Owen v. Jones

136 P. 332, 68 Or. 311, 1913 Ore. LEXIS 120

• Court: Oregon Supreme Court
• Decided: November 20, 1913
• Status: Published

Opinion

Mr. Justice Bean

delivered the opinion of the conrt.

The evidence shows, and the trial conrt found, in effect, that the material allegations of the complaint were, in substance, sustained by the evidence, and that O. J. Brooks was not the agent of plaintiff as alleged in defendants’ answer, but was the agent of defendant Minerva A. Jones, whom she agreed to pay $100 as commission; that defendant largely through her agent represented to plaintiff and gave figures showing that the income of the apartment house and the expenses were such that the plaintiff could make a payment of $40 per month upon the mortgage given by plaintiff to defendant Minerva A. Jones upon the furniture, with $56 net profit remaining. It appears that plaintiff was unaccustomed to that kind of business, and that she had had former dealings with O. J. Brooks, and was induced to and did believe and rely upon his representations, but that the ordinary expenses of the apartment house were such that after paying the same there was practically nothing left; that the lease was of no value to her; that, if the contract is not rescinded, plaintiff will receive practically nothing for her home and lot.

The cost of heating the apartment house was a material item, and defendant Minerva A. Jones and her agent, O. J. Brooks, both testified that they did not represent that the average cost thereof did not exceed $10 per month. As to the contrary, the plaintiff is strongly corroborated by other witnesses that Brooks made the statement that the house could be heated for $10 per month, and made an argument to substantiate the statement, and in a general way painted the transaction with a roseate hue to Mrs. Owen, who was credulous, did not appear to understand figures, and believed his statements, but soon after entering into possession of the property found to the contrary. It appears that, according to the lease, after the first two years the rent would he $130, instead of $108 per month; that, when Mrs. Owen requested to examine the lease, defendant Minerva A. Jones stated that Mr. Brooks had it, and upon a like request to Mr. Brooks, the manipulator, the latter stated that an attorney had it. It also appears that Mr. Brooks was very careful that Mrs. Owen did not see the lease until after the deed to defendant Minerva A. Jones, and the bill of sale, and assignment of the lease to plaintiff were executed. Mrs. Owen states that she would not have made the trade had she known of this stipulation in the lease.

1. Mrs. Jones seeks to evade the responsibility of the misrepresentations made by Mr. Brooks. He being shown to be her agent in the transaction, she cannot escape the consequences of his acts, whether she authorized the same or not. By availing herself of the benefits of the transaction, she is bound by the representations made and the methods employed by her agent to effect the contract. She is precluded from ratifying a part thereof, and repudiating the same in part: Copeland v. Tweedle, 61 Or. 303 (122 Pac. 302); Wilson v. McCarthy, 66 Or. 498 (134 Pac. 1189); Elwell v. Chamberlain, 31 N. Y. 611, 619; Haskell v. Starbird, 152 Mass. 117 (25 N. E. 14, 23 Am. St. Rep. 809).

2. It is contended by counsel for defendants that the plaintiff’s complaint is insufficient, in that it does not show that prior to the commencement of this suit plaintiff offered to return the property received by her. In a suit in equity to rescind a contract voidable for fraud, it is not necessary for plaintiff to return or offer to return before suit the consideration received; but it is enough if the plaintiff alleges a willingness and ability to place the defendant in statu quo, and the court can protect the rights of defendant by decreeing a restoration in consideration of the rescission. This the trial court did in the case at bar: Crossen v. Murphy, 31 Or. 114 (49 Pac. 858); Hoyt v. Jaques, 129 Mass. 286. In the former case, at page 122 of 31 Or. (at page 860 of 49 Pac.), of the opinion, Mr. Chief Justice Moore said: “The maxim that ‘he who seeks equity must do equity’ is evidently not violated by the failure of the plaintiff, in a suit to rescind a contract for fraud, to allege a restoration of, or an offer to return, the consideration, or a willingness even to do so, for by his application to the court for equitable redress he concedes that before it will be awarded he must do equity, which will compel him to account for everything of value he may have received, thereby tacitly inviting the court to protect the rights of the defendant by decreeing a restoration in consideration of the rescission.”

The plaintiff has in no way ratified the contract involved. She acted promptly in bringing this suit to accomplish a rescission.

The decree of the lower court was right, and it is affirmed. Affirmed.