McCOMB, J. From a judgment in favor of plaintiffs after trial before the court without a jury in an action to rescind a contract of purchase of real property defendants appeal.
Viewing the evidence most favorable to plaintiffs (respondents), the essential facts are:
Defendant Jotham Bixby Company was the owner of a subdivision known as Bixby Terrace. Defendant Deeble was a sales agent for such subdivision and defendant Smith was a duly authorized salesman under the direction of defendant Deeble. Plaintiff J. W. Wood accompanied by defendant Smith visited the Bixby Terrace subdivision and viewed certain lots which were for sale. Mr. Smith stated to Mr. Wood that the property was not subject to any assessments or liens of any nature whatsoever excepting county taxes. Thereafter Mr. Wood agreed to purchase four lots in the tract and a deed was delivered to him September 15, 1937. Early in November plaintiffs received from the Cerritos Park Association a notice of a $60 assessment levied against the lots which they had purchased. November 8, 1937, plaintiffs served on defendants a notice of rescission of their contract.
Defendants rely for reversal of the judgment on these propositions:
First: There is no substantial evidence to sustain the following finding of facts of the trial court:
“It is true that plaintiffs were induced to purchase said, property by the representations made by the Deeble-Chapman Company through its agent, Percy E. Smith, and by the written representations of the defendants, Deeble-Chapman Company and the Jotham Bixby Company. It is true that said representations that there would be no assessments, [296]liens or charges against said property, save and except the Los Angeles County taxes, induced the plaintiffs to purchase said property and to pay to the defendants the sum of five thousand seven hundred ($5,700.00) dollars. It is true that said representations that there would be no assessments, liens or charges against said property, save and except the County taxes ivere false and untrue and known by the defendants and each of them to be false and untrue. It is true that said. representations that there would be no assessments, liens or charges against said property, save rnd except the County taxes, were made with the intent to deceive the plaintiffs and induce the plaintiffs to purchase said property. That the Cerritos Park Association was formed undet the provisions of a tract restriction which is known as declaration No. 1. That said declaration No. 1 empowered a committee to levy and collect assessments against the property hereinabove described. Said declaration No. 1 was recorded on the 18th day of March, 1937; that prior to the 23rd day of March, 1937, the defendants and each of them knew of the existence of declaration No. 1. It is true that said defendants purposely withheld advising the plaintiffs of the existence of declaration No. 1, or of the Cerritos Park Association and of its right to levy assessments on the above-described property. It is true that during the month of October, 1937, an assessment was levied against the hereinafter described property purchased by the plaintiffs to the damage of the plaintiffs herein.”
Second: The trial judge committed prejudicial error in refusing to permit defendants to introduce evidence that the assessments levied against the property actually increased the value of said property.
Third: A pur chase and sale contract may not be rescinded in the absence of proof that plaintiffs were actually damaged by the misrepresentations which form the basis of the action for rescission.
Fourth: The acceptance by plaintiffs of a deed and certificate of title showing that the property was subject to an assessment constituted a waiver of plaintiffs’ right to rescind the contract on the ground that defendants had represented that the property was not subject to <my assessments other than county taxes.
[297]Defendants’ first proposition is untenable. An examination of the record discloses there was substantial evidence considered in connection with such inferences as the trial judge may have reasonably drawn therefrom to sustain every material finding of fact set forth above, together with all other facts upon which the judgment was predicated. For example, plaintiff Wood testified in response to his query, “Will there be any other taxes and assessments?” that defendant Smith replied, “No, there will not be, outside of county taxes.”
He further testified as follows:
“Q. Was there any discussion with Mr. Smith concerning this $10.00 assessment that he has just mentioned? A. There was not, because had there been, I would not have bought the property, because I would not consider buying anything, real estate or otherwise, having an assessment attached to it, that I would not know anything about.
“Q. Would you say that he did or did not tell you about the $10.00 assessment ? A. Nothing ever mentioned about an assessment.”
Defendants’ second proposition is likewise untenable. Defendants offered to prove by a national planning expert that the assessments which the Cerritos Park Association was authorized by the deed to levy against the property which defendants had purchased, instead of being a detriment to the property in fact enhanced its value. This testimony was properly excluded, since it was not material to any issue before the court. In a rescission action the question of whether the misrepresentations are of value to the plaintiff are not involved. It is a simple question of whether or not defendant has in fact made material misrepresentations to plaintiff, and in the instant case the misrepresentations were clearly material.
In 26 Corpus Juris, (1921) page 1183, section 90, the rule is thus stated:
“ ... it is generally held that pecuniary damage is not essential to fraud available as the basis for rescission of a contract, the necessity or absence of necessity for proving damage being recognized as a distinction between an action for deceit and one for rescission.” (Italics added.)
[298]In California Credit etc. Corp. v. Goodin, 76 Cal. App. 785, page 793 [246 Pac. 121], the court says:
“Nor, in a case of this character, where the consideration has not passed, is it necessary for the defendant to plead and prove damage. (Kelly v. Central Pac. R. Co., 74 Cal. 557, 561 [5 Am. St. Rep. 470, 16 Pac. 386]; Munson v. Fishburn, 183 Cal. 206, 218 [190 Pac. 808]; Vulcan Fire Ins. Co. v. Jorgensen, 33 Cal. App. 763 [166 Pac. 835].) This statement is to be understood as meaning that damage in such a case—that is, where the effect of the defense set up would only be to vitiate or destroy the binding force of the contract on the ground of fraud and compensation by way of damages is not sought—need not be specially pleaded or proved. O'f course, in all such eases damage or injury is of the essence of the action. Every transaction brought about by fraud must result in damage or injury to the party who has thus been drawn into it. Damage necessarily follows from the fraud. This is so whether substantial damage susceptible to appraisement in terms of money has or has not resulted.” (Italics added.)
Again in California C. & C. Corp. v. Carpenter, 77 Cal. App. 18, page 28 [246 Pac. 126], the court says:
“The second proposition urged by plaintiff for a reversal, as indicated above, is that, in order to prevail in this action, it was essential that defendant should plead and prove that he suffered substantial or some actual damage from the fraudulent representation whereby, it is alleged, plaintiff’s assignor induced defendant to execute and deliver to it (the' packing company) the notes in suit. The precise question thus submitted is considered and determined against the position of plaintiff here in the opinion of this court in California Credit & Collection Corp. v. Goodin, supra, and the cases therein cited. Nothing further of special force can here be added to what is said in the opinion in that case upon the proposition.
“We have been shown no just reason for disturbing the result arrived at below, and the judgment is therefore affirmed. ’’ (Italics added.)
In Spreckels v. Gorrill, 152 Cal. 383, page 389 [92 Pac. 1011], our Supreme Court states the law thus:
[299]“Mr. Pomeroy says: ‘If any pecuniary loss is shown to have resulted, the court will not inquire into the extent of the injury; it is sufficient if the party misled has been very slightly prejudiced, if the amount is at all appreciable. ’ (2 Pomeroy’s Equity Jurisprudence, sec. 898; Wainscott v. Occidental Assn., 98 Cal. 253, 255 [33 Pac. 88].) If the defendant desired a more explicit statement showing the amount of the pecuniary loss he should have presented the objection by means of a demurrer for uncertainty in that particular. The fraud is the essential thing; the precise amount of damage being of secondary importance. (Wainscott v. Occidental Assn., 98 Cal. 253, 257 [33 Pac. 88].)” (Italics added.)
Defendants’ third proposition is also untenable. The law is settled that a party to a contract may rescind the same when his consent to the contract was obtained by the fraud of the party as to whom he rescinds. (Sec. 1689, subd. 1, Civ. Code.) In the present cáse Mr. Wood testified that he would not have purchased the property but for the misrepresentations which were made to him by defendants.
The final proposition urged by defendants will not be considered by this court for the reason that the claimed defense was not properly urged before the trial court. The law is settled that waiver is an affirmative defense and a defendant relying thereon must set it up in his answer. (Wienke v. Smith, 179 Cal. 220, 225 [176 Pac. 42]; 25 Cal. Jur., (1926) 931, sec. 6, note 17; 11 Cal. Jur. Ten-year Supp. (1936) 306.) In the present case defendants did not plead in their answer or the amendment thereto a waiver. Therefore, applying the rule of law above stated, they have waived the right to urge the same before this court.
An examination of the record in the instant case shows it to be exceptionally free from error.
For the foregoing reasons the judgment is affirmed.
Grail, P. J., concurred.