Hover v. Harout

DORAN, J.

The complaint herein sought damages for fraud in reference to various false statements and representations made to induce the plaintiff to enter into certain written agreements relating to the production of stage plays to be presented at Harout’s Ivar Theatre in Hollywood. There was a cross-complaint by appellants Harout for breach of contract; likewise, a cross-complaint by appellant Engel for breach of a contract whereby Engel was employed as manager of the Ivar Theatre. A jury found in favor of the plaintiff in the sum of $26,927.46, and, against cross-complainants Harout and Engel, whose appeals were thereafter consolidated by stipulation.

On January 12, 1950, appellants Harout, husband and wife, leased from the Cosmo-Capital Corporation, owner, an entire building in which are located the Har-Omar Restaurant operated by appellants personally, and the Ivar Theatre involved herein. The Harouts then sublet the theatre to Actors Album at a weekly rental of $600, the latter taking possession on

[861]

February 4, 1951. Of this rental, appellant Engel, a real estate broker, received a 10 per cent commission under written contract with Harout, dated May 15, 1950.

The record discloses evidence to the effect that plaintiff Hover had known Engel for many years as a theatre man, but did not know that Engel was a real estate broker acting for the Harouts. Engel first approached Hover on April 12, 1951, in reference to the production of stage plays at the Ivar Theatre, saying: “If you will let me work it out for you, put me in as your general manager for $200.00 a week . . . maybe we can get a smaller rent from Harout, and get Kennedy (the stage director) to take a little less; but, you come down and look at the theatre.” Hover was and is the owner of Giro’s Restaurant in Hollywood.

There is evidence that Engel represented to Hover that Actors Album was making a profit of $2,000 a week or more, that the lease was about to expire, that difficulty existed between the members of Actors Album, and that there was an opportunity for Hover to get the lease. Engel also stated that “This place is beautifully air-conditioned. The man put in $30,000.00 for equipment and most of it went for air-conditioning”; also that “They are selling out about every night.” That evening Hover attended the show, after which Engel took respondent to Harout’s restaurant in the same building, where the three had a conversation in a booth. Harout remarked that “We have been doing this business every night.” When Hover attended the performance, “it looked like a full house.” Harout told Hover the same story of trouble between the Actors Album partners that Engel had previously mentioned.