Appeal from Special Term, Erie County.
Action by Catherine Adams against Alexander J. Gillig and others. From a judgment for plaintiff, defendants appeal. Affirmed.
[115 N.Y.S. 1000] Riordan & Bott and Horace McGuire, for appellants.
James W. Persons, Adelbert Moot, and Helen Z. M. Rogers, for respondent.
Argued before McLENNAN, P. J., and SPRING, WILLIAMS, KRUSE, and ROBSON, JJ.
The judgment should be affirmed, with costs. The action was brought to set aside a contract and deed of real property, or, in the alternative, to reform said contract and deed so as to limit the building upon the land to dwelling houses, and to procure the issue of temporary and permanent orders restraining the building of other than dwelling houses upon the property sold.
It is not contended that the plaintiff, under the evidence in the case, was entitled to any reformation of the contract or deed. The attention of both parties was called to the question, before the contract and deed were prepared, as to what use the defendant Gillig was to make of the property. Neither party asked to have any restrictive clause inserted in the papers. They knew there was no such clause therein when the papers were executed. They did not intend there should be. The referee did not find that the plaintiff was entitled to a reformation of the contract or deed. The only relief that plaintiff was entitled to, if any, was that which the referee awarded, setting aside the contract and deed as having been procured by fraud practiced upon the plaintiff by the defendant Gillig, and the only fraud found by the referee was that the defendant Gillig represented to the plaintiff that he intended to use the property for dwelling houses, and for no other purpose, when as a matter of fact he had all the time preconceived intent to construct an automobile garage thereon. It was further found that the statement of his then existing intent was false, was known to him to be false, was made with intent to deceive, was relied upon by plaintiff as true, and she was deceived thereby, and was induced to make the contract and deed, and was injured and damaged thereby. So far as these findings dealt with the facts, we see no reason why they are not sustained by the evidence, or why we should hold they were contrary to the evidence. The defendant's Gillig's real design was quite apparent from what he did. The contract was made May 19, 1908. The deed was given June 2, 1908. On the same day (June 2, 1908) he wrote to the motor company to secure an agency for the Cadilac motor car. On the next day (June 3, 1908) he instructed an architect to prepare plans and specifications for the garage. On June 8, 1908, the plans and specifications were [115 N.Y.S. 1001] furnished him. On June 15, 1908, he made a contract for the erection of the garage on the property at an expense of $11,757, and on June 17, 1908, the construction was commenced. In view of these established facts, there could be little doubt as to his intention when he made the contract and deed. That he made the representation claimed is equally apparent. He hardly denies it. The plaintiff first learned June 19, 1908 that the construction of the garage had been commenced. Without any unnecessary delay she went to the defendant Gillig and offered to return to him the consideration paid for the property, $5,425, to pay all expenses he had incurred up to that time, and to procure him another site for his garage, if he would reconvey the property he had purchased of her. He refused to do this, and this action was soon commenced. The contractors were joined as parties defendant with Gillig, and a temporary injunction was secured restraining the continuance of the work on the garage. No further work has been done thereon.
The building of a garage on the property would be a great damage to plaintiff's other property adjoining that sold. The property was in one of the best residence localities in the city of Buffalo, and the referee very properly found that the false representation was designed to and did deceive the plaintiff and induce her to make the contract and deed, and that she was injured thereby. The only question really involved in this appeal is one of law, as to whether the representation was one upon which fraud could be predicated, that he intended to use the property to build dwelling houses on, and for no other purpose. The claim is that the statement was not in the nature of a promise, nor an expectation merely, but of a then present existing intent; and peculiar force is given to this claim by the very clear and satisfactory proof that Gillig then had an existing intent and purpose to construct a garage on the property, and made the representation for the purpose of cheating and defrauding her, and inducing her to make the contract and deed, which she would not have done, if she had known the real truth. It is not sought to upheld the judgment upon the theory that the statement made was a promise as to the future use to be made of the premises, and therefore the cases referred to by the appellants' counsel, where there was a promise merely, need not be very carefully considered.
Appellants' counsel cites a line of cases apparently holding that a mere promise to do anything in the future will not, when violated, be a basis for the allegation of fraud, even if there was an intention at the time the promise was made to violate the same. Respondent's counsel cites another line of cases, however, apparently holding a contrary doctrine. These cases are sought to be distinguished by opposing counsel upon one ground and another. We do not desire to enter upon any analysis of these cases. Our judgment is that the law in this state is that fraud cannot be founded solely upon a promise not performed, even if the promisor never intended to fulfill the same. See Kley v. Healy, 127 N.Y. 561, 28 N.E. 593.
The question here is slightly different, however. This statement was in no sense a promise. It was a statement of a present existing [115 N.Y.S. 1002] intent, and we see no reason why it was not as much an existing fact as any other fact that could be made the basis of a charge of fraud. The purpose of the statement was to deceive and defraud, and it accomplished such purpose. There is no decision in this state bearing upon this precise point, but it is reasonable to hold the defendant liable for this fraud.
The result in this case is in accord with justice, and we think the judgment should be affirmed.
All concur, except McLENNAN, P. J., and ROBSON, J., who dissent.
MCLENNAN, P. J. (dissenting).
The material findings of fact are supported by evidence, and are, in substance, that in May, 1908, the defendant entered into negotiations with plaintiff's agents looking to the purchase of some real property situate in a residential portion of the city of Buffalo, in which locality were other lands owned by the plaintiff; that the purchase price was agreed upon, and during the negotiations the defendant was asked for what purpose he desired to use the land which he was seeking to purchase, and in reply he stated, in substance, that he intended to use the property only for the " purpose of building residences thereon," and that statement or declaration was communicated to the plaintiff; that said statement of intention so made by the defendant was false and fraudulent, and made with intent to deceive the plaintiff; that she, however, believed and relied upon the same, and entered into a written contract with the defendant for the sale of the premises to him the plaintiff agreeing, on or before May 28, 1908, to furnish to the defendant a " full tax and title search, *** showing a good and marketable title, and showing the premises free and clear of all liens and incumbrances," except a certain mortgage, from the lien of which she agreed these premises would be released at the date of the consummation of this transaction. The defendant agreed to pay $100 down, which he did, and the balance; $5,425, on the 8th day of June, 1908, at which time it was agreed a warranty deed of the premises should be delivered to him by the plaintiff. Such contract contained no restrictive clause or covenant. Thereafter, and on June 2, 1908, the plaintiff, through her agents, duly ...