Title: Sperle v. Weigel
Citation: 130 N.W.2d 315
Docket Number: 8140
State: north-dakota
Issuer: north-dakota Supreme Court
Date: September 24, 1964

130 N.W.2d 315 (1964) Kate SPERLE, Plaintiff and Appellant, v. Joe B. WEIGEL and Elizabeth Weigel, Defendants and Respondents. No. 8140. Supreme Court of North Dakota. September 24, 1964. *316 Rausch &amp; Chapman, Bismarck, for plaintiff and appellant. Anderson &amp; Wolf, Bismarck, for defendants and respondents. ERICKSTAD, Judge. The plaintiff, Kate Sperle, appeals from a judgment of the District Court of Burleigh County dismissing her complaint. She asks for a trial de novo. In her complaint she sought either the rescission of a sale and the return of her purchase money or damages because of alleged fraudulent representations by the Weigels which induced her to buy a four-unit apartment building. Miss Sperle, a spinster fifty-one years of age, had spent most of her life on a farm near Napoleon, North Dakota, caring for her brothers and sisters after the death of their mother. In recent years she had been employed in domestic service by an "old people's home" in the City of Bismarck. At the time of the law suit she was caring for an elderly woman in Bismarck. She has a fifth grade education. As German was the language customarily spoken in her home, she has difficulty reading, speaking, and understanding the English language. She had had no business experience and had very little knowledge of city ordinances. Having heard that the Weigels wished to sell their apartment building in Bismarck, she telephoned to inquire and was invited by Mrs. Weigel to their home to talk about it. Accordingly, Miss Sperle went to the Weigels' house on November 11, 1962. The following is a portion of her testimony concerning what then transpired: The Weigels were asking $12,000 for the building but agreed to sell it to Miss Sperle for $11,600, when she made this counter-offer. A Bismarck realtor testified that he examined the building on April 19, 1963, and that in his opinion it was worth only $6,600. Concerning representations by the Weigels regarding the condition of the building, Miss Sperle testified as follows: Although no contract was drawn or executed on that date, Miss Sperle left a check for $10, so that the Weigels would hold the place for her. On December 13, 1962, the Weigels executed a deed conveying the premises to Miss Sperle. It was recorded in the office of the Register of Deeds for Burleigh County on December 17, 1962. A mortgage on the premises for $7,000 was executed on the date of the deed to secure the balance of the purchase price. The sum paid by Miss Sperle to the date of the law suit is $6,171, which is the amount of money she requests be returned to her in exchange for a deed to the premises. On December 27, 1962, she received a complaint from one of the tenants about a leakage of gas, which, it developed, was from an unvented gas stove. This stove was disconnected by a representative of the gas company. Shortly thereafter the City inspected the premises and on January 7, 1963, sent Miss Sperle the following letter: Following receipt of this letter, Miss Sperle discussed the matter with the Weigels. Estimates were obtained, indicating that the building could be rewired for $700. It was orally agreed that this cost should be shared equally and that Miss Sperle would pay for repairing the plumbing, which at that time involved only the repair of a constantly flowing toilet. Following this agreement, Miss Sperle issued her check for $1,371. Shortly thereafter the plumbing developed more difficulties, which, it was estimated, could be repaired for $500. When the Weigels would not share in this cost, Miss Sperle stopped payment on her check for $1,371. This resulted in a telephone call from Mr. Weigel, telling her that if she didn't make the check good, he would cause trouble. Miss Sperle then reissued her check and again attempted to discuss the plumbing matter with the Weigels. When they refused to discuss it, she informed them that she would obtain a lawyer and sue them. This action is the result thereof. In Schaff v. Kennelly, N.D., 61 N.W.2d 538, this court said: Here the plaintiff asks an adjudication or decree rescinding the sale or, in the alternative, seeks damages. In her suit in equity she is governed by Section 32-04-21, N.D.C.C., providing for rescission by adjudication of the court of equity, rather than by Section 9-09-04, providing for rescission in law. Our Legislature has defined actual and constructive fraud as follows: As Miss Sperle contends that she was induced by fraudulent representations to purchase the apartment building and as fraud is a basis for rescission in equity under Subsection 1 of Section 9-09-02, N.D.C.C., we shall review the representations alleged to be fraudulent. The first alleged misrepresentation is that the buyer would be able to pay the entire purchase price in six years from the rent. The second is that the four units would produce a monthly rental income of $210. Although the premises may not be used as an apartment building until the repairs ordered by the City are made, there is nothing in the record to disclose that the building at the time of the sale was not producing a monthly rental income of $210. There is no evidence to indicate that the premises could not have been paid for in six years had all the apartments been rented for the full period, nor is there any evidence showing that the apartments had not been regularly rented while owned by the *320 Weigels. The record is also devoid of anything indicating that the sellers had any reason to believe that the buyer would not be able to continue to rent all of the apartments. Ordinarily, misrepresentations amounting to fraud which will avoid a contract must relate to past or present facts, and cannot consist of unfulfilled promises or predictions with respect to future events, especially where intent to deceive is absent. 17 C.J.S. Contracts § 157 (1963). One of the essential elements of fraud is that there be a false representation of a material fact which either exists in the present or has existed in the past, and a mere expression of an opinion in the nature of a prophecy as to the happening or nonhappening of a future event is not actionable. Leece v. Griffin, 150 Colo. 132, 371 P.2d 264. The statement that the building was a good, four-unit rental building is merely an expression of opinion. In discussing the effect of similar words, the Supreme Court of Arizona said: As we view the evidence, no representation was made as to the value of the premises. The sellers merely asked a certain price for the premises. The mere asking of a certain price for a piece of property is not a representation of its value. Boettcher v. Goethe, 165 Neb. 363, 85 N.W.2d 884, citing 37 C.J.S. Fraud § 57 c; Nathan v. McKernan, 170 Neb. 1, 101 N.W.2d 756. In the instant case the buyer argues that because of the great disparity in education, in ability to use the English language, in intelligence, and in business experience between the buyer and the sellers, and because the buyer and the sellers were in a confidential or fiduciary relationship, the representations were accepted as facts and not as opinions, so that the buyer relied completely thereon and was induced thereby to buy the premises, to her prejudice. In this connection the record fails to disclose the extent of the education, the ability to use the English language, the intelligence, and the business experience of the sellers, and thus does not show a disparity. It also fails to support the contention that a fiduciary or confidential relationship existed. The only testimony in this regard was the buyer's testimony that she and Mrs. Weigel are cousins, that she has known Mrs. Weigel all her life, and that she believed her. The mere fact that Mrs. Weigel and the buyer are cousins is insufficient in itself to create a fiduciary or confidential relationship. In this connection the Supreme Court of Illinois, in a 1950 decision, had this to say: A decision rendered by the Supreme Court of Iowa in 1951 is to the same effect. Wagner v. Wagner, 242 Iowa 480, 45 N.W.2d 508. Although it is apparent that Miss Sperle purchased an old building in need of considerable repair, we do not find that the representations made by the sellers are fraudulent representations entitling the purchaser to rescind the sale and recover the money paid on the purchase price or to receive money damages. For the reasons stated herein the judgment of the district court is affirmed. MORRIS, C. J., and BURKE, TEIGEN and STRUTZ, JJ., concur.