Civille v. Bullis

BURKE, P. J.

This is an action for rescission of a contract of sale of a business and for damages brought by Deane L. Civille and Evelyn M. Civille (Buyers) upon alleged failure of consideration and fraud of Harry E. Bullís (Seller), Defendants and respondents Joseph DuBrow and Dr. Seymour Myers, encumbrancers of the business, took no part in this appeal.

The facts relative to the issues raised on this appeal viewed most favorably to Buyers are as follows:

Buyers and Seller negotiated for the purchase and sale of a car wash business in Encino, California. The written agreement of the parties was set forth in escrow instructions wherein Seller obligated himself to obtain for Buyers valid assignments of the leases to the premises. The leases prohibited assignment without the consent of the lessor. Seller had been

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the lessee in the said leases which had enabled Seller to operate the car wash. The assignments were therefore essential in order to enable Buyers to operate the ear wash business.

The first escrow agreement is dated November 28, 1958. On December 30, 1958, an amendment to the escrow instructions was signed whereby Seller obligated himself to furnish the lease assignments outside of escrow thereby enabling escrow to close, and further enabling Seller to obtain $10,000 deposited into escrow by Buyers. Buyers went into possession of the ear wash business prior to close of escrow. They operated it, made repairs to machinery and expended other sums required in the operation of the business in the belief that their possession of the premises was justified under the promised assignment of the leases.

On Api’il 8, 1959, Buyers served upon Seller a notice of rescission and abandoned the premises, whereupon Seller retook possession.

One of Buyers, Deane L. Civille, testified that Seller orally represented to him on numerous occasions, both before and after the close of escrow, that the lessor had consented to the assignment of the leases and had further promised to furnish written assignments to the leases.

Ronald Civille, son of Buyer, Deane L. Civille, testified that Seller told him that he had talked to the lessor and she agreed to assign the leases to Buyers. He further testified that Seller assured him there was nothing to worry about. Seller stated on numerous occasions that he had the assignments.