Hauck v. Crawford
| Decision Date | 30 December 1953 |
| Docket Number | No. 9389,9389 |
| Citation | 75 S.D. 202,62 N.W.2d 92 |
| Court | South Dakota Supreme Court |
| Parties | HAUCK v. GRAWFORD et al. |
Stephens & Riter and Eugene D. Mayer, Pierre, for appellants.
F. E. Hohman, Leola, and J. B. Graham, Ellendale, N. D., for plaintiff and respondent.
Although in form an action to quiet title, thr real purpose of this action is to cancel and set aside a certain mineral deed admittedly signed by plaintiff and certain other deeds transferring the mineral rights by the grantee named in the original deed. No one has questioned the form of the action. The trial court entered judgment cancelling the deeds and defendants have appealed.
Cancellation was asked because of alleged fraud, and it was upon this basis that the trial court entered its judgment. The defendants contend, first, that there was no fraud and second, that the mineral rights were transferred to a bona fide purchaser for value and are not, therefore, subject to cancellation even though obtained by fraud in the first instance.
The facts most favorable in support of the judgment of the trial court are as follows: Plaintiff is a farmer owning and operating a farm located partly in South Dakota and partly in North Dakota. He lives on that part of the farm located in South Dakota in McPherson County. Plaintiff is 44 years old, has an 8th grade education, married and has a family. His farm consists of two sections of land which he purchased at three different times.
On May 23, 1951, while plaintiff was at a neighbor's place, three men approached him and discussed leasing plaintiff's land for oil and gas. A Mr. Crawford was the principal spokesman. Plaintiff testified that after some discussion Crawford offered 25cents an acre for a lease. Plaintiff agreed, and one of the men apparently prepared the necessary papers on a typewriter while sitting in the back seat of the car. When the papers were prepared they were clamped to a board or pad and presented to plaintiff while in the car for signing. Printed forms were used which contained much fine print. The man who prepared the papers indicated where plaintiff should sign, and after signing in one place, partially turned the signed sheet and asked plaintiff to sign again, stating that this second sheet was a part of the lease, which plaintiff believed. Plaintiff testified that no mention was ever made of a mineral deed and to this extent is corroborated by Crawford who in response to the question, 'Did you ever describe to Mr. Hauck one of the instruments as a mineral deed?', answered, 'No, sir'. Separate instruments were required for the land in each state. Plaintiff never received a copy of any of the instruments he signed.
It now appears that somehow plaintiff had signed a mineral deed conveying onehalf the minerals in his land to D. W. Crawford. This deed was filed for record June 1, 1951, but on May 29, 1951, Crawford, the grantee, conveyed such mineral rights to the defendants White and Duncan at Gainsville, Texas. The trial court made no finding relating to the knowledge of White and Duncan concerning the conditions under which Duncan obtained the deed, but decided the case on the basis that they were in fact bona fide purchasers for value. This statement of the facts is sufficient for our present purpose.
We are concerned with a type of fraud which the trial court, texts and decided cases refer to as 'fraud in the factum' or 'fraud in the execution' as distinguished from 'fraud in the inducement'. This type of fraud relates to misrepresentation of the contents of a document by which one is induced to sign a paper thinking that it is other than it really is. It was this type of fraud with which this court was dealing in the case of Federal Land Bank v. Houck, 68 S.D. 449, 4 N.W.2d 213, 218. In this cited case we held that, as between the original parties, when a person is fraudulently induced to sign a paper believing that it is something other than it really is 'the contractual knot was never tied' and such paper or instrument is not only voidable but actually void. In that case it was further held in conformity with prior holdings that 'neither reason nor policy justifies the receiption of a showing of negligence on the part of him who is overreached, as a countervailent or neutralizer of fraud.' In other words, the perpetrator of the fraud cannot avoid his acts by a showing that the person upon whom the fraud was committed was negligent.
The Houck case, we are convinced, settles the issue of fraud. Accepting as a verity testimony of the plaintiff the misrepresentation and trickery of Crawford was complete. Crawford not only misrepresented the effect of the papers plaintiff signed, but by 'manipulation of the papers' as found by the trial court tricked plaintiff into signing the deed thinking it was the lease. Under the rule of the Houck case plaintiff's negligence, if any, does not neutralize this fraud. As stated in the Houck case there was 'no intention to do the act or say the words which manifest a volition to assent.' It must therefore be held that as between Hauck, the grantor, and Crawford, the grantee, the deed was void.
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