Flack v. Wahl
| Decision Date | 06 February 1917 |
| Docket Number | No. 14463.,14463. |
| Citation | 193 S.W. 56,197 Mo. App. 10 |
| Parties | FLACK et ux. v. WAHL. |
| Court | Missouri Court of Appeals |
Appeal from St. Louis Circuit Court; Wm. T. Jones, Judge.
Action by Charles D. Flack and wife against G. A. Wahl. From a judgment for plaintiffs, defendant appeals. Affirmed on condition that plaintiffs enter remittitur, otherwise reversed and remanded.
John Cashman, of St. Louis, for appellant. R. P. & C. B. Williams, of St. Louis, for respondents.
This is an action at law for the recovery of damages for fraud alleged to have been perpetrated upon plaintiffs in a real estate transaction involving the exchange of properties. The action was originally instituted against defendant Wahl and one Duncan, the latter a real estate agent; but during the progress of the trial the case was dismissed as to Duncan. The trial, before the court and a jury, resulted in a verdict and judgment for plaintiffs, and defendant Wahl appealed.
Prior to July 2, 1908, plaintiffs owned a farm, referred to as their homestead, near Godfrey, Madison county, Ill., consisting of approximately 40 acres, upon which was located an eight-room residence and other improvements. The property was free and clear of incumbrance, and, it seems, reasonably worth $6,000. Defendant Wahl (to whom we shall refer as "defendant") owned three cottages on Kraft street, in the city of St. Louis, and had placed the same in the hands of a firm of real estate agents, Dougherty & Bush, in the city of St. Louis, for sale. Duncan was in the employ of Dougherty & Bush, or connected with them, as a salesman. It is said that he, acting for Dougherty & Bush, had previously sold a farm near that of plaintiffs, belonging to one Gillinwater, a brother-in-law of plaintiff Charles D. Flack; and that plaintiffs, having thus become acquainted with him, and being desirous of selling their farm, or obtaining income property therefor, placed it in the hands of Dougherty & Bush, who thus became the agents of both plaintiffs and defendant, though it appears that plaintiffs were not aware that these agents represented defendant. Through such agents, plaintiffs' farm was brought to the attention of Wahl, who inspected it, and while upon the premises proposed to plaintiffs to exchange his three said cottages therefor. Both of the plaintiffs testified that defendant represented to them that two of these cottages were then renting for $25 per month each, and one for $20 per month, a total of $70 per month; that the three, with the lots upon which they were situated, were covered by first mortgages thereon amounting in all to only $3,050; and that the lots and cottages were valued at and worth in the market $9,000, or $5,950 over and above the incumbrances thereon. Shortly thereafter, plaintiff Charles D. Flack came to the city of St. Louis to inspect the cottages. According to his testimony, he was taken out to the cottages by Duncan, but did not enter any of them. He says that Duncan told him that the tenants were people who worked at night and slept during the day, and could not then be disturbed. Plaintiffs both testified that they relied implicitly upon the representations made by defendant and Duncan, and made no investigations other than that above mentioned.
It appears that plaintiffs were inexperienced and ignorant respecting city property; while defendant, it seems, was an experienced dealer in real estate generally.
On July 2, 1908, plaintiffs and defendant entered into a written contract for the exchange of plaintiffs' farm for defendant's cottages. In making the trade the farm was valued at $6,000, the "equity" in the cottages was put in at $5,000, and defendant was to pay to plaintiffs $1,000 in cash. The trade was consummated on this basis; but in paying plaintiffs the cash difference in supposed values defendant deducted $200 or more as commissions for Duncan, or Dougherty & Bush. The written contract, prepared by Duncan or by some other person connected with Dougherty & Bush, after describing defendant's three houses, referred to them as being "subject to first deeds of trust of $1,550 and $1,500." Thereafter, on or about July 29, 1908, the deeds were exchanged, and defendant paid plaintiffs the money above mentioned. The deed which plaintiffs received to the cottages was executed by a brother-in-law of defendant, who had held the legal title to the property for defendant. It recited that one cottage was subject to a first deed of trust for $1,500, and that each of the other two was subject to a deed of trust for $1,550, a total incumbrance of $4,600. Such were in fact the first mortgage liens against the property received by plaintiffs. There were also second mortgages, but these were agreed to be released and were released.
In closing the transaction, plaintiff Charles D. Flack called in one Tietjens, a real estate dealer, to see that the papers were in proper form. Tietjens did not examine the cottages, or have anything to do with the transaction other than as above mentioned.
The evidence adduced by plaintiff goes to show that the cottages were not renting for $20 and $25 per month, as defendant is said to have represented, but that one was renting for $12 per month, while the other two were vacant; and that the property was found to be worth nothing over and above the mortgages. It appears that, shortly after the exchange of properties was consummated, plaintiffs went to relatives in Ohio; that Mrs. Flack was sick, and they did not return to St. Louis until June, 1909. In the meantime, the cottages, after some considerable delay, it is said, in getting them out of the hands of Dougherty & Bush, were placed by plaintiffs in the hands of another real estate firm for rent. Such rents as were collected, it seems, went to meet interest and expenses, and plaintiffs received no income therefrom. Plaintiffs held the property until on or about May 24, 1910. The notes secured by deeds of trust had become due, and the holder thereof was pressing for payment and about to foreclose; and plaintiffs, having been advised that their equity was worthless, conveyed the property by quitclaim deed, to the holder of the deeds of trust.
It is unnecessary to rehearse the details of defendant's evidence. Duncan testified that, when he took plaintiff Charles D. Flack to examine the cottages, Flack went through one of them. And he denied that he said or did anything to prevent Flack from making an investigation. Defendant could not recall having made any statements to plaintiffs as to the market value or rents of the cottages, when asked whether he had made any representations as to the rents, he repeatedly replied: "Not that I remember of."
The jury returned a verdict in plaintiffs' favor for $4,000. The trial court, in passing upon defendant's motion for a new trial, required plaintiffs to remit $1,500 of this verdict, upon the ground that the evidence did not warrant a recovery by plaintiffs for alleged false representations as to the amount of the incumbrance on the cottages received by plaintiffs from defendant. Plaintiffs filed such remittitur, and judgment was entered for $2,500. From this judgment the appeal before us is prosecuted.
Such further reference to the proceedings below will be made as may appear necessary to a disposition of the questions raised on appeal.
I. It is earnestly insisted by learned counsel for appellant that the evidence adduced by plaintiffs failed to make a prima facie case for the jury, and that the trial court erred in overruling appellant's demurrer to the evidence. But we regard it as altogether clear that there is no merit in this contention. The main argument advanced in this connection is that plaintiffs had full opportunity to investigate for themselves; and that plaintiff Charles D. Flack did investigate, as far as he chose; and that plaintiffs cannot now be heard to complain that they were deceived. But this argument avails nothing, under the circumstances of the case. We may omit reference to the alleged representations of defendant other than as to rents. The evidence as to the latter, alone, suffices to make the case one for the jury. See Thaler v. Niedermeyer, 185 Mo. App. 257, 170 S. W. 378, and cases cited. Defendant knew what the cottages were renting for, and plaintiffs did not. Plaintiffs, who were ignorant and inexperienced in matters of the sort, did not have equal means for obtaining this information; and plaintiffs' evidence makes it appear that Duncan, acting within the scope of his authority as defendant's agent, prevented a further investigation by falsely representing that the tenants slept during the day and could not be disturbed. Furthermore, plaintiffs had the undoubted right to rely upon defendant's unequivocal statements, if made, as to a matter of fact, of this character; and if such statements were false it does not lie in defendant's mouth to say that plaintiffs should not have been so negligent or foolish as to believe and rely upon them. See Judd v. Walker, 215 Mo. 312, 114 S. W. 979; Stonemets v. Head, 248 Mo. 243, 154 S. W. 108. Other questions raised in connection with this assignment of error need not be here discussed. We think that the demurrer was well ruled.
II. There is here no question as to the admissibility of evidence tending to prove that defendant made certain representations as to value. This evidence came in without objection; but the cause was not submitted to the jury upon the theory that defendant could be held liable for such representations, and we need not therefore consider the question whether any liability could thereby be cast upon defendant under the circumstances of the case. See Stonemets v. Head, supra.
III. The cause was submitted to the jury on ten instructions. Four of these were given at plaintiffs' request, three at the request of the defendant, and three by the court of its own motion. Ten instructions...
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