Case ID: wash_116/html/0430-01.html
Source: Caselaw Access Project
Author: {"author": "Main, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

[No. 16327.
    Department Two.
    July 28, 1921.]
    Anna Brown, Respondent, v. J. H. Hoffman et al., Appellants.
      
    
    Sales (53)—Rescission by Buyer—Fraud—Opportunity for Inspection. Wliere the sale of a rooming house was induced by false representations of the seller as to the condition of the business and its net income, the purchaser would be entitled to rescind the contract, notwithstanding an examination of the property had been made before its purchase.
    Appeal from a judgment of the superior court for Spokane county, Blake, J., entered February 2, 1920, in favor of plaintiff, in an action to rescind a contract for fraud, tried to the court.
    Affirmed.
    
      E. B. Quackenbush, for appellants.
    
      Frank H. Kinsell, for respondent.
    
      
      Reported in 199 Pac. 742.
    
   Main, J.

The purpose of this action was to rescind a contract for the purchase of a rooming house in the city of Spokane and to recover back the portion of the purchase price which had been paid. The trial resulted in a decree awarding- to the plaintiff the relief sought. From this judgment, the defendants appeal.

On the 24th day of June, 1918, the appellants were the owners of a rooming house, and through negotiations conducted by the appellant J. H. Hoffman, the same was sold to the respondent. The respondent remained in possession approximately one month, when she notified the appellants of her intention to rescind the contract, claiming that it had been induced by fraudulent representations.

In the complaint, a number of false representations are charged, but upon the trial the issue narrowed practically as to whether there was a misrepresentation as to the condition of the business and its net income. Upon this issue the evidence is in direct conflict. The trial court made no formal findings, but entered a decree which was equivalent to holding that the contract had been induced by fraud. It would serve no useful purpose to discuss the evidence in detail. It is sufficient to say that, after a careful examination of all the evidence, we are of the opinion that the trial judge reached the correct conclusion and that his judgment should be sustained.

This case is very similar to that of Sowles v. Fleetwood, 97 Wash. 166, 165 Pac. 1056, where it was held that the net income of a rooming house was a fact peculiarly within the knowledge of the seller and one upon which the purchaser had a right to rely, and if misrepresentation as to this fact was made, it would amount to fraud. So here, the respondent had a right to rely upon the representation of the seller as to the net income of the business. If the evidence offered on behalf of the respondent is to be believed, there was a serious misstatement of facts in this regard. The income was very materially less than it had been represented to be. The fact that the respondent examined the property before its purchase does not relieve the appellant from the charge of fraud, as held in the Fleetwood case, if there was misrepresentation as to the net income.

The judgment will be affirmed.

Parker, C. J., Fullerton, Mitchell, and Tolman, JJ., concur.