Wilkins v. Commercial Finance Co.Annotate this Case
75 S.E.2d 118 (1953)
237 N.C. 396
WILKINS et al. v. COMMERCIAL FINANCE CO., Inc.
Supreme Court of North Carolina.
March 25, 1953.
Rehearing Denied June 12, 1953.
*122 Eugene H. Phillips, Winston-Salem, for the plaintiffs, appellants.
William S. Mitchell, Winston-Salem, for the defendant, appellee.
The assignment of error based on the entry of the compulsory nonsuit is the only one requiring elaboration. The answer to the problem posed by this assignment of error is to be found in this well settled rule of law: "Since a party must succeed, if at all, on the case, claim, or defense set up in the pleadings, regardless of what is disclosed or established by the evidence, proofs, in order to be effectual, must correspond substantially with the allegations of the pleadings. This is true under the codes as well as under the old system of pleading. Proof without allegation is as unavailing as allegation without proof, since, in order to make a case or to entitle a party to relief, both must be present. A party cannot set up one cause of action or defense and succeed on proof of another and different cause of action not pleaded, and, unless cured by amendment, a material variance between the pleadings and the proof is fatal to a claim or defense." 71 C.J.S., Pleading, § 531. See, also, in this connection these relevant decisions: Moore v. Clark, 235 N.C. 364, 70 S.E.2d 182; Bowen v. Darden, 233 N.C. 443, 64 S.E.2d 285; Maddox v. Brown, 232 N.C. 542, 61 S.E.2d 613; Ingold v. Phoenix Assurance Co., 230 N.C. 142, 52 S.E.2d 366, 8 A.L.R.2d 1439; Stafford v. Yale, 228 N.C. 220, 44 S.E.2d 872; Suggs v. Braxton, 227 N.C. 50, 40 S.E.2d 470; Ritchie v. White, 225 N.C. 450, 35 S.E.2d 414; Coley v. Dalrymple, 225 N.C. 67, 33 S.E.2d 477; Roberts v. Grogan, 222 N.C. 30, 21 S.E.2d 829; Whichard v. Lipe, 221 N.C. 53, 19 S.E.2d 14, 139 A.L.R. 1147; Rose v. Patterson, 220 N.C. 60, 16 S.E.2d 458. The objection that there is a material variance between the allegations of the complaint and the testimony of the plaintiff is properly raised by a motion for a compulsory nonsuit. Suggs v. Braxton, supra; Whichard v. Lipe, supra. This is so because in such event there is a failure of proof on the cause of action alleged. Stafford v. Yale, supra.
It will promote clarity to make these observations at this point: The contention of the plaintiffs that apart from all other considerations the trial judge ought to have left to the jury the question whether or not the defendant unlawfully converted the Ford car to its own use is clearly untenable. Since the plaintiffs admittedly made default in the payment of the installment of December *123 22, 1950, and subsequent installments, the defendant had the legal right to detain the Ford and sell it for the satisfaction of the unpaid portion of the debt, even under the version of the dealings of the parties given in the pleadings of the plaintiffs. Alsbrook v. Shields, 67 N.C. 333; Haynes v. Temple, 198 Mass. 372, 84 N.E. 467.
The plaintiffs bottom their case on the doctrine that the statement of an intention to perform an act, when in truth no such intention exists, constitutes a misrepresentation of a fact, and as such may furnish the basis for an action for fraud if the other essential elements of fraud are present. Roberson v. Swain, 235 N.C. 50, 69 S.E.2d 15; Williams v. Williams, 220 N.C. 806, 18 S.E.2d 364; Planters Bank & Trust Co. v. Yelverton, 185 N.C. 314, 117 S.E. 299; Herndon v. Durham & S. R. Co., 161 N.C. 650, 77 S.E. 683. The gravamen of their complaint is that the plaintiffs and the defendant made a contract whereby the defendant promised to procure and keep in force during a specified period a policy of collision insurance insuring the plaintiffs against loss or damage exceeding $50.00 caused by the collision of their Ford with any other object, and that in making such promise the defendant practiced a fraud upon the plaintiffs in that it actually intended not to perform the promised act.
It is manifest that the testimony adduced by the plaintiff's and the clarifying consistent testimony offered by the defendant negates the cause of action alleged by the plaintiffs if it shows that the contract between the parties is embodied in the promissory note, the purchase-money chattel mortgage, and the stipulation. This is necessarily so for the very simple reason that these writings plainly exclude any promise on the part of the defendant to insure the Ford car for the benefit of the plaintiffs.
This case is much simplified when the judicial gaze is focused steadily on the crucial circumstance that the pleadings of the plaintiffs do not allege that the execution of these documents was procured by fraud, or that, by reason of fraud, they do not express the true intentions of the parties. Willett v. National Accident & Health Insurance Co., 208 N.C. 344, 180 S.E. 580; Hill v. Star Insurance Co., 200 N.C. 502, 157 S.E. 599; F. L. Voliva Hardware Co. v. Kinion, 191 N.C. 218, 131 S.E. 579. When they prepared their complaint, the plaintiffs emulated the ostrich and ignored the very existence of the written instruments. When they filed their reply, the plaintiffs undertook to decry the legal importance of the writings by the somewhat nonchalant allegation that they did not constitute a contract at all, but were merely manufactured by the plaintiffs and the defendant to make it appear that the transaction between the parties was a discount or sale rather than a usurious loan. We note, in passing, that under G.S. § 24-2, usury does not invalidate a contract. It simply works a forfeiture of the entire interest, and subjects the lender to liability to the borrower for twice the amount of interest paid. Rogers v. Booker, 184 N.C. 183, 113 S.E. 671.
The evidence under scrutiny indicates that the male plaintiff had oral negotiations with the defendant, which was represented by its president; that the negotiations resulted in an oral agreement whereby the defendant agreed to advance $900.00 to the use of the plaintiffs on the security of the Ford car which they were buying from the C. W. Myers Trading Post, Inc., whereby the plaintiffs consented to pay the defendant $1,334.40 for the advancement in 24 monthly installments of $55.60 each, and whereby the defendant promised to procure and keep in force pending the payment of all of the 24 installments a policy of collision insurance insuring the plaintiffs against loss or damage exceeding $50.00 caused by the collision of the Ford car with any other object; that the plaintiffs executed the promissory note, the chattel mortgage, and the stipulation for the purpose of reducing the oral agreement to writing; and that the plaintiffs were wilfully misled into executing these writings without reading them by the false assurance of the president of the defendant that they correctly embodied the oral agreement of the parties.
The pleadings of the plaintiffs do not attack the written instruments for *124 fraud or other invalidating cause. This being true, it must be conclusively presumed under the evidence and pleadings in this particular case that the writings supersede the oral agreements of the parties and express their actual engagements. Bost v. Bost, 234 N.C. 554, 67 S.E.2d 745; Mc-Lawhorn v. Briley, 234 N.C. 394, 67 S.E.2d 285; Potter v. National Supply Co., 230 N.C. 1, 51 S.E.2d 908; Whitehurst v. FCX Fruit and Vegetable Service, 224 N.C. 628, 32 S.E.2d 34; Home Owners' Loan Corp. v. Ford, 212 N.C. 324, 193 S.E. 279; Jefferson Standard Life Insurance Co. v. Morehead, 209 N.C. 174, 183 S.E. 606; Security Nat. Bank v. Sternberger, 207 N. C. 811, 178 S.E. 595, 97 A.L.R. 720; Oliver v. Hecht, 207 N.C. 481, 177 S.E. 399; Winstead v. Acme Manufacturing Co., 207 N.C. 110, 176 S.E. 304; Ray v. Blackwell, 94 N.C. 10. Since the writings exclude any promise on the part of the defendant to provide insurance on the Ford car for the benefit of the plaintiffs, there is a material variance between the allegations and the proofs. This being true, the trial judge did not err in dismissing the action upon a compulsory nonsuit.
While the evidence is insufficient to support the cause of action presently pleaded by plaintiffs, it does tend to show that the plaintiffs may have a meritorious cause of action against the defendant under the rule that a false assurance as to the contents of a written instrument constitutes a misrepresentation of a fact, and as such may furnish the basis of an action for fraud if the other essential elements of fraud are present. Butler v. Armour Fertilizer Works, 193 N.C. 632, 137 S.E. 813; Grace & Co. v. Strickland, 188 N.C. 369, 124 S.E. 856, 35 A.L.R. 1296; McCall v. Toxaway Tanning Co., 152 N.C. 648, 68 S.E. 136; Jones v. Life Insurance Co., 151 N.C. 54, 65 S.E. 602; Whitehurst v. Life Ins. Co., 149 N.C. 273, 62 S.E. 1067; Stroud v. Life Insurance Co., 148 N.C. 54, 61 S.E. 626; Sykes v. Life Insurance Co., 148 N.C. 13, 61 S.E. 610; Griffin v. Roanoke R. & Lumber Co., 140 N.C. 514, 53 S.E. 307, 6 L.R.A.,N.S., 463; Caldwell v. Life Insurance Co., 140 N.C. 100, 52 S.E. 252; 23 Am.Jur., Fraud and Deceit, section 96. Whether the plaintiffs should bring a new action against the defendant upon a complaint conforming to the evidence in this case is a matter for them and their counsel to ponder and decide. If they should take such course, they would do well to note the general rule that ordinarily exemplary, punitive, or vindictive damages are not recoverable in an action for fraud. 37 C.J.S., Fraud, § 144.
The case illustrates anew the oft recurring truth that procedural mishaps befall litigants who shadow box with unrealities in their pleadings.
For the reasons given, the judgment of nonsuit is affirmed.