Stephenson v. Upper Ashburton Realty Co.

184 A. 230, 170 Md. 288, 1936 Md. LEXIS 98
CourtCourt of Appeals of Maryland
DecidedApril 9, 1936
Docket[No. 33, January Term, 1936.]
StatusPublished
Cited by4 cases

This text of 184 A. 230 (Stephenson v. Upper Ashburton Realty Co.) is published on Counsel Stack Legal Research, covering Court of Appeals of Maryland primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Stephenson v. Upper Ashburton Realty Co., 184 A. 230, 170 Md. 288, 1936 Md. LEXIS 98 (Md. 1936).

Opinion

Sloan, J.,

delivered the opinion of the Court.

This appeal is from a decree sustaining a demurrer to five bills in equity filed by interveners, with leave of the court, in a suit brought by Alice Mae Steed, Hazel L. Nyman, and Ellen V. Gensler, executrix of the estate of Bessie W. Mason, deceased, on behalf of themselves and such others similarly situated, who might join with them, for the cancellation of contracts for the purchase by them severally from the Upper Ashburton Realty Company, Inc., hereinafter called the realty company, of certain lots and parcels of land located on the Magothy River in Anne Arundel County, in two subdivisions called *290 Manhattan Beach and Oak Grove, and to procure a decree for the refund of all monies paid by the plaintiffs on account of those contracts. With the realty company there were named as defendants J. Brooks Mellor, its then vice’ president, by whom the contracts were signed, and Ben S. Hill, Andre L. Broussard, and the Broussard Company, Inc., a Delaware corporation, through whom the sales were made, all of whom were charged with the alleged fraud as the ground for the decree prayed.

It is alleged in the bill of complaint! that the defendants and one Ralph W. Harrison, since deceased, conspired each with the others and with divers other persons to defraud the public by the sale of lots in the two subdivisions by a fraudulent system known as the “lunch and lecture” system, which, without a recital of the details, is nothing more than intensive salesmanship applied by “high pressure” salesmen, who take the prospect on the ground and sell a good story at a high price with a lot, which may or may not have a substantial market value.

The bill then alleged that, in furtherance of the conspiracies charged, the realty company, by J. Brooks Mellor, its vice president, by agreement with Ralph W. Harrison, since deceased, and the defendant Hill, dated December 8th, 1931, gave to them the exclusive right for two years to sell any or all of the lots in both subdivisions at such prices as they might fix, but not less than $300 for inside lots, or $1,000 for waterfront lots, the selling price to be equally divided, as paid, between the first and second parties, the expenses to be paid by the second parties, Harrison and Hill, the second parties “to organize and inaugurate a sale upon said property under the Culver system” or “luncheon and lecture system,” which we infer from the allegations of the bill was to take the prospect, feed him, put him in a good humor, and then, with wild and fantastic statements as to present worth and prospective values and profits, overcome the resistance of the customer or guest, if any remained, and get his signature to an installment contract with as large a cash payment as the one called the “closer” or “financial *291 manager” can induce, the buyer to pay. On the same day, December 8th, 1931, Harrison and Hill assigned to Andre L. Broussard a one-third interest in their contract with the realty company, and he, in turn, assigned to the Broussard Company, Inc., which he organized and controlled.

The charges of fraud made by the plaintiffs in the original bill were statements that many rich and prominent people had bought lots, many who bought had sold at a profit, some had doubled their money, sales were being made by customers every day at a profit, and the original bill alleged as the chief reason they bought was the promise of the salesman that they would resell within certain times in the near future at substantial profits.

The bill of complaint then prayed the cancellation of all of the contracts, the return of the money paid on account, the appointment of a receiver for the realty company, discovery, and general relief.

The realty company and Mellor answered, but did not demur to the bill of complaint; the other defendants having been returned non est. The answer admitted the sales and the execution of the contracts, but denied each and every charge of fraud and misrepresentation alleged, and disclaimed responsibility for any promises of resale made by salesmen, and stressed in their brief a provision in the memorandum of sale and receipt for the cash payment “that no guarantee of resale for the purchaser of the above described property is made by this 'Company, and that no agreement is made between the parties hereto other than that appearing herein.” No authority is cited that any such provision shall operate as a cover for fraud.

Long after the bill and answer were filed, the appellants, Myrtle E. Stephenson, Ellen V. Sullivan, Lucille E. Roberts, Bertha Jacobson, Edith L. Hoag, and Josephine Bay, filed their petitions asking leave of the court to intervene as plaintiffs in this case, and on leave granted as prayed they each filed their several bills of complaint, except Edith L. Hoag and Josephine Bay, who had a joint bill. To each of the intervening bills of complaint the *292 defendant realty company and Mellor demurred, and it is from a decree dismissing the five intervening bills that the interveners appeal. The plaintiffs in the original bill are not parties to this appeal. The allegations of the intervening bills are substantially the same as those of the original bill, except in one very material respect, and that is that no one of the plaintiffs is interested in the contract of any other. Each contract is a separate and distinct entity, made with respect to different properties and at other times.

The chancellor sustained the demurrers on the grounds that there was; a misjoinder of plaintiffs, and that each of the intervening plaintiffs had an adequate remedy at law.

In support of their contention that these plaintiffs, original and intervening, can make common cause against the defendants, the appellants cite and rely on United Grand Lodge v. Murphy, 139 Md. 225, 114 A. 876, 879, and Sears v. Barker, 155 Md. 323, 141 A. 908, but both of these cases show entirely different facts from those we have here. In United Grand Lodge, v. Murphy, four members of a lodge had had charges preferred against them jointly, and together they came into equity in a proceeding against their grand lodge to seek redress for their grievances. The defense of multifariousness was made by the grand lodge, that each member’s grievance was personal to him, and therefore not to be linked with that of the others. The answer as given by this court (139 Md. 225, at page 232, 114 A. 876) was that: “The charges were preferred at the same time by the same parties, and, so far as they had trials, they were joint. They were suspended together—the proceedings being similar to a joint prosecution, resulting in a joint conviction.” In the case of Sears v. Barker, supra, there was but one plaintiff, who sued to have a deed set aside which she claimed had been made in fraud of her claim against one of the defendants, who she charged, had defrauded her in the sale of worthless stock. All of the parties to the circuitous transfer of the property were made defendants in the suit on the charge that they were participants in a trans *293 fer of the principal’s property in fraud of his creditors, and not that they were all concerned in the stock transaction. To the same effect see Beachey v. Heiple,

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Bluebook (online)
184 A. 230, 170 Md. 288, 1936 Md. LEXIS 98, Counsel Stack Legal Research, https://law.counselstack.com/opinion/stephenson-v-upper-ashburton-realty-co-md-1936.