Gans v. Wormser

76 N.Y.S. 874, 73 A.D. 623
Appellate Division of the Supreme Court of the State of New York·Decided June 6, 1902·Published·Cited by 1 cases

Opinion

PATTERSON, J.

A careful examination of the record in this case satisfies us that the verdict of the jury in favor of the defendant should have been set aside on the plaintiff’s motion for a new trial on the ground that the evidence strongly preponderates against the affirmative defense to the cause of action asserted by the. plaintiff. The action was brought on a check given by the defendant to the plaintiff upon a purchase of shares of stock in a manufacturing corporation called the “American Box Trap Company.” The transaction which culminated in the agreement of purchase and sale was conducted on the defendant’s behalf by her husband, Leopold Wormser. The defendant had no personal dealings with the plaintiff. Pier defense to this action is that during the negotiations leading up to the contract of sale the plaintiff fraudulently represented to Mr. Wormser, her agent, that certain machinery used in the business of the corporation had cost $22,000, whereas in fact it cost but $6,500; that she, relying upon that representation which had been communicated to her by her husband, agreed to purchase the stock; that thereupon she gave her check payable to the order of the plaintiff for the agreed price, but, discovering the falsity of the alleged representation immediately after the check was given, she elected to rescind the sale, and thereupon stopped the'payment of the check at the bank upon which it was drawn.

The issue in the case is a narrow one of fact. The chief witness called for the defense was Leopold Wormser, who testified in positive terms that the plaintiff had represented to him that the machinery cost $22,000; that he had no means of ascertaining the cost of such machinery during the few days or weeks in which negotiations were pending between the plaintiff and himself for the purchase and sale of the shares of stock; that it was early in No[875] wember, 1897, that he first spoke with the plaintiff concerning the matter;, that about the 15th or 16th day of November he and the plaintiff went to the factory of the corporation; that he superficially looked at the machinery; that he did not have access to the books, .and had no means of verifying the plaintiff’s alleged statement respecting the cost of the machinery; and the intimation in his evidence is strong that in some indirect way he was prevented from •examining the books of the corporation containing entries respecting the cost of the machinery. He further testifies that the day after the delivery of the check, he examined the books, and ascertained the truth with respect to the cost of the machinery, and thereupon he and his wife determined to rescind the contract. He also testifies that he called upon the plaintiff at his house, and there had a conversation with him respecting the rescission of the sale and the representations alleged to have been made; that the plaintiff at once repudiated the charge of having made such representations, but declined then to decide whether he would allow the transaction to be rescinded. The evidence shows that this was a small •corporation, with a capital of $30,000, and it further shows that in addition to the sale of the stock Leopold Wormser was to have certain personal advantages by reason of such sale. He was to be associated in the management of the corporation as one of its officers. The stock to be sold was to be held conjointly by the defendant and the plaintiff, with other stock belonging to the plaintiff, so that the corporation could be controlled by those two persons, their combined stock representing the majority interest in the corporation.

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Gans v. Wormser, 76 N.Y.S. 874, 73 A.D. 623 (N.Y. Ct. App. 1902).

76 N.Y.S. 874 (Gans v. Wormser) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

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