McClure v. Campbell

• Decision Date: 15 February 1899
• Parties: McCLURE v. CAMPBELL.
• Court: Missouri Supreme Court

49 S.W. 881

148 Mo. 96

McCLURE v. CAMPBELL.

Supreme Court of Missouri, Division No. 1.

February 15, 1899.

FRAUD — WHAT CONSTITUTES — EVIDENCE — INSTRUCTIONS — NONSUIT — APPEAL.

1. Where the lessor of land issues to the lessee, who agrees to erect a building thereon, a receipt for the first year's rent, which, however, was not paid, he does not thereby give the lessee a fictitious credit; and it cannot be said that a builder relied thereon in making a contract with the lessee to erect the building, so as to enable the builder to recover of the lessor, as for fraud, damages resulting from the fact that the building is not erected, and the lessee proves irresponsible.

2. A lessee of land agreed to erect a building thereon, of a certain value. The lessor signed a contract acknowledging that the lessee had deposited with him a certain sum to guaranty faithful performance; and stating that such sum should be repaid the lessee when the building was completed, and when there should be shown the architect's certificate that it was of the required value, and vouchers that all claims were paid, and further stating that the sum was not to be used to complete the building, and that no contractor should have any claim thereon. The contract was shown a builder, who, after being told by the lessor's agent that the sum was actually deposited, made a contract with the lessee to erect a building to cost considerable less than the required sum. After work was begun, the land was discovered to be too small for the building, and work was stopped. The sum had not in fact been deposited, and, the lessee being worthless, the builder sued the lessor for deceit. Held not to show that the lessor represented that the sum was deposited as security that final payments on the building should be made to contractors.

3. Where the court announces that it will grant an instruction sustaining defendant's demurrer to the evidence, and plaintiff thereupon asks leave to take a nonsuit, which the court grants, and no instruction is in fact "given" as required by Rev. St. 1889, § 2188, there has been no ruling or action of the court with respect to the instruction, and the nonsuit is voluntary.

Appeal from St. Louis circuit court; Thomas A. Russell, Judge.

Action by Richard P. McClure against James A. Campbell. From judgment of nonsuit plaintiff appeals. Affirmed.

The material allegations of the petition are these: Plaintiff is a builder and contractor. Defendant was during the year 1895 the owner of the following described real estate in the city of St. Louis: "In city block No. 520 of said city and state, and lying on the north line of Washington avenue, 146 8/12 feet west of Thirteenth street; thence west 146 11¼-12 feet; thence north, parallel with the east line of the Finney tract, 133 feet, to south line of Lucas avenue; thence east to a point on the south line of Lucas avenue 119 7/12 feet west of Thirteenth street; thence south, and parallel to the east line of Finney tract, to point of beginning;" said property being unimproved. That about the 1st of May, 1895, defendant conceived the idea of having the property improved, without being personally responsible for the expense, and without rendering the real estate liable to mechanics' liens. That, in pursuance to that intent, defendant entered into an agreement with one W. J. McBride by which he agreed to pay McBride a large sum of money, if he would obtain a lessee who should obtain a responsible bidder to erect a building on the premises according to plans to be approved by defendant. That McBride procured one Ensley O. Whistler, who was known to defendant to be an impecunious and irresponsible adventurer from Chicago, who agreed with defendant to lease the premises at a rental of $12,000 a year, and to erect a bachelor apartment house, to cost about $65,000, and the lease was accordingly executed to Whistler; and defendant caused it to be circulated among the real-estate men and builders that Whistler had paid him $12,000 for the first year's rent, in advance, and had paid him $25,000 in cash "as a security or indemnity that the final payments on the construction should be paid to contractors and material men." That defendant gave Whistler receipts for said sums of money, "with intent that said Whistler should exhibit said receipts to contractors and builders, to create confidence in said Whistler as a man of means and ability to carry out any contract he might make for the erection of said building." That Whistler exhibited the receipts, and claimed he had made the deposits. That Whistler caused plans to be prepared for the building, which were approved by defendant. That, "having been informed that said sums of twenty-five thousand dollars and twelve thousand dollars were actually deposited in cash with said Campbell for the purposes hereinbefore set forth," plaintiff bid for the construction of the building, and was awarded the contract; but before signing the contract, and for the purpose of verifying the deposit and payment stated, he applied to defendant's general agent (the defendant himself being absent from the city of St. Louis), and was informed that the deposit and payment had actually been made, and upon this "assurance" he signed a contract for the construction of the building for $65,685, proceeded to order materials for the building, and made the excavation for the foundation, but that it was then discovered that defendant did not have sufficient land, by about five feet, on which to construct such a building as was contemplated by the plans, and thereupon the architect ordered the work stopped, and Whistler abandoned the work of construction and returned to Chicago. That plaintiff then ascertained that Whistler was financially irresponsible, and "had been relying on obtaining a loan on his leasehold for the first payments for said work, and on said Campbell, who had promised to pay the last twenty-five thousand dollars required for the construction," but that Whistler had been unable to borrow any money on the leasehold. That plaintiff then learned from defendant's agent (defendant being still absent from St. Louis) that said sums of money had not been paid or deposited by Whistler with defendant; and plaintiff therefore charges the fact to be that the receipts were given to Whistler to give him a false and fictitious credit, and to enable him to thereby induce contractors to enter into contracts for the construction of the building. That plaintiff's contract with Whistler provided that when the third-floor joists were laid a payment of $20,000 was to be made. That plaintiff did work and incurred liabilities for materials amounting to $3,400, and that his profits on the job would have amounted to $6,500, and he asked a judgment for $9,900. The answer is a general denial.

The evidence introduced by plaintiff in support of these allegations was: That defendant executed a 99-year lease on the premises to Whistler, at a yearly rental of $12,000, the lessee agreeing to erect two buildings, to cost not less than $75,000, according to plans to be approved by defendant. That defendant agreed to pay McBride $25,000 as commissions for effecting the lease, when the buildings were completed. That defendant gave Whistler a receipt for the first year's rent, and also a receipt and agreement, which Whistler's attorney had prepared, in the following form:

"I, James Campbell, of the city of St. Louis, in the state of Missouri, hereby certify and acknowledge that Ensley O. Whistler, of the same place, has this day deposited with me the sum of twenty-five thousand dollars ($25,000), in lawful money of the United States of America, for the following purposes, to wit: Whereas, by an indenture of lease dated this first day of June, 1895, I did demise and lease unto the said Ensley O. Whistler, for the term of ninety-nine (99) years from and after the first day of June, 1895, upon the terms and conditions therein mentioned and recited, the following described premises, situated in the city of St. Louis, in the state of Missouri, to wit: * * * And whereas, as one of the covenants and conditions of said lease, it is provided that the said Ensley O. Whistler shall erect upon said premises two (2) substantial brick buildings, one at least five (5) stories and basement in height, and one at least three (3) stories in height, to cost together not less than seventy-five thousand ($75,000) dollars, and shall have said buildings completed and ready for occupancy on or before the first day of January, 1896, and free from mechanics', laborers', material men's, and all other liens for work and labor done upon, and material furnished to, said buildings; and whereas, said deposit of said sum of twenty-five thousand ($25,000) dollars has so been made with me by said Ensley O. Whistler for the purpose of assuring and guarantying to me, my heirs and assigns, the faithful performance and fulfillment by the said Ensley O. Whistler, his heirs or assigns, of the aforesaid covenant and condition: Now, therefore, if the said Ensley O. Whistler, his heirs, or assigns, shall on or before the first day of January, 1896 (strikes and unavoidable accidents excepted), have erected on the hereinbefore described premises two (2) buildings as hereinbefore mentioned and referred to, and in accordance with plans and specifications now approved by me, and shall on or before said date (strikes and unavoidable accidents excepted) have said buildings completed and ready for occupancy, and when architect or architects of said buildings shall have certified that the reasonable cost of said buildings, when completed, is not less than seventy-five thousand ($75,000) dollars, and when proper vouchers of the contractors and all subcontractors for work and labor done upon, and materials furnished to, said buildings, when completed, shall have been exhibited by the said Ensley O. Whistler, his heirs, executors, administrators,...