7 P.2d 1043 | Cal. Ct. App. | 1932
[EDITORS' NOTE: THIS PAGE CONTAINS HEADNOTES. HEADNOTES ARE NOT AN OFFICIAL PRODUCT OF THE COURT, THEREFORE THEY ARE NOT DISPLAYED.] *34 THE COURT.
The above action was upon a promissory note for $1800 executed by defendants to plaintiff on January 4, 1928, and payable one day after date. Defendants by their answer and cross-complaint alleged in substance that plaintiff was the owner of 160 acres of land in Monterey County; that on the date of the note one Bauman, otherwise known as Schutz, was plaintiff's agent for the purpose of selling this land to defendants; that Bauman falsely and fraudulently, with the intent to deceive and induce defendants to purchase, represented himself to be employed by the Standard Oil Company of California, a corporation, and that if they would purchase the above the corporation, through its agent (who, according to Bauman, was to arrive on the following Saturday), would lease 120 acres thereof *35 for a term of five years at an annual rental of $1200; that defendants, believing and relying upon the representations, purchased the land from plaintiff, paying therefor the sum of $3,000 in cash, and executed the note sued on the balance.
On May 8, 1928, defendants notified plaintiff in writing that they elected to rescind, and offered to reconvey the property upon the surrender of the note and the return of the amount paid, which offer was refused.
The trial court found the allegations of defendants' pleadings to be true, and that the land was of the value of $800 and no more. A judgment that plaintiff take nothing and that defendants, who had deposited in court a deed reconveying the property to plaintiff, recover the amount paid was accordingly entered.
Plaintiff, who has appealed therefrom, contends that the finding of agency is unsupported; that defendants were in default and not entitled to a rescission; that they were wanting in diligence in making a demand therefor and that their conduct in the transaction precludes relief in equity.
[1] Fraudulent representations, to constitute ground for relief, must be as to existing and material facts, predictions as to future events being ordinarily regarded as nonactionable expressions of opinion (Lawrence v. Gayetty,
While there is no direct evidence of agency there was strong circumstantial evidence of the fact. According to plaintiff, he had never met Bauman previous to the transaction in question; yet it is admitted that immediately thereafter he paid the latter $1500. This, plaintiff claims was a loan made without security and not evidenced by a note or otherwise, but which Bauman agreed to repay within a few days. It further appears that the amount was drawn from plaintiff's bank account by a check payable to cash, not indorsed by Bauman, and was paid to the latter in currency. On the back the plaintiff had written the word "land". Some time previous to the trial plaintiff's deposition was taken. At this time he denied that he had withdrawn the above amount from the bank since the deed was given. He further denied that hegave Bauman any check or money or any part of the proceeds of the sale. When confronted at the trial with his account at the bank showing the transaction he offered as an explanation of his previous statement that he had not given Bauman any part of the proceeds of the sale, that the money in question was a loan and not a gift, further stating that Bauman represented that he needed the money to enable him to ship certain drilling machinery from Los Angeles to the land, and that the amount would be repaid when he returned with certain persons who, he *37 claimed, were prospective purchasers of neighboring land owned by plaintiff. In addition to the above it appears that no effort to discover Bauman's whereabouts after the transaction was made by plaintiff, and, according to his testimony, the purchase price of the land was nearly three times its value for the purpose for which it was being used, namely, stock-raising.
[3] While the presumption is always against fraud, and the evidence in support of such an allegation must do more than create a mere suspicion (Wendling etc. Co. v. Glenwood etc.Co.,
[4] Agency may be implied from acts and circumstances (Anglo-California Bank v. Cerf,
[5] Section
The note was not returned, and nothing further appears to have been done until the notice of rescission was given, following which on May 31, 1928, suit was filed on the note.
[7] We find no merit in the further claim that defendants, having failed to pay the note, which became due on the day following the completion of the transaction, were in default, and consequently not entitled to rescind. As held inAmerican-Hawaiian Eng. Co. v. Butler,
[8] Pending the negotiations and prior to a certain visit to plaintiff's home Reich asked Bauman whether he should *39 tell plaintiff of the oil project. Bauman replied in the negative, stating that he would tell plaintiff something else. Following this Bauman informed the plaintiff that he wanted the land for the purpose of raising pecans, and Reich, who was present, remained silent. It is claimed that by his failure to advise plaintiff of his real object in making the purchase defendant was guilty of bad faith, and should be refused relief in equity.
It is clear from the testimony that plaintiff was not deceived by Bauman's statement and that no reliance was placed thereon; in fact he makes no such claim; and in view of the finding that the relation of principal and agent existed between them it is manifest that the object of the statement as well as the admonition that Reich say nothing was to mislead the latter as to the true situation, and that no deception was or could have been practiced on the plaintiff. As stated in Pomeroy's Specific Performance of Contracts, section 218, one element of misrepresentation, alike requisite in every species of remedy, legal or equitable, is that it must have been relied upon by the party to whom it was made, and must be so far an immediate cause of the contract that without it the agreement would not have been completed. Unless the untrue statement is believed and acted upon it occasions no legal injury. To the same effect is Kelly v.Central Pac. R.R. Co.,
We are satisfied that the findings are fully supported and no ground for a reversal of the judgment has been shown.
The judgment is affirmed. *40