Collins ex rel. Collins v. Norfleet-Baggs, Inc., 197 N.C. 659 (1929)

Nov. 6, 1929 · Supreme Court of North Carolina

197 N.C. 659

ELBERT E. COLLINS by His General Guardian, ERNEST F. COLLINS, v. NORFLEET-BAGGS, Inc.

(Filed 6 November, 1929.)

1. Infants B c — Market value and not contract price of projierty traded may be recovered by infant upon his disaffirmance of contract.

Where in a contract for the purchase of an automobile an infant is allowed a certain sum for a truck traded in by him, upon disaffirmance of the contract by the infant during his minority and his suit, brought by his nest friend, to recover the consideration paid by him, the contract is binding upon neither party thereto, and he is entitled to recover such sums as he has paid on the purchase price and the reasonable market value of the truck at the time of the trade, and if the truck is returned to him, the market value at the time of the trade should be fixed by assessing a reasonable amount for depreciation and use, if any, while in the possession of the defendant, and an instruction that fixes the value of the truck at the amount allowed therefor in the contract is reversible error.

2. Infants B d — Liability of infant for tortious use or destruction of property received by him under contract he has disaffirmed.

Where an infant disaffirms his contract for the purchase of personal property during his minority he is not required by law to account for its use while in his possession or for its loss if squandered or destroyed by him before avoidance of the contract, but he is accountable for its tor-tious use or destruction after such avoidance and before its surrender.

Appeal by defendant from Moore, J., at February Term, 1929, of Foesyth.

Civil action to recover tbe value of a Chevrolet truck and tbe sum of $40.95.

On 21 April, 1928, tbe plaintiff, being a minor, entered into a contract witb tbe defendant, by tbe terms of wbicb be traded a. Chevrolet truck, valued at $250, for a Dodge sport roadster, valued at $859.50, and executed note and mortgage on tbe Dodge roadster for tbe balance of $409.50. On 21 May, 1928, tbe plaintiff made a. payment of $40.95 on bis note.

Thereafter tbe Dodge sport roadster was destroyed in a wreck; whereupon, tbe plaintiff elected to disaffirm bis contract, and now sues to recover $290.95, being tbe sum of tbe value placed upon tbe Chevrolet truck at tbe time of tbe trade, to wit, $250, and tbe payment of $40.95, subsequently made on tbe note.

Tbe trial court instructed tbe jury that if tbe plaintiff was a minor at tbe time of tbe trade, he would be entitled to recover $290.95, witb interest from 22 September, 1928. Exception by defendant.

Tbe jury found that tbe plaintiff was a minor, and answered tbe issue of indebtedness in accordance witb tbe above instruction.

From the judgment entered tliereon tbe defendant appeals, assigning errors.

Geo. B. Holton and W. Beodo Johnson for plaintiff.

Ratcliff, Hudson & Ferrell for defendant.

Stacy, C. J.

When an infant elects to disaffirm a contract, relative to the sale or purchase of personal property, other than one authorized by statute or for necessaries, what are the rights of the parties ?

1. An infant may avoid such a contract, either during his minority or upon arrival at full age. Pippen v. Insurance Co., 130 N. C., 23, 40 S. E., 822.

2. Upon such avoidance, the infant may recover the consideration paid by him, either in money or property, with the limitation that he must restore whatever part of that which came to him under the contract he still has, or account for so much of its value as may have been invested in other property which he has in hand or owns and controls. Hight v. Harris, 188 N. C., 328, 124 S. E., 623; Millsaps v. Estes, 137 N. C., 536, 50 S. E., 227, 14 R. C. L., 238.

3. But the infant is not required to account for the use or depreciation of the property while in his possession, or for its loss, if squandered or destroyed, for this is the very improvidence against which the law seeks to protect him (Utterstorm v. Kidder, 124 Me., 10, 124 Atl., 725), with the exception, perhaps, that he might be required to account for any insurance money received by him, on the theory that such money was a substitute for the property destroyed. Morris Plan Co. v. Palmer, 185 N. C., 109, 116 S. E., 261; Devries v. Summit, 86 N. C., 132.

4. The infant, however, would be liable for any tortious use or disposition of the property after such avoidance and before its surrender to those from whom it was obtained. Devries v. Summit, supra.

5. Where the infant parts with personal property he may, upon dis-affirmance, recover the value of such property, as of the date of the contract, but he is neither bound by, nor entitled to be awarded, the price fixed by the contract, for its real value may be more or less than the amount so stipulated. Carpenter v. Grow, 247 Mass., 133; Beickler v. Guenther, 121 Iowa, 419. Neither side is bound by any part of the contract, when once rescinded. Morris Plan Co., v. Palmer, supra.

In the instant case the plaintiff is entitled to recover the $40.95 which he paid on his note, together with the fair market value of the Chevrolet truck at the time of the trade. But he is not entitled, as a matter of law, to the sum of $250, the stipulated exchange value of said truck. In so instructing the jury, the trial court committed error. Its market value may be more or less than its stipulated exchange value.

If tbe Chevrolet truck is to be returned to tbe plaintiff, tbe jury will fix its value, as of tbe date of tbe contract, by assessing a reasonable amount for depreciation and use,, if any, while in tbe possession of tbe defendant.

' For tbe error, as indicated, in tbe court’s instruction on tbe measure of damages, a new trial must be awarded; and it is so ordered.

New trial.