State ex rel. Baxley v. Givhan

• Decision Date: 11 July 1974
• Citation: 297 So.2d 357,292 Ala. 533
• Parties: STATE of Alabama ex rel. William J. BAXLEY, Attorney General v. Walter C. GIVHAN et al. SC 529.
• Court: Alabama Supreme Court

Page 357

297 So.2d 357

292 Ala. 533

STATE of Alabama ex rel. William J. BAXLEY, Attorney General v. Walter C. GIVHAN et al.

SC 529.

Supreme Court of Alabama.

July 11, 1974.

William J. Baxley, Atty. Gen., George Beck, Deputy Atty. Gen., and Barry E. Teague, Asst. Atty. Gen., for the State.

Pitts, Pitts & Thompson, Selma, Rushton, Stakely, Johnston & Garrett, and William B. Moore, Jr., Montgomery, for appellee, Walter C. Givhan.

Richard H. Gill, Montgomery, and Alston Keith, Jr., Selma, for William H. Bernos and Sylvia Bernos, appellees.

Smith, Bowman, Thagard, Crook & Culpepper, Montgomery, for Alabama Historical Commission, appellee.

McCALL, Justice.

This is an appeal by the State of Alabama from a summary judgment entered against it as the complainant.

The bill of complaint, as amended, brought in the name of the State, on the relation of the Attorney General, charges the respondents, Givhan and the Bernoses, who are appellees, with fraud in and about the sale of the John T. Morgan house in Selma, Alabama, to the Alabama Historical Commission, which is also named as a respondent. It seeks to have the conveyance set aside and the consideration paid therefor refunded, or in the alternative, a rebate to the State of the amount paid over and above the property's reasonable value.

The John T. Morgan house (site) is the former residence of the late United States Senator John Tyler Morgan, an Alabamian of considerable renown, whose former residence, all of the respondents recognize as being worthy of preservation on account of particular historical significance.

Pursuant to a written motion filed by the respondents under Rule 56, Alabama Rules of Civil Procedure, 290 Ala. 373 at 547, the trial court rendered a summary judgment for them. The State assigns generally as error the entry of the judgment which also dismissed the suit.

The substance of the bill in its charging part is that the respondents, Givhan and the Bernoses, conspired to defraud and defrauded the complainant (the State) and the Alabama Historical Commission through a scheme, trick or device in and about the sale of the property to the Commission for $65,000. The basis for the alleged fraud is that this payment was obtained through undue influence and was so grossly in excess of the true value of the property as to shock the conscience; that the respondent Givhan, in furtherance of the alleged fraud wrote a letter to the Executive Director of the Alabama Historical Association (Commission), an agency of the State of Alabama, which is constituted a public body corporate, Code of Ala., Tit. 55, § 373(10j) et seq., as amended, in which he stated that he had been advised that the Bernoses would sell the John T. Morgan home to the State for a historical shrine for $65,000, that the house, on a large lot, was near the Sturdivant home, and that he truly believed that with some restoration work, the place could be one of the outstanding historical points in Central Alabama. His letter stated that the Bernoses preferred to deal directly with the State as otherwise a real estate commission would be necessary.

The bill then avers that the Executive Director expressed disinterest in the suggested purchase, but that the respondent Givhan repeatedly pressured him about purchasing the site; that when the respondent received the continued negative answers of the Executive Director and the Commission, the respondent reminded the Executive Director that the Commission would be needing his help as a senator in the State Legislature, when it came time to consider its annual appropriation for capital outlay, and he requested a committal from the Executive Director and the Commission to purchase the site from their porposed capital outlay funds; that the respondent threatened to introduce in the Alabama Senate a bill to create a new and separate historical commission unless the Executive Director and the Commission agreed to purchase the site for $65,000; that the Executive Director and the Commission again refused, whereupon the respondent Givhan introduced and secured passage in the Legislature of a separate appropriation for the purchase of the site for a maximum of $65,000. This was tacked on the House's general appropriation bill as a line item.

The bill of complaint next avers that the respondents continued to pressure the Executive Director and the Commission until they agreed to purchase the site for $65,000; that the respondents represented that the site was worth $65,000; that this was false, it being worth substantially less, and was known to the respondents to be false; that the representation as to value was material and was made with the intent to induce the complainant (the State) to part with the purchase price of $65,000; that the complainant relied on the false representation and bought the house; that the value of the site is so grossly inadequate as to shock the the conscience.

The bill further avers that any attempt to appraise the site prior to purchase was a sham as the purchase price had been preconceived and dictated by the respondents a full year prior to any appraisals.

Finally, the bill avers that the action of all of the respondents has resulted in the unjust enrichment of the respondents Bernoses, who owned the site.

The bill prays that the conveyance to the Commission be set aside for fraud and the Bernoses be ordered to repay the $65,000 to the complainant, or in the alternative pay the difference between its reasonable value and the actual price paid for the property.

The power and authority of the Alabama Historical Commission to acquire this site by purchase is not disputed. Such seems to be delegated to the Commission by Code of Ala., Tit. 55, § 373(10j) et seq.

As we understand it, the State contends that the respondents were guilty of fraud because they exercised undue influence over the Commission in order to bring about the purchase of the site, at the same time misrepresenting its value to the Commission at an amount grossly in excess of what the property was reasonably worth.

There is nothing in the record to show that the respondent Givhan or any person associated with the Commission was in any way financially interested in a personal manner in the transaction or expected to benefit from it other than gaining the satisfaction that comes normally from recognizing and memorializing a distinguished and notable citizen, and manifesting a representative's interest in his constituents and his district.

While it is clear that courts can and should intervene for the protection of the public in instances where there is fruad, corruption, or bad faith--the equivalent of fraud, Van Antwerp v. Board of Commissioners of City of Mobile, 217 Ala. 201, 115 So. 239; Finch v. State, 271 Ala. 499, 124 So.2d 825; Tri-State Corporation, Inc. v. State, 272 Ala. 41, 128 So.2d 505, and should vacate any contract of the State that is the product of actual fraud, McGehee v. Lindsay, 6 Ala. 16; Driscoll v. Burlington-Bristol Bridge Co., 8 N.J. 433, 86 A.2d 201; Finch v. State, 271 Ala. 499, 124 So.2d 825, the record here does not make out a genuine issue of fact as to a conspiracy or fraud, and we think it refutes the State's contention that the respondent Givhan successfully exerted any influence over the Commission which resulted in the purchase of the site. It is true that the record reveals that this respondent sought to exercise influence over the Commission in different ways, but at the same time it shows that his coercion did not bring about the purchase of the site. It should be observed that the Commission declined the respondent Givhan's urging to purchase the site out of its general outlay funds and never did do this. It is equally clear that his successfully sponsoring a line appropriation in the Legislature for the specific purpose of purchasing the site was not at the behest of the Commission and was not a legislative mandate to buy the site or pay $65,000 for it, but an appropriation of that sum of money as a means to purchase the site,...