SHEARER ET AL v. COOPER

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District Court of Appeal, Fourth District, California.

SHEARER ET AL. v. COOPER.

Civ. 2837.

Decided: July 24, 1942

Jerry Geisler, of Los Angeles, Gray, Cary, Ames & Driscoll, J. G. Driscoll, Jr., and John M. Cranston, all of San Diego, for appellant. Gang & Kopp, of Los Angeles, for respondents.

This is an appeal from a judgment against Charles E. Cooper awarding plaintiffs damages in the sum of $19,650 for fraud in the sale of 550 acres of land in what was originally known as the Monserate Rancho in the Bonsall District in San Diego County.

Cooper purchased the Monserate Rancho from the Huntington Land and Improvement Company early in 1932. He received various maps and drawings from that company upon some of which various characters and areas of the soils were described. His use of reproductions from some of these maps in the sale of the land to plaintiffs, as well as oral and written representations made by him and by David H. Backus, his agent, form the basis of the fraudulent representations charged to him.

Before attempting a summary of the facts of the case we should dispose of one contention made by Cooper.

The case was originally tried before the Hon. Frank J. Macomber, who died after the conclusion of the trial and before the findings and conclusions were signed. The court reporter also died and only the portions of the record that had been transcribed during the trial were available at the second trial.

The deposition of Douglas G. Shearer had been taken and an attorney who had participated in the former trial testified at considerable length concerning Shearer's testimony at that trial, which, according to the testimony of this witness, varied materially from his evidence at the second trial. The deposition also was used to impeach Shearer.

Counsel for Cooper have stressed these conflicts and the impeaching evidence at considerable length in their briefs. These arguments may have been and probably were properly urged in the trial court as they went to the credibility of Shearer as a witness and the weight to be given his testimony.

A trial judge may accept part of the testimony of a witness as true and reject other portions of it. He is the judge of the weight and sufficiency of the evidence and the credibility of the witnesses. If he accepted substantial evidence supporting the findings and judgment as true and rejected other evidence conflicting with it, the question of the sufficiency of the evidence to support the findings and judgment is closed as far as the appellate court is concerned unless we may conclude that the evidence is inherently improbable or that the witnesses are so untruthful as to be unworthy of belief. After studying the record and searching the many exhibits we cannot reach either conclusion in this case. We, therefore, will confine our statement of facts to a summary of the evidence supporting the findings and judgment and will disregard evidence sharply conflicting with it except insofar as that evidence may be necessary to understand certain arguments made by Cooper.

Douglas G. Shearer and Ann Cunningham Shearer are husband and wife. Mr. Shearer conducted the negotiations for the purchase of the property. Mrs. Shearer was a necessary party plaintiff because she was one of the purchasers. Where practicable we will refer to Douglas G. Shearer as the plaintiff, and to Charles E. Cooper as the defendant.

Early in 1934, and prior thereto, plaintiff desired to acquire income ranch property upon which he could live after he had retired from his employment as chief recording engineer of one of the large moving picture producing companies. Prior to March, 1934, he had inspected several ranch properties in various parts of California, none of which proved satisfactory. Some of them were shown to him by Backus.

Early in 1934, Backus contacted defendant who desired to sell about 1,250 acres of the Monserate Rancho which he had renamed the “Rancho San Luis Rey.” Backus received a letter from defendant and a map which purported to show the property to be sold and the various characters of soils on it which were indicated in different colors. On the bottom of this map, opposite colored crayon markings which corresponded to the colors on the map, the following legend appears:

“ESTIMATES

ALFALFA NOW IN –– 160 ac

ALFALFA LAND –– 300

CULTIVATABLE LAND––260

PASTURE LAND –– 260

PIPE LINES NOW IN

PIPE LINES PROPOSED

TREES AND BRUSH –– 270

WATERWAYS AND LAKE”

The Monserate Rancho was an old Spanish Grant which had not been surveyed by the United States. Its boundaries were not marked on the ground and very apparently were not known to defendant. But one old survey stake was found on the land subsequently sold to Mr. and Mrs. Shearer. It was located at a point marked “M3” on plaintiffs' exhibit 2 (the colored map above referred to) and is about a quarter of a mile west of the easterly boundary line of the property sold to the Shearers.

Backus contacted Shearer shortly after March 10, 1934, showed him a letter from Cooper describing the property and the colored map and had several conferences with him in reference to a prospective sale. The two went to defendant's home on the property about May 13, 1934, where they interviewed Cooper who showed them over a portion of the property. Cooper drove them across the San Luis Rey River over a dirt road and plaintiff observed two wooden culverts in this road as it crossed the river. Defendant told him that since the construction of the Henshaw Dam on the upper reaches of the river a number of years before, the danger of the river flooding during rainy seasons had been removed; that occasionally during heavy rains the culverts would be washed out and the road thereby closed for a few days at a time; that the culverts could be hauled back in place and reset; that other than this inconvenience there was no danger from flood waters.

Defendant took plaintiff to a point an undisclosed distance east of point “M3” and told him that the east boundary of the property was easterly from where they stood. He pointed to some pine trees on a hill about a mile southwesterly from them and said those pine trees marked the southeast corner of the property. This was subsequently found to be an error as the pine trees were not on the property owned by Cooper. The southeast corner of the property was one–quarter of a mile east of the southeast corner of the forty–acre tract on which the pine trees stood.

Defendant drove plaintiff southerly over a dirt road and passed two alfalfa fields which we will designate as the north alfalfa field and the south alfalfa field. Shearer described the growing alfalfa as “lush.” The two fields were separated by what we will call the Keys Canyon Wash. It descended in a northwesterly direction from the hills or mountains lying to the east, and flowed into the San Luis Rey River. The wash was then dry and defendant assured plaintiff that it was never more than a little creek, was not dangerous, was free from floods and could do no damage to the land. Defendant also pointed out a pumping plant and well from which water was conveyed through a pipe line to irrigate the two alfalfa fields. Natural monuments were pointed out by defendant as on the exterior boundaries of the 1,250 acre tract.

A short time afterwards Backus took Mrs. Shearer to the property. She discovered an old eight–room adobe dwelling on high ground east of the San Luis Rey River and near the southern boundary of the 1,250 acres of land. The house interested her. She was unwilling to purchase any part of the property unless she could acquire this building.

Negotiatoins for the sale continued over a period of two years. Many conferences were held between plaintiff and Backus and some with defendant. Plaintiff explained that he would not be interested in the property unless it would return a net income to him. He inquired carefully about the number of tons of alfalfa produced annually, its selling price, the cost of production and the power bills for the operation of the pumping plant. He obtained these figures from defendant and no complaint is made of their accuracy. He was positively informed both in writing and verbally that there were 160 acres of growing alfalfa in the two fields.

Plaintiff testified that he made seven or eight trips to the property and went over portions of it each time. Some of defendant's witnesses placed the number of these inspections as high as twenty–two. He flew over the property and caused aeroplane photographs to be made. These show most of the 1,250 acres, as well as property to the north on which stood the home and race track of defendant. Plaintiff examined these photographs through an instrument that brought the topography of the ground into relief to some extent. Light streaks which proved to be sand appear in both alfalfa fields. They are quite apparent in the photograph of the south field. Plaintiff cut these pictures up and pasted them together so that he had two continuous pictures of the land. He gave one to defendant.

Various propositions were made to plaintiff for the sale to him of parts of the 1,250 acres and a long term lease on parts of the balance. One proposition was for the sale of 430 acres which was shown within the purple crayon lines drawn on a colored reproduction of the colored portions of plaintiffs' exhibit 2. The acreage within the purple lines included both alfalfa fields and a sizable tract of land designated as (potential) alfalfa land lying west of the north alfalfa field and northwesterly of the south alfalfa field and the Keys Canyon Wash. The original map could not be produced so Backus drew purple lines on plaintiffs' exhibit 38 which he said corresponded to the purple lines on the similar map furnished him by defendant which he gave to plaintiff. After the sale was completed this map was returned to Backus who believed he had given it to defendant.

This offer to sell the 430 acres did not include the adobe house and was not acceptable and the parties finally agreed to the addition of 120 acres (which included the adobe) lying north of the south boundary line of the 1,250 acres and joining the 430 acres on the west, making a total of 550 acres. This offer was finally accepted and the property sold to plaintiffs for $61,500, payable, $15,000 in cash and the balance evidenced by a promissory note secured by a deed of trust.

The property actually purchased by plaintiffs is shown on plaintiffs' exhibit 16 which is a colored map identical in coloring with plaintiffs' exhibit 38 and plaintiffs' exhibit 2. There is an unexplained difference in the boundaries of the 430 acres which are drawn on plaintiffs' exhibit 38 in purple, and on plaintiffs' exhibit 16 in pencil. The 40 acre tract containing the pine trees which defendant had pointed out as the southeast corner of his property was not included within the purple crayon lines on plaintiffs' exhibit 38 but was included within the pencil lines on plaintiffs' exhibit 16. The inclusion of this 40 acres in the 430 acres actually sold would necessarily move the purple line bounding the 430 acres on the west an undetermined distance to the east. The property actually purchased by plaintiffs did not include the (potential) alfalfa land we have mentioned lying west of the north alfalfa field and northwest of Keys Canyon Wash. Neither did it include a little over six acres of the south alfalfa field.

Shearer testified that at a conference during the negotiations leading up to the sale of the 550 acres, Cooper represented the acreage and values of the various classes of lands as follows: Alfalfa land planted, 160 acres at $250 per acre; potential alfalfa land, about 95 acres at $100 per acre; cultivatable land, about 150 acres at $50 per acre; pasture land, about 100 acres at $25 per acre; other land, between 40 and 50 acres, at from $5 to $10 per acre.

A contract dated March 10, 1936, for sale of the land was submitted to plaintiff, and by him to his business adviser. This contained detailed descriptions of the property, principally by fractional sections, township and range. Plaintiff told his business adviser and Backus that he knew nothing of legal descriptions and wanted to be sure that the land described was the property which had been shown him and which he had decided to purchase. To meet this situation, and before the contract was executed, the following provision was inserted: “(Above descriptions to be checked against map and title descriptions, and corrected accordingly).” The property was conveyed to plaintiffs on March 24, 1936.

Defendant agreed to take care of the alfalfa fields for half of the crop, which he did in 1936.

In the late spring or early summer of 1936, plaintiff attempted, without success, to locate the exterior boundaries of the property.

After plaintiff acquired title to the property he commenced a scientific investigation of the various characters of soils and climatic conditions. He purchased four thousand orange trees which he expected to plant on about 50 acres of the land shown on plaintiffs' exhibit 2 as “cultivatable land” lying east of the north alfalfa field. When this “cultivatable land” was cleared it was found to be far short of the area shown on plaintiffs' exhibit 2. He was able to plant only about twelve or thirteen acres. A considerable part of the balance of the supposed “cultivatable land” rose sharply up the side of a rocky mountain and was unfit for cultivation, there being only about thirty acres of cultivatable land east of the two alfalfa fields. Plaintiff made this discovery after the middle of July, 1937.

Rain fell in October of 1936 in a sufficient amount so that water ran down Keys Canyon Wash flowing from side to side in the channel which was obstructed with growths of brush and weeds. Plaintiff had workmen clean it out and straighten it for a distance of about 6,000 feet. Cooper told plaintiff that he hoped plaintiff would do more farming and less cleaning; that cleaning the channel “wasn't necessary”; that “the river wouldn't ever bother me.”

There were heavy rains early in 1937. Plaintiff testified that “starting around February things began to happen. * * * Well, the Keys River ran heavily and jumped the cleared channel in several spots and went down over the south alfalfa field, depositing heavy layers of sand over large areas of it, as well as eroding barrancas in the west part of the field where the edge of the alfalfa drops off to the level of the San Luis Rey River bed.” The extreme width of the Keys Canyon Wash flood was about 1,500 feet. A witness testified that it would be economically unsound to attempt to clear away the great amount of sand which had been deposited over a considerable area of the south alfalfa field. Some damage was done to the north alfalfa field by the flood waters from this wash.

The San Luis Rey River also flooded badly. It was about 600 feet wide at the road crossing we have mentioned. That crossing was not usable for a number of months and water ran in the Keys Canyon Wash until into June, 1937. The floods did very considerable damage to plaintiffs' property. Both the San Luis Rey River and Keys Canyon Wash reached flood stages in the three succeeding years.

Plaintiff had started building his residence on the property before the floods of 1937. He testified concerning that flood: “Well, believing that the flood then was possibly once in a lifetime, I continued building the house. * * *”

Defendant had his property surveyed in the summer of 1937. In August of that year the surveyor, Weeks, established the west and north lines of the property sold to plaintiffs. The west line of the 430–acre tract just cleared the west edge of the north alfalfa field and ran well into the south alfalfa field. The boundaries did not correspond with those plaintiff had been led to believe were the boundaries of his land.

Plaintiff testified that this was his first knowledge of the actual boundaries of the property he had purchased. He then realized for the first time that the representations made to him concerning the land, the areas of the various qualities of soil, and the boundaries of the tract were untrue. He wrote a letter to Cooper in September of 1937 complaining of these discrepancies and asked for some adjustment. Negotiations concerning a settlement of these differences were continued until into December, 1937, when Mr. and Mrs. Shearer gave notice of rescission of the purchase because of fraud and misrepresentation. While the original complaint is not in the record it was probably filed the last of January, 1938. It sought a rescission or damages in case rescission could not be had.

The findings followed plaintiffs' pleadings and were supported by the evidence. The trial court found fraud and misrepresentations which plaintiffs believed and upon which they relied. The findings of the most material false representations may be summarized as follows:

That the land sold contained 160 acres of planted alfalfa, ninety–five acres of potential alfalfa land, 150 acres of other cultivatable land, and 145 acres of pasture and waste land. (The actual acreages conveyed were found to be, 123 acres of planted alfalfa, fifteen acres of potential alfalfa land and 102 acres of other cultivatable land. While the computation was not made, this would leave 310 acres of pasture and waste land instead of between 140 and 150 acres of this land as represented.)

That since the erection of the Henshaw Dam (several years prior to 1932) the San Luis Rey River did not flow heavily and did not flood; that the Keys Canyon Wash was never more than a little creek and could not overflow and damage the land. (Both streams overflowed and caused serious damage after Cooper purchased the property in 1932. Maps furnished Cooper by the Huntington Land and Improvement Company showed that both streams have caused serious damage prior to that year.)

That the property could be reached over the road, already mentioned, leading from the paved highway, except for periods of a few days during heavy rains. (The evidence shows the river could be crossed during the rainy season only on large bridges; that this road was impassable for months at a time.)

That the property was readily accessible over a road from the south which crossed Keys Canyon Wash. (This was untrue, plaintiffs built their residence north of that wash. During one storm Mrs. Shearer and their son were marooned there. Plaintiff had to drop food and supplies to them from an aeroplane.)

That the well, pump, motor, and pipe lines on the property cost $27,000. (Their actual cost was found to be less than $15,000. The evidence shows the cost to have been about $11,329.84.)

Our study of the record leaves us with the impression that Cooper did not know the boundaries of his own land when he pointed them out to Shearer. This is rather evident from the fact that he pointed to the pine trees as the southeast corner of his property when he did not even own the property on which they were standing and had to buy that property from another in order to consummate the sale to plaintiffs. This lack of knowledge of the east boundary indicated that he believed it to be west of its actual location. This belief, perhaps, might have led him into certain misrepresentations concerning some of the areas of the various kinds of soil. While this might bear on the question of a deliberate and intentional misrepresentation on his part, it cannot relieve him from the legal results of these misrepresentations if they were relied upon by the purchasers and they were actually deceived and damaged thereby.

A seller should inform himself correctly concerning the boundaries of land he is attempting to sell before he makes representations concerning their location. De Bairos v. Barlin, 46 Cal.App. 665, 190 P. 188. Misrepresentation of the character of the soil of the land sold, even when made without actual knowledge of their falsity, may constitute actionable fraud. As was said in Gammon v. Ealey & Thompson, 97 Cal.App. 452, 275 P. 1005, 1009:

“Even if appellants did not know that the Connetto land contained alkali in such excessive quantities as to render the land unfit for agricultural purposes, yet, if they represented to Gammon that the Connetto land contained alkali in such small quantities that the same would not injure or damage crops growing thereon, when, in fact, the alkali existed in such excessive quantities as to render the land unfit for the growing of crops thereon, such representations would have constituted fraud. Subdivision 2, § 1572, Civ.Code; McMahon et al. v. Grimes et al. [206 Cal. 526], 275 P. 440.”

Cooper had in his possession means of ascertaining that his representations concerning the flooding from the San Luis Rey River and the Keys Canyon Wash were untrue. The maps delivered to him when he purchased the property showed that floods from both streams had caused serious damage. Another damaging flood occurred after he bought the property. Negligence, carelessness and forgetfulness cannot relieve a person from responsibility for the results of his misrepresentations although when he made them he may not have been conscious of violating any obligation he owed to another. 26 Cal. Juris. pp. 745, 749, and cases cited; 6 Ten–Year Supp. pp. 41, 42, and cases cited.

While not admitting fraud, and arguing there was no actual fraud in the transaction, defendant does not seriously contend that the evidence fails to support the findings on that question. He seeks to escape liability for the reason that plaintiff made a thorough investigation of the land before he bought it and did not rely upon anything he was told but upon what he discovered and actually learned for himself; that prior to the purchase plaintiff knew that at least one material representation made to him was false so that he could rely on no representation made by Cooper.

No question is raised as to the amount of damages awarded nor the measure of damages applied.

Defendant points out that the evidence shows Shearer to be a business man of skill and experience in his own profession, well educated, a clear thinker and possessed of keen powers of observation and a remarkably retentive memory. A study of his testimony bears out these observations.

Defendant's arguments center around four phases of the case. They are, first, the frequent inspections of the property made by Shearer and his study of the aeroplane photographs taken under his direction; second, lines drawn by Shearer on the composite air photograph of the property which correspond closely to the boundaries of the property actually purchased; third, a discovery by Shearer that the two alfalfa fields had an area of 128 acres instead of 160 acres as represented; fourth, a purported reduction in the purchase price because of the discovered shortage in the acreage of the two alfalfa fields.

Before considering these questions in detail it should be remarked that, prior to the purchase, Shearer evidenced a rather surprising simplicity and unawareness and childlike faith in the absolute truth of the representations made to him by others. Had the trial court found that his investigations disclosed the true facts and that he relied upon them rather than on the misrepresentations of Cooper, those findings would have had ample evidentiary support. On the other hand, Cooper stands in the embarrassing position of having made certain untrue representations when he had in his possession evidence of their falsity. If he did not actually know they were untrue he could have ascertained the true facts with slight effort and in a short time. Other representations were made that were contrary to his own experience while he was the owner of the property. Under such circumstances, forgetfulness or carelessness on his part is no excuse for him.

Defendant argues that Shearer was given every opportunity to make all of the examinations of the property he desired; that he went over it many times; that he studied the photographs carefully; that these photographs showed sand streaks and sand deposits on both alfalfa fields indicating they had been flooded; that the steep, broken and rocky nature of much of the land rendering it unfit for cultivation was clearly evident from these photographs; that from this investigation Shearer must have known the character of the land and could not have been misled by any misrepresentations made by Cooper.

The evidence shows that plaintiff came to California in June, 1925; that thereafter he worked for moving picture companies. There is nothing to show that he had any knowledge of farms, farming operations or soils. He testified in effect that his various inspections of the property did not reveal to him the past evidence of damage by floods or danger of future floods because he knew nothing of conditions governing those happenings and because he knew nothing of soils; that while the photographs disclosed much steep, broken and rocky ground he had not been able to locate any boundaries and therefore the pictures did not disclose how much of that character of land was a part of the property he was purchasing. The trial court accepted this evidence as true and it supports the finding based upon it.

It is also pointed out that defendant joined with plaintiff in replacing the two culverts in the road crossing the San Luis Rey River with a small bridge about twenty feet long having a clearance of six or seven feet. Further stress is laid on the fact that plaintiff had the Keys Canyon Wash cleaned out and straightened. From this it is argued that Shearer did not believe and rely on Cooper's statements concerning the small flow of the two streams.

No such deduction need be drawn from such evidence. Plaintiff testified that defendant told him that the two wooden culverts were washed out during rainy seasons so that the road was closed for several days at a time; that he wanted a permanent crossing so he decided to construct a small bridge. This rather supports the contention of plaintiff that he believed the statement of defendant that the flow of the San Luis Rey River was small. Otherwise he would not have designed so small a bridge. It was completely destroyed in the 1937 flood. There is evidence that the flow of the river at that point was 13,000 second feet during the 1932 flood which occurred after defendant had purchased the property. Nor can we attach any great importance to plaintiff's cleaning and straightening the Keys Canyon Wash. Brush and weeds will choke a channel and prevent the flow of water. Cleaning and straightening the wash was an act of common prudence. It was not necessarily evidence of fear of flood.

The lines now appearing on the composite photograph taken from the aeroplane furnish the strongest ground for the argument that plaintiff knew the boundaries of the property, the rugged nature of much of it and that he was not buying all of the south alfalfa field. These lines correspond very closely to the actual boundaries of the land purchased. However, plaintiff explained lines on this photograph to the apparent satisfaction of the trial court.

Plaintiff testified that the aerial photographs were taken in the summer of 1934; that they were assembled into one picture late in 1935 when squares were originally drawn on it; that the scale for the lines drawn on the picture was furnished by Cooper; that if this scale was not correct the computations would prove erroneous. Plaintiff testified concerning the original lines: “I took the 40–acre squares, being based on the figure Mr. Cooper gave me, and I drew some supposedly 40–acre squares over the defendant's exhibit B. Insofar as those squares were concerned, they were dependent on the information I got from Mr. Cooper. When that information so given me, as being in error in some way––When the results therefrom were disputed by Mr. Cooper, then the squares no longer became of any significance.” As Cooper disputed the results of plaintiff's computations, plaintiff concluded the scale was wrong and the lines on the photographs meant nothing.

Plaintiff testified that the original lines were erased and the present lines were drawn at a later date after the purchase, just when does not definitely appear. Plaintiff testified that in June, 1937, he established a base for measuring the areas of the alfalfa fields; that he first learned the correct boundary lines during the Weeks survey. The inference may not be unreasonable that the present lines were drawn on the picture during the summer of 1937. The trial court found in favor of plaintiff on this issue and we cannot disturb that finding here.

After the photographs were assembled, and prior to 1936, plaintiff attempted to determine the acreage in the alfalfa fields by means of a planimeter and asked Cooper for the dimensions of any object appearing on the picture as a base for his calculations. Defendant gave him the purported measurements of the oval appearing inside his race course. Using these measurements, plaintiff computed the total acreage of the two alfalfa fields at 128 acres. He communicated this information to Backus who gave it to defendant. Backus reported to plaintiff, in effect, that defendant said plaintiff was “all wet” and his computations were “cock–eyed.” The assurance that there were 160 acres planted in alfalfa was repeated. Plaintiff testified that with these statements made to him he concluded that the measurements of the “base” were wrong and that his computations were valueless as a result; that he accepted and believed the representations that there were 160 acres planted to alfalfa. The trial court accepted this explanation as true. Ordinarily a defendant cannot lull a plaintiff into security and then maintain that he should have realized that a fraud was being committed upon him. Curtis v. Title Guar., etc., Co., 3 Cal.App.2d 612, 40 P.2d 562, 42 P.2d 323. What was said in Neff v. Engler, 205 Cal. 484, 271 P. 744, 746, is applicable here:

“In Bishop on Noncontract Law, sec. 330, it is said: That plaintiff is too credulous is not generally a defense. ‘The test of the representation is its actual effect on the particular mind, whether it is a strong and circumspect mind, or one weak and too relying.’ (See, also, Bigelow on Frauds, 524.) ‘Every contracting party has an absolute right to rely on the express statement of an existing fact, the truth of which is known to the opposite party and unknown to him, as the basis of a mutual agreement; and he is under no obligation to investigate and verify statements to the truth of which the other party to the contract, with full means of knowledge, has deliberately pledged his faith.’ (Mead v. Bunn, 32 N.Y. 275.) * * * [Citing cases.]”

Defendant urges that plaintiff received a reduction in the purchase price of the land because of the discovery of the shortage in the acreage of the two alfalfa fields. There is evidence to that effect in the record but this contention overlooks the positive testimony of plaintiff that no such reduction in price was made for that reason. Thus we have a sharp conflict in the evidence which was resolved in favor of plaintiff by the trial judge. We cannot reverse a judgment because of conflicts in the evidence.

Finally, defendant argues that, since plaintiff discovered at least one material representation made by defendant was false, this placed him on notice so that he could not rely on any representation made to him. This argument is based on some of those representations already considered, principally on the acreage of the two alfalfa fields. As the trial court found that plaintiff did not learn of the falsity of these representations until after he had purchased the property, this argument must fail. As there is evidence supporting this finding it is conclusive here.

It may be true that defendant was merely mistaken in some, or perhaps all, of his representations to plaintiff and that he did not deliberately intend to wilfully deceive. However, the representations were positively made as to material facts. Plaintiff believed those representations and acted on them to his injury. The true rule governing cases of this kind is set forth in McMahon v. Grimes, 206 Cal. 526, 275 P. 440, 443, as follows:

“Conceding that Mrs. Grimes honestly thought her statements as to the character of the land were true, she was not justified in making them to the plaintiffs, in order to induce the latter to purchase the land through her, for the reason that she had not, and could not have had, any competent information that they were true. Had she made an examination of the land for the purpose of ascertaining the depth of its alluvial soil, and the presence or absence of hardpan and clay thereon, she would have discovered its true character, and as such an examination would have revealed the presence of hardpan and clay, and but a thin layer of alluvial soil, she could not have thereafter truthfully made said statements relative to the character of said soil. If she made such statements without this information, or some other of equal merit, then she was guilty of fraud even if she believed they were true. As was said in Muller v. Palmer, supra [144 Cal. 305, 77 P. 954], quoting from the early case of Alvarez v. Brannan, 7 Cal. [503], 504, 68 Am.Dec. 274, ‘But it is equally true that “whether a party thus misrepresenting a material fact knew it to be false or made the assertion without knowing whether it were true or false, is wholly immaterial.” If a party asserts that as true which he does not know to be true, it is a false representation. If he intends simply to state his belief upon information, then he should state it in that precise form, so as to apprise the other party of the true grounds upon which his statement is made. A party will always be held to make good his statement in the form in which he makes it. If he states a thing as true in general terms without qualification, then he is presumed to do so upon his own knowledge or at his own peril, and must make good his assertion.’ ”

The judgment is affirmed.

MARKS, Justice.

BARNARD, P. J., and GRIFFIN, J., concurred.