Friesenhahn v. Bushnell

• Decision Date: 07 December 1891
• Citation: 47 Minn. 443,50 N.W. 597
• Parties: FRIESENHAHN v BUSHNELL ET AL.
• Court: Minnesota Supreme Court

47 Minn. 443

50 N.W. 597

FRIESENHAHNvBUSHNELL ET AL.

Supreme Court of Minnesota.

Dec. 7, 1891.

(Syllabus by the Court.)

1. Held, upon the facts, that the defendants bore to plaintiff the relation of agents to invest his money in the purchase of real property for him.

2. Also that plaintiff had a right to repudiate the investment, and to demand a return of his money-First, because they did not communicate to him that they were the sellers of the property which they assumed to buy for him; and, second, because they themselves had repudiated the trust by treating the property as their own, and executing a mortgage upon it.

Appeal from district court, Ramsey county; EGAN, Judge.

Action by Anton Friesenhahn against William M. Bushnell and others. Judgment for plaintiff. Defendants appeal. Affirmed.

Omar Bushnell, for appellants.

Otto K. Sauer, for respondent.

MITCHELL, J.

This action was brought to recover back money paid by plaintiff to defendants to be by them, as his agents, invested for him in the purchase of real estate, but which it is alleged they never in fact invested. The substance of the answer, briefly stated, is that the money was received by defendants to be invested in what they call “investment No. 84, according to their investment plan,” and that they had so invested it. We shall not attempt to explain the very novel and peculiar scheme which defendants call “their investment plan;” for, except so far as communicated and explained to the plaintiff, it is wholly immaterial in this case. Notwithstanding defendants attempted distinctions based on mere verbal quibbles, it is clear from the undisputed facts that the plaintiff paid over his money to defendants, to be by them, as his agents, invested for him in the purchase of real estate, that the relation of the parties was that of principal and agent, and therefore that their rights and liabilities are governed by the general rules of the law of agency, except so far as otherwise expressly agreed. It does appear that it was agreed and understood between the parties that, as plaintiff's money was not sufficient to buy an entire tract, it, and the money of other parties, would be put together and used in buying a tract of land for all of them, in which each was to have an interest in proportion to the amount of money he invested; that, for convenience' sake, the title was to be taken in the name of some third party, in trust for all those whose money was invested, and that when sold the defendants were to have the sale of it as agents for the parties in interest, for which services they were to receive a commission out of the proceeds of the sale, the balance of which was to be distributed among the investors in proportion to their respective interests. According to defendants' testimony, they told plaintiff, when he intrusted the money to them, that they were “figuring” on the piece of property in which they now claim to have invested his money; that they considered it very cheap; that they had a very small interest in it, which they proposed to retain; that the other parties interested in it wanted to dispose of it; and that they (defendants) could buy it very reasonably. So far as appears, this was all that defendants disclosed to plaintiff as to the ownership or condition of the property. Subsequently they made a report to him that his money, and that of certain other parties, (including $250 of their own money,) amounting in all to $2,950, had been invested in the purchase of this property, subject to a mortgage for $2,000, payable in one and two years,...