Opinion ID: 2612550
Heading Depth: 1
Heading Rank: 3

Heading: Fraud vs. omission, incorrect statement or misrepresentation.

Text: First, plaintiff contends that the affirmative defense is insufficient because it only alleges that the answer was fraudulent, whereas the jury found no fraud. In contrast, the statutory terms  omission, incorrect statement, and misrepresentation  which the jury did find, are not alleged. Fraud or fraudulent are terms of uncertain meaning. They are conclusions that must be fleshed out by elaboration and by consideration of the context in which they are used. This is why Rule 9(b) requires that the circumstances constituting fraud shall be stated with particularity, a requirement we have construed to require allegation of the substance of the acts constituting the alleged wrong. The Rule 9(b) requirement should not be understood as limited to allegations of common-law fraud. The purpose of that requirement dictates that it reach all circumstances where the pleader alleges the kind of misrepresentations, omissions, or other deceptions covered by the term fraud in its broadest dimension. Consequently, if the pleading had merely alleged that the insured had given fraudulent or deceptive or misrepresenting answers, it would have been insufficient. In contrast, this affirmative defense recited a particular answer to a question involving alcoholism, and specifically alleged that this answer was fraudulent or material to the acceptance of the risk or the hazard assumed or that the defendant would not have issued the policy (at least not at that rate) if the true facts had been made known... . In the context of the statute paraphrased here, § 31-19-8, this allegation was sufficient and fair notice to put in issue all of the statutory defenses of deception, including the omission, incorrect statement, and misrepresentation ultimately found by the jury. [5]