Roda v. Berko
| Decision Date | 11 November 1948 |
| Docket Number | No. 30633.,30633. |
| Citation | 81 N.E.2d 912,401 Ill. 335 |
| Parties | RODA v. BERKO et al. |
| Court | Illinois Supreme Court |
OPINION TEXT STARTS HERE
Appeal from Circuit Court, LaSalle County; Louis A. Zearing, judge.
Suit in equity by Irene Roda against Joseph A. Berko and Yvonne Berko, his wife, for cancellation of a warranty deed executed by plaintiff to Joseph A. Berko, on ground of alleged false representations made by Joseph A. Berko. From a decree dismissing amended complaint for want of equity, the plaintiff appeals.
Decree reversed and cause remanded with directions to overrule motion to dismiss.
Paul D. Perona, of Spring Valley, and Taylor E. Wilhelm, of Ottawa, for appellant.
Clyde E. Mitchell and Fremont Kaufman, both of La Salle, for appellees.
This is an appeal from the circuit court of La Salle County wherein the plaintiff, Irene Roda, filed an amended complaint in equity against Joseph A. Berko and Yvonne Berko, his wife, requesting that a warranty deed executed by plaintiff to Joseph A. Berko be cancelled and held void by reason of false representation made by the grantee. The property involved consisted of eight and one-half acres of land located in the city of Oglesby in La Salle County. A motion to dismiss was filed by defendants averring that the amended complaint failed to state a cause of action. This motion was sustained and plaintiff elected to stand by her pleadings and the court entered a decree dismissing the amended complaint for want of equity. From the decree plaintiff prosecutes this appeal.
The only question presented by this appeal is whether the allegations of the amended complaint state a cause of action authorizing a court of equity to set aside the deed from plaintiff to Berko, by reason of fraud on his part in procuring its execution and delivery.
The amended complaint alleges that on and prior to June 1, 1945, the date of the execution of the deed, plaintiff was the owner and in possession of the property in question, which was included in and a part of about thirty-five acres owned by said plaintiff, the whole of which was situated in what is commonly known as the factory area of the city of Oglesby. It is alleged that there is located on the northeast corner of the thirty-five acre tract a two-story modern mercantile building belonging to plaintiff, which, before the above date, was worth at least $30,000; that along the east side of the property plaintiff had rented space to persons who built homes thereon ranging in cost and value from $3000 to $10,000; that the Eicor factory is located on the north and is a modern factory employing about 300 men and women and was built through the efforts of the citizens of the city at a cost of more than $100,000; that plaintiff is 75 years old, sickly and in constant pain; that she is Italian by birth and is unable to read and understand the English language; that Joseph Berko, hereinafter referred to as the defendant, informed the plaintiff through her son who acted as interpreter, that he was honest and she could rely on him to do what he said; that defendant had several conferences and discussions with her in which the purposes for which he was buying the real estate in question were stressed and considered; that he falsely, fraudulently and deceitfully stated to plaintiff that he would use said tract for factory purposes and would build thereon a modern factory costing more than $100,000, for the making of prefabricated houses and that the same would increase the value and rental income of the remaining property of plaintiff.
It is further alleged in the complaint that on June 14, 1945, when Berko left plaintiff's home to get the deed made she informed him she wanted a condition in the deed to defendant, that unless the premises were used for a factory, said real estate would revert to her; that the defendant did not explain to her, and she did not know, that the deed did not contain such condition, and she signed same relying on the statements of the defendant after he had fraudulently stated she could rely on him with complete confidence and he would reconvey if no factory was constructed within 3 months thereafter, and assured plaintiff said premises would not be used for any other purpose; that plaintiff learned afterwards that defendant then knew he or someone else would use said premises for a junk yard; that he fraudulently, falsely, wilfully and deceitfully obtained said deed from said plaintiff for the purpose of using said premises for a factory when he knew that he or someone else would use it for a junk yard.
Plaintiff further alleged in her amended complaint that as a result of the promises made by the defendant, and acting and relying thereon, she conveyed said premises to him for the sum of $3300; that after she made the conveyance she sent her son to defendant to see him in regard to same and that Berko stated he never intended to build a factory thereon but purchased the property for a junk yard, and that if he had told her of his intention she would not have sold it to him; that by arrangement between defendant and one William Brennan the property is being used by Brennan as a junk yard, where old cars, rags and other junk articles are placed and junk is stored and sold at retail; that it is an ugly sight and eyesore, and said junk yard constitutes a nuisance.
It is further alleged in the amended complaint that as a result thereof plaintiff's adjoining property has suffered and will continue to suffer decreased value; that persons who now rent space for their homes will move when their leases are up; that the mercantile building has and will decrease in value; that all of the rental income and profits from all of said real estate will decrease and that she has lost sales of the vacant property for other factories; that on July 15, 1945, as soon as she discovered said representations were false, she tendered to the defendant the purchase price and demanded that he reconvey and surrender to her possession of said premises but he refused and still refuses so to do; that plaintiff is willing, able and will repay to him the purchase price whenever the said premises are reconveyed to her; that the defendant, Joseph A. Berko, for the purpose of cheating and wronging the plaintiff and inducing her to convey to him the said premises, made the above misrepresentations knowing the same to be false and fraudulent; and that the plaintiff was induced thereby to make the conveyance.
A misrepresentation, in order to constitute fraud which will warrant a court of equity in rescinding a contract, must contain the following elements: It must be a representation in the form of a statement of a material fact, made for the purpose of inducing the other party to act. It must be false and known by the party making it to be false, or not actually believed by him, on reasonable grounds, to be true. The party to whom it is made must be...
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In re Polo Builders, Inc.
...money and close the transaction. Although it is true that a plaintiffs negligence is not a defense to fraud, see Roda v. Berko, 401 Ill. 335, 81 N.E.2d 912, 916 (1948), this principle coexists uneasily with the requirement that the plaintiff justifiably rely on the alleged misrepresentation......
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