First National Bank of Green River v. Barrett

• Decision Date: 22 August 1939
• Docket Number: 2096
• Citation: 54 Wyo. 394,93 P.2d 510
• Parties: FIRST NATIONAL BANK OF GREEN RIVER v. BARRETT
• Court: Wyoming Supreme Court

93 P.2d 510

54 Wyo. 394

FIRST NATIONAL BANK OF GREEN RIVER v. BARRETT

No. 2096

Supreme Court of Wyoming

August 22, 1939

APPEAL from the District Court, Sweetwater County; H. R. CHRISTMAS Judge.

Action by the First National Bank of Green River, Wyoming, a United States banking corporation, against James Barrett, wherein the defendant filed a cross-petition. From a judgment for the plaintiff and denying defendant's cross-petition, the defendant appeals.

Judgment affirmed.

For the appellant, the cause was submitted upon the brief of Walter Q. Phelan of Cheyenne.

Defendant James Barrett dealt with T. S. Taliaferro, Jr., throughout the negotiations leading up to the execution and delivery of the note in controversy. Mr. Taliaferro was acting in at least three capacities, viz., he was attorney for defendant James Barrett; he was a director and president of the First National Bank of Green River, and he was also a director treasurer and manager of the Big Sandy Livestock Company. Acts of fraud by agent, committed in the course or scope of his employment, are binding on the principal, even though the principal was without knowledge of the acts and derived no benefit therefrom. 2 C. J. 849-850. The authorities on this point seem to be unanimous, where the fraudulent act is for the principal's benefit, as in the case where the bank acquires a valuable piece of property for less than one-half of its value. 26 C. J. 1091. False representations as to what will result in the future, when made by one having, or professing to have superior knowledge based on past experience, are false representations of existing conditions. Wendell v. Orchard Company (Mo.) 200 S.W. 747; Trust Company v. Henry (Idaho) 206 P. 175; Kritzer v. Moffat (Wash.) 240 P. 355; 44 A. L. R 681; 26 C. J. 1091; Daniel v. Daniel (Ky.) 226 S.W. 1070; Kefuff v. Whitley (Mich.) 189 N.W. 76; Bank v. Yelverton (N. C.) 117 S.E. 229; Company v. Wilson (Vt.) 120 A. 895; Lloyd v. Smith (Va.) 142 S.E. 363. Fraud may be predicated upon the non-performance of a promise, where the promise is made for the purpose of accomplishing fraud. 12 R. C. L. 216; Foster v. Dwire (N. D.) 199 N.W. 1017; 51 A. L. R. 21. Defendant appears in the picture in 1931 as the owner of 8,000 acres of land worth from eight thousand dollars to twelve thousand dollars, with an annual rental value of from one thousand dollars to one thousand two hundred fifty dollars. He winds up in 1937 empty handed; he has been entirely deprived of the income from the lands. The plaintiff now has the lands. His relations in 1931 with Mr. Taliaferro were of a confidential nature, being that of attorney and client. He therefore depended upon the representations, agreements and promises made to him on behalf of the plaintiff bank. He relied on such representations and promises and has been defrauded. Appellant therefore prays that the findings and judgment of the lower court should be reversed.

For the respondent, the cause was submitted on the brief of T. S. Taliaferro, Jr. and L. H. Brown, both of Rock Springs.

The record fails to show any fraud practiced upon appellant. Plaintiff's exhibit 18 was received in evidence, but for some reason was not included in the record. James Barrett had already leased the land from the Livestock Company before the execution of Exhibits 1, 2 and 5. The same thing is shown by the facts found by this court in Barrett v. First National Bank, 62 P.2d 318. Important phases of this controversy were disposed of by this court in the case of Barrett v. First National Bank, 62 P.2d 318. It is sometimes said that notwithstanding the rule that all negotiations and inducements anteceding a written contract, are merged in the writing, yet an unscrupulous litigant can get rid of this rule by alleging fraud. We believe that the case at bar furnishes facts which will enable this court to clear up a question which has been giving trouble. In the case of Barrett v. First National Bank, supra, it was held that the fraud alleged must have been coincident or connected with the signing and execution of the written instrument, and that the averment and proof of statements, made at different times prior to the signing and execution, could be used to predicate the claim of fraud in written instruments, complete in themselves and which speak for themselves. The authorities hold that the fraudulent representation must have induced the instrument to be signed. If the first party signed the instrument without undue influence, at the time and place of the signing, he will not be heard to say that he had not read it, or that the instrument was different from what he intended to sign under the circumstances. 13 C. J. 372; Terry v. Mutual Life Company (Ala.) 22 So. 533; Bostwick v. Mutual Life Co. (Wis.) 92 N.W. 248; Pimpinello v. Swift (N. Y.) 170 N.E. 531; New York Central v. Difendeffer, 125 F. 696; In re Greenfield's Estate, 14 Pa. 496; Upton v. Tribilcock, 91 U.S. 45; Androus v. St. Louis Co., 130 U.S. 643; In Stone's Estate (N. Y.) 5 N.E.2d 62; Aetna Insurance v. Detjen (Mo.) 211 S.W. 912; Furst v. Merritt (N. C.) 130 S.E. 44; Parker v. Parish (Ga.) 89 S.E. 381; Butler Company v. Campbell (Ala.) 78 So. 644; Finkelstein v. Henslin (Minn.) 188 N.W. 737; Widincamp v. Patterson (Ga.) 127 S.E. 158; Lillie v. Shriver (Ia.) 179 N.W. 633; Midland Company v. Rice (Ia.) 198 N.W. 25. There is no pretense either in the defendant's cross-petition or in the evidence, that Barrett was in any manner prevented by artifice from ascertaining the contents of the mortgage deed and notes. There is not one scintilla of evidence that any trick was perpetrated against the defendant by the plaintiff. The facts are quite similar to those reported in Lovell v. Potts (Ore.) 226 P. 1114; Dunham Lumber Company v. Holt (Ala.) 26 So. 664; Pollock v. Conn. Ins. Co. (Ill.) 199 N.E. 821; 26 C. J. 1165. The writer believes that the Supreme Court can render a real service to the Bar by explaining its holding in Barrett v. First National Bank (Wyo.) 62 P.2d 318, to the effect that it was not claimed that the plaintiff signed or executed the lease through fraud or mistake. The trial court did not err in admitting plaintiff's exhibits 7 and 8, nor in sustaining its objection to the reception of certain evidence offered by the defendant. The appellant has never sought a reformation of the mortgage deed or the notes secured thereby. This fact was referred to in the case of Barrett v. First National Bank, 62 P.2d 319. Upon the whole record, it is respectfully submitted that the judgment of the trial court should be affirmed.

Before Riner, C. J.; Kimball, J.; and Burgess, District Judge. RINER, Ch. J., and KIMBALL, J., concur.

OPINION

BURGESS, District Judge.

The First National Bank of Green River, Wyoming, brought suit in the District Court of Sweetwater County against James Barrett, setting up two causes of action. Barrett filed an answer and cross-petition. Upon the trial judgment was entered in favor of the Bank for the sum of $ 54.58, and the prayer of the cross-petition was denied. Barrett brings the case here for review. His only complaint revolves around the finding of the court against him on his cross-petition.

In his cross-petition Barrett alleges that he was the owner of certain lands in Sweetwater County; that the Bank acting through its president and attorney suggested to him that he make and deliver to it a mortgage on said lands and that as consideration therefor the Bank would advance sufficient funds to pay up the delinquent taxes upon the lands and to finance certain litigation then pending and involving the same; that as further inducement to the making of said mortgage the Bank promised and represented that it would collect from the lessee of said lands a sufficient sum over a period of five years to pay all the taxes levied against said property and to repay the amount represented in the proposed mortgage; that the Bank represented that the giving of the mortgage was necessary in order for Barrett to recover a certain certificate of stock in the Rock Springs Grazing Association which the Bank represented to him had been forfeited to...