tors to resign, and to be elected in their place four directors nominated by Prentice, in accordance with the terms of the agreement, and that Prentice accepted possession of the property and control of the corporation from Lefurgey, and operated the property under such possession and control and did certain work upon the property, and then failed to comply with the conditions of the agreement which by its terms thereupon terminated and ended. That thereafter Lefurgey demanded possession of the property free of all liens and encumbrances and the resignations of the directors theretofore nominated by Prentice, all of which defendant Prentice refused to do in violation of the conditions in said agreement. The complaint also alleged that while in possession of the property under said agreement and while Prentice was in control of the corporation through the directors nominated and controlled by him, he caused a mortgage to be executed by the corporation to him for moneys expended in working and operating the property, while he was in possession thereof under the agreement, and which, by the terms of the agreement he agreed to pay as a part of the consideration for delivering possession of the property and control of the corporation to him, and it was alleged that this mortgage is fictitious and invalid and constitutes a cloud upon the title of the property. It also appears that before the commencement of the action, plaintiff Lefurgey conveyed an interest in the cause of action to his coplaintiff, Shepard.

The complaint goes into great detail in setting forth the matters of which the foregoing is a brief epitome. It was stated in the complaint that Prentice defaulted in all the progressive payments which he was to make for the purchase of the said stock; that he had involved the corporation in a large indebtedness in the course of operating the mines and had caused a note and mortgage for twenty thousand dollars to be executed by the corporation to him as covering a part of the expenditures made by Prentice in operating the mine, and contrary to the express terms of the agreement, by which he was to operate the mine entirely at his own cost and expense and keep the mining property entirely free from all liens and encumbrances.

The prayer of the complaint is that the defendant, J. A. Prentice, be required to deliver immediate possession of said premises and property to the plaintiffs. That said alleged

promissory note and mortgage be adjudged void, and that they be surrendered by the defendant Prentice and canceled. That it be adjudged that the defendant Prentice has no claim. against the said Stanislaus Gravel Mining Company for moneys expended by him upon the properties while in possession thereof under the terms of the agreement set forth in the complaint, and that all alleged proceedings of the directors of said Mining Company acknowledging or admitting any indebtedness of said company to defendant Prentice be adjudged invalid and void. That defendants Craig, Kinsey, and Duke be required to resign as directors of said Mining Company. Also for judgment against the defendant Prentice for the amount of any indebtedness incurred by him while operating said properties, and which indebtedness was not paid by him, and for attorney's fees and costs and such other and further relief as may seem meet and proper.

Plaintiffs do not seek a money judgment against the defendants. The main objects of the action are, first, to compel Prentice to return the possession of the real property to Lefurgey, from whom he received the possession, and this in strict accordance with the agreement under which Prentice went into possession; second, to have the encumbrance on the real property removed which was placed on the property under Prentice's direction, for his own benefit and in violation of the agreement under which he had possession and control of the property of the corporation. It is true that the title to the property is in the corporation and that the business of the corporation is transacted through its directors. But it is alleged that Lefurgey, by reason of his owning a large majority of the shares of the corporation, did himself in fact control its acts; that in compliance with the agreement he caused his directors to resign and directors of Prentice's selection to be substituted, thus for the time passing control over to Prentice, subject, however, to the agreement that should Prentice fail to keep its covenants on his part to be performed, he would cause his directors to resign and would surrender possession to Lefurgey. Having entered into possession under Lefurgey, Prentice is in no position to deny Lefurgey's right to possession. (Garvey v. Lashells, 151 Cal. 526, 532, [91 Pac. 498].) The nature of the action is to be determined by the averments of the complaint and the nature of the relief that can be granted in the action, and not by the

probable result in a trial upon the merits. Questions raised on the demurrer such as the legal sufficiency of the complaint, whether there is an improper joinder of actions or of defendants, are matters which do not properly arise in determining the motion. Section 392 of the Code of Civil Procedure declares that the following causes must be tried in the county in which the subject of the action or some part thereof is situated: "1. For the recovery of real property, or of an estate or interest therein, or for the determination in any form, of such right or interest, and for injuries to real property." The gist of the action here is to recover possession of the land and to have a mortgage lien fraudulently placed thereon canceled. These objects, we think, clearly characterize the action as local under section 392. The principle governing these cases is quite fully discussed in an opinion by Justice Burnett in Robinson v. Williams, 12 Cal. App. 515, [107 Pac. 705]. See, also, Donohoe v. Rogers, 168 Cal. 700, [144 Pac. 958]. The order is affirmed.

Burnett, J., and Hart, J., concurred.

A petition to have the cause heard in the supreme court, after judgment in the district court of appeal, was denied by the supreme court on April 17, 1918.

[Civ. No. 1780. Third Appellate District.-February 21, 1918.] LOUIS M. HICKMAN (a Corporation), Respondent, v. WILLIAM J. JOHNSON, Appellant.

VENDOR AND VENDEE-DAMAGES FOR FRAUD-DUTY OF VENDEE.-Where a vendee pays a part of the purchase price and enters into possession of the property, and gives his note secured by mortgage on the property for the balance, he must pay the balance before he can claim damages for fraud in the purchase. MORTGAGE-ACTION FOR FORECLOSURE-DEFENSE OF FRAUDULENT REPRE

SENTATIONS-PLEADING INSUFFICIENT CROSS-COMPLAINT-FAILURE TO SHOW DAMAGE. In an action for the foreclosure of a mortgage, a cross-complaint based upon alleged fraudulent representations made by plaintiff as to the ownership of a water ditch to be conveyed to defendant for the purpose of irrigating the mortgaged

land fails to state a cause of action, in the absence of an express allegation as to any appreciable damage done by reason of the failure to convey, there being no averment as to what the ditch cost, or its value, or what expense would be incurred in obtaining a substitute for it, nor how much the market value of the land would be affected by the question as to whether the ditch was appurtenant thereto.

ID. SPECIAL DAMAGES-Loss OF CROP-INSUFFICIENT CROSS-COMPLAINT -KNOWLEDGE OF NONOWNERSHIP OF DITCH BEFORE PLANTING.In such an action, the defendant cannot by cross-complaint obtain special damages for loss of crop due to alleged failure of plaintiff to furnish defendant with necessary water ditches, where, according to the allegations of the cross-complaint, the defendant, before planting the crop, had complete knowledge that plaintiff did not own the ditch and that plaintiff had failed to make good its representations.

APPEAL from a judgment of the Superior Court of Stanislaus County. L. W. Fulkerth, Judge.

The facts are stated in the opinion of the court.

Hawkins & Hawkins, for Appellant.

L. J. Maddux, Henry C. McPike, and James F. Peck, for Respondent.

BURNETT, J.-This appeal is from the judgment decreeing the foreclosure of a mortgage and from the order denying the motion for a new trial.

The only complaint against the action of the court is based upon the order sustaining the demurrer to the amended crosscomplaint and dismissing it from the files.

The action was brought upon several promissory notes for the sum of $24,075 and interest and for the foreclosure of a mortgage to secure the payment of the same. The notes pro- . vided that in case of a failure to pay the interest, as it became due, the payee might elect to consider the whole amount due and bring an action accordingly. There is no controversy as to the failure of the defendant to make the required payments of interest. Indeed, the only payment made by him was the sum of about six thousand dollars on the selling price of $30,175, made at the time of the execution of the conveyance and of said promissory notes. The defense, however, upon which defendant relied, and still relies, is based upon

the claim of fraudulent representations made by the plaintiff. Involved therein are two elements or examples of fraudulent conduct. The first relates to a misrepresentation as to the ownership of a certain ditch, known as the "Dallas Ditch"; the second, to the failure of plaintiff to construct another ditch from the said Dallas Ditch to the land conveyed by plaintiff to defendant.

The material representation as to the Dallas Ditch which the defendant claims to have been fraudulent is as follows: "That as an inducement to enter into the said contract of purchase, that is to say, as an inducement to pay the said purchase price, execute the said notes and mortgage, and accept the said land, the said plaintiff, through its agents, officers, or representatives, represented to this defendant that it was able and entitled to grant to him the right to use the said Dallas Ditch referred to in said agreement, and that said. Dallas Ditch was of sufficient size to irrigate all of the land entitled to be irrigated therefrom and more particularly the premises conveyed to this defendant, and that it carried at least twenty-seven second-feet of water."

As seen, this is not an express allegation that plaintiff represented that it owned the said Dallas Ditch. But we may accept it as a sufficient averment of that fact. This ownership is negatived in appropriate language, as is also the capacity of said Dallas Ditch to supply the needed water.

Again it is alleged: "That at said time it was represented to this defendant, in said agreement of April 26th, that the said plaintiff would make an extension of what is known as the Dallas Ditch, and that said extension would be brought west and flumed across the Ceres Canal on the west line of said land at a point north, and that said ditch and flume would be complete and ready for the conveyance of water therein by October 1, 1910. That all of said representations were false and fraudulent, and were known by the plaintiff and its agents to be false and fraudulent, and were made with the specific purpose of inducing this defendant to enter into the said transaction and agreement, and did so induce him.”

We may assume for the purposes of the case that said representations were material, and that defendant had a right to and did rely upon them. But it is apparent that an additional element must be shown in order to constitute a cause of action in behalf of defendant, and that is, that he