Imágenes de páginas

tain judgment for $9.230.09 in its favor against one Kelso to defendant Files for $25 and to rescind the sale made by the receiver pursuant to the terms of that order. Thereafter, and before defendant had taken any steps to realize on the judgment, the receiver filed his motion in the nature of a bill in equity to set aside the sale on the grounds of inadequacy of consideration and failure by Files to impart to the receiver knowledge which he possessed of the existence and value of certain collaterals held by the bank as security for the payment of the judgment. We held on the former appeal that neither inadequacy of consideration alone por silence by the vendee as to his knowledge of the character or value of the thing sold warranted rescission of the contract, and to those propositions we still adhere; but we ordered the case remanded, with instructions to allow the receiver to amend his petition and to set up other facts, if such there were, which might entitle him to the equitable relief sought. Later an amended petition was filed in which it was charged that the bank held as collateral security for the payment of its judgment against Kelso three notes executed by Thomas H. Allen & Co. of Memphis, and payable to Kelso, aggregating about $9,000; that the maker of the last-mentioned notes had failed in business, and its estate was being administered in the court below for the benefit of its creditors; that before the sale of the Kelso judgment to defendant an order of distribution of 11 per cent. on all allowed claims against the estate of Allen & Co., among which was one in favor of the First National Bank on its notes held as collateral for the payment of the Kelso judgment, had been passed and by reason thereof a dividend of $989.70 was then due and payable to the receiver of the bank, and other money and property were then in the hands of the receiver of the estate of Allen & Co. sufficient to pay in all about $3,600 on the collateral so held by the bank; that while negotiations were pending for the sale of the judgment to defendant neither the receiver nor the Comptroller of the Currency, under whom he was acting, had any knowledge that the Kelso judgment was secured by the collateral mentioned, but that defendant was fully cognizant thereof, and instead of observing silence with respect thereto, as originally charged, he, with the purpose of securing the judgment for a nominal sim made statements and representations concerning the character and value of the judgment to the receiver which were false, fraudulent, misleading, and deceptive, and which did mislead and deceive him into selling the judgment for the inadequate sum of $25. Defendant in bis answer to the petition, after denying that he made any false and fraudulent statements, alleged as follows:

"The defendant further says that at the time he purchased the judgment in controversy he believed that said judgment was secured by a collateral claim against the estate of Thomas H. Allen & Co., but he did not know it, and his information was meager and unsatisfactory. He had also been informed that there were assets in the hands of the receiver of said estate for the creditors thereof, but he has never examined the records to see what dividend, if any, had been declared."

The proof fully establishes the allegation last quoted, and in our opinion goes further and discloses that defendant not only believed that the judgment was secured by collateral, but that he knew it at the time he made the purchase in question. It establishes that some time before the sale of the judgment to defendant bis attorney had seen and conversed with the receiver of Allen & Co. concerning the claim of the bank against the estate of Allen & Co., and that about the time of the purchase defendant and his attorney called on him and notified him that the bank had recovered a judgment against Kelso which had been purchased by defendant, and, as the claim of the bank against the estate was held by it as collateral security for the payment of that judgment, that he (defendant), as owner thereof, was the owner of the claim against the estate.

The evidence in the case, with the admissions found in defendant's answer. taken in connection with the fact that Files did not testify in his own behalf, satisfy us that he knew in the fall of 1902, while negotiating for the purchase of the judgment, that it was secured by the collateral in question, and that such collateral was of considerable value.

At a public sale of assets of the bank held in 1899, the judgment was offered for sale, but no bid was made for it, and it remained undisposed of.

partners only, or whether it also covered loans made to either of them as an individual provided only he borrowed it for a concern doing business in the name of H. G. & H. W. Stevens.

That issue was clearly and definitely joined in the pleadings, and was one apparently conceded not to be determined solely by the construction to be placed upon the language of the contract of guaranty, but in part by competent proof aliunde that instrument. The instrument nowhere expressly refers to the Stevenses as copartners, and Vet their joint names are referred to as together desiring to make loans of the bank. There is manifestly an ambiguity here which admits of elucidation by proof, and the parties treated the issue as one of fact to be determined by proof and much evidence of the surrounding facts, acts, and conduct of the parties was taken. On all this evidence counsel for plaintiff contend that the instrument guaran. tied advances made to a concern called "H. G. & H. W. Stevens” as it then existed, regardless of its personnel, and that a reasonable construction gathered from the language of the instrument, in the light cf surrounding circumstances and of the cotemporaneous construction placed upon it by the parties, makes this contention clear. Counsei for defendant contend, on the other hand, that all the proof shows that the instrument was intended to guaranty the payment of loans made to the Stevenses as copartners, and not otherwise. This issue dis. tinctly made in the pleadings and tried by the evidence should have been found by the trial court one way or the other, but was not. It was the vital issue in the case, and one which is now pressed upon us by both parties as decisive of it. But it is said that the trial court in effect made a finding on that issue as a result of its other findings; that the finding that the several loans which formed the basis of the suit were made by the bank to said H. G. & H. W. Stevens “relying upon and in consideration of said agreement and guaranty” is on the authority of Fox v. Haarstick, 156 U. S. 674, 15 Sup. Ct. 457, 39 L. Ed. 576, the equivalent of a finding against the defendant on the issue as to partnership tendered by him.

We think the findings as made cannot fairly be held to involve or imply a finding on the issue in question. Conceding that the loans were made "relying upon and in consideration of said agreement oi guaranty,” yet that concession does not determine what the parties meant by the ambiguous and indefinite reference to “H. G. & H. W. Stevens” found in the guaranty. In other words, the loans may have been made in reliance upon and in consideration of the guaranty, and yet may or may not have been made to H. G. and H. W. Stevens as copartners or on their joint liability.

Special findings by a trial judge in actions at law made pursuant to the provisions of Act March 3, 1865, c. 86, 13 Stat. 501, when a ury has been waived have the same effect as special verdicts of a 27. Section 649, Rev. St. 1878 (U. S. Comp. St. 1901, p. 525] ; Sorris v. Jackson, 9 Wall. (U. S.) 125, 19 L. Ed. 608; Miller v. Life 35. Co., 12 Wall. (U. S.) 285, 301, 20 L. Ed. 398. The latter must emPrace a finding on every material issue joined in the case. Patterson

United States, 2 Wheat. (U. S.) 221, 4 L. Ed. 224; Barnes v. Wiliams, 11 Wheat. (U. S.) 416, 6 L. Ed. 508; Prentice v. Zane's Adm'r,

W. S. Vchain, for appellant.
Moore, Smith & Moore, for appellee.
Before SANBORN, HOOK, and ADAMS, Circuit Judges.

ADAMS, Circuit Judge, after stating the case delivered the opinion of the court.

It is first contended by defendant that he and receiver Brown stood on an equal footing; that Brown knew, or by the exercise of ordinary care could have known, as much about the value of the judgment as he knew; and that in such circumstances the receiver had no right to rely upon any fraudulent representation or concealment which he (defendant) might have practiced. On the facts so assumed the proposition of law contended for cannot be disputed. It is well settled that where the means of knowledge are at hand and equally available to both parties, and where a party, instead of resorting to them, sees fit to confide in the statements of one whose interest it is to mislead him, the law will afford him no redress against his own imprudent confidence. Cooley on Torts, *p. 487; Slaughter's Adm'r v. Gerson, 13 Wall. 379, 20 L. Ed. 627; Farnsworth v. Duffner, 142 U. S. 43, 12 Sup. Ct. 164, 35 L. Ed. 931; Yeates v. Pryor, 11 Ark. 58; Hill v. Bush, 19 Ark. 528. But in the light of the pleadings and proof we are unable to view the facts as claimed. Defendant knew that the allowed claims of Kelso against the Allen estate stood pledged as collateral for the payment of the Kelso judgment, and he knew that they were of considerable value. Of those facts Brown knew nothing. · Neither did his immediate predecessor have any knowledge. What Cockrill, the first receiver, knew concerning them, is not disclosed; but it is a fact that, when he offered the assets of the bank at public auction in 1899, no one considered the judgment of any value. It was offered for sale, but no bid was received for it. If he then or subsequently had the assignments of Kelso's allowances against the Allen estate in his possession, they doubtless were considered of no value. They certainly disappeared, and neither they nor any memorandum of them were ever transmitted to his successors to evidence any claim of right on the part of the bank against the Allen estate. The testimony of both Brown and his predecessor, Auten, to the effect that they had no knowledge of the existence of any such claim, stands uncontradicted. But it is said that Brown could have acquired accurate information by investigating the means at hand and available to him for that purpose. It is claimed that, if he had investigated the records of Houchens v. Allen & Co., and made inquiries of the receiver in charge of the estate of that company, he could and would have ascertained the truth, We are unable to perceive, in the absence of anything in his own records, or in his own possession to suggest investigating the Houchens Case, what should have moved him to make an investigation of that any more than any other case; but suppose reasonable diligence would have put him upon some inquiry in that case, and suppose he would have discovered that certain allowances had been made in favor of Kelso, we do not perceive how that fact would have given

him any knowledge or suggestion that Kelso had assigned the claim to the bank as security for the payment of his judgment. From all the evidence we are unable to find that any such opportunities for information were open to Brown as would have put a reasonably prudent person upon inquiry concerning the facts which gave the Kelso judgment exceptional value.

This brings us to a consideration of the contents of the two letters of August 27th and October 6th, written to the receiver Brown by defendant and of their legal effect upon the transaction in question.

Defendant, with the knowledge possessed by him of the value of the judgment, was dealing with a person residing at a distance. He desired to buy the judgment. However full his information might be, he was under no obligation in law to impart that knowledge to the owner of the judgment. Files v. Brown, 124 Fed. 133, 59 C. C. 1. 403. Standing in no fiduciary relation to him, and owing him no duty to make disclosure of his information, he might have observed

trict silence on the subject and have reaped the full advantage which his diligence in securing information gave him; but any activity on his part, which directly or indirectly tended to put the vendor off his guard or mislead him to his injury, would afford ground for the Tescission of the sale.

In Laidlaw v. Organ, 2 Wheat. 178, 4 L. Ed. 214, Chief Justice Marshall stated the case and delivered the opinion of the court, as follows:

The question in this case is whether the intelligence of extrinsic circumstances, which might influence the price of the commodity, and which was exdosirely within the knowledge of the vendee, ought to have been communicated by him to the vendor? The court is of opinion, that he was not bound to comumicate it. It would be difficult to circumscribe the contrary doctrine within the proper limits, where the means of intelligence are equally accessible to both parties. But at the same time, each party must take care not to say or do anything tending to impose upon the other."

Lord Eldon, in Turner v. Harvey, Jacob's Reports, 178, after declaring the purchaser's right in general to keep silence, said as follows:

"Very little is sufficient to affect the application of that principle. If a word, if a single word, be dropped which tends to mislead the vendor, that principle will not be allowed to operate."

Pomeroy, in his work on Equity Jurisprudence (volume 2, § 901), after laying down the rule that in cases unaffected by fiduciary relations silence by one of the contracting parties having a peculiar knowledge of the subject may be observed with impunity, makes the following statement:

"If, in addition to the party's silence, there is any statement, even any word or act on his part, which tends alfirmatively to suppression of the truth, to a covering up or disguising the truth or to a withdrawal or distraction of the party's attention or observation from the real facts, then the line is overstepped, and the concealment becomes fraudulent.”

Story, in his work on Sales ( [4th Ed.] $$ 175, 177), observes as follows:

"If a rendee have private information with regard to any extrinsic fact or erent, which materially affects the value of the subject-matter of sale, he would

not be legally bound to divulge it, unless a special trust were either expressly or impliedly reposed in him. * * * Such cases are, however, closely scrutinized, and it behooves a person taking such an advantage to be careful lest he say anything which is calculated in the slightest degree to mislead, for the smallest fraud is sufficient to poison a contract. * * * If there be any studied efforts (on the part of either party to a contract of sale] to prevent the other from coming to any knowledge relating to the sale and, especially if there be any false suggestion or representation, however slight, the transaction will be fraudulent and void.”

Applying the foregoing well-established principles to the facts of this case, we cannot escape the conviction that defendant did not observe that indifferent attitude toward the transaction which was required of him. There seems to have been a covert attempt on his part to attract the receiver's attention to all the facts which minimized the value of the judgment and to turn his attention from those which magnified that value. '

Defendant had some time in September, 1902, offered $25 for the judgment at private sale. The Comptroller declined to sanction the sale for that sum, and so advised the receiver, and directed him to dispose of the judgment at public auction at the termination of his receivership. It is in the light of all these facts that the letter of October 6th should be considered. Defendant wanted to buy the judgment, had made an offer for it which had been rejected, and negotiations had apparently closed. Upon the determination of the Comptroller to sell it at public auction, defendant volunteered his good services. In the letter of October 6th he gratuituosly suggests that the sale of the judgment at public auction at the time of the termination of the receivership would postpone it so long that the statute of limitations might bar recovery upon it. He incidently alludes to Kelso's death, insolvency, and bankruptcy, and says:

"Permit me to suggest that a sale now at public auction or otherwise would give the purchaser the benefit of whatever value it might have. * * * If any value attaches now it would be lost by delay of two or three years. * * If it could be handler at once, a small sum might be realized; but even that is very doubtful. Kindly submit the matter to the comptroller," etc.

That letter, by its suggestive references to the death, insolvency, and bankruptcy of Kelso, to the worthlessness of the judgment and to the need of hasty action to realize even a small sum and prevent the bar of the statute of limitations, went far beyond that silence which the law under the circumstances permitted defendant to indulge. He had knowledge of the value of the judgment which he artfully concealed. His suggestions were well calculated to divert the mind of the vendor from inquiring concerning the value of the judgment, to forestall the public auction and secure acceptance of his once rejected offer. The receiver acted upon them, accepted the original offer, and closed the sale.

Counsel for appellant invokes the principle that mere expressions of opinion as distinguished from statements of fact are not actionable. That proposition may be conceded, but from what has already been said there is more in this case than that. There was such an artful concealment of facts by the purchaser as was calculated to and did mislead the seller, throw him off his guard, and prevent his

« AnteriorContinuar »