McMullen, Receiver, v. Griggs et al.

him the agent of the company. It reads:

[Vol. III, N. S.

"This is to certify that H. H. Barber, the bearer hereof, has this 26th day of June, 1899, been appointed local agent of The Southern Ohio Loan & Trust Company, for Toledo, Ohio, and is hereby duly empowered to solicit subscriptions to the capital stock and collect the membership fee therefor."

Signed by the president and M. S. Todd, secretary.

Britton W. Griggs was the owner, as has been said, of this property. He had negotiated a loan with Irish & Company for $2,500. In fact, he purchased the lot through Irish & Company for a consideration of $1,500 and executed a mortgage thereon for $2,500. They loaned him $1,000 above the purchase price with which he began the construction of this building.

This money being insufficient, in November, 1899, he called upon Mr. Barber, the agent of the loan company in Toledo, and finally made written application to the loan company for a loan of $5,000. This application was rejected; or, at least, one was sent on in its place for $4,500, which he filled out. In that application he represented that the cash value of the lot was $1,600, and that with the improvements when they were completed, the value would be $9,000, and signed answers to various other questions which were printed in the application. This was sent on, and his loan for $4,500 was allowed, and a mortgage was executed pursuant thereto, and sent on to the company. As a part of this application, there was an appraisers' report which was made by appraisers appointed by Mr. Barber, and sworn by him as notary. The appraisers appraised the lot at $900 instead of $1,600, and the buildings and improvements, when completed, at $5,000 instead of $7,400, the amount named in the application, which preceded this appraisement, and was on the same piece of paper. All of this went to the company, the owner's estimate of the property and the estimate put on it by the appraisers. It is claimed that this was such a misrepresentation on the part of Mr. Griggs as would invalidate the mortgage contract or relieve the company at least from advancing the amount they had agreed to advance. It was forther claimed that Griggs represented he was the owner of the

property and sole owner; but that in fact Mr. Swinehart had an equity in the property and that that representation was therefore false, and that the company relied upon these representations in making the loan, and that therefore they are relieved from advancing the full amount of the mortgage, and it is claimed that the mechanics and material men who did work upon the building and furnished the material can have no greater rights than Griggs.

If the company had relied entirely upon the representations of Mr. Griggs, the case would stand differently from what it does. But it appears, instead of relying upon his statement, they required Mr. Barber to appoint three appraisers, who, in his judgment, would be competent to appraise this property; and that they did appraise it, and placed a value upon it considerably lower than the value fixed upon it by Mr. Griggs; that Barber himself examined the property at the time the company agreed to make this loan of $4,500; they had before them the information afforded by this appraisement by appraisers that were appointed by their own agent in the city of Toledo. So it is very clear that they did not rely and did not intend to rely wholly upon the representations that were made by Mr. Griggs. If they did not rely upon them, but sought information elsewhere, they were not prejudiced by the value that he might put upon his property. And more than that, the testimony shows that before this loan was made, which was in February, Mr. Todd, the secretary and treasurer of the company, was in Toledo, and he also seems to have acted in the capacity of general manager of the company. He went out to this property and examined it himself, examined the lot; and the building at that time was well along toward completion, and he examined that; and after an examination by this officer of the company the loan was made. So that the company not only had the judgment of the appraisers, but also the benefit of an examination by one of its officers.

The law is well settled that in matters of value, which are always to a great extent matters of opinion, if the purchaser, as you may call the mortgagee here, examines the property himself and has full opportunity to examine it, and is competent

McMullen, Receiver, v. Griggs et al.

[Vol. III, N. S.

and capable of judging of its value, so that no advantage of him is taken, that a statement by the seller that the property is worth more than it really is is not a fraudulent representation, or such a representation as would avoid a contract. The rule is often applied to personal property, and there is no reason why it should not be applied to real estate in a case where the facts are such as to admit of its application.

Here was a transaction where each party had an opportunity to examine and had sufficient knowledge and experience to form an opinion of his own. So that, so far as these representations, if there were any, as to value, are concerned, we think that they were not of such a character, under all of the circumstances, as would amount to a fraud or would vitiate or affect this mortgage. It appears that Griggs did probably put a high estimate on this property. He paid $1,500 for it however; but the agent through whom he bought it (there is some intimation at least of this) paid only $800, and that was regarded by the agent and his principal, perhaps, as the real value of the property. But Griggs had no knowledge of this arrangement, and he paid $1,500 for the property, and perhaps honestly thought it was worth about $1,500, At any rate, we find, under all the circumstances, there was no representation here that would affect this mortgage.

As to the title, Griggs represented that he was the sole owner of it. It appears by the testimony that Swinehart, his partner, had an equity in it. They were partners in the building business. But Griggs did have the sole legal title to the property, and so far the record disclosed, he was the sole owner. Swinehart makes no claim of any interest in it. So that if these representations of Griggs were not exactly true, it worked no prejudice to the loan company.

The mortgage was sent on, and on February 6, 1900, the loan company, through Mr. Todd, forwarded $3,000 to Mr. Barber, and with it a blank waiver of liens to be signed by all persons having liens upon the property. This waiver of liens apparently was filled out in the office of the company before being sent here. It is a printed blank filled out. And with the check for $3,000 was sent a letter of instructions to Barber to have the

enclosed waiver of liens signed by the persons having furnished labor or material. It was apparent that $3,000 would not finish the building. The material men and mechanics concluded they were liable to lose at least a portion of what they had put in the building. They had various meetings and discussed matters and talked of discounting their claims, and finally, on February 17, they met Mr. Barber at his office, and all of them signed a waiver of liens that had been sent on by the company, in consideration of the company agreeing that the balance still coming upon the mortgage, $1,724.50, would be advanced-the amount in dispute, as stated, really being only $1,500, there being no controversy that the rest was advanced, bringing it up to $3,000. And in the waiver which they signed they postponed their claims to that of the loan company, and their priority to the mortgage of the loan company. The waiver contained this lan

guage:

"In consideration of one dollar paid to each of them severally by The Southern Ohio Loan & Trust Company, the receipt whereof is hereby acknowledged, and in further consideration of a loan of $4,500 granted by the said The Southern Ohio Loan & Trust Company to the said Barton W. Griggs, and secured by mortgage upon said premises, do hereby respectively postpone to the said The Southern Ohio Loan & Trust Company any priority which they may have or might otherwise obtain by mechanics' lien, or other similar liens upon said premises.

The waiver itself contained a recital and statement that this was done in consideration of this loan of $4,500, and the original agreement and arrangement between the loan company and Griggs was that this money was to be used in the construction of this building; and upon a written order signed by Mr. Griggs, it was all to be sent to Mr. Barber, who was to distribute it among the persons entitled to it; the loan company accepting this order, which is as follows:

"THE SOUTHERN OHIO LOAN & TRUST COMPANY:

"I hereby authorize you to pay the proceeds of my loan of $4,500 made in accordance with my application, bearing date

the

McMullen, Receiver, v. Griggs et al. [Vol. III, N. S.

day of, 189-, as stated below, and this shall be your receipt therefor. "$4,500 to H. H. Barber.

So that the arrangement and understanding between Griggs and the loan company was that this money was to be used to complete this building, and that it was to be held by the company, or by its agent, and distributed by him to those who performed labor or furnished material for the building. It was not to go into Griggs' hands at all unless there was some surplus. And the $1,500 being held back, in consideration of the company loaning the full amount of $4,500, the lienholders, the mechanics and material men who were entitled to liens signed this waiver, and the company accepted it.

But besides that, Mr. Barber signed the following paper on the same day, and as a part of the same transaction:

"TOLEDO, OHIO, February 17, 1900. "The Southern Ohio Loan & Trust Company, in consideration of the waiver of certain rights and priorities on the part of certain persons and firms who have performed labor and furnished materials for the erection of a building upon the following real estate, viz., the west twenty-four feet of lot 2 and the east twelve feet of lot 3 in Spaulding's addition to Toledo, Lucas county, Ohio, hereby undertakes and agrees that after the payment of claims and liens which have priority over the claims and liens of such persons and firms signing such waivers, it will retain in the hands of its agent the balance of the fund arising from its loan and mortgage upon said real estate to be paid out from time to time upon and for construction and completion of said building, insurance upon the same and at least one month's dues. Said company represents that said balance will be the sum of $1,724.50, provided that the claims as presented and included in this settlement include all the claims that can become a lien upon said real estate.

"(Signed) H. H. BARBER, "Agent and Local Treasurer of The Southern Ohio Loan & Trust Co."

So that if Mr. Barber was authorized to act for the company in this matter, here was beyond question a contract between the