Thompson v. Newell

• Decision Date: 07 May 1906
• Citation: 94 S.W. 557,118 Mo. App. 405
• Parties: THOMPSON et al. v. NEWELL.
• Court: Missouri Court of Appeals

94 S.W. 557

118 Mo. App. 405

THOMPSON et al. v. NEWELL.

Kansas City Court of Appeals. Missouri.

May 7, 1906.

1. FRAUD—ELEMENTS—INJURY FROM FRAUD.

To support an action at law for fraud, actual damages must have resulted to plaintiff from the fraud alleged.

2. SAME—DAMAGES—MEASURE OF DAMAGES.

In an action for fraud inducing a sale of real estate, the measure of damages is the actual loss sustained by the purchaser as the direct result of the fraud, and is, as a general rule, the difference, at the time of sale, between the contract price and the market value of the property.

3. SAME—WANT OF INJURY FROM FRAUD.

A real estate dealer purchased a farm for $16,000. The deed recited that the consideration was $20,000. He induced a third person to execute a contract for the purchase thereof for $20,000, on the representation that he sold it for what it cost. The farm was worth $20,000. Held that, as the third person suffered no injury, an action for fraud could not be maintained.

4. DAMAGES—NOMINAL DAMAGES.

Where a purchaser of land did not sustain actual damages, though the vendor made a false representation, the purchaser was not entitled to recover nominal damages.

Appeal from Circuit Court, Jasper County; Hugh Dabbs, Judge.

Action by Frank Thompson and another against J. P. Newell. From a judgment for defendant, plaintiffs appeal. Affirmed.

E. O. Brown and George Hubbert, for appellants. McReynolds & Halliburton and Thomas & Hackney, for respondent.

JOHNSON, J.

Action to recover damages alleged to have been sustained in consequence of deceit practiced by defendant in the sale of land to plaintiffs. At the conclusion of the introduction of their evidence, plaintiffs were nonsuited, and bring the case here on appeal.

The controversy arises out of the sale of a farm of 405 acres lying in Jasper county, some four miles from Carthage. On May 9, 1903, the parties entered into a contract in writing, wherein it was agreed that, "in consideration of the payment by the parties of the second part [plaintiffs] to the party of the first part [defendant] of the sum of $20,000.00, to be paid in the manner and times hereafter mentioned, the party of the first part agrees to sell and convey by good and sufficient warranty deed containing the usual covenants of warranty, free from all incumbrances, the following described real estate," etc. The terms of this contract are of no importance to the present inquiry and need not be stated. Before this suit was begun, it was fully executed by the payment in full of the purchase price and the delivery of a deed to plaintiffs. Possession of the premises was given them when the contract was made. The deceit, which plaintiffs contend gives them a cause of action in damages, will appear from these facts collated from the evidence introduced by them. Defendant, a real estate dealer in Carthage, owned, and for some two years had owned, the farm, and was endeavoring to sell it. He bought it from a man living in Jasper county and paid $16,000 for it, but at his request the deed he received (duly recorded) expressed a consideration of $20,000. Plaintiffs are husband and wife, and at the opening of the story were farmers living in Indiana. They sold their farm in that state and contemplated a trip to Kansas in quest for another. There fell into their hands at this time (no matter from what source) some advertising pamphlets, which defendant sowed broadcast, descriptive of the excellence of Jasper county farming lands in general and of those listed by defendant in particular. Thereupon, plaintiffs, accompanied by a neighbor and his wife (of the name of Patton), bought return trip tickets to Wichita, Kan., by way of Carthage, and stopped at the latter place to interview defendant. They went to the hotel and soon after called on defendant at his office. Defendant, in the prosecution of his business of real estate dealer and agent, was most diligent and enterprising. Carriages in charge of competent guides were furnished by him for the use of plaintiffs' party in the making of various excursions into the country to inspect farms defendant had for sale. Plaintiffs say that during their stay in Carthage the attentions they received from defendant and his assistants were so unremitting that they had no opportunity for independent investigation and inquiry, and their obsession was so complete that they received no information relative to farm lands and their value save through channels of defendant's selection. Finally, defendant's efforts to make a sale were concentrated on the farm in question. Plaintiffs were afforded every opportunity to thoroughly examine it, and, to defendant's credit, no complaint is made of any misrepresentation respecting its acreage or quality. The price asked by defendant was $24,000. Plaintiffs objected to this, thinking it too high, and Mrs. Thompson expressed a preference for another farm on defendant's list. The negotiations came to a head in this wise: Mr. Thompson and his neighbor Patton visited the office of a Mr. Manley, another real estate agent in Carthage, and were engaged in conversation with him, when one of defendant's employés entered and told plaintiff that defendant wished to see him at his office and had concluded to sell plaintiffs the farm at just what it cost, $20,000. Plaintiff and Patton then left Manley's office and went to the hotel, where Mrs. Thompson was informed of the offer made. Mr. Thompson, still accompanied by Patton, then went to defendant's office and had this conversation with him. "Q. What was the first conversation you recollect? A. We sat down and I asked Mr. Newell, I says to him, `This man tells me you would sell the place at cost, and I come over to see if we could make a trade.' Q. And what did he say? A. He says, `Yes, I propose to sell it rather than to lose you; or something of that kind. Q. Give his language as near as you can. A. `That I will sell you the place at cost, $20,000.'" Plaintiffs say they believed the statement, and, knowing that defendant was an expert judge of real estate values, were convinced they would be getting a bargain if they could buy the land at what one so expert actually paid for it. This fact alone induced them to make the purchase. Defendant prepared the written contract for the sale, and before it was signed Mrs. Thompson, who was not altogether satisfied, announced in defendant's presence her unwillingness to close the transaction, whereupon defendant exclaimed. "You can have it at cost rather than lose you—rather than lose this deal. * * * We will let you have it at just what I paid for it. I am not making a penny on it." After this the contract was signed by defendant and both plaintiffs, partial payments were made as agreed on the purchase price, and plaintiffs took possession of the farm. They discovered the fact that the cost of the farm to defendant had been misrepresented before all of the purchase money was paid and before the delivery of the deed to them, but paid the full price and accepted the deed before bringing this suit.

Mr. Thompson was 57 years old, an experienced farmer, and had bought and sold to advantage several farms in Illinois and Indiana. From their testimony, we judge that both he and his wife are persons of more than average intelligence and business capacity. He lived in Jasper county for about three years during the decade ending in 1880, and worked on a farm near the land he bought. Plaintiffs were diligent and thorough in their examination of the different farms they visited, and were entirely too businesslike for us to believe that they reposed...