McKnight v. Thompson

• Decision Date: 21 March 1894
• Citation: 58 N.W. 453,39 Neb. 752
• Parties: MCKNIGHT v. THOMPSON ET AL.
• Court: Nebraska Supreme Court

39 Neb. 752

58 N.W. 453

MCKNIGHT

v.THOMPSON ET AL.

Supreme Court of Nebraska.

March 21, 1894.

Syllabus by the Court.

1. Ordinarily, a mere misrepresentation of the value of real estate which is the subject-matter of the contract is not actionable, although falsely and fraudulently made by the seller and relied upon by the buyer.

2. The rule is otherwise where the purchaser resides a considerable distance from the location of the land, is ignorant of its value, and is prevented from examining the property or from making inquiries as to its condition and value by trick or fraud of the vendor.

Error to district court, Hitchcock county; Cochran, Judge.

Action by Aaron McKnight against John Cruts and Samuel Thompson to rescind a contract. There was judgment for defendants, dismissing the action on demurrer to petition, and plaintiff brings error. Reversed.J. W. Cole, for plaintiff in error.

J. Byron Jennings, for defendants in error.

NORVAL, C. J.

Aaron McKnight traded to Samuel Thompson and John Cruts a stallion, and took in exchange therefor three lots in the city of Topeka, Kan. McKnight brought this action in the lower court for a rescission of the contract, or, if rescission cannot be had, for damages on account of alleged fraudulent representations of the defendants in the trade of the lots. The district court sustained a general demurrer to the petition, and dismissed the action; to reverse which ruling, plaintiff brings the case here on error. The petition charges among other things, in substance, that on the 25th day of March, 1890, the defendants, conspiring and confederating together to cheat and defraud plaintiff, represented that the defendant Thompson was the owner of lots 299, 297, and 301 on Kolon avenue, Jenkins M. Morris' Addition to the city of Topeka, Kan., and, for the purpose of inducing plaintiff to trade for said lots, defendants represented to plaintiff that said lots were of the value of $1,000, and that they were incumbered for the sum of $650, and no more; that defendants, for the purpose of inducing plaintiff to rely upon their statements as to the value of said lots, read and delivered to plaintiff a letter bearing date of January 7, 1890, purporting to have been written by one V. Franklin, of the Citizens' Bank of McCook, Neb., to the First National Bank of Topeka, Kan., inquiring as to the value of said lots, with the pretended answer thereto of the cashier of the said First National Bank; that said pretended answer placed the value of said lots at $350 to $400 each. The petition further charges that said representations and statements of the defendants were false and untrue, and were known to be such by the defendants when made; that said lots were of no value whatever over and above the mortgage incumbrance thereon of $650; that, instead of the value of said lots having been placed at $350 to $400 each by said cashier in his said letter, their value was stated by him to be from $150 to $200 each, but that said defendants, for the purpose of defrauding plaintiff, changed and raised said figures; that plaintiff had never seen said lots, and was wholly ignorant of their value, but that relying entirely upon the said statements and representations of the defendants, and believing the same to be true, and that said letter of the cashier was genuine, and not forged, plaintiff was induced to and did give defendants in exchange for said lots a stallion of the value of $500, and assumed and agreed to pay said incumbrance of $650 on said real estate.

The question presented for our consideration is whether the petition was sufficient to entitle plaintiff to the relief demanded. Usually a mere assertion concerning the value of property made by the vendor is not actionable, although known by him to be untrue. In other words, a charge of fraud can seldom be predicated on the mere expression of an opinion, and representations or statements of the value of property are generally regarded as of that character, and a vendee is not ordinarily warranted in placing any confidence in them. Such is undoubtedly the rule where the buyer is acquainted with the...