Court Opinion

ID: 3776321
Source: CourtListenerOpinion
Date Created: 2016-07-06 07:26:51.106504+00
Date Added: 2024-06-11T18:07:42.836908
License: Public Domain

Although I concur in the sustaining of the first assignment of error and the reversal of the judgment, I cannot concur in the overruling of the second and third assignments of error.
With respect to the first assignment of error and application of R.C. 1345.02, I concur in the majority opinion with the understanding that we are not holding that no scienter is required but only that proof of intent to deceive is not required. Intent to induce the sale by the buyer's reliance upon the type of representation set forth in R.C. 1345.02(B) or similar unfair or deceptive acts is required. R.C. 1345.03(B)(6) applies to misleading statements of opinion rather than the misrepresentation of fact delineated in R.C. 1345.02(B), which places upon the seller an obligation to know whether the representations made are true. However, the evidence construed in appellants' favor establishes that appellee knowingly made a false statement of fact to induce appellants to purchase the system and that appellee acted unconscionably.
The third assignment of error should be sustained for the reasons stated in connection with the first. Although the majority opinion correctly notes there must be proof that the misrepresentation was "made with knowledge of its falsity and with the intent to mislead another into reliance," reasonable minds could reach only that conclusion if the evidence be construed most strongly in favor of *Page 424 
appellants. Appellee admits he knew the satellite contained an illegal computer chip, yet he told appellants that, by paying a one-time fee, they could receive all channels and never pay another fee. This was false and misleading, and appellants relied upon it as an inducement to purchase the equipment. This is simply a classic case of common-law fraud when appellants' evidence is accepted. It is difficult to conceive how, unless admitted by appellee, fraud could ever be proved if the evidence in this case be insufficient, when construed in appellants' favor, to meet the directed-verdict test.
Appellee, on cross-examination, admitted he knew the descrambling chips were illegal but contended he put them in satellite systems only if the customer requested it after being fully informed. There is a conflict of evidence, appellants' testifying that they did not know their system contained an illegal chip until advised by agent Schroeder, who also testified. The third assignment of error should also be sustained.
Likewise, the second assignment of error should be sustained. The majority finds there is no evidence that Freeman was an employee of Goldberg. However, showing one to be an employee is not the test for application of Evid.R. 801(D)(2), which provides that a statement is not hearsay if:
"The statement is offered against a party and is * * * (d) a statement by his agent * * * concerning a matter within the scope of his agency * * * made during the existence of the relationship * * *."
At the time the evidence was excluded by the trial court, the only evidence was that Goldberg sent Freeman to install the system, that he showed Freeman where to install the disk, that he told appellants that Freeman "was his repairman" and to call Freeman if repairs were needed, and also that appellants understood Freeman worked for Goldberg. In addition, there was evidence that appellants wrote a check payable to Freeman for the first repair call. There was ample evidence that Freeman was Goldberg's agent.
The trial court did not conduct any type of voir dire to permit appellee to present evidence on the agency issue. However, upon cross-examination, Goldberg admitted that Freeman worked for him but as "a subcontractor, installing satellite systems" and further admitted that Freeman made at least one service call for him to replace the motor under warranty "and simply charged the service call, which we do after 30 days." In short, the evidence indicates Freeman was Goldberg's agent with respect to installation and warranty service and, thus, Freeman's statements would be admissible if within the scope of the agency. The statement sought to be admitted was to the effect that part of the system was used, not new. Although this may not be the major foundation for appellants' claim, the trial court should have either allowed the statement in *Page 425 
evidence or conducted a voir dire examination out of the jury's presence upon the objection. Therefore, the second assignment of error should be sustained.