Paxton-Eckman Chemical Co. v. Mundell

112 N.E. 546, 62 Ind. App. 45, 1916 Ind. App. LEXIS 93
CourtIndiana Court of Appeals
DecidedMay 17, 1916
DocketNo. 9,053
StatusPublished
Cited by7 cases

This text of 112 N.E. 546 (Paxton-Eckman Chemical Co. v. Mundell) is published on Counsel Stack Legal Research, covering Indiana Court of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Paxton-Eckman Chemical Co. v. Mundell, 112 N.E. 546, 62 Ind. App. 45, 1916 Ind. App. LEXIS 93 (Ind. Ct. App. 1916).

Opinion

Moran, J.

Appellee purchased of appellant a large quantity of stock powders, and in the purchase thereof he alleges in his complaint that he was damaged by reason of fraud and deceit being practiced upon him by appellant. Upon issues being joined by an answer in general denial addressed to the complaint and a trial had thereon, a verdict was returned in favor of appellee in the sum of $1,750. From a judgment on the verdict, appellant has appealed, presenting for consideration of the court the sufficiency of the complaint to withstand a demurrer for the want of facts.

The principal averments of the complaint are: That appellant corporation through its servants falsely and fraudulently represented to appellee that it manufactured a commercial compound which, when fed to hogs, would prevent them from contracting cholera, and when properly fed would cause hogs to fatten more easily than if not so fed; that it had made extensive research in order to produce a medicine that would prevent such [47]*47disease and kindred diseases to which hogs were subject, and in the compounding of the P-E stock powders its desire had been accomplished; that, in order to induce appellee to purchase a larger amount thereof, it was represented to him that such stock powders would find a ready market among farmers and hog raisers, and appellee believed the representations so fraudulently made, and purchased 4,000 pounds in consideration of $400; that, in order to induce appellee to make an additional purchase, an experienced salesman called upon him and, together with appellee, visited several farmers and hog raisers in Clinton county, Indiana, and' the salesman represented to such farmers and hog raisers that the powders he desired to sell had been compounded after years of labor and experimenting upon sick hogs and, by reason of such extensive experimenting, it was found that a powder had been finally compounded that would prevent hogs from contracting cholera and kindred diseases and, when properly fed, it would cause them to fatten more easily; that such representations were falsely and fraudulently made and by reason thereof, in less than three days, such salesman sold some 800 pounds of powders, and by such false and fraudulent representations appellee was led to believe that the powders could be easily retailed to farmers and hog raisers at a profit of five cents per pound;.that appellee believed by reason of the false and fraudulent representations that the powders were so compounded that they would prevent hog cholera; that immediately after the sale of the powder by the salesman to the farmers and hog raisers aforesaid, an officer of appellant company called upon appellee and represented to him that the powder had been thoroughly tested, and he knew that it would do all that was claimed for it; that [48]*48appellee being without knowledge as to the merits of the same relied upon the representations made, which were false and known to be such by the salesman and officers of appellant company, and through their representations appellee was induced to make an additional purchase of 40,000 pounds of such powder in consideration of $3,200; that the experiment claimed to have been made by appellant’s salesman and officers as to the powder was not made and the same was not so compounded as to prevent cholera and kindred diseases of hogs, all of which appellant’s salesman and officers well knew. At the timé of the purchase of the powders by appellee, the following writing was entered into, which is made a part of the-complaint:

“Memorandum of Agreement. This memorandum of agreement made and entered into this 27th day of October, 1911, by and between Paxton-Eckman Chemical Co. (Incorporated) of South Omaha, Nebr., of the first part and J. O. Mundell of Frankfort, Indiana, the second part, Witnesseth: That the first party has this- day sold to the second party 40,000 pounds of the P-E Stock Powders, at the rate of 8 cents per pound, to be delivered F. O. B. South Omaha, Nebraska, and shipped by freight, for which the said second party has this day paid for in manner and form as follows, towit: Given his promissory note due nine months from date, secured by second mortgage. In consideration of the purchase of said powders under this contract the said first party the exclusive right to sell the P-E Stock Powders in Boone County, second party to have one of our Ford autos. The said second party agrees to diligently and energetically canvass and push the sale of said goods so furnished in the territory allotted to him. The said first party hereby reserves the right at any time, when said second party [49]*49does not sell said goods in satisfactory quantities, to cancel said contract and to enter the territory and sell out the stock of the said second party. The said first party is to have fifty per cent of the profits while assisting said second party. It is expressly agreed that all the covenants, warranties and agreements of the parties hereto are set forth in the contract, and that no other agreement, stipulation or warranty, verbal or otherwise, will be recognized unless approved or accepted in writing by the party of the first part. It is hereby made a condition precedent to the operation and non-continuation of this contract that the said second party shall handle said first, paryt’s produce exclusively.' Any infringement of the above shall constitute a forfeiture of this contract. Signed in duplicate on the day above named. Paxton-Eekman Chemical Co. E. M. Eekman, J. O. Mundell. Witness J. C. Crouse, Approved.”

The infirmities, which it is urged the complaint is subject to, may be subdivided as follows: (1) That the entire negotiations in regard to the sale and purchase of the stock powders were reduced to writing, and that appellee had an equal opportunity with appellant to know the contents of the writing before signing the same; that appellant’s liability is measured by the written contract and appellee’s remedy is confined thereto, and the contract containing none of the representations upon which appellee relies, ■ the complaint is not sufficient; (2) that the law does not hold a party responsible for the expression of an opinion as to the merits of an article offered for sale, although the same be false, where no special confidence is reposed, and that the negotiations between appellant and appellee are brought within this rule by the allegations of the complaint.

[50]*501. 2. 3. [51]*514. [50]*50It is a familiar principle of law that where a party has been fraudulently induced to enter into a contract for the purchase of property, he may retain the property and bring an action for the damages caused by such fraudulent representations, or he may rescind the contract. 20 Cyc 87; Ohlwine v. Pfaffman (1913), 52 Ind. App. 357, 100 N. E. 777; Nyswander v. Lowman (1890), 124 Ind. 584, 24 N. E. 355. Although a copy of the contract is made a part of the complaint, the action is based on fraud, hence appellant’s first objection to the complaint that appellant’s liability is measured by the contract and appellee’s remedy is confined thereto is not well taken. It is clear from the allegations of the complaint that appellee proceeded upon the theory that he was damaged by the fraudulent conduct of appellant in inducing him to purchase the stock powders in the manner set forth in the complaint.

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

Related

Shaver Motors, Inc. v. Mills (In Re Mills)
111 B.R. 186 (N.D. Indiana, 1988)
Vernon Fire & Casualty Insurance Co. v. Thatcher
285 N.E.2d 660 (Indiana Court of Appeals, 1972)
Clarke Auto Co. v. Reynolds
88 N.E.2d 775 (Indiana Court of Appeals, 1949)
City of Muncie v. State Ex Rel. Walling
6 N.E.2d 932 (Indiana Supreme Court, 1937)
Van Spanje v. Hostettler
119 N.E. 725 (Indiana Court of Appeals, 1918)
Miller v. Haney
116 N.E. 21 (Indiana Court of Appeals, 1917)

Cite This Page — Counsel Stack

Bluebook (online)
112 N.E. 546, 62 Ind. App. 45, 1916 Ind. App. LEXIS 93, Counsel Stack Legal Research, https://law.counselstack.com/opinion/paxton-eckman-chemical-co-v-mundell-indctapp-1916.