Watson v. Molden

Citation10 Idaho 570,79 P. 503
PartiesWATSON v. MOLDEN
Decision Date24 January 1905
CourtUnited States State Supreme Court of Idaho

VERDICT OF THE JURY CONCLUSIVE WHEN-FALSE REPRESENTATIONS-RELIANCE THEREON-SHARES OF STOCK IN AN INCORPORATED CANAL COMPANY-PERSONAL PROPERTY-STATUTE OF FRAUDS-ASSIGNMENTS OF ERROR ONLY CONSIDERED WHEN.

1. Where there is a substantial conflict in the evidence on the material issues involved, the verdict of the jury must stand.

2. Where M. states to W. that certain things pertaining to the sale of shares of stock in a canal company are true, also facts pertaining to the sale of his interests in certain lands are true, and is informed by W. that he will rely upon his statements, and purchases such shares of stock and the interest of M. in the land wholly relying upon the representations of M., and such statements are afterward found to be false and resulted in inducing W to purchase. Held, that M. must respond in damages for his false and fraudulent statements.

3. Where it is shown that W. is a stranger and unaccustomed to the wants and needs of water for irrigation of desert land and M. is a real estate dealer accustomed to the necessity and amount of water per acre for the irrigation of land that he possesses in person by entry under the desert land laws of the United States, W. may rely upon the statements made by M., especially when he informs M. of his want of knowledge and information pertaining to such lands and stock.

4. Certificates of shares of stock in an incorporated canal or ditch company are personal property under the provisions of section 2611, Revised Statutes.

5. Errors will not be considered in this court where it is shown by the record that the matters complained of were not raised on the motion for new trial and urged in the lower court.

(Syllabus by the court.)

APPEAL from the District Court of Bingham County. Honorable James M Stevens, Judge.

Action for damages; judgment for plaintiff, from which and an order overruling a motion for new trial, defendant appeals. Affirmed.

Judgment affirmed. Costs awarded to respondent.

Chalmers & Jones, for Appellant.

As a general proposition, no reliance can be placed on statements as to facts which are obvious or of which the defendant party has knowledge, or which are indefinite or suspicious, or which are not regarded as statements of fact, as opinion, trade talk, etc., or where the means of knowing the truth are at hand and it could be known by exercising the diligence of an ordinary prudent man. The Idaho court in stating this principle declares that in cases of this character it must be alleged and proved "That plaintiff was fraudulently induced to forbear inquiry as to the truth of the representations of the defendant." Another means of stating the doctrine that the purchaser has no right to rely on the statements of the vendor concerning matters where the means of knowing the truth are open to both. The plaintiff relies for the support of his verdict solely upon the proposition that the defendant failed, neglected and refused to transfer or convey to him the amount of water or water right which he agreed to convey. The evidence as to what the agreement was may be considered somewhat conflicting, but at any rate it appears to have been wholly verbal, and not in writing. In Idaho ditch and water right are real property. (Idaho Rev. Stats., secs. 2825, 6007, 6009, subd. 5; Ada Co. Farmers' Irr. Co. v. Farmers' Canal Co., 5 Idaho 793, 51 P. 990, 40 L. R. A. 485; Hall v. Blackman, 8 Idaho 272, 68 P. 19; McGinness v. Stanfield, 6 Idaho 372, 55 P. 1020.) The Idaho statute making such a contract "invalid" is tantamount to making it void. (Dung v. Parker, 52 N.Y. 496, 497; Dunphy v. Ryan, 116 U.S. 495, 6 S.Ct. 486, 29 L.Ed. 703; Welch v. Whelpley, 62 Mich. 15, 4 Am. St. Rep. 810, 28 N.W. 676; Wakefield v. Greenhood, 29 Cal. 598.)

F. S. Dietrich, for Respondent.

Even when a statement by the vendor as to the value of the property is in question, it is for the jury to say whether or not the statement is one of fact, such as will subject the vendor to a charge of fraud, or is a mere expression of opinion upon which the vendee cannot rely. (American Nat. Bank v. Hammond, 25 Colo. 367, 55 P. 1090; Oakes v. Miller, 11 Colo. App. 374, 55 P. 193; Fargo Coke Co. v. Fargo Gas Co., 4 N.D. 219, 59 N.W. 1066, 37 L. R. A. 593; Mead v. Bunn, 32 N.Y. 280; Redding v. Wright, 49 Minn. 322, 51 N.W. 1056; Cabot v. Christie, 42 Vt. 121, 1 Am. Rep. 313; Speed v. Hollingsworth, 54 Kan. 436, 38 P. 497.) In view of the record in this case, as we shall see, it is perhaps unimportant to discuss the question whether or not the property to be conveyed was personal property or real estate. We concede that in this jurisdiction water rights, strictly speaking, are classed as real estate; but in the transaction under consideration it is clear that the property which the defendant contemplated transferring was personal property. It is agreed that the water right was to be in the People's Canal and Irrigation Company, a corporation. It is further conceded by all parties that such water rights were and are evidenced simply by the capital stock of the corporation, and that the rights were transferred solely by the transfer of certificate of stock, in the ordinary mode of transferring corporation stock. Upon any theory the defendant has not kept the agreement which he conceded both by his answer and testimony; that is, to transfer enough water for eighty acres. (Idaho Rev. Stats., sec. 2611; Wells v. Price, 6 Idaho 490, 56 P. 266.) This court has repeatedly recognized an oral contract, relating to transfer of water and ditch rights as binding after one party thereto has performed. (Male v. LeFlang, 7 Idaho 348, 63 P. 108; Deeds v. Stephens, 8 Idaho 514, 69 P. 534; Francis v. Green, 7 Idaho 668, 65 P. 362; Stowell v. Tucker, 7 Idaho 312, 62 P. 1033; Feeny v. Chester, 7 Idaho 324, 63 P. 192.)

STOCKSLAGER, C. J. Ailshie, J., and Sullivan, J., concur.

OPINION

The facts are stated in the opinion.

STOCKSLAGER, C. J.--

This case is here on appeal from the judgment of the district court of Bingham county, and from an order overruling a motion for a new trial. It seems that appellant in June 1902, was in possession, by virtue of a desert entry under the United States land laws, of two hundred and forty acres of land in Bingham county, his entry bearing date June 14 1902. It is alleged in the complaint that on or about June 17, 1902, defendant (appellant here) showed said lands to plaintiff (respondent here) and represented to plaintiff that he had a sufficient water right for said lands, and would sell to plaintiff all his right and interest in and to said lands, together with a good and sufficient water right, at the rate of one inch to the acre, for the sum of $ 800; that at said time plaintiff was a stranger in Idaho having recently come from Iowa, and had never lived in or had any experience in or with a country where irrigation is required for raising crops, and knew nothing about the amount of water required to irrigate an acre of land, or the mode of irrigation, all of which was well known to defendant at all times during the negotiations relative to the transaction. It is next alleged that plaintiff knew nothing about the boundaries of said tract of land and relied wholly upon the representations made by defendant in pointing out the said land and the boundaries thereof, all of which defendant well knew; that defendant represented to plaintiff that in all probability there was not more than five acres, and stated positively that there was not to exceed fifteen acres, at most, that were rough or rocky or incapable of practicable irrigation. That wholly relying upon defendant's representations that there was not to exceed fifteen acres of waste land in the two hundred and forty acres described, and that defendant would furnish with said land a good and sufficient water right for said land in the amount of two hundred and forty inches, and, being induced thereby, as defendant well knew, the plaintiff made an agreement with defendant to purchase the defendant's interest in said land, including said water right, for the sum of $ 800, and plaintiff paid to defendant said sum of $ 800, and defendant assigned to plaintiff defendant's entry of said lands in the United States land office, and delivered to plaintiff fourteen (14) shares of the capital stock of the People's Canal and Irrigation Company, a corporation; that said purchase price was paid to defendant before said stock was turned over to plaintiff by defendant. That in order to induce plaintiff to take said stock, defendant represented to him that each share of stock in said corporation entitled the holder thereof to the use of twenty-five (25) inches of water from the canal of said company; and the defendant further stated and represented that the plaintiff could conduct said water from the canal of said Canal and Irrigation Company to the said lands at a cost of not to exceed $ 50, and further represented that he, plaintiff, would have the right to conduct said water through what is known as the American Falls Canal and Power Company's canal, which lies near said lands. That after plaintiff had paid the defendant the full consideration for said land and water right, and when defendant came to deliver said certificates of stock for fourteen (14) shares as aforesaid, plaintiff objected to receiving the same, but upon the assurance of the defendant that said certificates entitled the holder to the use of water considerably in excess of two hundred and forty (240) inches, and that the same represented a good and sufficient water right for said lands, and that said waters could be conducted through the American Falls Canal Company, and could be taken...

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