Leigh v. Swartz
| Decision Date | 26 May 1952 |
| Docket Number | No. 5521,5521 |
| Citation | 74 Ariz. 108,245 P.2d 262 |
| Parties | LEIGH et al. v. SWARTZ. |
| Court | Arizona Supreme Court |
Carlos G. Robles and Krucker & Evans, all of Tucson, for appellants.
James Elliott Dunseath, of Tucson, for appellee.
This is an appeal by defendants, Joe Leigh and Harry R. Brown, from that portion of the judgment of the lower court awarding plaintiff (appellee), Le Verta W. Swartz, $9,000 as damages for alleged fraudulent representations of the defendants in connection with a certain real estate transaction. The parties having expressly waived a jury, the matter was tried to the court and after a three day trial, it made findings of fact and conclusions of law before entering judgment quieting title and awarding damages.
The facts in the case are quite complicated and we are presented with a voluminous transcript in addition to numerous exhibits. One wanders as in a maze at the finagling of defendant Leigh in this matter. The record presents a confusing and baffling network of high finance in his dealings with the plaintiff Swartz that far outstrips that shown in the related case of Leigh v. Loyd, 74 Ariz. 84, 244 P.2d 356.
The pertinent facts, stated in a light most favorable to sustaining the judgment, are as follows: In March or April of 1947, the defendant Brown acquired title to the realty and improvements known as La Fiesta Restaurant, 2834 E. Grant Road, Tucson, Arizona, from Maude Bevel. He assumed three realty mortgages on the property, a chattel mortgage against the equipment, and paid Miss Bevel $3,200 in cash. A short time later he entered into a partnership with John R. Troxell who assumed one-half of the existing obligations and paid Brown $3,400. They operated the restaurant for about a year, and because business was bad, listed the property with the defendant Joe Leigh, a real estate broker, for sale. Brown then went to work for Leigh as a real estate salesman.
About a month after the listing, Leigh and Brown decided to convert the property into a rest home and Leigh purchased Troxell's partnership interest for $1,000. Legal title was conveyed to one Ray Humblen to hold for the defendants. They then refinanced the third mortgage and gave the new mortgagee a $1,000 bonus. To obtain the money to remodel and convert the property into a rest home, another mortgage was placed on it for $2,500.
During a visit to Tucson in March 1947, Mrs. Swartz, a widow 64 years of age and without any previous business experience discussed with Leigh the possibility of investing the proceeds from the sale of her home in Williamsport, Pennsylvania. She returned to Williamsport and Leigh wrote to her about the property here in question and suggested that it would be a good investment. She sold her home and moved to Tucson, arriving there the first part of December, 1948. Shortly thereafter Leigh contacted her about buying a half interest in the property for $20,000. He represented to her that he was the sole owner, that it was worth $50,000, that it was fully equipped (with the exception of a few pots and pans) to operate a rest home or a maternity hospital, and that it would rent the next five years for at least $700 per month. No mention was made of the liens or encumbrances on the property which amounted to over $17,000.
The deal was closed on December 8, 1948, when Mrs. Swartz paid Leigh $10,000 in cash and agreed to pay the balance of $10,000 from her half of the income from the property. Ray Hamblen conveyed the full legal title to Mrs. Swartz, who simultaneously executed a deed to a one-half interest to Leigh and he executed a deed to Brown for a one-quarter interest. The Leigh and Brown deeds were not recorded until two days before this trial began but were placed in escrow with a title insurance company.
Mrs. Swartz, on December 8th, executed a lease on the property for five years at a monthly rental of $700 per month. During the next few months, Mrs. Swartz, at the direction of Leigh, also executed various legal documents including two realty mortgages as security for the sum of $26,000 which was used to pay off the previous obligations and the expenses of remodeling. The rent on the above lease, due to remodeling of the property, did not start until April of 1949, and in September of the same year the tenants were financially unable to continue and vacated the premises. Leigh received the advance payment of $2,100 on the lease and the rent for April and May of 1949 (without distributing to Mrs. Swartz and Brown their share), at which time the plaintiff became dissatisfied, consulted a lawyer and on his advice took over the active management of the property and the collection of the rents. The latter part of September 1949, Mrs. Swartz then leased the property to the Tucson General Hospital for two years at $525 per month.
Mrs. Swartz started this action in September of 1949, praying for an accounting and that legal title to the premises be quieted in her. At the end of the trial the plaintiff presented a motion to amend the complaint to include damages for the alleged fraudulent representations of the defendants. The court quieted title to a one-half interest in the plaintiff and a one- quarter interest in each of the defendants. The court also found a one-half interest in the property at the time of the sale, after deducting the existing encumbrances, to be worth $6,000 and assessed plaintiff's damages at $9,000. After denial of their motion for a new trial this appeal was taken.
The defendants contend very strenuously that the trial court erred in permitting the amendment of the complaint after the trial had been completed, on the grounds that it set forth a new cause of action, changed the issues from a suit in equity to a legal action and it deprived them of a right to trial by jury.
Amendments to conform to the evidence under section 21-449, A.C.A.1939, Rule 15(b) should be liberally allowed in the interest of justice and are within the discretion of the trial court. Aiken v. Portis, 59 Ariz. 101, 123 P.2d 169; Sanders v. Brown, 73 Ariz. 116, 238 P.2d 941. The spirit and purpose of allowing these amendments is for the case to be ultimately tried on its merits so that the parties to the litigation, in one trial, will receive all the relief to which they are entitled. Therefore if evidence is presented in the trial of a case which presents a new or different theory from that alleged in the pleadings, and the adverse party does not object to the introduction of that evidence, that issue is then tried by implied consent and the pleadings, upon request of counsel, should be amended to conform to the evidence.
We have carefully reviewed the record in the instant case and suffice it to say that we are satisfied that the evidence introduced without objection at the trial would support a pleading alleging fraudulent representations. All the elements are present including the damages and the value of the property at the time of the sale to Mrs. Swartz. We find no abuse of discretion by the trial court in allowing the amendment to the complaint.
Nor is there any merit to the contention that the defendants were deprived of the right to a jury trial of the damage issue. The minutes show that originally a jury was demanded, but the judgment recites that at the beginning of the trial a jury was expressly waived by the parties and the case went to trial before the court without a jury. During the course of the trial the record is silent as to any demand by the defendants for a jury to try such issues and in fact no such demand was thereafter made to the trial court. It was only after the trial had ended and the court had permitted the pleadings to be amended to correspond to the proof adduced and judgment was entered that the defendants, on motions for a new trial, injected this argument. While the right to trial by jury remains inviolate in this state, demand for the same must be timely made or it is deemed to have been waived.
The cases relied upon by defendants such as Columbia River Packers Ass'n v. Hinton, D.C., 34 F.Supp. 970, 978, are, we believe, readily distinguishable upon the facts. To have granted a trial by jury at this time would have meant a complete retrial of the entire case with all the attendant expense and time-consuming delay. In this case the demand for a jury was too late, as unquestionably the issue of fraudulent representations as to the property values...
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...than he paid.' Evidence admissible for one purpose is not to be excluded because inadmissible for another purpose. Leigh v. Swartz, 74 Ariz. 108, 114; 245 P.2d 262, 266. The question of admission is one involving the discretion of the court and the decision of the court will not be disturbe......
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