Wolfersberger v. Miller

• Decision Date: 05 June 1931
• Docket Number: 29358
• Parties: George S. Wolfersberger v. George W. Miller, G. M. Hansen, McCanless-Miller Realty Company, Gregg Realty Company, William D. Snyder and Guy H. McCanless, Appellants
• Court: Missouri Supreme Court

39 S.W.2d 758

327 Mo. 1150

George S. Wolfersberger v. George W. Miller, G. M. Hansen, McCanless-Miller Realty Company, Gregg Realty Company, William D. Snyder and Guy H. McCanless, Appellants

No. 29358

Supreme Court of Missouri

June 5, 1931

Respondent's Motion for Rehearing Overruled April 14 1931.

Respondent's Motion to Modify Opinion Overruled April 14, 1931.

Respondent's Motion to Transfer to Banc Overruled June 5, 1931.

Appeal from Jackson Circuit Court; Hon. Willard P. Hall Judge; Opinion filed at October Term, 1930, March 25, 1931 motion for rehearing and motion to modify opinion overruled April 14, 1931; motion to transfer to Court en Banc overruled at April Term, June 5, 1931.

Reversed and remanded.

Burns & White and Rosenberger, McVey & Freet for appellant Hansen.

(1) The court erred as to defendant Hansen in giving to the jury Instruction C-1, because the instruction submitted an erroneous measure of damage in authorizing recovery of the difference in market value between the Texas properties and the Kansas City apartments. (a) The case was submitted on the theory of conspiracy in connection with the obtaining by an agent of a secret profit, and the plaintiff was entitled to no more than the benefit of the agent's bargain. (b) The measure of damages submitted denied to defendant Hansen the amount of his option price, and mulcted him of the sum of $ 5,750. (c) Plaintiff's evidence fixed the market value of the apartments at much less than the actual encumbrances, and thereby denied to defendant Hansen the benefit of the money paid out by him, and gave to plaintiff a greater sum than included in the bargain made by Hansen. 2 C. J. 703; Thompson v. Lyons, 281 Mo. 456; Boston v. Simmons, 150 Mass. 461; Rorebeck v. Van Eaton, 90 Iowa 82. (2) The court erred in failing to remove from the minds of the jury the highly prejudicial evidence of and concerning misrepresentations affecting the construction and cost of the apartments. (a) Plaintiff's evidence was to the effect that the apartments were poorly constructed, and many defects existed, and the construction cost was only $ 13,500 for each building, and the total market value of the two apartments did not exceed $ 35,000. (b) All of this evidence entered into the mind of the jury in fixing the market value, and was highly prejudicial and inflammatory, and the court erred in failing to withdraw such evidence from the jury in connection with the issue of damage under the theory submitted. (3) Failure to remove the prejudice created in the minds of the jury by plaintiff's evidence of shoddy work, defects and low cost, was reversible error. Meyer v. Lewis, 43 Mo.App. 417; Mueller v. Weitz, 56 Mo.App. 36; Cobb v. Transportation Co., 12 Mo.App. 130; Leahy v. Lemp, 214 S.W. 228; Hawman v. McLean, 139 Mo.App. 429; Wojtylak v. Coal Co., 188 Mo. 260; State v. Rothschild, 68 Mo. 52.

Henry S. Conrad, L. E. Durham and Hale Houts for other appellants.

(1) The court erred in not directing a verdict for these appellants and each of them. (a) Plaintiff's right to recover is to be measured by the theory of Instruction C-1. Eversole v. Railroad, 249 Mo. 529; Denkman v. Fixture Co., 289 S.W. 596. (b) Plaintiff was put to an election of three remedies: rescission, accounting from defendant Hansen, or action for damages for fraud and deceit. He elected to sue for damages for fraud and deceit. Instruction C-1 was a departure from the petition. It proceeded upon the theory of an accounting for the profits earned by Hansen, and authorized judgment against the other appellants who were not agents, received no profit and were not liable in an accounting. 2 C. J. 703; Leimkuehler v. Wessendorf, 323 Mo. 65, 18 S.W.2d 451; McLain v. Parker, 229 Mo. 92; Marshall v. Ferguson, 94 Mo.App. 180; Houx v. Russell, 10 Mo. 246; Brown v. Lead & Zinc Co., 231 Mo. 166; Metropolitan Paving Co. v. Investment Co., 309 Mo. 638; Thomas v. Newcomb, 221 P. 226; Barnes v. McMullins, 78 Mo. 275; Gash v. Mansfield, 26 S.W.2d 131; Degonia v. Railroad, 224 Mo. 589; State ex rel. v. Ellison, 270 Mo. 653; Kitchen v. Mfg. Co., 20 S.W.2d 682. (c) The evidence did not make a case for the jury against the appellants other than Hansen because of any breach of Hansen's duty to plaintiff as plaintiff's agent; and Instruction C-1 did not hypothesize a case for the jury against the defendants other than Hansen. Dillon v. Hill, 178 S.W. 86; Miller v. John, 111 Ill.App. 56. (d) Plaintiff was not entitled to recover against the appellants other than Hansen upon the evidence or under Instruction C-1, because the evidence failed to show and the instruction failed to require a finding that plaintiff relied upon the alleged deception submitted and was induced thereby to enter into the transaction in question. Priest v. White, 89 Mo. 616; Remmers v. Remmers, 217 Mo. 557; Simpson v. Burnett, 299 Mo. 243; Mosanto Chemical Works v. Lead & Zinc Co., 253 S.W. 1009; Miller v. John, 111 Ill.App. 56; Meachem on Agency (2 Ed.), sec. 1188; Emmons v. Alvord, 177 Mass. 466; Metropolitan Paving Co. v. Investment Co., 309 Mo. 638; Fuchs v. Leahy, 9 S.W.2d 900; Stufflebaum v. Peabler, 274 S.W. 929; Davis v. Forman, 229 Mo. 51. (e) Irrespective of any question of pleading, and whatever may have been the court's theory as to the nature of the cause of action attempted to be submitted by Instruction C-1, plaintiff was not entitled to recover against the appellants other than Hansen for any breach of Hansen's duty, unless they had knowledge of and participated in that breach of duty. Instruction C-1 did not require the jury to find such knowledge and participation, and as a matter of law the evidence entirely failed to show any such knowledge and participation on the part of any defendant other than Hansen. Fuchs v. Leahy, 9 S.W.2d 900; Stufflebaum v. Peabler, 274 S.W. 929; Davis v. Forman, 229 Mo. 51. (f) Assuming for the sake of argument that there was some evidence tending to show that appellant Snyder had knowledge of the fraud (which we deny), appellants Miller, McCanless and McCanless-Miller Realty Company were not charged with his knowledge nor responsible for his acts. They had no actual knowledge of the alleged fraud and in no way participated. They were not liable under the evidence, and they were not liable under the theory of Instructions C-1 and C-3. Ray County Savings Bank v. Hutton, 224 Mo. 42; 6 C. J. 641; Hoover v. Wise, 91 U.S. 108. (2) Instruction C-1 was erroneous in respect to the measure of damages. Thompson v. Lyons, 281 Mo. 456. (3) The court erred in admitting incompetent and immaterial evidence offered by the plaintiff bearing upon the value of the property and in respect to the parties. Addis v. Swoffard, 180 S.W. 554; City v. Hunze, 314 Mo. 463; Leavell v. Leavell, 114 Mo.App. 35; Schafer v. Ostmann, 148 Mo.App. 651; Stansberry v. McDowell, 186 S.W. 761; Washington Light Co. v. Lansden, 172 U.S. 553.

C. W. Prince, James N. Berry and W. H. Allen for respondents.

(1) Defendant Hansen submitted an instruction, H-9, which was given by the court to the effect that the jury should find for all of the defendants if the equity in the flats was equal in value to the equity in the Texas property. Instruction H-4 was similar. The other defendants in the case made no objection and saved no exception to the giving of these instructions nor did they complain of them as error in their motion for a new trial (R. 1172), nor do they assign error here because thereof. All defendants, however, charge the trial court with error in giving Instruction C-1 which predicated plaintiff's right of recovery and measure of loss upon the respective values of the Missouri and Texas properties. Plaintiff's damage lay in the loss of the benefit of his bargain and was measurable by the difference between the actual and the represented value of the flats he received. The instructions H-4, H-9 and C-1 increased plaintiff's burden. Our point of law is that where an instruction is given at the request of one defendant containing a vice that inheres in an instruction given by the court of its own motion, it may not complain of the error in the court's instruction. Nor may its co-defendants, who failed to object to its said instruction, attack the same vice in the instruction given by the court. Metropolitan Paving Co. v. Inv. Co., 274 S.W. 823. (2) Only one of the defendants, to-wit, George M. Hansen, was the agent of the plaintiff in the transaction in question, but said agent was aided and assisted in the perpetration of the fraud by acts of concealment and other fraudulent acts on the part of the other defendants. The other defendant knew of the fact that the defendant Hansen was pretending to act as the agent of the plaintiff. Third persons aiding an agent in the commission of a fraud upon his principal, are liable for fraud to the same extent as is the agent himself. Leimkuehler v. Wessendorf (Mo.), 18 S.W.2d 445. (3) The title to the flats was not in the straw man Adams at any time, but was in McCanless-Miller Realty Company. This company on October 2, 1922, conveyed by warranty deed to Helen Gille, McCanless personally signing the deed as president of the company. Helen Gille put a second mortgage of $ 9,500 on each of the two flats payable to Melissia Roach, still another straw. Two months later, to-wit December 16, 1922, the McCanless-Miller Company sold these notes to its president and vice-president, the defendants, Guy H. McCanless and George W. Miller, at a discount of fifty per cent. McCanless and Miller were the owners of all of the stock of the corporation. If there was a "ready market" for the flats at a price of $ 25,000 to $ 27,000, as defendants' witnesses testified and there had been no fraud in the transaction with plaintiff in which the notes had...