Mabry v. Randolph

TAGGART, J.

A suit in equity t<5 compel restoration of property procured by fraud. The appeal is from the judgment.

The facts relied upon for recovery, and substantially as alleged in the complaint, are as follows: On June 2, 1905, plaintiff was the owner of an orange grove situated near the town of San Dimas of the value of $7,500, and against which there subsisted a mortgage of $2,500. The defendant Michaels, with whom the property was listed for exchange, on that day represented to plaintiff that the Maxon Realty" Company could effect an advantageous exchange of the grove for other property, and thereby induced plaintiff to go to the office of that company, where he met one of the Maxon.brothers, who constituted the company, and the defendant Bell, who he was told, by Maxon, was associated in business with them. The Maxon Realty company engaged to act for plaintiff and to procure an exchange of his orange grove for a house and lot in the city of Los Angeles, a written authority for which purpose was given to the Maxon Realty Company and the commissions for their services in this behalf fixed at $125. The same day .plaintiff was taken by Bell to see the house, from which, in pursuance of the scheme of appellants to cheat and defraud plaintiff, all signs and marks that would indicate its ownership had been removed, and it was represented to him by Bell and one of the Maxons that the owner thereof held the property for sale at $8,500, and would not sell for less, and that this was the reasonable value of it. It was also represented to him that the property was encumbered by a mortgage for

[424]

$3,500. The truth was, and it was well known to appellants, that the owners thereof, Winstanley by name, were offering the property for sale at $4,000, and it was mortgaged for $1,800 and no more. Plaintiff went to San Francisco that afternoon, leaving the matter, including the examination of title, in the hands of the Maxon Realty Company, as his agents, to be closed up. On the following day, appellants, acting through Bell, purchased the Winstanley property from the owners thereof, taking title to the property in the name of the defendant Randolph (who permitted her name to be used for a nominal consideration), and gave as a consideration therefor the sum of $3,800; the purchase price being made up of a small sum in cash, two notes of $850 secured by a second mortgage on the property, and the original $1,800 mortgage standing against the Winstanleys. On the 5th of June, plaintiff wrote the Maxon Realty Company not to make the exchange and attempted to recall the authority given to that company. He was informed that the agreement for the exchange had already been made, when in fact it was not made until after his letter was received. On June 14, 1905, relying on the good faith of his said agents and their representations that he was legally bound to carry out the ( transaction and as to the value at which the owners of the house and lot held the said property, he made a deed of the orange grove to the defendant Randolph and accepted a deed from her of the house and lot, and paid appellants the commission for making the exchange. During all this time the names of the real owners .were concealed from plaintiff and his inquiries as to their names unanswered or evaded; and during said time plaintiff was unacquainted with the value of property in the portion of Los Angeles city where this house was located, and appellants knew this and knew that plaintiff relied entirely upon their' judgment as to such value. On August 12, 1905, defendant Randolph, at the direction of the other' appellants, negotiated a loan of $3,200 on said orange grove, paid off the mortgage for $2,500 theretofore subsisting on the property and appropriated the residue. On August 26th, plaintiff having learned that appellants were negotiating a sale of the orange grove to the defendant Thomas, and having discovered the fraud practiced upon him in the exchange, notified Thomas in writing of his ownership of the property and that he intended to have the exchange set aside on account of the fraud. On August 29th