Spiess v. Brandt

41 N.W.2d 561 (Minn. 1950)

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Nature of the Case

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Facts

D, the owner of Jameson's Wilderness Resort, sold it to P for $95,000. P paid a down payment of $10,000 with the principal balance of $85,000 due in installments. Ps found themselves unable to pay the April 15 installment, with the exception of $ 6,000. Ds served a notice of cancellation of the contract. Ps then brought an action to rescind the contract on the ground of fraud and misrepresentation and to restrain Ds from further cancellation proceedings. The trial court specifically found that during the negotiations Ds represented to Ps: (1) That defendants were making good money out of the resort; (2) That plaintiffs could make good money out of it; and (3) That plaintiffs could make all future payments on the contract out of the profits. The court found that the statements made by Ds were known to be untrue when they were made, were made to deceive and induce Ps to enter into the contract for the purchase of the property at a price clearly in excess of its real value. It found that Ds knew that Ps were young and inexperienced and that future payments would have to be made out of profits. The court ordered rescission and for Ds to return P $36,000. D appealed.