Opinion ID: 1195916
Heading Depth: 1
Heading Rank: 2

Heading: Motel Earnings

Text: Another fraudulent representation claimed by plaintiffs, according to the issues as settled at pretrial conference, is the following: That the motel had a gross income of $12,000.00 to $14,000.00 per year and netted $10,000.00 to $11,000.00 per year having approximately $3,000.00 of expenses; whereas in truth and in fact, the motel property had a gross income of less than $10,000.00 per year and netted between $3,000.00 and $4,000.00 per year. In support of their claim, plaintiffs offered in evidence the income tax returns of defendants for the years 1955 and 1956. Plaintiffs testified, however, that prior to completing the purchase, the motel register had been turned over to them for examination. When the register was returned, the Davises informed the Schiesses there was a difference between what had been said and what the motel register showed. At this point, it was explained by Mrs. Schiess, according to testimony of Mrs. Davis, that the motel register did not represent the entire income, and that some of the earnings were not entered in the register or reported on tax returns. Mrs. Davis further testified a request was made to see the books, but Mr. Schiess would not show them. It seems clear, then, from the testimony of the Davises themselves that they knew neither the register nor income tax returns reflected all earnings of the motel. Consequently, the tax returns, in and of themselves, did not prove the falsity of Schiess' representations. Admittedly, plaintiffs examined the motel, station and cafe extensively with regard to the business being done prior to purchasing the property. Also, it is undisputed that plaintiffs lived about three doors north of the motel for 14 years, and for some 25 years Mr. Davis operated an implement business diagonally across the street and approximately 150 yards from the motel. It becomes apparent from this set of circumstances  where the Davises knew the motel register and tax returns showed less income than was claimed; where the Schiesses were not willing to show their books; and where the Davises themselves personally investigated and observed the volume of business being done  that purchasers relied upon their own observations and knowledge of the business being done, and not upon representations which they claim the Schiesses made. Therefore, not only did plaintiffs fail to offer substantial evidence of false representations pertaining to earnings, but their proofs tended to refute any reasonable presumption of reliance upon such representations. Counsel for appellees has deemed it necessary to discuss matters which apparently were in controversy during the trial, such as the condition of the roof, the condition of plumbing and of a sign and of linens, and whether the motel was an all-weather motel. We find none of these matters raised in the points listed by appellants for our consideration. In the absence of such matters being urged by appellants on appeal, we will not discuss them.