McNair v. Benson

126 P. 20, 63 Or. 66, 1912 Ore. LEXIS 194
Oregon Supreme Court·Decided August 13, 1912·Published·Cited by 12 cases

Opinion

Mr.' Justice Moore

delivered the opinion of the court.

1. The evidence shows that on April 11, 1910, W. W. Fawk executed to C. C. Murtón a writing, in which he stipulated to convey to the latter what was then supposed to be 320 acres of land for $18,500, of which sum $100 was then received. $3,900 was to be paid when an abstract of the title to the premises was furnished and a deed to the land executed. $4,500 was to be paid January 1, 1911, and the remainder, $10,000, on or before five years, with interest on the two latter sums at 6 per cent per annum. A survey of the land having been made, for the purpose of dividing in into orchard tracts, the premises were found to contain 322 acres. The plaintiff, trying to form a syndicate to pay for the land and to sell and convey the platted tracts, falsely represented to the defendants C. G. Benson and Dosch that, in order to secure a transfer of Murtón’s interest in the real property, it would be necessary to pay him therefor on the basis of $75 an acre, or $5,650 more than the original purchase price, when Murtón had no interest in the premises, except to act as a mere trustee, who was to have received $250 for his services. The plaintiff, further falsely representing that he and C. C. Page would pay Murtón the sum which, it was asserted, was necessary to secure a transfer of his interest in the premises, and that they had already given him on account thereof $4,000, and that each would take an undivided one-fourth interest in the land, induced C. G. Benson and Dosch each to take a like interest, and to pay therefor $2,000 each, from which sum $3,500 was given to Fawk, who, with his wife, executed to the Title & Trust Company, a corporation, a deed to the land. Murtón also, for the expressed consideration of $5,650, claimed to have been paid by J. S. McNair, E. P. Dosch, C. G. Benson, and C. C. Page, executed to the Trust Company a deed of all his interest in the real property . No money whatever was paid to Murtón for this conveyance. The Trust Company issued to McNair, [70]*70Dosch, C. G. Benson, and Page trust certificates, showing that each was a beneficial owner of an undivided one-fourth interest in the premises, in the general management and sale of which the corporation was to act as the financial agent.

Of the $4,000 so paid by C. G. Benson and Dosch, $500 thereof was, by Fawk’s direction, paid to E. P. Mossmon and S. L. Young on account of commission for negotiating a sale of the land to Murtón. When such sale was effected, Mossmon was plaintiff’s partner in the real estate business, which firm thereafter continued and existed at the time of the trial herein.

In November, 1910, C. G. Benson and Dosch, having learned that the $4,000 which they gave was the only money actually paid on account of the purchase of the land, and that the plaintiff and Page, without paying any consideration therefor, had each obtained an undivided one-fourth interest in the premises equally with them, complained of such conduct to McNair, who, on December 5th of that year, admitted making the false representations hereinbefore mentioned, and agreed for himself and Page to pay the installment of $4,500 maturing January 1, 1911, and the further sum of $435 as interest thereon.

Pursuant to this understanding, the plaintiff paid to the Trust Company $2,500 for Fawk, and also left with it for him promissory notes for $1,435 and $1,000 respectively ; the latter note having been signed by Mossmon as a joint maker. Fawk accepted the money and notes in full settlement of the installment of the purchase price maturing January 1, 1911, and thereupon returned to Mossmon the note for $1,000, marked “Paid,” in satisfaction of the remainder of the commission due on account of negotiating a sale of the land to Murtón. As a part of this settlement, the plaintiff assigned to the defendant B. M. Benson, an attorney at law, 10 per cent of the profits expected to be realized from a sale of parts of his interest in the orchard tracts, in consideration for [71]*71which that member of the bar stipulated to transact for McNair all his law business pertaining to the management and sale of such parcels of land. Of the money paid to the Trust Company, pursuant to the agreement mentioned, $1,500 was obtained from L. and S. Friemen, to whom McNair, in consideration thereof, transferred three-fourths of his interest in the premises.

Having learned that Fawk had received for his land in money, notes, mortgage, etc., only $17,000, instead of $18,500 as stated in the contract with Murton, and that he had paid $1,500 as commissions for negotiating the sale to Young and Mossmon, the latter being McNair's partner, B. M. Benson, on January 18, 1911, invited the plaintiff into his office, which he entered about 10 o’clock a. m. and found the other defendants assembled there. The door of the room was thereupon fastened by a spring lock, which did not permit an entry without turning the catch, but would not prevent an exit if the bolt were removed from the inside. McNair was directed to be seated, and informed that more of his fraud had been discovered, respecting the receipt of $1,500 from Fawk as commissions. He was told that, in order to liquidate the damages which the defendants had sustained by reason of his misrepresentations, it was necessary that he should immediately pay them $4,500 and transfer to them his remaining interest in the land, and that, unless he complied with their requests, an action would forthwith be commenced against him for his fraud, to recover the damages for which a complaint had already been prepared. He was further informed that if such action were instituted it would disgrace him and his family and ruin his business. The plaintiff asked permission to consult with a lawyer and also to visit his wife before acceding to their demands; but his requests were denied, and he was commanded then and there to settle their claim for damages. He was permitted to leave the office twice; but on each occasion was accompanied by one of the [72]*72defendants, and on his return he was compelled to sit so that two of them were between him and the door, and he was notified that he could not leave the room until he made the settlement required. At nearly 3 o’clock in the afternoon, in attempting to issue an order on a bank for $2,000, he was so nervous that the paper was destroyed; whereupon he drew another check for the amount, payable to B. M. Benson, who indorsed it to C. G. Benson, and the latter hurried to the bank and secured the money before that institution closed its doors for the evening. A few minutes after 3 o’clock of that day McNair issued to Dosch two negotiable promissory notes for $500 each, and to C. G. Benson three similar notes, each for the same sum, and also transferred to them his remaining interest in the real property.

During their settlements, the plaintiff offered to repay Dosch and C. G. Benson the sum which they had given on account of the purchase of the land and interest thereon; but they declined the proposal. After McNair had transferred three-fourths of his interest in the premises to L. and S. Friemen, B. M. Benson wrote them respecting the land, saying inter alia:

“This is a splendid investment nevertheless and an opportunity such as seldom presents itself.”

The trial court, referring to January 18, 1911, made a finding of fact as follows:

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McNair v. Benson, 126 P. 20, 63 Or. 66, 1912 Ore. LEXIS 194 (Or. 1912).

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