Euneau v. Rieger

• Decision Date: 30 June 1891
• Citation: 16 S.W. 854,105 Mo. 659
• Parties: EUNEAU v. RIEGER et al.
• Court: Missouri Supreme Court

16 S.W. 854

105 Mo. 659

EUNEAU v. RIEGER et al.

Supreme Court of Missouri, Division No. 2.

June 30, 1891.

PRINCIPAL AND AGENT — RIGHTS OF PRINCIPAL — CHAMPERTY.

1. A real-estate agent, having charge of property, notified his principal that the building on the lot had been condemned. The principal became uneasy, and, being anxious to get rid of the property, authorized the agent to sell it for $4,500, though it was worth $12,000. The agent sold it to a straw purchaser, advancing him the cash payment. The straw purchaser conveyed to the agent's brother, and the brother conveyed to the agent. The agent knew, at the time he sold the property for $4,500, that it was worth $12,000, and he was offered $10,000 by another party before the sale was consummated. The agent made improvements on the property. Soon after finding out that the agent was the real purchaser, the principal brought suit to set the transaction aside. Held, that the principal was entitled to a reconveyance, and the agent to the costs of improvements, less the rents he had received.

2. The fact that the principal was instigated to institute the suit by another real-estate agent, who paid him $1,000 to do so, and agreed to pay all costs and attorney's fees in consideration of a half interest in the property recovered, does not deprive plaintiff of his right to have the deed to defendant annulled, especially when the champertous contract was voluntarily rescinded at the trial.

Appeal from circuit court, Jackson county; R. H. FIELD, Judge.

C. O. Tichenor and T. B. Buckner, for appellants. Peak, Yeager & Ball, and Wash. Adams, for respondent.

THOMAS, J.

This was a suit in equity to set aside three certain conveyances to the north 20 feet of lot 284, in block 29, old town, Kansas City, Mo., — the one, a conveyance made by respondent to Frank V. Mills, March 14, 1887; another, a conveyance made by said Mills to C. Frank Rieger; and the third, a conveyance made by C. Frank Rieger to L. F. Rieger, — and to reinvest the title to said lot in respondent. The petition charges that on March 14, 1887, the plaintiff was the owner of the said property; that defendant Lawrence F. Rieger was then, and had been for a number of years, the agent of plaintiff for the purpose of looking after the repairs, paying the taxes, and collecting the rents on the property; that plaintiff then lived, and had for three or four years lived, in the Indian Territory; that defendant Lawrence F. Rieger, by false representations and by concealment of material facts, induced plaintiff on the 14th day of March, 1887, to sell and convey this property to one Frank V. Mills for the sum of $4,500, when it was worth $12,000; that Mills was not a bona fide purchaser of the property, but the conveyance was procured to be made to him for the benefit of said Rieger; that said Mills on March 19, 1887, conveyed the property to C. Frank Rieger, brother of said Lawrence F. Rieger, for the benefit of the latter, and on June 1, 1887, the property was conveyed to the latter. Lawrence F. Rieger filed answer, in which he denied the fraud alleged against him by plaintiff, and averred that he had made improvements to the amount of $4,560.35, with full knowledge of plaintiff, and without objection; that plaintiff continued to receive purchase money after full knowledge that defendant was the real purchaser; finally, that plaintiff was not the real party in interest, but that the suit was instituted by one J. E. McElroy, a man who was in the business of undermining owners' titles, and in bringing suits for that purpose; that said McElroy was paying plaintiff's attorneys, and agreeing to pay all costs of litigation; that the plaintiff was well satisfied with the sale, knew all the facts connected therewith, and never instituted the suit. Plaintiff, in his reply, denied the new matter set up in the answer. For convenience hereafter, when we use the word "defendant" we will mean L. F. Rieger alone. The trial court found the issues for plaintiff, and found that defendant had paid plaintiff on the purchase of the property, with interest, the sum of $747.05, and had expended on the property for taxes, insurance, and improvements the further sum of $3,419.50, making a total of $4,380.44, and that he had received rents from the property amounting to $2,540, leaving a balance in favor of defendant of $1,840.44, and divested defendant of the title to the property, and vested the same in plaintiff, and adjudged that plaintiff pay defendant $1,840.44, which sum was made a lien on the property.

1. The first contention of appellant is that the evidence did not warrant the finding and decree of the court. For a number of years prior to the 14th day of March, 1887, defendant L. F. Rieger had been the agent of plaintiff for the purpose of looking after the repairs, paying the taxes, and collecting the rents on the property, but never agent to sell it. On the 4th day of March, 1887, the building situated upon said ground had become so dangerous that the superintendent of buildings condemned the same as being unsafe, and served upon Rieger, as agent of plaintiff, a notice requiring him, by 12 o'clock the next day, to either tear down or make said building safe, or suffer the penalty provided by ordinance. Rieger immediately mailed said notice to Euneau, who then resided, and had for three or four years prior thereto resided, in the Indian Territory. Euneau arrived in Kansas City on the 8th or 9th of March. He came to Kansas City for the sole purpose of looking after said building. While there he made a personal examination of the building, saw its condition and surroundings, and saw that it was dangerous. Euneau had a contractor to make estimates on the building looking towards having it repaired. From Rieger and the contractor he learned it would cost to repair the building $3,000 or $3,500. Plaintiff paid $6,000 for the property when he obtained title to it, and he was receiving $125 per month rent for it. Owing to the condition the building was in, he concluded to sell, and he asked Rieger to sell it for him. We will let Rieger tell what was then done in his own language. He testified as follows:

"I says, `What is your idea about what you would want for it?' I says, `I guess I can get $4,500 for it.' He agreed to sell for $4,500. He asked me if I would take it and sell it for him, and I told him, `Yes.' He wanted to know how long it would take. He said he should put the price down low, so as to make the sale that day. Question. Was that the day the authority was signed for you to sell? Answer. Yes, sir. Q. That is the one? (showing witness paper.) A. Yes, sir; that is the order he signed at that time. That was on Monday; and on my way to dinner that day I stepped into the store where Mr. F. V. Mills worked, and told Mr. Mills that I had a piece of property for sale. Q. That was your brother's store, was it? A. Yes, sir. That I thought there was some money in it. He wanted to know where it was, and how much money it would cost, and the terms; and I told him the terms, — the same terms I had received authority to sell for, — $4,500. The Court. You told who that? A. Mr. Mills. I remarked to him, `Now,' I says, `this property is a little out of shape, and it will take some money to fix it up, — a few hundred dollars.' He says: `Well, Rieger, I don't want to go into anything of that kind. May be it will cost more money to fix it up than you think it will.' I says: `Well, in case you find it is going to cost you more than you think, and more money than you can make arrangements for, let me know, and I will take it off your hands.' He says: `With that provision, then, I will take the property, provided you will stand by me if I get into a tight place.' I says: `All right.' He says: `I have not got any money.' He says: `I will have to get the money from my mother to buy this property.' Q. Where does she live? A. In Sedalia. I had learned, before that, that he could get money if he wanted it, and I asked him if he had $500. He said, `No.' I told him that I would take $500 on that property. `Well,' he says, `if you will advance me $500, when I get my money I will get enough money to pay the $500, — pay half the purchase money.' We signed the contract with that understanding, and I went over to the office, and made a due-bill out, and put it in the drawer, for $500 due from Mills to pay on the contract, and put it in the safe. The next day Mr. Euneau came in and said, `Rieger, have you succeeded in selling the property for me, and get me out of trouble?' I says, `I think so.' He wanted to know who I sold it to. I says, `F. V. Mills.' I says, `Euneau, I have agreed with Mr. Mills that in case he should find the building in any worse shape than I had represented it, or find out after he examined it,' I says, `I will agree to take it off his hands.' I says, `He is a good friend of mine, and I want to protect him.' Mr. Euneau says, `It don't make any difference to me. I want to get clear of it. It is a big bother to me.' I says, `Well, that is the way I have succeeded in making the trade.' Q. Right there did you show him the contract? A. Yes, sir; I showed him the contract. I says, `Now, since I may come to have some interest in this case, in case Mills backs out of it,' I says, `you sign this contract. I have signed it as agent for you. You sign it, so that, if I should have to take it off Mr. Mills' hands, you sign it yourself.' He says, `All right.' He signed it. He says `Did you get the money?' I says, `I have advanced $500 for Mr. Mills, the purchaser, and I will get all the money from Mr. Mills as soon as the deed comes back, — as soon as everything is ready to close up.' Euneau says, `Give me that $500; then I will feel sure that the trade is made, and I am out of that building.' Q. Who is Mr. Mills? A. He is a young man that works in my brother's hat-store at 608 Main street; formerly from Sedalia, Mo. Q. At what...