First Realty & Inv. Co., Inc. v. Rubert

• Decision Date: 03 October 1979
• Docket Number: No. 12290,12290
• Court: Idaho Supreme Court
• Parties: FIRST REALTY & INVESTMENT CO., INC., a corporation, Plaintiff and Counterdefendant, Respondent, v. Milton T. RUBERT and Lynne H. Rubert, husband and wife, Defendants and Counterclaimants, Appellants.

Page 1149

600 P.2d 1149

100 Idaho 493

FIRST REALTY & INVESTMENT CO., INC., a corporation, Plaintiff and Counterdefendant, Respondent, v. Milton T. RUBERT and Lynne H. Rubert, husband and wife, Defendants and Counterclaimants, Appellants.

No. 12290.

Supreme Court of Idaho.

Oct. 3, 1979.

McLaughlin Law Offices, Chartered, Michael R. McLaughlin, Mountain Home, for defendants and counterclaimants, appellants.

Jeff Stoker, of Johnson & Stoker, Rayborn, Rayborn & Ronayne, Twin Falls, for plaintiff and counterdefendant, respondent.

BISTLINE, Justice.

Following very extensive discovery procedures over a long period of time this action became at issue and a trial to a jury commenced on February 23, 1976. The basic nature of the issues is best stated by the exact language of the court's given instruction No. 10:

"Ladies and Gentlemen of the Jury. In this case, the Plaintiff, First Realty & Investment Co., a corporation, seeks to recover from the Defendants, Milton T. Rubert and Lynne H. Rubert, husband and wife, the sum of $16,500.00 which Plaintiff claims is due and owing to it, the corporation, from the Defendants, Mr. and Mrs. Rubert, as a result of a promissory note executed by the Defendants to the Plaintiff.

"The Defendants do not deny the note was executed, or signed, by them but do allege they are not liable for the amount of the note, to the Plaintiff, because of failure of consideration and/or fraud or duress in obtaining the execution of the note.

"Thus, these defenses of the Defendants, called affirmative defenses, are major issues for consideration in the case and the Defendants have the burden of proving the affirmative, or the factual existence, of these defenses or either of them.

"The issues then, for your consideration, is to ascertain from the evidence and the law as explained in these instructions, whether Defendants have proved by a preponderance of the evidence the existence of the following:

"1. A failure of consideration for the execution of the promissory note;

"2. That the Plaintiff, by or through its agents, obtained the execution and delivery of the note through fraud or duress."

Both parties had requested the submission to the jury of numerous special interrogatories, but the court gave the jury only the two foregoing questions to answer, doing so by way of special verdict. At an instructions conference the court explained to counsel his reasons for so doing.

"THE COURT: I might say while we are on this subject of the manner in which the matter will be submitted to the jury, I have made every effort that I could to simplify the issues within the framework of the evidence, primarily for the benefit of the jury. I think we must remember that we are dealing with sophisticated business matters and sophisticated legal matters as well, and I think it's certainly my purpose to submit the matter to the jury on the factual issues as simply as possible for the benefit of their consideration, and I feel these two questions are the primary issues in the case, and submitting these two issues in the form of special interrogatory is appropriate. Now, also I would state that I appreciate your submission, both parties, of several interrogatories. The problem I had with those is if we submitted all of those issues to them in that form very possibly we could come up with no verdict. There would be conflicts therein, particularly since each instruction would have to bear or each special question would have to bear with it the instructions on which party has the burden upon that particular issue. So, in effect, I have boiled it all down. I think both of those questions which you have submitted are issues but I think most of them are included within these two ultimate issues which will be submitted to the jury."

Neither party voiced any objection to the court's decision and reasons for utilizing a special verdict with the foregoing two interrogatories, and neither party registered any objection to the court's refusal of any of their numerous requested special interrogatories. ¹

I.R.C.P. No. 49 provides:

"Special verdicts and interrogatories Special verdicts. The district court may require a jury to return only a special verdict in the form of a special written finding upon each issue of fact. In that event the court may submit to the jury written questions susceptible of categorical or other brief answer or may submit written forms of the several special findings which might properly be made under the pleadings and evidence; or it may use such other method of submitting the issues and requiring the written findings thereon as it deems most appropriate. The court shall give to the jury such explanation and instruction concerning the matter thus submitted as may be necessary to enable the jury to make its findings upon each issue. If in so doing the court omits any issue of fact raised by the pleadings or by the evidence, each party waives his right to a trial by jury of the issue so omitted unless before the jury retires he demands its submission to the jury. As to an issue omitted without such demand the court may make a finding; or, if it fails to do so, it shall be deemed to have made a finding in accord with the judgment on the special verdict." (Emphasis added)

The trial court's observation that the controversy involved "sophisticated business matters and sophisticated legal matters as well" was not an overstatement. A point heavily relied upon by the Ruberts was that First Realty in initiating the action did not have possession of the note sued upon; the note was in an escrow in Arizona opened in a transaction between the DeModenas and the Lims, as respective sellers and buyers of what we will refer to as the Tucson mobile park. The Tucson mobile park had been owned by the Ruberts; they had employed Huff Realty to sell it, and authorized Huff to put it on the multiple listing service.

First Realty (and other Arizona firms) brought prospects to the Ruberts, but nothing developed, or could develop, because of a title defect which was later cleared up. Thereafter the Ruberts entered into an exchange agreement with the DeModenas the Tucson mobile home park in return for a Mountain Home, Idaho, mobile home park owned by the DeModenas. As stated, at about the same time the DeModenas sold the Tucson park to the Lims. The Ruberts claimed that First Realty had no involvement, on their behalf at least, in that exchange and that they absolutely remained aloof from the DeModena-Lim transaction. First Realty claimed otherwise, contending that the Rubert-DeModena exchange was maneuvered into a tax-deferred exchange for the benefit of the Ruberts, and that First Realty was instrumental on behalf of the Ruberts in bringing about the tax-deferred exchange, which First Realty asserted was a three-party transaction involving the Ruberts, the DeModenas, and the Lims. The Ruberts were sent the $16,500 note, refused to sign it, and later did, contending that they did so on the deceitful assurances of an employee of the agency which was to handle the DeModena-Lim escrow to the effect that it was a formality, and the Ruberts would not be obliged to pay the note. The foregoing is what we perceive to be the facts of the underlying controversy, which have been gleaned from the briefs and the appeal record.

Twelve jurors found no failure of consideration. Ten found no fraud or duress attendant to the execution and delivery of the note.

Thereupon the court entered findings of fact, setting forth the two findings on the special verdict, and finding also:

"1. That plaintiff, First Realty & Investment Co., Inc., a corporation, on or about the 15th day of May, 1972, provided that a promissory note was sent to the defendants in Idaho.

"2. That defendants, Milton and Lynne Rubert, received said promissory note on or about May 15, 1972, and that they signed and executed said instrument and returned it to Arizona Title and Trust Company of Tucson, Arizona, who was acting as plaintiff's agent in regard to the note.

"3. That the sending, by the defendants, of the promissory note to Arizona Title and Trust Company constituted a voluntary transfer of possession of the note."

The findings in the record are those set forth below. If any material findings have been omitted, the parties and this Court alike are bound by the final sentence of Rule 49 which states:

"As to an issue omitted without such demand the court may make a finding; or, if it fails to do so, it shall be deemed to have made a finding in accord with the judgment on the special verdict."

Judgment was entered for First Realty following which the Ruberts moved for a new trial, which was denied by memorandum decision. Ruberts appeal from both the final judgment against them and the order denying them a new trial.

On appeal the Ruberts outline eight issues of error:

I. Eleven different instances, referred to only by page and line, where the court improperly commented from the bench;

II. Failure to instruct on Ruberts' counterclaim and defense;

III. Admission of First Realty's Exhibits 2, 5, and 10;

IV. Admission of incompetent, irrelevant and immaterial testimony offered by First Realty witnesses with page and line reference to where the testimony is found, 7 instances;

V. Denial of Ruberts' Exhibits A, B, D, N, and P, and certain testimony, unidentified other than by reference to page and line, 21 instances;

VI. Denial of Ruberts' counterclaim;

VII. Denial of Ruberts' motion for new trial based on newly discovered evidence;

VIII. "The verdict is not supported by the facts on consideration, revocation, and delivery."

We will dispose of each designated issue in turn.

Issue I : Although Ruberts in their opening brief cite authority for the proposition that a trial judge may not comment on the evidence or intimate to the jury the court's opinion, in not one single instance was any of the challenged comment set forth or argued.

Under such...