McElrath v. Electric Investments Co.

• Decision Date: 19 May 1911
• Docket Number: 17,009 - (108)
• Citation: 131 N.W. 380,114 Minn. 358
• Parties: ULYSSES G. McELRATH and Another v. ELECTRIC INVESTMENTS COMPANY
• Court: Minnesota Supreme Court

131 N.W. 380

114 Minn. 358

ULYSSES G. McELRATH and Another v. ELECTRIC INVESTMENTS COMPANY

Nos. 17,009 - (108)

Supreme Court of Minnesota

May 19, 1911

Action in the district court for Hennepin county to recover $3,780 for fraudulent statements alleged to have been made for the purpose of inducing plaintiffs to enter into a lease of certain property. From an order, Dickinson, J., overruling defendant's demurrer to the complaint, it appealed. Affirmed.

SYLLABUS

False representations.

False representations, known to be false, that certain events will be brought about in the future, if intended to create the belief that it was the then intention to bring them about and be so understood and relied upon, may be made the basis of an action for fraud and deceit.

Complaint sufficient.

Allegations of the complaint construed, and held, in part, to state a cause of action.

Boutelle & Chase and R. T. Boardman, for appellant.

Jesse Van Valkenburg, for respondents.

OPINION

BROWN J.

Appeal from an order overruling a general demurrer to plaintiffs' complaint. It appears from the complaint that the defendant was the owner of a certain summer hotel property, including the land upon which the building was situated, and certain personal property used in connection with the operation of the hotel, situated at Antlers Park, in Dakota county. On April 15, 1909, the parties to the action entered into a contract by the terms of which defendant leased the property to plaintiffs for a term of years. The terms and conditions of the lease were fully set forth in the written contract, which was duly executed by both parties, and required of plaintiffs the payment of specified amounts semiannually, and that the hotel be conducted along certain specified lines.

The action is for damages occasioned by the alleged false and fraudulent representations made by defendant for the purpose of inducing plaintiffs to enter into the contract. The complaint alleges:

"That for the purpose of inducing said plaintiffs to enter into said contract, Exhibit A, this defendant wrongfully, falsely, and fraudulently stated and represented to these plaintiffs that Minneapolis, St. Paul, Rochester & Dubuque Electric Traction Company would complete its electric railroad, and would run electric cars over said road from the city of Minneapolis to and beyond said Antlers Park during the summer of 1909, and about July first of that year; and said defendant further stated and represented to said plaintiffs that said defendant would, during said summer of 1909 and as soon as said electric railroad should run to said Antlers Park, make of said Antlers Park and surrounding ground an important summer resort for people living at said city of Minneapolis, and further stated and represented to plaintiffs that if they would enter into said contract, Exhibit A, and undertake the running of a hotel upon said Antlers Park, as more fully set forth in said Exhibit A, they would make, through the assistance and efforts of said defendant, not less than fifteen hundred dollars ($1,500.00) per annum clear above all expenses of running and management.

"That each of said statements and representations were false and fraudulent, and made for the sole purpose of inducing said plaintiffs to enter into said contract, Exhibit A, and that said statements and representations were known to said defendant to be false at the time of making the same. That said plaintiffs believed said representations and statements to be true, and relied thereupon, and entered into said contract, Exhibit A, solely because they believed and relied upon said statements, and not otherwise."

It also alleges that at the time the contract was entered into the...