ARK.] BARKER V. LACK. 323 BARKER V. LACK. Opinion delivered October 18, 1915'. CONTRACTS— PABOL EVIDENCE TO VARY — DECEIT. — PaT01 evidence is inadmis• sible to vary, qualify, or contradict, to add to or to subtract from, the absolute terms of a valid written contract containing no ambiguity, but an action of deceit based on fraud in the procurement of a contract, not being an action to enforce the contract, parol evidence of the fraud is admissible, notwithstanding the fact that the contract is in writing. Appeal from , Clay Chancery Court, Eastern District ; Charles D. Frierson, Chancellor; affirmed. R. H. Dudley, for appellant. 1. The court had jurisdiction. 12 L. R. A. 780; 6 Porn. Eq. Jur. § 750; lb. § 50 ; Bisph. Eq. § 370; 46 N. J. Eq. 477. 2. The defense of fraud is not sustained by the evidence. The representations were not false and fraudulent within the rule. 74 Ark. 53 ; 73 Id. 542; 95 Id. 136; 101 Id. 608; 47 Id. 148; 113 Id. 78; 2 Porn. Eq. 879, 876. 3. Parol evidence is not admissible to contradict, or vary the terms of a written contract. 3 Jones on Ev. 434; 12 Mete. 275; 113 Ark. 509; 94 Id. 130 ; 35 Id. 156; 50 Id. 393; 105 Id. 50; 95 Id. 131 ; 46 N. J. Eq. 477; 102 Ark. 575; 104 Id. 475. 4. Appellee did not offer to do equity. 46 N. J. Eq. 477. The findings of the chancellor are against the pre-ponderence of the evidence. 102 Ark. 383 ; 102 Id. 658; 92 Id. 359 ; 77 Id. 216; 84 Id. 349 ; 104 Id. 475; 98 Id. 459; 71 Id. 614; 75 Id. 75. Ira C. Langley and R. E. L. Johnson, for appellee. 1. The findings of the Chancellor that the misrepresentations were false and fraudulent and that appellee relied upon them are sustained by the evidence. 2 Pom. Eq. p. 876. Appellee acted in good faith and good conscience throughout the whole transaction. 76 Ark. 46. 2. Parol proof is admissible in actions for deceit on account of fraudulent misrepresentations, or in equity
324 BARKER V. LACK. [120 to rescind for same. 95 Ark. 131; 38 Id. 334; 20 Cyc. 112 ; 71 Ark. 305. 3. The findings of the chancellor will be sustained unless clearly against :the preponderance of the evidence. 103 Ark. 473; 101 Id. 368; 4 Crawford's Digest 151, 152. HART, J. J. C. Barker instituted this action in the chancery court against R. A. Lack to obtain specific performance of a contract for the sale of a stock of goods. The complaint alleged in substance that the plaintiff had entered into a written contract with the defendant for the sale of a stock of goods and that the defendant as part payment therefor had agreed to sell to the plaintiff ninety-eight shares of stock in a mercantile corporation; that the defendant had been placed in possession of the stock of goods sold to him and had later abandoned possession of it; and that he had failed •to perform the contract on his part. The prayer of the complaint was for specific performance of the contract and for the appointment of a receiver to take charge of the stock of goods abandoned by the defendant and for an injunction restraining the defendant from disposing of the stock in the mercantile corporation. The defendant admitted the execution of the contract land as a defense to the action set up false representations in the procurement of the contract. The chancellor found the issue in favor of the defendant and the plaintiff has appealed. Both the defendant and his son testified in the ease. They testified that the plaintiff represented to the defendant as an inducement to get him to purchase the stock of goods that the goods would not invoice more than five thousand dollars and that the indebtedness would not be more than fifteen hundred dollars or two thousand 'dollars; that the defendant, believing these representations to be true, entered into the contract for the purchase of the stock of goods and agreed to pay therefor the wholesale invoice price and the cost of the fixtures, less $75 ; that in payment of the purchase price the buyer assumed the indebtedness of the seller and also agreed to
ARK.] BARKER V. LACK. 325 sell to him ninety-eight shares of stock in a mercantile company of the par value of $25 each; that the contract further provided that whatever differences there might be in the settlement should be settledby the party found tobe indebted giving his promissory note to the other payable twelve months after date; that the stock in the mercantile company was worth $2000; that the stock of goods inventoried something over $7000 and that the indebtedness amounted to a little more than $3900 ; that the plaintiff refused to deliver the invoices (to the defendant but admitted that the invoices, as far as made, amounted to more than $7000 und the indebtedness to a little more than $3900 ; that at the request of the plaintiff they took possession of the stock of goods and began to sell the same as soon as the contract of sale had been executed ; that the defendant remained in possession of the stock of goods for eight or ten days selling the same in the usual course of business ; that when he learned that the representations made by the plaintiff were false he offered to return the stock of goods to the plaintiff and the amount of money he had received for cash sales and agreed to account to the plaintiff for the credit sales ; that demand was made of the plaintiff during the progress of making the inventory for the original invoices and that the plaintiff refused to deliver them to him. Other testimony was introduced by the defendant which tended in some measure to corroborate his testimony and that of his son. The plaintiff testified in his own behalf and flatly contradicted the defendant. He testified that he only gave his opinion to the defendant as to the amount the goods would inventory and as to the amount of the indebtedness, and that the defendant so understood it ; that he made the representations in good faith and that the contract embodied the whole agreement between the parties, and that it was not understood by the defendant that the plaintiff had made the representations to the defendant as to the amount that the goods would inven-
326 [120 tory or as to the amount of indebtedness as matters of inducement to the defendant to purchase the stook of goods. The testimony of the plaintiff was corroborated to some extent by that of other witnesses. The chancellor found the issues as to the false representations in behalf of the defendant and we cannot say that his finding is against the preponderance of the evidence. It is the settled rule of this court that findings of fact made by a chancellor will not be disturbed on appeal unless they are against the clear preponderance of the evidence. It is contended, however, by counsel for the plaintiff that the written contract expresses the agreement between the parties and that parol evidence is inadmissible to vary, qualify or contradict, to add to or subtract from, the absolute terms of a valid written contract . containing no ambiguity. Though this is the settled rule in this State, there are certain limitations to the rule and one is that an action of deceit based on fraud in the procurement of a contract, not being an action to enforce 'the contract, parol evidence of the fraud is admissible, notwithstanding the fact that the contract is in writing. 20 Cyc. 112. In the case of Hanger et al. v. Evins & Shins, 38 Ark. 334, the court held that an intentionally false and misleading representation which induced the contract to the other's injury is a tort outside of the-contract and is provable by parol. To the same effect see Delaney v. Jackson, 95 Ark. 131. It follows that the decree must he affirmed.
You are being directed to the most recent version of the statute which may not be the version considered at the time of the judgment.