Crawford v. Nastos

• Decision Date: 14 July 1960
• Citation: 182 Cal.App.2d 659,6 Cal.Rptr. 425
• Court: California Court of Appeals Court of Appeals
• Parties: , 97 A.L.R.2d 840 Leemoria B. CRAWFORD, Plaintiff-Respondent-Appellant, v. Asemo NASTOS et al., Defendants and Respondents. Floyd C. Rankin, Defendant-Appellant-Respondent. Leemoria B. CRAWFORD, Plaintiff and Appellant, v. Asemo NASTOS et al., Defendants. Asemo Nastos, Jim Nastos and Louis Nastos, Jr., Respondents. Civ. 24275.

Page 425

6 Cal.Rptr. 425

182 Cal.App.2d 659, 97 A.L.R.2d 840

Leemoria B. CRAWFORD, Plaintiff-Respondent-Appellant, v. Asemo NASTOS et al., Defendants and Respondents.

Floyd C. Rankin, Defendant-Appellant-Respondent.

Leemoria B. CRAWFORD, Plaintiff and Appellant, v. Asemo NASTOS et al., Defendants.

Asemo Nastos, Jim Nastos and Louis Nastos, Jr., Respondents.

Civ. 24275.

District Court of Appeal, Second District, Division 1, California.

July 14, 1960.

Monta W. Shirley, Los Angeles, for plaintiff, appellant and respondent Leemoria B. Crawford.

David Hoffman, Los Angeles, for defendant, appellant and respondent Floyd C. Rankin.

Schwabacher, Cosgrove & Beaudet, Philip M. Schwabacher, Lancaster, for defendants and respondents Nastos.

LILLIE, Justice.

Cross-appeals are here presented from a judgment for damages for fraud in the sale to plaintiff of real property near Lancaster. The action was brought against the owner (defendant Asemo Nastos), the latter's two sons (Jim and Louis Nastos), the real estate broker (defendant Rankin) and one Terkleson who was employed by Rankin. Judgment was rendered against Rankin alone for $1,419.73, plus interest, which sum represented the money spent by plaintiff (after she took possession) to put into operation a water well on the premises. In addition to the appeal by Rankin, plaintiff has cross-appealed, claiming that the judgment should have been for an additional $8,000 and against all the defendants except Terkleson.

Rankin's principal contention goes to the sufficiency of the evidence to sustain the finding of fraud; in this connection, his 'Summary Statement of Facts' has been of little assistance to this court, being devoid of any appropriate reference to the record which would support his assertions with respect to the somewhat detailed narrative of events therein set forth; nor is the brief of Crawford, as respondent and cross-appellant, wholly free from criticism, since it is confined to arguments supporting her cross-appeal and fails to answer (except by indirection) any of the arguments presented by her adversaries.

The subject real property was a 50-acre ranch in the Antelope Valley. The complaint alleged that the defendants Nastos listed said land and the improvements thereon for sale with Rankin, and the latter and his salesman (Terkleson) undertook to sell the said property; that at the inception of negotiations between plaintiff and defendants, plaintiff informed each of the defendants that she would not be interested in the property under any conditions unless the same contained an ample water supply. According to the complaint, the defendants fraudulently represented to the plaintiff, both orally and in writing, that the premises had sufficient water supply for the entire acreage (at least 60 miner's inches) which was ample for irrigation and for domestic purposes on an annual basis; it was further alleged that plaintiff was wholly unfamiliar with conditions in and about the area and that she relied wholly and completely upon the representations thus made to her when she undertook the purchase of the property for the total price of $28,000. Each and all of the representations, it was then alleged, was and were false, were known by the defendants to be false, and were made for the express purpose of inducing plaintiff to enter into the contract of purchase; specifically, said land did not contain an ample supply of water and the water well thereon was not able to supply water to the property year around or for any period of time at all, and said well did not supply 60 miner's inches. The complaint concluded with an itemization of the damages assertedly sustained, including a claim for exemplary damages on the basis of a malicious intent to injure the plaintiff.

The court found that Rankin, admittedly a real estate broker, had employed Terkleson as his salesman during the period in question; that Rankin was the agent of, and represented, the defendants Asemo Nastos (as owner) and Louis Nastos (as her agent) in negotiating the sale of the property; that Louis Nastos listed the property with Rankin who thereupon undertook to sell the land and improvements and caused the plaintiff to be contacted (as a prospective purchaser); and that at the inception of negotiations between plaintiff and Terkleson, plaintiff stated that she would not be interested in the property unless it contained an ample supply of water for domestic and irrigation purposes, for permanent pasture and summer growth, as well as winter crops. The court further found that Rankin, to induce the sale, fraudulently declared to plaintiff (orally and in writing) that there was developed on said premises a water well which supplied sufficient water for the entire acreage, both for domestic purposes and for farming and pasture needs desired by plaintiff, and that said well would produce and did produce at least 60 miner's inches of water; there was a finding, however, that the defendants Nastos did not participate in said representations and did not misrepresent the actual water supply from said well. The court also found that plaintiff at all times in question was unfamiliar with conditions in and about the area and that she relied wholly and completely upon the representations respecting the property which were made to her; that said representations were made by Rankin to induce plaintiff to purchase the land in question from defendant Asemo Nastos, and that as a result she agreed to and did purchase the said property for the sum of $28,000; and that there was not already developed on the said land a water well which supplied sufficient water for the entire acreage to fulfill the various purposes desired by plaintiff, and that said well did not at any time material to the instant controversy produce 60 miner's inches of water. Found to be untrue was the claim that Rankin at all times during the negotiations in question advised plaintiff that he (Rankin) could not, and would not, warrant or guarantee anything in connection 'with the well and/or water conditions'; in this connection there was a further finding that Rankin did suggest an inspection of the well, but 'procured a partial and incomplete inspection himself' showing a production of only 51 1/3 miner's inches, the results of which inspection were never reported to the plaintiff, and plaintiff never received a report on the condition of 'said well and water supply prior to entering into the escrow agreement to purchase said property.'

With respect to the defendants Nastos, the court found that there was inserted in the escrow instructions, pursuant to the advice of their attorney, the statement 'Buyer has inspected well and accepts same as is'; the court also found that said instructions were approved and signed by the plaintiff although she received no legal advice as to the legal effect of the language just quoted and although she understood that 'said comment was referring to the condition of the well as seen by her, and that said well was and would be as represented'; too, 'such phrase was accepted by plaintiff by reason of the false and fraudulent representations made to her, as aforesaid, and not otherwise.' Finally, the court found that 'neither of defendants, Jim Nastos or Louis Nastos, Jr., was a party to the transaction herein as seller, and neither of them received anything of value from said sale; neither of defendants, Asemo Nastos, Jim Nastos or Louis Nastos, Jr., actively participated in the fraudulent representations, and are not, nor is either, liable to plaintiff herein.'

We first dispose of Rankin's appeal which is predicated principally on the claim that the evidence was insufficient to support the finding of fraud. 'The essence,' he says, 'of the lower court's finding with reference to appellant's alleged fraud, was that he (Rankin) represented that there was already developed on the ranch a water well which supplied sufficient water for the entire acreage and that it would produce and did produce at least 60 miner's inches of water, and that this representation was false.' The written offer to purchase the property, in the form of a 'Deposit Receipt' prepared by Terkleson, included the following language: 'Buyer to be privileged and have current report on production of water well--having been assured of adequate supply. Must have at least 60 inches (miner's). Appellant argues that the concurrence of the vendor, his principal, was necessary to bind anyone to the requirement of 60 miner's inches and 'if the seller did not accept the conditions set forth in the offer certainly the real estate broker could not be held.' This rather novel contention overlooks the settled rule that every person connected with a fraud is liable for the full amount of damages (Swasey v. L'Etanche, 17 Cal.App.2d 713, 718, 62 P.2d 753) and the wrongdoers (if any) are jointly and severally liable (Ross v. George Pepperdine Foundation, 174 Cal.App.2d 135, 141-142, 344 P.2d 368); furthermore, the trial court found, supported by substantial evidence, that Rankin was personally guilty of overt acts constituting actionable fraud (Barnes v. Persson, 131 Cal.App.2d 515, 280 P.2d 821). Nevertheless, it is claimed that the statement or declaration in the escrow instructions, namely, 'Buyer has inspected well and accepts same as is' served to relieve appellant (as well as his principal) of any liability in the premises, citing Newmark v. H and H products Mfg. Co., 128 Cal.App.2d 35, 274 P.2d 702. It was there held that the trial court properly sustained plaintiff's objection to the introduction of parol evidence which had for its purpose the establishment of representations inconsistent with the express terms of the written contract the parties had entered into (Simmons v. California Institute of Technology, 34 Cal.2d 264, 274, 209 P.2d 581). In the Simmons case, it was pointed out that there is a distinction between an antecedent promise...