Hamburger v. Berman

Brooke, J. (after stating the fads). We are of opinion that the court was correct in holding that defendant by his dealings with the Benton street property, after his discovery of the alleged fraudulent representations, precluded himself from interposing the defense of fraud, his conduct amounting to an affirmance of the contract. Foster v. Rowley, 110 Mich. 63, and cases cited. All of defendant’s requests were addressed to the question of alleged fraudulent representations made by plaintiff and to the question of plaintiff’s good faith in entering into the contract. No request on behalf of the defendant was preferred upon the question of the measure of damages. Upon that point the court instructed the jury as follows: “So, gentlemen of the jury, it then comes down to a question of the value of the property. It is for you to determine, therefore, what damages the plaintiff has sustained, if any, by reason of the entering into [83] of this contract. To ascertain and determine that you are to use your judgment from the evidence in the case, the evidence that has been introduced upon the trial of the case as to the value of the respective' pieces of property. In determining this, it is your duty to determine it by a .preponderance of the evidence ; that is, by the weight of the evidence. As to both the value of the Fort street property and of the Benton street property. After having ascertained and determined by a preponderance of the evidence' the value of each piece of property, you are then to deduct from the value, for instance, on the Fort street property, the amount of the’ mortgage on that- property, and from the Benton street property the amount of the mortgage that is on that property, and the difference would be the amount of the damages which plaintiff claims to have sustained in this case. You are to arrive at the damages in that manner.” Error is assigned upon this portion of the charge, it being the contention of the defendant that under the contract the transaction amounted to a sale at a fixed price and that the plaintiff, by bringing suit on the contract, thereby ratified and affirmed all of its terms and provisions including the valuation of $20,-000 (subject to a mortgage of $4,000) which he himself placed upon the Benton street property. Under this argument it is contended that: “Plaintiff cannot now recover substantial damages for the fancied goodness of his bargain by repudiating the very material and binding contract provision as to the agreed value of his equity ($16,000.00), by claiming a substantial diminution thereof within a few days after the execution of this agreement.” It is further urged on behalf of the defendant that the question of good or bad faith of defendant should have been submitted, citing Hammond v. Hannin, 21 Mich. 374, and Way v. Root, 174 Mich. 418. We are of opinion that the contract in essence ..amounts to an agreement for the exchange of two properties. The values fixed by the respective parties upon the properties were mere estimates and were so [84] fixed merely for the purpose of effecting an exchange. Defendant’s evidence upon the question leaves no .doubt that this is what was in the minds of the parties at the time the contract was made. We are further of opinion that the situation of the defendant is not like that considered in Hammond v. Hannin, supra, but rather is governed by the case of Dikeman v. Arnold, 78 Mich. 455. The rule as stated in 2 Sutherland on Damages (4th Ed.), page 1988, is as follows: “If the person selling is in default — if he knew or should have known that he could not comply with his undertaking; if he, being an agent, contracted in his own name, depending on his principal to fulfill his contract merely because he had power to negotiate a sale; if he has only a contract of the owner to convey, or a bond for a deed; if his contract to sell requires the signature of his wife to bar an inchoate right of dower, or the consent of a third, person to render his deed effectual; if he makes his contract without title in the expectation of subsequently being able to acquire it and is unable to fulfill by reason of causes so known, as the want of concurrence of other persons, or if he has title and refuses to convey, or disables himself from doing so by conveyance to another person — in all such cases he is beyond the reach of the principles of Flureau v. Thornhill, 2 W. Bl. 1078, and is liable to full compensatory damages, including those for the loss of the bargain.” In the case at bar the defendant, when he entered into the contract in suit, knew that the legal title to the Fort street property stood in the name of Dwyer and that the property was actually owned by a corporation in which he was a minority stockholder. Nevertheless, by the execution of the contract, he undertook to convey the same. The true measure of plaintiff’s damages was the amount lost through the failure of defendant to carry out his contract, said loss to be ascertained as of the date of the breach. It is urged on behalf of the defendant that nowhere in the charge of the court are the jury instructed to determine the [85] values of the several properties as of the date of the breach. As before stated, however, no request upon that point was preferred on behalf of the defendant and it' clearly appears from an examination of the record that all of the witnesses examined as to value, testified to values at or near the time of the breach. We do not think the jury could have been misled by the charge of the court or that the case should be reversed because more specific instructions were not given. The judgment is affirmed. Ostrander, C. J., and Bird, Moore, Steere, Fellows, Stone, and Kuhn, JJ., concurred.