MEYER H. GOLDMAN & another vs. FREDERICK J. MAHONY, JR., & others.

WHITTEMORE, J. The plaintiffs in two counts in tort alleged false representations in respect of a house which they subsequently purchased for $45,000 from three of the defendants, partners, doing business as Mahony & Long Associates. [Note 1] The substance of the important misrepresentations (allegedly made in several varied and somewhat detailed statements) was that the two basement rooms and the ground floor vestibule were dry and had no water problems.

The third count was in contract for the breach of an undertaking, given as a part of the sale, that "[i]n consideration of the purchase of the premises . . . by . . . [the plaintiffs, the three defendant partners] hereby guarantee for a period of one (1) year sound construction and quality workmanship and also agree to repair any leaks, except those caused by any fault of the owner."

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The jury found for the defendants under all counts.

The evidence included testimony that the plaintiffs noticed indications of water in the living quarters and in the basement, that the representations were made in the resulting conversations, and that the defendants at least should have known that there were water problems in the basement and vestibule. The jury could have found reliance, or they could have found that, rather than relying on the defendants' statements, the plaintiffs required and relied on the contract.

The evidence showed that, after the sale, water appeared in the basement and the ground floor vestibule. It then became apparent that there were serious inadequacies in the drainage system which the three defendant partners (hereinafter, the defendants) had installed to carry away the considerable amount of groundwater that seeped down the slope behind the house. Called upon to make good under their guaranty, the defendants did a very substantial amount of work in reconstructing and greatly enlarging the below ground and below basement drainage system.

1. The plaintiffs argue several exceptions to rulings on the admission or exclusion of evidence. The rulings were all either within the reasonable discretion of the judge or not prejudicial in view of other testimony.

(a) There was ample direct testimony showing that the plaintiffs relied on the representations and "would [not] have purchased the house . . . [had they known] that they had any problems with water coming through the cellar floor" and would not have "taken the house as a gift if . . . [they] had the slightest inkling" about the water problem. The excluded questions as to whether the plaintiffs relied on the representations are of the kind customarily put and admitted but they disclose the expected answer, and their exclusion is not prejudicial where reliance is otherwise directly shown.

(b) It was within the judge's discretion to exclude evidence of a flood in a neighbor's house.

(c) One of the alleged misrepresentations was that the

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house conformed to the strict requirements of the city of Newton building code. An excluded question to one plumbing inspector and an answer permitted to be given by another inspector related to compliance with the plumbing regulations. As the case developed, this was a subordinate and unimportant issue. The house plainly had water problems regardless of what the regulations required. There is no basis for a reversal in these rulings. It was beside the point whether an inspector would have approved had he seen a drain pipe not connected with the sewer pipe. The regulations were not then in evidence. They could not thus be proved. Another inspector was allowed to give his opinion whether a particular section of the regulations applied to perforated drains laid in the ground. This, at most, showed the department's construction of the provision. In some circumstances this could have been relevant to the court's construction. Cleary v. Cardullo's, Inc. 347 Mass. 337, 343. It was in any event not unrelated to whether the defendants should have known of noncompliance with the building code.

(d) In the circumstances there was no prejudice in allowing in cross-examination the question to the male plaintiff whether he would accept an offer from the defendants to buy back the house for what the plaintiffs had paid plus any improvements they had made "under an appropriate accounting." Although this risked raising extraneous issues, it was related to certain of the plaintiffs' contentions and, in view of the answer, [Note 2] the plaintiffs were not harmed.

(e) There was plainly no error in excluding several questions to the defendant Thomas E. Mahony. [Note 3]

2. We see no error in respect of the count in contract. The judge charged that the guaranty to repair any leaks

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applied to leaks appearing within one year. This is the reasonable construction; the evidence showed no ambiguity raising a question for the jury. The instructions given adequately indicated that the defendants would remain responsible for their inadequate repair of leaks which had appeared in the one year guaranty period. The undertaking does not apply to leaks appearing in the indefinite future. The judge rightly told the jury that if the defendants had not carried out their contract the plaintiffs were entitled to recover the cost of doing what remained to be done.

3. Of the several exceptions to the charge applicable to the counts in tort, only two require extended discussion. They both concern the application of our rule, which the judge duly stated, that the plaintiffs are entitled to recover damages sufficient to give them the benefit of their contractual bargain, if such damages are reasonably proved. Rice v. Price, 340 Mass. 502, 507-510. Restatement 2d: Torts (Tent. draft No. 10, 1964) Section 549. [Note 4] The judge indicated that the worth of all that the plaintiffs received, including the worth of the guaranty as reflected in what the defendants did under it (see fn. 5), was to be measured against what the plaintiffs would have received if the representations had been true. This is right and the plaintiffs' objection is not well taken.

At the close of the charge, the plaintiffs' attorney took an exception to "the charge . . . that if plaintiffs got a bargain, then they suffered no damage." The language referred to is indicated by supplied emphasis in the portion of the charge in the margin. [Note 5] As the marginal quotation

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shows, both before and after the instruction complained of, the trial judge correctly stated the law as to damages.

In light of the plaintiffs' evidence as to value, we think there was no prejudicial error. This evidence consisted of testimony by one plaintiff that the house with its water problems was worth from $20,000 to $25,000, but that if the representations had been true the house would have been worth $45,000. The sale price was $45,000. That is, the value of the bargain was to have a house worth what the plaintiffs paid for it. [Note 6] If, as the judge charged, the

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house when made good under the guaranty was worth the price paid for it, they had received the benefit of the bargain and, apart from the incidental items next discussed, they were not damaged.

The charge did not prejudice the plaintiffs' right to recover for their own expenses and their inconvenience before and in the repair period. The judge, as the marginal quotation shows (fn. 5), was explicit and clear that these items were over and above the damages as determined by the value figures for the house. In the circumstances, the verdicts for the defendants on the counts in tort reasonably show the jury's conclusion that misrepresentations, if made, were not relied on; not that the jury were misapplying the rule of damages.

4. There is nothing in the other exceptions to the charge and alleged omissions to give requests. It is sufficient that the substance of requests, if appropriate, be covered in the charge. The judge's discretion determines whether to refer to parts of the evidence. There was no occasion to state expressly that fraud was not merged in the contract. The case in tort was fully set before the jury. The charge on the issue of reliance was sufficient to inform the jury that the alleged misrepresentations need not have been the sole factor on which the plaintiffs relied in making their purchase. It was not reversible error to instruct the jury to disregard testimony of out of court statements by alleged experts; that the drainage system under the plaintiffs' house was defective and inadequate at the time of sale was otherwise fully established by the extensive alteration work the defendants did subsequent to the sale under their guaranty. It was not required that the judge instruct that an adverse inference could be drawn from the circumstance that certain defendants did not testify.

We have considered all the points argued. Only a point of practice remains.

5. The plaintiffs filed an outline bill of exceptions under S. J. C. Rule 1:22, 351 Mass. 742 .

Each party properly filed designations under par. (2)

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of the rule. Instead, however, of filing with his brief as a record appendix such parts of the transcript so designated as the plaintiffs' attorney deemed "necessary to his argument," as par. (13) requires, he filed a running summary of the testimony similar to that which would be contained in a narrative bill of exceptions. Such a bill, however, would come before this court only after scrutiny by the opposing party and its allowance by the judge as a true bill. Thereupon the defendants filed a record appendix reproducing the full text of the transcript that had been summarized by the plaintiffs.

The rule (par. 13) specifies that the record appendix accompanying the brief shall consist of only so much of the designated transcript as the party "deems necessary to his argument." This, of course, may be less than the portions of the transcript preliminarily designated under par. (2). The entire transcript, or, in any case, at least the designated parts of it, will be before the court, and available for inspection and consideration in the event that the record appendices appear at the argument, or on study, to be inadequate. The aim is to minimize the expensive reproduction of parts of the transcript that probably will not bear directly on the points argued.

Action to exclude or correct or supplant the plaintiffs' improper narrative statement was required. Paragraph (13) of the rule expressly permits an adversary party to file in his record appendix "additions to or corrections of the excepting party's record appendix." We order that the cost of printing the defendants' record appendix, so far as it includes material designated, initially or in reply, by the plaintiffs, is to be recovered as costs by the defendants in addition to the other costs to which they are entitled. The amount shall be determined in the Superior Court.

6. The plaintiffs' exceptions are overruled.

So ordered.