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1. Representations by one engaged in opening a tract of land for settlement, to induce the purchase of a lot therein, that upon receipt of a specified portion of the purchase money for the tract, street pavements, sidewalks, sewers, water mains, trees, and lights would be installed on the tract, will, if false, justify rescission of the contract for fraud if accompanied by false representations that many of the proposed improvements are actually under way, and that prominent people are engaged in erecting expensive dwellings on the tract.

[See note on this question beginning on page 343.] Trial directing verdict effect.

2. An instruction which directs a verdict has the same effect as an order sustaining a motion for nonsuit, in that it admits the truth of the adversary's evidence and every inference of fact that may be legitimately drawn therefrom.

[See 26 R. C. L. 1068.]

Fraud failure to perform promise. 3. While a failure to perform a promise cannot amount to fraud, if such promise is accompanied by a statement of existing fact which shows the ability of the promisor to Headnotes 2-4 by LEE, J.

perform, and without which the promise would not have been accepted or acted upon, such statement is a representation, and if falsely made is ground for avoiding a contract, though the thing promised to be done lies in the future.

[See 12 R. C. L. 257.]

-predicated on nonperformance of promise.

4. Fraud may be predicated upon the nonperformance of a promise in certain cases, where the promise is the device to accomplish the fraud.

[See 12 R. C. L. 254 et seq.; 2 R. C. L. Supp. 1409; 12 R. C. L. 257.]

APPEAL by defendant from a judgment of the District Court for Bannock County (Terrell, J.) to review a judgment in favor of plaintiff in an action brought to recover the amount alleged to be due on two promissory notes. Reversed.

The facts are stated in the opinion of the court.
Messrs. Paul S. Haddock and E. D.
Reynolds for appellant.

Messrs. Budge & Merrill, for respondent:

A party is not justified in relying upon representations made to him 27 A.L.R.-22.

which are offered as inducements for
him to enter upon certain conduct.
2 Pom. Eq. Jur. § 892.
False representations as a basis of
action, whether for damage or for
rescission of a contract, are such

only as in some manner actually mis- would be given as appellant might lead the party to his damage.

Marriner v. Dennison, 78 Cal. 202, 20 Pac. 386; Richardson v. Lowe, 79 C. C. A. 317, 149 Fed. 625; Jakway v. Proudfit, 76 Neb. 62, 106 N. W. 1039, 109 N. W. 388, 14 Ann. Cas. 258; American Bldg. & L. Asso. v. Bear, 48 Neb. 455, 67 N. W. 500; Lorenzen v. Kansas City Invest. Co. 44 Neb. 99, 62 N. W. 231.

Fraud without damage furnishes no ground for action, nor is fraud without damage a defense.

Woodson V. Winchester, 16 Cal. App. 472, 117 Pac. 565; Holton v. Noble, 83 Cal. 7, 23 Pac. 58.

A motion for nonsuit comes too late after the case has been submitted to the jury, or after the court has given peremptory instructions and discharged the jury, or after judg

ment.

38 Cyc. 1552; Drummond v. Louisville & N. R. Co. 109 Fed. 531; Baltimore & O. S. W. R. Co. v. Trennepohl, 44 Ind. App. 105, 87 N. E. 1059.

Since fraud must relate to facts then existing or which have previously existed, the general rule is that fraud cannot be predicated upon statements promissory in their nature, and relating to future action.

12 R. C. L. 21; Knowlton v. Keenan, 146 Mass. 86, 4 Am. St. Rep. 282, 15 N. E. 127; Bigelow v. Barnes, 121 Minn. 148, 45 L.R.A. (N.S.) 203, 140 N. W. 1032.

desire; (2) that respondent had received in cash one half of the total purchase price of said addition, and would forthwith pave, curb, and gutter the streets in said addition, lay concrete sidewalks and adequate sewer system and water mains, plant elm trees, and install cluster street lights, during the season of 1918, as provided in said agreement; (3) that it had contracted to sell all the lands in the east half of said addition; (4) that Clyde Bacon had purchased a number of lots in said addition, and had contracted to build during said season, and was then engaged in building, a house to cost $25,000; (5) that Peter Bethune and other purchasers of lots in said addition had building contracts for constructing dwelling houses during said season of 1918. Appellant alleges that all of these representations were false and fraudulent, and were made in bad faith, for the purpose of defrauding him, and that at the time of making the same respondent had no intention of keeping any of said promises, but that appellant had relied upon the same, and had been induced to execute and deliver said notes by reason of such promises, and had been greatly in

Lee, J., delivered the opinion of jured thereby; and that, upon dis

the court:

This action was commenced by respondent, Pocatello Security Trust Company, to recover against appellant, Walter W. Henry, upon two promissory notes.

The complaint contains a count upon each note in the usual form. The answer admits their execution and nonpayment, and as an affirmative defense alleges that they were given in payment for three lots in Blue Lakes addition west to Twin Falls town site, purchased in accordance with an agreement executed May 15, 1918, and that respondent, in order to induce appellant to enter into said agreement, made certain false and fraudulent representations: (1) That if appellant was unable to pay said notes at maturity, such extensions of time

covering the falsity of these representations, he had tendered a return of the possession of said lots and de

manded a rescission of the contract of purchase.

Upon issues thus joined, a trial was had to the court with a jury, and at the close of the evidence respondent moved the court for a directed verdict on the grounds: (a) That the affirmative allegations of the answer had not been sustained; (b) that it was not shown that any of the statements claimed to have been made were material; (c) that it was not shown that any of said statements were made with a knowledge of their falsity, or with intent to deceive, or that they did deceive, or that appellant acted upon such representations in execut ing said. notes; (d) or that appellant had sus

(35 Idaho, 321, 206 Pac. 175.))

tained any damage by reason thereof; (e) that the evidence was insufficient to constitute a defense.

Appellant moved for a nonsuit on the ground that respondent had not tendered a deed to the lands agreed to be purchased, which motion was denied as having been made too late. The jury was then directed to return a verdict for respondent for the full amount of the notes, together with interest and attorneys' fees. From the judgment entered upon this verdict, this appeal is taken.

represented to him that the condition in the agreement, which provided that upon the pavement of one half of the selling price of the entire addition in cash it would install these improvements, had been complied with, and that the sewers, curbs, gutters, cluster lights, and trees were already in, and that respondent was then engaged in putting in paving, and that all of these improvements had to be completed before the 1st of November of that year, and that Bethune and Bacon,

It is not necessary to consider all sheep men from Jerome; were then of the assignments of error.

An instruction which directs a

Trial-directing verdicteffect.

verdict has the same effect as an order sustaining a motion for nonsuit, in that it admits the truth of the adversary's evidence, and every inference of fact that may be legitimately drawn therefrom. In effect, it instructs the jury that there is no evidence to support the claim of the party against whom such verdict is directed. Keane v. Pittsburg Lead Min. Co. 17 Idaho, 179, 105 Pac. 60; Marshall v. Gilster, 34 Idaho, 420, 201 Pac. 711.

The agreement for the purchase of these lots for which these notes were given provides, among other things, that respondent, upon receiving cash payment for one half of the purchase price of said addition, would pave with bitulithic pavement the streets fronting on said lots for a width of 30 feet, would curb and gutter said streets, would lay a 5foot concrete sidewalk thereon, would lay adequate sewers and water mains, would set out elm trees 24 feet apart along said streets fronting on said lots, and have the same tended by a competent nurseryman for a period of two years, and would install cluster street lights, with standards set not more than 300 feet apart, upon the streets improved. Other conditions are contained in this agreement which it is not necessary to notice.

Appellant testified that when he made this agreement with the company's agent, Nerlon, such agent

constructing buildings in said addition; Bacon's house to cost $25,000.

The allegations in the answer with reference to the false and fraudulent representations, with the exception of that part relating to the houses then being constructed upon said premises, relate to promises of improvements that were to be installed in the future, and appellant's testimony that respondent's agent represented to him that certain of these improvements had already been constructed might have been objected to as not being within the allegations of the answer. But respondent's counsel, upon cross-examination, brought out the fact that respondent's agent had represented to appellant that the cluster lights were in, that there were 150 men then working on the pavement, that all the lots on the east side had been sold and just a few left on the west forty, that Clyde Bacon was then erecting a building to building to cost $25,000, Peter Bethune was also building a house, and a great number of other people were also constructing buildings, and that the biggest part of the paving was in on the east side, and they were working right along putting in all of the pavement.

The sale agreement does not fix a definite time when these improvements were to be completed, but appellant testifies that respondent's agent told him that they were to be made during the season of 1918, and that they had not been made at the time of the trial of this cause, the latter part of 1920. It appears from

an affidavit in the record that the company is now insolvent and in the hands of a receiver.

A number of these representations were made to other witnesses, particularly with regard to improvements to be made or that had been made in the way of paving, curbing, and guttering, laying sewers and water mains, and putting out shade trees. Upon objection being interposed, this line of testimony was excluded as incompetent and immaterial, on the ground that it related to promises of improvements which were to be made in the future. Respondent contends that, because these representations related to improvements that were to be installed in the future, such promises fall within the rule of expressions of opinion, and were not statements of fact upon which appellant had a right to rely; that they were not statements of fact, and could readily have been investigated as to their truthfulness. The court below appears to have adopted this view, and instructed a verdict for respondent accordingly.

As already observed, observed, an ininstructed verdict admits the truth of appellant's evidence, and all inferences that a jury would have been justified in drawing from it had the case been submitted to the jury. It results, therefore, that upon this record appellant was induced to purchase these lots upon the representation that the entire addition was then being paved, that sewers and water mains had been or would be laid, cement sidewalks put in, cluster lights installed, and ornamental trees put out, and that well-known, responsible citizens were then engaged in constructing residences, one to cost $25,000. These representations were the inducement that caused appellant to sign this contract of purchase and execute these notes in payment for this property, without which he would not have entered into the agreement. He states all of this positively, and is corroborated in part by other witnesses, and all testify that the representa

tions were false. Under this state of facts, we do not think that it can be said as a matter of law that all of these representations were of such character as to fall within the rule of being merely matters of opinion, or promises of future performance, and they could not, therefore, afford any ground for a rescission of this agreement or defense against the payment of these notes sued on, which were given for the purchase price of these lots.

It is frequently said that a promissory statement cannot be the basis of an action for deceit; and a prediction of future things is at best an opinion. It is undoubtedly true that a failure to perform a promise. cannot amount to fraud. In many jurisdictions, without consideration of the question whether a promise was made with an intention not to perform it, it is held that the making of the promise cannot be an actionable fraud. It has been pointed out, however, that, when a promise is made with intention not to perform it, the promisor is guilty of misrepresentation. 3 Williston, Contr. § 1496.

A statement which by itself might be a mere expression of opinion may be so connected with a statement of a material fact as to amount to fraud. A statement of value involving and coupled with a statement of a material fact is fraud. If a material fact is misrepresented, the addition of a promise to such misrepresentation does not prevent it from being fraud, if the other elements of fraud exist. Where the promise is made without any intent on the promisor's part to keep it, but to induce action on the part of the promisee, it is held to be fraud. Page, Contr. §§ 293-298. "Fraud may be predicated on the nonperformance of a prom- Frend ise in certain cases -predicated where the promise ance of promises. is the device to accomplish the fraud." 12 R. C. L. p. 257, § 23; Adams v. Schiffer, 11 Colo. 15, 7 Am. St. Rep. 202, 17 Pac. 21; Sweet v. Kimball, 166 Mass. 332, 55 Am.

on nonperform

(35 Idaho, 321, 206 Pac. 175.)

St. Rep. 406, 44 N. E. 243; Cerny v. Paxton & G. Co. 10 L.R.A. (N.S.) 640 and note (78 Neb. 134, 110 N. W. 882); Metcalf v. Hart, 3 Wyo. 513, 31 Am. St. Rep. 122, 27 Pac. 900, 31 Pac. 407.

False representations as to future events will constitute fraud, where these events depend upon the acts of the party making the representations, and form the inducement whereby the other party is led into the transaction. Henderson v. San Antonio & M. G. R. Co. 17 Tex. 560, 67 Am. Dec. 675.

"If the promise is accompanied with statements of existing facts which show the ability of the promisor to perform his promise, and without which the promise would not be accepted or acted upon, such statements are denominated representations, and if falsely made are grounds of avoiding the contract, though the thing promised to be done lies wholly in the future." Russ Lumber & Mill Co. v. Muscupiabe Land & Water Co. 120 Cal. 521, 65 Am. St. Rep. 186, 52 Pac. 995.

False representations by a vendor of land of his intention to make improvements which will benefit the property sold are ground for rescinding the contract. Roberts v. James, Ann. Cas. 1914B, 859, and note (83 N. J. L. 492, 85 Atl. 244).

One who is induced to buy lots in a proposed town by the representations of the proprietor that a dock will be constructed near the premises, and that a town will be laid out and built up, and the streets opened and improved, will be relieved in equity from the performance of the contract, where the proprietor abandons the intention of making the promised improvements and town never comes into existence, though it is not alleged that there was an intention not to perform when the sale was made. Rogers v. Salmon, 8 Paige, 559, 35 Am. Dec. 725; Roberts v. James, supra; Wilson v. Carpenter, 91 Va. 183, 50 Am. St. Rep. 824, 21 S. E. 243;

the

Cooper v. Ft. Smith & W. R. Co. 23
Okla. 139, 99 Pac. 785.

"A fraudulent promise which induces a person to act in such a way as to affect his legal right, or to alter his position to his injury or risk, is actionable." Cockrill v. Hall, 65 Cal. 326, 4 Pac. 33; Langley v. Rodriguez, 122 Cal. 580, 68 Am. St. Rep. 70, 55 Pac. 406; Brison v. Brison, 75 Cal. 525, 7 Am. St. Rep. 189, 17 Pac. 689.

"A representation within the meaning of the law of fraud is anything short of a warranty, which proceeds from the action or conduct of the party charged, and which is sufficient to create upon the mind a distinct impression of fact conducive to action." St. Louis & S. F. R. Co. v. Reed, 37 Okla. 350, 132 Pac. 355.

"Where the party alleges and proves that he was induced by material, false, and fraudulent repre

sentations to enter into a contract
which he would not have entered in-
to but for such false and fraudulent
a contract
representations,
obtained thereby is voidable." Mc-
Lean v. Southwestern Casualty Ins.
Co. 61 Okla. 79, 159 Pac. 660.

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"Any statement of an existing fact material to the person to whom it is made, which is false and known by the person making it to be false, and which is made to induce the execution of a contract, and which does induce the contract, is a fraud, which will sustain an action to avoid the contract." Adams v. Gillig, 199 N. Y. 314, 92 N. E. 670, 32 L.R.A. (N.S.) 127, and note, 20 Ann. Cas. 910 and note, citing the following authorities which sustain the foregoing: Old Colony Trust Co. v. Dubuque Light & Traction Co. (C. C.) 89 Fed. 794; Williams v. Kerr, 152 Pa. 560, 25 Atl. 618; Chicago, T. & M. C. R. Co. v. Titterington, 84 Tex. 218, 31 Am. St. Rep. 39, 19 S. W. 472. See also Rogers v. Salmon, supra.

Appellant's contention that one of the inducements for signing these notes was a promise that he was to be given such additional time to pay the same as he might desire is with

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