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Lietz v. Primock

Supreme Court of Arizona

June 18, 1958

Connie D. LIETZ, by her Guardian ad litem, Julia P. Ellis, Appellant,
v.
Paul H. PRIMOCK, Arthur M. Agasie and Nell Agasie, his wife, Appellees.

Page 289

[84 Ariz. 275] Charles Christakis, Phoenix, for appellant.

Paul H. Primock, Phoenix, for appellees.

PHELPS, Justice.

Plaintiff Connie D. Lietz, an adjudged incompetent, by her guardian ad litem, Julia P. Ellis, filed a third amended complaint against Paul H. Primock, Arthur M. Agasie and Nell Agasie, his wife. The defendants moved to dismiss the third cause of action in the third amended complaint for failure to state a claim. The trial court granted this motion, and two weeks later it signed and approved a formal order of dismissal in which it ordered the third cause of action 'dismissed insofar as said cause of action refers to the defendant Paul H. Primock.' Plaintiff appeals from this order of dismissal. At the same time the trial court granted the motion to dismiss, it also quashed an order to show cause which had been obtained by plaintiff for the purpose of ordering defendant Primock to show cause why he should not answer certain questions propounded to him by plaintiff's counsel while taking the deposition of defendant Primock. On this appeal plaintiff complains of the quashing of her order to show cause as well as the order of dismissal.

Essentially plaintiff's first assignment of error asserts that the trial court erred in ordering the dismissal because the third cause of action of her third amended complaint does state a claim against defendant Primock upon which relief can be granted. We agree.

This third cause of action sets up a claim by alleging that plaintiff sustained damage as a result of her reliance upon fraudulent misrepresentations made to her by defendant Primock pursuant to a conspiracy with the other defendants. For the purpose of testing the propriety of the order granting the motion to dismiss, we must accept the allegations of the complaint as ture. Pinkerton v. Pritchard, 71 Ariz. 117, 223 P.2d 933. The allegations of the third cause of action of the complaint set forth the following occurrences. As her attorney, defendant Primock obtained a divorce for plaintiff. Subsequent to the divorce plaintiff became mentally [84 Ariz. 276] incompetent to conduct her affairs. During that period she became three months delinquent in mortgage loan payments on her residence in the total amount of approximately one hundred and fifty-six dollars. While she was mentally incompetent she went to defendant Primock and informed him of her difficulty in making the mortgage loan payments. At this time and while acting as her attorney, defendant Primock stated to her 'that it would serve her best interests under the circumstances and would legally be most beneficial to her to sign a quitclaim deed' and that he would find a person who would make up the delinquent payments. Defendant Primock had her sign in blank a quitclaim deed to her real property which he recorded after inserting the name of Nell Agasie as grantee in the deed. Plaintiff received no consideration for the conveyance of her real property which resulted in a loss to her of her equity therein in the approximate amount of two thousand dollars. The complaint also alleges that defendant Primock willfully and maliciously made the above-quoted representations to the plaintiff, that they were false and material, that he knew or should have known that they were false, that he intended that she rely upon them, that she had a right to rely upon them, and that

Page 290

she did rely upon them to her detriment. It alleged further that the defendants conspired with each other to defraud plaintiff, take her real property, sell it, and share the profits.

The complaint contains all the elements of actionable fraud which this court set forth in Law v. Sidney, 47 Ariz. 1, 53 P.2d 64, and Moore v. Meyers, 31 Ariz. 347, 253 P. 626.

Defendant Primock argues that since his statement upon which plaintiff bases her action for fraud is merely an opinion statement, it will not support her action for fraud. In support of his argument he quotes the following from Law v. Sidney, supra [47 Ariz. 1, 53 P.2d 66]:

'The general rule is that in order to constitute actionable fraud, the false representation must be of a matter or fact which exists in the present, or has existed in the past and cannot be predicated upon the mere expression of an opinion or upon representations in regard to matters of estimate or judgment.'

That this correctly states the general rule we entirely agree. However, the sentence next following the above quote in that case gives the reason for the general rule which makes its inapplicability to the instant case painfully apparent. That sentence reads:

'The person to whom statements of the character last mentioned are made has no right to rely upon them and does so at his peril, nor can they be supposed to influence his judgment.'

[84 Ariz. 277] We believe that a client has a right to rely upon statements of the sort herein involved when made to him by his attorney in the form of advice; and we further believe that they can be supposed to have influenced his judgment. A confidential relationship of attorney and client creates an exception to the general rule, that opinion statements may not serve as a basis for actionable fraud, where such opinion is tainted with an intent to gain some advantage over the client either for himself or for another. The relationship creates the exception because a person has a right to rely upon the opinion of a fiduciary who possesses superior knowledge on the subject concerning which he expresses an opinion. See Restatement, Torts § 525 (1938); 37 C.J.S. Fraud § 10; 23 Am.Jur., Fraud and Deceit, §§ 29 and 30; 12 R.C.L., Fraud and Deceit § 16; Prosser, Torts § 90 (2d ed. 1955). This instant case fits well within this exception. The lower court should not have dismissed the third cause of action of plaintiff's third amended complaint.

Plaintiff's second assignment of error involves the quashing by the trial court of her order to show cause. The occurrences leading up to that action follow. Plaintiff propounded the following questions to defendant Primock while taking his deposition:

(1) 'Did Mrs. Lietz ever come to you and tell you that she was having a little difficulty with her real ...


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