#### Thomas *v.*The Guarantee Title & Trust Company.

*Action against am abstracter*— For *negligence in certifying title*— Does *not sound in tort*— Must *be founded on contrac Abstracter liable only to employer*— Usage *can not create contract*— Doctrine *of caveat emptor*— Law *of privity of contract.*

1. An action against an abstracter to recover damages for negligence in making or certifying an abstract of title does not sound in tort, but must be founded on contract; and the general rule is that an abstracter can be held liable for such negligence only to the person who employed him.

2. Usage or custom cannot create a contract or liability, where none otherwise exists. A usage or custom can only be used to explain, or aid in the interpretation of, a contract or liability existing independently of it. It cannot be permitted to contradict or vary the express terms of a contract, nor to vary the legal import thereof.

3. A custom which would relieve a purchaser from the obligations imposed upon him by the doctrine of *caveat*emptor, which requires a vendee to protect himself by express covenants and investigation of the title which he is to acquire, is contrary to law.

(No. 11161

Decided February 23, 1910.)

Error to the Circuit Court of Cuyahoga county.

*433The plaintiff in error in his petition, as amended in the court of common .pleas, averred that on or about the 28th day of September, 1899, one Charles D. Cavanaugh had a life estate under the will of his father Charles Cavanaugh in certain real estate situated in Cuyahoga county and described in the petition; that on or about the said date Charles D. Cavanaugh employed the defendant to prepare and deliver to him an abstract of the title to said real estate and of the encumbrances thereon, and. to certify to the correctness of such abstract; and that accordingly on said date, the defendant delivered to him such abstract with the following certificate: “We have examined the records of Cuyahoga county for title and encumbrances of the above described premises from the year 1795 down to the present date and the same appears good in Charles D. Cavanaugh, subject only to the above encumbrances by said record of this date.” The plaintiff also averred that the phrase “title good in Charles D. Cavanaugh” has a long established customary meaning in the community where it was used, to-wit: the meaning of a good title in fee simple. The plaintiff also averred that there was a custom in the community in which this transaction occurred which was well known to the defendant, that the owner of real property should procure an abstract or certificate of title and encumbrances whenever he proposed to , sell or in any manner encumber his real estate; that it also was the custom, as the defendant well knew, for persons intending to lend money on mortgasres or other encumbrances on real estate, as well as for persons intending to *434buy real estate, to demand the production and delivery of an abstract of title to said property or a certificate of the title thereto with the encumbrances thereon; and that it was the custom of persons so making such demand to rely on such documents relating to the title and encumbrances on said premises in receiving or accepting any transfer, mortgage, or other encumbrances thereon; and that as the successive encumbrances or transfers were made of such real estate, the aforesaid abstracts or certificates were from 'time to time extended to show the state of the title and encumbrances at the time of the intended transaction; and that it was not the custom of the person or persons so extending or bringing up to date the said abstract or certificate to do over again the work which had already been done in the preparation thereof, but that, on the contrary, it was the custom in extending said abstracts or certificates, simply to search the records of the county in which the property was situated from the 'date of the last succeeding certificate up to the date desired by the person desiring such extension to be made. Plaintiff also alleged that the defendant not only knew this custom, but also knew that such abstracts or certificates were meant to, and did, circulate in the community and oass. from assignors to assignees of such real property, and be relied on by each successively for an indefinite period of time. The plaintiff also alleg-ed that defendant was guilty of negligence in issuing the certificate aforesaid, that the title was good in said Charles D. Cavanaugh, when in fact he had but an estate for life therein. It was further averred in said. *435amended petition that the aforesaid certificate was, on October 11, 1899, extended by the defendant to and including said date, and thereafter extended by the defendant to May the 24th, 1902, and afterwards extended by the Cuyahoga Abstract Company to June the 24th, 1902, and that on or about the last named date the said Charles D. Cavanaugh and his wife conveyed the aforesaid premises to the plaintiff by warranty deed, and the plaintiff says that by reason of said negligence of the defendant he lost the difference in value between the fee simple of said lands and the estate for life in said lands, to his damage in the sum of two thousand dollars, for which he prays judgment. The defendant demurred to the petition as amended, upon the ground that defendant does not state facts sufficient to constitute a cause of action, and the demurrer was sustained by the court of common pleas and, the plaintiff not desiring to plead further, judgment was rendered against him. This judgment was affirmed by the circuit court and the case is before this court on proceedings in error to reverse the judgments of the circuit court and court of common pleas.

*Messrs. M. B. & H. H. Johnson*and *Mr. T. H. Hogsett,*for plaintiff in error.

This is an action of tort for negligence. It is not an action for deceit. It is not an action for breach of a contract. It cannot be too strongly emphasized that in this case no reliance whatever is placed upon the fact that the defendant in error was under a contract with Cavanaugh to use due *436care in the preparation of the certificate. The rights of the plaintiff in error are claimed to exist independent of that contract. The theory of our case is perfectly plain and simple.

Perhaps the most accurate analysis of the requisites for actionable negligence is found in 1 Shear. & Redf. on Negligence (5 ed.), Section 5.

The damage to the plaintiff in error is apparent and no intervening agency broke the causal connection between the breach and its natural conseqhences. It will be necessary to discover the foundation of the general rule which imposes on one a duty to use care with respect to another and to state and analyze at more than usual length the cases analogous to the one at hand, for the reason that the present case is one of first impression. ITence, we must have recourse to analogies. The first class of analogous cases which we ask the court to consider is the so-called sub-vendee cases.

It is a universally established rule of law that where a manufacturer or dealer in dangerous or poisonous articles negligently prepares or labels the same, he is liable not only to his immediate vendee but also to sub-vendees who may be injured as a result of that negligence. *Thomas*v. *Winchester,*6 N. Y., 397; *Devlin*v. *Smith,*89 N. Y., 470; *Heaven*v. *Pender,*L. R., 11 Q. B., 506; *Davis*v. *Guarnieri,*45 Ohio St., 470; *George*v. *Skivington,*L. R., 5 Ex. (1869), 1; *Balm Co.*v. *Cooper,*83 Ga., 457.

The second class of cases to which we call the court’s attention is the so-called “exchange car” cases. *Glynn*v. *Railroad Co.,*175 Mass., 510; *437*Fowles*v. *Briggs,*116 Mich., 425; *Railway Co.*v. *Merrill,*65 Kans., 436.

And we have three cases in which recovery was allowed. *Teal*v. *Mining Co.,*84 Minn., 320; *Boyd*v. *Railway Co.,*45 S. E. Rep., 186; *Railroad Co.*v. *Snyder,*55 Ohio St., 342.

Closely resembling, in principle, the preceding “leased car” cases is the “leased premise” case, *Manufacturing Co.*v. *Shoe Co., 71*N. H., 522.

A third class of cases involving the application of principles similar to those which should govern the present case is the telegraph cases., *Telegraph Co.*v. *Dryburg,*35 Pa. St., 298; *Tobin*v. *Telegraph Co.,*146 Pa. St., 375; *Telegraph Co.*v. *Dubois,*128 Ill., 248; *Laudie*v. *Telegraph Co.,*126 N. Car., 431.

Three time-table cases deserve consideration. *Denton*v. *Railway Co.,*5 E. & B., 860; *Heirn*v. *M’Coughan,*32 Miss., 17; *Gordon*v. *Railroad Co.,*52 N. H., 596.

Another collection of cases bearing a striking resemblance both in principle and in their history to cases like the present, are those in which the inhabitants of a city who have lo,st property by fire have sought to recover against a water company which has contracted with the city to furnish water for use in extinguishing fires and to maintain a certain pressure for that purpose. *Fisher*v. *Water Supply Co.,*128 N. Car., 375; *Mugge*v. *Water Works Co.,*52 Fla., 371; *Trust, etc., Co.*v. *Fisher,*200 U. S., 57; *Building & Loan Assn.*v. *Bank,*118 Tenn., 678.

*438We now call attention to another class of cases in which liability has been held on the same ground as that contended for in the present case. *Young*v. *Grote,*4 Bing., 253; *Merritt*v. *Boyden,*191 Ill., 136; *Bishop*v. *Weber,*139 Mass., 411; *Edwards*v. *Lamb, 69*N. H., 599; *Harriott*v. *Plimpton,*166 Mass., 585; *Cann*v. *Wilson,*39 Ch. Div., 39.

If caterers, physicians and valuers, because of the business in which they are engaged, owe a duty of care to that class of persons who may be expected to rely upon their express or implied representations, it is difficult indeed to see why an abstracter of title does not in the same manner owe a similar duty to that class of-persons who may reasonably rely on statements or ’ representations of the abstracter. 1 Cyc., 214; *Chase*v. *Heaney,*70 Ill., 268; *Lattin*v. *Gillette,*95 Cal., 319.

We next call the court’s attention to some cases in which the liability of corporation directors for negligent reports, etc., has been the question at issue. *Houston*v. *Thornton,*122 N. Car., 365; *Seale*v. *Baker,*70 Tex., 283; *Kinkler*v. *Junica,*84 Tex., 116; *Railway Co.*v. *Bank,*56 Ohio St., 351; *Mason*v. *Moore,*73 Ohio St., 275.

*Messrs. Goulder, Holding & Masten,*for defendant in error.

It may be said in passing that the facts plead in the amended petition as to custom do not constitute such a custom as the law will recognize, in that there is no allegation that the custom is the universal mode of dealing in the community. *439Lawson on Usages and Customs, 41; *Porter*v. *Hills,*114 Mass., 106; *Lowe*v. *Lehman,*15 Ohio St., 179; *Wrightson*v. *Bettinger, 2*C. C., 381.

Moreover, the custom alleged by its very nature is not compulsory on anyone; and it is a well settled rule of law that a custom to have any force or recognition must be compulsory and not left to the option of men to use it or not. Lawson on Usages and Customs, 36; *Somerby*v. *Tappan,*Wright, 570.

Without a contractual relation a custom of trade can impose no duty of- diligence in making abstracts or certificates of title. *Kahl*v. *Love,*37 N. J. L., 5; *Gordon*v. *Livingston,*12 Mo. App., 267; *Day*v. *Reynolds,*23 Hun, 431; *Russell*v. *Abstract Co.,*87 Ia., 233; *Commonwealth*v. *Harmer, 6*Phila., 90; *Siewers*v. *Commonwealth,*87 Pa. St., 15; *Zweigardt*v. *Birdseye,*57 Mo. App., 462; *Mallory*v. *Ferguson,*50 Kans., 685; *Savings Bank*v. *Ward,*100 U. S., 195; *Buckley*v. *Gray,*110 Cal., 339; *Mortgage & Trust Co.*v. *Hughes,*20 Fed. Rep., 39; *Winterbottom*v. *Wright,*10 Mees. & W., 109; *Collis*v. *Selden,*L. R., 3 C. P., 495; *Burdick*v. *Cheadle,*26 Ohio St., 393.

There are a few cases where abstracters have been held liable to parties other than those actually contracting with them, but in every instance the liability has been held to be created either because the contract was expressly made for the benefit of the third party, of which fact both parties to the contract had knowledge, or the third party has been found to be brought into privity of contract with the abstracter. *Young*v. *Lohr,*118 Ia., 624; *440*Brown*v. *Sims,*22 Ind. App., 317; *Loan & Savings Co.*v. *Abstract Co.,*31 Mont., 448; *Abstract Co.*v. *Post,*55 Neb., 742; *Building & Loan Assn.*v. *Title Co.,*64 N. J. L., 27; *Appleby*v. *State,*45 N. J. L., 161; *Dickle*v. *Abstract Co.,*89 Tenn., 431; *Denton*v. *Title Co.,*112 Tenn., *320; Houseman*v. *Building & Loan Assn.,*81 Pa. St., 256; *Building & Loan Assn.*v. *Houseman,*89 Pa. St., 261; *Chase*v. *Heaney,*70 Ill., 268; *Lattin*v. *Gillette,*95 Cal., 319.

And there are several cases which refuse to recognize the liability of the abstracter as extending even to third persons who are parties to the very transaction for which the abstract was prepared *Mallory*v. *Ferguson,*50 Kans., 685; *Gordon*v. *Livingston,*12 Mo. App., 267; *Zweigardt*v. *Birdseye,*57 Mo. App., 462; *Savings Bank*v. *Ward,*100 U. S., 195.

Where the abstracter has re-published the abstract to the plaintiff and has thus entered into a contractual relation with the plaintiff, the courts have held that the abstracter was liable. *Siewers*v. *Commonwealth,*87 Pa. St., 15 ; *Building & Loan Assn.*v. *Bank,*118 Tenn., 678.

The text-writers uniformly lay down the rule that to fix liability for negligence upon an abstracter there must be privity of contract with the injured party. Martindale on Abstracts of Title, Section 185; Warvelle on Abstracts, 8; Niblack on Abstracters of Title, Art. 18.

And the text-writers on negligence lay down same rule. 1 Shear. & Redf. on Negligence (5 ed.), Section 574; 5 Thompson on Negligence, Section 6705.

*441It is a general rule of law that a custom of trade imposes no duty on anyone unless as part of a contract. The dealings of trade are by contract, and it is only as the custom is read into the contract that it becomes relevant. *Burdick*v. *Cheadle,*26 Ohio St., 393; *Tilley*v. *County of Cook,*103 U. S., 155; *Bliven*v. *Screw Co.,*23 How., 420; Lawson on Usages and Customs, 356-370; *Bank*v. *Ward,*100 U. S., 196; *Leach*v. *Perkins,*17 Me., 462; *Ulmer*v. *Farnsworth,*80 Me., 500; *United States*v. *Fillebrown,*7 Pet., 28; *McAllister*v. *Barnes,*35 Mo. App., 668; 27 Am. & Eng., Ency. Law (1 ed.), 712; *Daun*v. *Brewery Co.,*L. R., 8 Eq., 155; *Mensies*v. *Lightfoot,*L. R., 11 Eq., 459; *Barlow*v. *Lambert,*28 Ala., 704; *Schooner v: Reeside, 2*Sumner (U. S.), 567.

The abstract, after passing from the hands of the abstracter, cannot be recalled. It passes into the hands of another human agency, who may either retain it or pass it on to others. That human ag'ency is beyond the control of the abstracter.

If such a right of action in tort by subsequent persons relying on the abstract were recognized by the courts, the statute of limitations would be postponed indefinitely. 25 Cyc., 1137; Addison on Torts, 1163; *Ormsby*v. *Longworth,*11 Ohio St., 653; *Railroad Co.*v. *Robbins,*35 Ohio St., 483; *Railroad Co.*v. *Fink,*41 Ohio St., 321; *Cameron*v. *Cincinnati, 9*Dec. Re., 754; *Carpenter*v. *Canal Co.,*35 Ohio St., 307; *Houston*v. *Thornton,*122 N. Car., 365; *Commonwealth*v. *Harmer,*6 Phila., 90.

*442When the certificate of title was delivered to Cavanaugh it passed entirely beyond the control of defendant in error. Cavanaugh could hold it or pass it on to others. At very least no one could rightfully use it without his permission or request, but defendant in error could not recall it or govern its use in any way. Those using the certificates upon Cavanaugh’s 'permission or request must look to him and not to defendant in error. *Longabaugh*v. *Anderson,*68 Ohio St., 131; Wharton on Negligence, Section 138, cites thefirue test as to whether or not the intervention of an independent human agency breaks the chain of cause and effect. *Mill Co.*v. *Oil Co.,*63 Fed. Rep., 400; *Losee*v. *Clute,*51 N. Y., 494; *Fowles*v. *Briggs,*116 Mich., 425; *Glynn*v. *Railroad Co.,*175 Mass., 510; *Carter*v. *Towne,*103 Mass., 507; *Railway Co.*v. *Merrill,*65 Kans., 436.

Davis, J.

So far as we have been able to discover, there has been no exception to the general rule that an action against an abstracter to recover damages for negligence in making or certifying an abstract of title, must sound in contract, the general rule being, that the abstracter can be held liable only to the person who employed him *Savings Bank*v. *Ward,*100 U. S., 195; *Eq. B. & L. Association*v. *Bank,*118 Tenn., 678; *Mallory*v. *Ferguson,*50 Kans., 685; *Schade*v. *Gehner,*133 Mo., 252; *Talpey*v. *Wright,*61 Ark., 275. Even in the exceptional cases in which courts have sought to mitigate the rigor of the rule, that object has been accomplished by straining the doctrine of privity of contract. The following are typical *443cases of that kind: *Brown*v. *Sims, 22*Ind. App., 317; *Denton*v. *Nashville Title Co.,*112 Tenn., 320; *Economy B. & L. Association*v. *West Jersey Title Co.,*64 N. J. L., 27.

The plaintiff in error, however, through his counsel, fully and frankly disclaims any reliance whatever* upon the contract of the abstracter; and claims that his rights exist independently of contract. The theory is that the defendant knowing of the custom alleged (which, in substance, is that all subsequent parties dealing in respect to that real estate would rely upon and act. upon the accuracy of the abstract) a legal duty was thereby imposed upon it to make the abstract accurate, and that, therefore, the certificate by the defendant to its employer would enure to the benefit of all subsequent grantees, by “a natural continuous sequence uninterruptedly connecting the breach with the damage, as cause and effect.” It is at this point, as we think, that the theory of the plaintiff in error breaks down.

In the first place, it is elementary law that uSage| or custom cannot create a contract or liability where none otherwise exists. A usage or custom can only be used to explain, or aid in the interpretation of, a contract or liability already existing independently of it. It cannot be permitted to contradict or vary the express terms of a contract; nor can it vary the legal import of a contract. We need not go far for ‘authority as to this statement of the law. In *Savings Bank*v. *Ward, supra,*Mr. Justice Clifford said: “Testimony was introduced at the trial tending to show that there is a local usage in the district that *444the attorney examining- the title of such an applicant for a loan shall be considered as also acting for the lender of the money, and complaint is made that the court below did not submit the evidence to the jury, with proper instructions. Evidence of usage is not admissible to contradict or vary what is clear and unambiguous, or to restrict or enlarge what requires no explanation. Omissions may be supplied in some cases by such proof, but it cannot prevail over or nullify the express- provisions of the contract. So, where there is no contract, proof of usage will not make one, and it can only be admitted either to interpret the meaning of the language employed by the parties, or where the meaning is equivocal or obscure. *Thompson*v. *Riggs,*5 Wall., 663, 679.” In *Columbus & Hocking Coal & Iron Co.*v. *Tucker,*48 Ohio St., 60, this court said, per Spear, J.: “Equally immaterial, as we think, is the matter óf custom among coal operators in the Hocking Valley and the surrounding mining districts near thereto, of depositing slack and refuse on their own lands, when such custom is invoked to justify deposits so placed as to naturally allow them to wash down to the injury of lands lying below them. The right of the plaintiff to the uninterrupted use of his land, and the unimpaired use of the water of Monday creek being secured to him by the common law, how is it possible that a custom can deprive him of them? Why should a usage, the effect of which, if recognized, is to permit one man to take from another his property rights without compensation, be sanctioned? If it be assumed that the custom is a genera] one, then

*445it is part of the common law itself, anc mere would be presented an instance of. two rules of law, equally binding, and yet wholly inconsistent the one with the other. If it be claimed that the custom is a particular one, then we have the anomaly of a landowner's common law right in his land taken from him by a usage of a particular trade established by strangers, which it is not pretended he has ever been cognizant of, much less assented to. To have affected the plaintiff, the custom must have been shown to have been reasonable and certain, known to him, or to have been so general and well established that knowledge would be presumed, peaceably acquiesced in, and not unjust, oppressive, or in conflict with an established rule of public policy. The alleged custom possessed scarcely one of these attributes. Even though it had been common throughout the state, it would not avail. A usage which is not according-to law, though universal, cannot be set up to control the law. *Meyer*v. *Dresser,*111 Eng. C. L. R., *646; Stoever*v. *Whitman, 6*Binn., 416; *Inglebright*v. *Hammond,*19 Ohio, 337.”

In the second place, in the absence of fraud or such mistake as a court of equity would recognize, in order to uphold the theory advanced in this case it would be necessary to ignore the doctrine of *caveat emptor,*which requires a vendee to protect himself by investigation and express covenants.

In the third place, the fantastic and impracticable theory that “a natural continuous sequence uninterruptedly connecting the breach with the damage, as cause and effect,” gives rise to a cause of action to each subsequent grantee, his heirs *446and' assigns, on through “the corridors of time” to eternity, may be, as it seems to us, conclusively answered in the words of Beasley, C. J., in *Kahl*v. *Love,*37 N. J. L., 5, 8, viz.: “There would be no bounds to actions and litigious intricacies if the ill-effects of the negligence of men may be followed down the chain of results to the final effect.”

The argument founded upon certain classes of decisions, designated as sub-vendee cases, telegraph cases, time-table cases, professional cases, and director cases, does not impress us as possessing any relevance to the issue here. Those decisions are founded upon a public, or *quasi*public, nature inherent in the business or transactions involved. The transaction which is the basis of this action contained no element.of deceit or fraud; it was a mere private contract of employment for services upon a subject-matter about which the public were not, and could not be, concerned. In the nature of the transaction it could not be fairly implied that the public, or any considerable part of the public, would be concerned with the subject-matter of the transaction; or that the manner in which it must be conducted would depend on a custom which is contrary to law, and which would relieve a purchaser from the obligation to investigate fot himself the title to property which he purchases.

The judgment of the circuit court is •

*Affirmed.*

Summers, C. ■ J., Crew, Spear, Spiauck and Price, JJ., concur.