Appeal from the Judgment in the Court of Common Pleas of Allegheny County, Civil No. G.D. 79-18397.
Benjamin B. Wechsler, II, Pittsburgh, for appellant.
Joan Shoemaker, Pittsburgh, for appellees.
Spaeth, President Judge, and Brosky and Olszewski, JJ. Olszewski, J., files a concurring and dissenting opinion.
[ 346 Pa. Super. Page 410]
This is an appeal from judgment entered in an assumpsit action. The case arises from the breach of a contract by which appellant and her husband agreed to buy, and appellees to sell, a house for $225,000. N.T. 18-20. Appellees brought this action to recover their losses when they had to sell the house to someone else because appellants did not settle. Appellant and her husband counterclaimed to recover their deposit money and defended against appellees' complaint by alleging that appellees fraudulently induced them to sign the agreement of sale. The trial court directed a verdict as to liability in appellees' favor, entered a non-suit on the counterclaim, and submitted the case to the jury to calculate damages. The jury awarded damages of $47,634.25 and $19,750 in interest. Judgment was entered and this appeal followed. We reverse and remand for a new trial.
Because the trial court directed a verdict for appellees and entered a non-suit on the counterclaim, we must view the evidence in the light most favorable to appellant. Lamp v. Pennsylvania Railroad Co., 305 Pa. 520, 158 A. 269 (1931). So viewed, the evidence was as follows.
[ 346 Pa. Super. Page 411]
On June 16, 1978, before the parties entered into their contract, appellee Richard Crummer represented to appellant and her husband that he was a director of a real estate business called National Apartment Leasing, but he did not disclose that as director, his duties were the supervision of maintenance. N.T. 31, 120. He then offered to assist appellant and her husband in writing an advertisement to sell their house and, after touring their house, told appellants that they would have no trouble selling it for $235,000. N.T. 122-24. Appellant and her husband asked whether they could make their contract of sale contingent upon selling their own house, but appellee did not agree to this. N.T. 125. As it happened, appellant and her husband were not able to sell their house before the date set by the contract for settlement and as a result, they breached the contract.
Viewed in the light most favorable to appellant, the jury might have found as follows: Appellee Richard Crummer held himself out to be an expert in real estate, when he was not; he assured appellant and her husband that they could sell their own house for a price equal to the contract price, although he had no basis for those assurances; relying on his assurances as an expert, appellant and her husband did not insist upon making the sale contingent on the sale of their own house. Had the jury so found, it might have returned a verdict against appellees, and for appellant and her husband on their counterclaim. For when a party is induced to enter into a transaction with another by means of fraud or misrepresentation, the transaction may be avoided by the innocent party. See DeJoseph v. Zambelli, 392 Pa. 24, 139 A.2d 644, 647 (1958); (per curiam affirmance of conclusions of law and findings of fact of trial court set out at 392 Pa. 24, 139 A.2d 644); Clement Martin Inc. v. Gussey, 191 Pa. Super. 464, 468-69, 157 A.2d 412, 415 (1960). Accordingly, neither the directed verdict nor the non-suit should have been entered.
We also conclude that a new trial should be granted because the trial court did not allow appellant to testify
[ 346 Pa. Super. Page 412]
about appellees' representations and struck evidence that appellees misrepresented the condition of the driveway. The testimony was not excludible as parol evidence, for it tended to prove appellees' fraud in inducing the agreement. See Greenwood v. Kadoich, 239 Pa. Super. 372, 357 A.2d 604 (1976). The evidence as to the condition of the driveway should not have been stricken, for it tended to prove a knowingly false representation that induced appellant and her husband to agree to a given price. "Fraud arises where the misrepresentation is knowingly false [and] renders a transaction voidable even where the misrepresentation is not material." See DeJoseph v. Zambelli, supra; ...