Robinson v. Spicer

• Decision Date: 19 July 1963
• Docket Number: No. 9069,9069
• Citation: 86 Idaho 138,383 P.2d 844
• Parties: Russell W. ROBINSON and Margaret Robinson, husband and wife, Plaintiffs-Appellants, v. Virgil SPICER, as Administrator of the Estate of Lester Spicer, deceased and Bessie Spicer, widow of said decedent, Defendants-Respondents.
• Court: Idaho Supreme Court

Page 844

383 P.2d 844

86 Idaho 138

Russell W. ROBINSON and Margaret Robinson, husband and wife, Plaintiffs-Appellants, v. Virgil SPICER, as Administrator of the Estate of Lester Spicer, deceased and Bessie Spicer, widow of said decedent, Defendants-Respondents.

No. 9069.

Supreme Court of Idaho.

July 19, 1963.

Sidney E. Smith, Coeur d'Alene, for appellants.

Richard L. McFadden, St. Maries, for respondents.

KNUDSON, Chief Justice.

On September 20, 1957, appellants (plaintiffs) as purchasers entered into a written contract under the terms of which they agreed to purchase from Lester Spicer and Bessie Spicer, husband and wife (original defendants) as vendors, certain real and personal property for a total consideration of $42,250.00. The down payment consisted of a conveyance by appellants to vendors of a dwelling in Spokane, Washington, for which appellants were credited the sum of $8,000.00. Under the terms of the contract, after crediting the down payment, $10,000.00 remained unpaid on the personal property which was to be retired by monthly payments of $125.00 each, plus interest, and an unpaid balance of $24,250.00 on the real estate which was to be paid at the rate of $70.00 per month, plus interest. Upon full payment of the amount payable for the personal property the monthly installment payments payable for the real estate were to increase to $145.00, plus interest.

Appellants went into possession of the property pursuant to said contract and on December 21, 1959, commenced this action for cancellation and rescission of said contract, alleging that respondents falsely and fraudulently represented to appellants:

(1) That 18 head of dairy cattle covered by the contract were purebred Holsteins, registered or capable of being registered with the Holstein-Friesian Assn. of America;

(2) That the land described in and subject of the contract would produce sufficient hay to feed a 40-head dairy herd;

(3) That the net dollar income per month from the dairy herd production was $1,095.00;

(4) That all of the cultivated land, except 6 acres, was good ground and would raise four ton of hay per acre.

Vendors made answer denying said allegations and filed their cross-complaint seeking judgment requiring strict compliance with the contract or in the alternative restitution of the property and damages, alleging, inter alia, default on the part of appellants in failing to make payments of principal, interest and taxes when due, as provided under the contract, and in failing to take proper care of the property covered by the contract.

Prior to the trial of this action, which commenced February 1, 1961, defendant Lester Spicer died. Pursuant to stipulation of counsel for the parties it was ordered that Virgil Spicer, as administrator of the estate of Lester Spicer, be substituted as one of the defendants.

Trial was had before the court sitting without a jury. Judgment was entered denying appellants any relief under their complaint and awarding judgment in favor of respondents under their cross-complaint. Under the judgment appellants were granted thirty days within which the bring all delinquencies under the contract to date and in the alternative the contract to be declared forfeited and respondents restored to possession of the property involved. This appeal is from said judgment.

Under their amended complaint appellants prayed for rescission of the contract or damages, however, at the close of the introduction of evidence relative to their case in chief, appellants made their election as follows:

'MR. SMITH: If the Court please, at this time, the plaintiffs will rest their case, and at the same time I would like to make a motion for the record that the plaintiffs elect under the pleadings of the complaint for rescission rather than for relief in damages.

'THE COURT: The plaintiffs are voluntarily electing to proceed under the rescission theory instead of damage theory.

'MR. SMITH: And with that, we rest.'

Thereby appellants voluntarily limited the issue raised by their complaint to appellants' contention that they were entitled to rescission of the contract upon the ground of false and fraudulent misrepresentation on the part of respondents.

Under appellants' first assignment of error they complain that the court disregarded evidence establishing that they relied upon 'misrepresentations' of respondents when entering into the contract.

Notwithstanding the allegations in appellants' amended complaint that to induce appellants to enter into the contract defendants falsely and fraudulently represented the quality of the ground described in the contract and the net income per month from the dairy herd production, no substantial evidence was introduced to support such allegations and the trial court properly found that no such false representations were made.

As to the other alleged misrepresentation that 18 head of the cattle described in the contract were retgistered Holsteins, the court found:

'That the defendant Bessie Spicer had no knowledge of the fact of the improper or irregular registeration of said cattle; that if the defendant, Lester Spicer, did, in fact, have actual knowledge of said improper registerations, or was negligent to the extent that it was tantamount to having such knowledge at the time the representations with respect to said registery was made, the plaintiffs did not in fact rely upon such representations, and said representations were not sufficiently material and substantial to warrant recision of the contract.'

The record discloses that following some investigation and hearings the Holstein-Friesian Association determined that the animals were not entitled to registration although certificates of registration had been issued as to some.

It is clear that the trial court was convinced that Mrs. Spicer had no knowledge of improper or irregular registration of the cattle and made no misrepresentations regarding them. It is equally clear that the court was not convinced that Lester Spicer had actual knowledge of any improper registration.

In cases such as this where a party alleges fraudulent misrepresentations as grounds for rescission of a written contract it is the burden of the party alleging the fraud to establish all of its essential elements by clear and convincing evidence. Nelson v. Hoff, 70 Idaho 354, 218 P.2d 345; Scogings v. Love, 79 Idaho 179, 312 P.2d 570; Lott v. Taylor, 60 Idaho 263, 90 P.2d 975.

Appellants do not argue that the evidence establishes fraud in a clear and convincing manner, but that it does establish 'that either the defendants knew the representation was false or acted in such a negligent manner as to be charged with responsibility.' The evidence to which appellants refer as supporting their charge of fraud is the evidence showing that Lester Spicer had control of the records and that the applications for registration were made by him.

In refutation of the claim of fraud respondents point out that there was no attempt whatever on their part to conceal any information regarding the property involved either before or after the contract was executed; that the barn book, certificates and other records kept by respondents were at all times subject to examination by and regularly turned over to appellants; that Lester Spicer had suffered a heart attack about June 10, 1955, and some of the records were made by people other than Lester Spicer and by reason of his illness entries were made in reliance upon information furnished by others.

It would unduly lengthen this opinion to quote or refer to all the evidence introduced relating to the registration of the cattle involved. The trial court did not find that respondents had intentionally misrepresented any fact as to...