*1 HUBERT G. DENNY A. Denny, Patricia husband L. JACK BRISSON
wife, Appellants, NEAUD, Realty, Estate al., et Defendants d/b/a Respondents. No. 12316.
Decided March
Garlington, Sheridan, Lohn Robert E. (argued), Missoula, Boone, Karlberg Haddon, Missoula, Jr. & H. (argued), Missoula, Mulroney, Delaney Thomas Boone & Dalby, Missoula, respondents.
MR. Opinion JUSTICE HASWELL delivered Court.
In action for on misrepresenta- based fraudulent involving residence, tion the sale of a the district court Mis- County, Green, soula the Hon. L. judge, Jack district directed judgment a favor defendants verdict and entered was judgment subsequent thereon. From denying order trial, plaintiffs appeal. a new Denny Denny,
Plaintiffs are Hubert G. and Patricia A. his wife, who sold their residence Missoula to Jack L. Brisson- Realty, one of the neaud Estate defendants. Another d/b/a Adams, is Thomas Real Exchange, defendant Estate d/b/a broker was the real estate involved who transaction. is Glacier Company, third defendant General The Insurance Adams as a real which bonded estate broker. Minneapolis to 1970, plaintiffs from Missoula late moved with for sale defendant
and listed their Missoula residence previously purchase their of that resi- who handled Adams had price $22,- year listed was before. total sale dence payment approximately involving a cash $15,350. assumption mortgage did of about The residence listing immediately January 1, 1971, so on was not sell days. sixty for an additional extended January, of- part In the defendant Brissonneaud latter promissory note he held for fered de equity in This offer communicated the residence. Minneapolis. plaintiffs in After re- first fendant Adams negotiate fusing offer, decided returned Denny talked to defendant Plaintiff Hubert to Missoula. rejected offer another defendant Bris- further, 19, plaintiff February Denny, on Hubert sonneaud. Thereafter Adams, and defendant Brissoneaud had confer- point in the office. At this there is a conflict in ence latter’s *3 concerning representations testimony and statements made Denny during plaintiff Hubert this conference. Money Beceipt any event, Agree- a written “Earnest and day by executed on the to Sell and Purchase” was same ment purchaser. and plaintiffs sellers defendant Brissonneaud as price $22,650 purchase on agreement fixed total This assignment paid: of defendant to be Bris- residence promissory in an installment note on which interest sonneaud’s makers, A. and his wife were which note was in Carl Malcolm Missouola; Bank in $750 at First State cash at clos- escrow the commission; Adams’ real estate ing covering defendant mortgage assumption outstanding of the on the residence $15,300. Subsequently, approximately defendant Adams at- completion of various documents involved in tended including assignment purchaser’s transaction interest account and the deed. the escrow in subsequently monthly payments received two on escrow", April in Malcolm note and one March and one in Since that time have received whatever. August 1971, plaintiffs
On action filed an for misrepresentations against based on fraudulent defendants Brissonneaud, Adams, gravamen of and Glacier General. The repre- their action was defendant Brissonneaud made false note, Malcolm, sentations to them that maker of was a prominent businessman, Missoula who owned in Mis- $250,000, in soula excess and certain other statements relat- ing collectability security to the for the note. Plaintiffs to hold seek defendant Adams liable on basis should that he investigation fully plain- have made thorough a more inform getting tiffs what into, were conducted himself violation of Act, specifically Montana’s Real Estate License sections 66-1937 and R.C.M. 1947. joined
Issue was case by jury came on trial on April 24, 1972, County the'district court of Missoula before Judge At plaintiff’s case-in-chief, Green. the conclusion of Judge granted Green defendants’ motions ver- directed dict and on prov- dismissal the basis that no had been Judgment was en. entered thereon and for a motion trial denied. appeal new was Plaintiffs now judg- from the ment and denial their motion for a trial. new appeal
The issue is whether the directed verdict underlying correct. proved issue whether damages. they proved damages particulars:
Plaintiffs contend in these (1) paid the $750 The loss of defendant Adams for a real estate commission; (2) residence; the loss of their (3) their *4 right to the loss of their seek recourse defendant Bris- sonneaud; (4) of moneys the loss use of the due under monthly installment under the note. Plaintiffs con- deprived present have been of a right tend with a 472 question of
possibility future and therefore the jury. have been submitted should question fraud is of fact. Section Actual it, proof party alleging burden of is The R.C. Maw, 145, plaintiffs. Reilly 146 405 P.2d v. Mont. here the damages is element of an action for 440. Proof an essential Bank, 262, 63 207 Mont. P. 623. Lee v . Nat. fraud. Stockmen’s repre Where, here, fraud is bottomed on false an action for 139 Rounds, Holland Co. sentations, this Court Furnace expressed 75, 412, 415, previously 80, Mont. 360 P.2d has requirement language: in this
“Damage, injury, prejudice or from reliance on fraudulent representation necessary element fraud whether fraud is a ground bing as a or defense.” is advanced injury damage or which the Generally speaking, the something contingent prove must more than plaintiff be must 41f, Fraud damage may may not occur. C.J.S. § may that he has p. 294. recover when he shows sus Plaintiff injury by damage having reason of pecuniary tained some occupied if position than he could have put in worse been fraud, where he does had but he cannot recover there been injury. damage has such that he show sustained placed 41a, p. 290. claim to have been Plaintiffs C.J.S. Fraud § equity in position of the their house in a worse loss exactly assignment of a note. But this not exchange buy agreement plaintiffs bargained what fori sell setting February 1971, specifically forth these terms of by plaintiffs. signed are not balance contend of the makers, note, insolvency nor the note, of the of the the value equity sustained because fraudulent but loss Plaintiffs, however, do not seek rescission of the transaction. $5,468, amount claim the which was Rather, contract. essentially at the time of the Plaintiffs, in plus essence, Adams’ commission. sale,
473 argue they nothing in received of value for their equity. fallacy argument of this lies the erroneous premise upon predicated. which it is There is evidence shortly effect that after the contract was consummated no were made the makers of the note. But it does assigned not follow escrow account which ac- quired at the time of the transaction was valueless. See: Kauf- man v. Mellon National Company, Bank and 366 Trust F.2d 326, (3d 1966). Cir.
In upon an action based party’s fraud the defrauded measure of is the difference between the actual value at the date of price. the sale and the contract Healy Ginoff, 116, 69 Mont. 123, 220 par P. 539. When the signed buy ties agreement and sell February 19, 1971, plaintiffs acquired assignment proceeds of an escrow account. assignment This had an equal ascertained value to the value of the note contained within the account. There escrow testimony is no in the record to indicate that at the time of the transaction the note was worth than less its face value. solely relied on their claim to the amount of equity in exchange. transferred simply There is no support
evidence to their claim that at the time of the trans action exchanged something nothing, i. e. their and the sales commission at proceeds valued for the of a valueless note. proven Thus simply were because there proceeds is no evidence that the of the note were value Judge less. Green was correct in stating “that in as much as have been shown in-any possibility amount—a damages perhaps, damages”. but no Accordingly, the directed verdict in favor of defendant Brissonneaud was correct.
Directing our attention to against claim Adams, note that we he is real estate broker licensed under laws state Montana. As he was the real estate plaintiffs in the broker involved sale from to defendant Bris- sonneaud, the basis of this action filed relating to defendant before the Court and the issue Act, License by provisions of the Real Estate covered
Adams is 66-1940,R.C.M. 66-1937and sections rely section seeking In basis pertinent part: provides R.C.M. guilty of any person in a civil action is found “(b) case fee, equivalent thereof, money, having received consequence profit by of a commission, compensation, *6 be act, shall in addition any provisions of this he of violation the sum of penalty not than the amount of a of less liable to so more three times the sum money not than received and so court, penalty by the received, may as be determined competent jurisdiction any of may court be recovered person any aggrieved. sustaining damages by failure of a real
“(c) Any person comply provi- to with real the broker or estate salesman estate right to commence an action act, this shall have the of sions surety, against broker and his the real estate in his own name surety, or both the broker salesman and his or the real estate directly indirectly by, employed such any salesman any sureties, of respective the broker and their specified in of act section damages sustained as result of of the real estate a result the failure 66-1937herein as comply provisions with the broker or real estate salesman brought against brok- suit is of act. all cases where salesman, shall, upon surety, his the court enter- or the er part plaintiff, of ing judgment for allow a costs attorney’s a amount as fees.” reasonable suit shown a have violation of sec Whether not necessary prove damages it is still tion R.C.M. meaning within 66- flowing from such violation of section proof only 1947. Plaintiffs contend that 1940, R.C.M. required proof that damages is re that is his real estate commission for services. Such not a ceived 66-1940(c) permits any “per- civil action law. Section against son sustaining damages” a real who estate broker fails comply provisions with the of the act. The mere fact that enough commission has been not received is in itself to meet requirements proof damages. only It not must be shown that provisions the real estate broker violated some act, but that thereby. suffered some To hold contrary otherwise would be to the intent of the stat- gives ute which remedy to one who has suffered some dam- age by virtue of certain actions of a real estate broker or sales- man. Since no have been shown aas result of the transaction with Brissonneaud discussed, heretofore likewise proof no has been shown defendant Adams.
Here, plaintiffs are still assignees the holders or of the es- crow account for which bargained. proof There is no it orwas is valueless. attempt made to contact payment the Malcolms for or contact Brissonneaud for infor- mation short, or assistance. In nothing did but sue Bris- sonneaud and proof Adams without of the noncollectibility or worthlessness of the yet escrowed note. As have damaged been as the may escrowed note fully be collectible with For interest. reasons, these the district properly court granted defendants’ motion for a directed verdict. *7 judgment of the district court is affirmed.
MR. CHIEF JUSTICE HARRISON, JAMES T. and MR. DALY JUSTICES and CASTLES, concur.
MR. JUSTICE JOHN C. HARRISON (dissenting): I dissent.