DAILY CAPITAL JOCRVU SALEM, OREGOX, MOXDAT, OCTOBER 19, 1011. FACT THREE! OREGON SUPREME COURT DECISIONS Fill Text PmblUhed bj Coirtesy t F. A. Turner, Reporter of the 8npreme Coirt Cannon t. Mllner, Multnomah County. Decided October 3, 1911. M. P. Cannon, appellant, v. Alice E. Mllner, respondent. Appeal from the circuit court for Multnomah county. Hon. John B. Cleland, judge. Ar gued and submitted September .20. 1911- Harry Yanckwlch and R. Sleight for appellant. Flegel & Rey nolds and John F. Logan for respond ent. Moore, J. Affirmed. This Is a suit to rescind a contract, the execution of which is alleged to have been induced by fraud; to en join the prosecution of any action based on the terms of the agreement; to direct a reimbursement of the money paid on account thereof and to recover damages. The facta are that on September 27, 19D9, the plaintiff, M. P. Cannon entered into a contract with the defendant, Alice E. Mllner, who then kept a lodging house in Portland, stipulating that in consid eration of the payment of $3,000, of which sum $1,300 was received, she would sell and transfer to him an undivided half of all the furniture, etc, in the house, attaching an in ventory thereof to the writing, and also to assign to him an undivided half interest in a lease of the prem ises. The remainder of the purchase price was to be paid In installments of $100 each, commencing October 1, 1909, and maturing monthly thereaf ter, and upon payment of the entire sum the defendant would perform her part of the agreement, but prior to the discharge of the debt, she was to retain the title and estate as se curity for such payment. The par ties were jointly to conduct the busi ness in which the defendant had been engaged each contributing one-half of the expenses incident fhereto and receiving monthly an equal share of the net profits, and faithfully to labor to promote the enterprise, but neither was to receive any compensation therefore except such avails. The contract contained a clause as fol lows: "Cannon hereby agrees to fur nish a surety company bond In the sum of two thousand dollars ($2, 000.00) for the payment by him of his portion of the rent of the said premises, or to furnish other satis factory security therefor, and this agreement shall not be effective un til such security has been provided." Pursuant to the contract, plaintiff on October 1, 1909, paid $100. the first installment of the remainder of the purchase price and at the same time also advanced $225 on account of rent of the buildlne for that month. The money received from the busi ness for October, 1909, was $966.11, from which was paid $774.20, as the expenses of conducting the house, leaving $191.91, to one-half of which, or $95.95 plaintiff was entitled. This suit was thereafter instituted, the plaintiff alleging in effect that the defendant, for the purpose of in ducing him to enter into the agree ment, falsely and fraudulently rep- resented to him that she had an ab- the remainder, after paying all dis bursements, was only $191.91, Mrs. Mllner denied that she made such representations, saying that she In formed plaintiff that no books had been kept wherein were noted the re ceipts or payments, but that all dis bursements were evidenced by checks drawn on a bank, the stubs of which were retained; that in order solute right to transfer an undivided t0 dlsclose the "penses 'tne. D"sl- half interest in and to the leasehold ness 8he showed tnese 8tubs to hlu! estate In the premises of which she and ne exatulned them for 8everal was the sole owner; that she was hours- . . lawfully empowered to assign her In-1 Mr8' IsabeU Kra8ner andher4 8,.V terest or to sublet the same or any ter- chrissle Browtt- severally testl- part thereof: that for the purpose of fled that Mrs' Mlln.er "presented to further persuading plaintiff to ac- her that the n( lncome fr01? th,6. cede to the terms of the contract the house wa8 30 a nl0?,th- " defendant falsely and fraudulently the testlmo, tnese w'tne88e8 represented tn hlm ,w .h-iX could be considered as corroborative ATTENTION LAWYERS We publish legal notices aa required by law, furnishing affidavit and proof of pub. llcatlon. Fine Brief Work Is our specialty. Let m figure with you on your next case. Capital Journal SALEM, OREGON gross receipts from the building, for some time prior, had been above $900 while the net income was $400; that relying upon such representations! and having no means of ascertaining their falsify, plaintiff became a party to the contract, in complying with the j terms of which he paid out $1625 as hereinbefore stated and also the sum of $300 for additional furniture for the building; that defendant had no right to assign the lease without first obtaining the written consent of the lessors which she never secured nor was she the sole owner of the lease; that the net earnings of the business were not as she reprsented and did not exceed $200 a month as she well knew; that plaintiff, relying on such representations, performed labor and services at the building to the value of $700 and was otherwise damaged in the sum of $2,000; that unless re strained defendant will commence actions to recover the monthly in stallments of $100 each as they sev erally mature; and that plaintiff has no plain speedy or adequate remedy at law. The answer denies the material averments of th complaint and by way of cross bill alleges that at all times Btated therein the defendant was the sole owner of all the furni ture mentioned and the beneficial owner and holder of (lie lease and at all times had been id then was able, ready and willing to keep her part of the contract upon performance of the other part by plaintiff; that he has never furnished any bond as re quired, and that defendant has fully complied with all the terms of the greement assumed by her. The equitable Hen on the personal prop erty is then set forth and a strict foreclosure thereof sought The reply having put In Issue the allegations of new matter In the an swer, the cause was tried, resulting in a decree as prayed for in the an swer and plaintiff appeals. Moore, J. The lease under which the defendant retained possession of the building was executed by Leo. Friede and N. D. Simon, the owners of the premises, to T. J. Mllner and his wife, the defendant herein, where by the lessees were to retain the property for a term of four years from December 1, 1906, upon pay ment on the first of each month of $350 for the first and second years and $400 a month for the third and fourth years. An option was grant ed to continue the term for another year -at $450 a month. The demise stipulated that the lease should not be assigned and the lessees cove nanted to" execute a mortgage upon certain real property which they owned In Multnomah County as se curity for the payment of the rent reserved. In the contract executed by plain tiff it is stated that the lease of the premises was then owned by the de fendant. The attorney who prepared i the contract for execution testified that without being informed in rela tion to the matter and supposing that Mrs. Mllner was the sole lessee of the premises he made a written statement to that effect in the agree ment. This declaration? was not In tentionally false and plaintiff did not sustain any damage by reason there of, for the testimony shows that though the lease prohibited an as signment of any interest therein, the lessors were at all times ready and willing to consent to a transfer to him of the defendant's estate or any part thereof when he furnished a satisfactory undertaking, as agreed upon, that he would pay the rent as It matured, which bond he never ob tained. The plaintiff testified that Mrs. Mllner represented to him, when he was negotiating with her .for an In terest in the property, that the net proceeds of the business was $300 or $400 a month. When the first month ly statement rendered showed that of plaintiff's sworn declarations, their affirmations are rendered value less by evidence of the plaintiff's In fluence over them and by their ap parent interest in his affairs, without further commenting upon their tes timony or adverting to the motives that seemed to prompt it, we are sat isfied that In this case their evidence Is unworthy of belief. When plaintiff, as a witness, was cross examined, the foundation for impeaching testimony was properly laid and he thereupon dented that he made the statements Imputed to him. To contradict his testimony In this particular, A. F. Flegel, who pre pared the contract in question, testi fied that while the parties were ne gotiating the plaintiff called upon him, saying: "I talked with Mr. Can non about the details of the agree ment and I got practically all of the information from him from which the agreement was drawn. I remem ber very particularly about talking to him about the profits that could be made from running the house and Mr. Cannot said that Mrs. Mllner was not making anything out of the place; that she was not running It right and didn't know how to run It; and he would make a good thing out of it he was satisfied, and It was good property." It will be seen that Flegel's sworn declarations do not fix the sum of money which Cannon regarded as a sufficient monthly income to be de rived from a careful management of the business. The plaintiff may have thought that $300 a month was not adequate. Though such conclusion Is possible, we believe a general view of the whole testimony of the plain tiff and his witnesses does not carry that degree of conviction that the testimony of the defendant and her witnesses affords. It appears that Cannon paid $2o more than his share of the rent due for October, 1909. Some controversy exists as to whether or not such ex cess was given In lieu of furnishing the bond required. However this may be, it is unimportant, for the payment having been made after the contract was executed cannot Invali date the original agreement. That payment was a proper matter to be considered and the trial court de creed a credit therefor In case the plaintiff paid the remainder of the purchase price, his share of the rent and of the expenses within the time limited. We conclude the decree was cor rect, but since Its enforcement has been delayed by the appeal, the plain tiff will be allowed 30 days after the decree herein becomes finpJ, to com- dIv with the terms Imposed, and if he tenders Into court the remainder of the purchase price and interest, one-half of the monthly rent and In terest thereon and also the compen sation of a person who would have performed the service, he could have rendered and was required to furnish, he will be entitled to an ac counting as a partner In the business and become the owner of an undi vided half of the personal property involved- including an assignment of an interest in the lease. In case he does not make such tender within the time prescribed, the defendant's equitable Hen upon such property will be strictly foreclosed and plain tiff will be barred of all right, title or interest therein or thereto. It follows that the decree should be affirmed and It Is so ordered o Lady. 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