Krause v. Reichel

167 N.W. 817, 167 Wis. 360, 1918 Wisc. LEXIS 124

• Court: Wisconsin Supreme Court
• Decided: April 30, 1918
• Status: Published

Opinions

Winslow, C. J.

There was' sufficient evidence to support tbe findings of fact of tbe trial court negativing fraud on tbe part of Reiehel. Tbe statement in tbe written agreement that there have been “no representations, warranties, or guaranties with reference to said business, property, or otherwise, or tbe income therefrom, except those herein fully set out,” except that tbe average gross income of tbe business for tbe year has been $220 a month, may not perhaps be conclusive on tbe plaintiffs, but it is certainly of much weight when it is remembered that tbe plaintiffs were sui juris, of average intelligence and brightness, and that tbe contract was read over, to them and explained to them before signature, and that they made no claim of any deception or fraud until they bad, through their own fault, lost tbe business.

It appears by tbe testimony of tbe general agent, Mr. Nichols, that be would not have accepted Reiehel’s advice as to tbe appointment of Krause as bis successor bad be known that Reiehel bad attempted to sell tbe business by bis contract with Krause, and tbe fact that Reiehel concealed tbe attempted sale from Nichols is much relied on as a fraud upon Krause and bis wife. We are not able to see, however, that this fact in any way concerns tbe plaintiffs or affects their rights. They received just what they bargained for and knew they were bargaining for. They lost tbe agency, not by reason of any act of Reichel’s, but by reason of their own inefficiency or worse in the condiict of the business. There is no proof or intimation that the company would have discharged Krause so long as he was rendering faithful and satisfactory service, even had the prior contract with Reichel been discovered after he had entered on his work. Reichel’s lack of candor and frankness with the company does not seem to have in any way affected the situation or the plaintiffs’ rights at any time. Practically the only complaints the plaintiffs now have to make in their testimony is that Reichel had in fact no business to sell and that he ought to have told them that Krause would not be able to transact the business and hold the job. As we have seen, all the parties understood that Krause could be discharged at any time if his work was not satisfactory, and, knowing this, they necessarily knew that there was no “business,” in the ordinary sense of the word, to sell. As to the second contention just named, the fact seems clear that Krause had full information as to the nature of the business and the demands which it made on business capacity.

It may well be that the plaintiffs made a poor bargain, indeed this seems fairly well proven, but they made it with their eyes open and were not defrauded. They paid or agreed to pay a gross sum for the personal property and for the effort of Reichel to procure the agency for them. It cannot be said that they paid any definite part of the consideration for this effort or influence and another definite part for the personal property; in other words, the contract is not separable. There was a tangible consideration (i. e. the equipment) and an intangible one, namely, the successful exertion of influence to obtain the agency for Krause. Taken together they may be inadequate, but mere inadequacy of consideration alone is not a fatal defect or cause for rescission unless the inadequacy be so gross as to prove fraud by its very inadequacy under the circumstances, and we cannot say that the present is such a case. Rust v. Fitzhugh, 132 Wis. 549, 112 N. W. 508. _

It was entirely competent for Mrs. Krause to give a valid mortgage on her own property in payment of or as security for her husband’s debt. Fitzgerald v. Dunn, 112 Wis. 37, 87 N. W. 803.

By the Gourt. — Judgment affirmed.