National Conversion Corp. v. Cedar Building Corp.

Tenant National Conversion Corp. (plaintiff) leased industrial property from landlord Cedar Building Corp. (defendant) under a lease incorrectly stating the property was zoned for unrestricted use; when the tenant's lawyer sought an adjournment to independently verify the zoning, the landlord's lawyer and principal insisted the landlords already knew the area and knew the property was zoned unrestricted, a representation the parties incorporated into the lease along with the landlords' guaranty of its accuracy. After discovering the property was actually zoned industrial, the tenant sued for fraud and breach of warranty, the landlords countersued for rent and possession, and the trial court and a divided appellate court both ruled for the tenant; the landlords appealed, arguing a misrepresentation of law cannot support a fraud claim.