Linton v. Sheldon

• Decision Date: 30 October 1915
• Docket Number: No. 18316.,18316.
• Parties: LINTON ET AL. v. SHELDON.
• Court: Nebraska Supreme Court

98 Neb. 834

154 N.W. 724

LINTON ET AL.

v.SHELDON.

No. 18316.

Supreme Court of Nebraska.

Oct. 30, 1915.

Syllabus by the Court.

A contract procured by the intentional suppression or concealment of material facts touching the very substance of it by one party, which facts, if they had been disclosed, would have prevented the other party from entering into it, may be rescinded by the party deceived, and the guilty party is not entitled to its enforcement.

Appeal from District Court, Douglas County; Sutton, Judge.

Action by Adolphus F. Linton and others against George Sheldon. From judgment for defendant, plaintiffs appeal. Affirmed.Charles Haffke and Stout, Rose & Wells, all of Omaha, for appellants.

Sullivan & Rait, of Omaha, for appellee.

LETTON, J.

This action is brought to recover the sum of $1,800 alleged to be due plaintiffs upon a contract for the sale of 80 acres of land in Cass county by Adolphus F. Linton, Phœbe R. E. E. Linton, Charles S. Linton, and Fryda S. Blessing to one Harshman. Adolphus and Phœbe Linton are husband and wife, and Charles S. Linton and Fryda S. Blessing are their adult children. It is alleged that the agreement was that the conveyance was to be in form sufficient to vest Harshman with the title to the land, of which one Jane B. Finlay died seised, and to be of form approved by Hon. John J. Sullivan; that the defendant, who held a mortgage on the land, agreed with the plaintiffs to pay the sum stipulated in the contract; that the plaintiffs complied with all its terms and conditions, and defendant refused to carry out the agreement, and is liable for the contract price.

The answer pleads that the petition does not state a cause of action against Sheldon, and that if the plaintiffs have any remedy it is against Harshman. It also pleads that in 1887 Adolphus F. and Phœbe R. E. E. Linton conveyed the same land to Harshman by warranty deed, and that by reason of a certain decree rendered in the United States Circuit Court for the Western District of Pennsylvania, and a conveyance made thereunder, the grantors had at that time a perfect title, which Harshman took. It is alleged that at the time the contract in suit was entered into the plaintiffs knew these facts, but fraudulently concealed and suppressed the truth, and falsely represented that the title was defective, and that Charles S. Linton and Fryda S. Blessing owned the fee, subject to the life estate of their mother, Phœbe R. E. E. Linton; that Harshman and defendant were ignorant of the existence of this decree and conveyance when the contract was executed; that as soon as this fact was ascertained they notified the plaintiff that the contract would not be performed. It also pleads that defendant acted in all things for Harshman, and undertook to advance the money only as his agent and for his benefit.

The reply pleads that there was an honest dispute as to the title, denies the allegations of fraud and concealment, and alleges that the contract was entered into as a compromise and settlement of the dispute. At the close of the testimony each party moved for a directed verdict in his favor. This submitted the whole case to the trial judge for decision as to both fact and law. Segear v. Westcott, 83 Neb. 515, 120 N. W. 170;Dorsey v. Wellman, 85 Neb. 262, 122 N. W. 989;Henton v. Sovereign Camp W. O. W., 87 Neb. 552, 127 N. W. 869, 138 Am. St. Rep. 500;Martin v. Harvey, 89 Neb. 173, 130 N. W. 1039;Adler v. Royal Neighbors of America, 90 Neb. 56, 132 N. W. 716, Ann. Cas. 1912D, 974;Fassler v. Streit, 92 Neb. 786, 139 N. W. 628; Fairbanks, Morse & Co. v. Austin, 96 Neb. 137, 147 N. W. 126, 148 N. W. 332. A verdict was directed for defendant, and plaintiffs appeal.

In 1887 P. R. E. Elwina Linton and A. F. Linton, her husband, by their attorney in fact, J. B. Finlay, executed in Pennsylvania a warranty deed to George W. Harshman to this 80 acres of land in Cass county, Neb. Harshmen entered into possession under the deed, and was still in posession in May, 1910, when Charles Haffke, an attorney of Omaha, notified him that the owner of the land had placed in his charge the matter of securing possession of the property, saying in his letter:

“This property was alleged to have been conveyed to you by J. B. Finlay, acting under an alleged power of attorney, which, however, was not a legal or valid conveyance, and the heirs are seeking to recover the possession of their land.”

In the meantime Harshman had executed a mortgage on the land to George Sheldon, the defendant. Negotiations ensued between the Lintons, represented by Mr. Haffke, and Sheldon, acting for Harshman, which resulted in the contract in suit, whereby the four Lintons agreed to sell and convey the land to Harshman--

“conveyance to be in form sufficient to vest in the second party the title of which Jane B. Finlay, late of Kittanning borough, Penn., died seised, and in form approved by Hon. John J. Sullivan, attorney, of Omaha, Neb. * * * In consideration of such conveyances, the second party agrees to pay the first parties the sum of $1,800 upon the delivery to and approval by said Sullivan of the form of deed of conveyance.”

This was signed by Haffke, as attorney in fact for the Lintons, and by Mr. Harshman. Sheldon did not sign. Mr. Haffke testifies that Mr. Sheldon was present at the time this contract was made, and said--

“that he was going to advance the money for the purpose of...