Joseph v. Sears Roebuck & Co.

77 S.E.2d 583, 224 S.C. 105, 40 A.L.R. 2d 742, 1953 S.C. LEXIS 80

• Court: Supreme Court of South Carolina
• Decided: September 9, 1953
• Docket: 16777
• Status: Published

Opinions

Oxner, Justice.

This is an action to recover damages for breach of an alleged oral warranty by appellant with respect to the safety of a pressure cooker sold to respondent. The trial resulted in a verdict for respondent in the sum of $2,500.00. The major question for determination is whether the Court below erred in not granting a motion by appellant for a nonsuit, and later for a directed verdict, upon the ground that the alleged warranty was unenforceable because not in writing as required by the 5th clause of the 4th section of the Statute of Frauds, Section 11-101(5) of the Code ofT952, which provides that no action shall be brought to charge any person upon any oral agreement “that is not to be performed within the space of one year from the making thereof.”

Although the record contains the entire testimony taken at the trial, we need only state the facts pertinent to the questions raised by the exceptions. In January, 1949, respondent bought a pressure cooker from appellant for $16.95, which was paid in cash. Among the representations which respondent alleged were made to and relied upon by her at the time of the sale, were that appellant’s saleslady stated that said pressure cooker “was safe in every respect” for use in cooking; “that there was no danger whatever” in using it; and that in view of the safety devices thereon, “no explosion was possible.” In support of the foregoing allegations in .the complaint, respondent testified that having heard conflicting reports as to the safety of pressure cookers, she specifically inquired whether there was any danger in such a utensil exploding, to which the saleslady replied: “There is no possible danger in these things exploding.” She further testified that the saleslady told her that it was impossible for the cooker to “blow up because Sears had this device on it that would go off at 35 lbs. pressure, that there was no way, shape or form for it to explode.” She said that she was wholly unfamiliar with the operation of pressure cookers and relied on the foregoing representations and warranties in making the purchase.

Respondent used this utensil rather regularly until November 23, 1950. While cooking dinner on that day, it exploded and as a result, respondent was burned, her stove demolished and the house considerably damaged. No question is raised as to the amount of the verdict.

Appellant strenuously denied ever making to anyone a warranty of the character claimed by respondent and offered testimony to the effect that an explosion of one of its pressure cookers could only result from improper care and use. All conflicts in the testimony have now been resolved by the verdict of the jury in favor of respondent, and we must assume on this appeal that an oral warranty was made as claimed by respondent and through no fault of hers, the utensil exploded within about two years after it was purchased, resulting in damages as found by the jury.

The only question for our determination is whether the oral warranty upon .which this action is based is within the 5th provision of the 4th section of the Statute of Frauds. Appellant contends that the statute applies because the alleged warranty was impossible of performance within a year. In support of this contention, appellant offered testimony to the effect that with proper use, one of these pressure cookers would last from ten to fifteen years. However,' one of its witnesses admitted that it was “possible for one to wear out in a year,” and another that she had heard of explosions occurring within a year.

The question of whether a warranty as to the quality or condition of a chattel must be in writing when the life of such article ordinarily extends beyond a year is an important one. If appellant’s view is accepted, most oral warranties would be unenforceable. Although cases are legion sustaining a recovery of damages for breach of an oral warranty with respect to the condition or quality of chattels sold, no decision has been cited, and we have found none, holding that such warranty was unenforceable because it constituted an oral agreement which was not to be performed within one year from its making. The fact that the Statute of Frauds has never been raised in any of these cases is significant.

General statements to the effect that oral warranties made in connection with the sale of personal property need not be in writing will be found in numerous cases and textbooks. In Mechem on Sales, Volume II, Section 1235, it is stated: “In order to constitute an express warranty no particular language is necessary. It is not required that it shall be in writing, or be made in specific terms; and it is not at all necessary that the word ‘warrant’ or ‘warranty’ shall be used.” (Italics ours). Again, in Section 1253, we find: “A warranty, as such, is not required to be in writing. Even though the value of the goods was such as might have brought the contract to sell within the operation of the statute of frauds, the oral warranty will suffice. The defendant may, of course, contend that there was no sale because the statute was not complied with; but if there were a valid sale, as where, for example, there has been a delivery and acceptance sufficient to satisfy the statute, it is not necessary for the warranty to be in writing.” The following is taken from 77 C. J. S., Sales § 308 (b) : ‘It is not essential that a warranty in the sale of chattels be in writing; the contract of warranty may be valid whether oral or written.’” To the same effect, see 46 Am. Jur., Sales, Section 313; Distillers Distributing Corporation v. Sherwood Distilling Company, 4 Cir., 180 F. (2d) 800; Woolsey v. Zieglar, 32 Okl. 715, 123 P. 164; Seale v. Schultz, Tex. Civ. App., 3 S. W. (2d) 563; Conkling v. Standard Oil Co., 138 Iowa 596, 116 N. W. 822.

The first question which suggests itself is whether a warranty of the character involved in this. case constitutes an agreement within the purview of the statute now invoked. Does such an oral warranty constitute a promise of some act to be performed by the seller within the contemplation of the statute ? Or does such a warranty mean that the promisor is not to do any act upon the happening of the event warranted against, but upon such happening liability arises by law without any act to be performed on his part ? These are interesting questions which we shall not now undertake to decide. We shall assume that the warranty involved in this case is an agreement of such nature as to be within the contemplation of the statute.

It is well settled that the statute applies only to an agreement which cannot be performed within a year. In Cline v. Southern Railway Co., 110 S. C. 534, 96 S. E. 532, 538, the Court quoted with approval the following from McPherson v. Cox, 96 U. S. 404, 416, 24 L. Ed. 746: “In order to make a parol contract void it must be apparent that it was the understanding of the parties that it was not to be performed within a year from the time it was made.” In Weber v. Perry, 201 S. C. 8, 21 S. E. (2d) 193, 194, the Court said: “There can be no dispute as to the well established principle that the statute applies only to those contracts which are impossible of performance within a year and that a contract on a contingency which may occur within the year need not be supported by a writing.” If there is a possibility of performance within a year, the agreement is not within the statute. The fact that performance within a year is highly improbable or not expected by the parties does not bring a contract within the scope of this clause. Accordingly, it has been held that a contract to employ another “for an indefinite period (of time) so long as plaintiff’s work was satisfactory” was not within the statute. Cline v. Southern Railway Co., supra, 110 S. C. 534, 96 S. E. 532. A similar conclusion has been reached as to an agreement which was construed by the Court as being one to “employ the plaintiff for the rest of his natural life as long as he did his work in a satisfactory manner.” McGehee v. South Carolina Power Co., 187 S. C. 79, 196 S. E. 538, 541. Numerous other decisions of this Court illustrating the principles heretofore stated could be cited. There is an interesting review of the English cases in Warner v. Texas & P. R. Co., 164 U. S. 418, 17 S. Ct. 147, 41 L. Ed. 495. Among them was one holding that an oral agreement by which the defendant promised, for one guinea paid, to pay the plaintiff so many at the day of his marriage was not within the statute, although the marriage did not take place within the year. The Court said that marriage might have happened within a year after the agreement. Another English case reviewed held that a promise to pay so much money upon the return of a certain ship, which ship happened not to return within two years after the promise made, was not within the statute, “for that by possibility the ship might have returned within a year; and although by accident it happened not to return so soon, yet, they said, that clause of the statute extends only to such promises where, by the express appointment of the party, the thing is not to be performed within a year.” Anon., 1 Salk, 280.

It is also uniformly held that the statute does not apply when by the happening of a contingency the defendant may be required to perform his contract within a year. In Gadsden v. Lance, McMul. Eq. 87, the Court said: “It is equally well settled that when the agreement is to be performed on a contingency, which may or may not happen within the year, a note in writing is not necessary, unless it appears from the agreement that it was to be performed after the year.” To the same effect, see Thompson v. Gordon, 3 Strob. 196; Walker v. Wilmington, C. & A. Railroad Co., 26 S. C. 80, 1 S. E. 366; Oswald v. Lawton, 187 S. C. 42, 196 S. E. 535. It is on this principle that it has been held that an oral contract of insurance, although extending beyond a period of one year, is not within the statute because the liability of the insurer thereon may occur within the year by the happening of the contingency insured against. 49 Am. Jur., Statute of Frauds, Section 41; Restatement of the Law of Contracts, American Law Institute, Section 198. In Globe Indemnity Co. v. Cooper Motor Lines, 206 S. C. 154, 33 S. E. (2d) 405, 406, the Court stated that “an oral contract to insure is not within the statute of frauds, since it may be completely performed within a year upon the happening of a contingency.”

The oral warranty in the instant case will now be considered in the light of the foregoing principles. In effect, appellant said to respondent: “The pressure cooker is not dangerous and will not explode. If it does explode, we shall indemnify you or be responsible in damages.” The testimony shows that it was possible for the explosion to have occurred within a year. The fact that it did not occur in the instant case until almost two years does not affect the question. If the warranty sued on is within the statute, it would be unenforceable whether the breach occurred the day after the sale or ten years thereafter. We think the warranty was one subject to a contingency which might occur within one year after its making and therefore not within the statute.

The cases relating to oral contracts of insurance are closely analogous. “Ordinarily, a warranty is an agreement to be responsible for all damages that arise from the falsity of a statement or assurance of a fact. In other words, a warranty promises indemnity against defects in an article sold.” 46 Am. Jur., Sales, Section 299. In Stucky v. Clyburn, Cheves 186, it is stated: “The contract of warranty is an undertaking to indemnify for any injuries sustained by the breach of it.” An insurance contract is likewise a contract of indemnity. The insurer undertakes to indemnify another against loss, damage or liability arising from an unknown or contingent event. Liability on either contract is dependent on a contingent event which may happen within or beyond the year after the making thereof. We do not think the instant case can be distinguished in principle from those upholding the validity of oral contracts of insurance.

It is argued by appellant that its contingent liability under the alleged warranty did not cease when one explosion occurred, but continued for the life of the cooker, which, according to appellant’s testimony, extended over a period of ten or fifteen years. On this theory it is claimed that the contract could not be performed within a year. It might be first stated that it is certainly far-fetched to say that the parties contemplated that there might be repeated explosions and a series of injuries resulting therefrom. On the contrary, it is more reasonable to suppose that they thought that an explosion would result in the destruction of the cooker. Moreover, appellant has misconceived the nature of this warranty. It was not one to keep the utensil in repair but to indemnify respondent against loss by explosion. In effect, the warranty was that the cooker would not explode as long as it was used by respondent. If it were for any cause damaged beyond repair, sold or abandoned, or for any other reason respondent ceased to use it, the warranty was at an end. Either of these events could happen within a year. It makes no difference what the normal life of the cooker was, the agreement was to compensate upon the happening of an event which could occur within a year.

Our decisions, in line with the great weight of authority elsewhere, are to the effect that an agreement to be performed on the death of a person is not within the statute because death may occur within a year, although the life expectancy of such person may be for a much longer period. Thompson v. Gordon, supra, 3 Strob. 196; 49 Am. Jur., Statute of Frauds, Section 30. Is it reasonable to say that an agreement to pay upon the death of a young man, in fine physical condition, with a long life expectancy, is not within the statute because his death may occur within a year, but that an agreement to pay upon the explosion of a pressure cooker is within the statute, because its normal life is for a period of ten or fifteen years ? Is death more likely to occur within a year than an explosion ? Here the explosion occurred within two years, or within a period of time far less than the normal expectancy.

The agreement in the instant case is quite different from that involved in Jones v. McMichael, 12 Rich. 176, as well as that before the Court in Rowland & Sons, Inc., v. Bock, 150 S. C. 490, 148 S. E. 549. Both of these cases upon which appellant strongly relies are readily distinguishable. In the Jones case there was no definite time fixed for performance, but the facts showed that the parties necessarily contemplated that performance would take more than a year. .There was no element of contingency involved in the contract. The Rowland case involved an alleged oral agreement on the part of the landlord to construct an addition to the rented premises and keep it at all times “in repair and in a safe and suitable condition for the purposes for which said premises were leased.” The lease extended over a period of seven years and the agreement to keep in repair was coextensive with it.' The contract there contemplated a continued and repeated course of positive action over a period of years, an altogether different situation from that presented in the instant case.

Appellant expresses great apprehension as to the liability of merchants if it is held that a warranty of this kind can be made orally. But it is doubtful whether the possibility of perjury or fraud is any greater in the case of an oral warranty as to the condition or quality of chattels than that which exists in the case of the many other agreements that can be made orally. Be that as it may, we are not at liberty to enlarge the statute. That is the prerogative of the Legislature.

The learned trial Judge held that the agreement was not within the statute because it had been fully executed on the part of the respondent by payment of the purchase price at the time of sale. This construction may be sound but in view of the fact that we have concluded for other reasons that the statute does not apply, it is not necessary to pass upon the ground advanced by the Court below and we prefer to intimate no opinion thereabout.

The remaining exceptions relate to the charge.

It is contended that the Court erred in mentioning to the jury during the course of the charge that South Carolina followed the rule of the civil law that a sound price warrants a sound commodity. It is said that an implied warranty of this kind had no application to the case and was misleading and confusing.

The Court, in substance, instructed the jury that the burden was upon respondent to prove the alleged oral warranty; that although in South Carolina a sound price warranted a sound article, the plaintiff had not elected to sue upon an implied warranty and could not recover on such theory; that she had elected to proceed upon an express warranty “that this pressure cooker was a safe device and that it would not or could not explode”, and “that she’s got to prove that the first thing of all and if she doesn’t satisfy you of that by the greater weight of the evidence, you needn’t go any further in your investigation, you would have to return a verdict in favor of the defendant.”

It is difficult to see how appellant was prejudiced by the statement complained of. The error, if any, was harmless. Moreover, under the circumstances the Court was justified in telling the jury that respondent could not recover on the theory of any implied warranty that a sound price warrants a sound article. Such an instruction was helpful in undertaking to present squarely to the jury the issues which they were to determine.

By another exception it is claimed that the Court erred in charging that the Statute of Frauds had no application to the case and that this defense should not be considered. For the reasons heretofore stated, we think this was a correct statement. It was proper for the Court to tell the jury that the defense of the Statute of Frauds contained in the answer had been eliminated.

The remaining exception to the charge can better be understood by this preliminary statement. Appellant alleged that each sale of a pressure cooker was accompanied by a printed book of instructions, which contained the only warranty or guaranty made to a purchaser. The “guarantee” contained in this booklet purports to limit appellant’s liability for defects. Respondent denied that any such booklet was given to her or called to her attention. The Court charged the jury that any such warranty or limitation of liability “would have had to have been called to the attention of the purchaser at the time of the purchase and the purchase would have had to have been made with the knowledge of that for it to have been sold upon a written warranty.” This instruction was substantially in accord with the rule stated in Stevenson v. B. B. Kirkland Seed Co., 176 S. C. 345, 180 S. E. 197, and Reliance Varnish Co. v. Mullins Lumber Co., 213 S. C. 84, 48 S. E. (2d) 653. There is no merit in this exception.-

All exceptions are overruled and the judgment below affirmed.

Fishburne, Stukes and Taylor, JJ., concur. Baker, C. J., dissents.