Plаintiff sued for five monthly instalments of rent, and defendant counterclaimed, alleging that by the misrepresentations of plaintiff as to the rentals and operating expenses of the property leased for the year immediately prior to the negotiations, defendant was induced to execute the lease, and asking for rescission and $10,000 damages. The jury allowed something over $4,000 damages as an offset upon the rent due, rendering a- veTdiet in favor of plaintiff for $886.94. Defendant; appeals from the order denying him a new trial.
The property leased is the Globe Building, a ten-story оffice building on the comer of Cedar and Fourth streets in the city of St. Paul. The term is for 99 years, from April 1, 1917, and the rent $12,000 a year, payable in instalments of $1,000 per month in advance for the first five years, and thеreafter semiannually. Possession was taken, and is still retained by defendant. The rent was paid without objection up to April, 1919. On the trial the fraudulent representations narrowed down to statements relating to the operating expenses of the building during the year preceding the making of the lease. Defendant claiming that these were represented to be $15,500, whereas in fact they werе over $19,500. As the case was submitted, the jury virtually accepted defendant’s claim as true. On this appeal respondent cannot attack the verdict, and appellant does not takе exception to the action of the jury within the limits prescribed by the court.
The errors assigned challenge the action of the trial court in three particulars: (1) Refusing to transfer the casе to court calendar; (2) ruling that the evidence did not justify a cancelation of the lease; and (3) charging the jury that defendant could not recover damages subse
No reversible error may be found in the refusal to transfer to the court calendar. Plaintiff’s case was properly for the jury, and so was the counterclaim for damages. The motion to transfer was first made when the trial began, and we are not convinced that defendant was prejudiced by the positiоn, evidently taken by the trial court, that the evidence should be taken, and then it could be decided whether the issues should be determined by the court or by the jury. If defendant be correct in the contention that the evidence made out a case for rescission, he could have protected his rights by moving the court, either before or after verdict, for findings on that issue. This was not done.
But we are clear that the evidence conclusively established an affirmance of the lease by a continuing in possession and the payment of several instalments of rent after discovery of the alleged misrepresentations and fraud, hence equity could grant no relief. Bell v. Baker,
Defendant is shown to have had years of experience in operating large officе and 'business buildings. He was furnished by plaintiff with the rent roll of the building upon taking possession. From it he could not avoid seeing that the rentals were not what he alleges plaintiff represented them to be. This ought tó have aroused his suspicions as to the truth of representations in respect to the amount of the operating expenses, if in fact there were any representations at all upоn which he relied. Again, from the time of taking possession, his confidential agent, in charge of the premises, furnished defendant with monthly reports, showing in detail the rental income and operating exрenses. So that at the end of the first year of the lease he had a full summary disclosing the total operating expenses to have exceeded $19,500 for that year. Nevertheless, he remained in possession, paying promptly the monthly instalments of rent up to April 1, 1919, without an intimation of the existence of any cause for questioning the validity of the lease, and not until May 5, 1919, when importuned tо pay the rent in arrears,
The damages recoverable under the counterclaim were by the court’s instructions confined to those arising prior to the discovery of the fraud and the affirmance of the lease. The charge is in harmony with the rule announced in Defiel v. Rosenberg,
The instant ease illustrates the injustice that might result from the rule defendant urges. The lease contains a provision giving defendant the absolute right to terminаte the tenancy any time after March 31, 1918, upon payment of $10,000. Under defendant’s theory that a recovery could be had up to the trial, we see no ground to refuse a recovery for thе whole term. And at the rate that the jury awarded damages, for the time to which they were limited, the recovery for the whole term would necessarily amount to a very large sum. The defendant could
It is firmly established in this state that compensation and not loss of bargain is the measure of damages in actions founded on deceit inducing the making of a contract. Compensation is measured by the difference in value between what was parted with and what was received. In the case of a lease, where there are stated definite periods for which a stipulated rent is to be paid, the amount of such rent for any one period, ordinarily, measures what the tenant parts with, and the value of the use of the premises measures what he receives for that рeriod. The tenant, with full knowledge of the deceit that has been practiced, should not be permitted thereafter to enter upon any subsequent rental, interval period and hold in reserve an action for damages for the deceit. The law requires the one wronged to use diligence to prevent accumulation of damages. Morey v. Pierce,
We do not think Defiel v. Rosenberg, supra, is at all in conflict with prior decisions of this court.
Haven v. Neal,
The order is affirmed.