Blanton v. Federal Deposit Insurance Corp.

ROONEY, Justice,

dissenting.

I would affirm. The result reached by the trial court was equitably and legally proper. It must be emphasized that only the $175,000 mortgage of the bank was allowed priority over appellants’ mortgage. This was exactly that which was bargained for by the parties when the bank agreed to make the loan to make possible the sale of the business by appellants to Hall.

Even if parol evidence were allowed to vary the terms of the written note and mortgage obligating the bank to make no additional loans to Hall, and accepting all of that said by appellants concerning the facts in this matter, appellants cannot possibly show any damage to them as a result of the bank’s actions. Appellants complain about the bank’s actions in making additional loans to Hall. If the loans had not been made, Hall would have defaulted much sooner. The loans kept Hall in business and enhanced the chance that he would be successful in paying his obligations to both appellants and the bank. The fact that this effort was unsuccessful is not the cause of damages to appellants.

Appellants received that for which they bargained. The loan proceeds were used to pay off their existing mortgage, to provide operating capital for the business and to pay off other notes due from Hall to the bank. Additional loans were made by the *1116bank to provide for inventory purchases and additional operating expenses. But appellants’ mortgage was held by the trial court to be prior to anything owed to the bank except the original bank mortgage according to the bargain of the parties. Appellants cannot show injury from the transactions. They are in the same position as they would have been if the operation went as they claim it should have.

Once it is recognized that the trial court properly disposed of the claim of the bank, granting the claim in part but refusing to allow priority to the bank for any of Hall’s obligations to the bank except the first mortgage, the contentions in the counterclaim and amended counterclaim cannot be sustained. Certainly, appellants’ mortgage cannot be granted priority over the bank’s first mortgage on the basis of any loss of that bargained for, and it then follows that there cannot be any basis for a claim of fraud. It is almost to the contrary. Appellants got more than they bargained for inasmuch as the bank kept Hall in business much longer than he would have been if the subsequent bank loans were not made. Obviously, appellants expected and wanted Hall to make a go of the business so that they could receive the full sale price for it. Appellants are business people. They knew the risks involved in the transaction. One of the essential elements of fraud is reliance on a false representation “to one’s damage.” Anderson v. Foothill Industrial Bank, Wyo., 674 P.2d 232, 238 (1984); Johnson v. Soulis, Wyo., 542 P.2d 867, 872 (1975). The counterclaim was properly dismissed since it shows on its face that appellants are not entitled to relief. Johnson v. Aetna Casualty and Surety Co., Wyo., 608 P.2d 1299, 1302 (1980).

The bank also points to the fact that in order to grant that requested in the counterclaim, i.e., give appellants’ mortgage a priority over that of the bank, the agreement to allow the bank’s mortgage first priority would have to be rescinded. It notes that one seeking such a rescission for alleged fraudulent misrepresentation must do so promptly. Meyer v. Ludvik, Wyo., 680 P.2d 459, 466 (1984). Appellants had notice of the second bank loan and mortgage when it was recorded on September 19, 1981. Action seeking rescission was not taken until March 7, 1984. A period of two and one-half years between cause and effect cannot be “prompt.” Although the ground for dismissing the counterclaim was not enunciated by the trial court, the trial court’s ruling can be upheld on any legally supportable theory. Valentine v. Ormsbee Exploration Corporation, Wyo., 665 P.2d 452 (1983).