Court Opinion

ID: 3885433
Source: CourtListenerOpinion
Date Created: 2016-07-06 09:15:27.149231+00
Date Added: 2024-06-11T13:51:53.484463
License: Public Domain

Plaintiff petitions for a rehearing on the ground that the Court misconceived the issues made by the *Page 516 
pleadings, and decide the case on a different theory from that on which it was brought and tried in the Court below, in that plaintiff sued for actual and punitive damages, on the ground that he intrusted to defendant $500 for the purpose of forming a corporation, and not to pay for stock in a corporation already formed, and that, instead of forming the corporation, defendant fraudulently appropriated the money to his own use; and for actual damages, on the ground that, induced by defendant's promise to form the corporation, he broke up his home and moved to Columbia, the damage so claimed being the expenses of moving, his loss of time, etc.
It is true that we decided the case on a different theory from that stated, not because we misconceived the issues, but because we found that it had been tried upon an erroneous theory of the law applicable to the facts proved. Cases must be decided according to the facts proved, or facts of which there is some evidence, and not upon mere allegations of fact which are denied and unsupported by evidence. If the facts alleged had been proved or if the evidence had been sufficient to warrant a reasonable inference of their truth, our decision might have been in accordance with the theory upon which the case was brought and tried.
Plaintiff sued for damages for breach of the contract, the substance of which was stated in the opinion, and alleged, also, that defendant induced him, by false and fraudulent representations, to make the contract, and that he was guilty of a fraudulent breach thereof, in failing to organize the corporation and deliver the stock paid for, and in appropriating to his own use the money paid him for the stock.
The case was tried upon the theory that there was sufficient evidence to prove the allegations of fraud, and, against defendant's objection, which was reserved by exceptions to this Court, plaintiff was allowed to prove, as actual damages, his expenses in moving to Columbia, his loss of time, etc.; and, on the same theory, *Page 517 
the Court instructed the jury that, if they found the facts alleged to be true, such damages were recoverable, to which instructions exceptions were duly taken.
Now, when we found that the evidence was insufficient to warrant the inference of fraud, either in inducing plaintiff to make the contract, or in defendant's breach thereof, it necessarily followed, as a logical and legal sequence, that the trial Court had erred in admitting the testimony objected to, and in the charge complained of. We thought that was so clear that it was unnecessary to state it. Perhaps, however, we should have stated explicitly the process of reasoning by which we reached the conclusion that it was unnecessary to consider the exceptions to the admission of evidence and the charge, instead of merely saying that, in view of the insufficiency of the evidence to sustain the allegation of fraud, we deemed it unnecessary to consider those exceptions.
The contention that the money paid to defendant for the work was paid in trust is clearly untenable. The transaction was simply a sale and purchase of an interest in defendant's business, which the parties agreed should be capitalized at $5,000 and incorporated, and, when incorporated, the stock paid for by plaintiff was to be delivered to him. The money, therefore, belonged to defendant as so much paid to him for an interest in the business, which was to be represented by the stock to be delivered to him, as soon as the incorporation of the business was perfected. The failure to incorporate was nothing more than a breach of the contract to do so.
While defendant denied that the failure to incorporate was altogether his fault, and insisted that the delay in doing so had been acquiesced in by plaintiff to such an extent as to amount to waiver, that issue was decided against him by the jury. Therefore we said that defendant had breached his contract to incorporate, and was liable for the consequent *Page 518 
damages. There was no evidence that plaintiff had suffered any damages from the failure to incorporate, other than the loss of interest on the money paid to defendant, because the evidence is undisputed that the business was a failure, and did not make enough to pay running expenses, to say nothing of dividends on the stock, if it had been incorporated, and there was no evidence tending to prove that the failure to organize the corporation caused or had anything to do with the failure of the business.
Having reached the conclusion that the evidence was not sufficient to sustain the charge of fraud, and, therefore, that the Court erred in admitting the evidence objected to, and in its charge as to the plaintiff's right to recover such damages, a new trial absolute would have been inevitable but for the fact that, during the argument, a member of the Court asked defendant's counsel if defendant would be willing to pay back to plaintiff the money which he had received, with interest, and, his counsel being unable to answer, defendant himself arose and said that he was perfectly willing to so do. In view of that circumstance, and taking the view, most favorable to plaintiff, that he would probably prefer to hold the judgment which he had obtained for the money paid with interest rather than be put to the trouble and expense of a new trial, we framed our judgment so as to give him the option, and not with the intention of reducing the amount of actual damages found for him at all. He still has the option to take a new trial, if he be advised that he can prove that he sustained more damages by the failure to organize the corporation and deliver to him the stock which he paid for than the amount which he paid to defendant with interest thereon.
It will be seen, therefore, that counsel for plaintiff is mistaken in supposing that we undertook to consider the sufficiency of the evidence to prove actual damages, notwithstanding there was no motion to direct a verdict as to such damages, as required by rule 77 of the trial Court, or that *Page 519 
we undertook to reduce the amount found by the jury. Our judgment was based upon the conclusion that the damages which the jury were allowed to find were not recoverable under the law applicable to the case proved.
The petition is, therefore, dismissed.
MR. JUSTICE FRASER disqualified.