McMahon v. M & D Builders, Inc.

• Decision Date: 20 June 1971
• Citation: 271 N.E.2d 649,360 Mass. 54
• Parties: Thomas J. McHAHON et al. v. M & D BUILDERS, INC.
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court

Page 649

271 N.E.2d 649

360 Mass. 54

Thomas J. McHAHON et al. v. M & D BUILDERS, INC.

Supreme Judicial Court of Massachusetts, Norfolk.

Argued April 7, 1971.

Decided June 20, 1971.

Ralph C. Copeland, Wellesley, for plaintiffs.

Peter C. Huckins, Sharon, for defendant.

Before TAURO, C.J., and SPIEGEL, REARDON, QUIRICO and BRAUCHER, JJ.

QUIRICO, Justice.

This is a bill in equity in which the plaintiffs seek to rescind their purchase of a house and lot from the defendant on the grounds of: (a) false and fraudulent representations made by the defendant concerning the house to procure and induce the plaintiffs to purchase it, (b) breach of implied warranties by the defendant that the house was free from major and structural defects, that it was built in a good and workmanlike manner and that it was suitable for habitation, and (c) breach of an implied warranty by the defendant that the house complied with the building code of the town in which it was located. The case is before us on the appeal of the plaintiffs from a final decree dismissing their bill.

The case is presented to us on an agreed record on appeal under S.J.C. Rule 1:04, 351 Mass. 734--735. The record shows that on July 2, 1970, a judge of the Superior Court allowed the defendant's motion for a final decree and on the same day entered a final decree dismissing the bill. Neither the motion nor the decree is reproduced in the record. The record does not state the grounds for the motion or the basis for the dismissal of the bill. It is only by a reading of the plaintiffs' brief that we are able to learn that the motion was probably filed pursuant to the provisions of G.L. c. 231, § 59, as amended by St.1965, c. 491, § 1, permitting the entry of final decrees on motion therefor in suits in equity where the pleadings and other papers on file 'show affirmatively * * * that no genuine issue of material facts exists and there is nothing to be decided except questions of law, or the form of the decree, or the nature of the relief to be granted.' Rule 1:04 permits 'an agreed record in the form of a statement setting forth only such pleadings, facts, and documents as are essential to the issues to be presented to the full court.' While this rule permits an alternative simplified and abbreviated record on appeal, it still contemplates and requires that a statement of the facts essential to the issues be included in the record. The briefs are no part of the record on appeal. Foley's Case, 344 Mass. 456, 458, 183 N.E.2d 113.

Under § 59, a party to a suit in equity which involves rights under a written contract is entitled to have his motion for entry of a final decree allowed without trial on the merits only 'if admissions in the pleadings, interrogatories or admissions under section sixty-nine, stipulations or affidavits hereunder, show affirmatively * * * that no genuine issue of material facts exists and there is nothing to be decided except questions of law, or the form of the decree, or the nature of the relief to be granted.' We must determine whether the record before us and the inferences which may properly be drawn therefrom, when viewed in their light most favorable to the plaintiffs, show that a 'genuine issue of material facts exists.' The burden is on the defendant as moving party to show that it does not exist. Hub Associates, Inc. v. Goode, 357 Mass. ---, 258 N.E.2d 733. United States v. Diebold, Inc., 369 U.S. 654, 655, 82 S.Ct. 993, 8 L.Ed.2d 176. The standard to be applied in making the determination 'is analogous to that used on a motion for a directed verdict.' American Manufacturers Mut. Ins. Co. v. American Bdcst.-Paramount Theatres, Inc., 388 F.2d 272, 279 (2d Cir.).

We shall summarize the pertinent allegations of the bill and facts stated by the plaintiffs in answers to interrogatories. On June 3, 1969, the parties executed a written agreement by which the defendant agreed to sell and the plaintiffs agreed to buy 'the land and buildings thereon located at No. Lot 48 Forest Street in Medfield, Massachusetts, consisting of approximately 33,623 square feet' for a price of $43,000. At that time the defendant, which was engaged in the business of building and selling houses, was building a house on the lot in question. The house was structurally complete. The exterior and interior painting, landscaping, hanging of interior doors, and installation of electrical appliances and plumbing fixtures had not been completed. The plaintiffs looked at the house on May 31, June 2 and June 3, 1969, and they spoke to the defendant's president, William G. Duhaime, about the house and its construction on all three dates.

The plaintiffs allege in their bill that before they signed the agreement, 'the defendant, its agents, servants or employees represented that the interior walls were of plaster, that the house contained only the best or first class building materials and appliances; and that the house was soundly constructed and built in a workmanlike manner and was suitable for habitation.' They allege further that they relied on these representations, that all of them were false, that the defendant knew or should have known that the representations were false and that they were made with the intent to defraud the plaintiffs.

The plaintiffs contend that the false statements made by the defendant were representations of material facts and therefore, in combination with the additional allegations, are actionable and entitle them to rescind their purchase. The defendant contends that the statements are 'generalities (which) amount only to the usual sales talk between prospective seller and buyer and, therefore, fall within the ordinary rule that 'false statements of opinion, of conditions to exist in the future, or of matters promissory in nature are not actionable. " We recognized in Fogarty v. Van Loan, 344 Mass. 530, 532, 183 N.E.2d 111, 112, that 'the line between what is actionable and what is not in cases of this sort is often difficult to draw.' In the present case the defendant was the builder of the house about which its president made representations to the plaintiffs. The house was almost completed when the statements were made. It had progressed to the point where representations that the interior walls were of plaster, that the house contained only the best or first class materials, and that it was soundly constructed and built in a workmanlike manner were statements of facts which the defendant then represented to exist. They were in no sense statements of opinion, of conditions to exist in the future, or of matters promissory in nature. We hold that they were representations of facts, and that if they were false they were actionable.

This case is governed by our holdings in Kabatchnick v. Hanover-Elm Bldg. Corp., 328 Mass. 341, 343--347, 103 N.E.2d 692; Pietrazak v. McDermott, 341 Mass. 107, 109--110, 167 N.E.2d 166; Powell v. Rasmussen, 355 Mass. 117, 119, 243 N.E.2d 167 and Maxwell v. Ratcliffe, 356 Mass. 560, 562--563, 254 N.E.2d 250, all relating to false representations of facts; and not by our holdings in Yaghsizian v. Saliba, 338 Mass. 794, 155 N.E.2d 874; Yerid v. Mason, 341 Mass. 527, 529--530, 170 N.E.2d 718 and Rogarty v. Van Loan, 344 Mass. 530, 532, 183 N.E.2d 111, all dealing with false statements of opinion, of conditions to exist in the future, or of matters promissory in nature.

The plaintiffs allege that 'the representations made by the defendant * * * were false, which the defendant knew or should have known, and were made with the intent to defraud the plaintiffs.' Despite these broad allegations, the plaintiffs may be entitled to rescind on proof of much less. In Yorke v. Taylor, 332 Mass. 368, 371, 124 N.E.2d 912, 914 the trial judge had found that the defendants had misrepresented the assessed valuation of property being sold, but that they had 'acted in good faith and had no intention of misleading or deceiving the plaintiff.' We said that 'these findings would not defeat the right to rescind. In this Commonwealth one who has been induced to enter into a contract in reliance upon a false though innocent representation of a material fact susceptible of knowledge which was made as of the party's own knowledge and was stated as a fact and not as matter of opinion is entitled to rescission.' Rudnick v. Rudnick, 281 Mass. 205, 208, 183 N.E. 348; Golding v. 108 Longwood Ave. Inc., 325 Mass. 465, 467--468, 91 N.E.2d 342; Enterprises, Inc. v. Cardinale, 331 Mass. 244, 118 N.E.2d 740; Bellefeuille v. Medeiros, 335 Mass. 262, 265, 139 N.E.2d 413.

The plaintiffs devote a portion of their brief to the argument that the 'doctrine of merger' is no bar to the relief which they seek. We assume that they refer to the rule stated in Pybus v. Grasso, 317 Mass. 716, 717, 59 N.E.2d 289, 291, quoting from Restatement: Contracts, § 413, to the effect that 'the acceptance of a deed of conveyance of land from one who has previously contracted to sell it, discharges the contractual duties of the seller to the party so accepting except such as are embodied in the deed * * *.' The defendant does not argue this point in its brief. The sketchy agreed record on appeal does not state the grounds or basis for the judge's entry of a decree dismissing the bill without trial. On the assumption that coverage of the issue by the plaintiffs' brief indicates that it was probably involved in the judge's action, we deal with it briefly. If the question is involved it arises under the following provision of the contract in this case: 'If the seller shall be unable to give title or to make conveyance as above stipulated, any payments made under this agreement shall be refunded, and all other obligations of either party hereunto shall cease. The acceptance of a deed by the Buyer shall be deemed to be a full performance and discharge hereof' (emphasis supplied).

In the Pybus ...