Borowicz v. Hamann

214 N.W. 431, 193 Wis. 324, 1927 Wisc. LEXIS 294

• Court: Wisconsin Supreme Court
• Decided: June 20, 1927
• Status: Published

Opinion

Rósenberry, J.

We shall not make a restatement of the matters covered in the former opinion, to which reference is hereby made, but will state such additional facts as are necessary to a consideration of the questions presented for review.

The first contention of the plaintiffs here is that, this being an action at law, the court erred in reducing the damages fixed by the jury and in directing an absolute judgment for the amount so fixed by the court, the contention being that the plaintiffs are thus deprived of the right of trial by jury. In this contention plaintiffs are undoubtedly right. See Campbell v. Sutliff, post, p. 370, 213 N. W. 374.

It is next argued that, the court having failed to set aside the verdict of the jury within sixty days, the respondents are not entitled to a review of the questions whether or not the verdict is supported by the evidence or whether the court erred in failing to direct a verdict, and that as a necessary consequence the judgment entered below must be reversed and judgment must be directed in accordance with the verdict.

The defendants in this case seasonably made a motion to set aside the verdict and for a new trial. The failure oi the court to, act within the time prescribed by .sec. 270.49, Stats., did not deprive the court of jurisdiction, as is argued here, but operated as a constructive denial of the motion. It would be clearly unreasonable to hold that a party who has done everything possible for him to do is deprived of a right of review in this court because of the failure of the trial court to act seasonably. The appealing defendants, having made a timely motion to set aside the judgment and for a new trial, are on appeal entitled to a review of every question which they would have been entitled to have reviewed had the court itself denied their motion.

This brings us to a consideration of the case upon its merits. The plaintiffs are husband and wife and were at the time of the trial about sixty-four years of age. They were natives of Poland and came to this country in 1885. Mrs. Borowicz could not read nor write nor understand English and testified through an interpreter. Mr. Borowicz was able to speak English, had worked in Milwaukee for a period of about eight years as a common laborer, and in the nineties removed to Brown county, where he purchased a small farm. He bought and sold several farms, and finally in 1919 purchased the farm in question for a cash consideration of $20,500. The farm appears to have been a good, improved farm, and the plaintiff Borowicz claims that he was offered $22,000 in cash for the property just before the .trade. The farm consists' of 163 acres with farm buildings, the usual farm equipment including machinery and stock. The personal property was mortgaged for $1,800 and was worth an amount considerably in excess of that. Borowicz conceived the idea of exchanging his farm for income-producing property in the city* and at the suggestion of his son-in-law one Fournier was engaged by Borowicz to conduct the transaction. Fournier.had no car and arranged with one McKenna, then in the employ of the defendant W. P. Meachem, a real-estate dealer, to take the parties to Milwaukee in McKenna’s car, the arrangement being that Fournier and McKenna were to receive two per cent, of the valuation fixed upon the farm for trading purposes (which was $30,000), or $600, in the event that a satisfactory exchange was made. Whether this arrangement was made before or immediately after the return from the trip to Milwaukee is not clear. Borowicz’s agent then wrote to Scheuer & Tiegs, Inc., asking whether or not they could line up something in the way of flats for four different farms, among them a 163-acre improved farm, price $30,000, and advised Scheuer & Tiegs, Inc., that he was coming to Milwaukee in a few days with the owners: There is not the slightest evidence in the record that any of the persons who acted as agent for Borowicz had ever had any previous connection with Scheuer & Tiegs, Inc. Pursuant to the arrangement made by Fournier, Fournier, McKenna, and Mr. Borowicz went to Milwaukee May 23, 1921. Upon their arrival in Milwaukee Mr. Borowicz went to stay over night with his brother-in-law, who owns a shoe store; and told him he was there to look over some Milwaukee property. The-next morning Fournier and'McKenna called for him and they went to the office of Scheuer & Tiegs, Inc., and there met Mr. Scheuer. They explained to him -the situation of the Borowicz farm and .then Scheuer, McKenna, Fournier, and Borowicz, and a stranger who was also interested in the purchase of Milwaukee property, went in an automobile and looked at two or three properties, but Borowicz declined to consider the purchase of any property which included stores. Scheuer then showed them the building owned by Mr. Hamann on Washington street. Scheuer then told Borowicz' and his agents that the property produced a rental of $208 per month and that it was mortgaged for $16,000. There is some dispute in the evidence as to the reason why Borowicz did not examine the interior of the property. He says that it was because Mr. Scheuer represented that the property was rented by rich people who did not want to be disturbed by people going through the building. However, the rents paid by each tenant indicated that they were far from rich. Upon their return to Scheuer’s office a trade was discussed and Borowicz indicated a desire to exchange properties. Scheuer then drafted an exchange contract by the terms of which the Borowicz farm was to be exchanged for the Hamann property. Apparently the contract was prepared by Scheuer and left by him at his office thereafter to be executed by Borowicz. It is undisputed that Borowicz knew that the contract of exchange was not binding until signéd by his wife. Borowicz returned to Scheuer’s office after the noon hour with the understanding on Scheuer’s part that Borowicz was to be taken by Fournier and McKenna to the Hamann premises and was then to make an examination, return to Brown county, have the exchange contract signed by his wife, and, upon Scheuer being notified to that effect, Scheuer was to come to Brown county, examine the Borowicz farm, and the trade was to be concluded. During the noon hour Borowicz had talked the deal over with his brother-in-law. After the noon hour Borowicz, Fournier, and McKenna came to Scheuer’s office. Scheuer was not there and Fournier and McKenna then took Boro-wicz direct to Green Bay, giving him no opportunity to examine the Hamann property. Upon Borowicz’s return to his home and upon consultation with his wife he seems to have become doubtful as to the advisability of making the trade. He testified: “After my wife signed the contract, I got scared and I grabbed the contract and I gave it to my wife back again.” It appears from his testimony that he destroyed the contract. However that may be, another copy of the contract was produced, and finally, after several days’ solicitation by his agents, Borowicz and his wife delivered to them a signed contract. Scheuer was then notified of that fact, and some ten days or two weeks after called at the Borowicz farm and examined the same. After his examination Scheuer returned to Milwaukee and advised Hamann of the situation and the defendant Hamann went to inspect the Borowicz farm. Abstracts were exchanged, some criticism was made of the abstract of the Borowicz farm, and on June 20th Scheuer wrote Fournier that the papers had been prepared and that Scheuer and Hamann would be in Green Bay Wednesday morning, June 22d. In the meantime the signed copy of the contract had remained in the possession of Borowicz or his agents. On the 22d a further examination was made of the Borowicz farm. Finally deeds were prepared and exchanged, interest and insurance computed to June 10, 1921, and upon the adjustment Borowicz was found to owe Hamann $200.49. Hamann paid Scheuer & Tiegs, Inc., their commission; he paid no commission to any one else, nor did they divide the commission with any one else. Borowicz’s agents received their entire compensation from Borowicz. About a week after the delivery of the deeds Hamann returned to the farm and employed Borowicz to run it until it should be sold. The farm was immediately listed for sale and was sold in the latter part of August of the same year, Borowicz continuing to occupy and operate it until the time of its sale. Upon the exchange of properties being completed Borowicz employed Scheuer & Tiegs, Inc., to collect his rents and manage his Milwaukee property for him. He had at that time no present intention of occupying it himself. Scheuer & Tiegs, Inc., managed the property, collected the rents, paid the monthly instal-ments on the mortgage, rendering accurate statements of their doings down to the time that Borowicz made an exchange of the property to one Dolata, first discharging the Borowicz note to Hamann given at the time of the exchange in the sum of $200.49. The deal with Dolata fell through, and on October 4th Borowicz so advised Scheuer & Tiegs, Inc., and directed them to continue as before. In November, through the efforts of another agent, Matecki, Borowicz began negotiations with one Vandermuelen for the exchange of the Milwaukee property for a farm, the trade being completed about December 1st. The transaction with Vandermuelen resulted in a suit brought by Borowicz to cancel and set aside the conveyance of the Hamann property to Vandermuelen, in which Borowicz alleged “that Vander-muelen and Matecki had falsely represented to him [Boro-wicz] that the Milwaukee property was then in a dangerously dilapidated and run-down condition and that it was then mortgaged far in excess of its value, whereas the Milwaukee property was not in a dilapidated and run-down condition but was worth $23,000.”

This in bare outline is a history of the transaction. The case was submitted to the jury upon a special ■ verdict and the jury found that the defendants Scheuer & Tiegs, Inc., A. C. Hamann, and James McKenna conspired to defraud the plaintiff. The jury further found that Scheuer & Tiegs, Inc., A. C. Hamann, and James McKenna falsely represented that the Milwaukee property was worth $33,000; that the interior of the building was all in good condition; that it was income-producing property which would yield plaintiff over and above,expenses $100 a month to live on; that such representations were made for the purpose of inducing plaintiffs to make the exchange, and that the representations so made were false. Ten jurors were of the view that under the circumstances the plaintiff ought to have relied upon the representations, found the reasonable market value of the plaintiff’s farm at $21,000, and the plaintiff’s personal property $4,000; the reasonable market value of the Milwaukee property in June, 1921, $17,000; and that if the Milwaukee property had been as represented its value would have been $27,000. Upon this verdict judgment was entered as already indicated in the previous statement of facts in this opinion.

There is not the slightest evidence in this case to sustain the finding of the jury that the defendants Hamann, Scheuer & Tiegs, Inc., and the defendant James McKenna ever entered into a conspiracy or ever conspired to defraud the plaintiffs. There was no concert of action. It is not claimed that there was any express understanding. There was no division of proceeds or any other indicia of a fraudulent conspiracy. The finding as to conspiracy should have been set aside upon any possible theory of the case. The remaining findings of the jury are quite clearly colored by, if not the necessary result of, the finding of conspiracy, so that in any event the judgment in this case must be reversed. While conspiracy may be established by inference and it most frequently cannot be proved by direct evidence, there must be some basis upon which a finding to that effect may rest. It stands undisputed in the evidence that Borozmcz employed Fournier as his agent, that Fournier then brought McKenna into the transaction, that Meacham was an associate of the defendants Frank Dul'ik and James McKenna, and that the defendant Dulik was employed by McKenna and his asso-' ciate to procure the signature of Mrs. Borozmcz to the contract prepared by Scheuer. There is not a scintilla of evidence that there was any communication between plaintiff and Scheuer after plaintiff left Scheuer’s office with the understanding that plaintiff was to return and procure the wife’s signature to the contract prepared by Scheuer until Fournier telephoned -Scheuer that Mrs. Borozmcz had signed the contract. In the meantime Borozmcz had repented of the deal, had refused to deliver the contract, and had torn up the first copy of the contract signed by his wife. To say that he thereafter relied upon any statement made by Scheuer & Tiegs is to ignore the necessary implication which must be drawn from the undisputed facts. It was wholly through the efforts of Fournier and his associates that the signatures of Boro-wicz and his wife were finally secured. Borowicz was not a simple-minded, unsophisticated farmer, — he understood business well enough to fix a high trading value upon his farm property. Borowicz had lived in Milwaukee eight years and there purchased land and built a home and sold it, making $300 in the transaction, had exchanged property in Brown county a number of times, always very much to his advantage. Upon one farm he ran and operated a saloon for ten years, served three times as town clerk, and was upon the whole a man of more than average experience. He was shrewd and resourceful. That his own agents, in order to secure their commission, were guilty of fraud if not duress there can be no doubt, but that they acted in concert with Hamann or Scheuer, or Scheuer & Tiegs, Inc., there is not the slightest evidence. Their motive was plain. They wished to secure their commission. The false represéntations found by the jury to have been made are (1st) that the property would leave Borowicz net $100 a month on which to live. Under the mortgage which was upon the Milwaukee property, the owner was obligated to pay $100 a month and interest. The income from the property was sufficient to discharge this obligation and something besides. The whole circumstances were made known to Borowicz, and the fact that he was adding $100 a month to his capital account rather than living upon it can scarcely be said to amount to a false representation. It was a matter of plain inference from the figures which were truthfully disclosed to him that the income was not sufficient to pay the $100 and in addition provide $100 for living expenses. The whole income was stated to be $208 per month.

(2d) It is further claimed that the property was represented to him as being in good condition. There is nothing to indicate that it was not in such condition as property of that class is ordinarily found. A subsequent purchaser spent $3,000 upon the property and increased her rentals to a sum exceeding $400 per month, which indicates that the property could not have been badly run down or in a dilapidated condition.

Upon the question of value we shall not attempt to reconcile the evidence. The trial court was of the opinion that under any view of the evidence the damages could not exceed $4,000. It was quite apparent that Borowicz exchanged a farm which was then of diminishing value for a city property the value of which was increasing. He was shrewd enough to foresee in 1921 the conditions which have since obtained. In addition to that he made no complaint or objection to the transaction for nearly two years, this suit having been begun in April, 1923. Within a few months after he acquired the Milwaukee property Borowicz exchanged it for other property, and from the complaint in that action it appears that he must have investigated, and at that time every material fact that was afterward discovered with reference to the Milwaukee property must have been brought to his knowledge. Yet he made no complaint to any one for over a year and three months — a very significant circumstance taken in connection with the other facts and circumstances surrounding the transaction. The uncontradicted evidence in the case shows that Borowicz did not rely upon the representations made to him by the appealing defendants, and he cannot for that reason recover in this action. Whatever injury the plaintiffs have sustained is not by reason of any fraudulent conduct on the part of the appealing defendants, but by reason of the fraud and misconduct of agents of their own choosing, who take no appeal in this case from the judgment rendered against them.

By the Court. — That part of the judgment appealed from is reversed, and cause remanded with directions to dismiss the complaint as to the defendants A. C. Hamann, Scheuer & Tiegs, Inc,, and Joseph F, Scheuer.