McNulty v. Durham

• Decision Date: 04 June 1917
• Docket Number: 8610.
• Parties: McNULTY v. DURHAM.
• Court: Colorado Supreme Court

167 P. 773

63 Colo. 354

McNULTY v. DURHAM.

No. 8610.

Supreme Court of Colorado, En Banc.

June 4, 1917

Rehearing Denied Oct. 8, 1917.

Error to District Court, Pueblo County; J. E. Rizer, Judge.

Action by S. R. Durham against Charles N. McNulty. Judgment for plaintiff, and defendant brings error. Reversed and remanded.

This action, brought by S. R. Durham, as plaintiff, against Charles N. McNulty, is based on fraud and deceit--alleged misrepresentations--of McNulty, in an oral contract for an exchange of real estate by which Durham gave his house and lot in Pueblo to McNulty for a tract of land in Christian county, Mo. Durham was a practicing attorney in Missouri before coming to Colorado. Defendant was a merchant in the city of Ordway, and the parties were brought together by one Kidder, a real estate agent.

The complaint alleges: That September 19, 1913, McNulty represented to plaintiff that he owned a farm of 80 acres in Christian county, Mo.; that he had fee-simple title, free and clear of all incumbrances, taxes, or other liens, and exhibited an abstract of title in usual form, certified as containing a correct and complete abstract of everything affecting the title; that the last certificate, dated April 28, 1913, certified that the taxes were paid in full, and showed a clear and perfect title to the property in one William Oldfield; that defendant produced and exhibited a warranty deed executed by Oldfield with a blank space left in which to write the name of the grantee, and represented that he had purchased the property from Oldfield and received the deed with full authority to write or have written in the name of any grantee he might wish; that defendant said he had not seen the property himself, and proposed to exchange it for plaintiff's equity in the Pueblo house and lot, which was worth $1,250; that defendant guaranteed the farm was as represented and that no liens had attached since making the abstract; that plaintiff upon inquiry ascertained that defendant was a reliable merchant and business man of Ordway and believing and relying upon the truthfulness of his statements and representations as to the character and title of the farm, as well as upon the genuineness and bona fides of the abstract, he (plaintiff) was induced to make and did make the exchange by delivering a warranty deed of his equity in the Pueblo property to the defendant and receiving in exchange therefor the deed executed by Oldfield. It is then alleged: That at the time of the exchange defendant had no claim, right, title or interest in or to any part of the Missouri farm, neither did Oldfield at the time he executed the deed. That the abstract was in two parts, the first being made by an abstractor named Adams and the certificate being dated July 17, 1902. That the second part consisted of one certificate as follows:

'No sheets have been added to this abstract since the above date. No other conveyances, judgments or liens of record since said date except as herein set forth. Taxes paid in full.

'Witness my hand this 28th day of April, 1913, at 4:15 o'clock p m. Henry C. Pratt, Abstract Maker.'

That this last certificate was fictitious, untrue, false fraudulent, and a forgery, designed and exhibited for the purpose of cheating and defrauding plaintiff. That there was no such abstract maker as Henry C. Pratt in Christian county Mo., at that or any other time. That in fact between July 17 1902, and April 28, 1913, the land had been sold for taxes to one Cobb, who became the owner by virtue of tax sales. That plaintiff did not discover the fraud practiced upon him until December, 1913, when he was informed that the land had been sold for taxes and was owned by Cobb. That defendant, in making the alleged false representations, was guilty of malice, fraud, and willful deceit. That defendant has not been prosecuted nor convicted in a criminal proceeding or action for the wrong, malice, fraud, and willful deceit so perpetrated upon plaintiff, nor is any criminal action pending against him on account thereof, and plaintiff offers to return the deed, and prays damages in the sum of $1,250 and $500 exemplary damages and for a finding, decree, and judgment that defendant was guilty of malice, fraud, and willful deceit in the statements and representations made and held out to plaintiff as to the character and extent of his title to the Missouri farm and in exhibiting a false abstract of title thereto; that upon such finding, judgment, order, and decree, plaintiff have a body execution against defendant upon which he may be committed to jail as provided by law.

The court instructed the jury that plaintiff based his claim for damages upon the ground that he was induced to enter into the exchange by fraud and false representations on the part of the defendant; that plaintiff claimed at the time the trade was made that defendant represented to him that he (defendant) had a good title to the Missouri farm and there were no liens outstanding against it except as shown by the abstract; that defendant in fact had no title to the property, that it had been sold for taxes prior to the exchange, that some person other than defendant owned it, and that the plaintiff got nothing by the trade; that defendant in his answer admitted making the trade, but denied that he made any misrepresentations in reference to the title, and the jury were instructed that if they found from the evidence on the trial that defendant represented to plaintiff that he was the owner of the Missouri farm, and produced and furnished what purported to be an abstract of title, and further found from the evidence that plaintiff, relying upon the truthfulness of these representations and the correctness of the abstract, was induced to and did convey to defendant his property for the deed to the Missouri farm and made the exchange without investigation, relying upon the truthfulness of defendant's representations, and further found that at the time defendant made said representations, if he made them, and produced such abstract, and at the time of the exchange, the representations made by defendant, if he made them, were false, and that he had no title to the Missouri farm and conveyed none to plaintiff, and that defendant at the time of making the representations knew them to be false, or made them without knowing them to be true, with the intention of having plaintiff rely upon their truthfulness, then they should find for plaintiff and assess his damages at whatever sum they might find from the evidence was the reasonable value of the Pueblo property; that if they found, however, from the evidence, that the defendant made no such representations to plaintiff as to the title of the Missouri farm, and that the contract was entered into by both parties, each having fairly represented his property to the other, then the verdict should be for the defendant. The jury returned the following verdict:

'We the jury find the issues herein joined for the plaintiff and against the defendant Charles N. McNulty, and assess his damages in the sum of $375.00.'

The court disregarded the verdict and entered judgment non obstante verdicto in the sum of $1,220.

Plaintiff and his son were the only witnesses for plaintiff who testified to the transaction. Plaintiff testified:

September 19, 1913, exchanged with McNulty my house and lot in Pueblo for the 80-acre farm in Missouri. My equity was worth $1,250. He told me the Missouri farm was 25 miles from Springfield; said he had never seen it and knew nothing about it personally; that it was free and clear of all incumbrances; that he had a deed in blank from Oldfield, and when we traded simply put in my name as grantee. I examined the abstract he gave me at that time and relied upon it. About December 20, 1913. I learned that the land had been sold for taxes. The property when it was exchanged to me had been sold for taxes against Oldfield before the last certificate on the abstract. The title in fact stood in Cobb. The first certificate to the abstract was made by Adams in 1902, the last entry of which shows the property was deeded September 17, 1901, to Oldfield. The Pratt certificate, made April 20, 1913, shows no entries and certifies that the taxes were paid. In this regard it does not state the truth. The land had been sold, after it was conveyed to Oldfield, for taxes. Kidder got to talking with my boy about trading, and he and McNulty came to my office one morning together and proposed a trade. I said: 'I will have to investigate before we talk.' Kidder had asked me before if he could not sell my property. I said: 'If you find a purchaser, it is all right.' Never had seen McNulty before. We did not make the trade then. They came back in the afternoon and we traded. When they came back, they had an abstract which they showed me, and Kidder says: 'You know enough about Missouri that land within 25 miles of Springfield could not be worth less than $25 an acre.' I said: 'Yes, I know that.' McNulty guaranteed that everything was all right and that the abstract showed a clear title. We went ahead and made the exchange, and I received the deed he had at that time from Oldfield to the Missouri farm and deeded him my Pueblo property.

Plaintiff's son testified:

McNulty said he would like to trade that land in Missouri for the equity. Kidder had been in and out of the office several times before, regarding the trade. He introduced McNulty, who said he had never seen the land. They came first in the morning, and Kidder took McNulty out to look at the house, and they came back in the afternoon. McNulty stated the abstract showed a clear title, free from all incumbrances with taxes paid to date, and handed it to father to examine and left it with him.

Pl...