Lavalleur v. Hahn

• Decision Date: 20 October 1911
• Citation: 132 N.W. 877,152 Iowa 649
• Parties: HORACE LAVALLEUR and L. L. LAVALLEUR, Appellants, v. J. H. HAHN, Appellee
• Court: Iowa Supreme Court

132 N.W. 877

152 Iowa 649

HORACE LAVALLEUR and L. L. LAVALLEUR, Appellants, v. J. H. HAHN, Appellee

Supreme Court of Iowa, Des Moines

October 20, 1911

Appeal from Jasper District Court.--HON. BYRON W. PRESTON, Judge.

ACTION to recover a sum of money secured by defendant from plaintiffs through fraud and deceit. Defendant's defense was a general denial. At the conclusion of the testimony, the trial court directed a verdict for defendant, and plaintiffs appeal.

Reversed.

Mowry & Cross, for appellants.

Tripp & Tripp and E. J. Salmon, for appellee.

OPINION

DEEMER, J.

Plaintiffs are residents of Jasper county, Iowa and defendant is a resident of the same county, and in the year 1907 was engaged in the real estate business at the town of Colfax. One L. E Zachary, at that time a resident of Colorado, living at the city of Pueblo, owned three hundred and twenty acres of land in Jasper county, Iowa which plaintiffs were desirious of purchasing, and they employed defendant to purchase the same for them from Zachary. Defendant was in partnership with one Stouffer, and it seems that on the 21st day of September 1907, this partnership, in the name of Hahn & Stouffer, entered into a written contract with Zachary and wife for the purchase of the three hundred and twenty acres of land at the agreed price of $ 24,000. This contract was entered into pursuant to correspondence had between Zachary and defendant during the latter part of August and the 1st of September of the year 1907. At the time of the purchase, defendant represented to Zachary that he was buying the land for other parties, who lived in Kansas, but that for convenience the land was to be conveyed to him. By the terms of the contract, Zachary was to deed the land before March 10, 1908, but, as a matter of fact, the deed was made by Zachary and wife to J. H. Hahn and H. G. Stouffer on October 3, 1907, although not delivered perhaps until a later date, and recorded March 30, 1908. Defendant stated at the time the deed was made that he was buying the land for someone else, that the conveyance should run to him and his partner, and that they would convey the land to the purchaser. The testimony shows that on the 19th day of September, 1907, one of the plaintiffs called upon defendant at his office in Colfax, to ascertain whether he (defendant) could buy the land for the plaintiffs. After some negotiations, defendant undertook to purchase the land, and the following is some of the testimony with reference to this agreement:

I said to him (Mr. Hahn), 'You go and buy that land as cheap as you can, and make as good terms as you can,' but that we would pay $ 80 an acre, but that he should buy it as cheap as he could, and make the terms as good as he could make them; and he said, 'All right, I will do it; I will go out and see Mr. Zachary; I will make the terms as good for you boys as I can.' He said, 'I want to get away today; this is Friday, and I want to get back Sunday.' He said, 'You get your draft for a thousand dollars at once.' There was nothing said about a contract up to that time. After I got the $ 1,000 draft, it was along late in the evening, along about 6 o'clock, and after he had receipted for the $ 1,000 he said, 'Boys, I ought to have a contract for this farm.' I said, 'All right.' Then we made the contract. After the contract was made, he said, 'Boys, if I do not buy this for $ 80 an acre, you will not hold me to the contract?' I said, 'Certainly not,' and replied, 'If you can buy it for less, you will buy it for less?' He said, 'Certainly.' That statement was made after the written contract was made. Exhibit B, Robinson, is the contract that was executed at that time. Mr. Hahn went to Pueblo, Colo. I saw him start. We had a conversation with him after he returned from Colorado in regard to this matter, in Colfax, on the following Monday, the 22d or 23d. I said to him, 'What do you want of me?' and he said he had bought it. I ask him how, and he said at $ 80 an acre; that he had stayed there until 2 o'clock at night, and that was the best he could do. He further said that there would have to be a change made in the contract; that he would have to pay a thousand dollars more down, and that the rate of interest would be raised; that if we would make it an all cash payment before a certain time we would be allowed $ 300 off. Another contract was drawn at that time. Mr. Hahn drew it. Exhibit C, Robinson, is the contract that was drawn and signed on the 23d day of September, 1907, by myself and Mr. Hahn. I believed at that time the statements made to me by Mr. Hahn, to the effect that he had been obliged to pay $ 80 an acre for the land, and relied on them; if I had known his statements to be false, and had known that he had agreed to pay only $ 75 an acre for the land, I would not have entered into the second contract. Deeds were afterwards made for the land. The consideration paid for the land was $ 25,600, or $ 80 an acre. The money was paid as follows: $ 2,000 to Hahn; $ 1,000 for possession paid to Cross and myself; $ 2,880 for two notes (they were the rent notes that we had given to Mr. Zachary, and he had sold them to the Valley National Bank of Des Moines, Iowa); $ 530 to Meredith & Son; there was $ 3,300 and some odd dollars that was adjusted through Hahn; then there was $ 13,500 Allfree mortgage on this land, and that brought it down to $ 3,300 and some odd dollars; I do not remember just how much. We (Ed Cross and myself) had the place rented, and had given our notes for three years. I had put something like $ 375 of improvements on the place, and Ed Cross had put something like $ 200 worth of improvements on the farm, and of course we could not let the place go for nothing. The $ 1,000 was paid to cover these improvements. The $ 530 paid to Meredith & Son was for a mortgage on the place. The $ 13,500 to Allfree was a mortgage we put on the place; that was so we could pay cash for the place, and we put a mortgage of $ 13,500. The money we received on that mortgage was paid to Mr. Hahn, and as a matter of fact he received that money. There was $ 105 of taxes paid, and a mortgage of $ 2,732.64 to the Security Loan & Trust Company of Des Moines, Iowa. As a matter of fact, we paid $ 25,600 for the premises, less $ 1,000 allowed us for possession. Exhibit D, Robinson, is in the handwriting of Mr. Hahn, and it represents the settlement for the farm between Mr. Hahn, L. L. Lavalleur, and myself. I did not know at the time of the settlement for the farm that Hahn had purchased the farm for less than $ 80 an acre. He had told me that he paid $ 80 an acre. The first that I had learned that he had purchased the land for less than $ 80 was probably along in April, 1908. I suspicioned there was something wrong when we were making settlement. I could not get anything out of Hahn. The date of the settlement and the date of the memorandum was, I think, March 9, 1908.

Another witness by the name of Cross testified as follows:

I was with Horace Lavalleur at the office of J. H. Hahn, in Colfax, on the 19th day of September, 1907, and heard some of the conversation between Lavalleur and Hahn at that time, with reference to the land in controversy. . . . Mr. Hahn said that he would go out and buy the land as cheap as he could. He said he would go out that evening, and wanted a thousand dollars to take with him to make the purchase. He said, 'I will go out and work in your interest (Horace and L. L. Lavalleur's), and I will buy the land as cheap as I can, and make as good terms as I can.' He said, 'Of course, I will buy it in Mr. Stouffer's and my name, so Mr. Zachary won't know I am getting the land for you, as he might not allow the $ 1,000 for giving possession.' Exhibit B, Robinson, was signed by the parties at that time. When that was signed, Mr. Hahn said, 'Now, if I do not buy the land for you boys, you will not hold me to this contract? and they said, 'Certainly not;' that they would not do that. Nothing that I remember was said by Mr. Hahn that he would not hold Lavalleur to the contract in case he could buy the land for less than $ 80 an acre. This took place after the contract was signed. The statement of Mr. Hahn that he would buy the land as cheaply as possible took place at the same time as the other conversation. It was at the time they gave him the $ 1,000 draft, the same day.

The other plaintiff testified:

I was present in his office in Colfax, Iowa on the 19th day of September, 1907, and took part in the conversation. . . . Mr Hahn said, 'I will go out and try to buy this land for you boys as cheap as I can. If I can not buy the farm for less than $ 80 an acre, then you will give $ 80?' We said that was all right, and we went over to the bank to get a draft for $ 1,000. He said, 'Boys, I will go out and work in your interests, and buy the land for you as cheap as I can; if I can buy the land for less than $ 80, I will do it; but if I can not, I will give $ 80.' We said that was all right, and for him to buy it as cheap as he could, and he said he would do it. This conversation was after the signing of the contract (Exhibit B, Robinson). Of course, it had been talked before the contract was signed, and afterwards, too. Hahn said, 'Boys, I will go out and work in your interests; if I can not get the land for $ 80 an acre, you will not hold me to this?' and we told him, 'No.' Mr. Hahn said that he was going to see L. E. Zachary in Colorado about the purchase of the land. I saw Mr. Hahn after he returned from Colorado, at my residence in Ira, Iowa. Horace Lavalleur was with him. They drove into my place. I was out in the field somewhere, and they called me, and I went where they were. Hahn said, 'Well, I got the farm.' I said, 'Did you?' and he said, 'I got...