Morrow v. Wm. Berklund Forest Products Co., 8725

CourtUnited States State Supreme Court of Idaho
Citation81 Idaho 428,346 P.2d 623
Docket NumberNo. 8725,8725
PartiesAlberta G. MORROW, Plaintiff-Appellant, v. WM. BERKLUND FOREST PRODUCTS CO., a co-partnership, Defendant-Respondent.
Decision Date06 July 1959

Page 623

346 P.2d 623
81 Idaho 428
Alberta G. MORROW, Plaintiff-Appellant,
WM. BERKLUND FOREST PRODUCTS CO., a co-partnership, Defendant-Respondent.
No. 8725.
Supreme Court of Idaho.
July 6, 1959.
Rehearing Danied Nov. 18, 1959.

[81 Idaho 430]

Page 624

Allan G. Shepard, Wm. R. Padgett, Boise, Givens, O'Leary, Doane & Givens, Boise, for appellant.

[81 Idaho 431] J. H. Felton, Lewiston, J. L. Eberle, Boise, and Ray McNichols (amicus curiae), Orofino, for respondent on petition for rehearing.

TAYLOR, Justice.

Plaintiff (appellant), a widow, is the owner of a cattle ranch, about 18,400 acres in extent, upon which she grazes from six to eight hundred head of cattle. Her ranch is in an area known as the Joseph Plains, between the Snake and Salmon rivers, in Idaho county. Since the death of her husband in 1943 she has operated this ranch with the aid of one hired man. The ranch is accessible in summer over a difficult road, which requires a vehicle with four-wheel drive. In winter access to the outside is gained only by boat on the Snake river or by horseback over the plains to Cottonwood.

The plaintiff had had only an eighthgrade education and her business experience was limited to the raising, buying and selling of cattle. Although she was familiar with the boundaries, corners and description of her land and had observed the timber growing thereon, she had never sold any timber and was wholly inexperienced in, and had no knowledge of, the cruising or estimating of timber.

In early August, 1948, one L. L. Spafford, sought from plaintiff an option to buy the merchantable timber on her property. He advised plaintiff that he was [81 Idaho 432] working for defendants, who were lumbermen of Big Bay, Michigan; that defendants were not interested in any of the timber standing on steep slopes, gullies, or creek bottoms; they wanted to buy only the timber on the level plateau. After Spafford had spent some time traveling over and observing plaintiff's lands, he prepared an option agreement, dated August 9, 1948, which he and plaintiff executed, providing for a sale to Spafford of all merchantable timber standing upon the land described therein, totaling approximately 5,000 acres. The price of the timber fixed by the option was $4.50 per thousand board feet for pine and $3 per thousand board feet for larch, fir and spruce. The option also contained the following provisions:

'It is a mutual agreement by and between the seller and purchaser that the said timber shall be cruised by a competent cruiser agreeable to both parties and upon the completion of the cruise which shall then become a part of this contract or agreement showing the value of all species of timber on this tract.

'Upon the cruise of said timber being made, each party hereto shall be given a copy thereof and the purchaser will thereafter pay three per cent (3%) interest on the unpaid balance of the price of said standing timber as shown by said cruise.

Page 625

'In case the cruise made by the purchaser is not satisfactory, the seller can have this cruised at their own expense. In case it is not satisfactory to either party the two cruisers can appoint a third cruiser in whose case will be final. Second and third cruise paid by seller.'

Spafford told Mrs. Morrow competent cruisers were hard to get, and it might be some time before they would be able to get one. He also told her that William E. Berklund, also known as William Berklund, Jr., had had experience and would be a reliable and competent cruiser, and would cruise the property.

The defendant (respondent) is a partnership, in which William C. Berklund, Olga C. Berklund, William E. Berklund, Curtis J. Berklund and Jane B. Hamil are the partners. The defendant is the successor in interest of William Berklund Forest Products of Big Bay, Michigan, a partnership composed of William C. Berklund and Olga C. Berklund. William C. Berklund is the father of William E. Berklund, and the two are sometimes referred to in the record as William Berklund, Sr., and William Berklund, Jr., respectively. At the time of the Morrow transactions, William Berklund, Jr., was a member of the partnership, but was taken into the present partnership after the family moved to Idaho. William Berklund, Sr., testified that the present partnership is largely held by [81 Idaho 433] him and his wife. William Berklund, Sr., had been in the timber and logging business for thirty-five years, in the milling business for ten years, and had been doing cruising since 1939. He estimated he had purchased a total of 150,000,000 board feet of timber. His son, William, Jr., had worked with him in the cruising and timber business since 1939.

After the date of the option the William Berklunds, Sr., and Jr., with the part time help of a third man, spent some considerable time upon plaintiff's lands examining the timber.

October 12, 1948, at the invitation of one, Butcher, a son-in-law of plaintiff, the two William Berklunds met with Mrs. Morrow, in Cottonwood, in an apartment of another son-in-law of plaintiff. There negotiations took place during which Berklunds informed plaintiff that they had examined the timber on her property and estimated the volume and, being asked by her what their findings were, exhibited to her three small sheets of note paper, upon which were written two columns of figures, one headed 'Pine' and the other 'Fir'. The totals at the bottom were, pine 7105 M, fir 1263 M, purporting to represent a volume of 7,105,000 board feet of pine, and 1,263,000 board feet of fit. Mrs. Morrow then asked Berklunds if they did not think there was more timber than that on the property; to which they answered, no, that was all they could 'get'. Plaintiff then advised them she had had a cruise made by one, Edwards, of approximately 520 acres and showed them his report. Berklund, Sr., then directed his son to take the Edwards cruise and compare it with their own. Whereupon, William, Jr., took the Edwards report and left the apartment. A half hour or an hour later he returned and advised that the comparison showed that the Berklunds' cruise was 'a little bit low.' The plaintiff expressed a desire to sell ten million board feet for $45,000 and offered to add additional land on the Salmon river slopes, accessible along the existing road, sufficient to make up the ten million board feet. The Berklunds agreed to this proposal, provided the percentage of fir shown by their cruise be taken into consideration, and the price for the ten million board feet adjusted accordingly.

Plaintiff's exhibits 10 and 11 show that final agreement was reached upon this basis: 8,437,000 board feet of pine at $4.50 per thousand, $37,966.50; 1,563,000 board feet of fir at $3 per thousand, $4,689.00; or a total price of $42,655.50. This was the consideration expressed in the 'warranty timber deed.' The deed was prepared by Spafford some time after the meeting of October 12, 1948, but was dated January 10, 1949. In explanation of this delay, William Berklund, Sr., testified that at the meeting

Page 626

on October 12, Mrs. Morrow inquired about the effect on her income tax and said, [81 Idaho 434] 'I SOLD A LOT OF COWS THIS YEAR AND I WOUld Rather not have too much money coming in.' So it was agreed that the transaction would be effective January 10th.

The deed, subsequently executed by plaintiff, provided for payment of the agreed consideration in installments over a period of years extending to January 10, 1954. The consideration has been fully paid.

In the summer of 1956, William Berklund, Jr., made another examination of the timber. Mrs. Morrow, having heard that the Berklunds were cruising timber on her property, and on other properties in the general area, upon which they had also acquired timber, and were selling therefrom timber in much greater volume than they had represented to the owners at the time of purchase, became suspicious as to the correctness of the volume of timber reported to her by Berklunds at the time of the sale. She thereupon employed one, Robert S. Nobis, to make a cruise of the timber covered by her deed to defendant. Nobis was well qualified, both by training and experience. He conducted a cruise of the property in November, 1956. Where the stand of timber was continuous and without breaks, he did a 10% cruise. Where the stand was not continuous he did a 20% cruise. On 20 to 25 forties, where there were 'long stringers' of timber, or small groups, 'not susceptible to percentage cruises', he did a 100% cruise; that is, he counted and measured all merchantable trees. He also made random borings of all the types of trees except larch and spruce, and in all aged trees and in the various locations and growing conditions existing on the land, to determine the volume increment between 1948 and 1956. He also calculated the amount of timber which became merchantable during that period, and recently dead timber found on the property. After deducting the amount of the increment, new timber and recently dead timber from the total volume found by him, Nobis reported a total volume of 22,134,000 board feet of merchantable timber on the property in 1948. Eliminating the larch and spruce not conveyed by the deed, the volume by species, as reported by Nobis, was 17,647,000 board feet of pine, 4,487,000 board feet of fir.

Thereafter, December 27, 1956, Mrs. Morrow commenced this action, praying for rescission and cancellation of her option and deed on the ground of fraud, and offering to make restitution to defendant of the consideration received.

The complaint charges that the defendant fraudulently misrepresented the volume of timber upon the property, and fraudulently concealed from her the true volume thereof; also alleges that defendant represented to plaintiff that defendant was not interested in timber standing on steep slopes, or in gullies or creek bottoms, and [81 Idaho 435] that the option and deed did not cover such timber....

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4 cases
  • Safeco Ins. Co. of America v. Young, 88-15826
    • United States
    • United States Courts of Appeals. United States Court of Appeals (9th Circuit)
    • February 20, 1990 the material though innocent misrepresentation of a party is voidable against that party."); Morrow v. Wm. Berklund Forest Prods. Co., 81 Idaho 428, 346 P.2d 623, 630 (1959) (innocent material misrepresentations render a contract For rescission to be based on an innocent misrepresentatio......
  • Saviers v. Richey, 11266
    • United States
    • United States State Supreme Court of Idaho
    • December 31, 1974
    ...question. The case at bar does not meet those demands and will not be decided in the abstract. Morrow v. Wm. Berklund Forest Products Co., 81 Idaho 428, 346 P.2d 623 (1959); Hansen v. Devaney, 82 Idaho 488, 356 P.2d 57 (1960); Hale v. Heninger, 87 Idaho 414, 393 P.2d 718 The judgment of the......
  • Fisher v. Idaho Mining & Milling, Inc., 8902
    • United States
    • United States State Supreme Court of Idaho
    • November 22, 1960
    ...Agency v. Pemberton, 38 Idaho 235, at page 239, 221 P. 133, 135, and quoted with approval in Morrow v. Wm. Berklund Forest Products Co., 81 Idaho 428, 440, 346 P.2d 623, 630, as "* * * where the circumstances impose upon the vendor a special duty to know the truth of his representations, or......
  • Gasser v. Garden Water Co., 8784
    • United States
    • United States State Supreme Court of Idaho
    • November 17, 1959
    ...and is intended to serve the best interests of a majority of the stockholders. We conclude that the Finding of Fact of the trial court [81 Idaho 428] that the regulation requiring appellant to indemnify the Company before granting his application for the flow of water in the Company's canal......

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