Dolan v. Rabenberg
| Decision Date | 13 June 1950 |
| Docket Number | No. 1,No. 41207,41207,1 |
| Citation | 360 Mo. 858,231 S.W.2d 150 |
| Parties | DOLAN v. RABENBERG et al |
| Court | Missouri Supreme Court |
S. D. Flanagan, St. Louis, A. Evan Hughes, Clayton, for appellants.
Frank L. Ramacciotti and Roberts P. Elam, St. Louis, for respondent.
Action for fraud and deceit, to wit, false and fraudulent representations, willfully and maliciously made by defendants to plaintiff for the purpose of deceiving the plaintiff and inducing the execution of an earnest money contract for the purchase of described real estate in St. Louis county. Plaintiff alleged that defendants knew they could not perform the contract; that it was not performed; that the real estate agreed to be sold to plaintiff for $45,000 was of the reasonable value of $65,000; and that it was sold to another person. Plaintiff seeks to recover, as actual damages caused by the fraud, the benefit of his bargain obtained by the fraudulently induced contract. It being in effect plaintiff's theory that the same fraud, which induced the execution of the contract by which the bargain was obtained, caused the loss of the bargain and the damage to plaintiff by the non-performance of the contract; and that plaintiff is further entitled to recover exemplary damages. Plaintiff obtained a verdict and judgment for $2,700 actual and $12,100 punitive damages. Defendants have appealed and contend that no case was made for the jury. We shall continue to refer to the parties as plaintiff and defendants.
On March 22, 1946, plaintiff learned from one Holton that defendants Rabenberg and Kitchell were respectively president and secretary-treasurer of the Maplewood Motor Sales Company, a corporation, which owned the described real estate; and that the stockholders of said corporation were desirous of selling the property and liquidating the corporation. Plaintiff had known the property for years and knew that it was in the possession of the Lowry Motor Company. Plaintiff prepared a form of earnest money contract, entitled 'receipt for earnest money,' signed his sister's name thereupon as purchaser (she was a straw party for him) and arranged conferences with Rabenberg, Kitchell and others, submitting an offer of $41,000 for the property. On March 25, an agreement was reached and the form of the receipt for purchase money was modified and signed by plaintiff and the defendants. The sale price of the property was fixed at $45,000, receipt of $1,000 earnest money was acknowledged, sale under the contract was to be closed on or before May 1, 1946, and possession was to be delivered on July 1. The contract contained the following provisions:
On March 28, the vendors notified the lessee, Lowry, to vacate the described property within 90 days. The lessee replied that he was in possession under a 5 year lease dated January 23, 1945, by which he had a prior right to purchase the premises for the same price and on the same terms as a bona fide purchaser. He asked the terms of the proposed sale of the property to plaintiff and, on April 2, he recorded his lease. On April 26, plaintiff tendered to defendants $44,000 in cash, the balance of the purchase price and demanded performance, but defendants refused the tender. On April 27, defendants repudiated their contract with plaintiff and returned to him the original cashier's check for $1,000, which he had deposited. Plaintiff retained and cashed this check. When plaintiff obtained a certificate of title to the property, the certificate disclosed Lowry's lease and prior option to purchase the premises. Plaintiff did not pay the cost of this certificate but apparently the defendants caused payment to be made, although the record is not entirely clear. On June 7, lessee Lowry exercised his option and purchased the property for $45,000. In view of the conclusions we have reached it will not be necessary to review the evidence concerning the alleged representations, their falsity and defendants' knowledge thereof, the intent with which the representations were made and plaintiff's reliance thereon, but some other facts will be stated in the course of the opinion.
Plaintiff's theory is eloquently evidenced by instruction 1, offered and given to the jury at his request, as follows: 'The Court instructs the jury that the writing referred to in evidence as the 'earnest money contract' and the 'receipt for earnest money,' bearing date of March 22, 1946, was and is a valid and binding contract whereby the defendants Edward H. Rabenberg and Ernest B. Kitchell sold the real estate mentioned in evidence, referred to as 7434 Manchester Avenue, for the price and sum of Forty-Five Thousand Dollars ($45,000.00) in cash to be paid upon the closing of the sale on or before May 1, 1946, of which the One Thousand Dollars ($1,000.00) receipted for in said 'earnest money contract' was a part, and whereby the defendants bound themselves to convey perfect title to said real estate by general warranty deed upon the closing of said sale and to deliver the possession of said real estate to the purchaser on July 1, 1946.
'Therefore, the Court instructs you that, if you find and believe from the evidence that on or about the 25th day of March, 1946, the plaintiff met with defendants and James O. Holton at the office of the defendant Ernest B. Kitchell for the purpose of discussing the possible sale by defendants of the aforesaid real estate, and that the defendants then and there, for the purpose of inducing the plaintiff to enter into said 'earnest money contract' for the purchase of said real estate, if you so find, represented to the plaintiff that defendants and James O. Holton represented all of the stockholders of the Maplewood Motor Sales Company, a corporation, that the defendants were agents and representatives of said Maplewood Motor Sales Company with authority to sell and convey said real estate for said company, and that the defendants as officers of said Company were in a position to convey and deliver fee simple title to said real estate to a purchaser thereof and to deliver possession of said real estate to a purchaser thereof on July 1, 1946; and if you further find that the plaintiff relied upon the aforesaid representations of defendant, and in reliance thereon, if you so find, then and there entered into said written 'earnest money contract', either in his own name or in the name of Marcella Slaughter as his straw party, if so, or in both his name and the name of Marcella Slaughter as his straw party; and if you further find that the aforesaid representations made by defendants (that defendants and James O. Holton represented all of the stockholders of the Maplewood Motor Sales Company, that the defendants were agents and representatives of said Company with authority to sell and convey said real estate for said Company, and that defendants as officers of said Company were in a position to convey and deliver fee simple title to said real estate to purchaser thereof and to deliver possession of said real estate to a purchaser thereof on July 1, 1946) were false, and were known by defendants to be false, or were made by defendants as of their own knowledge when defendants had no knowledge thereof, if so; and if you further find that on or about the 26th day of April, 1946, plaintiff tendered to defendants in cash the balance of Forty-Four Thousand Dollars ($44,000.00) due on the purchase price of said real estate under the aforementioned 'earnest money contract,' and that defendants refused to accept the same, or any part thereof; and if you further find that on or about the 27th day of April, 1946, the defendant Ernest B. Kitchell acting on behalf of the defendants, if you so find, advised and informed plaintiff that said 'earnest money contract' was legally invalid and void and that the defendants were without authority to make a sale under it on behalf of said Maplewood Motor Sales Company; and if you further find that defendants and the said Company would not and did not perform the said 'earnest money contract'; and if you further find that the reasonable market value of said real estate, as of May 1, 1946, exceeded the purchase price thereof provided for by said 'earnest money contract,' then your verdict must be in favor of the plaintiff and against the defendants herein.'
The jury was further instructed that, if their verdict was for plaintiff, they should award him actual or compensatory damages for the amount the reasonable value of the premises on May 1 exceeded the purchase price fixed by the agreement; and that, if they believed and found that defendants maliciously made the false representations, as set out in instruction 1, they were at liberty to award to plaintiff punitive or exemplary damages.
Appellants challenge the sufficiency of the evidence to make a case for the jury on many grounds and insist that the court erred in submitting the issue of fraud to the jury. Respondent, however, says the sufficiency of the evidence was not tested in the trial court by a request for a directed verdict and the matter is not for review. Respondent relies particularly on Secs. 100, 112 and 140 of the Civil Code, Laws 1943, p. 353, Mo.R.S.A. Secs. 847.100, 847.112, 847.140.
At the close of plaintiff's case defendants' counsel made an oral request for a directed verdict and filed instruments in writing, styled motions to dismiss, requesting the court to dismiss plaintiff's case because plaintiff had failed to prove his case, had...
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...S.W.2d 441, 443 (Mo.1988) (en banc). The failure to establish any one of the elements is fatal to a fraud claim. Dolan v. Rabenberg, 360 Mo. 858, 231 S.W.2d 150, 154 (1950). "When fraud is alleged the burden of proof as to each element falls on the party asserting the fraud and fraud is nev......
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