author: Bird, C. J.

text:
    BURTCH v. CHILD, HULSWIT & CO.
    1. Warranty — Breach — Representations — Opinions — Statements op Fact — Intention—Question por Jury.
    In an action by tbe purchaser of bonds against tbe seller, a brokerage corporation, for breach of warranty, where plaintiff notified defendant that he was ignorant of the value of the bonds and that he relied upon its representations, and demanded a statement in writing from defendant direct that the bonds were good, in response to which defendant’s secretary wrote that “We Know that the bonds are absolutely good,” held, to be open to thei inference that more than a mere expression of opinion was intended and the question as to whether an expression of opinion or statement of fact was intended was properly submitted to the jury.
    2. Same — Agent’s Authority — Evidence—Sufficiency.
    Testimony as to the secretary’s authority to make the warranty, held, sufficient to submit to the jury.
    3. Same — Agent’s Authority — Notice—Ratification.
    Where plaintiff refused to buy without a statement in writing from defendant that the bonds were good, and the next day he received such statement signed by defendant by its secretary, and thereupon defendant received plaintiff's money and retained it after being advised of the circumstances under which it was received, defendant, as a matter of law, ratified the act of its secretary, if he acted without authority.
    4. Same — Breach of Warranty — Measure of Damages — Instructions.
    Where there was some testimony that the bonds were worthless at the time they were sold in 1909, an instruction by the court that if the jury found that they were worthless, the measure of damages would be the amount plaintiff paid for them, with interest to the date of the trial, was not erroneous, where they were also instructed that if they found there was some intrinsic value in the bonds in 1909 they should ascertain that value, and the difference between that sum and what plaintiff paid for them, plus the interest, would be the proper measure of damages.
    5. Same — Conflicting Testimony — Question for Jury.
    Where certain letters- written by plaintiff, introduced in evidence, were in conflict with his testimony on the trial that he relied on the representations of defendant, it was the province of the jury to determine which, if either, of these statements was true.
    6. Trial — Evidence—After Events — Harmless Error.
    The admission of evidence of after events, although irrelevant, held, not prejudicial.
    Error to Kent; Perkins, J.
    Submitted June 12, 1918.
    (Docket No. 6.)
    Decided October 6, 1919.
    Assumpsit by Manley W. Burtch against Child, Hulswit & Company for breach of warranty on the sale of corporate stock. Judgment for plaintiff. Defendant brings error.
    Affirmed.

      Butterfield & Keeney (Charles B. Blair, of counsel), for appellant.

      Charles E. Ward, for appellee.
   Bird, C. J.

In 1909 plaintiff was engaged in the manufacturing business at Sparta. The defendant was a corporation engaged in the business of bond brokers at Grand Rapids. It is the claim of plaintiff that in August, September, and October, 1909, he purchased from defendant $13,500 in bonds of the Denver-Greeley Valley Irrigation District of Colorado on a warranty that they were a secure investment and absolutely good. They proved to be otherwise, and this suit in assumpsit was begun to recover the purchase-price. The question whether defendant warranted the bonds was submitted to the jury, and they found that defendant did warrant them, and awarded plaintiff > a judgment of $17,550, which covered the purchase price and interest. Application for a new trial and for judgment non obstante veredicto followed, but both applications were denied.

1. Defendant strenuously contends that there was no testimony on the question of warranty which justified the trial court in sending it to the jury. This point makes it necessary to review to some extent the testimony on that question. It appears from the testimony of plaintiff that he was solicited by defendant to purchase the bonds by descriptive literature outlining the irrigation projects, and by its personal representative, Mr. Stanton, who called upon him several times. Mr. Stanton praised the bonds, said tljiey were good, said the company had been out there to investigate and that they were in a position to know their value. That plaintiff finally advised Stanton that he would not purchase them unless he got a letter from the company direct, stating that the bonds were good. Mr. Stanton went away and soon thereafter plaintiff received from defendant the following letter:

“Mr. Manley W. Burtch,
“Sparta, Michigan:
“The writer, on returning to the city this morning, finds that our Mr. Stanton called on you last week’and that you were interested in the Denver-Greeley Valley Municipal Irrigation District bonds, which we have been offering.
“If you are in funds at this writing we will be very glad to have you take some of this issue. * * *
“The writer has personally been over this district, Mr. Burtch, and it has also been visited by other members of our firm. * * * We know that the bonds are absolutely good and we recommend them as a very secure investment, paying an attractive rate of interest.
“Child, Hulswit & Co.,
“Ralph S. Child, Secretary.”

After receiving this letter plaintiff saw Mr. Child, who informed him—

“that the bonds were absolutely good, and the security back of them was adequate, that is, it was sufficient, that it was in the nature of a municipal bond, the same as a school bond, and that it was the highest kind of security that could not be destroyed. He said the lands were settled. He said that he, as well as other members of the firm, had been over the proposition, made investigations that it would not be possible for me to make, and that the bonds were good and that I need have no fear of losing my money. He said they were perfectly competent to investigate those things and that I was not competent to do so. Why, he said that they had made an investigation, and I told him I was relying absolutely on their word in making the investigation, because I did not claim to know enough to make an investigation myself; and, as a matter of fact, I told him I had no time to investigate it, and when I handed the money over to him I says, T am relying on you people absolutely in this matter.’ ”

Plaintiff further testified that he relied upon these representations, and would not have purchased the bonds except for them. This is, in substance, the basis of plaintiffs claim of warranty.

Defendant argues that the statements, oral and written, show, upon their face, that they are mere expressions of opinion and are not such as constitute in law a warranty, citing in support of this contention the following cases: Bristol v. Braidwood, 28 Mich. 191; French v. Fitch, 67 Mich. 492; Krause v. Cook, 144 Mich. 365; Deming v. Darling, 148 Mass. 504 (20 N. E. 107); Crosby v. Emmerson, 142 Fed. 713; Worth v. McConnell, 42 Mich. 473; Chafey v. Mathews, 104 Mich. 103 (27 L. R. A. 558); Getchell v. Dusenbury, 145 Mich. 197; Duffany v. Ferguson, 66 N. Y. 482.

And it is further contended that there is no evidence which shows that the statements were intended to be warranties. None of the cases cited is directly in point. They, like most of the cases, deal with the general’ rules and their application to the particular facts therein involved. It is not always easy to determine where expressions of opinion leave off and representations of fact begin. Sometimes the same statement made on different occasions but under different circumstances will be differently construed. As was said in Andrews v. Jackson, 168 Mass. 266 (47 N. E. 412, 37 L. R. A. 402):

“It is often impossible, * * * to determine as matter of law whether the statement is a representation of a fact which the defendant intended should be understood as true of his own knowledge or an expression of opinion. That will depend upon the nature of the representation, the meaning of the language used as applied to the subject-matter, and as interpreted by the surrounding circumstances in each case. The question is generally to be submitted to the jury.”

Counsel suggest that the cases of Bristol v. Braidwood and French v. Fitch, supra, are similar on the facts and are controlling. We cannot agree with them in this view. The facts, and the points decided are more or less at variance with the present one. In so far as particular cases can aid we think the cases of Taylor v. Soper, 53 Mich. 96, and Knauss v. Major, 111 Mich. 239, are more nearly in accord with the facts of the present case.

However, it may be said generally that:

“One who purchases a bond honestly relying on the seller’s representations that it is valid when it is in fact invalid or worthless, may recover the price paid for it, in an action for a breach of warranty, although the seller may have acted in good faith and the buyer may have had ample opportunity to examine the bond. All material representations made by the seller with respect to the nature and character of the security for the bonds or as to the existence of security, when relied on by the purchaser, constitute- warranties.” 30 Am. & Eng. Enc. Law (2d Ed.), p. 158.

We might be able to agree with counsel in their contentions were it not for the letter of August 4th and the circumstances under which it was written. Plaintiff had been solicited by letter and literature to purchase the bonds. This was followed by several visits from Stanton who tried to induce plaintiff to purchase them. He had explained the irrigation projects upon which the bonds were issued, had praised their value and endeavored to convince plaintiff that he knew whereof he spoke, as members of his firm had been out to Denver and personally inspected the proposition. All this did not appear to satisfy plaintiff, he wanted something more, he wanted a letter from defendant itself that the bonds were as represented. In order to consummate the sale defendant yielded to his demand and wrote the letter, in which the significant words “know” and “absolutely good” were underscored. Considering these circumstances, together with the fact that the irrigation projects at that time were new to the public, that plaintiff knew nothing about them and so advised defendant, and further advised defendant, when he purchased them, that by reason of his lack of knowledge he relied upon the representations so made to him, it cannot be said, as a matter of law, that the representations were mere expressions of opinion. We are persuaded that they are open to the inference that something more than mere expressions of opinion was intended. The question whether they were intended as expressions of opinion, or statements of fact was properly submitted to the jury. 35 Cyc. p. 481.

2. But counsel say there was no competent proof that Child, who wrote the letter of August 4th, had authority to warrant the value of the bonds. The trial court held, as a matter of law, that defendant had the power to warrant the value of bonds which it disposed of, but left it to the jury to say whether Child was authorized by defendant to do so. It appeared from the testimony that he was a director, secretary and vice-president of the company, in charge of the buying and selling of bonds. Testimony was received showing similar dealings with other persons. We think there was sufficient testimony to submit to the jury on the question of his authority to make the warranty, but if this question be a doubtful one, we think it can be said, as a matter of law, that the company ratified the act of Child. Plaintiff said to Stanton, “I will not buy unless the company writes me a letter saying the bonds are good.” The next day he received such a letter signed by the defendant. This shows conclusively that the ultimatum of plaintiff was delivered to defendant and upon this letter defendant got plaintiff’s money, and retained it after being advised of the circumstances under which it was received,

3. On the question of damages the court instructed the jury, in substance, that if they found the bonds were worthless in 1909, the measure of damages would be the amount plaintiff paid for the bonds, with interest to the date of the trial. They were further instructed that if they found there was some intrinsic value in the bonds in 1909 they should ascertain what the real value was, and the difference between that sum and what plaintiff paid for them, plus the interest, would be the proper measure of damages. Defendant claims that this was error because there was no evidence that the bonds were worthless in 1909. There was considerable testimony bearing on the value of the bonds in 1909, and there was some to the effect that they were worthless at that time. In view of this there was no error in submitting the case upon that theory. The instruction on the measure of damages finds support in Maxted v. Fowler, 94 Mich. 106.

4. Counsel argue that plaintiff, in purchasing the bonds, did not rely on the representations of defendant. This contention is supported by certain letters of plaintiff addressed to Trowbridge & Niver, in which he stated he relied on them in purchasing the bonds. This was in conflict with his testimony on the trial that he relied on the representations, of defendant. After the admission of the letters plaintiff explained why he wrote them. It was the province of the jury to determine which, if either, of these statements was true. Kelly v. Freedman, 56 Mich. 321; Watson v. Watson, 58 Mich. 507; People v. Hansen, 183 Mich. 565; Parnell v. Pungs, 190 Mich. 638.

5. Serious complaint is made because the trial court admitted evidence of after events, namely: What steps were taken by the bondholders to protect their interests. Reports' issued by the receiver and the bondholders’ committees were received. Some of this testimony was important as throwing light on the value of the bonds in 1909, but much of it had no relevancy to the issue. While we think there was much testimony admitted on matters, foreign to the issue, we are not persuaded that such irrelevant testimony was prejudicial to defendant. We have examined and considered the remaining questions, but find no merit in them.

The judgment of the trial court is affirmed.

Moore, Steere, Brooke, Fellows, Stone, and Kuhn, JJ., concurred.

The late Justice Ostrander took no part in this decision.


source: Caselaw Access Project

author: Moore, J.

license: Public Domain

text:
    CITY OF FLINT v. GRAND TRUNK WESTERN RAILWAY CO.
    1. Railroads — Streets—Unauthorized Crossing — Estoppel.
    Where defendant railroad company, in 1910, constructed three stub tracks, constituting a siding, crossing certain streets in the city of Flint, without the latter’s consent, but no objection was made thereto and said tracks were used until 1916, said city is estopped from requiring 'said, tracks to be torn up and the streets returned to their original condition.
    2. Same — Statutes—Right to Cross Streets.
    In view of 2 Comp. Laws 1915, § 8232 et seq., permitting the tracks of steam railroads built on private right of way to cross public highways and streets, and a resolution of the common council of the city of Flint authorizing the construction of certain stub tracks across certain streets in said city, by defendant steam railroad company, to facilitate the movement of freight, which resolution was later rescinded and the construction sought to be enjoined, although defendant had incurred considerable expense in reliance thereon, held, that the completion of the tracks should be permitted.

      On power of municipality to compel removal of spur track, turnout or switch from street or highway, see note in L. R. A. 1918B, 481.

      3. Same.

      Held, that defendant should be permitted to connect the east end of said sidings with its main track, subject to the conditions imposed by the resolution of the common council authorizing said construction.
    4. Same — Regulation by Municipal Corporation — Ordinances— Public Utilities Commission.
    If the State laws as to the movement of trains over streets and highways is insufficient to safeguard those using the streets of a city, they may be supplemented by reasonable ordinances and by the maintenance of gates and the keeping of watchmen as may be required by the public utilities commission.
    Appeal from Genesee; Brennan, J.
    Submitted October 15, 1918.
    (Docket No. 51.)
    Decided October 6, 1919.
    Bill by the city of Flint against the Grand. Trunk Western Railway Company to enjoin the laying of certain tracks. Defendant filed a cross-bill, claiming affirmative relief. From the decree rendered, defendant appeals.
    Reversed, and decree entered.

      John H. Farley {Guy W. Selby, of counsel), for plaintiff.

      Harrison Geer {Geer, Williams & Martin, of counsel), for defendant.
   Moore, J.

The trial judge stated so clearly the issues involved in this proceeding in a written opinion filed by him, that we quote from it freely as follows:

“From the concessions made in open court by counsel for the respective parties, and the testimony of witnesses produced upon the hearing, I find the material facts to be substantially as stated in plaintiff’s amended bill of complaint, except that I am unable to find that there has been such use made by the public of the streets known as Cherry and Willow streets for a distance of 165 feet crossed by the lines and tracks of the defendant railway north of Burton street as will justify the city in claiming the existence of these streets across defendant’s property as public highways.
“Prior to May, 1910, the defendant and its predecessors had a steam railway extending through the city of Flint for the transportation of freight and passengers, using one main line track which extended across Forest street and Burton street and easterly across Walnut, Decker and Maple streets, which is represented on the blueprint attached to defendant’s pleadings by the lower white line, and it was at that time also using a track represented by the white line just north of said main track, coming from the west and extending to a point at or near the west line of Walnut street.
“Said defendant, in May, 1910, commenced the construction of what is now known as Flint east yards by constructing the three stub tracks, so-calléd, indicated by the upper white lines on the said blueprint, crossing Willow, Cherry, Walnut, Decker and Maple streets, and said tracks were laid across Walnut and Decker streets without first obtaining the consent of the common council of the city of Flint, and said stub tracks have since their construction been used by the defendant for the storage and switching of cars across those streets as well as Burton, Forest, Crapo streets and Richfield road.
“That in 1915, the track lying just north of the main track was extended across Walnut, Decker and Maple streets, and the track shown by the white line on the blueprint lying just north thereof was also constructed extending across these streets, which was also done without permission of the common council of the city of Flint, and these have since been used for the switching and storage of cars across these and the other streets named.
“That in May, 1916, the defendant commenced the construction of the tracks indicated on the blueprint by red lines, and some objection having been made, an application was made to the common council, July 81, 1916, for the permission to construct these additional tracks; that such permission was granted upon certain conditions, which conditions were not complied with, and at the next session of the common council of the city of Flint, that body acting under the authority conferred by its charter, reconsidered and rescinded its action granting such permission, and the city of Flint applied to this court for an injunction restraining the defendant from continuing the work of laying such additional tracks and applied for and obtained a temporary injunction, and by leave of the court, plaintiff filed an amended bill of complaint, which the defendant answered, and this case has been heard upon the pleadings so amended.
“At the request of counsel, I have made a personal inspection of the yards and crossings in the vicinity thereof, and I find from the evidence in the case and from such inspection that the Richfield road, Crapo and Forest streets are much traveled streets; that an electric street railway crosses defendant’s railway tracks at grade on Crapo street, and that the switching of freight cars by the defendant railway across these streets in connection with its use of the tracks now laid in its east yard greatly impedes traffic on these streets and has created a dangerous and menacing condition, and that this is also true to a lesser extent at Burton, Walnut and Decker street crossings; that the occupation by the railway company of Walnut and Decker streets by such yard tracks without the consent of the city council creates and constitutes a public nuisance.
“While in the opinion of some of the witnesses produced by the defendant, the construction of the proposed additional tracks would tend to diminish dangers resulting from the switching of cars in and out of this yard across Richfield road, Crapo and Forest streets, yet from the inspection of the defendant’s yard and the manner in which the cars, must necessarily be stored and switched on the tracks as proposed, the court i<? not convinced that the danger will be materially lessened, but on the contrary the menace will be greatly increased across Walnut, Decker and Maple streets should such additional tracks be constructed as proposed, and the construction of such tracks in such streets would also be a public nuisance and menace to persons having occasion to use said crossings.
“The questions presented by the pleadings and proofs are whether the right to construct these additional tracks with the tracks already constructed, occupying about 165 feet of the streets for yard purposes, is conferred by subdivision 5 of section 6587, Howell’s Michigan Statutes (2d Ed.) [2 Comp. Laws 1915, § 8243] , without the consent of the common council of the city of Flint, as well as the right of the defendant to maintain the tracks constituting part of said switching yards constructed in 1910 and 1915, and to continue the operation of such yards without the consent of the common council. The case of Highway Commissioner of Ecorse Township v. Railroad Co., 148 Mich. 436, is controlling in my opinion of the law in this State so far as these questions are concerned. * *
“In conclusion I find that in view of the existing conditions which have made necessary better shipping facilities, and 'the fact that some considerable time may be required for the defendant railway to establish and equip switching yards at suitable points in or near the city, it is obvious that the defendant should be permitted to continue the use of its east yard with the tracks now laid and be permitted to construct the additional tracks proposed, as shown on the blueprint, and maintain the same for a longer period than would ordinarily be considered reasonable, and for these reasons only, the defendant should be permitted to construct the proposed tracks as shown on the blueprint by the red lines, and to use the same and continue the use of the last mentioned tracks after their construction, together with those already in use in its east yard as now located for a period not exceeding four years.
“Therefore, a decree may be entered that the defendant railway be perpetually restrained and enjoined from the further use of its switching and storage tracks constituting said east yard, as distinguished from its main and sidetracks necessary for the transportation of freight and passengers from and after four years from the date of the decree, and from the construction of any additional tracks across Burton, Maple, Decker and Walnut streets, and that the defendant be required to remove from said streets all such tracks and ties now laid in said streets other than its main and sidetracks for the transportation purposes only, and that it restore said streets to their original condition, as near as may be, within four years of the date of such decree. The court recommends that in view of all the circumstances and present conditions, and the government control of 'the defendant, that the common council grant permission to the defendant railway to use all said streets with its proposed additional tracks under reasonable, proper safeguards; that the defendant file with the city a properly executed agreement to remove all such sidetracks, including the proposed tracks, if constructed within a period of four years from the date of this decree.”

From this decree the defendant has brought the case here by appeal.

The plaintiff did not appeal and the conclusion of the trial judge as to Cherry and Willow streets must be regarded as final.

The first question calling for serious consideration is the status of the tracks constructed in 1910. The construction of these tracks was known to everybody in that vicinity. They were built upon defendant’s private right of way at a very considerable expense. Upon their completion the defendant immediately began to use them and continued to do so without objection or complaint so far as the record shows, upon the part of the city, until the amended bill of complaint was filed in December, 1916. To now require the defendant to tear up these tracks and to restore the streets to the condition they were in before the tracks were built would be exceedingly inequitable, and the city should be regarded as estopped from asking this to be done.

The next question is as to the decree which should be entered in relation to what was proposed to be done in 1916. These tracks, if laid would all be on defendant’s right of way except where they crossed the streets and would be between the tracks laid in 1910 and Burton street.

In defendant’s answer to the amended bill is the following:

“For answer unto paragraph VI of said amended bill, and in partial explanation of the allegations therein made, this defendant says that on July 31, 1916, the common council of said city of Flint passed the following resolution, viz.:
"‘Moved, that the application of tlie Grand Trank Railway-Company for permission to construct certain sidetracks in the vicinity of Walnut street as shown on the map filed with such application, he granted on condition that the same be without prejudice to the right of the city to a crossing on Willow street when desired, and on further condition that gates he placed on all' crossings affected by such increased railroad traffic and that such crossings be planked the full width of street; also that at the same time said railroad company, at its own expense put in a crossing in continuation of Minnesota avenue, with proper cattle guards, sidewalks and planked roadway at least sixteen feet wide, which motion was adopted.
“‘Dated, July 31st, 1916.’
“That in contemplation of the passage of said resolution this defendant had caused the work of installing said tracks to be started before the passage thereof, but had not made very much progress in that respect, and that after the passage thereof, it proceeded vigorously to prosecute the work of grading, etc., preparatory to installing said tracks, and had expended a large sum of money in such work, to-wit: five thousand dollars and upwards, when said common council, without any notice to it, said defendant, on August 7, 1916, rescinded said resolution, and now claims that the defendant has no right to proceed to construct said tracks across said streets as planned, and as permitted by said resolution. It further says, in explanation of the alleged dangerous condition in which said streets were left, that it was restrained by the injunction of this honorable court, issued in this suit, from further proceeding with such work, and that its failure, if any failure there was, to restore said streets to their original condition as near as may be, was because of said injunction, and not because of any intentional omission to thus restore them, and that whatever trouble the plaintiff has been put to in obtaining protection at any of said street crossings, is directly due to the stoppage of said work by said injunction.”

There was an abundance of testimony supporting the averments of the answer as to the work done and the cost thereof. These proposed tracks- are near the main line. There is testimony that if constructed they would not only relieve the situation as to local freight but would facilitate the movement of through freight. An inspection of the blueprint supports this testimony.

The instant case is more within the principles, of law stated in City of Mason v. Railway Co., 157 Mich. 1, than it is within Highway Commissioner of Ecorse Township v. Railroad Co., 148 Mich. 436, as the last-named case dealt with a terminal yard. The applicable statute is quoted in the opinion in the first-named case and need not be repeated here. In view of the use to be made of the tracks which were in process of construction when this suit was brought, and the resolution of the common council of July, 1916, and the expenditure incurred by defendant in reliance thereon, we think defendant should be permitted to complete the tracks begun in 1916.

Another question demands attention, and that is, Should defendant be permitted to connect the east ends of these sidings with its main track? An examination. of the blueprint and the undisputed evidence shows that this would have a tendency to relieve the situation instead of further congesting the traffic. The defendant should be allowed to complete its work as •proposed by the blueprint, but subject to all of the conditions imposed by the resolution before quoted which was adopted by the common council.

It goes without saying that public streets are essential in every city. It is equally true that modem civilization could not get along without railroads. Every intelligent person knows that the highways cannot be used as freely where they cross railroad tracks as where there are none. On the other hand the railroads must recognize the existence of the public streets and the uses to which they are put. The users of the highways and of the railroads have mutual rights and mutual duties which must alike be observed. If an enforcement of the State laws as to the movement of trains over streets and highways is not sufficient to safeguard those using the streets of the city of Flint, they may be supplemented by the enactment and enforcement of reasonable ordinances and by the maintenance of gates and the keeping of watchmen at the street crossings as may be required by the public utilities commission.

The decree is reversed and one may be entered here in accordance with this opinion, with costs in favor of the defendant.

Bird, C. J., and Steere, Brooke, Fellows, Stone, and Kuhn, JJ., concurred.

The late Justice Ostrander took no part in this decision.


text:
    BURLESON v. BLAIR.
    1. Fraud — Frauds, Statute of — Representations as to Credit of Another.
    In an action for the value of certain bonds sold to plaintiff by defendant by reason of alleged fraudulent representations as to their value, the statute of frauds (3 Comp. Laws 1915, | 11983) requiring representation or assurance as to the credit, etc., of any other person to be in writing and signed by the party to be charged, in order to sustain an action thereon, has no application if defendant was the owner of said bonds or if he profited by the transaction.
    2. Same — Evidence—Sufficiency—Question for Jury.
    Where plaintiff’s testimony as to defendant’s representations that he was the owner of the bonds was corroborated, the court below was 'in error in holding that there was no proof to go to the jury on that question.
    3. Same — Frauds, Statute of — Applicability—Personal Profit.
    Where defendant, the cashier of a bank at the time he sold the bonds for a brokerage firm, had an arrangement with said firm, of which he was a stockholder, to become its treasurer and director and take charge pf the sale of bonds, in thé near future, at an advance of salary over what he was receiving, and later received the position which he desired, he-M, to be such profit as to render inapplicable said statute of frauds, although he did not receive a direct commission.
    Error to superior court of Grand Rapids; Dunham, J.
    Submitted January 10, 1919.
    (Docket No. 26.)
    Decided October 6, 1919.
    Rehearing denied December 23, 1919.
    Assumpsit by Willard M. Burleson against Hugh Blair for the purchase price of certain stock. Judgment for defendant non obstante veredicto. Plaintiff brings error.
    Reversed, and case remanded with directions to enter judgment on the verdict with leave to renew motion for new trial if desired.

      Louis T. Herman (Charles E. Ward, of counsel), for appellant.

      Butterfield & Keeney and Myron H. Walker (Charles B. Blair, of counsel), for appellee.
   Bird, C. J.

Plaintiff brought suit in assumpsit to recover the purchase price of 8 Laramie Municipal District Bonds of $500 each, which he purchased from defendant in April, 1909, on the ground that the purchase was induced' by false representations as to their value. Plaintiff was successful in establishing his claim before thp jury, they finding a verdict for him in the sum of $5,285.38. Subsequently a judgment was entered for defendant by direction of the court, notwithstanding the verdict. The main question discussed is whether the trial court was justified in so doing.

1. At the time the parties had their dealings both were residents of Grand Rapids. Plaintiff was practicing his profession as physician and surgeon, while the defendant held the position , of cashier of the City Trust & Savings Bank. Plaintiff claims that, by invitation of the defendant, he visited the bank on April 8, 1909, and when he arrived there he found that defendant wanted to talk with him about purchasing some irrigation bonds. Referring to the false representations, plaintiff testified in substance that defendant said to him:

“You have a certificate of deposit here for $3,000, drawing 3%. I have got some bonds as good as government bonds, drawing 6% interest that I want to sell you. They are bonds of the Laramie Valley Municipal Irrigation District of Wyoming. They are municipal bonds, the same as municipal bonds in a city, such as sewer taxes and improvements. The government built this irrigation project in Wyoming and then turned it over to the district and the district has issued these bonds, and they are a first lien on everything, including all the land and all of the irrigation project. I have been out there and have been all over this project (here defendant brought out 7 or 8 loose leaf productions of photographs of harvest scenes and growing crops, such as would only be seen on exceptionally fertile soil), defendant then said: I have seen those conditions and those pictures were taken while I was there, and I can vouch for their correctness. I have seen the James Lake System, and it is all completed, and in use. The land in this irrigation district is selling from eighty to one hundred dollars an acre. Everything is completed and in use. The land is all under irrigation in this district and improved, everything is all settled and all under cultivation, all prosperous farmers. The bonds, being a first lien on all of this valuable improved land and irrigation system, are very valuable and, therefore, are selling above par, at 101.”

Plaintiff testified that relying on defendant’s representations concerning the bonds and the security behind them, he purchased eight $500 bonds; that defendant computed the interest due him on the certificate of deposit, that he then went to his place of business, secured a check from his brother for the balance, came back and delivered the same to defendant and the defendant delivered to him the bonds, after which he redelivered them to defendant as collateral security for the loan, in place of the certificate of deposit, and took a receipt therefor.

Defendant’s version of what took place is in serious conflict with plaintiff’s version on many of the material matters. It is. the claim of defendant that he himself did not own any of the bonds. He admits having an interview with plaintiff concerning the purchase of the bonds, but denies that he sought it. His version is that it came about by the suggestion of Mr. Sibley, the father-in-law of plaintiff’s brother, and that his first interview with plaintiff took place on the 7th of April, upon which date the plaintiff signed an order for the bonds, directed to Child, Hulswit & Company, brokers of Grand Rapids; that the order was handed over by him to that company, and in pursuance of said order the bonds were ordered from Chicago and delivered to him the next day, April 8th, and that later in the day he delivered them to the plaintiff. He further testified that he received 'nothing as commission for bringing about the sale.

Plaintiff introduced testimony tending to show that certain material representations made by defendant with reference to the security and value of the bonds were untrue, but we need not dwell upon that phase of the case as defendant conceded that if the claimed representations were made by him they were untrue.

The principal defense was that even if the statements were made as testified to by plaintiff they were not admissible in evidence by reason of the statute of frauds, which provides that:

“No action shall be brought to charge any person, upon or by reason of any favorable representation or assurance, made concerning the character, conduct, credit, ability, trade or dealings of any other person, unless such representation or assurance be made in writing, and signed by the party to be charged thereby, or by some person thereunto by him lawfully authorized.” 3 Comp. Laws 1915, § 11983.

Plaintiff meets this defense by the assertion that the statute does not apply when the property about which the representations were made belonged to the one making the representations, nor when the party making the representations profits by the transaction.

Defendant does not seriously dispute this, but he insists that there is no competent proof that he was the owner of the bonds; neither is there any proof that he profited by the transaction, but on the other hand there is positive proof that he did not own the bonds and that he did not profit by the sale of the bonds; and it is argued that, with these representations eliminated by the statute, there is nothing left of plaintiff’s case.

We think it is clear that if defendant were the owner of the bonds or profited by the transaction, the statute does not apply. In construing this statute, Mr. Justice Campbell said:

“The legal provision concerning the necessity of representations in writing to sustain an action upon favorable assurances concerning the character, conduct, ability, trade or dealings of another person, was intended to reach cases where the plaintiff has dealt with and given credit to the person favorably mentioned, and done so on the faith of the assurances. That statute cannot apply to conspiracies or frauds, where the representation is made to enable the party making it to profit by it.” Hess v. Culver, 77 Mich. 598 (6 L. R. A. 498, 18 Am. St. Rep. 421).

And this construction was later approved in the case of Massey v. Luce, 158 Mich. 133. The material questions, therefore, to be determined are:

(a) Was the question of defendant’s ownership of the bonds one for the jury?

(5) Does the record show that defendant profited by the transaction?

a. Was defendant’s ownership of the bonds an issue for the jury? The plaintiff testified that defendant represented that he was the owner of the bonds, and • that he delivered them to him. Mr. Sibley’s testimony tends to corroborate plaintiff’s testimony in this respect. Defendant denied that he owned the bonds and denied that he so represented to plaintiff. He claims plaintiff signed an order, addressed to Child, Hulswit & Company, for the bonds, and claims that he read it to plaintiff in Sibley’s presence. Both Burleson and Sibley deny this, and plaintiff denies that he signed the order. The question as to whether the signature to the order was the genuine signature of the doctor was much controverted. Several business people and experts gave it as their opinion that it was the genuine signature of the doctor. One expert thought it was not. The twelve jurors who examined it concluded it was not the doctor’s signature, and they answered a special question propounded by defendant that it was not the doctor’s signature.

While the testimony of defendant as to his ownership of the bonds and as to the signature of the doctor is quite convincing, we do not feel that it is within the province of this court to say that the positive testimony of Dr. Burleson, the corroborating evidence of Mr. Sibley, the opinion of Mr. Patterson, the expert, and the ocular inspection by twelve jurors in connection with the other testimony in the case did not make an issue of fact. We are of the opinion that the trial court was in error in holding that as between the parties there was no proof to go to the jury on the question of defendant’s ownership of the bonds.

6. We are also of the opinion that, under the uncontradicted testimony, the defendant did profit by the transaction to such an extent that the provisions of the statute do not apply. When the defendant made the sale to plaintiff he was not only a stockholder of Child, Hulswit & Company, but had an arrangement with that company to become its treasurer and director and take charge of the sale of irrigation bonds, and within 10 days after the sale he was elected director and treasurer of the company, with an advance of salary over what he was receiving as cashier of $1,600, and on May 1st he assumed these duties. When the sale was made he had already resigned his position in the bank. On April 8th he and Mr. Child had just returned from a trip to Denver to inspect the irrigation projects in that vicinity which had issued, or was about to issue, bonds. On this trip defendant was the guest of, and his expenses were paid by, Trowbridge & Niver, Chicago brokers, who were handling these irrigation issues. The following excerpts taken from the testimony of defendant Blair tend to show his interest in his future employer:

“When I went to Denver I knew I was going to quit the bank, and I knew at that time that I was going with Child, Hulswit & Company, and so at the invitation of Trowbridge & Niver, I went west and took Mr. Child with me. That was the last week in March, 1909, and I was going to engage in the sale of irrigation bonds if the project looked good to me. I was going for the purpose of making a personal investigation of the Denver-Greeley projects and the other two projects for Child, Hulswit & Company. I was going to be the active man in charge, I was going to be the bond man. I wanted to go out there and satisfy myself that all was well. * * * The reason they took us out there was to close the deal with us so we would take on the sale of the bonds. That was the understanding. * * *
“Q. Witness, you have said on direct examination, didn’t you, that you went out there for the purpose of preparing yourself on the sale of these bonds?
“A. That, and to see whether I wanted to enter into it as Trowbridge & Niver had suggested our doing. After resigning from the bank I had an understanding with Child, Hulswit & Company that I was to go out west. Then it was all arranged before I went west except the formal meeting electing me director and treasurer.”

Mr. Child, of Child, Hulswit & Company, referring to the $4,000 of bonds sold to plaintiff, testified, upon cross-examination, as follows:

“Q. Do you recall personally of this order coming-in there on the 7th of April?
“A. Yes, I do.
“Q. It was quite a shock to you to get an order like that unsolicited.
“A. It was not a shock.
“Q. A surprise?
“A. No, it was a pleasant thing to have -come in, because it was one of the first sales, a sale of any amount of irrigation bonds, and naturally I noticed it.
“Q. You learned a little later on — in fact you learned from a letter — that it did come through the instrumentality of Hugh Blair?
“A. Yes, sir. I saw the City Trust & Saving Bank on there and I saw it was his handwriting. Prior to that time Hugh Blair and I had been out west to look over the irrigation projects. That was about the latter part of March, 1909. At that time we were contemplating taking on the sale of irrigation bonds in addition to other bonds. We were contemplating putting Hugh Blair in charge of that field.
“Q. You were a little bit pleased to know Hugh Blair on this day had sold the highest amount of irrigation bonds that had ever been sold by your firm?
“A. Yes; I was pleased to get the order, naturally.
“Q. You were so pleased that you made considerable commission out of it?
“A. I do not see that that has anything particular to do with the pleasure.
“Q. You were in the business for the money you made?
“A. Yes, we were, surely. The profit on the sale of $4,000 of bonds, that profit would not be sufficient to give any great amount of pleasure. The fact, as stated before, we were expecting Mr. Blair was coming with us, this was an indication to me — that—
“Q. He would make good?
“A. Yes, and possibly this, that he knew people who could buy bonds. * * *
“Q. During that month, when he was still in the bank, whenever he would send you any of these customers he did it purely out of personal motives, I suppose, because he was a friend of yours?
“A. Sure, because he was planning then to come with us, and he wanted to do anything he could to develop the business,, naturally. I think he was elected director and officer of our association about the 17th of April, 1909.
“Q. Prior to that time you had concluded by reason of the fact that you elected him to this position to handle your bonds, you had concluded that he had demonstrated his ability to make good, hadn’t you?
“A. Well, I would not exactly say that. We felt he could make good, but I think it would be rather a difficult thing for a man in making a few sales of bonds to demonstrate that he could make good.”

Later, on direct-examination, the witness testified:

“When I replied to Mr. Herman, that I felt, when Mr. Blair came with our company he could make good, I meant by that, that he would be able to sell and negotiate the sale of securities in such amounts as would make it worth while to have him associated with our association, that is, that he would develop ability in that regard and command the confidence of the community.”

Occupying the position that Mr. Blair did during this transaction, can it be said that he did not profit by the sale of the bonds, which netted a commission of $240 to Child, Hulswit & Company, because that company did not hand him a check for two per cent., or some other reasonable amount, as commission? Does anyone believe that Mr. Blair would have sold these, and other bonds, netting the company a commission of $1,334 without compensation, if there had been no arrangement for him to ally himself with that company in less than 30 days thereafter? Men who work for a living are not ordinarily as liberal as that. It is not unusual for men to grow liberal when they have some ulterior purpose to serve. Blair was reaching for a position and for an advance in salary, which had not yet been fixed. He was trying to convince Child, Hulswit & Company that he was the man they were after, that he could, make good, and instead of accepting the check for his proportion of the commission of the sales he waived it in order to secure something of more importance. During the days when these sales were made Mr. Blair manifested the same interest in Child, Hulswit & Company that he did afterward when he became a part of it. He admits that he did the same work afterwards as before. He demonstrated Ms fitness for the position and succeeded in getting what he was after.

It is also worthy of comment that plaintiff did not seek defendant and solicit information concerning the credit and ability, etc., of the Laramie irrigation district, as is usually the case when this statute is invoked, but Blair sought plaintiff, knowing he had money on deposit in the trust company. He tried to reach him through Mr. Sibley. Failing in this, he communicated directly with him. After he reached him, he deliberately advised him to withdraw deposits from the bank he, himself, was paid to serve and invest it in bonds from which Child, Hulswit & Company, his future employer, would reap a commission of $240. This evinces his eagerness to please Child, Hulswit & Company, and to demonstrate his fitness for the position he was about to fill. In this he succeeded, and in his success he found his compensation. By refusing to make a direct charge for services which are ordinarily compensated, for the purpose of capitalizing it in another direction, he cannot be heard to say that he received no profit from the transaction.

The judgment for defendant must be vacated and judgment entered for plaintiff on the verdict of the jury.

Moore, Steere, Brooke, Fellows, Stone, and KUHN, JJ., concurred.

The late Justice Ostrander took no part in this decision.

On Motion for Rehearing.

On denial of a motion for rehearing, the order was' modified to remand with directions to enter judgment on the verdict with leave to renew motion for new trial if desired.


author: Steeee, J.

text:
    BARNHARDT v. HAMEL.
    1. Fraud — Exchange of Property — False Representations — Remedies.
    Where plaintiff is defrauded in an exchange of land he may disaffirm the contract, tender reconveyance and demand reconveyance or refund of what he parted with, and, if refused, bring suit to recover the same, or he may affirm the contract, retain what he received thereunder, and, bring an action for fraud to recover his damages.
    2. Same — Measure of Damages.
    In the latter case his measure of damages would be the difference between what the value would have been if the representations had been true and the actual value of what he received,
    3. Same — Condonation—Settlement—Defenses.
    The acceptance by defendant of a note from plaintiff for the amount of undisclosed additional incumbrance upon land received by defendant in the exchange, not discovered until some time after the transaction had been completed, held, to amount to condonation of the misrepresentation, and not a bar to an action for fraud brought by plaintiff.
    4. Same-lability to Fulfill Contract — Defenses.
    Plaintiff’s inability to fulfill his future obligations under his contract to purchase a farm from defendant, as part of the transaction, is not to be determined as a matter of law, where the contract recited that the balance is “payable in five years,” and he is not shown to be in default, although he had paid nothing on the contract since it was executed, and had moved off the premises in question.
    5. Same — Inspection of Land — Misrepresentations—Estoppel.
    The fact that plaintiff visited the farm with defendant's agent at a time of year when crops were not growing, and looked it over would not preclude him, as a matter of law, from making proof of material, fraudulent representations as to facts not then discovered by, or reasonably apparent to, him, such as the exhausted condition of the soil, possibility of drainage, or that the land had a clay subsoil.
    6. SAME' — Misrepresentations — Whether Discoverable Not a Question of Law.
    Whether the truth of said claimed representations of facts was apparent or discoverable by him under the circumstances is not a question of law.
    7. Same — Evidence—Pleading—Variance—Prejudicial Error.
    Permitting witness to answer in the affirmative a leading question as to whether the farm in question was more susceptible to frosts than other farms in that vicinity, although no claim of this nature was made in the declaration, in view of testimony that in the “year of the big frost” there was a frost which was quite general in that part of the State, held, prejudicial.
    8. Same — Trial—Exciting Sympathy of Jury — Curing Error.
    Where plaintiff’s real claim of fraud related to the soil, and not the elements, but throughout the trial by evidence, argument, and ruling of the court the misfortunes and distress which befell plaintiff and his family by reason of failure of crops partly due to frost one season, and to unusually hot, dry weather another, was emphasized, held, prejudicial, although the court instructed the jury not to let their sympathy influence their verdict.
    9. Same — Diligence in Discovering — -Statute of Limitations.
    In an action for damages for fraud in an exchange of land, no special diligence is required to discover the fraud or in bringing such action after discovery short of the statute of limitations.
    Error to Manistee; Withey, J.
    Submitted February 4, 1919.
    (Docket No. 84.)
    Decided October 6, 1919.
    Assumpsit by Elizabeth Earnhardt and another against Adolph Hamel and Adolph Kann, copartners as Hamel, Kann & Company, for fraud and deceit in the exchange of real- property. Judgment for plaintiffs. Defendants bring error.
    Reversed.

      Smurthwaite & Campbell, for appellants.

      Harry F. Hittle (Max E. Neal, of counsel), for appellees.
   Steeee, J.

Plaintiffs recovered a verdict and judgment for $2,400 against defendants as damages for fraud claimed to have been practiced upon them by the latter in a land deal negotiated in April, 1914. At that time defendants were and had been for some years in the business of selling farm lands in the vicinity of Manistee and adjoining counties, with their headquarters and office in Manistee, Michigan.

Plaintiffs, who are husband and wife, then owned and resided upon a small farm of 19% acres in Allen county, Indiana, located about 9 miles southwest of Fort Wayne, which they valued at $3,500. Defendants owned and had for sale a farm of 120 acres, called the “Strine Farm,” located in Arcadia township, Manistee county, Michigan, on which they put a price of $6,000, or $50 per acre. The parties were brought together through the activities of one John W. Long, of Monroe-ville, Indiana, whose business was “real estate and law,” who had known both contracting parties for some time and was experienced in selling Michigan farms, as he testified. Although some question is raised by defendants as to the scope of his agency, it is undisputed that he initiated negotiations and closed a contract between these parties by authority of defendants, from whom he received a commission and for whom he testified he had sold several farms since then — had been in their office he supposed 40 times.

The transaction involved an exchange of the two properties on a basis of $3,500 for plaintiffs’ 19% acres in Indiana, and $6,000 for defendants’ Strine farm in Michigan, plaintiffs to deed their land to defendants subject to a $1,500 mortgage and defendants to eventually deed the Strine farm to plaintiffs who were to give a mortgage back on it for '$4,000 as balance of the purchase price. The contract was closed at Barnhardt’s home in Indiana where Long, who drew the initial papers, went for that purpose after Earnhardt had been to Michigan with Long on the latter’s solicitation to look at Michigan lands and had seen the Strine farm. The initial paper drawn by Long was a land contract from “A. Kann & Co.” to plaintiffs agreeing to sell and convey them the Strine farm (giving legal description) for $6,000, payable $2,000 cash arid $4,000 within five years from March 1,1915, with interest at 6% from date, the instrument being dated April 20, 1914. Growing crops on the premises were reserved, possession was to be given March 1, 1915, and “deed to be made and abstract delivered at Monroeville, R. No. 4, on or before October 1st, 1914.” This instrument in duplicate was signed first in order by plaintiffs, followed by “A. Kann & Co., per Jno. W. Long.” On it was indorsed a receipt for $2,000, dated April 20, 1914, signed “A. Kann & Co. per Jno. W. Long.” Long also drew up a short form deed from plaintiffs to defendant Adolph Kann containing what was supposed to be (but was not) a description of plaintiffs’ Indiana land for one dollar and other valuable considerations, dated April 30, 1914, which defendants executed, acknowledged before and delivered to him.

In the spring of 1915 Barnhardt moved with his family, consisting of a wife and 10 children, to Michigan and settled upon the Strine farm which he proceeded to cultivate. Up to that time the details of the business had been attended to by Long who both drew up the papers and as agent signed what purported to be defendants’ firm name where it was required. But, as Kann testified he authorized Long to close the deal and it was subsequently ratified by defendants, they are not in a position to question his agency beyond, at most, their denial of his authority to make certain charged untruthful representations upon which plaintiffs claim to have relied.

About 80 acres of the Strine farm had long been cleared and under cultivation. It was an old place with fairly good farm buildings and other improvements, including an orchard of four acres. Earnhardt looked over the buildings and improvements when he visited the place in April, 1914, and no complaint is made of any fraud or misrepresentation as to them. The improved portion was sandy soil which had been farmed for many years and, as claimed, to exhaustion. A neighbor - named Bradford testified that he had known the farm for over 40 years, that it was “old land and to be productive in that community it must be fertilized.” The back 40 was unimproved swamp land. Bamhardt accompanied Long to Michigan to look at farms and was taken by him to look at this and other places in an automobile, in company with a driver Kann furnished, at a time when no crops were growing. They were at this farm about an hour during which time he looked through the buildings and improvements generally and walked across some of the cultivated land which he was assured was sandy loam with a clay sub-soil. On returning to Manistee he and Long went to Kann’s office and talked of the matter. Two other farms were also under consideration but this one had impressed him more favorably because of its larger acreage. He testified that Kann asserted it was a very good farm, raised good crops of all kinds, such as. corn, wheat, oats, potatoes and a lot of hay, being all good farming land; that after his return to Indiana Long visited their home and repeated these assurances, with various other laudatory statements as to the place and surrounding conditions, to him and his wife. While many things are charged in plaintiffs’ declaration the substantial false and fraudulent representations claimed to have been made by Kann and Long by which they were induced to enter into the agreement related to the nature and fertility of the soil and that the marsh could be reclaimed and made good farming land, also the market value of such land in that part of Michigan.

After moving his family and personal effects to Michigan in April, 1915, Barnhardt was in somewhat straitened circumstances and borrowed some money from Kann. He proceeded energetically to work the farm with the assistance of his oldest son, who was 14 years of age. With such facilities as he had he planted and cultivated quite an acreage of various crops, including 28 acres of corn, 14 acres of beans and 6 acres of potatoes.

Some time before July, Kann discovered that the deed from plaintiffs to him of the Indiana place contained a wrong description and went out to their farm where he had them execute another deed, dated July 7,1915, which properly described the property. He was there but a few minutes and explained the necessity of their signing a deed to correct the description, which they did without protest although Barnhardt then told him the starting'crops did not look very good. However they might otherwise have turned out, a killing frost during the summer practically destroyed the crops, that being what witness spoke of as “the year of the big frost” which was quite general in that section of Michigan. Soon after finding the error in the deed Kann also discovered unpaid back interest on the $1,500 mortgage plaintiffs left on the Indiana land and that there was in addition a second mortgage for $300 on the land which he had to pay. When confronted with these discrepancies Barnhardt gave Kann a note, dated July 25, 1915, for $351.89 due December 1, 1916, which was never paid. He also later in the season acknowledged liability for some delinquent taxes against the Indiana land.

The second season (1916) he again planted and cultivated the farm, but the crops were poor and it produced but little. He admitted the weather was hot and dry during that summer and it was a poor year for farming. Finding, as he testified, that he was unable to support his family by what he could raise on the farm, and having discovered by experience the misrepresentations and fraud imposed upon him by defendants as to the nature and value of the farm, he moved with his family to the nearby village of Arcadia and found employment in a furniture factory, after which he began this action to recover damages for the fraud and deceit practiced upon him.

Plaintiffs introduced testimony to the effect that the tillable portion of this farm was light, sandy soil, with no clay sub-soil, and was run down, worn out, old land which had been improperly worked without fertilization and cropped to exhaustion; that a fair market value of that portion of the place in its then worn out condition did hot exceed $20 per acre, and about 30 acres of the back, uncleared 40 acres was worthless marsh, so wet, soft and boggy that stock could not even go upon it' to pasture and so low that drainage was impossible; while defendants in person or by their agent Long had represented and asserted the market value of the 120 acres to be fully $50 per acre and cheap at that price, the cultivated portion being good, fertile sandy loam with clay sub-soil which raised good crops, and the marshy, unimproved portion being good farming land which could be cleared, drained and farmed successfully. Defendants denied misrepresenting the place or conditions in any particular, insisted that they answered his questions about it truthfully, did not represent it was underlaid by a clay sub-soil, or that the marsh was susceptible of perfect drainage, contended that Barnhardt having examined the property and seen the nature of the soil and marsh to his own satisfaction was estopped from claiming he was misled; introduced testimony tending to show that the cultivated land was of average quality and fertility in that locality and the market value of improved farms in that vicinity was from $40 to $50 per acre. The highest appraisal by a disinterested witness which we find put upon this farm in its then condition is, however, $40 per acre for the cultivated portion.

Bamhardt had made no payment on the Strine farm beyond the $2,000 credited on his contract for the mortgaged 19% acres in Indiana, and it was conceded that in addition he owed Kann for the unpaid note above mentioned and other unsecured indebtedness, for seed furnished, back taxes on the Indiana land, etc., $599.98. This the trial court instructed the jury should be deducted from any damages they might find plaintiffs had suffered because of the claimed fraud, or if they found plaintiffs not entitled to recover the verdict should be for defendants in that amount under their claim of recoupment, and stated the measure of damages applicable to plaintiffs’ claim would be the difference between what the property would have been worth if defendants’ representations, as claimed, were true and what it was actually worth.

While conceding the general rule, defendants’ counsel contend that its application would be unjust and inequitable under the facts in this case, where plaintiffs themselves falsely stated the incumbrance upon their Indiana property and only had at best about $1,400 interest in the Strine farm upon which they made no further payments and abandoned it at the end of the second season; and in any event the jury should have been instructed that plaintiffs having failed to remain and, on their part, abandoned the farm and contract, recovery could not exceed their actual interest in the land.

No requests were tendered to the court upon the question of damages by defendant. This is an action át law for a claimed fraud perpetrated upon plaintiffs with no claim of rescission or tender back of the property. They could have either disaffirmed the contract, tendered reconveyance with demand for refund, or re-conveyance of the Indiana property, and, if refused, brought suit to- recover the same or affirm the contract and, retaining that which they acquired under the same, bring an action for fraud to recover as damages the difference between the value of what they would have received if the representations were true and the value of what they actually received. Smith v. Realty Co., 175 Mich. 600. They saw fit to adopt the latter remedy and affirm the contract. Their misrepresentation as to the amount of incumbrance on their Indiana land was condoned and settled shortly after they moved upon the farm, before they had on their part learned of the fraud they now complain of, as they claim, and it cannot now be urged by defendants as a bar to this action. Neither is plaintiffs’ inability to fulfill their future obligations under their contract for purchase of the Strine farm to be determined as a matter of law. Whatever their indebtedness or delinquencies may otherwise be, they are not shown to have been, when this action was brought, in default on their contract to purchase the farm signed by them at their home in Indiana, drawn up and signed by Long for defendants, which they subsequently ratified, accepted the benefits therefrom and have since retained. It recites that “This contract contains all the agreements between the parties hereto,” acknowledges payment of $2,000 down, and makes the deferred payment of $4,000 “payable in five years from March 1, 1915, at 6% interest from date.”

The circumstance that plaintiff, chaperoned by Long, went to and spent an hour on the farm looking it over at the time of year shown would not preclude him as a matter of law from making proof of material, fraudulent representations as to facts hot then discovered by or reasonably apparent to him, such as the exhausted condition of the soil, possibility of draining the swamp, or that the land had a clay sub-soil. Whether the truth of these claimed representations of facts was apparent or discoverable by him under the circumstances was not a question of law. Jackson v. Armstrong, 50 Mich. 68.

In the re-examination of a willing witness for plaintiff named Rowan he was asked, “Is this farm of Mr. Earnhardt’s subject to frost?” to which defendants’ counsel objected as immaterial and because no charge of that kind was declared upon by plaintiff, whose counsel said in reply that it was brought up on cross-examination, to which the court said:

“No; that is not all there is about it. The plaintiffs’ claim is, the defendant represented it good for farming purposes, for crops generally, and if the locality and this land in particular is subject to frosts and to freezing that is pertinent and should be inquired into. The objection is overruled. It goes to the very gist of the action — whether it is good for farming purposes or not.”

The witness was then permitted to answer the leading question if it was more susceptible to frosts than other farms in that vicinity, and said the rear of it was, where near the swamp, the same as land he was working, but the balance as a rule was not. As no claim of this nature is made in plaintiffs’ declaration, nor covered by any of the representations claimed to have been fraudulently made by defendants, the argumentative ruling was particularly prejudicial in connection with the fact which was incidentally and inevitably disclosed in the progress of the trial that plaintiffs had lost their first crops from that cause in the “year of the big frost” which was quite general in that part of the State. Plaintiffs’ real claim of fraud related to the soil, not the elements; but, carried through the trial by evidence, argument and ruling of the court, is emphasized the misfortunes and distress which befell plaintiffs and their children by reason of the failure of their crops during those two years, concededly due, in part at least, to the year of the big frost, followed by an unusually hot, dry season. On this subject the court told the jury they had a right to have “all the sympathy that is commensurate with the situation for an unfortunate in any and every case,” which should not, however, influence their finding, and further said in part:

“You cannot help sympathizing with Mr. and Mrs. Earnhardt and the family; may be you sympathize with Mr. Kann in his troubles, but you must not let that influence your verdict, — not one particle.”

Barnhardt was permitted to testify that he was unable to earn a living from the place for his family and members of it were obliged to work elsewhere to that end, and his wife after testifying in general to the same effect was permitted against objection to testify as to their numerous family, that their friends and neighbors contributed to their support and gave them clothes for the children, because they did not have enough and needed them. When counsel for plaintiff had apparently exhausted the subject and said, “I think that is all,” the court suggested:

“Why don’t you find out why she didn’t buy herself clothes and clothing for the family?”

Counsel then renewed the subject, asking:

. “Q. Why didn’t your husband and yourself buy them clothes?”

Objection to which was overruled and the witness answered:

“He didn’t raise enough on the farm to buy the clothes we needed, and he had to work out.”

Plaintiffs’ counsel cite in support of this line of inquiry Yanelli v. Littlejohn, 172 Mich. 91. In that case there were no children whose deprivations were or could be stressed to rouse the sympathy of a jury. Commenting that some of the testimony complained of was remote and might properly have been excluded, the court went no farther than to hold:

—“that whether the plaintiff was able to live on the place, and the amount that could be produced there, were material questions, as well as the efforts made by the plaintiff and family in that direction.”

The testimony in this case did not stop there but was elaborated in the distress of plaintiffs’ children to a point where the court felt impelled to tell the jury that they could not help sympathizing not only with the plaintiffs in the case but with their family, and “may be” even with defendant Kann, as to whom no small children were shown to appertain. Despite this somewhat equivocal caution, we are impressed that a prejudicial tone was given to the case in the particular complained of, diverting from a fair and impartial trial of the real issues, which is reflected in the verdict.

Upon the chief grounds urged for the defense why a directed verdict should have been granted, it may be stated that under the testimony in this record we cannot accept the contention that as a matter of law plaintiffs have by any conduct following discovery of the claimed' fraud waived the same, or that lack of diligence after its discovery precludes this action. The relief asked in this form of action does not involve the parties being placed in statu quo, but is only to recover damages for a wrong done, and no special diligence is required to discover the fraud or in bringing such action after discovery short of the statute of limitations. Dayton v. Monroe, 47 Mich. 194; Smith v. McDonald, 139 Mich. 225; Smith v. Werkheiser, 152 Mich. 177 (15 L. R. A. [N. S.] 1092); Wegner v. Herkimer, 167 Mich. 587; Hutchinson v. Westbrook, 191 Mich. 484.

For the errors above pointed out the judgment must be set aside and a new trial awarded, with costs to defendants.

Bird, C. J., and Moore, Brooke, Fellows, Stone, and Kuhn, JJ., concurred.

The late Justice Ostrander took no part in this decision.