Crowder v. Yovovich

• Decision Date: 10 April 1917
• Parties: CROWDER v. YOVOVICH.
• Court: Oregon Supreme Court

164 P. 576

84 Or. 41

CROWDER v. YOVOVICH.

Supreme Court of Oregon

April 10, 1917

Department 2.

Appeal from Circuit Court, Multnomah County; C. U. Gantenbein Judge.

Action by Bertha M. Crowder against Yanko Y. Yovovich. Judgment for plaintiff, and defendant appeals. Reversed and remanded for proceeding not inconsistent with the opinion.

This is a suit to recover damages for deceit in the sale of lands. The complaint alleges that on June 17, 1914, plaintiff owned certain furniture, including bedroom suites, chairs, etc situated in a rooming house in the city of Portland, and that defendant was the owner of a certain 40-acre tract of land situated in Lane county, Or.; that at said date defendant by reason of false representations as to the character and capabilities of the land, all of which are particularly set forth in the complaint, induced plaintiff to purchase the same and to give in exchange therefor the personal property described in the complaint, and to execute to defendant a note for $295, secured by a mortgage upon the land conveyed that the land was practically worthless, and that upon discovery of his fraudulent representations she tendered back to him a warranty deed to the same, and demanded a restoration of the property conveyed to him, but defendant refused to accept such conveyance or to restore said property; that by reason of defendant's fraudulent conduct she has been damaged in the sum of $2,500. The defendant answered, denying the alleged fraudulent representations, and asserting the property transferred to him was not worth to exceed $400 over and above an indebtedness of $295 due thereon. The answer denied plaintiff's ownership of the personal property assigned to him, and alleged that he conveyed the land to one J. A Barnes, and that the furniture and fixtures were in the name of J. A. Barnes. On the trial the plaintiff testified that she was the actual owner of the property; that it was held in the name of J. A. Barnes; that she had several conversations with defendant during the negotiations; that she did not remember telling him that Barnes was the owner of the furniture; that she was trying to keep her name out of it that all the money invested in the lodging house and furniture was hers absolutely; and that Barnes had never contributed a cent toward its purchase. Barnes testified to the same effect--that Mrs. Crowder purchased the property from Nellie Stacey with her own money, that the bill of sale was made to him at plaintiff's request, and that he held it as trustee for her. De Forest testified that it was listed for sale in his office by Barnes, but that he had always supposed until the bill of sale to defendant was made out that plaintiff was the real owner of the property. The bill of sale of the furniture, etc., was executed by Barnes, and to it was attached the following affidavit:

"State of Oregon, County of Multnomah--ss.: I, J. A. Barnes, being first duly sworn on oath, depose and say that I am the sole and lawful owner of the goods mentioned in the within bill of sale, and that same are free from all incumbrances except the sum of $295 due Edwards Company of the city of Portland, Oregon, as set forth within the bill of sale. J. A. Barnes.

"Subscribed and sworn to before me this 18th day of June, 1914. Carl J. Wangerien, Notary Public for Oregon."

At the same time and as a part of the same transaction defendant executed and delivered to Barnes, as grantee, a warranty deed to the land described in the complaint, and Barnes executed a promissory note in favor of defendant for the sum of $295, with interest at 7 per cent. per annum, payable three years after date, and also executed and delivered a mortgage upon the land to secure the same. Prior to the commencement of this action he executed a conveyance of the land to plaintiff. Upon the trial there was a verdict and judgment for plaintiff for the sum of $600 damages, from which defendant appeals.

Geo. C. Johnson, of Portland (Johnson & Mathews, of Portland, on the brief), for appellant. Fred W. Hummel, of Portland (Wilbur, Spencer & Beckett, of Portland, on the brief), for respondent.

McBRIDE, C.J. (after stating the facts as above).

The testimony as to the false representations and as to the value and character of the land is very conflicting. Plaintiff's witnesses place it all the way from a mere nominal value up to not in excess of $400, while defendant's witnesses value it from $1,000 up to $7,500, including the timber; and this estimate, if we were to credit it, would indicate that defendant was badly worsted in the trade. On the other hand defendant's witnesses place a value as low as $300 upon the furniture, etc., while some of plaintiff's witnesses place it as high as $1,800. All this was for the jury, and we are not permitted to disturb the verdict in that respect if there is any evidence to sustain it, as there certainly is.

The principal contention here centers around the admission of the oral testimony of plaintiff and Barnes tending to show that she was the real owner of the property traded to defendant, and that Barnes was acting as her agent. The testimony does not disclose that defendant was ever informed that plaintiff was the real principal, but rather that this fact was kept in the background; plaintiff testifying, "I wanted to keep my name out of it." It is a familiar rule that an undisclosed principal may sue upon a contract made by his agent to the same extent as if his relation to the contract were known at the time it was entered into. 2 Mechem on Agency (2d Ed.) § 2059, and cases there cited. It would seem logically to follow that the undisclosed principal can recover damages for a deceit practiced upon his agent in the course of a transaction in any case in which he would have a legal right to enforce the contract if no deceit had been practiced. But to the rules above announced there are exceptions as firmly supported by precedent as are the rules themselves, and we are of the opinion that this case comes within these exceptions, which are thus stated by Mr. Mechem:

"Sec. 2070. Principal cannot sue where terms of contract exclude him or where contract is solely with agent personally. The right of the principal to sue upon the contract made by the agent in his own name flows from the fact that the agent made the contract in reality, though perhaps this may have been unknown to the other party, as the agent of the principal, and by his authority; and the principal is therefore entitled to enforce the contract, not only upon the ground that the benefits of his agent's acts accrue to him, but also upon the ground that he is himself, when discovered, liable upon the contract to the other party. If, however, as is competent to be done, the other party

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