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November 25, 1916 RECORD AND GUIDE 727 LEGAL NOTES AFFECTING REALTY Prepared by Committee on Real Estate Laws of Real Estate Board, Samuel P. Goldman, Chairman Opinion as to Value. THE Illinois Supreme Court holds, Fisher v. Burke, 113 N. E. 711, that expressions of opinion by the vendor of land that he could turn it on a trade at $100 per acre and that it would rent at $4 or $S per acre were not such fraudu¬ lent misrepresentations as to avoid a contract. False Representations as to Value. In an action for damages for failure to perform a written contract for the ex¬ change of properties situated in different States, it appeared that the dc'fendant had never seen the plaintiff's property, and had no notice or knowledge what¬ ever of its character or value, except as he was informed by the plaintiff, who had visited and inspected it. Under such circumstances, the Iowa Supreme Court holds, Sutton v. Greener, 159 N. W. 268, a false statement of market value of property, upon which it is in¬ tended the purchaser shall rely and be thereby induced to make the purchase, becomes a material representation; and, if believed and acted upon, it justifies the party thus overreached in rescinding the agreement. The doctrine that proof of mere "trade talk" or "puffing," such as is common to the trader or seller of property, is not sufficient to sustain a charge of fraud has no application to false representations of material facts •which are, in their nature, calculated to deceive, and are made with intent to de¬ ceive. The rule which under ordinary circumstances renders representations or statements of value non-actionable, applies only where the parties stood on equal footing, and have equal means of knowledge, and there is no relation of trust or confidence between them. Building Restrictions. In an agreement between two owners it was recited that: "Whereas, after land upon a street is improved with fine buildings for residence purposes with the expectation that the neighboring land will be put to the same uses, stores, factories or nuisances are frequently created and maintained to the detriment and sudden depreciation of all neighbor¬ hood property." It was provided in the agreement, which was made a part of the deeds from the owners of the land, that the property should be used for residence purposes only; that it or any part of it should not be used for fac¬ tories, manufacturing, store, mercantile or business purposes; that no more than one residence building should be located upon a lot or tract of land of fifty feet in frontage and the same depth; that anv such residence should be built at least forty feet from the line of the street; and that no residence should be built on the premises costing less than $3,000. In an action for injunction the Ohio Supreme Court held, Arnott v. Williams, 113 N. E. 661, that these re¬ strictions did not prevent the erection of a four-suite anartment house. Delivery of Deeds. It is a fundamental rule of conveyanc¬ ing that in order to pass a perfect title to the grantee the delivery of the deed to property must be voluntarily made by the grantor, for by delivery the grantor divests himself of his title and invests the grantee. To constitute a valid delivery of the deed the grantor must relinquish or part with his right Oi dominion over it, coupled with the in¬ tention of passing title. While posses¬ sion of the deed bv the grantee is prima facie evidence of delivery, the intention of the grantor is the controlling element, as evidenced by the surrounding circum¬ stances. The mere transfer of a deed frora the grantor's possession to that o. the grantee without the former's con¬ sent conveys no title. Such a deed has been said to be of no more effect than il it were a forgery. Tiedeman, in his work on Real Property,^ third edition, p. 827, says: "As long as ft remains in the possession of the grantor, and even where the deed has been stolen and the property passes into the hands of an innocent purchaser, or where the deed falls into the possession of the grantee in any other way than by the consent of the grantor and with the intention to pass title, the title is still in the grantor," Schulz V. Schulz, Illinois Supreme Court, 113 N. E. 638. Assessment of Benefits. In a condemnation proceeding by the city of Chicago to open a street through the defendant's lot, the defendant's wit¬ nesses testified that her property would not be benefitted by the improvement. The City's witnesses testified variously that the benefit to the property wpuld be $2,640, resulting in an assessment of $528, that the property would be bene¬ fitted $5 per front foot, that the benefit would be $1,800, and that all the other property on the street would be bene¬ fitted $2,000. The Illinois Supreme Court held, Chicago v. Matteson, 113 N. E. 595, that a Verdict confirming a com¬ missioner's assessment of benefits at $1,800 did not come within the range of the testimony, and the defendant was entitled to a new trial. Notice from Monthly Tenant. In an action for a month's rent 6f premises, it is held, O'Brien y. Clement, 160 N. Y. Supp. 975, that, assuming that a tenant, by notice to the landlord that the lease was void, became a tenant from month to month, he then was re¬ quired to g:ive a month's notice of inten¬ tion to quit. A tenant from month to month could not, after giving notice of intention to quit on one date, occupy for several months thereafter and claim the notice valid on his then quitting the premises, nor by such notice escape lia¬ bility for rent. Although the landlord was not disclosed in the lease, where the tenant later wrote him, declaring the lease void, and giving notice of inten¬ tion to quit, but then paid several months' rent to him before quitting without further notice, the tenant was liable for a month's rent, on the ground that he had attorned to the landlord. Taxes on Rent. A lease required the lessee to pay "all taxes and assessments except better¬ ment taxes which' may be levied for or in respect of the premises or upon or in respect of the rent payable, however." The Federal Income Tax Law of 1913 re¬ quires the lessee to deduct and withhold from rent due such sum as will be suffi¬ cient to pay the normal income tax im¬ posed on the rent. The Massachusetts Supreme Court holds, Suter y. Jordan Marsh Co., 113 N. E, 589, that this tax was a "tax upon or in respect of the rent payable," and that the lessee was liable therefor and could not deduct it from the rent payable to the lessor. COAL INQUIRY. Federal Trade Commission Make Thor¬ ough Investigation of Conditions. T^HE investigation into the anthracite A coal situation now being made by the Federal Trade Commission at the re¬ quest of the Coal Shortage Committee (the Real Estate Board of New York and the New York Building Managers' Association) is to be a thorough one, ac¬ cording to tlie secretary of the Commis-. sion. Last spring, when it became evident that conditions in the anthracite coal market were pointing to higher prices, the Real Estate Board decided to take this matter up with the authorities at Washington, A committee was appoint¬ ed and the Building Managers' Associa¬ tion was asked to form a similar com¬ mittee. These committees organized the Coal Shortage Committee. President Wilson and the Federal Trade Commis¬ sion were communicated with and an in¬ vestigation was asked. The authorities replied that they would make such an investigation if it were shown that there was sufficient demand for it. The Coal Shortage Committee secured more than a thousand petitions and forwarded them to the Commission on June 30. The pe¬ titioners included consumers of coal in the five boroughs of Greater New York 1" otlier parts of New York State, iii New Jersey, in Minnesota and in Michi¬ gan. In view of the recent sharp rise in the price of coal, inquiry was made of the l^ederal Trade Commission a few days ago as to the progress being made on the promised investigation. Under date of November 15, the Board received, from Secretary Bracken of the Commission, the following answer: Your letter of November 6th, ad¬ dressed to Commissioner Davies, has been received. The Commission wishes to advise you that it has un¬ dertaken an anthracite coal investi¬ gation and that the investigation is proceeding as rapidly as possible. You will understand that the Com¬ mission has no power in this mat¬ ter other than to ascertain facts and to make recommendations thereon to Congress. In order that the rec¬ ommendations it may make may have permanent rather than merely tem¬ porary value, the Commission is go¬ ing thoroughly into the subject. Wholesale prices are now being se¬ cured and tabulated, and prepara¬ tions are being made for ascertain¬ ing the cost of production of the dif¬ ferent companies on a comparative basis. ; Courthouse Site. Reopening of the courthouse matter with the development of the basic facts of civic housing is urged by the Insti¬ tute for Public Service which warns against the acquiescence of the public in the layout as now adopted by the Board of Estimate. The public has been led to think that the city is so far in the hole on this proposal that the only way out is to proceed with the present plan. "This may only be 'pulling in the hole' after them," says William H. Allen, director of the Institute. "An intelligent procedure for the de¬ velopment of a civic center would have had as its basis all the facts concerning the housing of public departments, and not merely a certain amount of informa¬ tion about the courts. "As a first step, and one which re¬ quires immediate and united organiza¬ tion on the part of New York City's in¬ terests, it is suggested that the proper site for a State office buildin.g be deter¬ mined and that the State purchase from the city this site. It is recalled that the Court House Board was created by the State as a mandatory board. It indi¬ cated in its project a State buildin.g. In justice to the city and to develop a civic center gathering the scattered State of¬ fices in a central location, and further to stabilize and develop real estate condi¬ tions in the surrounding territory, New York City should receive from the State the purchase price of the most suitable site around the civic center. "It was the intention also to have a Federal court building around the civic center and a site was proposed by the Court House Board in Colnmbus Park and adjacent areas. Study will show that a much more suitable location is immediately across Centre street from the Tombs, which would make possible not only a better developed civic center, l)ut the layout of more valuable re¬ mainders on the south and east sides of the courthouse site. "Citizens and particularly real estate men are ur.ged to study the prolilem witli all the facts before them and not to acquiesce in present inadequate and too costly plans. A little study will con¬ vince them of the necessity first for or¬ ganizing and securing the State and Fed¬ eral appropriations to insure participa¬ tion of these bodies and to permit a proper planning of the whole project."