Case Name: J. C. CORBIN CO. v. PRESTON et al.
Court: Oregon Supreme Court
Jurisdiction: Oregon
Decision Date: 1923-09-25
Citations: 109 Or. 230
Docket Number: 
Parties: J. C. CORBIN CO. v. PRESTON et al.
Judges: McBride, C. J., and Bean and Brown, JJ., concur.
Reporter: Oregon Reports
Volume: 109
Pages: 230–254

Head Matter:
Motion to dismiss appeal denied January 30;
order denying motion to dismiss appeal sustained February 20,
argued on the merits July 12,
modified September 25,
rehearing denied November 7, 1923.
J. C. CORBIN CO. v. PRESTON et al.
(212 Pac. 541; 218 Pac. 917.)
Appeal and Error — Record Only Considered on Motion to Dismiss.
1. The court in passing on a motion to dismiss an appeal mil be governed entirely by the record.
Appeal and Error — Justification of Sureties on Undertaking to be Evidenced by Indorsement or Written Memorandum.
2. Under Section 55€, subdivisions 3 and 4, Or. L., providing for exceptions to sureties on appeal and their justification, and Sections 279 and 271, providing for the justification of bail and allowance, the justification of the sureties upon an undertaking on appeal should be evidenced by an indorsement on the undertaking by the judge or clerk or by some written memorandum indicating that the undertaking is approved.
Appeal and Error — Justification of Sureties Evidenced hy Indorsement or Order of Court.
3. The order of the court allowing the undertaking on appeal after the sureties were required to justify stands in place of an indorsement thereon required by Section 271, Or. L., and an order of court approving the undertaking is sufficient evidence of its allowance.
Appeal and Error — Time Within Which to File Transcript Runs from Approval of Undertaking.
4. Under Section 270; Or. L., providing that an appeal shall be deemed perfected from the expiration of the time allowed to exeept to the sureties in the undertaking, or from the justification thereof if excepted to, the time within which to file transcript did not ■begin to run after the examination of one surety had been completed, reduced to writing, signed, and until after the order of the judge approving the undertaking; the fact that justification of the other surety was waived not obviating the necessity of some record of the court's allowance of the undertaking.
Fraud — Predictions of Future Conduct of Third Persons not Actionable.
5. Actionable fraud cannot be based on erroneous predictions of future conduct of independent third parties.
Fraud — Purchaser of Lease not Entitled to Rely on Representations Contrary to Lease.
6. One purchasing interest of lessee under a written lease had no right to rely on representations or promises of the lessee, if made, that lessor would- assume liabilities or grant privileges not provided for in -the instrument, such as the making of repairs.
Fraud — Evidence Held to Show No Fraud on Part of Seller of Lease and Furniture Respecting Inspection of Premises.
7. Evidence held, to show that purchasers of lease and furniture of apartment house made such 'examination and inspection as to adequately inform them of physical condition of the several apartments, and that seller made no effort to keep them from inspecting other apartments.
Fraud — Representations by Seller as to Past Profits Actionable.
8. Representations by seller of lease and furniture of apartment house concerning her past income ox profits were material, and when intended to influence the sale, and an important element in inducing it, would support a recovery of damages.
Fraud — Recovery not Defeated Because Buyer Did not Inspect Books, Instead of Relying on Seller’s Statements.
9. Where seller of lease and furniture of apartment house misrepresented her past income or profits, recovery was not defeated because the buyer, instead of relying on such representations, did not ask for inspection of the seller’s books and accounts.
Fraud — Seller, Making Positive Assertion, must Speak Truth.
10. Where vendor makes statement concerning matters susceptible of accurate knowledge and in the form of a positive assertion, he is required to speak the truth, especially where evidence of the truth is contained in his own books of account.
Setoff and Counterclaim — Defendant Entitled to have Note and Chattel Mortgage Reduced by Amount of Damages from Fraud.
11. In replevin by assignee of purchase-money note and chattel mortgage to recover the property for purpose of foreclosure, in which defendants alleged fraud, they are entitled to have amount of note reduced to the extent of their damages from false representations shown to have been made.
Fraud — How Damages from Misrepresentation on Sale of Lease as to Profits Determined.
12. Where seller of lease and furniture of apartment house represented that her profits were approximately $100 a month more than they actually were, and there was no evidence of difference between selling price and actual reasonable market value, the damages must be determined by taking into consideration the unexpired term of the lease, the discrepancy in the profits, a.nd the unreliability of evidence of past profits in determining value.
Chattel Mortgages — Mortgagee Entitled to Possession of Property for Purpose of Foreclosure.
13. Assignee of purchase-money note and chattel mortgage was entitled after default to possession of the property to enable him to foreclose the mortgage and apply proceeds in satisfaction of amount due after crediting thereon damages recovered by -buyer for fraud.
Chattel Mortgages — -Provision, of Decree as in Case of Strict Foreclosure Erroneous.
14. In view of Section 10T84, Or. I/., requiring foreclosure of mortgage as therein provided, and fact that chattel mortgagee has only a lien, strict foreclosure cannot be granted, and provision of decree that on payment within thirty days defendants may purchase the mortgaged property, and otherwise t-hat all their light, title, and interest shall cease and determine, is erroneous.
Appeal and Error — Defendants cannot Complain of Provision of Foreclosure Decree Which Did not Affect Their Eights.
15. Whore provision of decree foreclosing chattel mortgage, such as would be proper upon strict foreclosure did not ¡affect defendants’ rights, except to suspend plaintiff’s right to proceed for thirty days, defendants have no valid ground of complaint.
From Multnomah: "Walter H. Evans, Judge.
Motion to Dismiss Appeal Denied.
Messrs, Winter <& Maguire, for the motion.
Mr. L. B. Sandblast and Mr. J. LeBoy Smith, contra.

Opinion:
BEAN, J.
Respondent moved to dismiss the appeal in this cause for the reason that the appellants failed to file a transcript of the record within the time allowed by law. Since the ruling upon the motion, a brief on behalf of respondent has been filed. We therefore give the matter further consideration, and make a memorandum of our determination.
It appears from the record that the decree herein was rendered on May 16, 1922. Defendants served a notice of appeal which was filed on July 14, 1922. On the 17th of that month exceptions to the sufficiency of the sureties on the undertaking on appeal were filed by respondent. On July 19, 1922, George O. Ulrich, one of the sureties on the undertaking, appeared before the judge to justify as to his qualifica tions as such surety. He was examined by Mr. Normal Kuykendall, an associate or member of the firm of Winter & Maguire, attorneys for respondent;, after which plaintiff by his counsel orally waived further examination of either surety. No record was made of the proceedings pertaining- to the justification until October 7, 1922. On the latter date, on motion of the plaintiff for an order nunc pro tunc to be entered as of July 19, 1922, allowing the undertaking on appeal, and upon the motion of defendants for entry of such order as of that date, October 7, 1922, the court denied the motion for a nunc pro tunc entry and approved the undertaking by the following order:
"It is Ordered and Adjudged, that said bond and undertaking be and the same is hereby allowed as of this date instead of the 19th day of July, 1922, the date of the actual allowance thereof."
It is indicated by the order made by the court, and by the briefs of counsel, that after the examination of one of the sureties there was a misunderstanding or "controversy" between the parties which the court did not pass upon. It is claimed in the brief on behalf of appellants that a printed form of inquiry was demanded by counsel for respondent, other than the one appearing at the time of the examination of the surety, to be executed by the surety, after July 19, 1922. As we view the matter, what occurred in relation to the surety after the date mentioned is immaterial, as this court in passing upon a motion to dismiss an appeal will be governed entirely by the record: Boise-Payette Lumber Co. v. Dominican Sisters, 102 Or. 314 (202 Pac. 554). On November 6, 1922, the time for filing the transcript was, by order of the trial court, extended until and including November 20, 1922. On the date last mentioned such time was so extended to and including November 25, 1922. On the latter date the transcript of record was filed in this court. The question for consideration is: "When did the time of thirty days for filing the transcript as provided in Section 554, Or. L., begin to run? If the date of the justification of the surety is October 7, 1922, then the order for the extension of the time for filing the transcript, and the filing of the same, were within the statutory period. If the date of the justification is July 19, 1922, the time of the examination of one of the sureties, then the transcript was filed too late.
The exceptions to the sufficiency of the sureties were filed in due time. The proceedings following are directed by Section 550, subdivision 3, Or. L., which reads:
"(3) The qualifications of sureties in the undertaking on appeal shall be the same as in bail on arrest, and, if excepted to, they shall justify in like manner",*
and subdivision 4 of that section, which so far as material here, reads thus:
"(4) From the expiration of the time allowed to except to the sureties in the undertaking, or from the justification thereof if excepted to, the appeal shall be deemed perfected. "
Section 270, Or. L., is as follows:
"Justification of Bail. — For' the purpose of justifi cation, each of the bail shall attend before the judge or clerk, at the tipie and place mentioned in the notice, and may be examined on oath, on the part of the plaintiff, touching his sufficiency, in such manner as the judge or clerk in his discretion may think proper. The examination shall be reduced to writ ing and subscribed by the bail, if required by the plaintiff. ' '
Section 271, Or. L., reads thus:
"Allowance of Bail. — If the judge or clerk shall find the bail sufficient, he shall annex the examination to the undertaking, indorse his allowance thereon, and cause them to be filed with the clerk of the court in which the action is pending; "
, In the case of Moorehouse v. Weister, 56 Or. 126 (95 Pac. 497, 107 Pac. 470, 108 Pac. 121), this court, after referring to the statute, in determining whether the justification of the sureties on an undertaking on appeal is at the time the surety appears before the officer for examination, or at the time the examination is completed, and the undertaking approved, held as follows:
"Under the statute the justification of a surety consists in his examination before the officer at a time and place specified, the reduction of such examination to writing, and signing of the same by the surety, when requested, and a finding that the surety is sufficient by the officer before whom the examination is had, which is evidenced by the indorsement on the undertaking."
See, also, Logan v. Cross, 98 Or. 274 (192 Pac. 656, 1119).
It is clear from the statute, and the opinion referred to, that the proceedings for justification of the sureties upon an undertaking on appeal after exceptions to the sufficiency of such sureties have been filed, should be evidenced by an indorsement on the undertaking by the officer before whom the examination is made, whether the judge or clerk, or by some written memorandum indicating that the undertaking on appeal is approved. The requirement of the stat ute as to indorsement has a twofold purpose; one to show the official approval of the bond, and the other to definitely fix the time for filing the transcript of record.
There is no indorsement of the allowance on the undertaking on appeal in the present case. Therefore the order of the court allowing the undertaking stands in place of such an indorsement. The justification was not complete until after the examination of one of the sureties, and the waiver of respondent as to the examination of the other surety, and the reduction of such examination to writing, the signing of the same by the surety, if it was requested, and the finding by the judge that the sureties were sufficient. This finding, as stated, must be evidenced by an indorsement on the undertaking, or an order entered approving the bond. Such order, in the present case, was recorded on October 7, 1922. In other words, the law does not permit the matter of the justification of the sureties upon an undertaking on appeal to be left for determination by proof dehors the record, which would not only endanger the rights of the parties, but tend to cause confusion and misunderstanding.
In Cantrall v. Sterling Mining Co., 61 Or. 516 (122 Pac. 42), the justification of the surety was in writing waived by counsel for plaintiffs upon a certain date, and an entry thereof made in the record. Such waiver was held to be tantamount to a justification. The waiver of counsel mentioned in the present case would apply more particularly to the surety who was not examined, and would not obviate the necessity of making some record of the allowance of the under taking to serve as an indorsement of the allowance of the undertaking by the trial judge.
The justification of the surety having been completed and the undertaking on appeal approved on October 7, 1922, the transcript was filed within the statutory period, as extended by orders duly made by the trial court.
The motion to dismiss the appeal is denied as in our former order.
Motion to Dismiss Denied.
. Right to rely on representations of obvious facts, or facts of which the defrauded: party has knowledge, see note in 37 L. R. A. 595.
. What amounts to false representation of existing fact, see note in 1 Ann. Cas. 980.