Calloway v. Wyatt

Annotate this Case

97 S.E.2d 881 (1957)

246 N.C. 129

J. B. CALLOWAY and wife, Ina Calloway, v. Verna WYATT.

No. 389.

Supreme Court of North Carolina.

May 1, 1957.

*884 W. H. McElwee and W. L. Osteen, North Wilkesboro, for plaintiffs-appellants.

Whicker & Whicker, by J. H. Whicker, Sr., North Wilkesboro, for defendant-appellee.

PARKER, Justice.

Plaintiffs state in the beginning of their brief: "The plaintiffs' evidence intended (sic) to show false representation on the part of the defendant, that the defendant knew the representation was false at the time it was made and at (sic) this representation was made with the intent to induce the plaintiffs to part with their funds for the purpose of defrauding the plaintiffs." These are the closing words of their brief: "If the evidence is to be believed, the statements as to water supply were false. They were made under circumstances which would permit the jury to infer the purpose was to induce the plaintiff to pay more for the property to his detriment. These are some of the inferences which a jury might draw from the evidence."

It is clear that plaintiffs base their action upon fraud. Their evidence makes out no case of breach of warranty. See Jones v. John Lewis Furniture Co., 222 N. C. 439, 23 S.E.2d 309, which was an action to recover for an alleged breach of express warranty. In that case the complaint alleged defendant's salesman guaranteed to plaintiffs that a second-hand bed was free of bed bugs; that relying upon said guarantee, plaintiffs purchased the bed; that the bed was infested with bugs; and thereby the warranty was breached. A demurrer ore tenus to the complaint was allowed in this Court, on the ground it did not state a cause of action.

"The court can not submit a case to the jury on a particular theory unless such theory is supported by both the preadings and the evidence." Cox v. Hennis Freight Lines, 236 N.C. 72, 72 S.E.2d 25, 28. This Court said in McKee v. Lineberger, 69 N.C. 217, 239: "Proof without allegation is as ineffective as allegation without proof." A plaintiff cannot make out a case which he has not alleged. Aiken v. Sanderford, 236 N.C. 760, 73 S.E.2d 911; Whichard v. Lipe, 221 N.C. 53, 19 S.E.2d 14, 139 A.L.R. 1147.

A complaint must allege a cause of action by a statement of proper facts. Even under the liberal construction of pleadings required by G.S. § 1-151, a court cannot construe into a pleading that which it does not contain. Jones v. John Lewis Furniture Co., supra; McIntosh, North Carolina Practice and Procedure, 2d Ed., Vol. I, p. 555.

No fiduciary or confidential relationship is alleged or shown in the instant case. We have many cases setting forth the essential elements of actionable fraud. One of these elements is that the defendant made the false representation with intention that it should be acted upon by plaintiff, or as otherwise phrased, with intent to deceive. Stone v. Doctors Lake Milling Co., 192 N.C. 585, 135 S.E. 449; Cofield v. Griffin, 238 N.C. 377, 78 S.E.2d 131, 40 A. L.R.2d 966; Lamm v. Crumpler, 240 N.C. 35, 81 S.E.2d 138; Early v. Eley, 243 N.C. 695, 91 S.E.2d 919.

A pleading setting up fraud must allege the facts relied upon to constitute fraud, and that the alleged false representation was made with intent to deceive plaintiff, or must allege facts from which such intent can be legitimately inferred. McLane v. Manning, 60 N.C. 608; Anderson v. Rainey, 100 N.C. 321, 5 S.E. 182; *885 American Exch. Nat. Bank v. Seagroves, 166 N.C. 608, 82 S.E. 947; Colt Co. v. Kimball, 190 N.C. 169, 129 S.E. 406; Griggs v. Griggs, 213 N.C. 624, 197 S.E. 165; Hill v. Snider, 217 N.C. 437, 8 S.E.2d 202; Patuxent Development Co. v. Bearden, 227 N.C. 124, 41 S.E.2d 85; Davis v. Whitehurst, 229 N.C. 226, 49 S.E.2d 394; 37 C.J.S. Fraud §§ 83-84; 24 Am.Jur. Fraud and Deceit § 247.

"It is accepted in this jurisdiction that the facts relied upon to constitute fraud, as well as the fraudulent intent, must be clearly alleged." Colt Co. v. Kimball [190 N.C. 169, 129 S.E. 407], supra. In Stone v. Doctors Lake Milling Co. [192 N. C. 585, 135 S.E. 450], supra, the Court said: "A complaint which failed to allege that the fraud charged against the defendant was intended to injure the plaintiff was held defective in Farrar v. Alston, 12 N.C. 69. * * * A complaint which contains no allegation of a fraudulent intent, or facts from which it may reasonably be inferred, fails to state a cause of action for deceit, and such defect may be taken advantage of by demurrer. Bryan v. Spruill, 57 N.C. 27."

It is not alleged in the complaint that the false representations were made by the defendant with intent to deceive the plaintiffs. There is no allegation that the defendant intended such representations to be acted on by the plaintiffs, or that they were made by defendant with the knowledge or expectation that they were to be acted on by plaintiffs. In the complaint there is no averment the representations were fraudulently made, or that they were knowingly false, or that the representations were made with a reckless disregard of their truth or falsity, and with the intent that they be acted on, or that the false statement was made unqualifiedly by defendant as of her own knowledge and with intent to induce action. In our opinion, there are not sufficient averments of facts in the complaint from which the equivalent of an intent to deceive may be legitimately implied. The complaint fails to allege a case of actionable fraud, and is fatally defective.

Plaintiff J. B. Calloway testified on crossexamination: "I did know when I came over here that the wells were going dry all over this country and the springs were. That is the reason I was so anxious about water to inquire about it. I didn't turn the spigot on and make an investigation because she was so earnest about plenty of water, plenty of water." The volume of water in the well on the premises was a fact that could have been determined by the plaintiffs by the exercise of the slightest diligence on their part by turning on the spigots before the purchase. When the power was off, they could easily have waited until the power was on and turned on the spigots, before consummating the purchase. It was not necessary to measure the water in the well to determine its amount, because shortly after the purchase J. B. Calloway turned on the spigots and found the water shortage. The complaint contains no allegation that plaintiffs were prevented by the artifice of the defendant, or by any act on her part, from making an examination to find out about the water in the well.

This Court said in Harding v. Southern Loan & Ins. Co., 218 N.C. 129, 10 S.E.2d 599, 602: "`It is generally held that one has no right to rely on representations as to the condition, quality or character of property, or its adaptability to certain uses, where the parties stand on an equal footing and have equal means of knowing the truth. The contrary is true however where the parties have not equal knowledge and he to whom the representation is made has no opportunity to examine the property or by fraud is prevented from making an examination.' 12 R.C.L., 384. When the parties deal at arms length and the purchaser has full opportunity to make inquiry but neglects to do so and the seller resorted to no artifice which was reasonably calculated to induce the purchaser to forego investigation, *886 action in deceit will not lie. Cash Register Co. v. Townsend, 137 N.C. 652, 50 S.E. 306, 70 L.R.A. 349; May v. Loomis, 140 N.C. 350, 52 S.E. 728; Frey v. Middle Creek Lumber Co., 144 N.C. 759, 57 S.E. 464; Tarault v. Seip, 158 N.C. 363, 369, 74 S.E. 3; 23 A.J., 981."

This Court also said in Keith v. Wilder, 241 N.C. 672, 86 S.E.2d 444, 447, after stating the principle of law set forth immediately above: "But the rule is also well established that one to whom a positive and definite representation has been made is entitled to rely on such representation if the representation is of a character to induce action by a person of ordinary prudence, and is reasonably relied upon. 23 A.J. 970, Restatement Torts, secs. 537, 540."

The right to rely on representations is inseparably connected with the correlative problem of the duty of a representee to use diligence in respect of representations made to him. The policy of the courts is, on the one hand, to suppress fraud and, on the other, not to encourage negligence and inattention to one's own interest.

Plaintiffs knew there was a shortage of water in the wells and springs in that section. With that knowledge, it would seem that the repeated and vague statements of the defendant "plenty of water, plenty of water" would naturally tend to arouse the suspicion of the plaintiffs that the representations were false, and that such representations were not of a character to induce action by a person of ordinary prudence. Under such circumstances the law imposed upon plaintiffs the duty of turning on the spigots, or making some investigation, to find out about the water supply, and failing to do so, they cannot avail themselves of the seller's misrepresentations 23 Am.Jur., Fraud and Deceit, Section 157; Annotation 61 A.L.R., pp. 513-514; 37 C.J.S. Fraud § 31.

In Hays v. McGinness, 208 Ga. 547, 67 S.E.2d 720, 721, the false representations were "that the well on said land (which was the only water supply on said land) would at all seasons of the year furnish a sufficient supply of water for the usual domestic purposes of a family of four; for household use, cooking, drinking, bathing, and laundry and for the maintenance of such livestock as is usual on a small farm of 15 acres, as one cow, one mule, two hogs and 50 chickens." Petitioners showed that a reasonable and adequate supply of water for a household, domestic, and farm purposes for a family of four (including two small children) is from 75 to 100 gallons per day, and that the well did not at any time furnish a supply of water sufficient for domestic and household use, and that the water in said well was seepage water only, and that said well at no time contained more than 30 gallons of water a day. The Syllabus by the Court is as follows: "A sale of land will not be vitiated by false representations of the seller as to the quality or condition of the land, where the purchaser had sufficient opportunity to examine the subject of the representations but made no examination or investigation, and was not prevented from so doing by any artifice of the seller; and where, as here, the representations relate to the volume of water in a well and its daily flow, the purchasers will not be heard to complain, as they were wilfully negligent in not exercising the slightest diligence to ascertain this question themselves, nor do they allege that they were prevented from doing so by any artifice of the seller."

The judgment of compulsory nonsuit entered below is