Groppengiesser v. Lake

Temple, C. This action was brought to rescind a contract for the purchase of land because of alleged fraudulent representations on the part of the vendor, relying upon which plaintiff made the contract; and to recover money paid under the contract. The court found all the allegations of the complaint true and all the statements in the answer and cross-complaint untrue. Defendant's motion for a new trial having been denied, he appeals from the judgment and order. He contends that a misrepresentation to justify rescission must relate to matter which induced the party to contract, and concerning which the purchaser had not equal means of information. That the parties here were entire strangers, and plaintiff was told that defendant had no personal knowledge in regard to the property, and, furthermore, defendant submitted to him all the information he himself had. The evidence is, however, conflicting upon this question. Plaintiff, according to his testimony, was a cook at San Jose. He saw the advertisement of defendant, who is a real estate agent, and called upon him to inquire. Defendant showed him a book describing different tracts which he had to sell. From these descriptions he selected a tract of eighty acres in El Dorado which in the book was marked six dollars per acre. Defendant then said that was his best piece of land, and, although it was marked six dollars per acre, he could not sell it for less than ten. He said the land was mostly level, slightly rolling, and about two and one-half acres in it possibly could not be used because it was ravines—was bad. Defendant handed him some photographs of portions of the land, and said the wood was all over the land like that shown in the picture. Also that there was a ditch on the section from which [40] water could be easily brought to it. The photographs were in evidence, but are not produced here. He also handed plaintiff a report made to defendant by an employee in which the tract is particularly described. Of course, the defendant is responsible for the statements in this report. It says that the land can be easily irrigated, that it slopes gradually south and southwest. That the natural vegetation is oak, and some small pine, and elder, and light brush that is easily cleared or that it furnishes good browse for stock. Some snow falls, but, as in all places where the fall of snow is light, it does more benefit than harm. Excellent fruit is raised throughout the locality. Every thing grows to perfection. This ought to be as attractive a residence as Auburn or Placerville. The soil is a deep red color and very similar to the soil in the best orchard and vineyards in these foothills. Some mining was done in the vicinity and some prospecting had been done on the land. This land will make an excellent home for any one. There seems to be a good demand for wood at about six dollars per cord, and the wood on this land is worthy of consideration. There was also a plat showing description, with roads, ravines, etc. This survey and plat is not brought here. Plaintiff also testified: “ The transaction was all finished on the same day when I first saw him and at the same interview. There was just one interview and that finished the entire transaction.” Thinks that was November 19,‘ 1890. The transaction was in San Francisco and the land in El Dorado county. Plaintiff first saw the land in July, 1891. He found that the land had very little wood on it, mostly underbrush, was mostly bedrock on the surface and quite hilly, the hills were very steep, and not more than two or three acres of level land. Other witnesses testified for plaintiff, one that the land is rough, with some steep hills, and bedrock at the surface in parts; only from twelve to fifteen acres could [41] be cultivated. It was also shown that there was no water on the land, and that it would cost five hundred dollars to take water from the ditch to it. The defendant naturally gave a very different account of the transaction. I notice in it, however, but one new material circumstance which is not inconsistent with the testimony of plaintiff. That is, that he told plaintiff at the first interview that he, defendant, had never seen the land. This statement being uncontradicted may be taken as true. Upon these facts is defendant entitled to a new trial? That the representations were as to material matters, such as were calculated and were plainly intended to induce the plaintiff to purchase the land, there can be no doubt. Neither can there be any doubt that the representations did induce plaintiff to enter into the contract and that defendant then knew that plaintiff relied solely upon his statements. Even upon defendant’s own testimony this is so. The representations, according to plaintiff’s testimony, were positive assertions as to matters which are not mere matters of opinion. He was told in effect that nearly all the land could be used, except two. or three acres, which, on account of ravines, would be useless. That it was suitable for a fruit ranch, and was wooded all over as shown in the photographs. As those are not brought here the presumption must be that they would tend so far as possible to support the judgment and order. These statements, there was testimony tending to show, were not true. But it is said the defendant informed plaintiff that he had never seen the land himself, and therefore plaintiff knew that he was only relating what he had heard from others. But there was a great show of care on the part of defendant to ascertain the facts. His employees had personally examined it, had surveyed it, and photographed portions of it; had even sent him some of the soil. Defendant does not say that he told plaintiff that [42] his entire knowledge in reference to the tract was derived from the documents shown him. If he had so stated, the effect would have been only to limit the representations to what appeared from these papers. It does not matter that defendant did not know that what he stated was untrue, or that he believed it to be true. According to the testimony his statements constituted all the knowledge possessed by plaintiff as to the subject matter of the sale. As they were untrue in material respects the plaintiff acting promptly may rescind. (Civ. Code, sec. 1572; Alvarez v. Brannan, 7 Cal. 503; 68 Am. Dec. 274; Bank of Woodland v. Hiatt, 58 Cal. 234. See also 2 Pomeroy’s Equity Jurisprudence, sec. 887.) As to the statement of plaintiff’s counsel at the trial, that plaintiff did not charge defendant with actual fraud, I cannot see how defendant was misled by it. It was not an admission to be used in the place of evidence, and it does not appear that defendant was prevented by it from producing any evidence that he might have produced. The complaint charges no fraud except actual fraud, and there was no testimony tending to prove fraud of any other character. Plaintiff cannot be understood as waiving his right to rescind. The phrase, actual fraud, has been loosely used by judges and law writers, and the attorneys probably had not the code definition in mind. What was meant probably was that they did not claim that defendant knew that he was stating an untruth. It is actual fraud all the same if he stated as true that which he did not know to be so, intending that plaintiff should act upon it, and then entered into the contract, knowing that plaintiff did so in reliance upon his statements, plaintiff not having other means of- knowledge. Independently of the rule that this court will not disturb the findings of fact when there is material conflict, a motion for a new trial is addressed to the sound discretion of the trial court, and that discretion will not be interfered with unless this court can see that there has been an abuse of it. We cannot say so here. [43] I think the judgment and order should be affirmed. Belcher, C., and Searls, C., concurred. For the reasons given in the foregoing opinion, the judgment and order appealed from are affirmed. De Haven, J., McFarland, J., Fitzgerald, J.