Steele v. Brazier

1. ATTACHMENT: Ground That Debt Sued For Was Fraudulently Contracted Not Sustained. Where plaintiff is induced by false and fraudulent representations to purchase from defendant and pay for two shareholders’ contracts for deeds issued under the name of a colonization company, and on discovering the fraud sues for money had and received; Held, that in such case an attachment cannot be sustained under the fourteenth subdivision of the attachment act (where the debt sued for was fraudulently contracted on the part of the debtor) for the reason that the debt sued for was not fraudulently of otherwise contracted by defendant. [Following Finley v. Bryson, 84 Mo. 664.1 2. -: Debt Fraudulently Contracted. Under the fourteenth subdivision of the attachment act, a debt to be fraudulently contracted must have been the result of some material depeptive act, word or concealment on the part of the debtor done or suffered by him with the intention to induce the opposite party to consent to a debt and the fraudulent transaction must culminate in a debt. The unlawful conversion or fraudulent act of a party whereby he secures the property or money of another, although the law implies a promise on the part of the wrongdoer to reimburse the party defrauded, does not create a debt within the meaning of the attachment act. 3. ACTIONS: Assignable When Arising Out of Contract. Where parties are induced to purchase shareholders’ contracts for deeds in a colonization company through the false and fraudulent representations of defendant, they each have a cause of action for money had and received and this action arises out of contract and under section 540, Revised Statutes 1899, is assignable. 4'. -: -: Assignment of Contract: Rights of Assignee. In an action for money had and received growing out of false and fraudulent representations made to several parties by defendant in the sale of certain contracts for deeds, an assignment to plaintiff of the contracts by the several holders thereof is not an assignment of their cause of action for money hadi and received. 5. PLEADING: Amendment: Departure. The statute in regard to amendments was intended to be so liberalized as to cure all sorts of defects of form and to permit the correction of any error in the substantial features of the case on timely application; but a new or different cause of action cannot be supplied by an amended petition. Such an amendment constitutes a departure. O. -: -: -: Tests For Distinguishing An Amendment From A New Cause of Action. The tests in determining whether the amended petition is an amendment or the substitution of a new cause of action are: (1), that the same evidence will support both petitions, (2), that the same measure of damages will apply to both. If both of these fail, the new pleading is not an amendment but a substitution of a new cause of action. T. -: -: -: Making Petition Definite and Certain Not a Departure. An amended petition which makes definite and certain that which before was indefinite and uncertain is proper and does not constitute a departure. 8. -: -: -: Stating Additional Cause of Action. Plaintiff will not be allowed to introduce an entirely new cause of action but may, by amendment, separately state causes of action which under the provisions of the statute, can be united in the same petition. 9. -: -: -: Last Amended Petition Compared With Original. For the purpose of determining whether the last amended petition in this case is a departure, said last amended petition must he compared with the original petition, though no objection was raised to the first amended petition on the ground of departure.

Appeal from Webster Circuit Court. — Hon. Argus Cox, Judge. (1) The judgment under the plea in abatement should be reversed. Finley v. Bryson, 84 Mo. 664; Sandeen v. Railroad, 79 Mo. 278; Force v. Squier, 133 M'o. 306. (2) The second amended petition was a departure and stated a new cause of action. Drake v. Railroad, 35 Mo. App. 553; Lumpkins v.' Collier, 69 Mo. 170; Herman v. Gian, 129 Mo. 325; Scovill v. Glasner, 79 Mo. 449; Purdy v. Pfaff, 104 Mo. App. 331; Bick v. Vaughn, 120 S. W. 618; Lamar v. Drug Go., 118 Ga. 850; 45 S. E. 671; Scott v. Robards, 67 Mo. 289; Cook v. Putnam Co., 70 Mo. 668; Gas Light Co. v. Pratt, 7 Mo. App. 573; McConey v. Wallace, 22 Mo. App. 377; Peir v. Heinrichhoffen, 52 M'o. 668; Finley v. Bryson, 84 Mo. 664; Clark v. Transfer Co., 129 Mo. 225. (3) The plaintiff should elect between his causes of action. Sidway v. Live Stock Co., 163 Mo. 342; Arteberry v. Powell, 29 Mo. 429; Young v. Schoefield, 132 Mo. 650. (4) The petition does not precisely show whether plaintiff seeks to recover for breach of contract to convey land, or for money obtained by false representations, and should be made definite and certain. R. S. 1899, sec. 612; Sidney v. Live Stock Co., 163 Mo. 342; Attebury v. Powell, 29 Mo. 429. (5) The commencement of second amended petition in the first count contains matter of inducement which need not be repeated in the succeeding counts. But to read the matter following the twentieth count into any count, it should be embodied in the first count and intelligently referred to in the subsequent counts. Clark v. Whitaker Iron Co., 9 Mo. App. 446; Brockler v. Railroad, 10 Mo. App. 448; Cas Light Co. v. St. Louis, 86 Mo. 495; Webb y. Squier, 51 M'o. App. 601; Russell v. Railroad, 83 Mo. 507. (6) The plaintiff cannot recover on the second to twentieth counts inclusive, because if as claimed, said causes of action are founded on fraud and deceit practiced on plaintiff’s assignors, they are rights of action which cannot be assigned. Harrison v. Craven, 188 Mo. 590; 87 S. W. 962; Wilson v. Railroad, 120 Mo. 45; Smith v. Harris, 43 Mo. 557; Jones v. Babcock, 15 Mo. App. 149; 3 Pom. Eq. (2 Ed.), 1276; 2 Story Eq. (13 Ed.), 1040; Weissenfels v. Cable, 208 Mo. 515, 106 S. W. 1028. (7) The written contract pleaded has not been rescinded, and the plaintiff cannot waive it, and sue on an implied contract. Johnson v. Strader, 3 Mo. 359; Stollings v. Sappington, 8 Mo. 118; Christie v. Price, 7 Mo. 430. (8) If what follows the twentieth count contains the constitutive averments, and what precedes can be read into it, there is a misjoinder, and the plaintiff should be required to elect, or separately state. R. S. 1899', sec. 593; Henderson v. Dickey, 50 Mo. 161; Christal v. Craig, 80 Mo. 367; Scott v. Robards, 67 Mo. 289; Marsh v. Richards, 29 Mo. 99; Doan v. Halley, 25 Mo. 357; Childs v. Bank, 17 Mo. 213; Mooney v. Kennett, 19 Mo. 552; Waechter v. Railroad, 113 Mo. App. 270; 88 S. W. 147. (9) The assignment of the contract does not carry with it the right to sue for fraud in its procurement. 2 Story Eq. Jur. (3 Ed.), 899. (10) Plaintiff’s assignors are the real parties in interest, in all the counts except the first. Weissenfels v. Cable, 208 Mo. 515, 106 S. W. 1028. (1) The law will imply a promise to repay money had and received by a party, when it is not unjust and inequitable, to the party to whom the promise is thus imputed. Corrigan & Waters v. Brady, 38 Mo. App. 649; 3 Pomeroy’s Eq. Jur. (3 Ed.), sec. 1047; Kuntz v. Livingston, 15 Cal. 344; Deal V. Bank, 79 Mo. App. 262; Winningham v. Fancher, 52 Mo. App. 458; Cary v. Curtis, 3 How. (U. S.) 235; Clark v. Bank, 57 Mo. App. 277; Richardson v. Drug Co., 92 Mo. App. 515; Johnson v. Bank, 116 Mo. 568; Crigler v. Duncan, 121 Mo. App. 381; Clifford v. Donovan, 195 Mo. 262; Wilson v. Turner, 164 111. 398; Covey v. Webber, 96 Mich. 357; Hathaway v. Town of Cincinnatus, 62 N. Y. 434; 14 Ency. of PL and Pr., p. 53; Royce, Allen & Co. v. Oakes, 39 L. R. A. 845. (2) There was no new cause of action stated in either the second or third petition. Even if the first two petitions had not been for money had and received, such causes of action in third petition, or second amended petition, would be no departure. Harrison v. Murphy, 106 Mo. App. 465; Cohn v. Sanders, 175 Mo. 455; Land Co. v. Case, 104 M'o. 572; Ward v. Davidson, 89 Mo. 445; Pratt v. Walther, 42 Mo. App. 491. (3) Plaintiff should not have to elect between his causes of action. R. S. 1899, sec. 593; McHoney v. Insurance Co., 44 Mo. 426; Morrison v. Herrington, 120 Mo. 665; Ware v. Johnson, 55 Mo. 500; Burnside v. Wayman, 49 Mo. 356. (4) When, in a suit in equity, facts are stated under which the plaintiff would be entitled to some relief, a demurrer should not be sustained, but the court should proceed to hear and determine all matters cognizable under the facts pleaded. Morrow v. Morrow, 113 Mo. App. 444; Fisher v. Patton, 134 Mo. 32; Williams v. Gerber, 75 Mo'. App. 29; Tanner v. Railroad, 180 Mo. 1. (5) The test of the assignability of a cause of action seems to be as to whether it would survive to the executor or administrator. If it survives, then it is assignable; if not, it is not assignable. Snyder v. Railroad, 86 Mo. 613. Actions for tort survive. R. S. 1899, sec. 96; Snyder v. Railroad, 86 M'o. 613; Dean v. Chandler, 44 Mo. App. 338. (6) It has become axiomatic that where a party has obtained money which in equity and good conscience he ought not to retain, this action will lie. Clifford Banking Co. v. Donovan, Com. Co., 195 Mo. 288; Richardson v. Drug Co., 92 Mo. App. 515; Crigler v. Duncan, 121 Mo. App. 381; Dean v. Bank, 79 Mo. App. 262; Henderson v. Koenig, 192 Mo. 690. (7) Even if respondent’s assignors -were the real parties in interest, that fact would not prevent him from maintaining this action. The debtor is completely protected by the assignment, and cannot complain if he has to pay a claim to an assignee instead of the original obligee; and this is the law independent of section 540, Revised Statutes 1899. Guerney v. Moore, 131 Mo. 650; Long v. Heinrich, 46’ Mo. 603; Pomeroy, Rights and Remedies, sec. 132; Webb v. Morgan, 14 Mo'. 429; Haysler v. Dawson, 28 M'o. App. 531; Beattie v. Lett, 28 Mo. 598. Statement. — This suit was commenced in the circuit court of Howell county by filing a petition and an affidavit for attachment on the 30th day of November, 1907, a copy of which affidavit for attachment is as follows (caption omitted) : “This affiant, Guy C. Barr, being first duly sworn on his oath, states that he is attorney and authorized by the plaintiff in the above entitled cause, to make this affidavit for an attachment therein, that said plaintiff W. IT. Steele has a just demand against thé defendant herein. “That the amount which this affiant believes he ought to recover, after allowing all just credits and setoffs, is one thousand and forty dollars; and that this affiant has good reasons to believe and does believe. “That the defendant conceals himself so that the ordinary process of law cannot be served upon him. “That the defendant has absconded and absented himself from his nsual place of abode in the State of Missouri, so that the ordinary process of law cannot be served upon him. “That the defendant is about to remove his property and effects out of the State of Missouri, with the intent to change his domicile. “That the defendant has fraudulently conveyed and assigned his property and effects so as to hinder and delay his creditors. “That the defendant has fraudulently concealed, removed and disposed of his property and effects so as to hinder and delay his creditors. “That the defendant is about fraudulently to convey and assign his property and effects so as to hinder and delay his creditors. “That the defendant is “about fraudulently to conceal, remove and dispose of his property and effects so as to hinder and delay his creditors. “That the debt herein sued for was fraudulently contracted on the part of the debtor-the defendant —;- herein.” Afterward, on the 23d day of March, 1908, the defendant filed a counter-affidavit in the nature of a plea in abatement denying the grounds for attachment alleged in said affidavit, which is in words and figures as follows (caption omitted) : “Now comes the defendant, W. H. Brasier, and says that the plaintiff ought not to have and maintain the proceedings in attachment in this cause against him because the defendant says that the grounds for attachment set forth in the affidavit for attachment are untrue as follows: It is not true as alleged in the affidavit upon which attachment was issued: “That the defendant conceals himself so that the ordinary process of. law cannot be served upon him. “It is not true: ‘That the defendant has absconded and absented himself from his usual place of abode in the State of Missouri, so that the ordinary process of law cannot be served upon him.’ “It is not true: ‘That the defendant is about to remove his property and effects out of the State of Missouri with the intent to defraud, hinder and delay his creditors.’ “It is not true: ‘That the defendant has fraudulently conveyed and assigned his property and effects so as to hinder and delay his creditors.’ “It is not true: ‘That- the defendant has fraudulently concealed, removed or disposed of his property and effects so as to hinder and delay his creditors.’ “It is not true: ‘That the defendant is about fraudulently to convey and assign his property and effects so as to hinder and delay his creditors.’ “It is not true: ‘That the defendant is about fraudulently to conceal, remove or'dispose of his property and effects so as to hinder and delay his creditors.’ “It is not true: ‘That the damages for which this action is brought are for injuries arising from the commission of a felony by the defendant herein.’ “It is not true: ‘That the debt herein sued for was fraudulently contracted on the part of the debtor, the defendant herein.’ “Wherefore, the defendant asks that the attachment abate and be dissolved at the cost of the plaintiff and bondsmen.” On the 10th day of August, 1908, in the Howell Circuit Court, the plaintiff asked and obtained leave to file an amended petition, which was filed on said date. Plaintiff stated for his cause of action in this first amended petition that the defendant, with the intent to cheat and defraud the plaintiff and other parties therein mentioned, fraudulently represented that he was the owner in fee of ten thousand acres of valuable land in the counties of Howell, Ozark and Douglas, that several hundred acres of the land was well improved with valuable residences and barns, that there were many valuable springs and wells on the land, and that these representations were made as a part of a scheme to cheat and defraud the plaintiff and the other parties mentioned; that in order to carry out the said scheme, the defendant had literature circulated containing representations of the existence of valuable farms on this tract of land, and stating that each and every shareholder purchasing of him under said scheme would have conveyed to him in fee simple a portion of the said lands, being not less than two town lots and not more than one hundred and sixty acres; that plaintiff and others believed the said representations, were deceived thereby and were induced to purchase- twenty-nine shares at $40 each; that the other parties purchasing assigned their shareholders’ contracts to this plaintiff; that the defendant did not have the lands' such as he represented; that his representations as to such lands were false and fraudulent and misled the plaintiff and the other parties; that by reason of such fraudulent representations, he was damaged in the sum of $1,160 for which he asked judgment. On the 17th day of August, 1908, in the circuit court of Howell county, the plea in abatement coming on for trial, the plaintiff offered evidence tending to sustain the allegations of his petition, and the testimony of thee plaintiff, W. H. Steele, was heard. At the conclusion of the evidence offered by the plaintiff to sustain the attachment, the defendant offered no evidence, but filed a demurrer to the evidence and assigned the following grounds.: “First: That there is no substantial evidence to support the grounds alleged for the attachment; nor any one of such grounds. “Second: There is no substantial evidence that the plaintiff or any other of the alleged subscribers for shares in the Siloam Springs Colonization Company were misled and induced to subscribe for such shares, by any false and fraudulent representations by the defendant. “Third: The evidence on the part of the plaintiff shows that he and the other alleged subscribers were engaged, in a lottery scheme, which is contrary to public policy and the alleged shares purchased by them were intended to be uséd by them as mere evidence of a right to share in a lottery. “Fourth: There is no substantial evidence that any alleged representations of fact made by the defendant were false and known to be false by the defendant at the time of such subscriptions. “Fifth: The evidence on the part of the plaintiff shows that the inducement of the subscriptions aforesaid was the chance of drawing one of the capital prizes in a lottery.” This demurrer was overruled by the court and the defendant excepted. The issues on the plea in abatement were tried by the court without a jury, and the court found for the plaintiff on the last ground for attachment alleged in the affidavit — the fourteenth subdivision of the statute — that the debt for which the suit was brought was fraudulently contracted by the defendant. Judgment was rendered overruling the plea in abatement and sustaining the attachment as to said last-mentioned ground. The defendant filed a motion for a new trial and a motion in arrest, and these being overruled, the defendant below has perfected his appeal to this court on the judgment sustaining the attachment. Afterward, on August 25, 1'908, the defendant filed an affidavit for a change of venue which was approved by the court, and the cause was removed to the circuit court of Webster county. The same came on for trial on March 17, 1909, and plaintiff filed a second amended petition which is in substance as follows: Plaintiff alleged that the defendant was engaged in doing business under the name of the Siloam Springs Colonization Company, and that on or about the 24th day of February, 1906, in consideration of the sum of $80 paid him by the plaintiff, the defendant executed and delivered to the plaintiff two shareholders’ contracts for deeds, both of which are in words and figures as follows: “The Siloam Springs Colonization Company, Kansas City, Mo. “This certifies that W. H. Steele is the owner of one share of forty dollars each being one undivided one five-thousandth interest in ten thousand acres in Howell, Douglas and Ozark counties, Missouri, owned by the Siloam Springs Colonization Company. “The Siloam Springs Colonization Company hereby agrees to redeem and cancel this certificate by deeding ten thousand acres to the shareholders in tracts as they themselves may elect; the same, however, not to be in violation of the laws of the United States or Missouri. “In Witness Whereof, the said Company has caused this certificate to be signed by the general manager and to be sealed by the company seal at Kansas City, Missouri, this, the 24th day of February, A. D. 1906. “W. H. Brasier, General Manager.” For a second and further cause of action, plaintiff stated that on or about the-day of-, 1906 in consideration of the sum of one hundred and twenty dollars paid by W. J. Vannix, the defendant executed and delivered to the said W. J. Vannix a contract for a deed for three shares in the Siloam Springs Colonization Company, which contract is in words and figures the same as that executed and delivered to W. H. Steele, a copy of which is above set out; that on or about the -day of-, 1907, and before the commencement of this action, the said W. J. Vannix did, for a valuable consideration, transfer and assign all his interest in and to said contract to this plaintiff by an instrument in writing, signed and delivered by him to the plaintiff, a copy of which was attached to the petition. (The petition then sets forth eighteen other causes of action from the third to the twentieth inclusive, all exactly like the second except as to names of assignors, which are of different persons named, and as to the number of shares of each assignor.) After the twenty causes of action, the petition continues substantially as follows: That in order to induce the plaintiff and others mentioned to-enter into said contract, the defendant falsely and fraudulently represented that he had organized a company known as the Siloam Springs Colonization Company for the purpose of purchasing and selling a large tract of land containing ten thousand acres located in.Hbwell, Douglas and Ozark counties in the State of Missouri; that the company was owned and controlled by men of large financial means and capable of and competent to manage and finance a company to handle this tract of land, and that the company had a perfect and marketable title to the land; that the defendant prepared and circulated literature describing this tract of land, and represented that the tract was covered with heavy timber, worth from six to twenty-five dollars per acre, and that the land had been appraised at $750,000; that it had an artesian well of great value on it, and fifteen valuable iron mines containing great quantities of ore; together with other representations concerning said land; that the plaintiff and the others under whom he claims relied on said statements and was induced to pay to the defendant the sum of $1,240; that the defendant well knew these representations to be false and fraudulent, and were made to induce the plaintiff and others to purchase shareholders’ contracts for deeds; that the said sum of money was received by the defendant without any consideration, and that the defendant never carried out his contract with plaintiff or plaintiff’s assignors or any part thereof; and plaintiff asked for judgment for $1,240 for money had and received. On the 18th day of March, 1909, the defendant filed a motion to require the plaintiff to make his second amended petition more definite and certain, which was by the court overruled and exceptions saved. Afterward, the defendant filed a separate demurrer to each of the twenty counts, and assigned as grounds that each and all did not state facts sufficient to constitute a cause of action in favor of the plaintiff and against the defendant; that the plaintiff improperly united several causes of action; that the second amended petition states a new cause of action and is not a proper amendment, and changes substantially the original cause of action stated in his first petition. This demurrer was by the court overruled to which the defendant excepted, and the defendant failing to plead further and electing to stand on his demurrer, the following judgment was entered (caption omitted) : “. . . Whereupon the court doth find from said petition that defendant has obtained of and from plaintiff’s assignors the sum of twelve hundred and forty dollars ($1,240) by means of certain false and fraudulent statements and representations as stated in said petition; that the allegations in said petition are true; and that said sum of twelve hundred and forty dollars ($1,240) so obtained as aforesaid should be returned to the plaintiff. “Wherefore, it is considered, ordered, adjudged and decreed by the court that plaintiff recover of and from the defendant the said sum of twelve hundred and forty dollars ($1,240) together with his costs in this cause expended and that he have execution therefor. . . .” 'The defendant filed a motion for a- new trial and a motion in arrest of judgment, and these being overruled, in due form perfected his appeal from the judgment sustaining the attachment and from the judgment on the merits.