Hagadorn Investment Co. v. Rieke

155 P. 381, 60 Colo. 555, 1916 Colo. LEXIS 179
CourtSupreme Court of Colorado
DecidedJanuary 3, 1916
DocketNo. 8274
StatusPublished
Cited by2 cases

This text of 155 P. 381 (Hagadorn Investment Co. v. Rieke) is published on Counsel Stack Legal Research, covering Supreme Court of Colorado primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Hagadorn Investment Co. v. Rieke, 155 P. 381, 60 Colo. 555, 1916 Colo. LEXIS 179 (Colo. 1916).

Opinion

Bailey, J.,

delivered the opinion of the court.

In the fall of 1909, the Hagadorn Investment Company, plaintiff in error here, defendant below, solicited and induced five farmers to come to Colorado, from their respective homes in Iowa, at the expense of the company, and purchase from it land, for farming purposes, located in the same general vicinity in San Luis Valley, Conejos County, together with water shares for its irrigation.

Plaintiff below, defendant in error here, Henry J. Rieke, is one of the five, all of whom were unsuspecting [556]*556and unwary ruralists, new to this country, with no knowledge of irrigated lands, sub-irrigation, alkali, seepage, or seeped land. Plaintiff purchased approximately 600 acres, at the total contract price of $36,050.00, of which he paid $18,000.00 in cash, the balance being represented by mortgages on the land assumed by him, and promissory notes executed and secured by further incumbrances. The contracts were of absolute and unconditional sale, made direct to the plaintiff, by the Hagadorn Company, in its name and for its use and benefit.

This action was brought to rescind and cancel all contracts, deeds, mortgages, notes, etc., growing out of the transaction, because of alleged fraud, misrepresentation and deceit in their procurement. The case was tried to the court without a jury, resulting in a general finding for plaintiff, and special findings, judgment and decree as follows :

“I. That the plaintiff reposed trust and confidence in the defendant’s agents and representatives, and in their statements and representations as to the land purchased by him, to-wit: (description of land and water stock) in Conejos County, Colorado, as to the value and price thereof, and as to the condition, productivity, quality, fertility thereof, and as to the sufficiency of the water rights appurtenant thereto; that representations were made by the defendant and its officers and representatives, as to said matters, to plaintiff, which were false; that plaintiff had the right to regard said representations of defendant as to said matters as statements of facts, and that plaintiff did so regard them and rely upon them to his great injury, damage and loss; that material representations were made by defendant to plaintiff which were false and misleading, and produced an impression upon the mind of the plaintiff which was false and misleading, and which induced plaintiff to make said purchases, and that the result thereof was a fraud upon [557]*557plaintiff, entitling plaintiff to a decree of rescission of said contracts of purchase, and to other relief hereinafter specified.

II. That said lands sold by defendant to plaintiff were not worth one-half of the amount for which they were sold to plaintiff, and which they were represented to be worth by defendant; and that the great disproportion of the actual value of said lands sold to plaintiff, and its cost price to plaintiff, is sufficient to shock the conscience of the court.

III. That plaintiff was inexperienced, and wholly ignorant as to the lands purchased, and as to their condition, history, quality, productivity, and with water rights and irrigation, and had a right to rely upon the representations of defendant in regard to the same, and that plaintiff acted in sole reliance upon said representations, which said representations were false; that defendant knew of plaintiff’s inexperience and lack of knowledge as to such matters, and that plaintiff was over-reached by defendant, and that said parties were not upon equal footing.

IV. That the officers o.f defendant, and, more particularly, J. D. Hagadorn, Vice-President of defendant, were cognizant of the misrepresentations and fraud practiced, as aforesaid, upon plaintiff, and wilfully deceived plaintiff.

V. That defendant, its officers and agents, or some of them, in their representations to plaintiff concerning the lands purchased, stated that they had extensive and expert knowledge of lands in the San Luis Valley, including the lands purchased- by plaintiff; and the court finds that plaintiff had the right to take and regard defendant’s representations as to said lands as statements of fact, and not of opinion, and that plaintiff did so take them and rely upon them.

VI. The court also finds that the lands sold by defendant to plaintiff, and represented by defendant to be very fertile and productive, were, in fact, lands of very low fer[558]*558tility and productivity, that they had been thoroughly tested, and had practically little or no value for agricultural purposes; that such facts were matters of common knowledge in said San Luis. Valley, and that defendant must be charged with knowledge of said facts at the time of said sale to plaintiff.

VII. That the testimony and evidence adduced and offered by defendant fails to show said transactions fair or reasonable in this case.

VIII. That the court further finds that the total contract price for said lands was $36,050.00, and that plaintiff has paid defendant on said purchase price the sum of $18,000.00; that plaintiff is entitled to a decree for the reT payment, by defendant, of said sum of $18,000.00 and for the cancellation and return of all notes and securities for the payment thereof, executed and delivered to defendant, by plaintiff, on the said purchase price of said lands, together with interest thereon.

It is- Therefore Ordered, Adjudged and Decreed:

1. That the contracts of sale between plaintiff and defendant, and all deeds and conveyances and any and all notes, trust deeds and mortgages, executed and delivered in pursuance thereof be, and they hereby are, rescinded, can-celled, annulled and held for naught.

2. That plaintiff have, and he is hereby awarded, judgment against the defendant for the sum of $18,000.00, the amount paid by plaintiff to defendant on the purchase price of said lands, together with interest thereon from the date of payment of the same.

3. That if the notes, or any of them, given by plaintiff to defendant, as part of, or to secure, the purchase price of said lands, or if the mortgages or trust deed executed and delivered to defendant by plaintiff as security for the payment of said notes, be not returned into court and cancelled by defendant, forthwith, plaintiff have judgment against de[559]*559fendant, in a further sum for the amount due or to become due on said notes, together with interest thereon, according to the tenor of said notes.

4. That plaintiff have judgment for all costs of this suit, and that if this judgment, together with all costs, and relief hereinabove awarded be not paid and satisfied within the time and manner as required by law and by this decree, plaintiff have execution against defendant for the same.”

To this judgment and decree the defendant prosecutes this writ of error.

Counsel for defendant recognize the rule that if a judgment and decree is supported by competent evidence, where there has been a proper understanding and application of the law, it will not be disturbed upon review, but contend (1) that the trial court erred in that it misplaced the burden of proof, (2) in failing to order a restoration of the property to the company upon rescission of the contracts, and (3) in the admission of improper testimony.

The .

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Lewis v. Winslow
234 P. 1070 (Supreme Court of Colorado, 1925)
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163 P. 292 (Supreme Court of Colorado, 1917)

Cite This Page — Counsel Stack

Bluebook (online)
155 P. 381, 60 Colo. 555, 1916 Colo. LEXIS 179, Counsel Stack Legal Research, https://law.counselstack.com/opinion/hagadorn-investment-co-v-rieke-colo-1916.