Alpha Kappa Psi Bldg. Corp. v. Kennedy, 35194

• Decision Date: 07 July 1954
• Docket Number: No. 35194,No. 2,35194,2
• Parties: ALPHA KAPPA PSI BUILDING CORP. v. KENNEDY
• Court: Georgia Court of Appeals

Page 580

83 S.E.2d 580

90 Ga.App. 587

ALPHA KAPPA PSI BUILDING CORP. v. KENNEDY.

No. 35194.

Court of Appeals of Georgia, Division No. 2.

July 7, 1954.

Rehearing Denied July 27, 1954.

Syllabus by the Court.

1. Where, as here, a contract contains a provision that 'No representation, promise, or inducement not included in this contract shall be binding on any party hereto,' and there is nothing in the evidence to indicate that the plaintiff was induced to sign the contract by reason of any fraud, accident, or mistake which precluded him from knowing the terms thereof, such provision constitutes an agreement not to rely upon representations, and shows that the buyer entered into the contract as a result of his own knowledge and investigation and did not rely upon the representations of the opposite party. One of the essential elements of an action in tort for damages for fraud in procuring the contract being that the party defrauded relied upon the representations of the opposite party and was thereby deceived, a purchaser who relies upon his own investigation rather that the representations of the other party is not deceived by such representations, and is therefore precluded from setting up fraud in procuring the contract through such misrepresentations. It follows, therefore, that where, as here, the proposed vendee is precluded by a provision in the contract of purchase from relying upon misrepresentations made by the proposed vendor or his agent, such proposed vendee is conclusively presumed to have relied on his own investigation before executing the contract. The evidence here demanded a finding in favor of the defendant, and the trial court did not err in directing the verdict.

2. Special grounds of the amended motion for new trial complaining of the admission of evidence, which evidence, in any event, would have no bearing upon the outcome of the case, are not passed upon, since any error alleged therein would be harmless to the movant.

Alpha Kappa Psi Building Corporation filed an action in the Civil Court of Fulton County against F. R. Kennedy, a real estate broker, seeking damages for fraud in the procurement of a contract of sale of real estate. The petition alleges in substance: that the defendant, acting as agent of the vendor, H. L. Richardson showed the property involved to representatives of the plaintiff; that the defendant knew the plaintiff needed for fraternal purposes a private lake large enough to accommodate a large number of members and guests; that the defendant induced the plaintiff to enter into the contract of sale by making the following fraudulent misrepresentations which he in fact knew to be untrue: that the lake was at least 10 acres, when in fact it was only 7 1/2 acres; that only about one-eighth of an acre of the lake was on the lands of another person, when in fact one-fourth of its total surface was on such other lands; that the depth of the lake at the boundary line was not over two feet, so that, by lowering the lake two feet, all of it would be within the tract to be purchased, when in fact the depth at such boundary line was between 11 and 12 feet; that the boundary line across the headwaters of the lake was misrepresented to be a line about 400 feet south of the actual line, the location of which he well knew, so that the plaintiff was misled into believing only a small swampy area was over the line, whereas in fact the line crossed the main body of the lake and not just the headwaters (the effect of all of which was to prevent the plaintiff from making the lake into a private lake as it desired); that these knowing and wilful misrepresentations of fact induced the plaintiff to enter into a contract of sale with the vendor and to pay to the defendant $1,000 as earnest money on the purchase of the 79-acre tract in question; that thereafter the plaintiff communicated these knowingly false representations to the vendor (prior to the consummation of the transaction), and said vendor repudiated the acts of his agent, the defendant, and repudiated the contract, and directed the defendant to refund to the petitioner its $1,000, which, however, the defendant has refused to do.

Upon the trial of the case the court directed a verdict in favor of the defendant. The plaintiff made a motion for new trial on the general grounds, which was later amended by adding four special grounds, and the denial of this motion is assigned as error.

L. Cecil Turner, Jess H. Watson, Atlanta, for plaintiff in error.

Robert P. McLarty, Eugene R. Simons, Merrill H. Collier, Atlanta, for defendant in error.

TOWNSEND, Judge.

On the trial of the case, a contract of sale signed by the vendor and vendee was introduced in evidence, which contract contained a legal description of the land in question without any mention of the size, boundaries, or location of any lake, the quantity of land being stated as 79 acres, and which recited the payment of $1,000 earnest money. The following provisions were contained therein: 'The real-estate broker negotiating this contract is made a party to this contract to enable broker to enforce his commission rights hereunder against the parties hereto on the following basis: If sale is not consummated because of seller's inability, failure or refusal to convey marketable...