Case Name: W. M'Corkle, v. J. W. Doby, and others
Court: South Carolina Court of Appeals
Jurisdiction: South Carolina
Decision Date: 1847-05
Citations: 1 Strob. 396
Docket Number: 
Parties: W. M’Corkle, v. J. W. Doby, and others.
Judges: Withers J. did not hear this case, having been of counsel.
Reporter: South Carolina Law Reports
Volume: 32
Pages: 396–402

Head Matter:
W. M’Corkle, v. J. W. Doby, and others.
A party cannot recover on an implied contract, if he has made a special contract which is void for fraud; he is not at liberty to say, I have made two contracts, and if one of them is void for fraud, I will set up the other. Vide, Selway v. Fogg, 5 Mees & W., 83; 9 Car. & P., 59; 1 Adoh & EL, 40.
It is at the option of the party, to be affected by a fraud, whether or not, he will treat the contract as void, or rescind it; but the right to rescind is subject to this restriction, that if, after the discovery of the fraud, he still avail himself of the benefit of the contract, or permit the other parly to proceed with the execution of it, he will thereby be held to have waived the tort, and affirmed the contract.
It is well settled, in the Courts of this State, that where there has been a sale, either upon a warianly as to the soundness of the article sold, or upon a fraudulent misrepresentation of its value, if a suit be brought upon the original contract of sale, the defendant may, upon notice, give the unsi.undness, or fraud in evidence; which will be an answer to the whole demand, or in mitigation of damages, according to the circumstances. And this principle applies with equal, if not greater force, to a building contract.
The declarations of a party, though sufficient to charge himself, are not evidence of a partnership against any other parly.
Tried before Mr. Justice Evans, at Lancaster, Spring Term, 1847.
The defendants were Commissioners of Roads for Lancaster District, and the action was against them to recover the sum of 525 dollars, for building a bridge. On the 3d of April, the Board appointed a Committee, consisting of three of their members, Johnson, Montgomery, and Crockett, to examine the bridge on Camp Creek, with an authority, if they thought it necessary, to contract for building a new bridge. The Committee deemed it necessary to build a new bridge, advertised to let it out to the lowest bidder, on some day, not recollected, in April. On the day appointed, several persons attended, of the Committee, Johnson and Montgomery were present. Johnson acted as cryer. There was a specification of the plan, and the mode oí execution. The whole to be finished by the 1st of August. The crying of the bridge commenced about 12 o’clock. Only one bid was made, at $700, by Cheves. At the request of Montgomery, the business was suspended until after dinner, when the building of the bridge was again offered. M’Corkle bid $525, and the contract was speedily knocked down to him at that sum by the cryer. M’Corkle immediately set about the work, and with the aid of Johnson, and Bell, made a good and substantial bridge according to the specifications, and completed it by the 1st of August, the time fixed in the contract. The Commissioners refused to pay for the bridge, on the ground of unfair combination between M’Corkle, Johnson, and Beil, to present competition, and thereby to enhance the price to more than double a fair and full compensation.
It was proved, very clearly from the admissions of M’Corkle, that there had been some conversation between M’Corkle and J ohnson, about taking the contract in copartnership, but M’Corkle said he had pretty well given up the idea. On the day of letting the contract, Johnson told M’Corkle, he and Bell had been making a calculation, and had concluded the bridge could be built for a certain sum: to which M’Corkle replied, that at that price he would have nothing to do with it, but if they would let it alone and let him bid it off, he would take them both in as partners. The presiding Judge did not consider this as any thing more than a promise by M’Corklc to admit them, if he got the contract, into a partnership of the profits of the contract, in consideration that they would not compete with him in the bidding. It may well be doubted if sucha contract would have been binding on M’Corkle. In the course of the trial, various attempts were made to prove by Johnson, declarations that he was a partner. All his acts and declarations in the presence of M’Corkle were fully received, but any thing beyond this was rejected, because it was hearsay. As to the agreement that Johnson should participate in the profits, the defendants had the full benefit of all the proof offered, for in the end it appeared that every thing offered to be proved, as Johnson’s declarations, was said in the presence of M’Corkle, and the verdict shows that the proof of the agreement was satisfactory to the jury. As to the supposed admissions of evidence, of consequential damages, some questions were asked about M’Corkle’s crop that year, with a view to show that at that season of the year no one could afford to take his hands out of his crop and build a bridge as cheaply as at another season, when his hands would be more at leisure. There was no proof any notice was given by the Board to M’Corlde of their dissent to the contract. Two members individually gave Johnson notice to that effect. The Board had no meeting until after the bridge was finished. At that meeting, Montgomery reported the letting out the building of the bridge, upon which the Board resolved that the price was extravagant, and directed the same Committee to go and examine the bridge, and to compromise if they could. The Committee did examine the bridge, and certified it was built according to contract. Most of the witnesses thought 180 or §200 a full price. The highest estimate was that of Montgomery, the Commissioner appointed to contract, who estimated it at §300.
There were two counts in the declaration, one on the special contract, the other on a quantum meruit. His Honor charged the jury, that if they believed (and there was certainly very little doubt of the fact) that M’Corkle entered into an agreement with Johnson and Bell, to buy off their competition, and thus enhance the price beyond what the work was worth, the contract was vitiated so far as regarded the price. But as the work was faithfully done, and the contract performed by M’Corkle, he could recover on the quantum meruit, and the jury found a verdict for §250.
The defendants appealed, and moved the Court of Appeals for a non-suit, and for a new trial, on the following grounds, viz: for anon-suit—
1st. Because the defendants had not accepted the bridge.
2d. Because the plaintiff, William M’Corkle, could not maintain an action in his own name, as the contract, if any were made, was a joint contract by himself and Abner D. Johnson, with the defendants and the plaintiff, and Abner D. Johnson having bid off and built the bridge, the suit must be in their joint name.
And for a new trial—
1st. The defendants will contend for a new trial, on the two grounds taken above for a non-suit.
2d. Because the contract under which the plaintiff claimed or set up his demand was null and void for fraud, and the defendants having notified the plaintiff before he commenced work on the bridge not to build it, as they would not pay him on account of the fraud practised on them, an action could not be supported on an implied promise.
3d. Because the Court rejected the declarations of Abner D. Johnson, as to the partnership between himself and plaintiff, after the defendants had already proved the plaintiff’s own repeated declarations to that effect.
4th. Because the Court admitted evidence on the part of plaintiff as to consequential damages by the loss of his crop, when there was no allegation of it in the declaration.
5th. Because the demand is founded in fraud, and the verdict is against law and evidence.
Thompson, for the motion.
The plaintiff cannot maintain this action at all. The contract is founded in fraud; and he cannot recover on the quantum meruit, because he hasinsisted on the specific agreement; Watts v. Todd, 1 M’Mul., 26; -n. Duncan, 2 M’Cord, 167; Chitty on Con., 566. There can be no action on a quantum meruit while the special contract is open; Chit, on Con., 607. The promise was to another, and there was no privity between these parties. Johnson was the agent to hire the bridge, and puffed, and took a part in the contract; Apthorpe v. Comstock, 2 page E. R., 482; Chit, on Con., 569, and notes. If he prove a different agreement from the one laid, he cannot recover on either, as where there was one special and the other implied. Any thing done to depress the bidding is fraudulent; Hamilton v. Hamilton.
Boyce, contra.
Johnson could not have brought the action. It would have been suing himself. The special contract is abandoned. The fraud attached only to the price, and the rea} worth can be assessed by the jury. The argument that he cannot recover on the quantum meruit, while the special contract exists, is to allow it and also disallow it for fraud. The consent ol the defendants to take the bridge, is surely enough to entitle the plaintiff to its real value; otherwise you would remedy one injustice (fraud) by perpetrating another. The verdict of the jury should stand. The board contracted only with M’Corkle, and not with Johnson, and he is not necessarily to be joined. M’Corkle is the sole contractor, and is to satisfy Johnson himself. Johnson and others were employed by the contractor.

Opinion:
Fkost J.
delivered the opinion of the Court.
The only question made by the grounds of appeal, which it is material to decide, respects the plaintiff's right to recover on the special contract. He cannot recover on the implied contract, if he has made a special contract which is void for fraud. A person is not at liberty to say, I have made two contracts; and if one of them is avoided for fraud, I will set up the other. Selway v. Fogg, 5 Mees & W., 83; 9 Car. & P., 59; 1 Adol & El., 40.
It is generally affirmed as a rule, that fraud avoids all contracts. But it would be more correct to say, fraud makes all contracts voidable: for it is at the option of the party to be affected by the fraud, whether or not, he will treat the contract as void, and rescind it. The right to rescind, however, is subject to this restriction: that if, after discovery of the fraud, one party still avails himself of the benefit of the contract, or permits the other to proceed with the execution of it, he will thereby be held to have waived the tort and affirmed the contract. The case of Campbell v. Fleming, 1 Ad. & El., 40, was an action for money had and received. The plaintiff had purchased some mining shares on the representations of the defendant, which he afterwards discovered were false and fraudulent. After the discovery, the defendant dealt with the shares as his own, and sold a part of them. The plaintiff was non-suited. It was held, that there was no doubt a gross fraud on the plaintiff; but that after he had learned an imposition had been practised on him, he ought to have made his stand, and knowing the fraud, and having elected to treat the transaction as a contract, he had lost his right of rescinding it.
It is well settled in the Courts of this State, that where there has been a sale, either upon a warranty as to the goodness of the article sold, or upon a fraudulent misrepresentation of its value, if a suit be brought on the original contract of sale, the defendant may, upon notice, give the unsoundness or fraud in evidence as a defence; which will be an answer to the whole demand, or in mitigation of damages,,according to the circum stances. The cases which have been cited relate to the sale of goods; but the principle of them applies with equal, if not greater force, to a building contract.
In this case there was no fraudulent misrepresentation which induced the defendants to contract for that which was unsuitable to their purpose; or which, without such representations, they would not have contracted for. The bridge for which the defendants offered the contract was faithfully built, according to the specifications; and the fraud alleged by the defendants, is, that the plaintiff combined with others to buy off competition, and thus obtained the contract at an extravagant price. In such a case, the Circuit Judge held, that the plaintiff was entitled to recover as much as the bridge was worth. That was the proper measure of damages; and the verdict for the plaintiff, on the special contract, is supported by the evidence. The terms of the plaintiff's contract were publicly announced at the bidding; two of the committee of the board (who are the defendants) were present, and approved it; one of them is not implicated in the unfair suppression of competition. Through their agent, the defendants are chargeable with notice. The plaintiff was permitted to go on and build the bridge, without any objection from the board; and no notice was given to the plaintiff, even by the members who knew and complained of the terms. The bridge is appropriated to the use of the people of the district, whom the defendant? officially represent, and cannot be delivered to the plaintiff, nor taken possession of by him without committing an indictable offence. After the defendants were informed of the imposition practiced on them, they sent a committee to inspect the bridge, and received their report that it was laithfu ly built, according to the specifications. They did bv resolution disapprove of the cost; but did not even then renounce the contract, but offered to compromise with the plaintiff the disagreement about the cost: on this proof the jury were warranted to find that the defendants had lost or waived their right to rescind the contract.
Theotbergroundsofappe.nl, except the 3d, relate to the facts of the case, which are explained by the report, or are inconsistent with it. The 3d is only material to the common count, and is not tenable, for the declarations of Johnson, though sufficient to charge himself, are not evidence of a partnership against any other party.
The motion is refused.
Withers J. did not hear this case, having been of counsel.