Schwedler v. First State Bank of Gresham

• Decision Date: 08 April 1919
• Citation: 92 Or. 33,179 P. 671
• Parties: SCHWEDLER v. FIRST STATE BANK OF GRESHAM ET AL.
• Court: Oregon Supreme Court

179 P. 671

92 Or. 33

SCHWEDLER v. FIRST STATE BANK OF GRESHAM ET AL.

Supreme Court of Oregon

April 8, 1919

Department 2.

Appeal from Circuit Court, Multnomah County; C. U. Gantenbein Judge.

Action by E. Schwedler against the First State Bank of Gresham and another. From judgment for defendants, plaintiff appeals. Affirmed.

Plaintiff appeals from a judgment sustaining a demurrer to his complaint. The action is brought to recover damages for fraud and deceit. The substance of the allegations of the complaint is as follows:

After the averment of the incorporation of the defendant state bank, it is alleged in paragraph II that plaintiff was the owner, subject to a mortgage of $5,000, of certain real property near Gresham, Or., describing the same by metes and bounds.

Paragraph III. That prior to the 24th day of March 1914, W. S. Brande was the owner, subject to a mortgage of $16,000, of certain real property, particularly describing the same, known as the Cornutt place.

Paragraph IV. That prior to the 24th day of March, 1914, the defendant Archie Meyers was the owner of certain real property particularly describing the same, containing 85 acres more or less, in Clackamas county, Or.; and further averred that during all the times mentioned in the complaint, plaintiff was a customer and depositor of the defendant bank, and for a number of years had transacted all his business with the defendant First State Bank of Gresham; that the defendants were acquainted with his financial condition; that the defendant Archie Meyers was president of the bank, and that plaintiff for a number of years had intrusted his affairs to the defendants and relied upon the honesty and integrity of defendants; that defendants knew that plaintiff's assets consisted of the property described in paragraph II of the complaint, with the stock and chattels thereon, and that the same was mortgaged for the sum of $5,000.

Paragraph VI is as follows:

"That on or about the ______ day of February, 1914, for the purpose of inducing the plaintiff to enter into the contract as hereinafter referred to for the purchase of said land described in paragraph III of this complaint, the defendants made to the plaintiff the following representations: That one W. S. Brande, the owner of said property described in paragraph III hereof, desired to sell said property for $21,000, and the said Brande would take a mortgage of $14,000 for the unpaid balance; that the plaintiff could secure said property for the sum of $21,000, $7,000 to be paid in cash and the plaintiff and his wife to make and execute a mortgage of $14,000 to one Archelaus Cornutt for the balance of the purchase price of said property, the said mortgage of $14,000 to be in two notes, one of $2,000 at 5 per cent. payable on or before three years after date, and the second note of $12,000 at 5 per cent., payable on or before five years after date, and the said mortgage of $14,000 to constitute a first lien on the said property; that the defendants had a purchaser for plaintiff's property; that said purchaser would pay therefor the sum of $33,500, the plaintiff to pay to the defendants the sum of $1,500 as commission; that the defendants knowing the financial condition of the plaintiff and knowing that the only way plaintiff could secure $7,000 as the first payment on the property described in paragraph III was to mortgage his home, represented to the plaintiff that they would secure for plaintiff a loan of $7,000 to become the first lien on plaintiff's property; that they would pay the $5,000 mortgage, then the first lien on plaintiff's property, and that plaintiff was to execute and deliver to the First State Bank of Gresham a second mortgage of $5,000 on said property; that the defendants further represented to plaintiff that the mortgage of $14,000 to be executed by the plaintiff and his wife as above set forth would be due on or before three and five years, respectively, for the reason that plaintiff would be able to pay said mortgage as soon as the transaction for the purchase of the plaintiff's property was consummated."

In paragraph VII it is alleged that all of said representations were knowingly false and were believed and relied upon by plaintiff, who was induced thereby to enter into the contract thereinafter mentioned, and were made for the purpose of deceiving and defrauding plaintiff.

Paragraph VIII reads thus:

"Contemporaneous with the above-mentioned representations, the defendant Archie Meyers negotiated with the said W. S. Brande for the trading of the property described in paragraph III, for 85 acres of land owned by the said Archie Meyers and located in Clackamas county, Or.; the same being the property described in paragraph IV."

Paragraph IX is as follows:

"That on or about the 16th day of February, 1914, in pursuance to and on account of the said representations and relying upon said representations, the plaintiff instructed the defendants to enter into a contract with the said W. S. Brande on behalf of this plaintiff, wherein and whereby plaintiff agreed to purchase from the said W. S. Brande the property described in paragraph III of this complaint for the sum of $21,000 payable as follows: $7,000 cash and the balance in two notes one for $2,000, at 5 per cent., interest payable semiannually, payable on or before three years after date, and the second note of $12,000, at 5 per cent., interest payable semiannually, payable on or before five years after date. The said notes were secured by a mortgage in the sum of $14,000, which mortgage was to constitute a first lien on the property described in paragraph III of this complaint. That plaintiff, relying upon said representations as aforesaid, further agreed with the defendants that he would sell and instructed the defendants to sell his property to the purchaser had and known by the defendants for the sum of $33,500 and agreed to pay to the defendants as their commission in said transaction the sum of $1,500. That in accordance therewith, on the 18th day of March, 1914, the plaintiff, Ernest Schwedler, and his wife, Helen Schwedler, made, executed and delivered to Charles Johnson their note and mortgage in the sum of $7,000 and which mortgage became a first lien on plaintiff's property. That on the 24th day of March, 1914, the plaintiff and his wife made, executed and delivered to Archelaus Cornutt their notes and mortgage in the sum of $14,000, which mortgage is the first lien on the property described in paragraph III of plaintiff's complaint, and that on the 24th day of March, 1914, the plaintiff and his wife made, executed and delivered to the First State Bank of Gresham, the defendant herein, their note and mortgage in the sum of $5,000 and which note and mortgage became a second lien on the plaintiff's property. That plaintiff instructed defendants to pay to said W. S. Brande said $7,000."

It is alleged in paragraph X in effect: That the said representations were false and at the time were known by the defendants to be false and fraudulent in the following particulars: That the defendants did not have a purchaser for plaintiff's...