Curtley v. Security Sav. Soc.

• Decision Date: 22 March 1907
• Citation: 46 Wash. 50,89 P. 180
• Parties: CURTLEY v. SECURITY SAVINGS SOCIETY.
• Court: Washington Supreme Court

89 P. 180

46 Wash. 50

CURTLEY v. SECURITY SAVINGS SOCIETY.

Supreme Court of Washington

March 22, 1907

Appeal from Superior Court, Spokane County; Miles Poindexter, Judge.

Action by Isaac N. Curtley against the Security Savings Society. From a judgment for plaintiff, defendant appeals. Reversed and new trial granted.

William E. Richardson and P. C. Shine, for appellant.

E. O Connor, for respondent.

FULLERTON J.

The appellant is a corporation engaged in the business of buying and selling real estate. Some time prior to March 14, 1904 it procured a tax title to the east 45 feet of lot 10, in block 1 of City View addition to the city of Spokane, and on that day conveyed the property by quitclaim deed to one Robert Abernethy. Thereafter the corporation transcribed its records into new books, and by some oversight, not explained in the record, failed to note the fact that the lot above described had been sold. On January 10, 1905, and after its records had been so transcribed, it changed managers, electing to that position one George Mudgett, who had not theretofore been connected with the business management of the corporation. Mudgett on April 17, 1905, finding that this lot still appeared on the books of the corporation as its property, on the application of the respondent, caused it to be conveyed to him by quitclaim deed for a consideration of $35. On May 25, 1905, the respondent entered into a contract with the Cooke-Clarke Company, a corporation, for the erection of a dwelling house upon the lot at the contract price of $2,400, paying thereon at the time of its execution the sum of $25, and agreeing to pay $500 on or before July 15, 1905, and $25 per month thereafter until the whole of the purchase price should be paid. He also purchased the plans for the house of the same corporation, agreeing to pay for them the sum of $100. Mudgett discovered the fact that the property had been previously sold to Abernethy on June 3, 1905, and immediately sought out the respondent and offered to return to him the purchase price of the lot, with interest and the cost of recording the deed, believing then that the same had been recorded, requesting at the same time that the respondent deed the property to the grantee or Abernethy, that there might be no cloud on Abernethy's title. The respondent refused to settle on this basis, and immediately began this action demanding judgment for $2,700 damages, filing his complaint on July 10, 1905. The action was then suffered to rest until November 14, 1905, when an amended complaint was filed. In this amended complaint the respondent set out the transaction substantially as above narrated, and alleged that at the time he purchased the lot Mudgett, with intent to deceive and defraud him, falsely and fraudulently represented that the appellant had a good title to the property, and that its deed of conveyance would convey a good title to the lot to the respondent, and that the relied upon such representations, and for that reason did not have the title to the property examined. He further alleged that Cooke-Clarke Company brought an action against him for breach of the building contract, and recovered judgment against him for the sum of $447.20, which sum he was compelled to and did pay, together with the sum of $100 to an attorney for defending the action; that these sums, together with $100 paid for the plans of the house, $25 paid upon the contract, and $35 for the lot, aggregated $707.20, for which sum judgment was demanded. Issue was taken on the allegations of the amended complaint, and a trial had which resulted in a verdict and judgment for the respondent for the full amount demanded.

The appellant at the trial objected to the introduction of any evidence on the part of the respondent on the ground that the complaint did not state facts sufficient to constitute a cause of action. In support of this contention, the appellant argues that false representations, to be actionable, must be made under such circumstances as will justify a reasonably prudent person in acting upon them, and, since it appeared on the face of the complaint that the representations upon which the respondent relied were made with reference to the title to the property, which was a matter of record accessible to the respondent, he cannot be said to have acted as a reasonably prudent person ought to have acted, since he did not avail himself of the opportunity afforded him to test the truthfulness of the representations, and hence cannot be heard to complain of being defrauded. But the argument is not sound. While this court has, in common with many other courts, held that false representations, involving mere matters of opinion, or question of judgment, as much within the knowledge of one party as the other, are not grounds for an action of deceit, it has also held that false representations as to the quantity of land contained in a given description, or false representations as to the boundaries and location of land, or as to its title, if made positively and with the intent that they should be relied upon, were not of that sort, but were actionable, if relied upon by the vendee to his injury. Hanson v. Tompkins, 2 Wash. 508, 27 P. 73; Sears v. Stinson, 3 Wash. 615, 29 P. 205; Lawson v. Vernon, 38 Wash. 422, 80 P. 559, 107 Am. St. Rep. 880; Freeman v. Gloyd (Wash.) 86 P. 1051. Such, also, is the general rule. 14 Am. & Eng. Ency. Law (2d Ed.) pp. 24, 88; 29 Am. & Eng. Ency. Law (2d Ed.) 654-657; David v. Park, 103 Mass. 501. The reason usually given for the distinction is that representations as to the quantity of land in a given tract, its title, or as to its location on the ground, are representations as to matters of fact, not of opinion, and that representations of a vendor to a vendee as to matters of fact which he knows to be false, and on which the vendee relies to his injury, will sustain an action of deceit, even if the vendee might have discovered the fraud by further inquiry; while it is only representations involving matters of judgment or opinion that do not afford the remedy of deceit. The complaint therefore did not fail to state facts sufficient to constitute a cause of action, merely because it alleged that the false representations consisted of matters the truth or falsity of which could have been ascertained by searching the public records.

On the trial the court received in evidence, over the appellant's objection, the judgment and judgment roll in the case brought against the respondent by Cooke-Clarke Company. The appellant insists that this was error, for the reason that it was not a party to the action in which the judgment was entered, or notified to appear and defend while the action was pending for trial, and hence is not bound by the judgment. But, while the appellant is not bound by the judgment in the sense that it is estopped to question its validity or the justice or legality of the claim upon which it is founded, the judgment was nevertheless competent to prove certain of the issues of the case,...