Galloway v. Holmes

1 Doug. 330
CourtMichigan Supreme Court
DecidedJanuary 15, 1844
StatusPublished
Cited by24 cases

This text of 1 Doug. 330 (Galloway v. Holmes) is published on Counsel Stack Legal Research, covering Michigan Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Galloway v. Holmes, 1 Doug. 330 (Mich. 1844).

Opinion

Ransom, C. J.

delivered the opinion of the Court.

The sole question presented by this case is, whether the action was properly brought, it having been commenced before the credit of six months on which the goods were sold to the defendant, had expired. The plaintiffs contend that, the goods having been obtained from them by the fraudulent representations of the defendant or his agent, the contract of sale on six months credit was utterly void, and the draft given by the defendant in payment a nullity; that they had a right to treat it as mere [336]*336waste paper, and bring their action for the price of the goods as though it had never been delivered to them, and as though no express contract touching the sale and purchase of the goods had been shown.

The question involved is one of much practical importance, and has been argued with great zeal and ability by the counsel for both parties. It is one upon which jurists of great learning and experience have differed in opinion; and, anxious in establishing a rule here, to fix upon that one which seemed most strongly fortified by adjudged cases of approved authority, and most in accordance with settled principles, we have given it the most thorough and deliberate consideration which the time at our disposal would allow.

That the original contract between the parties was utterly null and void, by reason of the fraud of the defendant, is not, I think, true, to the broad and unqualified extent contended for by the plaintiffs. I understand a contract to be void, in a strictly legal sense, only when it can be enforced by none of the parties to it; as, for example, one founded upon a gaming or other illegal consideration. This was a valid and subsisting contract as against the defendant, which the plaintiffs could have enforced, according to its terms and effect, had they elected to do so. It could only be disaffirmed by the plaintiffs, who were the defrauded party. Until they have disaffirmed it, it cannot be said that there was no contract, or that the contract was void, however fraudulent it might have been on the part of the defendant. It was merely voidable at the option of the plaintiffs. I am aware that many of the cases, and of the elementary books, frequently apply the term void to the class of contracts to which the one under consideration belongs, but they oflener, perhaps, and certainly with more propriety, employ language which indicates their true character ; as, that a party lured into a [337]*337contract by the fraud of another, may disregard, may dis-affirm, may treat as void the contract, &c. In Chitty’s classification of such contracts, he denominates them “contracts voidable on the ground of fraud.” Chitty on Contr. 678.

If there was an express contract, none can be implied. It is a well settled principle, that promises in law, exist only in the absence of express promises. Whiting v. Sullivan, 7 Mass. R. 107 ; Chitty on Contr. 25. In Touissant v. Martinnant, 2 T. R. 104, where a surety had taken a bond from his principal, and the principal having failed, he had paid the debt, and then brought assumpsit for the money paid, Butter, J. held this language: “Why does the law raise such a promise? Because there is no security given by the party. But if the party choose to take a security, there is no occasion for the law to raise a promise. Promises in law only exist where there is no express stipulation be'tween’the parties.” Again, in Cutter v. Powell, 6 T. R. 320, Lord Kenyon said, that “the rule, that where the parties have come to an express contract none can be implied, has prevailed so long as to be reduced to an axiom in the law.” And Justice Ashurst, in the same case said, — “ It has been argued that the plaintiff may recover on a quantum meruit; but she has no right to desert the agreement} for wherever there is an express contract, the parties must be guided by it; and one party cannot relinquish or abide by it as may suit his advantage.”

If, then, as has been shown, the contract for the sale and purchase of the goods was merely voidable at the election of the plaintiffs, and not absolutely void ah initio, on account of the fraud of the defendant, this action cannot be sustained; because, there having existed an express contract, the law will not imply one.

The counsel for the plaintiffs admit, that if there was a [338]*338valid contract subsisting between the parties when the action was commenced, it must govern, and the action be founded upon it.

There was such a valid and subsisting contract, unless it was disaffirmed by the plaintiffs, on account of the fraud. Do they not affirm it by suing in this form of action ? They answer negatively, and say they reject the contract altogether, and content themselves with showing the goods unaccounted for in the hands of the defendant; insisting that from this evidence the law raises an implied promise to pay for them. This is met by the defendant with proof of an express agreement, by the terms of which his liability to pay for the goods had not accrued when the suit was commenced. To this it is replied that the express agreement was fraudulent on the part of the defendant, and that he cannot set it up as a defence to the just claim of the plaintiffs. But it must be remembered that the defendant does not admit the agreement to be fraudulent. He insists that it is a valid contract, and binding upon both parties. The plaintiffs alledge the fraud, and rely upon it in avoidance of the contract actually made. That they might have disregarded the agreement and sued immediately on discovering the fraud, is undeniable, but I think it is equally clear, that they should have brought their action for the injury occasioned by such fraud. If the purchase on the part of the defendant was fraudulent, he acquired no title to the goods by the purchase, and the plaintiffs might undoubtedly have brought trover for their conversion, or replevin for their return ; but by bringing assumpsit they waived the wrong; they alledged a sale and based their right to recover on the sale alone. It was competent for them to do so; but they thereby placed themselves in the exact position they would have occupied had no fraud existed; — that is, they might have recovered upon an implied promise had not an express pro[339]*339mise been shown. Such an one, however, being proved, they were confined to, and bound by it.

Where the defrauded party rescinds an express contract entered into by him, he cannot set up an implied one, and-sue the other party thereon. Chitty on Contr. 680, ’1. A contrary doctrine, it seems to me, would be a violation of settled principles upon the subject of contracts and remedies. I will review some of the leading cases bearing upon this question.

The first case referred to bjr the plaintiffs’ counsel was the Manufacturers' and Mechanics' Bank v. Gore & Grafton, 15 Mass. R. 75. Grafton applied to the bank to know if a note, drawn by the defendants, who were partners, and endorsed by two other individuals whom he named, would be discounted, and being informed that it would, drew the note, signed it for the firm, and, without the knowledge or consent of the payees, placed their names as endorsers upon the back of it. This note, with two similar ones, all on time, was discounted by the bank, and the proceeds passed to the credit of the defendants.

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Walton School of Commerce v. Stroud
226 N.W. 883 (Michigan Supreme Court, 1929)
Siders v. Siders
48 N.E. 277 (Massachusetts Supreme Judicial Court, 1897)
Wilson v. Beckwith
41 S.W. 985 (Supreme Court of Missouri, 1897)
Emerson v. Detroit Steel & Spring Co.
58 N.W. 659 (Michigan Supreme Court, 1894)
Hough v. Comstock
55 N.W. 1011 (Michigan Supreme Court, 1893)
Wylie v. Gamble
55 N.W. 377 (Michigan Supreme Court, 1893)
Cressey v. Wallace
29 A. 842 (Supreme Court of New Hampshire, 1891)
Doten v. Doten
29 A. 542 (Supreme Court of New Hampshire, 1890)
Wallace v. Minor
10 S.E. 423 (Supreme Court of Virginia, 1889)
Pangborn v. Continental Insurance
35 N.W. 814 (Michigan Supreme Court, 1888)
Merrill v. Wilson
33 N.W. 716 (Michigan Supreme Court, 1887)
Searles v. Reed
29 N.W. 884 (Michigan Supreme Court, 1886)
Sayre v. Thompson
18 Neb. 33 (Nebraska Supreme Court, 1885)
Stevens v. Underhill
36 A. 370 (Supreme Court of New Hampshire, 1883)
Simmons v. Kelly
39 N.J.L. 438 (Supreme Court of New Jersey, 1877)
Linn v. Smith
15 F. Cas. 563 (U.S. Circuit Court for the District of Eastern Michigan, 1870)
Lisbon v. Lyman
49 N.H. 553 (Supreme Court of New Hampshire, 1870)
Norris v. Hensley
27 Cal. 439 (California Supreme Court, 1865)
Hart v. Burnett
15 Cal. 530 (California Supreme Court, 1860)
Judy v. Williams
2 Ind. 449 (Indiana Supreme Court, 1851)

Cite This Page — Counsel Stack

Bluebook (online)
1 Doug. 330, Counsel Stack Legal Research, https://law.counselstack.com/opinion/galloway-v-holmes-mich-1844.