Wright v. Carpenter

• Decision Date: 29 March 1979
• Docket Number: No. 1334,1334
• Citation: 579 S.W.2d 575
• Parties: Kenneth WRIGHT ex ux., Appellants, v. Lawrence CARPENTER, Appellees.
• Court: Texas Court of Appeals

Page 575

579 S.W.2d 575

Kenneth WRIGHT ex ux., Appellants, v. Lawrence CARPENTER, Appellees.

No. 1334.

Court of Civil Appeals of Texas, Corpus Christi.

March 29, 1979.

Rehearing Denied April 19, 1979.

John C. North, Jr., North, White & Blackmon, Corpus Christi, for appellants.

W. DeWitt Alsup, Alsup & Alsup, Corpus Christi, for appellees.

OPINION

YOUNG, Justice.

This is an appeal from a suit alleging fraud relative to a real estate transaction. Appellees, Lawrence Carpenter and Wilma P. Carpenter, sued appellants, Kenneth Wright and Jean Wright, for fraud in connection with their purchase of appellants' home. In short, the appellees alleged that the appellants represented that their home had a roof in good condition, but that after they moved in, the roof leaked and appellees had to replace the roof. Trial was to the court without a jury and thereafter the trial court filed findings of fact and conclusions of law. The court found the Wrights liable in the amount of $867.75, which is one-fourth of the value of the new roof. We affirm.

The record fairly indicates the following events. On October 2, 1976, appellees, at that time residents of Missouri, contacted Mrs. Grant, a realtor in Corpus Christi, and asked her to show them some homes suitable for their future retirement. Mrs. Grant took the appellees to the appellants' home. Appellees expressed an interest and there in the home asked the appellants several questions concerning the age of the home and more particularly the condition of the cedar shingle roof. Mr. Wright, at trial, testified, in response to this questioning, that he told Mr. Carpenter that he had had the roof previously inspected and that the inspector told him that the roof should be good another four to five years and that he offered to give Mr. Carpenter the inspector's name. He also claimed he told Mr. Carpenter that an insurance adjuster had also inspected the roof for hail damage and that the roof was repaired in various spots with metal "step-shingles." Mr. Carpenter reported that Mr. Wright told him about an inspector and that Wright offered to give Carpenter the inspector's name, but testified that Mr. Wright then stated factually that the roof would be good for another five years and that the roof was in good shape. Mr. Carpenter also denied that Mr. Wright had said anything about an insurance adjuster, hail damage or metal "step-shingles."

The parties then went outside to observe the house, but according to undisputed testimony, several large trees covered extensive portions of the front of the roof and its condition was not visible. Appellees signed a contract to purchase the home later that same day.

A few weeks later the appellees moved into the house, had the interior walls repainted, and had the trees in the front of the house trimmed. The trimmers advised the appellees that a number of shingles were missing and that the roof was rotten toward the front of the house. Several rains followed and the new inside paint began to run in streaks from leaking water. Appellees subsequently had the roof replaced.

At trial the appellant, Mr. Wright, testified that in the three years he and his wife had lived in the house prior to the sale herein that the roof had never leaked. Also at the trial, the roofer who replaced the roof testified that the new roof would last about 20 years and that the cost of the new roof was $3471.00.

Appellants bring forward six points of error. Appellants' point 1 contends that the pleadings and evidence do not support the judgment as a matter of law. More specifically, the appellants allege that the trial court used the cost of repairs as the basis for damages rather than the damage measure provided in Tex.Bus. & Comm.Code Ann. § 27.01 (1968), ¹ or in the alternative, if it did use a proper measure of damages, there was no pleading to raise an issue as to the measure of damages used.

We first note that within the text of appellants' brief they not only concede that section 27.01 does not supersede the common law measure of damages, but also concede that appellees have pled the elements necessary to prove fraud.

Because of some apparent inconsistencies in the law, though, we will briefly consider appellants' contentions. Appellants primarily rely on Sibley v. Southland Life Ins. Co., 36 S.W.2d 145 (Tex.Comm'n App.1931, opinion adopted), for the proposition that the proper measure of damages in this case is the difference between the value of the real estate as represented and its actual value in the condition it was delivered at the time of the contract. The facts in Sibley are very similar to those in the case on appeal. There a purchaser sued to recover the costs required to complete some houses promised to be completed after the contract was entered into. But we note one primary distinguishing characteristic from the instant case; i. e., the Sibley appellate court assumed that the suit was brought exclusively under Section 27.01 (then Tex.Rev.Civ.Stat.Ann. art. 4004). With the statute as the exclusive basis for recovery, repairs (or costs of completion) were not a proper measure of damages. Accord: Huth v. Cater, 215 S.W.2d 270 (Tex.Civ.App. San Antonio 1948, writ ref'd n. r. e.); Payton v. City of Big Spring, 157 S.W.2d 975 (Tex.Civ.App. Eastland 1941, no writ); See 39 Tex.L.Rev. 108 (1960).

More recently, however, the courts have recognized the plaintiff's discretion to sue either under the statute, at common law or both. El Paso Development Company v. Ravel, 339 S.W.2d 360 (Tex.Civ.App. El Paso 1960, writ ref'd n. r. e.); (cited with approval in Stanfield v. O'Boyle, 462 S.W.2d 270 (Tex.Sup.1971); see also Woo v. Great Southwestern Acceptance Corp., 565 S.W.2d 290, 297-298 (Tex.Civ.App. Waco 1978, writ ref'd n. r. e.); Miller v. Schuman, 556 S.W.2d 97, 99 (Tex.Civ.App. El Paso 1977, writ ref'd n. r. e.); Collins v. Miller, 443 S.W.2d 298 (Tex.Civ.App. Austin 1969, writ ref'd n. r. e.); Maddox v. Worsham, 415 S.W.2d 222, 226 (Tex.Civ.App. Amarillo 1967, writ ref'd n. r. e.).

A case remarkably comparable with the instant case is Hughes v. Halliday, 471 S.W.2d 88 (Tex.Civ.App. Waco 1971, no writ). In Hughes, a real estate agent falsely represented that the air conditioning unit in a home was in proper working condition. After buying the home the purchaser found the air conditioning system inoperable and had the system replaced. The purchaser alleged fraud and sued for the cost of the repairs only. The real estate agent alleged that section 27.01 contained the only proper measure of damages. The trial court agreed and directed a verdict for the defendant. On appeal, the reviewing court held that section 27.01 is not the exclusive measure of damages in a real estate fraud case and that the cost of reasonable and necessary repairs was an adequate measure of damages.

Under the common law measure of damages, a defrauded party is entitled to recover in tort such damages as result directly from the fraud. Taylor v. Gray, 547 S.W.2d 644, 656 (Tex.Civ.App. Corpus Christi 1977, writ ref'd n. r. e.). The measure of damages is the pecuniary loss measured by the difference between the value of the thing obtained and its purchase price or the value of the thing exchanged for it; but it is also the pecuniary loss suffered otherwise as a consequence of the recipient's reliance upon the truth of the representation. El Paso Development Company v. Ravel, supra at 365.

Within this framework, we hold that part of the cost of replacing the roof herein was suffered as a consequence of the appellees' reliance on the appellants' representation, and that such was a proper measure of damage. As in Hughes, we find that the reasonable and necessary repairs are a proper measure of damages in this fraud suit to recover damages arising from this real estate transaction. See also Annot., 13 A.L.R.3d 875 (1967). We also note that appellees did, indeed, properly plead a common law action for fraud. Appellants' point 1 is overruled.

Appellants' points 2 through 6 are argued together. We will attempt to relate the arguments to the points of error. Appellants' points 4 and 5 contend there is no evidence and insufficient evidence that appellants knew their representations concerning the roof were false at the time made. This contention incorrectly assumes that for a statement to constitute the basis of actionable fraud that the maker must have known it was false when made. The maker of a false representation need not, in every instance, know it is false for the statement to form the basis for actionable fraud. Wilson v. Jones, 45 S.W.2d 572 (Tex.Comm'n App.1932, holding approved); Featherlax Corporation v. Chandler, 412 S.W.2d 783 (Tex.Civ.App. Corpus Christi 1966, writ ref'd n. r. e.). Appellants' points 4 and 5 are overruled.

Appellants, in their point 6, contend that the trial court's findings of fact ² entitle them to judgment as a matter of law. In particular, appellants point to finding number 2 which states that Mr. Wright represented to Mr. Carpenter that he had the roof inspected and Had been advised that the roof was good for another four or five years. Appellants argue that this finding conclusively shows that Mr. Wright was merely relaying information conveyed to himself and that the mere passing of information cannot form the basis for an action in fraud.

We agree that ordinarily an action in fraud may not be based on statements that are expressly represented to be made on information. Boles v. Aldridge, 107 Tex. 209, 175 S.W. 1052 (1915); 25 Tex.Jur.2d, Fraud and Deceit § 39 (1961). Such statements may, however, amount to positive statements of fact if full responsibility for their truth is assumed. Miller v. Esunas, 401 S.W.2d 150, 156 (Tex.Civ.App. Tyler 1966, writ ref'd n. r. e.). The testimony in this case raised a fact issue whether the appellants'...