a tender by respondent would have been useless in this ease, and in such case tender is not required. Girard v. Gar Wheel Go., 123 Mo. 371; Westlake v. St. Louis, 77 Id. 47; Big. on Fraud (1888), p. 424; Deidiman v. Deidiman, 49 Mo. 107. See, also, Girard v. Gar Wheel Go., 46 Mo. App. 79; 109 111. 120.
If this court should decide tender necessary in this case under the ruling in Och v. B?y, 130 Mo. 37, and Dwyer v. B’y, 66 Mo. App. 335, it should reverse and remand for new trial, as these cases expressly hold that the plaintiff could amend on. proper terms. Och v. M’y, supra, pp. 48, 49; Dwyer v. M’y, supra, 341.
appellant’s eeply.
The record clearly shows that the judgment was recovered on a theory on which no action at all was maintainable, and where this is true the appellate court will reverse the judgment, without remanding the cause. Finkelnburg’s Mo. App. Prac.,pp. 95, 96; Quay v. Lucas, 25 Mo. App. 4; Jenláns v. McCoy, 50 Mo. 348; McGee v. Larimore, Id. 425.

Opinion:
Bond, J.
The first count of the petition alleges that in 1893 the defendant and others sold the Kansas City, Fort Smith & Southern Railway to the Missouri Coal and Construction Company; that as a part of said bargain defendant agreed with the purchaser to perfect the title to the right of way of said railway in Jasper, Newton and McDonald counties, Missouri, and in Benton county, Arkansas; that in May, 1893, defendant employed plaintiff, who is an attorney, to perform these services, agreeing to pay him well for such work; that in the discharge of his duties in this employment plaintiff devoted the whole of 1893 and that part of 1894 ending February 28, giving almost his entire time to said matters, and paid out on defendant's behalf large sums of money, amounting to $1,255; that by deceit and fraud defendant procured from plaintiff a receipt in full for all of said sum, except $304.85 (expended by plaintiff) in consideration of a payment to plaintiff of only $250. A cancellation of this receipt is asked.
The second count of the petition asked judgment for the $1,255.
The third count prays judgment for the $304.85.
The answer denies that, defendant individually employed plaintiff, and avers that whatever employ ment was had was made by defendant in his capacity as president of the railway. It avers further that plaintiff has no cause of action against defendant individually. It then denies the services rendered by plaintiff were worth the amount claimed, and sets up the above mentioned receipt given by plaintiff, as a complete bar to his recovery. The reply states that defendant never disclosed the agency claimed in his answer when plaintiff was employed, but assumed to act in that matter in his own behalf. Plaintiff elected to try first the equitable count in his petition. The court found the issues on that count in favor of plaintiff and decreed a cancellation of the receipt. Thereafter the second and third counts were submitted to a jury, and a verdict rendered in plaintiff's favor on both. Defendant appealed.
It is conceded in the reply brief filed by appellant, that the judgment on the third count should be affirmed. The only question, therefore, which remains is as to the correctness of the finding on the first and second counts. The matters. for which a recovery is sought in the second count were embraced in the receipt sought to be cancelled in the first count. If, therefore, the court erred, under this record, in decreeing a cancellation of that' receipt, the judgment on these counts can not stand. The facts upon which plaintiff bases.his right to set aside the receipt executed by him do not tend to show that he had no contracting mind at the time he gave the receipt, nor do they tend to prove that he signed it when he supposed he was signing a different paper or instrument. Therefore under the rule laid down by a majority of the supreme court the contract evidenced by such receipt was merely voidable, not void, and to set it aside it was essential that a suit in equity should be brought for that purpose, in which it should appear that the amount received under the receipt had' been returned or tendered the defendant. Och v. Railway, ISO Mo. 27. As there was no evidence in this case of such a return or tender of the consideration, the decree of the court cancelling the receipt can not be sustained under the authority of the ease last cited. This necessitates a reversal of the judgment on the first and second counts. Respondent insists that the cause should be remanded, in order to permit an amendment of his cause of action on the first count in conformity with this rule. Appellant objects to this on the ground that the respondent's testimony disclosed he did not tender the return of the consideration of sai¿l receipt. It does not follow that appellant may not have refused to accept a return, or that appellant may not have consented to the application of said sum to some other indebtedness existing between himself and respondent. Moreover respondent may file an amended petition tendering a return of the consideration. Cleary v. Mun. Electric Light Co., 19 N. Y. Supp. 951. The judgment of the lower court on the third count is affirmed. Its judgment on the first and second counts is reversed and the cause remanded.
Judge Bland concurs; Judge Biggs dissents.