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HENRY F. WESSEL v. JOHN GIGRICH

Minnesota Supreme Court1909-01-15No. Nos. 15,852—(64)
106 Minn. 467

Summary

Holding. The judgment notwithstanding the verdict is reversed, and the case is remanded with leave for defendant to apply for a new trial, on the ground that the absence of evidence as to the lease's value does not provide sufficient basis to set aside a jury verdict for fraud when the evidence of fraudulent misrepresentation was ample.

Plaintiff sued defendant for fraud, alleging that defendant falsely represented he would contribute half the purchase price ($1,000) toward acquiring a mineral lease worth $2,000, when defendant actually intended to cheat plaintiff into paying the entire amount. Plaintiff paid $1,000 to defendant in reliance on these representations. After the lease was obtained, plaintiff discovered the deception and demanded repayment. At trial, the jury found for plaintiff and awarded $485 in damages, but the trial court entered judgment notwithstanding the verdict, reasoning that plaintiff failed to prove the lease's actual value and therefore could not establish measurable damages.

Plaintiff appealed, arguing that his real claim should be characterized as one for recovery of an unjust enrichment or breach of agency duty (defendant keeping $500 that should have been refunded), rather than a fraud damages claim requiring valuation of the lease. The appellate court acknowledged this theory had not been advanced at trial but found it should not be foreclosed given the parties' confidential relationship. The court held that the absence of evidence regarding the lease's value was insufficient to justify overturning the jury verdict, particularly since the missing evidence might be supplied on retrial.

Summary generated by law.co from the public-domain opinion. The opinion text itself is public domain.

Key issues

  • Whether damages for fraud can be assessed absent evidence of the actual value of property acquired through misrepresentation
  • Whether a jury verdict should be overturned on motion for judgment notwithstanding when evidence of damages is incomplete but misrepresentation is proven
  • The proper characterization of a claim involving fraudulent inducement and potential unjust enrichment within an agency or confidential relationship

Procedural posture

Plaintiff appealed from an order granting defendant's motion for judgment notwithstanding the verdict following a jury award of $485 in a fraud action.

Authorities cited

No cited authorities resolved to law.co cases yet.

Opinion

majority opinion

LEWIS, J.

The complaint states that defendant represented to plaintiff that one Crowley was the owner of a certain mineral lease, and that Crowley was willing to sell the same for the sum of $2,000; that defendant, with the intent of cheating and defrauding plaintiff, represented that, if plaintiff would furnish $1,000, defendant would pay the other $1,-000, and that they would thus purchase the lease from Crowley and own it jointly — each an undivided one-half interest; that, relying on these representations, plaintiff paid defendant the sum of $1,000, and thereafter Crowley duly assigned the lease to appellant for the express consideration of $2,000, and subsequently plaintiff assigned to defendant a one-half interest therein; that in fact plaintiff purchased the entire mineral lease from Crowley for $1,000; “that said defendant promised and agreed to pay to said Crowley one-half of the purchase price for an assignment of said lease by said Crowley, and then and there intended to cheat and defraud said plaintiff, by making said plaintiff believe that he (said defendant) was paying $2,000 therefor, $1,-000 of the money of said plaintiff and $1,000 of the money of said defendant; and that in point of fact said plaintiff has paid the entire purchase price for said mineral lease and for an assignment thereof from said Crowley, when under said agreement with said defendant he was to pay one-half thereof.” There is also an allegation that, upon the discovery of the fraud, plaintiff made a demand upon defendant for a refund of the money of which he had been wrongfully deprived.

The trial court construed the complaint to state a cause of action for the recovery of damages for deceit, and submitted the cause to the jury upon that theory. The jury returned a verdict for plaintiff for $485, whereupon defendant moved for judgment notwithstanding the verdict, or for a new trial. The court denied the motion for a new trial, but granted the motion for judgment notwithstanding, upon the ground that there was no evidence to prove that plaintiff was damaged, conceding the evidence was ample to sustain the charge that he had been induced to purchase upon false representations. The court referred to the case of Stickney v. Jordan, 47 Minn. 262, 264, 49 N. W. 980, for the rule of damages, viz., the difference between what appellant was induced to part with and what he got, and held that there was no evidence that the lease was not worth the amount paid for it, and hence there was no foundation upon which the damages could he estimated. Plaintiff claims this order should be reversed upon the ground that the real cause of action upon which he relies is not one of deceit, but is one to recover the amount which defendant made out of the transaction, viz., the sum of $450, with interest, while acting as the representative, or agent, of plaintiff; that is to say, plaintiff paid defendant the sum of $1,000 upon the supposition that one-half interest in the lease would cost that amount, when in fact it was only $500; hence respondent must account for the balance of the money.

The record shows that this position was not taken in the court below. The action was tried throughout upon the theory of recovering damages for the fraud practiced, and it is clear that the trial court so considered it, and consequently submitted the case to the jury to assess damages accordingly, and the order granting the motion for judgment notwithstanding was entered upon that understanding of the case. Under such circumstances, we are not called upon at this time to determine whether or not the complaint states facts sufficient to permit a recovery upon the ground of agency now urged. But, considering the confidential relation evidently existing between the parties, the plaintiff should not be foreclosed, if there is any probability that the missing evidence may be supplied upon a ne\y trial. Cruikshank v. St. Paul F. & M. Ins. Co., 75 Minn. 266, 77 N. W. 958. Granting, therefore, that the evidence is silent as to the value of the mineral lease, and that there are not sufficient data upon which to estimate damages, we do not think the failure to produce that evidence was sufficientground upon which to order judgment notwithstanding the verdict.

Order reversed, with leave to defendant to apply for a new trial. Kreatz v. St. Cloud School District, 79 Minn. 14, 81 N. W. 533.