Reyer v. Blaisdell

• Decision Date: 08 June 1914
• Docket Number: 3911
• Citation: 143 P. 385,26 Colo.App. 387
• Parties: REYER et al. v. BLAISDELL.
• Court: Colorado Court of Appeals

143 P. 385

26 Colo.App. 387

REYER et al. v. BLAISDELL.

No. 3911

Court of Appeals of Colorado

June 8, 1914

Rehearing Denied Oct. 13, 1914

Error to District Court, City and County of Denver; Geo. W. Allen Judge.

Action by E.G. Reyer and others against George A. Blaisdell. Judgment for defendant, and plaintiffs bring error. Reversed with instructions.

Norton Montgomery, Horace N. Hawkins, and Elizabeth M. Brown, all of Denver, for plaintiffs in error.

Van Cise, Grant & Van Cise, John T. Bottom and Milnor E. Gleaves all of Denver, for defendant in error.

HURLBUT J.

September 24, 1909, plaintiffs in error, as plaintiffs below, brought this action against defendant in error. The prayer of the complaint asks for judgment in the sum of $22,089.70, and also for general equitable relief. A writ of attachment was sued out in aid of the action and levy made on defendant's property. The case was tried to the court, and it found for defendant, dismissing the action and dissolving the attachment.

The controlling object of the action, as appears from the complaint, is to recover from defendant the sum above specified. The complaint states, in substance, that in July, 1907, plaintiffs remitted to defendant the sum of $25,000 for the express purpose of purchasing a group of five mining claims in the Round Mountain mining district, state of Nevada; that defendant represented to them he was obliged to pay $25,000 for said claims, while in truth and in fact he only paid $625 therefor; that it was agreed and understood by all the plaintiffs and one Moyer (deceased), as well as defendant, that the claims were to be purchased by them all for their common interest and benefit; that plaintiffs reposed absolute confidence and trust in defendant to make the purchase and complete the transaction for the common benefit of all; that for a long time prior to the purchase of the claims plaintiffs and said Moyer had been interested with defendant in mining operations in Boulder county, Colo., and that in such operations defendant acted for and represented plaintiffs, which fact, as alleged, caused plaintiffs to repose full confidence and trust in defendant to negotiate and make the purchase aforesaid; that at all times plaintiffs were residents of the state of Pennsylvania, and defendant of the state of Colorado; that in June, 1907, defendant went from Colorado to said Round Mountain district, and made an examination of the claims purchased, and thereafter represented to plaintiffs that he could procure an option to purchase the claims for the sum of $25,000; that they were very rich in gold, and that if plaintiffs and Moyer would join him in raising that amount they would all become owners thereof with him; that they relied implicitly upon the statements made by defendant in that behalf and associated themselves together with him, and raised the $25,000; that in order to raise said amount all the plaintiffs, Moyer, and defendant joined in the execution of promissory notes in that amount; that the representations of defendant as to the amount of the purchase price were wholly false, and defendant knew them to be false when he made them; that instead of paying $25,000 for the five claims, he only paid $625 therefor, and converted the balance to his own use. It is also alleged that after the purchase defendant paid upon said promissory notes of $25,000 the sum of $2,285.30, which plaintiffs concede should be credited to defendant, as well as $625, which defendant paid for the claims as aforesaid. It is further alleged that in the misrepresentations made by defendant concerning the price paid for the claims, defendant was guilty of fraud and willful deceit, and that they were made for the purpose of deceiving plaintiffs and Moyer, and did in fact deceive them. An amendment to the complaint was filed, containing a full narrative of the maturity and renewals of said $25,000 notes, and averring that upon the maturity of the last renewal thereof plaintiffs and Moyer fully paid and discharged the same. After a number of demurrers and motions on behalf of defendant were disposed of by the court, defendant filed his answer, denying any fraudulent or wrongful acts on his part, or any false representations by him concerning the transaction in question. The answer admits, however, the receipt of the $25,000 by defendant as alleged in the complaint, but claims as a defense that plaintiffs were buying the property from him as an individual at the agreed price of $25,000, further alleging that there was no agreement or understanding between plaintiffs and defendant that the claims were to be purchased by them for the common benefit of all. Replication was duly filed.

Although the pleadings are somewhat lengthy, we think the above statement shows in a general way the issues upon which the litigation is predicated. The entire transaction, including the alleged fraud, misrepresentations, and deceit of defendant, which culminated in the remittance of the $25,000 to defendant and the purchase of the five claims by him, is shown and established by documentary evidence, consisting of about 100 letters and 15 telegrams, which passed between defendant and plaintiff Barton between May and November, 1907.

At the trial defendant, Blaisdell, plaintiffs Reyer and Barton, and one Nels Paulson, testified as witnesses, defendant being the only witness who appears to have testified for the defense. We will not attempt to comment in detail upon the evidence that appears in this ponderous record, but will say that we have read it all carefully, and have arrived at the conclusion that, taking it altogether and making allowance for some unimportant discrepancies, the actions, telegrams, and letters of defendant establish moral turpitude on his part in the negotiation and purchase of the claims, and in obtaining the $25,000 remitted by plaintiffs. In our judgment they show that defendant deliberately planned and conspired with plaintiff Barton to wrongfully and fraudulently obtain from plaintiffs (exclusive of Barton) a large part of the said $25,000.

Ernest effort is made by counsel for defendant in error in their brief to convince this court that Blaisdell was an innocent party, acting in perfect good faith with plaintiffs; that he held an option on the claims for something like $700 or $800 in his own name and right, and was dealing at arm's length with plaintiffs as purchasers of the claims from himself as an individual. We think the contents of the above-mentioned letters and telegrams destroy every vestige of defendant's contention in this behalf. They appear to conclusively establish the fact that the purchase was made for the common benefit and advantage of all the plaintiffs, Moyer, and defendant, and was so intended, understood, and agreed, by and between them. The record further discloses that considerable skill and ingenuity were exercised on the part of defendant and Barton to prevent plaintiffs (exclusive of Barton) from knowing or ascertaining the actual purchase price of these claims from the owners, and they were so successful in that regard that plaintiffs did not become aware that the real purchase price of the property was only $625, instead of $25,000, until some time in August, 1909, over two years after plaintiffs had paid that sum to defendant.

It would serve no good purpose to attempt to analyze the evidence in detail in order to support the conclusions we have reached on the merits. We are satisfied that the record entirely supports the plaintiffs' cause of action on the merits, and disproves defendant's attempted defense.

Returning now to the proceedings in the district court, it may be observed that the trial judge did not assume to decide the merits of the case, although he rendered a lengthy opinion containing his reasons for dismissing the action. In brief, he based his judgment of dismissal entirely upon the ground that Barton participated in whatever fraud or deception the defendant may have perpetrated upon plaintiffs, and that Barton and defendant stood, in relation to each other, in pari delicto; that Barton, as a joint plaintiff, therefore, could not recover from defendant; that plaintiffs were joint plaintiffs, and all must recover or none--thus adopting the rigid common-law rule as to joint plaintiffs in a law action. The court further held that neither section 222, Mills' Annotated Code, nor any other section thereof, was applicable to the case made by the record; that the section applies only to cases wherein it appears from the record or at the trial that a plaintiff suing jointly has no interest in the recovery, in which case he may be eliminated and judgment go for his coplaintiffs.

In view of the rulings of the trial court in dismissing the action as stated, it becomes necessary to consider and determine whether or not its ruling in that behalf is supported by the law. The complaint on its face purports to state but one cause of action, although divided into a number of paragraphs. It states in rather a concise manner the cause of action, and closes with a prayer for a money judgment, followed by one for general equitable relief. It shows that defendant holds in his possession $22,089.70 which rightfully and justly belongs to the plaintiffs. The facts there pleaded characterize the case as an action at law to recover money in defendant's hands which rightfully belongs to plaintiffs. In form it is somewhat analogous to the common-law action of indebitatus assumpsit for money had and received, the promise to repay being implied.

The complaint contains no substantial averments calling for equitable intervention. Full relief can be had by a money judgment. True, the complaint contains a number of averments alleging fraud, false...