Vrbsky v. Arendt

229 N.W. 337, 119 Neb. 443, 1930 Neb. LEXIS 56
CourtNebraska Supreme Court
DecidedFebruary 28, 1930
DocketNo. 26841
StatusPublished
Cited by5 cases

This text of 229 N.W. 337 (Vrbsky v. Arendt) is published on Counsel Stack Legal Research, covering Nebraska Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Vrbsky v. Arendt, 229 N.W. 337, 119 Neb. 443, 1930 Neb. LEXIS 56 (Neb. 1930).

Opinions

Day, J.

The plaintiff brought an action at law to recover $14,000 damages alleged to have been sustained by virtue of a conspiracy to defraud by misrepresentation on the part of the defendants in a real estate trade. At the close of the plaintiff’s evidence, the trial court directed a verdict for defendants on the theory that the action was barred by the statute of limitations.

The evidence in this case is wholly that on behalf of the plaintiff, and in reviewing the action of the trial court we must regard as conclusively established every point favorable to the unsuccessful party which the evidence tends to establish. Curtice Co. v. Estate of Jones, 111 Neb. 166; Bank of Cortland v. Maxey, 102 Neb. 20.

With this rule of law definitely in mind, the following statement of facts is delineated: The defendant Arendt was the owner of property in Lincoln, Nebraska, known as the Clayton Apartments, which he traded, with the assistance of defendants Nickles, Douthett, and Pardee, to the plaintiff, a Bohemian farmer, for 80 acres of land in Saline county and a mortgage on other land for $22,000. The mortgage was paid in full and the trade valuation of the land, $14,000, was realized, so that in truth the defendant Arendt received $36,000 for his apartment. The deal was consummated after negotiations between the parties for a period of several weeks, during which time numerous interviews were had between the plaintiff and the defendants, individually and collectively. Nickles, Douthett, and Pardee were real [445]*445estate men, to whom the plaintiff paid a commission upon, and as a part of, the consummation of the deal. The defendant Arendt, the owner of the apartment, had a joint office with the other defendants.

The defendants represented to the plaintiff that the apartment cost $42,000 to build and that it was worth more than $36,000. To add color to this representation and to inspire confidence in the plaintiff, he was told that Douthett was the superintendent in construction and knew the cost thereof. Douthett told him many times that the actual cost of the construction of the apartment, plus the cost of and the “value of the ground, $18,000, was more than $'42,000, and that the value of the apartment was more than $36,000. The apartment, according to the testimony of defendant Douthett, did not cost over $18,000, and the ground was worth only $3,500. It is clearly evident that, as a result of this trade, plaintiff sustained a loss of approximately $14,000. The plaintiff was not interested in the apartment because, as stated in his own words, “I am no good with city property.” He was ignorant as to values of city property and knew not how to handle it. But the defendants sustained their contact with him by evincing their interest in assisting him to dispose of certain properties he owned. But they continuously and repeatedly centered his attention upon this particular deal. It was the controlling motif of their activities. The plaintiff, ignorant and inexperienced as to city property, believed and relied upon the representations made to him and closed the deal February 19, 1922. He did not discover the falsity of the representations until about December 8, 1926. This action was started June 22, 1928.

The principal assignment of error is that the trial court erred in finding, as a matter of law, that the plaintiff’s cause of action-was barred by the statute of limitations, and in directing a verdict for the defendants. Section 8512, Comp. St. 1922, provides that an action for relief on the ground of fraud shall be brought within four years, but the cause of action in such a case shall not be deemed to have [446]*446accrued until the discovery of the fraud. This statute has been construed by this court, the leading case being Parker v. Kuhn, 21 Neb. 413. There the rule is announced as follows : “An action for relief on the ground of fraud may be commenced at any time within four years after a discovery of the facts constituting the fraud, or of facts sufficient to put a person of ordinary intelligence and prudence on an inquiry, which, if pursued, would lead to such discovery.” It cannot be doubted that this is the well-settled rule, since it has been adhered to by this court in an unbroken line of decisions,, including among others: Coad v. Dorsey, 96 Neb. 612; Bank of Miller v. Moore, 81 Neb. 566; Raymond v. Schriever, 63 Neb. 719; Horbach v. Marsh, 37 Neb. 22; Wright v. Davis, 28 Neb. 479.

This transaction occurred February 19, 1922, while this suit was started June 22, 1928. The plaintiff alleges in his petition, and testifies in support thereof, that he first discovered the fraud December 8, 1926, méaning, under our construction of the words of the statute, that he then first discovered the fraud or facts constituting such fraud sufficient to put a person of ordinary intelligence and prudence upon an inquiry, which, if pursued, would have led him to such discovery. The defendants contend that the plaintiff in this case prior to four years from the date of bringing the action discovered such facts. The trial court followed their view: The defendants attribute knowledge to the plaintiff, first, because he went into possession February 23, 1923. The evidence upon this point is that he went into' possession, but did not personally manage the apartment, nor collect the rent, but did visit the property a number of times. The plaintiff testifies that he did not discover through his possession of the property any facts constituting, fraud. Even his living in the apartment would not necessarily put him in possession of such knowledge. In Carson v. Greeley, 107 Neb. 609, where the plaintiff lived on the land for an entire year, this court held that an action brought five years afterward was not barred. The plaintiff here, a Bohemian, was born in Heskov, Hungary, coming [447]*447to this country when eight years of age, with little education, and lived upon a farm almost up to the time of this transaction. Paraphrasing the language of Dean, J., in Carson v. Greeley, supra, the plaintiff knew nothing about city property; he placed great reliance in defendants, and did not have an understanding of business affairs that would1 enable him to cope with the defendants. Just as in the last cited case, he was lulled into a feeling of security by the defendants, who continued to represent to him that he had .secured a property for less than at cost, and less than it was worth. Some of them secured another trade, which they represented to him as making him a $1,000 profit. This, no doubt, sustained his feeling of security and prevented a suspicion from arising. He was under no duty to have the property appraised until he had knowledge which would put him on inquiry. Gerner v. Mosher, 58 Neb. 135; Raymond v. Schriever, 63 Neb. 719. In the latter case, Mr. Justice Holcomb said: “The test is not whether the defrauded party has the opportunity or power to discover the fraud, but whether he was in possession of such facts as were sufficient to demand an investigation, which, if pursued, would have disclosed the fraud.”

Next it is argued that one Humpe, a real estate man, was his agent for managing the apartment and collecting the rents. Plaintiff asked him to find a buyer, but price was not discussed. This man knew the value of said apartment, but testified that he never told plaintiff, because, as he said, it was none of his affairs. This corroborates the plaintiff’s testimony. It is evident that knowledge of facts constituting fraud cannot be imputed to the plaintiff from this circumstance.

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Bluebook (online)
229 N.W. 337, 119 Neb. 443, 1930 Neb. LEXIS 56, Counsel Stack Legal Research, https://law.counselstack.com/opinion/vrbsky-v-arendt-neb-1930.