Burkett v. JA Thompson & Son

California Court of Appeal Apr 29, 1957 No. Civ. 22188Published

Before: Moore

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Holding. The court held that a vendor is liable for fraud when they knowingly conceal material defects in property or make positive misrepresentations regarding the soil condition, and the purchaser reasonably relies on those statements to their detriment.

Issues

Whether the evidence supported findings of fraudulent concealment and misrepresentation regarding the soil condition of the property.
Whether the purchaser's inspection of the property precluded a claim of reliance on the vendor's false representations.
Whether the trial court's award of damages for the purchaser's out-of-pocket loss was supported by the evidence.

Disposition. affirmed

Quotations verified verbatim against the opinion

“Of course, fraud is complete where a vendor knowingly suppresses a serious vice of his property which the vendee had no reason to suspect.”

“It is hornbook law that reliance by a vendee upon a positive, false, material representation entitles the vendee to recover.”

“We cannot say that the findings of concealment and misrepresentation on the part of appellant, through his agent, are not supported by the evidence.”

MOORE, P. J.

Appeal from a judgment for $5,450 damages resulting from an allegedly fraudulent sale of real property. A reversal is demanded on the ground that the evidence does not sustain a finding that defendant Wicker, through his agent, represented to his successor in interest that the house was built on original soil.

Lot 14 was on the side of a hill and was owned by Marlow Burns Land Company in May, 1946. The company employed J. A. Thompson and Son to fill the lot and grade it for the purpose of subdivision and sale. The grading and filling were finished the same month and Mr. Thompson filed his affidavit on June 26, 1946, with the Department of Building and Safety averring that the lot had been filled and compacted in accordance with engineering requirements for the construction of a one-story residential building. The lot was approved for such construction by the department on July 8, 1946.

During the period of filling and grading, Marlow Burns sold the lot to Robert A. Dewey. In October, 1950, the latter sold the lot to appellant. While Mr. Wicker was in possession, he employed one Bushman, a licensed building

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contractor, to build thereon a one-story house and garage. At the same time, at appellant’s request, Bushman called at the office of the Department of Building and Safety of Los Angeles and inquired with reference to Lot 14 and - found from the records that the lot had a compacted fill and that it had been approved by both the City of Los Angeles and the Federal Housing Authority for the construction of a one-story residence. He communicated this information to appellant. Thereafter, he dug a trench for the foundation 12 inches by 14 inches and found no evidence of an improperly compacted fill. Neither did the city inspector, nor the loan inspector who approved the excavation before the cement was poured, find such evidence. From the communications of Bushman, appellant acquired a knowledge that Lot 14 was not only approved for a building site for a one-story residence, but also that the area beneath the surface was compacted, filled ground.

In February, 1951, appellant sold the property to Mr. and Mrs. George Pemmitt for $17,500 through William Hummell. Mrs. Pemmitt testified that the salesman told the buyers that the house had been built on the

Burkett v. JA Thompson & Son

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MOORE, P. J.

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