Court Opinion

ID: 7067163
Source: CourtListenerOpinion
Date Created: 2022-07-24 07:27:58.430916+00
Date Added: 2024-06-11T16:12:27.013236
License: Public Domain

*307On Petition for Rehearing.
Moran, J.
It is contended by appellees in their petition for a rehearing that the court was in error in holding (1) that the fourth paragraph of appellees’s answer was insufficient to state a defense to appellant’s complaint; (2) in reversing the judgment even in the event the fourth paragraph' of appellee’s answer was insufficient.
14. The paragraph of answer under consideration is quite lengthy, and in addition to the brief statement of the same in the original opinion it is disclosed, among other things, that after the six wagons and engine were tried, it was found that the outfit could not be made to do the work for which it was purchased, and thereupon the wagons were returned to appellant company, and eight lighter wagons built for and delivered to appellees, which, together with the engine retained by appellees, made up the new outfit. After the new wagons were in appellees’ possession for almost a month, the original notes were surrendered to appellees, except a $500 note which had been paid, and in the execution of the notes in suit, in lieu of the original notes, the payment of the consideration was extended, and appellees relieved from the payment of interest, which had been accumulating for several months. “Where the maker of a promissory note agrees with the payee that if the latter will extend the time of payment for a definite time he will pay the same at the expiration of said period, and the time is so extended such promise of the maker constitutes a new contract, binding in law and capable of enforcement, though the maker may have had a good defense to such note before the agreement to extend was made.” McCormick, etc., Co. v. Yoeman (1900), 26 Ind. App. 415, 59 N. E. 1069.
*30815. It is clear under the circumstances that no fraud-could be predicated on the original agreement that brought about the sale of the wagons aiid the execution of the notes therefor; and if the consideration for the execution of the notes in suit is based upon the extension of time of the payment of the consideration for the first wagons and foregoing the accumulated interest, then a further inquiry is unnecessary, but aside from this, the fourth paragraph of. answer is not good. The original wagons were in appellees’ possession for over four months, during which time appellees attempted to operate the same in their business, and during such time they thoroughly familiarized themselves with the infirmities thereof, as the answer specifically sets forth, wherein the original wagons failed to perform the work for which they were purchased, and their lack of adaptability to the character of the work to be performed. All this information, it is disclosed by the pleading, was obtained by appellees in attempting to operate the original wagons and in observing the agent of the company attempting to do so, and before contracting for the new wagons. The new wagons were similar to the original wagons, differing only in that they were lighter; and before executing the notes in question appellees, as we have seen, had the wagons in their possession, and had an opportunity to test the same, and the infirmity complained of is such that a test would have disclosed the same. Under such circumstances, a person is bound to exercise ordinary diligence. Frenzel v. Miller (1871) 37 Ind. 1, 10 Am. Rep. 62; Furnas v. Friday (1885), 102 Ind. 129, 1 N. E. 296; Anderson Foundry, etc., Works v. Meyers (1896), 15 Ind. App. 385, 44 N. E. 193.
*30916. *308It is contended by appellees that the statements made by the agent of the company as to the char*309acter of the work the wagons would do when built were more than the expression of an opinion. There are exceptions to the general rule that statements of a vendor as to the value, utility, and future use of the property he is selling may be put to, are mere matters of opinion, for instance, “where the vendee is wholly ignorant of the value of the property, and the vendor knows this, and also knows that the vendee is relying upon his (the vendor’s) representation as to value, and such representation is not a mere expression of opinion but is made as a statement of fact, which statement the vendor knows to be untrue, such a statement is a representation by which the vendor is bound.” Murray v. Tolman (1896), 162 Ill. 417, 44 N. E. 748.
Judge Campbell in the case of Picard v. McCormick (1862), 11 Mich. 68, says: “Where a purchaser, without negligence, has been induced by the arts of a cheating seller to rely upon material statements which are knowingly false, * * * it can make no difference in what respect he has been deceived, if the deceit was material and relied on.” The facts that gave rise to this general statement were where a jeweler made false statements to an unskilled purchaser of the value of articles, which none but an expert could be supposed to understand. The facts pleaded in the paragraph of answer under consideration, as we have seen, do not come within the rule announced in the foregoing decisions.
*31017. *309Appellees cite MacClamrock v. Flint (1885), 101 Ind. 278; Fitzmaurice v. Puterbaugh (1896), 17 Ind. App. 318, 45 N. E. 624; Oil Well Supply Co. v. Priddy (1907), 41 Ind. App. 200, 83 N. E. 623; Oil Well Supply Co. v. Watson (1907), 168 Ind. 603, 80 N. E. 157, 15 L. R. A. (N. S.), 868, in support of the proposition that where a manufacturer or dealer contracts to supply an article which he manufactures or *310produces, orin which he deals, to be used for a particular purpose, and the buyer necessarily trusts the judgment of the manufacturer or dealer, there is an implied warranty that the article is. reasonably fit for the purpose for which it is to be used. This principle of lawis well settled and may be invoked, where an issue is tendered raising the question of an implied warranty, as was held in the original opinion, but is not applicable to the paragraph of answer here under consideration, which is drafted on the theocy of fraud.
Appellees cite Hoffa v. Hoffman (1870), 33 Ind. 172, and decisions announcing like principles of law. In this case, it was said, “The false and fraudulent representations as to the capacity of the woolen factory, as to what it had done, and the amount of custom thereto in the past, were matters about which the plaintiff was held in good faith not to misrepresent.” This was a statement made concerning a material fact — what the factory had done in the past, and the extent of its customers. This decision furnishes no support to appellees.
In Conant v. National State Bank, supra, it was said: “The representations of the sellers of the machinery were as to what the machinery would do in the future, and such representations are deemed expressions of opinion, unless facts are averred which give them a different effect. The statements of the seller were not representations of what had been done in the past, but were assertions of what could be done in the future.”
18. Appellees for the first time now insist that the pleading under consideration, if not good as a plea of fraud, is sufficient as an answer of failure of consideration. This does not present any question for a rehearing, not having been presented for consideration at the original hearing, Ewbanks Manual (2d ed.) §242.
*31112. However, the original opinion discloses that while the question was not presented originally, yet an examination was made along this line for the purpose of affirming the judgment, if possible, and the conclusion reached was that the pleading was not good as an answer of failure or want of consideration. It was said by Elliott J. in Neidefer v. Chastain, supra: “The bare general allegation that an article was worthless, thrown into a plea attempting to set up the defense of fraud, can not make good a plea which without it would be bad.' The material, substantive facts pleaded are those upon which the validity of the plea must depend; its sufficiency can not be made to depend upon a sweeping concluding statement that the article was wholly without value. If this were the rule, then every plea attempting the defense of fraud could be made good by adding the general allegation that the article was valueless. * * * To permit this would be to permit sweeping and vague assertions to control specific statements of traversable facts.”
The answer was drafted solely upon the theory of fraud; it was so treated by the court throughout the trial. The court addressed eight instructions to the issue of fraud as joined upon this paragraph of answer, whereby the jury’s attention was called specifically to the principles of law involved in such issue. There was no other issue joined under which the evidence of fraud could have been admitted, nor to which the instructions on the subject of fraud were applicable. In other words, an issue of fraud was tried, when such issue was not properly charged.
The petition for a rehearing is overruled.
Note. — Reported in 110 N.E. 73, 112N.E. 904. See under (1) 11 Cyc 764; (5) 40 Cye 2511, 2514; (7) 3 C. J. 807, 38 Cye 1297; (8) 35 Cye 401; notes, 22 L. R. A. 189; 15 L. R. A. (N. S.) 855. Parol extension of the time for payment of a note, validity, Ann. Cas. 1914A 103.