Bernstein v. Timmerman

BARNARD, P. J.

This action gr.ew out of a real estate transaction in which the plaintiffs agreed to purchase from the defendants Timmerman a bungalow court in the city of San Bernardino, giving in part payment therefor several parcels of real and personal property. The various instruments and papers involved were placed in escrow with a title company, and later delivered to the respective parties in accordance with the terms of the escrow. This action was brought against the Timmermans and against the real estate agents concerned in the deal, for the purpose of canceling the deeds and assignments by which the several properties of the plaintiffs had been conveyed to the defendants. While the complaint contains a number of causes of action, the essence of the action is that the delivery of the instruments sought to be canceled constituted a conversion of the properties represented thereby, since a rescission had been mutually agreed upon by the parties before delivery, and that the transaction should be set aside because of fraudulent representations alleged to have been made by the defendants Timmerman. The trial court found for the defendants on every material issue and entered a judgment in their favor, from which this appeal is taken.

The only point raised is that the evidence does not sustain certain of the findings. While the appellants concede that there is a conflict in the evidence on most of the issues, they insist that there is no real conflict with respect to certain matters, this contention being based largely on the

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argument that the entire evidence discloses that the testimony of the principal defendant was not worthy of belief.

With respect to the first contention, that there was a mutual rescission and that the papers in question should not have been delivered, the following appears: On June 7, 1929, deeds and assignments covering all of the properties concerned were placed in escrow with instructions, signed by all the parties, authorizing the title company to bring down the titles, record the papers and complete the transaction. According to these escrow instructions and the papers deposited, the Timmermans were to receive the conveyances of the Bernstein properties, and the appellants were to receive a deed to the bungalow court property, giving back a trust deed thereon securing a note representing the balance of the purchase price. Later, the appellants notified the respondents that they would not go on with the deal and on June 10, 1929, all of the parties met for a conference. At this time the appellants stated that they were fearful they could not make the payments; that if there should be any large number of vacancies they would be unable to do so; and that they did not like to assume the responsibility of taking care of the encumbrances against the bungalow court. The defendants suggested handling the matter on a contract of sale instead of by deed. There is evidence that for the reasons named the parties agreed to make this change and also agreed that the monthly payments Were to be materially reduced and that the Timmermans would lease one unit of the property for a substantial amount. In accordance with this agreement the parties met at the escrow office the next day, at which time an agreement of sale was drawn and signed by the parties and left in escrow to be substituted therein for the deed. The escrow agent was instructed to use the deeds and assignments previously deposited with it by the appellants as the down payment on the contract and not to deliver the contract to the appellants until the title to the Bernstein properties was found to be satisfactory. At the same time the escrow agent told all the parties that the deal was now closed and there could be no backing out. On June 20, 1929, the respondent II. D. Timmerman complained to the appellants concerning the title to one parcel of property he was to receive and stated that they must either put up cash for that or give him other security of equal value.