Traber v. Hicks

• Decision Date: 26 November 1895
• Citation: 131 Mo. 180,32 S.W. 1145
• Parties: TRABER v. HICKS et al.
• Court: Missouri Supreme Court

32 S.W. 1145

131 Mo. 180

TRABER v. HICKS et al.

Supreme Court of Missouri, Division No. 1.

November 26, 1895.

ACTION FOR FRAUD AND DECEIT — PETITION — EVIDENCE — INSTRUCTIONS — MEASURE OF DAMAGES — OBJECTIONS TO DEPOSITIONS — TIME OF MAKING.

1. Plaintiff alleged that he contracted to sell one R. certain lots for $13,000, of which $4,000 was to be paid in cash, and the balance secured by second mortgage; that defendants agreed to loan R. $22,000, secured by first mortgage on the lots, with which to erect buildings on them, knowing of the arrangement between plaintiff and R.; that, before the execution of the papers, R. and defendants agreed that $6,000 should be paid to R., or his order, on completion of the foundations, which would cost in fact less than $1,200; that defendants, on completion of such foundations, paid R.'s assignee such $6,000, knowing that the foundations did not cost exceeding $1,200; that defendants had previously agreed with plaintiff that they would, so far as possible, see that the money loaned R. was applied in the erection of such buildings; that the agreement between R. and defendants was made and carried out with the fraudulent intent of making the cash payment on the purchase of the lots out of the money borrowed from the defendants, and secured by such first mortgage; that R. failed to complete such buildings, and was insolvent; and that defendants, for value and before maturity, assigned their notes and mortgage to an innocent purchaser. Held, that the petition stated a cause of action for fraud and deceit.

2. In such case the court in its charge, after requiring the jury to find all the facts charged as fraud, required a further finding that the money loaned was not applied as required by the terms of defendants' promise. Held, that such charge was not open to the objection that it authorized a recovery upon a simple breach of the promise by defendants to apply the money loaned R. to the construction of such buildings.

3. There was evidence that a fourth person was plaintiff's agent in the sale of such lots to R.; that the agreement to pay plaintiff $4,000 cash was negotiated by such person, and was one of the conditions on which plaintiff agreed to waive his vendor's lien, and accept a second mortgage for the balance of the price; that R. employed such agent to obtain for him a loan of $4,000, to make such cash payment; and that such agent arranged the scheme by which R. was enabled to pay the $4,000 out of the sum loaned by defendants, by receiving $6,000 on finishing foundations costing only $1,200. Held, that it was not error to refuse to charge that, if the jury found such facts, plaintiff was bound by such information as such agent possessed in regard to such transaction.

4. Evidence of a witness derived from written memoranda made by another years after the transaction is hearsay evidence, and an objection to the deposition, because of the incompetency of the evidence, was in time if made at the trial.

5. Letter-press copies of letters are not admissible in evidence, in the absence of notice or other efforts to produce the original.

6. In an action for fraud and deceit, a letter-press copy of a letter from defendants to a third person was admitted in evidence over defendants' objection, without notice or other effort to produce the original. The letter stated, in substance, that certain notes and mortgages were desirable investments, and that defendants would dispose of them. There was no dispute that defendants regarded such notes as good and desirable investments. Held, that the error in admitting such copy was harmless.

7. In an action of deceit, where the evidence on the question of damages is conflicting, and there is substantial evidence to support the verdict as to amount, the supreme court will not disturb it.

Appeal from circuit court, Jackson county; E. L. Scarritt, Judge.

Action by Lafayette Traber against Charles Hicks and Samuel Foster to recover damages for alleged fraud and deceit. From a judgment for plaintiff, defendants appeal. Reversed.

Kinley & Kinley, for appellants. L. H. Waters, L. C. Slavens, and G. A. Vandeveer, for respondent.

MACFARLANE, J.

This action is for damages on account of alleged fraud and deceit. A trial resulted in a verdict and judgment for plaintiff, and defendants appealed. The petition charges, in substance, that plaintiff was the owner of a lot in Kansas City 100 by 150 feet in extent. That prior to October 8, 1889, he had offered to sell the same to one Rhodus for the sum of $13,000, of which $4,000 was to be paid in cash. That Rhodus should have the right to borrow on each half, or 50 feet front, of the lot the sum of $11,000, and secure the same by first deeds of trust on the respective lots, and plaintiff should take a second deed of trust of $4,000 on each, to secure the balance of the purchase price, and that the $11,000 to be borrowed on each lot should be applied to the erection of buildings thereon. That defendants, being fully advised of this offer, agreed with Rhodus to lend the money on the terms offered by plaintiff, and agreed with plaintiff that they would, so far as possible, see that the money so to be loaned should be applied in the erection of the buildings, according to the offer of plaintiff. With these agreements plaintiff sold the lots to Rhodus, who paid $4,000 cash, and executed and delivered to defendants first deeds of trust for $11,000 on each half of the lot, and to plaintiff second deeds of trust for $4,500 each thereon. That, prior to the consummation of this sale and the execution of these deeds, said Rhodus and defendants entered into an agreement, by which $3,000 of each deed of trust should be paid to Rhodus, or his order, on the completion of the foundation of said buildings, when the foundations would in fact cost less than $600 each. That Rhodus, by an assignment of said contract as collateral, obtained the money from one Otis with which to make plaintiff the cash payment of $4,000 on said sale. That, upon completion of the foundations of said buildings, defendants, upon the order of said Rhodus, paid Otis the sum of $6,000, well knowing that the foundation did not cost to exceed the sum of $600. Plaintiff charges that the agreement between Rhodus and defendants was made and carried out with the fraudulent intent and purpose of making the cash payment on the purchase of the lots out of the money borrowed from defendants, and secured by a first deed of trust on the lots. Plaintiff further charges that Rhodus failed to complete said buildings, and is himself wholly insolvent; that defendants, for value and before maturity, assigned their notes and first deeds of trust to an innocent purchaser; that the property had been sold under the power contained in the deeds of trust, and by reason of all which plaintiff had been defrauded out of his property, to his damage in the sum of $12,000. The answer was a general denial. The evidence tended to prove the allegations of the petition. The instructions given for plaintiff, which were quite lengthy, authorized a recovery upon proof of the facts charged in the petition. At the request of defendants the court instructed the jury that "there can be no recovery unless the jury find and believe from the evidence that Hicks and Foster, on or about October 2, 1889, entered into a fraudulent conspiracy with Rhodus to enable Rhodus to apply $4,000 of the money borrowed by him of Hicks on the cash payment to be made by Rhodus to plaintiff, instead of putting the same into the erection of the buildings." The court also gave the following instruction asked by defendants: "The jury are instructed that if they find and believe from the evidence that Hicks and Foster paid the money provided for in the building loan, except the defendants' commission, over to Rhodus in good faith, expecting, and having reason to believe, that Rhodus had expended it, or intended to expend it, in paying for labor and material for the buildings, or paid it out on bills or claims for material that had gone into the buildings, or was represented to Hicks and Foster to have gone into the buildings, and that Hicks and Foster honestly believed had gone into the buildings, then your verdict should be for the defendants."

1. On the trial the deposition of Edward T. Rhodus was read in evidence by plaintiff. It appears that this deposition was taken in Chicago. During the cross-examination it was developed that witness, on his direct examination, had consulted certain written memoranda, which he said were prepared partly by himself, and partly by some one else. These memoranda the witness refused to allow counsel for defendants to inspect, and refused to allow the notary to attach to the deposition. For these reasons defendants objected to the reading of the direct examination of the witness. This objection was first made when plaintiff offered to read the deposition upon the trial. The objection was...