Lubbe v. Barba, 7778
| Decision Date | 29 September 1975 |
| Docket Number | No. 7778,7778 |
| Citation | 91 Nev. 596,540 P.2d 115 |
| Parties | Bruno LUBBE and Helen Lubbe, Appellants, v. John Joseph BARBA and Margaret Janet Barba, Respondents. |
| Court | Nevada Supreme Court |
Lance R. VanLydegraf, Reno, for appellants.
Paul A. Richards, Reno, for respondents.
On October 18, 1972, George Silknitter, a real estate salesman for Ryan Realty, Inc., exhibited to respondents property known as 'Sky Lake Inn,' owned by appellants and located on Mt. Rose Highway in Washoe County, Nevada. Respondents and Silknitter arrived at the property at about 3:30 a.m. and entered the building with a key which had been previously furnished by appellants. They inspected the second floor of the premises and about 5:30 a.m. went downstairs and awoke appellants.
Silknitter prepared an offer and acceptance agreement. During this time appellants revealed to respondents that a section of the asbestos shingles was missing and a few windows were broken. At the request of both parties, an 'as is' condition was inserted into the offer and acceptance agreement. Mr. Barba and Mrs. Lubbe signed the agreement. Mr. Lubbe refused to sign. Respondents then made a deposit of $5,000 with appellants.
On November 6, 1972, appellants executed escrow instructions for the sale of the property to respondents at the appraised price of $72,000. Respondents made a down payment of $10,000, assumed the payment of the balance due on a promissory note secured by a first deed of trust, and executed a promissory note in the amount of $38,000, secured by a second deed of trust. After escrow closed respondents applied for a restaurant business license and discovered that certain corrections were necessary in the sewer system. Upon this discovery they refused to make any payments to appellants on their promissory note. As a result appellants filed and served a notice of default and election to sell under the second trust deed. Respondents countered with an action for damages and alleged, among other things, that they intentionally misled respondents and misrepresented the property.
The trial court issued a temporary restraining order followed by a preliminary injunction preventing any foreclosure sale of the property. After a trial without a jury the district court found that: 'The Lubbes did make certain representations with relation to the septic system in that the same was adequate for the premises, which representation was false in that the septic tank was inadequate, and the Barbas relied upon said representation all to their damage in the sum of $9,400.00.' The judgment, from which this appeal is taken, was entered accordingly.
Appellants contend (1) that there is insufficient evidence to support the finding of intentional fraudulent misrepresentation; (2) that the trial court erred in admitting evidence to prove what the parties meant by the 'as is' condition in the original agreement, and by failing to affirmatively state in its finding of fact that (1) the false representations were knowingly made by the defendants; (2) fraud was produced by clear and convincing evidence, and, (3) reliance was shown on the part of the respondents.
Here the burden was upon the respondents as the plaintiffs in the action to support their contention of fraud by clear and convincing proof. Clark Sanitation, Inc. v. Sun Valley Disposal Co., 87 Nev. 338, 487 P.2d 337 (1971), and cases cited therein. In Clark Sanitation, supra, we said: 87 Nev. at 341, 487 P.2d at 339.
A false representation made by the defendant, knowledge or belief on the part of the defendant that the representation is false--or, that he has not a sufficient basis of information to make it, an intention to induce the plaintiff to act or to refrain from acting in reliance upon the misrepresentation, justifiable reliance upon the representation on the part of the plaintiff in taking action or refraining from it, and damage to the...
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