Gittings v. von Dobn

• Decision Date: 06 February 1920
• Docket Number: No. 48.,48.
• Parties: GITTINGS v. VON DOBN et al.
• Court: Maryland Court of Appeals

109 A. 553

GITTINGS

v. VON DOBN et al.

No. 48.

Court of Appeals of Maryland.

Feb. 6, 1920.

Appeal from Court of Common Pleas, Baltimore City; Robert F. Stanton, Judge. "To be officially reported."

Action by Theodore F. Von Dorn and another against Julian E. Gittings. From judgment for plaintiffs, defendant appeals. Reversed.

Argued before BOYD, C. J., and BURKE, PATTISON, URNER, STOCKBRIDGE, and ADKINS, JJ.

John C. Gittings, of Washington, D. C. (Joseph Addison, of Baltimore, on the brief), for appellant.

Arthur L. Jackson, of Baltimore, for appellees.

PATTISON, J. This is an action for deceit, brought by the appellees against the appellant to recover damages said to have been sustained by them because of certain alleged misrepresentations made to them by the appellant.

The declaration consists of four counts. In the first it is alleged that:

In September, 1913, the appellee Theodore F. Von Dorn entered into a contract or an agreement with one Roseoe Crary, "both individually and as president of the Dare Lumber Company, a body corporate, duly incorporated under the laws of the state of New York, whereby the said plaintiff agreed to seek a purchaser for the properties of the Dare Lumber Company, situated at Elizabeth City, North Carolina," consisting of sawmills, timber, lumber, supplies, etc., "and of the East Lake Lumber Company, a body corporate, duly incorporated under the laws of the state of New York, consisting of 180,000 acres of land, more or less, with the timber thereon, situated in Dare county, N. C., and for his services in finding such purchaser the said Roseoe Crary, individually and as president of the Dare Lumber Company, and as the alleged authorized agent of the East Lake Lumber Company, agreed to pay to the said Von Dorn, plaintiff, * * * a consideration, commission, or brokerage, in the event of a sale of the said property, amounting to $50,000. And thereafter, to wit, in the month of October, 1914, the said Von Dorn, the plaintiff,

* * * entered into negotiations with Julian E. Gittings, the defendant * * * [appellant in this court], both individually and upon representation by him that he was the president and a director of the East Lake Lumber Company and a large stockholder in said company, and, further, upon his representation that he was the authorized agent of the said East Lake Lumber Company, and also of the Dare Lumber Company, whereby the said Von Dorn, plaintiff,

* * * undertook to seek a purchaser for the properties of the said Dare Lumber Company and the East Lake Lumber Company, and such negotiations were had between the said plaintiff and the defendant * * * as that on the 24th and 25th days of November, 1914, and at divers other times, the defendant, * * * craftily contriving and intending to deceive, defraud, and cheat the plaintiff, * * * represented to the plaintiff Von Dorn that if the said Von Dorn could furnish and procure a purchaser for the said property, he, the said Von Dorn, could and would obtain a contract for compensation or commissions for such sale, and falsely informed the said Von Dorn that he was a large stockholder in, and a director and president of, the East Lake Lumber Company, and that by a resolution of the stockholders or board of directors of said company and said Dare Lumber Company, he was authorized to contract for the payment of a commission or brokerage or compensation to be paid in the event of a sale of the properties of the said companies, amounting to $50,000, and that as soon as a sale was negotiated to any person introduced by the plaintiff * * * the defendant would procure and deliver to the plaintiff Von Dorn a formal contract for the sum of $50,000, and that he would personally assume or adjust the compensation or commissions to be paid to the plaintiff * * * in the event of a sale of the said properties, and that the said Crary and the defendant * * * were the only persons authorized by the above-named corporations to sell and dispose of the said properties. That during the month of October, 1914, the plaintiff Von Dorn associated himself, as party to the above-named contract, with the knowledge and consent of the defendant, * * * the plaintiff Frank Weeks, as co-contractor with the plaintiff Von Dorn. And relying upon said false and fraudulent representations, on or about the 5th day of February, 1915, the plaintiffs, * * * believing at that time the said representations to be true, and having no knowledge nor notice of their falsity, agreed with the defendant

* * * that the compensation or commissions to be paid to the plaintiffs in the event of a sale of the said properties should be $50,000. And thereafter the plaintiffs, * * * relying upon the truth of the statements made by the defendant, * * * to wit, that he and the said Crary were the only persons authorized by the said companies to dispose of the said properties, and that he was a large stockholder and a director and the president of, the said East Lake Lumber Company, and that by resolution of the stockholders or board of directors of said East Lake Lumber Company, and said Dare Lumber Company, he was authorized to contract for the payment of a commission or brokerage or compensation to be paid in the event of a sale of the properties of the said companies, amounting to the sum of $50,000, and that as soon as a sale was negotiated to any person introduced by the plaintiff * * * the defendant would procure and deliver to the said Von Dorn a formal written contract for the said sum of $50,000, and that he would personally assume or adjust the said compensation or commissions to be paid to the plaintiffs * * * in the event of a sale of the said properties, introduced to the defendants * * * and to the said Crary a certain George F. Montgomery, of New York City, as a prospective purchaser of the said properties, and actively aided and assisted in carrying on such negotiations with the said Montgomery as that said negotiations were finally consummated by the sale of said properties to the said Montgomery, and the purchase of the same by him for the sum of $1,000,000.

"And the plaintiffs further say that the said representations of the defendant, Gittings, * * * were in fact false and fraudulent, and known to be false and fraudulent by the said Gittings when made, in that said Gittings was not at that time the president and director, or a stockholder, of the said companies, or either of them, and was not authorized by the said companies to make a contract with the plaintiffs, * * * or either of them, to bind the said companies, or either of them, to pay to the plaintiffs * * * a commission or compensation for the making of said sale, but said false and fraudulent representations and statements were made by the defendant * * * craftily, contriving and intending thereby to induce the plaintiffs * * * to secure a purchaser for the said properties, and to deceive, defraud, and cheat the plaintiffs, in that in fact the said Julian E. Gittings then had a contract with the said companies, whereby he was to be paid a commission in the event of a sale of the property of the East Lake Lumber Company of 10 per cent. in case he procured a purchaser of the said companies, knowledge of which fact the said Gittings fraudulently and maliciously suppressed and kept from the plaintiffs, * * * and the plaintiffs had no knowledge nor notice of the falsity of any of the statements made by the said Gittings, as above recited, and no knowledge nor notice of the real and true agreement between him and the said East Lake Lumber Company, whereby the plaintiffs have been deceived, cheated, and defrauded, in that they have not received any commission from either of the said companies, or from the defendant, or from any other person, for negotiating the sale of the properties above mentioned, although upon such sale the said Gittings has received his commission for the same."

In the second, third, and fourth counts of the declaration, no allusion is made to the alleged contract between Von Dorn and Crary which is mentioned in the first count of the declaration. In other respects, these counts are very similar to the first count. In the second it is alleged that the defendant represented to the plaintiff that he was the authorized agent of the two corporations, and was authorized by them "to contract so as to bind them, and each of them, for the payment of a commission" to the plaintiff if he furnished or procured a purchaser for said properties. While in the third count it is alleged that the defendant, in addition thereto, represented himself to be the president and a director of the East Lake Lumber Company, and in the fourth count that he was the agent of the East Lake Lumber Company, and authorized by it to make a contract binding upon said company to pay commissions for the sale of said property.

A demurrer filed to each of the counts of the declaration was overruled, and the general issue plea, that the defendant did not commit the wrongs alleged, was filed. The case then proceeded to trial, and resulted in a verdict for the plaintiffs for the sum of $50,000. A judgment was entered thereon for that sum, and it is from that judgment this appeal is taken.

Eleven exceptions are found in the record to the rulings of the court upon the admission, or rejection, of testimony, and one to its rulings upon the prayers.

The defendant's first prayer asked that the jury be instructed that—

"There is no evidence in this case legally sufficient to entitle the plaintiffs to recover under the pleadings in the case, and their verdict must be for the defendant."

This prayer was refused.

In considering this prayer we must be controlled by the well-established principles of law upon which the plaintiff's right to recover in cases of this character depends. To entitle the plaintiff to recover it must be shown: (1) That the representation made is false; (2) that its falsity was either known to...