Weaver v. Blochberger, 30686.

• Decision Date: 23 November 1948
• Docket Number: 30686.
• Citation: 31 Wn.2d 877,199 P.2d 589
• Parties: WEAVER et ux. v. BLOCHBERGER et ux.
• Court: Washington Supreme Court

199 P.2d 589

31 Wn.2d 877

WEAVER et ux. v. BLOCHBERGER et ux.

No. 30686.

Supreme Court of Washington

November 23, 1948

Department 1

Action by I. S. Weaver and wife against Herman F. Blochberger and wife for rescission of conditional purchase of retail business and restoration. Judgment for plaintiffs, and defendants appeal.

Judgment affirmed.

Appeal from Superior Court, Pierce County; F. G. Remann, Judge.

Ralph M. Rogers, of Tacoma, for appellants.

Louis J. Muscek, of Tacoma, for respondents.

MALLERY Justice.

The defendants had offered a small community store, located at 1006 North I street in the city of Tacoma, for sale through the Harold A. Allen & Co. firm of real estate brokers. Mr Hugh Fotheringill handled the negotiations here involved for them. About July 7, 1947, he took the plaintiff Weaver, a young ex-serviceman without previous business experience, to the store and introduced him to the defendant Mrs Blochberger, and on July 12 an earnest money receipt for the sale of the business was executed. The deal was consummated September 15, 1947. It consisted of a lease of the premises for five years at $60.00 a month, together with a conditional bill of sale of the fixtures and stock of goods on hand.

Plaintiffs went into possession September 15, 1947. They paid the first and last month's rent and again paid the rent due on October 15th. They operated the store until October 29, when they caused to be served on defendants a written notice of rescission of the transaction and offer of restoration of the property. This offer was refused in writing by defendants, and on November 3 the plaintiffs closed the store and locked it up. This action for rescission and restoration followed. It is based upon fraudulent representations made to the plaintiffs to induce them to make the deal.

The first cause of action is for a recovery of the purchase price of the fixtures; the second for the recovery of moneys paid for the stock of merchandise and the third for rescission of the lease. There is no dispute as to the prices involved, excepting as to the value of the inventory that was turned back to the plaintiff. The plaintiffs alleged and proved that the defendant Mrs. Blochberger had represented to the plaintiffs that she had banked $400.00 in profits from the business for the month of August, and that she had further represented that the profits had exceeded $20.00 per day. She told Mrs. Weaver that they could make that much in the operation of the store. She claimed that there were no bookkeeping records which she could show to demonstrate the extent of the business to them, and on the trial of the case, the scattered papers she produced drew the comment from the trial court that they were of little value for such a purpose. The period of operation of the store by the plaintiffs had shown a profit of about $4.00 a day. The trial court found that there was fraud, and granted judgment to the plaintiffs from which the defendants appeal.

Seventeen of appellants' assignments of error which are directed to the findings of fact and conclusions of law need no comment other than that they are not supported by the record.

The complaint alleged that appellant Mrs. Blochberger had made a representation that she had banked a profit of $400 for the month of August. The allegation of this misrepresentation was one of the chief ones relied upon by the respondents to show fraud. Appellants contend that the court erred in admitting testimony to the effect that Mrs. Blochberger had at other times made representations that she had banked $400 profits for the months of June and July also. They contend that this was prejudicial error. We find no merit in this assignment of error. Complaints allege ultimate facts and not the detailed evidence to be introduced at the trial. The probative value of the testimony complained of is confessed by the appellants by their contention that it was prejudicial. Its competency and relevancy is supported upon the theory of it showing similar acts for the purpose of showing intent to deceive.

The representations as to the profits appellants had derived from the business were false. They took the position that such representations as were made referred only to gross income, which is a very different thing from profits. They made no attempt to prove they had made a profit of $400 per month. The record amply supports the court's finding against them in this regard.

Appellants' elaborate argument as to the elements necessary to prove fraud are not in point here. If such false representations as to previous profits are relied upon and induce one to buy a business that cannot be made to pay a comparable amount, an action for rescission based upon fraud will lie. See Frahm v. Moore, 168 Wash. 212, 11 P.2d 593, which the trial court followed, and which lays down the rule applicable in this case.

The respondents did not have sufficient cash to make the full down payment asked by the appellants. Since the appellants were to have paid the realtors' commission out of the down payment, this problem was solved by the realtors accepting their commission in the form of a promissory note made by the respondents, thus enabling the appellants to keep the full amount ot the down...