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Collins v. Abel Holding Co.

Court of Appeals of Georgia
Nov 14, 1953
79 S.E.2d 436 (Ga. Ct. App. 1953)




Action on promissory note; breach of contract. Before Judge Fort. Muscogee Superior Court. June 4, 1953.

Cozart, Rosenstrauch Nilan, for plaintiff in error.

Paul Blanchard, Arthur F. Copland, contra.

Prior and contemporaneous statements and agreements, which are not incorporated therein, cannot be shown to vary, contradict, and change the terms of a valid written contract purporting on its face to contain all of the terms of the sale of certain personal property by the plaintiff to the defendant.


Abel Holding Company, a corporation (hereinafter called the plaintiff), brought suit in the Superior Court of Muscogee County, against C. R. Collins (hereinafter called the defendant), alleging that, on March 5, 1952, the defendant executed in its favor a promissory note for $4,500 principal, payable June 1, 1952. This sum represented a part of the purchase price of three named horses bought from the plaintiff corporation by the defendant. In order to secure the payment of the note, upon which suit was brought, the defendant on the same day executed a contract wherein title to the horses remained in the corporation until such note had been fully paid. These horses were a gelding named "Thunderhead," a stallion named "Smokey," and a mare named "Flicka." Said contract provided, "No warranties have been made in reference to the property by the seller to the purchaser unless expressly stated herein," and "This agreement and the promissory note constitute the entire agreement between the parties, and shall bind the purchaser and his legal representatives and shall inure to the benefit of the successors and assigns of the seller." This contract was signed by the defendant and by Abel Holding Company (commonly known as Steel Pier), by Norman L. Marshall.

The defendant filed his plea and answer, wherein he admitted the execution of the note but denied liability thereon to the plaintiff, and averred that the contract and note were "executed by him as a result of fraudulent representations and deceitful means of the plaintiff's agents." The defendant further alleged that he was induced to execute the note and contract "by false representations, deceitful means, and artifice on the part of the agents, employees, and servants of petitioner, which said representations were known by said agents and employees to be false and were made for the purpose of deceiving the defendant and causing him to rely thereon and that the same were actually relied upon and did deceive the defendant to his injury and damage." The defendant further set out that an agent of the plaintiff, George A. Hamid, Sr., made false representations to the defendant; that he represented to the defendant that the plaintiff owned said horses; that they were the identical horses which starred in three popular motion pictures produced by Twentieth Century Fox Corporation; that the horses were young, not being over ten years old; that the films in which these horses had starred could be leased by the defendant from said film corporation; that the plaintiff possessed a large amount of definite advertising and publicity material relating to the horses and the pictures in which they starred, which was available and would be delivered to the defendant if he purchased these horses from the plaintiff. The defendant further set out that Hamid knew the defendant desired to use these horses solely for public exhibits, and that they would be of no value for this purpose without said films and material, and unless the horses were of such age as to render it possible for them to be conditioned to be exhibited by the defendant. The defendant further alleged that, when he signed the note and contract, he demanded from Norman L. Marshall, who signed the note and contract "Abel Holding Co. (commonly known as Steel Pier) by Norman L. Marshall." on behalf of the plaintiff, delivery of the advertising and publicity material, but was told by Marshall that it could not be transported in the defendant's truck because of the size and would be promptly shipped to him in Columbus, Georgia.

The defendant further set out that the representations made by Hamid and Marshall were made for and on behalf of the plaintiff to induce the defendant to execute said note and contract, and that he relied thereon in signing these instruments. The defendant further averred that, after delivery of the horses, he discovered that they were older than had been represented; that they could not be conditioned for exhibition purposes because of their age; that the motion pictures produced by the Fox Corporation were not available for lease by the defendant, although he endeavored to lease same; that, as a result of the advanced age of these horses and without the films and advertising material, said horses were wholly unfit for the purpose for which they were sold to the defendant and were worthless to him. The defendant alleged that the horses were of no value except for being manufactured into dog food, which value was trivial, and, therefore, there was a failure of consideration. The defendant further set forth that, immediately after he discovered that the aforesaid representations by Hamid were false, and upon the plaintiff's failure to deliver said advertising material, he notified the plaintiff of such discovery and of his intention to return the horses and rescind the contract, and he did offer to return the horses and repeatedly sought to have the plaintiff accept them back and rescind the contract, and the defendant has always been and is now ready to deliver the horses back to the plaintiff and to rescind the contract. The defendant further alleged by way of cross-action that, because of the fraud which the plaintiff's agents had perpetrated upon him, he suffered large expenses for the transportation, food, care and protection of said horses, amounting to $2,550, and he says that he is entitled to a rescission of the contract and to be refunded the sum of $1,500, paid by him on account of the purchase of these horses. The defendant sought to recover of the plaintiff as damages these items.

Thereafter, on May 5, 1953, the plaintiff interposed both general and special demurrers to the answer and cross-action, setting out that the answer set forth no defense, either in law or in equity, to the petition, and that the answer by way of cross-action set out no cross-action, either at law or in equity, against the plaintiff. The plaintiff demurred specially to various paragraphs on the ground that the allegations demurred to constitute an attempt on the part of the defendant to vary and contradict the terms of an unambiguous written contract, and also because the allegations made were simply promises or statements that certain things would or could be done after the execution of the contract and could not properly form the basis for or a cause for rescinding the contract. The plaintiff also demurred to portions of the defendant's plea and answer for the reason that there is no warranty in the contract sued on that the horses would be suitable for public exhibition, said contract expressly providing that no warranty had been made in reference to the property sold.

On May 26, 1953, the defendant sought to amend his plea and cross-action by adding thereto a paragraph known as "paragraph 18," in which the defendant set out that he had no special knowledge concerning the age of horses and whether or not they could be conditioned for exhibition purposes. The defendant set out that Hamid knew the age of these horses and possessed such knowledge as enabled him to determine their age, and he knew whether or not such motion-picture films were available to the defendant for leasing and whether or not the publicity material was available for delivery to the defendant. The defendant averred that he had no knowledge and none was immediately available to him whether said pictures could be leased or publicity material shipped to him, and he averred that he had exercised due diligence under the circumstances.

Thereupon the plaintiff renewed its general demurrer to the answer as amended, and the court rendered a judgment sustaining the general demurrer to the answer and cross-action and to the amendment thereto, ordering same to be stricken; and also on the same date rendered a judgment sustaining the special demurrers to various portions of the plea and answer and ordered that those portions be stricken. To these orders and judgments the defendant excepted pendente lite, and assigned error thereon in the bill of exceptions. Thereafter, on June 4, 1953, a verdict and judgment was rendered for the plaintiff, awarding the principal, interest, and attorney's fees for which suit was brought. To this judgment the defendant excepts by writ of error.

The defendant urges that the note and contract sued upon herein were procured by fraudulent and deceitful acts and means, that is, that he was induced to sign such written instruments by reason of the false representations of the plaintiff's agents relative to the horses purchased by him from the plaintiff corporation. "Fraud renders contracts voidable at the election of the injured party." Code § 20-502. "Wilful misrepresentation of a material fact, made to induce another to act, and upon which he does act to his injury, will give a right of action." § 105-302. "Fraud may exist from misrepresentation by either party, made with design to deceive, or which does actually deceive the other party; and in the latter case such misrepresentation renders the sale voidable at the election of the injured party, though the party making it was not aware that his statement was false. Such misrepresentation may be perpetrated by acts as well as words, and by any artifices designed to mislead. A misrepresentation not acted on is not ground for annulling a contract." Code § 96-202. "Fraud or duress, by which the consent of a party has been obtained to a contract of sale, renders the sale voidable at the election of the injured party." § 96-201. The defendant states that the plaintiff, through its said agents, made fraudulent representations to him when he entered into this contract and signed said note for the remainder of the purchase price of the horses.

The note and contract constituted the entire agreement. The representations and statements, which the defendant says induced him to buy these horses and to enter into the contract, were all oral. Nothing was said in these written instruments as to the age of the horses or as to the use for which the defendant desired to acquire them, or as to there being certain advertising matter to be turned over to him along with the delivery of the horses for use in exhibiting these horses. These matters were all parol representations and agreements, tending to take from, add to, or vary the terms of a written contract, and not entirely consistent with its terms.

In Smith Bros. v. Webb Maury, 20 Ga. App. 313 ( 93 S.E. 74), this court said: "When the parties have reduced to writing what appears to be a complete and certain agreement, importing a legal obligation, it will, in the absence of fraud, accident, or mistake, be conclusively presumed that the writing contains the whole of the agreement between them; and if it contains an express warranty of certain qualities in the article sold, an implied warranty of other qualities is excluded." In Bullard v. Brewer, 118 Ga. 918 ( 45 S.E. 711), the Supreme Court said: "Parol evidence of prior or contemporaneous representations or statements is inadmissible to add to, take from, or vary the written instrument." Also, in the same case it was said: "If, therefore, such a writing exists between the parties, and it contains no warranty at all, no warranty can be added by parol; if it contains a warranty of some kind or to some extent, parol evidence will not be admitted to extend, enlarge or modify that which the writing specifies." It is quite evident that the note, representing the balance of the purchase money for the horses bought by the defendant from the plaintiff, and the conditional-sale agreement between the parties providing that title to the horses was to remain in the seller until the note was paid in full, constituted a complete, unconditional and unambiguous contract. There is nothing to indicate that it did not contain all the terms of the agreement made between the parties. The contract stated the amount of the balance of principal due, the rate of interest, and when and where same should be paid. It set out the consideration, and provided that the title to the horses should remain in the seller until the note was fully paid, that the buyer was to keep the horses insured, that the buyer was to take the risk of the horses dying, that homestead was waived, that the seller should have the right to take possession of the horses if the debt was not paid; and it also expressly provided that the note and contract constituted the entire agreement between the parties, and that there were no warranties made "in reference to the property by the seller to the purchaser unless expressly stated herein." The defendant is bound by these recitations in the contract. Widincamp v. Patterson, 33 Ga. App. 483 ( 127 S.E. 158).

The note and contract sued on purported to show upon their face the terms of the contract for the sale of the horses, and it was not permissible for the defendant buyer to plead or prove a breach of a contemporaneous agreement or express warranty not in writing. West v. Miller, 32 Ga. App. 199 (2) ( 122 S.E. 809).

In the present case, the contract recites that no warranty was made, save as expressed therein, and none was expressed therein, and said instrument further recites that the note and contract of sale contain all of the terms of the agreement between the parties. Where the written contract between the parties excluded any warranty of health or soundness of the mule sold, parol testimony could not be admitted to vary the terms thereof. See Jones v. George S. Riley, Jr., Co., 14 Ga. App. 84 ( 80 S.E. 341). In United Motor Atlanta Co. v. Paxson Bros., 14 Ga. App. 172 ( 80 S.E. 704), it was held: "If it appears that the automobile, for the purchase price of which suit was brought, was sold to the defendants under a contract containing a limited warranty, they cannot insist upon any warranty other than that embraced in the contract. . . Moreover, if the defendants rely upon an express warranty, they cannot defend upon proof of an implied warranty." The plea of the defendant in the present case was not good in law and was subject to the demurrers urged thereto. Borders v. Chapman, 22 Ga. App. 712 ( 97 S.E. 96).

Conceding that an implied warranty existed in this transaction that the property purchased by the defendant from the plaintiff, to wit, three named horses, was reasonably suited to the intended use, there was no implied warranty that these horses would answer some particular or special purpose of the defendant buyer. The defendant sets up that these horses were intended to be used by him for show or exhibition purposes, and that this was known to the plaintiff's agents. The written contract contains no statement or indication that such was the use intended by the defendant when he bought the horses. The defendant alleges that there was a parol understanding that this was the reason for his buying the horses, and that, if they were not suitable for such purpose, they were worthless to him. There was no warranty, express or implied, on the plaintiff's part that these horses were suitable for the particular purpose intended by the defendant buyer. The warranty implied by law that the article sold is reasonably suited to the uses intended by the buyer (Code § 96-301) refers not to any particular intended use by the buyer, even if such intended use is made known to the seller, but to the use for which the article sold is commonly intended. Love v. Nixon, 82 Ga. App. 445 ( 61 S.E.2d 423). It matters not that this intended use is made known to the seller. Kontos v. Jordan, 57 Ga. App. 267, 273 ( 195 S.E. 210). There is no implied warranty that articles used for a particular purpose will answer some other purpose intended by the buyer. Colt Co. v. Bridges, 162 Ga. 154 ( 132 S.E. 889). Where the buyer expressly agrees in a written contract of sale that no agreement or warranty other than that specified in the contract shall be binding upon the seller, such an agreement expressly precludes the buyer from setting up the implied warranty which the law would otherwise read into the contract. Stimpson Computing Scale Co. v. Taylor, 4 Ga. App. 567 ( 61 S.E. 1131).

It does not appear that there was any fraud in the procurement of this contract such as would in the contemplation of the law entitle the buyer to rescind the contract, or entitle the buyer to damages from the seller for its alleged failure to deliver horses particularly suited for exhibition purposes, and to turn over to the defendant the advertising matter which it is alleged the plaintiff orally stated it would do. See Outlaw v. Park Live Stock Co., 20 Ga. App. 776 ( 93 S.E. 310). The statement by the agent of the plaintiff that the defendant could procure a lease of the moving pictures from a film company, owning same which the defendant was not able to do, does not constitute fraud voiding the contract and the note sued on. The fact as to the age of the horses was an oral statement, and with exercise of slight diligence the defendant could have ascertained their age before signing the note and contract.

It follows that, applying the foregoing principles of law, the plea and answer of the defendant as amended failed to set up any defense to this action on the note and contract, and was subject to the demurrers, general and special, urged thereto and sustained by the court. No case showing the defendant entitled to recover damages on account of any alleged fraud of the plaintiff was made.

There being no proper defensive pleadings to the plaintiff's action on the note and contract for the balance of the purchase price of these horses, it was not error for the court, under the facts, to direct a verdict for the plaintiff on such note and contract and to enter judgment accordingly.

Judgment affirmed. Townsend and Carlisle, JJ., concur.

Summaries of

Collins v. Abel Holding Co.

Court of Appeals of Georgia
Nov 14, 1953
79 S.E.2d 436 (Ga. Ct. App. 1953)
Case details for

Collins v. Abel Holding Co.

Case Details


Court:Court of Appeals of Georgia

Date published: Nov 14, 1953


79 S.E.2d 436 (Ga. Ct. App. 1953)
79 S.E.2d 436

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