Macart v. San Joaquin Building & Loan Ass'n

WHITE, J. After trial without a jury of an action for damages based upon alleged fraudulent misrepresentations whereby plaintiffs were induced to purchase certain real estate, the court made findings of fact, substantially according to the allegations of plaintiffs’ complaint (as amended to conform to the proof), and rejecting the denials of defendants’ answer. Such findings were that on or about October 18, 1937, defendants offered to sell to plaintiffs a certain parcel of property located in Orange County; that prior to such purchase defendants represented to plaintiffs that the buildings located upon said property were in good and substantial structural condition and had not been impaired by termites, dry rot or otherwise. The court further found that plaintiffs had not made any inspection of said buildings prior to the purchase other than inspection of a casual nature, and that such plaintiffs did not rely upon any inspection of said buildings, but relied upon the representation of defendants, and in reliance thereon purchased the property in question. The court further found that the sills, studdings and timbers of portions of the buildings were infested and destroyed by dry rot and fungus; that the falsity of the representations was known to the defendants, and that the representations were made with intent to induce plaintiffs to purchase the property.

Judgment accordingly was entered in favor of plaintiffs in the sum of $990, and from such judgment defendants prosecute this appeal, contending that there is no evidence of misrepresentation; no proof of knowledge by defendants of the alleged condition; that plaintiffs did not rely upon [397]the asserted representations; and that no actual damage was shown.

The plaintiffs were husband and wife and the defendant W. J. Haryett was the resident manager in Los Angeles of the defendant association. The property involved was a two-story stucco building, about seven years old, containing two stores, each with an apartment above it, a three-room cottage in the rear, and a four-car detached garage, and was located at Dana Point, a beach subdivision along the coast highway in Orange County. The plaintiff IT. J. Macart lived in Los Angeles and was employed as a real estate sales manager for Dana Point Corporation, spending his Sundays at the office of the corporation about a block and a half from the property. The misrepresentations assertedly were made in two conversations with Mr. Haryett, the first of which was had about October 18, 1937, when Macart and Haryett inspected the property. Mr. Macart testified that at this time they looked at the property for ‘ ‘ about five or six minutes ’ ’; that they looked at the west store, east apartment and rear bungalow, but did not “make any examination of the construction of the building or condition of the structure”; that at that time Mr. Haryett “said the property was in nice condition”; that they could not get into one store because they could not unlock the door; that he could not see much through the windows of that store because they were dirty; that he did not attempt to get into that store or further inspect the building before the actual purchase.