Cornell v. Upper Michigan Land Co.

155 N.W. 99, 131 Minn. 337, 1915 Minn. LEXIS 850
CourtSupreme Court of Minnesota
DecidedDecember 10, 1915
DocketNos. 19,556—(195)
StatusPublished
Cited by6 cases

This text of 155 N.W. 99 (Cornell v. Upper Michigan Land Co.) is published on Counsel Stack Legal Research, covering Supreme Court of Minnesota primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Cornell v. Upper Michigan Land Co., 155 N.W. 99, 131 Minn. 337, 1915 Minn. LEXIS 850 (Mich. 1915).

Opinion

Bunn, J.

The trial court granted a temporary injunction restraining defendant land company during the pendency of the action from negotiating or transferring 20 promissory notes of the face value of $35,000 executed by plaintiff to it, and 62 promissory notes of the aggregate face value of $204,000, severally executed to it by six other men, whose rights plaintiff claimed to have under assignments from them. Defendant appealed from this order.

The application for an injunction pendente lite was heard on the complaint, answer and certain affidavits and exhibits. The complaint alleged, in substance, the following facts: Defendant land company is a Minnesota corporation with its principal place of business in St. Paul; its president, manager, and principal stockholder is H. H. Hamilton. Defendant D. M. Dilley was the agent of the land company in the transactions hereinafter mentioned. In August, 1914, defendants, wrongfully and unlawfully conspiring together for the purpose of cheating and defrauding plaintiff and Henry O. Thompson, Ray R. Thompson, F. W. Boesch, Harry E. Woodis and William J. Robinson, all residents of Blue Earth county, by selling to them as the property of said land company [339]*339certain Michigan lands, falsely and fraudulently represented to plaintiff and the others that it owned and had an unencumbered marketable title to 300,000 acres in Michigan and made various other false and fraudulent representations as to its title to, the quality and value of the land. Defendants represented that, if plaintiff or any of the persons named should purchase any part of the land on contract, he and they might select out of the entire tract the number of acres purchased by each. Dilley professed to be intimately acquainted with the land, and told plaintiff and the others that he wanted to be associated with them, and that, if they would severally buy substantial amounts, he would personally buy 10,000 acres at the same price and on the same terms it was offered to plaintiff and his associates and divide with them his commissions on the land sold to them.

Eelying upon these representations, plaintiff agreed to purchase 5,000 acres of the land, to be thereafter selected by him, for the gross price of $40,000, and a written contract to that effect was executed by both parties. Plaintiff paid $5,000 in cash, less a discount of $1,190 for his share of Dilley’s commissions, and delivered to the land company his 20 promissory notes, one due September 2 of each year beginning with 1915. At the same time the land company made other similar contracts for sales of unselected portions of the tract to the other parties, as follows: To Henry O., Eay E. Thompson and D. M. Dilley (the latter is styled “an ostensible purchaser”), 10,000 acres; to Dilley alone, 10.000 acres; to Boesch, 10,000 acres; to Woodis and Eobinson, 10,000 acres. This made a total of 45,000 acres. After the execution and delivery of these contracts and the notes for the deferred payments, on the suggestion of defendants, made as a part of their scheme of defrauding plaintiff and his associates, the latter and Dilley pooled their interests, modifying the contracts so as to permit the selection of the entire

45.000 acres in common, and formed a corporation to take over the interests of all the individual vendees. In order to make the land to be selected an even 50,000 acres, Hamilton, president of the land company, agreed to take 5,000 acres, his contract, with the others, to be assigned to the corporation, which was thereafter formed under the name “Dilley-Thompson Land Company.” Plaintiff and the othel purchasers, including Dilley and Hamilton, assigned their contracts to [340]*340this corporation. At the request of Dilley, the new corporation authorized him to select for it the lands called for by the contracts; Dilley, with the assistance of the defendant land company, made this selection, and the defendant company tendered to the Dilley-Thompson Company the specific 50,000 acres so selected. The purchasers had wanted cut-over lands, and it had been represented to them that the lands were of this character, and that they were free from ■ encumbrances. The lands selected were partly timbered lands, and were encumbered by timber reservations and permits running to various parties for long times in the future. These encumbrances were not removable, and were enumerated in the contract as exceptions from the title to be conveyed. Until the tender of this contract, neither plaintiff nor his associates had any notice or knowledge of the existence of these reservations and permits. When the contract was tendered, the Dilley-Thomp-son Company, plaintiff and his associates, refused to accept it, and the Dilley-Thompson Company hereupon reassigned to plaintiff and his associates the individual contracts. The complaint contains full and complete allegations as to the representations made, their falsity and the reliance upon them by the purchasers, and as to the fraud of Dilley in getting himself appointed to act for the purchasers in selecting the lands while he was the agent of the seller. The foregoing is á synopsis of the allegations of the complaint as to the first cause of action.

For his second cause of action, in addition to the matters contained in the statement of the first cause of action, plaintiff counted on the Thompson contract; for his third cause of action, on the Boeseh contract; and for his fourth cause of action, on the Woodis and Eobinson contract, alleging that each was procured by the fraudulent representations pleaded, and making the following allegation as the fact and terms of.the assignments by these men to plaintiff:

“That after making said payment and executing and delivering said notes, and before the commencement of this action, the vendee therein for a valuable consideration, sold said contract and unconditionally assigned the same and all his rights thereunder, in writing, to this plaintiff. That as a part of the consideration for said sale and assignment, said plaintiff agreed to assume and did assume all the obligations of [341]*341said vendee upon and under said contract and the said promissory notes given for the deferred payments thereunder.”

The relief asked was that the court rescind and cancel all of the contracts; that all of the promissory notes be canceled and surrendered to plaintiff; that plaintiff recover of defendants the amounts of the cash payments made under the several contracts, and that plaintiff have a temporary and permanent injunction restraining defendant land company from attempting to enforce any of the contracts or the notes.

The answer of the defendant land company was a very lengthy document, and it is difficult to state its substance in a few words with any accuracy. It contained a general denial, allegations denying that Dilley was its agent in making the sales, and allegations to the effect that the encumbrances on the land were at all times well known to the purchasers. The mailing of the contracts and giving of the notes was admitted, but facts were pleaded, which, if true, showed that the various cash payments were but part cash, with allowances for real estate and other property conveyed by the purchasers to the company, and certain discounts to each purchaser for his share of Dilley’s commissions on the price to the others. It is correct enough to say that the fraud was denied, and an attempt made to accuse the individual purchasers of acting fraudulently as to each other. The other defenses set up or attempted to be set up, are more material to the questions argued on this appeal.

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Cite This Page — Counsel Stack

Bluebook (online)
155 N.W. 99, 131 Minn. 337, 1915 Minn. LEXIS 850, Counsel Stack Legal Research, https://law.counselstack.com/opinion/cornell-v-upper-michigan-land-co-minn-1915.