Brett v. Cooney , 75 Conn. 338 ( 1902 )

The plaintiffs in each of the cases at bar (which will be treated as one in this opinion), conveyed a house to Martin, in pursuance of what they supposed to be a contract between them and his law partner, Coyle, for its sale to Coyle for his personal residence. Coyle, in fact, had made no such contract; but they had been induced to believe that he had, and that a conveyance to Martin would serve to execute it, by the fraudulent misrepresentations of the defendants, who had combined to get, in this way, the title in Martin, in order that he might convey, not to Coyle, but to Mrs. Cooney.

It follows that the plaintiffs never agreed to sell their property to any one. The legal title to it has become vested in Mrs. Cooney, through a conveyance to Martin, her grantor, which the plaintiffs voluntarily made on receipt of its fair value. That conveyance purports to be an executed contract between them and Martin. In fact, however, it was procured by a fraudulent misrepresentation to which he was a party. Equity uncovers such frauds and, when they are exposed, has power to supply a remedy.

The jus disponendi is an incident of the ownership of property. The plaintiffs had the right to dispose of their house to whom they would. The defendants fraudulently combined to deprive them of this right, and equity will not suffer them to retain the fruits of their deceitful trickery.

It is contended that the plaintiffs have sustained no damage, and that fraud without damage is insufficient to support an action. It is true that they have received the fair value of their house, and that to turn it into a boarding-house can bring them no direct pecuniary loss, since they own no other property in the vicinity. But they received this value from one who induced them to accept it by a fraud; whom they supposed to be the agent of another; and to whom they conveyed merely as a mode of passing the title to the latter. Their jus disponendi has been directly invaded by his share in the transaction, procured or consented to by the other defendants. The violation of a legal right imports damage.Watson v. New Milford Water Co., 71 Conn. 442, 451. The law implies it, even though, in fact, the defendant's breach of duty proved a benefit to the plaintiff. Excelsior NeedleCo. v. Smith, 61 Conn. 56, 65.

Fraudulent representations constitute no ground for equitable relief unless made to one who was induced by them to act to his injury. Barnes v. Starr, 64 Conn. 136, 150. But in measuring injury, equity does not concern itself merely with money losses. If it finds that a clear right has been invaded, and that redress can be secured by putting the parties back in their original position, it will seldom refuse its aid because the plaintiff can show no substantial damage to his pecuniary interests. The oral understanding between the neighbors on Beach Street, that they would not sell for such a purpose as that for which Mrs. Cooney sought title, would have furnished no ground for an action by any one against the plaintiffs, had they knowingly sold to her. But it put them under an honorary obligation which may be properly taken into account in determining whether a case has been made out for equitable relief. The only persons who would suffer a substantial pecuniary loss, were these deeds allowed to stand, would be those owning residences in the neighborhood of the property conveyed. They, however, could maintain no action against the defendants. Unless the plaintiffs can sue, no one can. Good faith and honorable feeling between man and man called upon them, therefore, to endeavor to retrace the steps which they had unwittingly taken to their neighbors' prejudice. They may be regarded, in a certain sense, as occupying a fiduciary relation as to their right of action, and the damage to others may be considered as bearing on their own equity to relief. They stand in this respect in no worse position than if they had insisted on the insertion, in the habendum clause of the deed to Martin, of a limitation to the use of Coyle. In that case they would have suffered no greater damage, had Martin conveyed to Mrs. Cooney. In that case, the neighbors could only have gained protection against pecuniary loss through some action like this. The plaintiffs are not trustees of their interests. They were under no legal duty, and perhaps under no equitable duty to sue for their protection. But since they have sued, they are entitled to claim the benefit of that favorable regard which naturally attaches to acts done from a just sense of moral obligation. What honor and good faith require a man to ask of a court of equity, for the profit of others, will not be refused without strong cause.

The judgment properly declared both deeds under which Mrs. Cooney claims title to be void, and ordered the paper title held under them to be reconveyed. The deed from the plaintiffs to Martin they could avoid, since it rested on no contract of sale, and was given because they were deceived into believing that there was such a contract between them and Coyle, of which it was a proper execution. That from Martin to Mrs. Cooney they were entitled to have set aside, because it was given in pursuance of a fraudulent conspiracy in prejudice of their right to dispose of their property according to their own will and their own sense of neighborly obligation.

There is no error in either case.

In this opinion the other judges concurred.