Case Name: Pearcy vs. Huddleston
Court: Tennessee Supreme Court
Jurisdiction: Tennessee
Decision Date: 1832-03
Citations: 3 Yer. 36
Docket Number: 
Parties: Pearcy vs. Huddleston.
Judges: 
Reporter: Tennessee Reports
Volume: 11
Pages: 36–38

Head Matter:
Pearcy vs. Huddleston.
Where A sold to B a judgment on C, who was known to both to be insolvent, and falsely represented that C had promised to pay the judgment in plank, which was ready at his, 0⅛ saw mill, whenever applied for: held, that this was such a falsehood and fraud as would be sufficient in equity to rescind the contract.
This bill was filed to rescind a contract or sale of a judgment recovered against Trott and M’Broom, made by Huddleston to Pearcy. Trott and M’Broom were both insolvent, and known to be so to both parties, at the time of the contract or assignment of the judgment. The complainant gave his note for one hundred dollars in cash notes, a note for twenty-seven dollars and fifty cents, and a note for one hundred and ten dollars on a third person, payable in whiskey at fifty cents a gallon, for the judgment; the judgment and interest amounted to about ten dollars more. At the time of the trade, the defendant told the complainant, that there was walnut and cherry plank at Trott’s saw mill, and that he could get the amount of the judgment in plank at any time he might apply for it, and that Trott had promised to pay it in plank. These statements, from the evidence,the court believed to he untrue. The plank, when applied for, could not he got. The circuit court rescinded the contract.
F. B. Fogg, for the complainant.
The statement made by defendant to complainant, that Trott had promised to pay in plank, and that there was a sufficiency of plank at the mill to pay the judgment, was untrue, and the defendant made it knowing its falsity. The complainant, (although he knew the insolvency of Trott and M’Broom,) relied upon this assertion, and believed if such promise were made hy Trott, that it would he complied with. This is such a falsehood, or fraud, as vitiates the transaction, and will induce a court of equity to rescind the contract. 2 Dow’s Rep. 266.
G. S. Yerger, for defendant.
If the representations were as stated in the bill, it is not sufficient to rescind the contract. There was no fraudulent representation as to the subject matter of the contract, (the judgment,) nor of the solvency of the judgment debtors;, it was a mere nude assertion, that an insolvent had promised to pay in a particular way; and whether true or false, the money could not have been coerced out of him.
This is one of those nude assertions or representations which the other party might have ascertained upon enquiry; and it was his folly to trade for a debt on a known insolvent, because it was represented the insolvent promised to pay it in a particular way.
It falls within the class of cases, where the representation does not go to the subject matter of the contract or the solvency of the party, but merely a representation of a collateral fact; which, whether true or false, was the buyer’s folly to credit. As where a man falsely affirms that a person bid a particular sum for the estate, when in fact he made no such hid. Sug-den on Vendors, 3. 1 Roll. Ahr. 101, PI. 16. Dawes vs. King, 1 Starkie’s Rep. 75. Sandford vs. Rose, 2 Tyler’s Rep. 429. Oldfield vs. Round, 5 Ves. 508.
So of a false affirmation of value, it being deemed the purchaser’s folly to credit such a nude assertion. Sugden, 3. 4 Dallas, 250. 2 Bay. Rep. 380.

Opinion:
Green, J.
delivered the opinion of the court.
At the time the complainant purchased the judgment on Trott and M'Broom, the defendant told him that there was walnut and cherry plank at Trott's mill, and that he could get of the plank to the amount of the execution, at any time he might apply for it. It is true, Trott and M'Broom were insolvent; hut as Trott had a saw mill, it was quite likely he might be. able to pay a debt in plank; and the statement of the defendant, that he had the plank ready for the putpose of making that payment, was most likely to take the confidence of the complainant. This representation surely had the effect of inducing the complainant to act, when otherwise he would not; and being false, is therefore a fraud which will affect the sale. 2 Dow, 266. It is not one of those nude assertions, which it is a purchaser's folly to trust; but it is the affirmation of a fact, which if true, would have given real value to the judment, which otherwise was worth nothing.
Decree affirmed.