Opinion
No. 33421.
September 11, 1939. Suggestion of Error Overruled April 8, 1940.
1. JUDGMENT.
The effect of estoppel by a final decree of the Supreme Court of Louisiana is to be determined by the laws of that state where the decree was rendered.
2. JUDGMENT.
A judgment in rem rendered by a court of competent jurisdiction in one state cannot be collaterally assailed in another.
3. JUDGMENT.
A judgment in a proceeding in rem is binding only on the property and rights in the property against which it operates, and as to matters brought before the court and essentially within its jurisdiction, and is conclusive against the parties and all other persons claiming interest in or title to the property proceeded against and having notice of the proceedings, but such judgment will not serve as a basis for any proceeding in a foreign jurisdiction and no rights in personam can be urged under such a judgment in a foreign state.
4. JUDGMENT.
To entitle a judgment in a proceeding in rem in which defendant was not personally served with process and did not appear to full faith and credit in another state, the res must have been attached or seized, or at least have been within the jurisdiction of the court rendering the judgment.
5. JUDGMENT.
Where, in seller's proceeding in rem in Louisiana courts to foreclose mortgage on dragline, buyer's plea in the nature of breach of warranty on ground that machine would not carry load seller represented it would carry was rejected and decree enforcing mortgage was entered in suit in Mississippi to recover balance due on mortgage notes, wherein buyer sought to defeat debt on ground of fraud in that machine would not carry load seller represented it would carry, Louisiana judgment constituted res judicata or estoppel as to buyer's defense, since by changing the name of the facts the cause of action was not changed (Civ. Code La., art. 2286).
ON SUGGESTION OF ERROR. (Division A. April 8, 1940.) [195 So. 322. No. 33421.]1. SALES.
Fraud and deceit in sale of property merely give buyer right to rescind or annul sale, and this right must be exercised with reasonable promptness after discovery that property is not what it was represented to be.
2. SALES.
Where, buyer does not promptly elect to rescind sale for fraud, but continues to use property, implied obligation to pay therefor arises, and, if buyer seeks to meet demand for price by counterclaim for damages, rule as to whether counterclaim is sustained, and, if so, measure of damages, will be the same whether counterclaim is tried on theory of fraud or breach of warranty.
3. JUDGMENT.
Where, in seller's proceeding in rem in Louisiana courts to foreclose mortgage on dragline, buyer's plea in nature of breach of warranty, on ground that machine would not carry load seller represented it would carry, was rejected and decree enforcing mortgage was entered, in suit in Mississippi to recover balance due on mortgage note, wherein buyer sought to defeat debt on ground of fraud in that machine would not carry load seller represented it would carry, Louisiana judgment constituted "res judicata" or "estoppel" as to buyer's defense.
ON MOTION. (Division A. June 3, 1940.) [196 So. 504. No. 33421.]APPEAL AND ERROR.
Where Supreme Court directed that decree be entered for amount stated by original bill to be balance due with interest without noticing that complainant's answer to cross-bill made correction as to balance due, decree would be amended to award recovery of correct balance due with interest, notwithstanding through the five or six months following delivery of original opinion complainant had filed briefs in reply to defendant's suggestion of error but did not mention mistake in amount of decree (Code 1930, sec. 755).
APPEAL from the chancery court of Warren county; HON. J.L. WILLIAMS, Chancellor.
Dent, Robinson Ward, of Vicksburg, Green, Green Jackson, of Jackson, Theus, Grisham, Davis Leigh, of Monroe, La., and Arthur W. Coppin, of Milwaukee, Wis., for appellant.
The judgment rendered in the sixth judicial district court for the parish of East Carroll, Louisiana, affirmed by the Supreme Court of Louisiana, upon the fourteen notes herein sued on, constitutes, as between plaintiff and defendant, a final adjudication as to (a) the amount due — $16,541.00, with interest from August 1, 1930 — on said fourteen notes — without diminution by reason of anything arising from the sixty-foot boom and the two-yard bucket, directly or collaterally — wherefor foreclosure was decreed.
The demand on the fourteen notes was on the same cause of action, between the same parties, in the same quality and the adjudication as to the amount took place with reference to the object of the judgment.
41 C.J. 672; Gardner v. Maxwell, 27 La. Ann. 561; Williams v. Morancy, 3 La. Ann. 227; 19 R.C.L., p. 120 and p. 667, Sec. 482, and Secs. 357, 365; Stark v. Mercer, 3 How. (Miss.), 377, 380; Cobb v. Duke, 36 Miss. 60; 42 C.J. 164; 3 Jones on Mortgages (8 Ed.), 486, Sec. 2034; Dobbins v. Economic Gas Co., 182 Cal. 616, 189 P. 1073; Wardlaw v. Middleton, 156 Cal. 585, 105 P. 738; Murray v. Pearce, 95 N.J.L. 104, 112 A. 314; McMillan v. Teachey, 167 N.C. 88, 83 S.E. 175; Ex parte Cockfield, 118 S.C. 239, 110 S.E. 393; 2 Van Vleet's Former Adjudication, p. 749; Bigelow on Estoppel (6 Ed.), 92; Producers' Naval Stores Co. v. M'Allister (5 C.C.A.), 278 Fed. 13, 31 L.R.A. (N.S.) 1023; State Mut. Bl. L. Assn. v. Batterson, 77 N.J.L. 57, 71 A. 115; Union Cent. Life Ins. Co. v. Saathoff, 115 Neb. 385, 213 N.W. 342; Anderson v. Walsh, 109 Neb. 759, 192 N.W. 328; Pfeffer v. Corey, 211 Iowa, 203, 233 N.W. 126, 128; Smith v. Heppner, 276 Mich. 463, 267 N.W. 882, 884; Mann v. Bugbee, 113 N.J. Eq. 434, 167 A. 202; Mut. Ben. L. Ins. Co. v. Bachtenkircher, 209 Ind. 106, 198 N.E. 81, 104 A.L.R. 1135.
But assume, for the sake of the argument, that the cause of action on the notes to obtain a decree for foreclosure is not upon the same cause of action, yet there having been actual litigation as to the amount of the indebtedness, the amount thus adjudged is conclusive.
Harding Co. v. Harding, 352 Ill. 417, 186 N.E. 152, 88 A.L.R. 569; Note, 88 A.L.R. 575; Adams v. Railroad Co., 77 Miss. 265; Clark v. Norred, 4 La. App. 394; Morgan v. Callahan (La.), 171 So. 135; Sklar Oil Corp. v. Standard Oil Co. (La.), 181 So. 487; Typhoon Fan Co. v. Pillsbury, 166 La. 882, 118 So. 70; Cotton v. Walker, 164 Miss. 208, 144 So. 45; Fair v. Dickerson, 164 Miss. 432, 144 So. 238; Collister v. Loan Assn., 44 Ariz. 427, 38 P.2d 626, 98 A.L.R. 1020, note at 1027; Charles v. Davis, 62 N.H. 375; Ryan v. B. L. Assn., 50 S.C. 185, 27 S.E. 618, 62 Am. St. Rep. 831; Dallas Trust Sav. Bank v. Brashear (Tex.), 39 S.W.2d 148; Dobbins v. Economic Gas Co., 182 Cal. 616, 189 P. 1073; Murray v. Pearce, 95 N.J.L. 104, 112 A. 314; McMillan v. Teachey, 167 N.C. 88, 83 S.E. 175; Henry v. Gant, 75 Ind. A. 218, 129 N.E. 409; Stewart v. Phoenix Nat. Bank (Ariz.), 64 P.2d 101, 107; Mitchell v. State, 179 Miss. 814, 176 So. 743; Hardy v. O'Pry, 102 Miss. 197, 214, 59 So. 73.
Parol evidence is inadmissible to affect the written contract of purchase.
Harnischfeger Sales Corp. v. Sternberg, 179 La. 317, 154 So. 10, 14; 88 A.L.R. 574; Harding Co. v. Harding, 352 Ill. 417, 186 N.E. 152; Ludeling v. Chaffe, 40 La. Ann. 645, 4 So. 586; Hinkle v. McGuire (La.), 182 So. 551; Harnischfeger Sales Corp. v. Sternberg Co., 180 La. 1059, 158 So. 556.
There is no liability arising from warranties contained.
The E-270 (Mass.), 16 F.2d 1005; Renne v. Volk, 188 Wis. 508, 205 N.W. 385; 2 Mechem on Sales 1088, Sec. 254; Reed v. Rea-Patterson Milling Co., 186 Ark. 595, 54 S.W.2d 695; Marsh Wood Products Co. v. Babcock Wilcox Co., 207 Wis. 209, 240 N.W. 392, 398; Bowser Co. v. Birmingham, 276 Mass. 289, 177 N.E. 268, 270; RCA Photophone, Inc., v. Carroll, 174 S.C. 183, 177 S.E. 23; 75 A.L.R. 1080; Ohio Elec. Co. v. Wisconsin-Minnesota L. P. Co., 161 Wis. 632, 155 N.W. 112; Fox v. Boldt, 172 Wis. 333, 178 N.W. 467; Russell Crader Mfg. Co. v. Budden, 197 Wis. 615, 222 N.W. 788; 34 A.L.R. 535, 542.
Alleged wrongful acts of agent do not invalidate contract because: (a) no actionable misrepresentations; (b) the representations being of an agent, without power to do more than submit proposals, are not imputed to the manufacturer who reserved to its chief executive officer the exclusive right to contract, when the proposal expressly provides the extent of the agent's powers, and that it contains all terms of the agreement.
Scott County Milling Co. v. Powers, 112 Miss. 798, 73 So. 792; Ohio Millers Mut. Ins. Co. v. Artesia State Bank, 39 F.2d 400; Cooper v. Robertson Inv. Co., 117 Miss. 108, 77 So. 953; Hirsch Bros. Co. v. Kennington, 155 Miss. 242, 124 So. 350; Tallahatchie Home Bank v. Aldridge, 169 Miss. 597, 153 So. 820; Colt Co. v. Odom, 136 Miss. 651, 101 So. 853.
This action having been brought in Mississippi, the rules of pleading and evidence are those of the forum.
11 Am. Jur. 521, par. 203; 12 C.J. 447; Restatement of the Law, Conflict of Laws, Sec. 597 et seq.; U.S.F. G. Co. v. Yost, 183 Miss. 65, 183 So. 260, 185 So. 564; Colt Co. v. Odom, 136 Miss. 651, 101 So. 853; Colt v. Harris, 177 Miss. 536, 171 So. 697; Tenn. Joint Stock Land Bank v. Bank, 179 Miss. 534, 172 So. 328; Restatement of Law of Agency, Par. 260, Miss. Annotations; 75 A.L.R. 1046.
But, assuming the Mississippi law inapplicable, then the general rule in Louisiana and elsewhere is precisely the same.
3 C.J.S. 152, Sec. 236 (e); Harnischfeger Sales Corp. v. Coats (Cal.), 40 P.2d 875; Harnischfeger Sales Corp. v. Coats, 4 Cal.2d 319, 48 P.2d 662; Speck v. Wylie, 1 Cal.2d 625, 36 P.2d 618, 95 A.L.R. 760; Hill MacMillan v. Taylor, 304 Pa. 78, 155 A. 103, 75 A.L.R. 1022; 2 Am. Jur., Sec. 365; 75 A.L.R. 1046, 1068, Annotation; Hunt v. Hurd, 205 Mich. 142, 171 N.W. 373, 374; Somerville v. Gin Co., 137 Tenn. 509, 194 S.W. 576, 59 A.L.R. 1219, and note; Maxwell Co. v. So. Oregon Gas Corp. (Ore.), 74 P.2d 594, 75 P.2d 9, 114 A.L.R. 703; Kolodzcak v. Peerless Motor Co., 255 Mich. 47, 237 N.W. 41; Barnsdall Refining Corp. v. Birnamwood Oil Co. (7 C.C.A.), 92 F.2d 817; The Nuska, 300 Fed. 231, 11 F.2d 103; Bowser v. Birmingham, 276 Mass. 289, 177 N.E. 268, 270; Barnebey v. Collier (8 C.C.A.), 65 F.2d 864, 866; Lasher v. Laberg, 125 Me. 475, 135 A. 31, 32; Hauer v. Martin, 284 Pa. 407, 409, 131 A. 187.
A failure by the chancery court to enforce said Wisconsin statutes and said Louisiana judgments in accordance with the laws of Wisconsin and Louisiana, respectively, constitutes (1) a deprivation of property without due process of law; and (2) a denial of the full faith and credit clause, both as vouchsafed by the federal constitution.
U.S.F. G. Co. v. Yost, 183 Miss. 65, 183 So. 260, 185 So. 564; Hartford Acc. Ind. Co. v. Delta Pine Land Co., 292 U.S. 143, 78 L.Ed. 1178; Fauntleroy v. Lum, 210 U.S. 230, 52 L.Ed. 1039; Protective Life Ins. Co. v. Lamarque (Miss.), 177 So. 18.
The defendant in opposing the plea of res adjudicata on the ground that the judgment sought thus to be interposed is strictly one in rem loses sight of the character of a judgment in rem. There are two types of judgments in rem: One is the type which results strictly from an attachment or other proceedings which bring the property itself rather than the person of the defendant within the jurisdiction of the court. In such a proceeding the defendant receives no personal service whatever. The proceedings are instituted strictly by taking jurisdiction and physical possession of the defendant's property and bringing it within the jurisdiction of the court, and the theory upon which such a judgment can be rendered is that the court having taken possession of the res itself has jurisdiction to adjudicate all claims upon it without any personal service against the defendant, or any process against the defendant other than by publication or other notice provided under the state law. In such a proceeding the defendant is not before the court, need not personally assert his rights, and any judgment which might be rendered can only operate against the property of which the court had physical possession and jurisdiction. This is the type of judgment in rem which the defendant now urges as having no extra-territorial effect whatsoever. The other type of judgment in rem is a judgment rendered in a proceeding where the court has jurisdiction of the subject matter and of the cause of action, but without having jurisdiction to render a personal judgment against the defendant such as is the case here.
19 R.C.L. 667, Sec. 482; Stark v. Mercer (Miss.), 3 How. 377, 380; Cobb v. Duke, 36 Miss. 60; 34 C.J. 1154; Feltus v. Starke, 12 La. Ann. 798; West Feliciana R.R. Co. v. Thornton, 12 La. Ann. 736.
Both of these last cited cases, it is true, involve suits upon the judgments themselves rather than pleas of res adjudicata based upon these judgments, but they indicate the rule that a judgment from a foreign state will be enforced where there was personal service, and contest made by the defendant such as was the case in the Sternberg judgment upon which we are now relying, and that principle, it seems to us, should certainly apply with equal force to a plea of res adjudicata.
Tait v. Western Md. Ry. Co., 289 U.S. 620, 77 L.Ed. 1405; Blair v. Commissioner, 300 U.S. 9, 81 L.Ed. 469; Watkins v. Miss. State Board of Pharmacy, 154 So. 277, 170 Miss. 26; Morris Co. v. Skandinavia Ins. Co., 161 Miss. 411, 137 So. 110, 278 U.S. 592, 73 L.Ed. 524, 762.
The present case is squarely analogous to the case of Exchange Nat. Bank v. Holoman Bros., 148 So. 702.
The Harnischfeger case was decided January 29, 1934. At that time the supreme court of Louisiana had just decided, May 29, 1933, by unanimous opinion, Exchange National Bank v. Holoman Bros., 148 So. 702, supra, wherein our contention was fully and completely recognized. At the time of the decision of the Harnischfeger case and at the time this suit was filed in Mississippi, the Holoman case constituted the law of Louisiana and was integrated thereinto.
Bank of Philadelphia v. Posey, 130 Miss. 530, 92 So. 840.
The rule universally recognized is that, where rights of property have been acquired in accordance with the law as declared by a decision of a court of last resort, a subsequent decision, overruling the prior decision and reversing the rule of law thereby established, will not be allowed to retroact so as to destroy such rights.
Wisc. Lbr. Co. v. State, 97 Miss. 571, 54 So. 247; Burgess v. Seligman, 107 U.S. 20, 27 L.Ed. 359.
Brunini, Wright Brunini, of Vicksburg, and O'Niell O'Niell, of New Orleans, La., for appellee.
The plea of res adjudicata was not mentioned in plaintiff's brief before the chancellor except to say that they had "consumed more space than we had originally intended and since we feel that, even in the absence of plea of res adjudicata, the complainant is entitled to a judgment against defendant, Sternberg Dredging Company, in accordance with the prayer of its petition, we shall spare the court any further discussion of this question."
Ourselves and no doubt the chancellor too were under the impression, and had the right to assume, that the plea had been abandoned. We cannot help but feel, therefore, that appellant is now grasping at a straw in urging the plea so strenuously at this late date, "en dernier ressort," so to speak.
It is fundamental that a judgment in rem against the property of a non-resident is operative only against the thing and cannot serve as the basis of a plea of res judicata in a subsequent suit in another state between the same parties. Especially is this true under Louisiana law. The rule is founded upon the common-sense proposition that a judgment can have no greater force in another jurisdiction than it had in the state of its rendition. If the court which rendered the judgment had no power to make it operative in personam, by what token can such a judgment be so operative in a foreign state by simply urging it as the basis of a plea of res judicata?
Hodges Co. v. Pa. R.R. Co., 171 La. 699, 132 So. 115; Old Wayne Mutual Life Assn. v. McDonough, 204 U.S. 22, 51 L.Ed. 345, 27 S.Ct. 236; Simon v. So. Ry. Co., 236 U.S. 115, 35 S.Ct. 255; 59 L.Ed. 492.
The rule is fundamental that a judgment in rem against a nonresident, rendered by a court that is without jurisdiction to render a judgment in personam, is operative only against the res and has no extra-territorial force or effect whatever. Such a judgment can never be urged as res judicata in another jurisdiction.
Pennoyer v. Neff, 95 U.S. 714, 24 L.Ed. 565; Feltus v. Starke, 12 La. Ann. 798; 34 C.J. 1147, 1154; Spencer v. Sloo, 8 La. 290; 42 A.L.R. 485; Re Longshore's Will, 188 Iowa, 743, 176 N.E. 902.
The only question that the Louisiana supreme court decided on the merits of the plaintiff's claim in Louisiana was a rule of evidence. The defendant contended that the oral evidence of breach of warranty was admissible under the common law exception to the parole-evidence rule to the effect that oral representations unattended by fraud yet forming the inducement to enter into the written contract are admissible though not entirely consistent with the writing. The supreme court of Louisiana held, however, that the court was bound by Article 2276 of the Civil Code, which did not admit of any such exception.
The present suit having been brought in the courts of Mississippi, the rules of evidence pertinent therein are those of the forum, which in this instance, are the rules obtaining in Mississippi. The exception to the parol evidence rule which we urged the supreme court to adopt was well established in the common law states.
The supreme court demonstrated very clearly that it was not free to adopt the common law exception which Sternberg contended for, for the reason that Article 2276 really left it no discretion.
We submit that a case of mere breach of warranty is not at all identical to a case of actionable fraudulent deceit.
Wallace v. Hallowell, 56 Minn. 501, 58 N.W. 292; Smith v. Bolles, 132 U.S. 125, 10 Sup. Ct. 39, 33 L.Ed. 279; Sigafus v. Porter, 179 U.S. 116, 21 Sup. Ct. 34, 45 L.Ed. 113.
It is bound to be conceded that whatever force or effect the judgment should have as res judicata must be governed by Louisiana law; this for the fundamental reason that a judgment cannot conceivably have any greater force in a foreign jurisdiction than it would have in the state where it was rendered. This rule of conflict of laws prevails everywhere.
34 C.J. 1128; Soniat v. White, 155 La. 290, 99 So. 223; Scovel v. Levy's Heirs, 118 La. 993, 43 So. 642.
In Louisiana a judgment cannot be pleaded as res judicata except as to the issues raised and decided in the former suit. The rule that prevails in some of the common law states to the effect that a judgment precludes any issue that might have been pleaded, does not prevail in Louisiana.
Woodcock v. Baldwin, 110 La. 270, 34 So. 440; Brooklyn Cooperage Co. v. Cora Planting Mfg. Co., 137 La. 814, 60 So. 195; Tennent v. Caffery, 163 La. 989, 113 So. 167; Am. Machinery Const. Co. v. Haas, 127 La. 817, 54 So. 38; Smith v. Little Pine Lbr. Co., 150 La. 729, 91 So. 165; Uncle Sam Planting Mfg. Co. v. Reynaud, 169 La. 208, 124 So. 827; State v. City of New Orleans, 169 La. 374, 125 So. 273; Succession of Marinoni, 183 La. 778, 164 So. 797.
The Marinoni case, decided November 4, 1935, is the Louisiana law on this question. Therefore, even aside from the fact that the judgment was strictly in rem, and then only on a question of evidence Sternberg is not precluded from setting up an action for fraudulent representations by having failed to do so in the Louisiana suit. Under Louisiana law, there was no necessity to couple a defense of breach of warranty with an action for fraudulent deceit.
The contract of sale which complainant relies on to exclude the oral evidence was prepared in printed form by the seller and is in the form of a proposal to sell. (Note that there is not a word in the contract stating the capacity of the machine). The contract calls for shipment "to be specified at later date from receipt of your acceptance of this proposal and approval of same by an officer of this corporation," the complainant.
The rule as to parol evidence is utterly inapplicable to a case such as this, where the only existing agreement between the parties at the time the contract was performed consisted of parol. In such a case, the only character of evidence available to either party is necessarily parol evidence.
Bell v. Mulkey (Tex.), 7 S.W.2d 117, 248 S.W. 785, 16 S.W.2d 287; Smith v. Hildenbrand, 15 Misc. 429, 36 N.Y.S. 485; Bank of Evansville v. Kirth, 167 Wis. 43, 166 N.W. 658; Anderson Trading Co. v. Brady, 184 N.Y.S. 383, 193 App. Div. 681.
The representations of warranty would be admissible, even if the written contract had been in effect when the sale was made, (and even aside from the question of fraud which will be discussed later), because the representations were contemplated to induce, and did induce, Sternberg to enter into the written agreement.
Harnischfeger Sales Corp. v. Coats, 48 P.2d 622; 22 C.J. 1253.
Parol evidence is admissible to establish a contemporaneous oral agreement which induced the execution of a written contract though it may vary, change, or reform the instrument.
Ferguson v. Rafferty, 128 Pa. 337, 18 A. 484, 6 L.R.A. 33; Empire Buggy Co. v. Moss, 154 S.C. 424, 151 S.E. 788; Sharrar v. Wayne Savings Assn., 246 Mich. 225, 224 N.W. 379; Price v. Advance-Rumley Thresher Co. (Tex.), 264 S.W.2d 113; Norm Co. v. City Drug Stores, 59 S.W.2d 270; In re Hartman, 166 Fed. 776; Ind. Truck Corp. v. Glock, 46 Ga. App. 519, 168 S.E. 124; Heitman v. Clancy, 167 Iowa, 58, 148 N.W. 1011; Hurless v. Wiley, 91 Kan. 347, 137 Fed. 981, L.R.A., 1915C, 117; Hughes v. Crooker, 148 N.C. 318, 62 S.E. 429, 128 Am. St. Rep. 606; Boynton v. Johnson, 68 Wn. 370, 123 P. 522; Walker v. France, 112 Pa. 203, 5 A. 208; Glass v. O'Toole, 36 Ohio App. 450, 173 N.E. 214; Palmetto Bank Tr. Co. v. Grimsley, 134 S.C. 493, 133 S.E. 437, 51 A.L.R. 42.
Pretermitting all else, it cannot be denied that the evidence is admissible as a fraudulent representation. And the clause in the contract providing "that there are no understandings, representations, or agreements between the parties not herein expressed" affords complainant no protection.
Harnischfeger Sales Corp. v. Coats, 48 P.2d 663, 4 Cal.2d 319; Wigmore on Evidence (2 Ed.), Sec. 2439; Jones v. Brandt, 173 Wis. 539, 181 N.W. 813.
It may be shown by parol that a written contract was procured through fraudulent representations.
Howie Bros. v. Walter Pratt Co., 83 Miss. 15, 35 So. 216; Patten-Worsham Drug Co. v. Planters' Mercantile Co., 86 Miss. 423, 38 So. 209; Henry v. W.T. Rawleigh Co., 152 Miss. 320, 120 So. 188; Nash Miss. Valley Motor Co. v. Childress, 156 Miss. 157, 125 So. 708; Ferguson v. Koch, 268 P. 342, 204 Cal. 342, 58 A.L.R. 1176; Lizana v. Edward Motor Sales Co., 141 So. 295; Barber v. Loveland, 146 So. 854; Bullard v. Citizens Nat. Bank, 160 So. 283; Miss. Power Co. v. Bennett, 161 So. 308; Citizens Nat. Bank v. Golden, 166 So. 748; Citizens Nat. Bank v. Pigford, 166 So. 752; Citizens Nat. Bank v. Allen, 167 So. 629; Angerosa v. White Co., 248 App. Div. 425, 290 N.Y.S. 211; Jones v. West Side Co., 231 Mo. App. 187, 93 S.W.2d 1086; Northwestern Mfg. Co. v. Leftwich Hardware Co., 176 Ark. 212, 2 S.W.2d 1109; Elgin Jewelry Co. v. Withaup Co., 118 Mo. App. 126, 94 S.W. 572; Florimond Realty Co. v. Waye, 268 Mass. 475, 167 N.E. 637; Arnold v. Nat. Aniline Chemical Co., 20 F.2d 364, 56 A.L.R. 11; Nat. Equipment Corp. v. Volden, 252 N.W. 445, 190 Minn. 596; Nalley Co. v. Moore, 51 Ga. App. 718, 181 S.E. 429; Sharkey v. Burlingame Co., 131 Or. 183, 282 P. 546; Advance-Rumley Thresher Co. v. Jacobs, 4 P.2d 658, 51 Idaho 160; J.I. Case Co. v. Bird, 51 Idaho 725, 11 P.2d 966; Wolf Co. v. Smith Mercantile Co., 189 N.C. 322, 127 S.E. 208; Ala. Machinery Supply Co. v. Caffey, 213 Ala. 260, 104 So. 509; Universal Fashion Co. v. Skinner, 64 Hun 293, 19 N.Y.S. 62; Smith v. Hildenbrand, 15 Misc. 429, 36 N.Y.S. 485; Land Finance Corp. v. Sherwin Electric Co., 102 Vt. 73, 146 A. 72, 75 A.L.R. 1041, 1047, 1062; People's Auto Co. v. Staples, 143 So. 553, 225 Ala. 366; Watson v. Rigali Veselich, 33 P.2d 455, 138 Cal. 760; Noel v. Kessler, 97 A. 446, 252 Pa. 244; Bennett v. Burch-Buell Motor Corp., 224 N.Y.S. 666, 221 App. Div. 517; Baylies v. Vanden Boom, 278 P. 551, 40 Wyo. 411; Banker's Mortgage Co. v. Rogers (Tex.), 61 S.W.2d 593; Duralith Corp. v. Van Houten, 174 A. 484, 113 N.J.L. 374; Singer Sewing Machine Co. v. Cole, 63 S.W.2d 977, 187 Ark. 1017; White Sewing Machine Co. v. Gilmore Furniture Co., 105 S.E. 134, 128 Va. 630; Rodgers v. Simons Sales Co., 227 Mich. 695, 199 N.W. 683; Griesa v. Thomas, 99 Kan. 335, 161 P. 670; Smith Co. v. Morgan, 152 Ky. 430, 153 S.W. 749; Tiffany v. Times Square Auto Co., 168 Mo. App. 729; J.I. Case Threshing Co. v. McKay, 161 N.C. 584, 77 S.E. 848; Hetrick v. Gerlinger Motor Car Co., 84 Or. 133, 164 P. 379; Holcomb Mfg. Co. v. Auto Interurban Co., 140 Wn. 581, 250 P. 34, 51 A.L.R. 39; National Cash Register Co. v. Midway City Creamery Co., 49 N.D. 441, 191 N.W. 762; Arnett v. Sanderson, 25 Ariz. 433, 218 P. 986; Omar Oil Gas Co. v. Mackenzie Oil Co., 33 Del. 259, 138 A. 392; Bonewell v. Jacobson, 130 Iowa 170, 5 L.R.A. (N.S.) 436, 106 N.W. 614; Ganley Bros., Inc., v. Butler Bros. Building Co., 170 Minn. 373, 212 N.W. 602, 56 A.L.R. 1.
Fraud vitiates all things, even sweeping away the rule of parol evidence, that you cannot vary, add to or amend a written contract by parol testimony.
Howie v. Pratt, 83 Miss. 15, 35 So. 216; Drug Co. v. Mercantile Co., 86 Miss. 423, 38 So. 209; Hirschburg v. Jackson, 63 Miss. 21; Hutson v. Miller, 148 Miss. 783, 114 So. 820; McNeer Dodd v. Norfleet, 113 Miss. 611, 74 So. 577, Ann. Cas., 1918E, 436; Salter v. Aviation Salvage Co., 129 Miss. 217, 91 So. 340, 26 A.L.R. 987; Stone v. Pounds, 126 Miss. 671, 88 So. 629, 89 So. 652; Myers v. Farrell, 47 Miss. 281; Staton v. Bryant, 55 Miss. 261; Patten-Worsham Drug Co. v. Planters' Mercantile Co., 86 Miss. 423, 38 So. 209; Vincent v. Corbitt, 94 Miss. 46, 47 So. 641, 21 L.R.A. (N.S.) 85; Sims v. Eiland, 57 Miss. 607; Isaacs v. Hermann, 49 Miss. 449; Barwick v. Moyse, 74 Miss. 415, 21 So. 238; Pope v. Andrews, S. M., Ch. 135; Hilliard v. Cagle, 46 Miss. 309; Strong v. Hines, 35 Miss. 201; Parkhurst v. McGraw, 24 Miss. 134.
Since the description of the machine contained in the written contract is ambiguous and contains not the remotest mention of the machine's capacity, the parol representations were admissible to explain the ambiguity.
Bixler v. Brim, 206 Ill. App. 294; Less v. Alport, 217 Ill. App. 14; Ventura Mfg. Implement Co. v. Warfield, 37 Cal.App. 147, 174 P. 382; Inner Shoe Tire Co. v. Tondro (Cal.), 83 Cal.App. 689, 267 P. 211; In re Hartley (Ga.), 29 F.2d 916; International Ticket Scale Corp. v. International Ticket Scale Corp. of Chicago, Ill. et al. (7 C.C.A.), 56 F.2d 969; Valparaiso Hotel Co. v. Schneider, 100 Ind. App. 341, 195 N.E. 589; Robben et al. v. Farmers' Co-operative Co., 128 Kan. 310, 278 P. 10; Vinegar Bend Lbr. Co. v. Churchwell, 123 Miss. 807, 86 So. 299; National Foods, Inc. v. Friedrich, 173 Miss. 717, 163 So. 126; Weiss v. Gross, 11 N.J. Misc. 41, 165 A. 90; William H. Waters, Inc., v. March (N.Y.), 269 N.Y.S. 420, 240 App. Div. 120; Jordan v. Madsen, 74 Utah 280, 279 P. 499; Fox Film Corp. v. Ogden Theatre Co., 82 Utah, 279, 17 P.2d 294; Firestone Tire Rubber Co. v. Werner, 204 Wis. 306, 236 N.W. 118; Allen et al. v. Allen et al., 175 Miss. 735, 168 So. 658.
Argued orally by Garner Green and Thomas Leigh, for appellant, and by John Brunini, for appellee.
Harnischfeger Sales Corporation appeals from an adverse judgment of the chancery court, in which court it initiated proceedings against the appellee, Sternberg Dredging Company, to recover a balance due on a series of notes, the principal of which was in excess of $16,000, and the balance of which alleged to be due after credits allowed thereon was $9,876.07, interest included to December 4, 1934.
The jurisdiction of the chancery court was obtained by means of garnishment proceedings against the defendants, appellees here, who are alleged to be indebted to the appellant.
Both corporations are non-residents of this state.
Sternberg Dredging Company filed its answer to the suit, in which the indebtedness, evidenced by the notes exhibited with the bill, was denied, and a cross-bill was filed against the appellant company in which it was alleged that these notes were executed by the Sternberg Dredging Company as a part of the consummation of the sales contract by which the appellant, Harnischfeger Sales Corporation, sold to the appellee company one Model 775-A Diesel dragline, with standard 50-foot boom and 10-foot extension — and Model E Kohler 1500-Watt Lighting Plant, to be installed in the plant of appellee. The price for the equipment was $26,630 and the terms of payment were $3,000 cash, and the balance in twenty promissory notes, payable monthly, dated August 1, 1930, secured by a chattel mortgage on the machine. The cash payment was made, the notes executed, and several of the notes paid.
Sternberg Dredging Company contended that the machine would not do the work for which it was bought, that of building levees along the Mississippi River in Louisiana and Arkansas. This machine was delivered to the Sternberg Dredging Company by the appellant at Eudora, Arkansas. The complaints against the machine are set out in detail, unnecessary to be recited here.
The real defense to the notes is, in substance, as follows: That before the execution of the sales contract and the notes, the salesmen of the appellant knew the purpose for which the appellee was buying the machine, the president thereof having told them that a machine with a sixty-foot boom, which would operate a two-yard bucket, was wanted, and that before entering the contract, the appellee was assured that the machine described would operate a two-yard bucket, when, in truth and fact, the machine never did operate a bucket of that capacity. The plea, with the answer and cross-bill, in effect, set up that there had been a breach of warranty on the part of the seller making these oral representations and sought to recover damages as against the seller in favor of the buyer in the sum of $22,000.
The appellant filed its answer to the cross-bill denying all the material allegations therein, and further interposed, as part of its answer, a plea of res adjudicata, setting up in detail the litigation had between it and the appellee in the State of Louisiana, and exhibiting and offering in evidence a full and complete record of all the proceedings in the Louisiana case, including the entire record of the cause appealed from the lower court to the Supreme Court, together with the opinion rendered by that court in that case. As briefly as can be stated, the plea of res adjudicata set forth that in the district court of Louisiana, proceedings had been instituted by the Harnischfeger Sales Corporation against the Sternberg Dredging Company to enforce a chattel mortgage as against the machine, and prayed for a personal judgment for the amount of the notes, then alleged to be about $16,000, the chattel mortgage and notes having been executed by the Sternberg Dredging Company at its office and domicile in Missouri, and delivered to Harnischfeger Sales Corporation at its office in Wisconsin. A writ of sequestration was issued by the lower court in Louisiana, and the machine seized.
In the Louisiana proceedings, the Sternberg Dredging Company appeared and entered a motion to dismiss the cause for want of jurisdiction — both parties being non-residents and the contract not having been executed in the State of Louisiana. This plea was overruled by the lower court. Thereupon the Sternberg Dredging Company, as a defense to the proceeding, plead substantially the same facts as are set forth in the Mississippi proceeding, the case here at bar, to-wit, a breach of the oral representation as to the adaptability of the machine to carry a two-yard-bucket load. The lower court there heard the evidence in the entire case and rendered a decree adjudging that the Sternberg Dredging Company was indebted to the appellant for the full amount of the notes then unpaid, directing that the machine involved be sold for the payment of said debt, and also rendered a personal decree for the amount of the notes against the Sternberg Dredging Company.
On its appeal to the Supreme Court, that Court held that the decree of the lower court enforcing the mortgage lien was proper; and it further held that it was proper and necessary for the court to ascertain and decree the amount of the indebtedness against the machine and affirmed that part of the decree. But the Court held further that the lower Court in Louisiana did not have jurisdiction to render a personal decree against the Sternberg Dredging Company for the amount due on the notes — that it was a judgment in rem in that particular. It further held that the lower court had jurisdiction to ascertain whether anything was due on the notes; and in a full and complete discussion of the defense offered on the incapacity of the machine to carry a two-yard bucket, that Court found that the plea was not sustained and approved the action of the lower court in excluding the evidence with reference thereto. See Harnischfeger Sales Corporation v. Sternberg Co., Inc., 179 La. 317, 154 So. 10.
Subsequently, according to the Louisiana record, the machine was sold in the manner prescribed by the decree, and at the sale thereof, Sternberg Dredging Company bought the machine for $8,000, the writ of the officer showing the collection of that amount and the application of the balance, after paying costs, to the indebtedness sought thus to be enforced.
About six months after the plea of res adjudicata was interposed by the appellant, the appellee amended its pleadings so as to charge that misrepresentation of facts by the agent as to the sixty-foot boom with a two-yard bucket constituted a fraud and misrepresentation in the following language: "That the said complainant (Harnischfeger Sales Corporation) well knowing that said dragline was not so constructed as to do the work for which it was purchased, and that it could not successfully be operated, still induced defendant Sternberg Dredging Company to purchase the same; that these representations and inducements, with full knowledge of the facts, were a fraud upon your respondents and vitiates the said contract."
On the motion of the appellee, the court struck from the record the plea of res adjudicata, and also excluded the record of the Louisiana proceedings, and the case was then heard on the plea of fraud and deceit, namely, in that oral representation was falsely made which induced the appellee to enter into the contract. The evidence was conflicting on this point. The chancellor held the evidence competent and entered a decree dismissing the original bill and the cross bill, thereby holding that the damages alleged to have been sustained by the pleading and proof by the Sternberg Dredging Company would be allowed in a sufficient amount to extinguish the claim of the Harnischfeger Sales Corporation, but that the Sternberg Dredging Company not being entitled to a rescission at that late date could not recover anything over against the Harnischfeger Sales Corporation.
The record in this case is voluminous, and likewise the briefs, and many points are discussed. Two questions are presented by the appellant corporation for decision, which are, in substance, as follows: (1) That the Louisiana proceedings constituted res adjudicata or estoppel as against Sternberg Dredging Company to again set up the defense and representations as to the two-yard bucket; and (2) that all the allegations and proof as to fraud and deceit for material representations were incompetent in the light of the peculiar language of the written sales contract.
We shall only consider the first question — that the Louisiana litigation constitutes res adjudicata or estoppel as to the defense sought to be interposed in the Mississippi court.
It is to be stated with reference to the facts that practically the same evidence was offered in both proceedings by the Sternberg Dredging Company as to the breach-of-warranty theory. The case on the evidence offered by the appellee is perhaps stronger, but it tends to the same ultimate conclusion. In the Mississippi Court, in the case at bar, the appellee changed its pleading subsequent to the filing of the plea of res adjudicata. The proof in both cases tended to establish the same ultimate fact, and it is unnecessary for us to detail the evidence.
In the appellate court in the State of Louisiana, the appellee presented two major propositions: First, that the trial court did not have jurisdiction to enter a judgment in rem nor to enter against it a personal decree or money judgment; and, second, that the lien should not be enforced because the proof sustained its plea that the representations and warranties made by the salesmen of Harnischfeger Sales Corporation constituted a complete defense, and there being no debt, there could be no lien enforced in Louisiana. On the first proposition, the Louisiana Court, held with the appellee only as to a personal decree for the debt; on the second proposition the court held against it. An examination of the record shows that if that Court held that the evidence as to representation and breach of warranty were admissible, Sternberg Dredging Company would have established damages according to its theory in excess of $18,000, more than enough to extinguish the debt. We have here, then, a case where a non-resident defendant sought to prevent the enforcement of a lien on the dragline machine by the Courts of Louisiana on the ground of a breach of a warranty, because the machine was not capacitated to operate a two-yard bucket, this plea, in effect, being denominated a breach of warranty in the Louisiana courts, while in the Mississippi court, in order to defeat the debt, the appellee finally determined to name the same facts as constituting fraud and deceit.
At the outset we will state that the effect of the estoppel by the final decree of the Supreme Court of Louisiana is to be determined by the laws of that state where the decree was rendered, and this seems to be an accepted and universal rule. Restatement, Conflict of Laws, Section 450.
In the statement of the case it will be observed that the appellee, Sternberg Dredging Company, did not in the trial or appellate courts of Louisiana rest its defense upon the want of jurisdiction to enter a personal decree against it for the amount due on the note, but it contended that the court did not have jurisdiction to enforce the chattel mortgage lien, both parties being non-residents and the contract having been executed and completed in another state; and that if the court had jurisdiction, then the lien could not be enforced because it owed no debt on account of its cause of action for damages. In other words, on its defense to the enforcement of the chattel mortgage lien, appellee appeared in that court, offered its defense, and resisted to the utmost the enforcement of the lien in the Louisiana Court for the reasons we have stated. The ultimate facts as to whether or not a debt existed that would authorize the enforcement of a lien are the same in both the Louisiana and the Mississippi courts. The litigation was between the same parties, the same subject, the only difference in the pleas and proof in the two courts being a change in the name of the pleading. The same cause of action was alleged in the Louisiana Court as was interposed and allowed by the lower court in this state, and that cause of action was, when the case is stripped to the bone, that the machine delivered would not and did not carry a two-yard bucket, and by this we understand it to mean that the machine was not capacitated to be filled with two yards of earth and successfully dumped therefrom.
It is said that the Louisiana decree cannot operate as res adjudicata or estoppel because the Supreme Court held that the proceeding was in rem. 179 La. 317, 154 So. 10. The appellant, Harnischfeger Sales Corporation, is not seeking here to bring a suit on the contention that the Louisiana judgment and action of that court, on the defense thereto, operated as a judgment which concluded the parties as to the amount of the judgment. The contention of the appellant is, as we understand it, that the Sternberg Dredging Company interposed the same defense in the Louisiana court as it interposed in the case at bar, and as to that defense the doctrine of res adjudicata is interposed and effective to conclude it, even though the proceedings in Louisiana to enforce a chattel mortgage on the thing mortgaged in that state were in rem. The appellee had its option to stand on the want of jurisdiction of the Court, but it did not do so. It appeared there. Sternberg, the main witness in both trials, testified to the same salient facts as to this defense in the Louisiana court as was testified by him in the Mississippi Court in the case at bar. We are of the opinion that the defense was adjudged and concluded as to that defense and that every court everywhere would be bound to so hold. We think in the mere statement of the case we demonstrated that the cause of action in the two states was the same so far as the Harnischfeger Sales Corporation was concerned.
Many authorities are collated by both sides, but our attention has not been called to a case where a defendant in a proceeding in rem against him appeared in court and by plea sought to defeat the proceeding in rem to enforce a chattel mortgage because of a particular defense thereto which, if successful, would defeat the debt, and, of course, thereby prevent the enforcement of any lien. The cases cited are those in which there was no appearance by the defendant and no issue raised and actually litigated. Without the debt the lien was not enforceable, as to which there is no conflict in the authorities anywhere.
We are of opinion that the statement of the rule cannot be found stated with any more clarity than that contained in 34 Corpus Juris, Section 1636, p. 1154: "Judgments in Rem — In General. A judgment in rem, rendered by a court of competent jurisdiction in one state, cannot be collaterally assailed in another. But to entitle a judgment in a proceeding in rem, in which defendant was not personally served with process, and did not appear (italics ours), to full faith and credit in another state, the res must have been attached or seized, or at least have been within the jurisdiction of the court rendering the judgment. A judgment thus rendered is binding only on the property and rights in the property against which it operates, and as to matters brought before the court and essentially within its jurisdiction. It is conclusive against the parties, and all other persons claiming interest in or title to the property proceeded against and having notice of the proceedings. Such a judgment will not serve as a basis for any proceeding in a foreign jurisdiction, and no rights in personam can be urged under such a judgment in a foreign state. It will not be a bar to an action in another state to enforce a personal liability on the original cause of action."
When the Sternberg Dredging Company decided and elected to resist the entry of any decree in rem against the machine and to interpose the breach-of-warranty defense, it thereby concluded itself irrevocably. Suppose the Louisiana Court had taken the opposite view and had determined in the court of last resort that the defense was valid in that it extinguished the debt? By that decree it would have retained the machine free from the lien; and, certainly where both parties appeared and contested the issue, debt or no debt, because of a breach of warranty, that decree would be final and conclusive on that issue actually litigated, and we think under the statute controlling in Louisiana would be res adjudicata. Such statute is as follows: "The authority of the thing adjudged takes place only with respect to what was the object of the judgment. The thing demanded must be the same; the demand must be founded on the same cause of action; the demand must be between the same parties, and formed by them against each other in the same quality." Art. 2286, Louisiana Civil Code.
It appears to us that whatever may be said about the decisions of the Louisiana court in the construction of this statute, the claim interposed in the case at bar — that is by counter-claim — wherein Sternberg Dredging Company sought to extinguish the debt by plea and proof of a breach of warranty on the cause of action, that the bucket would carry two yards of earth when in actual operation such warranty failed because the bucket would not so function, the same claim is here res adjudicata. We think there is no merit in the contention that by changing the name of the facts the cause of action was changed; and we have examined all the authorities cited from that Court on that question and can find no reason for saying that the cause of action was not identical. In the Louisiana Court the Sternberg Sales Company undertook to recover on its counter-claim the amount of its debt to appellant as damages in Mississippi. In the lower court it has so far successfully done that on the same facts that were litigated in Louisiana. There is no difference in quality, person, or cause of action.
In several cases in Louisiana that Court has used the language in construing the above statute: "Res adjudicata includes everything pleaded in a cause, and also that which might have been pleaded." See Exchange Nat. Bank v. Holoman Bros., 177 La. 537, 148 So. 702. But in Tennent v. Caffery, 163 La. 976, 113 So. 167, 172, that statement was modified in this language: "In Woodcock v. Baldwin, 110 La. 270, 275, 34 So. 440, 441, it was said that: `The doctrine of the common-law courts that res judicata includes not only everything pleaded in a cause, but even that which might have been pleaded, does not obtain generally under our system.'"
Counsel for appellee relies strongly on the case, Succession of Marinoni, 183 La. 776, 164 So. p. 797. In the original opinion in that case, 177 La. 592, 148 So. 888, 898, the court held where a party sought to inherit in that state, basing her right thereto on a common-law marriage in Mississippi, which suit failed, and she later brought a suit on a statute which permitted a child to inherit on the putative marriage of the parents, the second suit was concluded under the statute of that state as to res adjudicata, but upon a rehearing of the case the Court concluded that a suit upon the common-law marriage in Mississippi was not the same cause of action as a suit upon the right to inherit under a statute of Louisiana. However, the case was decided by a divided court, the majority opinion being concurred in by four judges, and three judges dissenting. We are not here confronted with that factual situation. Here the same facts were presented and the same object sought to be attained as was sought to be obtained in the Louisiana Court — to defeat a judgment because of the failure of the machine to carry a bucket of a certain size. We do not stop to undertake to analyze what the court meant by the use of the words that the common-law rule "does not prevail generally in the state of Louisiana." We do not think the Louisiana Court could have reached the conclusion that the cause of action instituted by the appellee against the appellant in our court is different from that actually litigated in the lower and Supreme Court of that State.
We are, therefore, of the opinion that the court below erred in striking the plea of res adjudicata and declining to allow it as an estoppel to the defense here involved. The appellant is entitled to a decree here for the amount sued for, with six per cent interest from December 4, 1934. This opinion disposes of the appeal and cross appeal.
Reversed, and judgment for appellant.
ON SUGGESTION OF ERROR.
In the Louisiana court, in the original proceeding there, the Sales Corporation averred that its debt, for the recovery of which that suit was instituted, amounted to approximately $16,000, the debt being evidenced by a series of notes, secured by a chattel mortgage. The Dredging Company there appeared and presented as its defense against the debt, a counterclaim for damages and adduced substantially the same evidence which has been presented in the present case, under which, if its claim for damages for what it then called a breach of warranty had been sustained, it would have owed the Sales Corporation nothing; and no decree could have issued against the Dredging Company, for, as we pointed out in our original opinion, it was necessary for the Louisiana court to find and adjudge that the debt demanded by the Sales Corporation was due and owing by the Dredging Company, else it could not have ordered the sale of the encumbered property. The ultimate issue whether the debt existed and was due was a necessary and vital issue, without the determination of which in the affirmative favor of the Sales Corporation no further adjudication could be made, save to dismiss the entire proceeding. The debt issue was not one which that court could have laid to one side, and still have proceeded with other features of the case.
But whether the debt existed, and was due in the full amount demanded, depended upon whether the counterclaim interposed by the Dredging Company was sustained under the facts, and that issue was there fully heard. The Louisiana court held that the counterclaim was without sustainable merit either in part or as a whole, and furnished, therefore, no obstacle to the enforcement of the debt.
The argument by the Dredging Company now further pressed is that inasmuch as the counterclaim interposed in the Louisiana court against the demand there made for the purchase price of the machinery and for its enforcement by sale of the mortgaged chattel was one for a breach of warranty — that is to say, a defense which recognized the sale contract as valid, but sought to defeat the balance of the purchase price because of damages incurred in the use of the machinery founded upon the alleged fact that the machinery would not do in that use what it was warranted to do — the proceedings there involved only contractual relations. That here the procedure under the amended pleadings sounds in tort; that here the demand is that the contract of purchase be declared null because of the fraud and deceit of the seller in procuring it; and that, therefore, the counterclaim there tried was on one cause of defense in point of substantive right, while here it is upon a different cause having a different substantive foundation.
But fraud and deceit in the sale of property operates only to give the buyer the right to elect to rescind or annul the sale, and this right of election must be exercised with reasonable promptness after discovery that the property is not what it was represented to be. When the buyer does not promptly so elect and make his election effective but continues to use the property, as was the case here, the law of all the states will interpose, by implication, an obligation to pay for the property so retained and used; and when in such case the buyer seeks to meet a demand for the price of the property by way of counterclaim for the damages caused to him in the use, the rule as to whether the counterclaim is sustained, and if so the measure of the damages, will be the same whether the counterclaim is tried on the theory of fraud and deceit by the seller as to what machine will do in its use or whether on the theory of breach of warranty.
The issue which was tried in the Louisiana court was the counterclaim of damages interposed by the buyer, and it was there called a counterclaim for damages for breach of warranty, and there it was held that the counterclaim was not sustained on the facts. Here the same counterclaim of damages is interposed by the buyer on substantially the same evidence of the facts; and it is insisted that we should reverse the findings of the Louisiana court on the same facts on the same counterclaim, because here the name given the counterclaim is different from that given it in the Louisiana court.
Let us suppose that, on the counterclaim, the issue had been decided by the Louisiana court in favor of the Dredging Company and in consequence had adjudged that no debt was due by it to the Sales Corporation, would the latter have been permitted to come thereafter to this State and relitigate here its alleged, but dead, debt?
After a prolonged and laborious examination of the Louisiana cases, including the recent opinion in Hope v. Madison, 194 La. 337, 193 So. 666, we believe none has gone so far as to sanction what is attempted to be done here when the cases in that jurisdiction are examined on their exact facts. And since no case from the Louisiana courts precisely similar to the present case upon the facts has been shown us, we have concluded, as we did before, that such cases as Exchange, etc., Bank v. Holoman, 177 La. 537, 148 So. 702, come nearest and furnish us the best guide to follow.
Suggestion of error overruled.
ON MOTION.
With the original bill in this case, copies of all the purchase money notes given by appellee were exhibited and the only credit and the amount thereof was stated in the bill. The prayer of the bill demanded the recovery of a balance of $9,876.07, with interest thereon from the date of the filing of the bill which was December 4, 1934. There was never any dispute between the parties as to the execution of these notes or as to their amounts or interest provisions or as to the admitted credit and the amount thereof, the litigation revolving entirely around other issues.
In preparing the original opinion, Miss., 191 So. 94, wherein the litigated defense was wholly disallowed, it did not for the moment occur to us to look further than to the prayer of the original bill and the date of its filing as to the amount of the balance involved, and we directed that a decree be entered here for the amount sued for; and the amount was entered by the clerk from the data as above stated. The motion now made by appellant calls attention to the fact that there was a misrecital in the prayer of the original bill as respects the actual amount of the balance due on the date aforesaid and to the correction of that recital which was made in complainant's answer to the cross-bill, and calls attention further to the exhibited notes and the only credit against them, all of which when considered, with the proper calculations thereon, shows that the true amount of the balance due appellant as of December 4, 1934, was $12,570.14. The true amount due, as shown by the controlling portions of the record, was the amount for which we intended the decree to be entered, plus the stated interest; and under the authority of Section 755, Code 1930, we now direct the decree to be corrected to carry the amount last above stated with six per cent interest from December 4, 1934.
Appellee has resisted the motion by urging that appellant should be precluded from presenting the motion at this time, because through all the five or six months following the delivery of the original opinion there have been at the request of the Court, or by its allowance, two or three briefs on the part of appellant in reply to appellee's suggestion of error, and not once was any mention made of the mistake in the amount of the decree. We have already referred to the fact that appellant in its answer to the cross-bill prayed decree for the corrected amount, so that appellee was in nowise misled as to the actual balance placed in issue; and had we looked to that later pleading and checked it with the exhibited notes, we would ourselves have seen the correct amount as hereinabove stated, and would originally have entered the decree as it is now hereby ordered. Our attention was then focused upon the litigated points, as was that of everybody else concerned with the case, and it is, therefore, but justice to the actual record to do what we are now ordering.
Motion to correct decree sustained.