Opinion
No. 27865.
June 20, 1950.
APPEAL FROM THE CIRCUIT COURT, FRANKLIN COUNTY, RANSOM A. BREUER, J.
Leo A. Politte, Washington, for appellant.
Frank W. Jenny, Union, for respondent.
In this action plaintiff, Max F. Ruler, seeks to recover the price paid by him to defendant, the M. M. Motor Company, for a secondhand automobile on the ground that his purchase of said car was induced by fraudulent representations of the officers and employees of defendant. The case was tried to the court and resulted in a finding and judgment for plaintiff in the sum of $450. From the judgment, defendant has appealed.
The misrepresentations relied upon by plaintiff in his petition were: "that defendant, by its agents, officers and employees, wilfully and fraudulently represented said automobile to be in good operating condition, mechanically sound, and in good running order for the use of plaintiff in the business in which plaintiff was engaged." The defendant's answer put in issue all the material allegations of the plaintiff's plea of fraud.
Plaintiff resides in Sullivan, Missouri, where he is engaged in the practice of the law. Defendant is a corporation engaged in selling automobiles at Washington, Missouri. Mr. O. R. McMonigle is the President of defendant corporation, and Eugene Lock was, at the time of the purchase of the automobile by plaintiff, Manager for defendant. Throughout the testimony, Mr. Lock is referred to by the nickname of "Chick."
On November 22, 1948, Mrs. Ruler, at the direction of her husband, went to defendant's place of business in search of a used car that Mr. Ruler might buy. There she met Mr. McMonigle who showed her a 1935 Chevrolet automobile which she did not like. During the course of the conversation between Mrs. Ruler and Mr. McMonigle the latter mentioned that he had a Ford Coupe being worked on in defendant's garage but that it was not at the time ready to be shown. Mrs. Ruler then asked if she might see it. McMonigle assented to this request, stating that the price of the Ford would be $450 when it was finished. Mrs. Ruler testified: "* * * and we went in and they had some rubber hose or something on the inside, the engine was open, and I asked him what they were doing to it, what was wrong with the motor, and he said `nothing', that the motor was in good condition, that it was just being tuned up * * * and he said, `It will be a good paint job, and the upholstering will be mended, and new slip covers put on. And the tires on here, we will have to change those, * * * and fix the car up in good running shape.' I says, `all right, my husband is in the doctor's office, and we will be back again next week, and I will bring him down to see whether this is the type of car he would like.'"
Mr. McMonigle testified that the first time Mrs. Ruler came to defendant's place of business was on November 22nd; that he was not there when she came back on November 29th, but that Eugene Lock (Chick) was in charge of the garage and sales at the time; that he (McMonigle) was not present when the transaction was closed and the down payment made; that he told Mrs. Ruler on her first visit that he did not intend to do any work on the motor; that she asked if the motor was "O.K." and that he replied: "I don't know. It sounds good"; that he believed Mrs. Ruler asked him what kind of brakes were on the car and that he mentioned the fact it had mechanical brakes; that she said they wanted good brakes, and he stated: "Well, you understand, these are mechanical brakes, and you will have to get into a later model car to get hydraulic brakes."
On November 29th Mr. and Mrs. Ruler returned to defendant's place of business. Mr. McMonigle was not there at the time. However, Mr. Lock, the service manager was there, met them, and showed the car in question to Mr. Ruler. Mrs. Ruler testified: "and he (Lock) came back and showed the car, and it was all finished but repainting, and I don't think they had the slip covers on yet. So, I said — well, they hadn't those rear windows in yet either, and Mr. Ruler says: `Well, I am not interested in these minor things, all I am interested in is a car that has a good motor and good brakes.'"
Mrs. Ruler testified that, after further conversation, Mr. Ruler directed her to give Lock a check for $50 as a down payment, but she insisted that she would rather not make a down payment without a demonstration. Lock agreed to this and had a mechanic drive the car in front of the building. Lock then drove the car with Mrs. Ruler as a passenger for two or three blocks, then announced that the car was about out of gas and returned to the garage. During this demonstration Mrs. Ruler, according to her testimony, told Lock: "Chick, you know that my husband is not a young man, and we know nothing about a car, and all I am asking you is to give us a fair deal, and don't try to put something over on me." She stated that Lock replied: "O.K., these brakes need tightening, and I will have them tightened for you." After the demonstration Mrs. Ruler gave Lock a check for $50 as a down payment and directed him to bring the car to Sullivan when it was finished.
Mr. Ruler testified that on November 29, 1948, he went to defendant's place of business and was shown the car in question.
He further testified: "When I saw it they had a hose connection in one of the cylinders. And then Mrs. Ruler spoke about the upholstering, etc., and I interrupted, and I said: `I am not interested in the upholstering, or any of these minor details, that any used car will have to be accepted as is, and those are only minor details. What I want to know, is the car — are the brakes good, and is the engine in good condition, and is it safe for me to drive?' Chick said the car wasn't yet ready but in about a week it would be. And then I said to Mrs. Ruler, `Give him a check on account for $50.' We went over to the office and Chick, was present, and I said to Chick, `Now, I don't know anything about automobiles, I am not a mechanic, I have no time to take demonstrations or look around for particular cars, I will take your word for what this car will do. I will pay your price, ask no discount, pay your price in cash.' * * * I said, `At the time of delivery, what condition will it be in?' He says, `It will be in A-1 condition.' I says, `Will it be safe for me to drive?' He says, `O.K., it will.' I says, `I will rely on your representation.' I says, `Mrs. Ruler, give him a check.'"
Eugene Lock's testimony as to what transpired on November 29, 1948, is as follows: "On November 29, Mr. and Mrs. Ruler came into the shop and asked for Mac, and I says he was out of town in St. Louis. And she told me about the week before, she had looked at a '38-Ford. And she asked me if she could see it, and I says `yes.' So I showed her the car, and Mr. Ruler looked at it a little bit, opened the doors, and says, `Well, you do what you want to do. If you want to buy it, you buy it, because I have got a doctor's appointment.' So he left and Mrs. Ruler and I had it from there. She asked certain things about the car, that is, about windows. I told her we would put them in, that Mac had said that. And she asked about the engine. I says, `We are not going to do anything at all to the motor.' * * * I told them that it was in fair condition."
Mr. Lock further testified that he did not tell Mr. and Mrs. Ruler that he was going to put the engine in perfect condition.
In rebuttal, Mrs. Ruler denied that on her first visit to defendant's place of business McMonigle stated that he did not intend to do any work on the motor. She stated that McMonigle at that time said that the motor was in good condition and that he was tuning it up. She also denied that McMonigle told her the kind of brakes that were on the car.
Mr. McMonigle delivered the car to plaintiff at Sullivan, Missouri, on December 4, 1948. Plaintiff testified that when McMonigle arrived in Sullivan with the car, Mrs. Ruler introduced plaintiff to McMonigle and the latter said: "Here is your car." Plaintiff testified: "I says, `Are the brakes good? Is the engine good? And, is it in a safe condition, as you said?' He says, `Yes, it is your car.' I says, `Come in,' and I gave him a check for $400, the balance of the purchase price."
McMonigle testified that when he arrived at Sullivan on December 4th he was met by Mrs. Ruler. He further testified: "And I got out, and she said, `Well, I will go in and get Mr. Ruler and let him look at it.' And he came out and looked the car all over, got in it, closed the door, and sat there and kind of felt it out, and said: `Well, I believe this will be all right.' And then he got out and closed the door and says, `Come in the office, and I will give you a check.' And that is all of the conversation that took place outside of the building. * * * no warranty of any kind was either given or implied in any instance when I talked with Mr. or Mrs. Ruler. And she was specifically told that no work had been done on the motor, and the only work that was going to be done was on the body and the seat, merely clean up work.
"Q. Was there ever any warranty made by you, or authorized by you to be made, on this car, as far as the brakes were concerned?
* * * * * *
"A. No, sir."
At the time the car was delivered Mr. McMonigle gave plaintiff the certificate of title to the car. The certificate of title was made out to Mr. Ruler.
At the time of the purchase of the car, plaintiff signed an order which contained the following agreement:
"The front and back of this order comprise the entire agreement pertaining to this purchase and no other agreement of any kind, verbal understanding or promise whatsoever will be recognized.
* * * * * *
"This automobile is sold under the standard warranty described below and it is the only warranty, either expressed or implied, made under this order, and carries no guarantee as to the date of manufacture. In the event that this order covers the purchase of a used car, the seller does not guarantee the mileage and the car is sold `as is'."
About one-half hour after the car was delivered, plaintiff attempted to start the motor but was unable to do so. According to plaintiff's testimony, the battery was dead and was in such condition that it could not be repaired. Neither the foot brake nor the emergency brake would work. At the time the car was delivered there was no horn, speedometer connection, and no gasoline float to indicate the amount of gasoline in the gasoline tank. The ignition key was broken off in the ignition lock, and had to be drilled out. The next day after the car was delivered plaintiff discovered that the left front door was jammed, so that one driving the car could not get out that door. On the second day after the delivery of the car the radiator sprung a leak and had to be soldered. There also developed an oil leak in one of the cylinders. Plaintiff also testified that the transmission was in such condition that it made a grinding noise, and that one of the wheels would lock.
Plaintiff further testified that on December 15, 1948, he went to defendant's place of business and made complaint to Mr. Lock and told him of the condition of the car. He stated that Lock put a horn on the automobile, threw a spare tire in the back of the car, and said he had talked to McMonigle who said there wasn't anything more to be done about it. Plaintiff further testified: "Then I left there. * * * I started the motor, got it into first, and got it into second, and I got it into high and it wouldn't work. I got it part of the way out of the curb, and then I put it back into low, and I put plenty of gas on it, and then it chugged, chugged, chugged, and the wheels stopped, and the other wheel turned and I made about 100 feet and the engine began to smoke, you could smell it. I finally got it into second and made the hill. And then I got it into high, and after going about forty miles an hour all the noise disappeared. But all of the times I tried to drive it acted that way until I got to forty miles an hour, and that is too fast for me. In other words, that sound was always present until I got to a speed of forty miles an hour on the highway. * * * During this time between December 4th and January 3rd, I drove it several times, but I never drove it down that incline (at plaintiff's house), which was closer to town, because I was afraid of the brakes. I put my foot clear to the floor and the brakes wouldn't work. And I went down that other way. And I left the car in the garage for over a week, and used a taxicab during that time. * * * I drove over one time back to Union with it, and when I got down that incline, from the gravel road, the short cut from St. Clair * * * I put on the brakes, and I put it in second, and I put it in low, put on the emergency, and had my foot on the brake, and as I came toward the paved highway it wouldn't stop. I had to turn to the left to avoid some other car. When I started up the hill it had no traction, the same thing would happen, the engine would smoke and make a peculiar noise, and until I got to forty it wouldn't run at all."
Plaintiff testified that the first complaint to defendant about the condition of the car was made by Mrs. Ruler at his direction on December 7, 1948. At that time Mrs. Ruler talked to Mr. Lock who said he could not do anything about it, but would talk to McMonigle about it. Later, Lock told her that McMonigle said that as far as he was concerned he had sold the car and didn't intend to have anything more to do with it. Mrs. Ruler corroborated the testimony of plaintiff concerning the improper working of the automobile.
Oren Paul, an automobile mechanic, testifying for plaintiff, gave it as his opinion that the engine had a broken piston ring at the time he examined it on December 11th.
After the purchase of the car, plaintiff's son loaned his own car to plaintiff. The son objected to the mechanical brakes on his father's car.
Lock testified that the first time Mrs. Ruler came back to the garage she said the motor was in good condition and hoped that it would stay that way. He further testified that he adjusted the brakes and that they worked fine. He also testified that he started the automobile in question numerous times and that it was not difficult to start, the doors never jammed, the transmission never locked, and that he did not notice any mechanical defects that were not ordinarily found in a car ten years old.
It further appears that on December 30, 1948, plaintiff offered the car for sale in an advertisement in the "Sullivan News," a newspaper in Sullivan, Missouri.
Mrs. Helen McMonigle, an officer of defendant corporation, drove a truck and followed Mr. McMonigle when he drove the Ford car to plaintiff's office on December 4th. She testified that her husband had no trouble starting the Ford on that occasion, and had no trouble with it while going to Sullivan.
According to the testimony of both Lock and McMonigle, the car did not have any of the defects claimed by plaintiff, but was in good condition at the time it was delivered to plaintiff on December 4, 1948.
On January 3, 1949, Mrs. Ruler and her son, at the direction of plaintiff, took the car to defendant's place of business and left, demanding a return of the purchase price. The certificate of title to the car was left at defendant's place of business by plaintiff's attorney.
Emil Wilmescher, Sr., testified that he was working in the defendant's garage when Mrs. Ruler and her son came to the garage to return the car. He testified: "They wanted Mac to take the car back because they had another car and they didn't need it; her son gave them a car to use, and that another thing this car had mechanical brakes and he didn't want his father to drive a car with mechanical brakes on it."
Appellant contends that the terms of the order signed by plaintiff preclude recovery in this action, and in support of this contention points to the clause in said order which provides that said order contains the entire agreement between the parties, and that "the car is sold `as is.'"
There is no merit to appellant's contention. The question is not whether a written contract may be varied or contradicted by an antecedent or co-existing express oral warranty. The parol evidence rule prohibits that. This is not that kind of an action, but an action in fraud, and in such an action the parol evidence rule does not prevent one from showing that the sale evidenced by the contract was induced by fraud. Tiffany v. Times Square Automobile Co., 168 Mo.App. 729, 154 S.W. 865; Edward Thompson Co. v. Schroeder, 131 Minn. 125, 154 N.W. 792. See also, Annotation, 10 A.L.R., page 1472; Hooker v. Wilson, 69 Okl. 43, 169 P. 1097; Dusbabek v. Bowers, 173 Okl. 53, 43 P.2d 97, 47 P.2d 141; 27 C.J. p. 52, 37 C.J.S., Fraud, § 105; Mooney v. Cyriacks, 185 Cal. 70, 195 P. 922.
The basis of the exception is that the parol evidence rule should not be invoked as a shield for fraud, or be applied to work injustice. In Tiffany v. Times Square Automobile Co., supra, the court points out that one should not be permitted to make a binding contract so that his fraud shall not be shown, any more than he should be permitted to stipulate that his crime should be closed from view by the terms of a written instrument.
It is urged by appellant that there was not a complete rescission because the certificate of title was not reassigned and delivered to defendant. The petition alleged that the assignment of the title was marked "canceled" and the title delivered to defendant. By its answer, defendant admitted the delivery of the title to it. It is true that to effectuate a sale of a motor vehicle a certificate of title must be assigned by the owner. Here, however, plaintiff was not making a sale of the car to defendant when he redelivered it. He was attempting to rescind a sale previously made to him. We do not believe that he was required to go through the formalities of a re-sale before being entitled to recover on the theory of a rescission for fraud.
It is further urged that plaintiff is not entitled to rescind the sale because he failed to tender back the automobile within a reasonable time. The evidence shows that the sale was made and the car delivered to plaintiff on December 4, 1948, and returned to defendant on January 3, 1949. Plaintiff's first complaint was made to defendant within three days after he received the car, and thereafter complaint was made to defendant on December 15th. Plaintiff testified that he continued in his attempt to make the car run because he thought it's failure to operate properly might be due to the way he handled it, but that finally he became convinced that it was the fault of the car. After that, the car was delivered to defendant. In view of this evidence, we do not believe that plaintiff can be said to have failed to rescind within a reasonable time.
Nor is there any merit to the contention that plaintiff failed by his evidence to establish defendant's fraud. To establish the kind of fraud relied on in this case it must be shown that a material false representation was made; that the speaker knew of its falsity or made it recklessly as a positive assertion without knowledge of its truth; that the speaker intended that the person addressed should act thereon; and that the person so addressed did act thereon to his damage.
The plaintiff's evidence, which we believe to be true, together with the reasonable inferences to be drawn therefrom, in our opinion satisfies all of the foregoing requirements. We believe the trial court properly decided this case. The judgment is affirmed.
HUGHES and McCULLEN, JJ., concur.