Lambert v. Smith

Keating, J., by special assignment, delivered the opinion of the Court. Appellants, purchasers of certain land from appellees, sought to recover from the latter part of the purchase price of the land, contending that, although the sales contract recited a lump sum price it was based upon a square foot valuation and they were induced to sign it by representation of the sellers’ agent that the area was greater than the appellants later found it to be. The action was laid in deceit because of the agent’s alleged misrepresentation. At the end of appellants’ (plaintiffs’) case the trial court directed a verdict for the defendants, appellees.

The essential facts are that the appellees employed an agent to find for them a tenant or lessee for their lot of land in College Park and the agent thereupon erected on the land a large sign “LEASE * 27,300 Sq.Ft.” with the agent’s name appended. Appellants, seeing the sign, inquired of the agent the possibility of purchasing, and the latter ascertained from his principals that they would sell for $30,000. With the agent acting as intermediary and the sellers and buyers not meeting, a series of offers and counter-offers were made, the agent finally suggesting that as the lot actually contained 27,355 square feet a fair price would be $27,300, which was approximately one dollar per square foot. This sum was acceptable to sellers and buyers and the contract was prepared and signed.

No mention was made therein of a square foot formula and, in addition, it contained the not unusual provision that “it contains the final and entire agreement of the parties hereto and they shall not be bound by any terms, conditions, statements or representations, oral or written not herein contained.” The plaintiffs’ testimony further showed that earlier, when the sellers engaged the agent to lease the property for them, before he advertised it, he procured a general contractor and cabinet maker, who was well known to him and had performed such services before, to calculate the area of the lot from a plat made some years before by an engineering firm, introduced in evidence, but not explained by any testimony, as plaintiffs’ ex ²⁸⁷ hibit B. The plat shows a lot with four sides, all of unequal lengths and with different compass bearings, with the location of various buildings thereon and a triangular portion on the west side apparently taken or proposed to be taken for a highway right-of-way. It is dated July 1, 1958. The contractor-cabinet maker calculated the area to be 27,355 square feet and Rosewag, the sellers’ agent, relying on the accuracy of the calculation, thereafter advertised it as 27,300 square feet (omitting the odd 55 square feet). The appellants rest their right to recovery on the principle that where fraud or deceit are alleged in the procurement of a written contract of sale, the circumstances leading up to and forming a basis for the contract may be inquired into (Gross v. Stone, 173 Md. 653 , and Rinaudo v. Bloom, 209 Md. 1 ); and, further, that in order to recover in such action, the plaintiff must show five things, viz: (1) that the representation is false; (2) that its falsity was either known to the speaker or the misrepresentation was made with such a reckless indifference to the truth as to be equivalent to actual knowledge; (3) that it was made for the purpose of defrauding the person claimed to be injured