Nelson v. Grondahl

• Citation: 96 N.W. 299,12 N.D. 130
• Decision Date: 05 June 1903
• Docket Number: 6731
• Court: United States State Supreme Court of North Dakota

96 N.W. 299

12 N.D. 130

PETER NELSON v. OLAF L. GRONDAHL

No. 6731

Supreme Court of North Dakota

June 5, 1903

Appeal from District Court, Cass County; Charles A. Pollock, J.

Action by Peter Nelson against Olaf L. Grondahl. Judgment for defendant, and plaintiff appeals.

Reversed.

Judgment reversed, a new trial granted, and cause remanded.

Turner & Lee, for appellant.

Benton Lovell & Holt, for respondent.

OPINION

MORGAN, J.

This action is brought by the plaintiff, as owner of a note for $ 250 made by one Paul Steffes to the defendant, and by him indorsed to the plaintiff. Two defenses are interposed: (1) That the indorsement and delivery of the note to the plaintiff were procured through the false and fraudulent representations of the plaintiff to the defendant; (2) that no notice of the dishonor and nonpayment of the note by the maker was ever given to the defendant. The jury found a verdict in favor of the defendant. Plaintiff moved for a new trial in due time upon a settled statement of the case. This motion was denied, and this appeal is from the order denying such motion. The errors assigned are four in number: (1) In refusing to grant a new trial; (2) in submitting to the jury the question of the dishonor of the note; (3) in submitting to the jury the question of fraud; (4) in refusing to grant plaintiff's motion for judgment notwithstanding the verdict.

It was an error to submit the question of fraud to the jury under the evidence. It is claimed by defendant that Nelson represented to him at the time of the indorsement of the note that Steffes had more money and would be willing to pay that note before it was due, providing Grondahl would let Nelson have it; he said he would go and collect it from Steffes. Such is Grondahl's testimony as to the transaction. It is claimed by the defendant that this constitutes the transaction a fraudulent one; that he made a promise during the negotiations without any intention of performing it making it a fraudulent contract under the provisions of section 3848, Rev. Codes 1899. Every representation of a fact made by Nelson during these negotiations is shown by the evidence to be true. It is claimed that because Nelson said that he would get or collect the money from Steffes, and did not, this constituted a fraud within the meaning of that section, as Nelson did not intend to get it from him. The record contradicts this contention. It shows that the plaintiff did try to collect it from Steffes, but failed. He would naturally be supposed to attempt its collection. There was $ 200 due him from Grondahl, tied up in the note, for commissions due on the sale of his land to Steffes, besides the $ 50 that he gave Grondahl when the note was transferred to him. This sum was paid as the difference between the face of the note and the amount coming to him from Grondahl for commissions. This $ 50 was tendered back to Nelson during the trial, and acceptance thereof refused. If this so-called "promise" could possibly be held to be within the statute, it is very clearly shown that it was not made without any intention of fulfilling it. No injury was occasioned to Grondahl through it in any event. When that indorsement was made it was understood and considered by the parties that Nelson had earned $ 200 as commissions by selling Grondahl's land. When that sum became due is a matter of conflicting evidence between them. Grondahl claims that no commissions were to be paid by him until he had been paid $ 500 in cash. In effect he says that the commissions were to be paid him out of the money paid by Steffes after the $ 500 was paid, which must all go to Grondahl; and, he never having been paid $ 500 in cash on the sale, no commissions ever became payable to Nelson. Conceding that such was the bargain, we cannot reach this conclusion. True, $ 500 in cash was never paid by Steffes. Only $ 350 was paid. But the evidence does not show that the payment of the whole price could not have been enforced by Grondahl had he wished to do so. In the place of doing so, he consented that Steffes should cancel the contract and receive back his notes. He surrendered all of Steffes' notes to him, and received back his contract to deed the land to Steffes. He then conveyed the land to his wife and she sold it soon after. The defendant cannot now be heard to say that he never received $ 500 in cash, as he received the equivalent of that sum, and made a new contract with Steffes by which Steffes was relieved from paying the notes turned back to Grondahl. In view of the fact that the commission was justly payable, it is not apparent how he is injured by having to pay the note which he turned over to Nelson as a recognition that the sum of $ 200 was or would be due from him as commission.

The mere fact that misrepresentations were made with intent to defraud defendant would not be sufficient and would not be ground on which alone to avoid the contract. Mere intent to defraud is not alone ground on which to base an action for fraud. Damage or injury must be shown, either accrued or to accrue. There must be a showing that the party has been placed at a disadvantage, to his damage. As said in Alden v. Wright (Minn.) 47 Minn. 225, 49 N.W. 767: "He must have acted on the faith of the false representations, to his damage. A party cannot sustain an action of this character where no harm has come to him. Deceit and injury must concur." The same principle is declared in the...