The question whether fraud has been waived, or whether there has been an unreasonable delay in discovering or complaining thereof, is a question of fact for the jury unless the evidence is so clear as to permit of only one reasonable conclusion. Walter v. Laidlaw, 249 N.Y. 46, 51, 162 N.E. 580; Sacramento Suburban Fruit Lands Co. v. Schreindl, 9 Cir., 36 F.2d 932; International Harvester Co. of America v. Rieke, 8 Cir., 9 F.2d 776, 781; 27 C.J. 77; 37 C.J.S., Fraud, § 131, p. 456. The question of waiver of the fraud should have been left to the jury.
The authorities are unanimous in holding that where one has been induced by fraud to enter into a contract and, after discovery of the fraud, enters into an agreement concerning the subject matter of the contract, or demands and receives from the other party any substantial concession in respect to the transaction, he is conclusively deemed to have waived any claim for damages on account of fraud. Josten Mfg. Co. v. Medical Arts Bldg. Co., 8 Cir., 73 F.2d 259; International Harvester Co. v. Rieke, 8 Cir., 9 F.2d 776; Schagun v. Scott Mfg. Co., 8 Cir., 162 F. 209; State ex rel. Cary v. Trimble, Mo.Sup., 43 S.W.2d 1050; Holcomb H. Mfg. Co. v. Jones, 102 Okla. 175, 228 P. 968; Minneapolis-Moline Co. v. Gatzki, Tex.Civ.App., 57 S.W.2d 593; Thompson v. Pitts, Tex.Civ.App., 2 S.W.2d 899. The rule has been held to apply although the party claiming the fraud remains silent concerning it in the negotiations in which the amendment to the contract or a concession in his favor is secured. 24 Am.Jur. 214. And in some jurisdictions it is held that a right of action for damages for deceit is waived by a party to an executory contract who continues performance after discovery of the fraud which induced its execution.
It has been affirmed by this court in many cases. Burnes v. Burnes, 137 F. 781; Burk v. Johnson, 146 F. 209; McDonald v. Kansas City Bolt Nut Co., 149 F. 360, 363; Richardson v. Lowe, 149 F. 625, 628; International Harvester Co. of America v. Rieke, 9 F.2d 776, 781; Albert Lea Foundry Co. v. Iowa Sav. Bank, 21 F.2d 515, 520. The defendant, by the acceptance and retention of possession, with knowledge that the promise relied upon had not been performed, manifested its election to accept the performance tendered, and it thereby lost its right to rescind, or to refuse to comply with the terms of the lease.
Fitch was a mere soliciting agent, barren of all authority to do more than solicit the advertising contract. With knowledge of Fitch's total lack of authority, defendants cannot be heard to say that they relied upon the oral representations, promises, and agreements alleged to have been made by him. New York Life Ins. Co. v. McCreary (C.C.A. 8) 60 F.2d 355; Jensen v. New York Life Ins. Co. (C.C.A. 8) 59 F.2d 957; Inter-Southern Life Ins. Co. v. McElroy (C.C.A. 8) 38 F.2d 557; International Harvester Co. v. Rieke (C.C.A. 8) 9 F.2d 776, 779; Eastern Advertising Co. v. E.L. Patch Co., 235 Mass. 580, 127 N.E. 516, 517; Colonial Development Co. v. Bragdon, 219 Mass. 170, 106 N.E. 633; Kaley v. Northwestern Mutual Life Ins. Co., 102 Neb. 135, 166 N.W. 256; Omaha Alfalfa Milling Co. v. Pinkham, 105 Neb. 20, 178 N.W. 910; Schuster v. North American Hotel Co., 106 Neb. 672, 184 N.W. 136, 186 N.W. 87; New Prague Flouring Mill Co. v. Hewett Grain Prov. Co., 226 Mich. 35, 196 N.W. 890; Pease v. Fitzgerald, 31 Cal.App. 727, 161 P. 506; Canon City Industrial Stores Co. v. McInerney, 71 Colo. 492, 208 P. 457; Tockstein v. Pacific Kissel Kar Branch, 33 Cal.App. 262, 164 P. 906; Gridley v. Tilson, 202 Cal. 748, 262 P. 322; International Text-Book Co. v. Lewis, 130 Mo. App. 158, 108 S.W. 1118; Murphy v. Holliway, 223 Mo. App. 714, 16 S.W.2d 107. Accepting the contention of defendants that the representations and statements made by Fitch were fraudulent and false, yet they were made by one who had no authority to make any statements o
The acceptance of benefits following the delay would seem to preclude him from the equitable remedy which he seeks. Texas Co. v. Rosenthal-Brown Fur Co., Inc., D.C. 1925, 12 F.2d 297; Id., 5 Cir., 16 F.2d 1022, certiorari denied 274 U.S. 746, 47 S.Ct. 658, 71 L.Ed. 1327; International Harvester Co. of America v. Rieke, 8 Cir., 9 F.2d 776; Miller v. Continental Shipbuilding Corporation, 2 Cir., 265 F. 158; Grymes v. Sanders, 93 U.S. 55; First National Bank v. Seldomridge, 8 Cir., 271 F. 561. Moreover, as was said in a recently decided case, Equitable Life Assurance Society v. Aaron, 6 Cir., 108 F.2d 777, 778: 'It is the general rule that, to authorize the reformation of written instruments, the decree must be supported by more than a mere preponderance of the evidence.
Appellants argue further from the application's capital letters that plaintiff was "specifically advised of the limits of authority" of the General Motors agents, and that a corporation is not bound by the acts of agents "within some apparent scope of authority, when the person dealing knows that the corporate agent has no such authority." International Harvester Co. of America v. Rieke, 8 Cir., 9 F.2d 776; Knoche v. Pratt, Mo.App., 187 S.W. 578; Wyler Watch Agency v. Hooker, Mo. App., 280 S.W.2d 849; Seibel v. Harry S. Surkamp Inv. Co., Mo.App., 328 S.W.2d 179; Curtiss Candy Co. v. National Finance Corp., 228 Mo.App. 609, 71 S.W.2d 833; Distassio v. American United Life Ins. Co., 238 Mo.App. 279, 179 S.W. 610; Werner v. Welsh Co., Mo.App., 247 S.W.2d 311, and Trice v. Lancaster, Mo.App., 270 S.W.2d 519, cited by appellants, involve actual, implied, or apparent authority of agents in making contracts. They are not in point because plaintiff's theory is that of liability of agent and principal for wrongful or tortious acts while the agent was acting within the general course and scope of his conceded employment and agency.
The same rule with respect to waiver has been followed even where the person defrauded had proceeded in part to execute the contract before discovery of the fraud. Fitzpatrick v. Flannagan, 106 U.S. 648, 660, 1 S.Ct. 369, 27 L.Ed. 211; International Harvester Co. of America v. Rieke, 8 Cir., 9 F.2d 776, 780; Simon v. Goodyear Metallic Rubber Shoe Co., 6 Cir., 105 F. 573, 579, 52 L.R.A. 745; Kingman Co. v. Stoddard, 7 Cir., 85 F. 740; Van Scherpe v. Ulberg, 232 Mich. 699, 206 N.W. 323, 324; Ponder v. Altura Farms Co., 57 Colo. 519, 143 P. 570, 572; Thompson v. Libby, 36 Minn. 287, 31 N.W. 52; 24 Am.Jur., "Fraud and Deceit," § 216; 12 R.C.L., "Fraud and Deceit," § 159. 24 Am.Jur., "Fraud and Deceit," § 216.
It contains the following sentence: "We each have inspected each other's property and are dealing solely on our own judgment and not upon any representations that have been made to us, and have carefully read this contract before signing." It was upon the language above quoted that the trial court relied in sustaining the defendant's demurrer to the amended complaint. Counsel for the plaintiff on this review say that the trial court's decision was based largely upon Emerson-Brantingham Co. v. Wood, 63 Colo. 130, 165 Pac. 263, cited with approval in International Harvester Co. v. Rieke, 9 F.2d 776, 781. If so, the trial court acted wisely, for that decision is clearly authority for this judgment here complained of. The Emerson-Brantingham action was equitable in its nature, and was to rescind, on the ground of fraud in its procurement, a contract of sale of machinery. It seems that the trial court submitted the question of fraud as well as damages to the jury, which found for the plaintiff, and judgment went accordingly. In the opinion by Mr. Justice Scott upon review, he stated that just how the court could have rendered the money judgment for damages, without a finding as to fraud, and the prerequisite order for rescission of the contract, is not suggested by counsel for either party.