Court Opinion

ID: 6544784
Source: CourtListenerOpinion
Date Created: 2022-07-19 22:18:41.916911+00
Date Added: 2024-06-11T15:55:56.117612
License: Public Domain

Biddtok, J., (after stating the facts). This is an action to recover damages on account of fraud and deceit. The compliant filed in the case is rather prolix, and does not state the facts very concisely, and this may have led to some confusion in the trial of the case. But no objection is made here either as to the form or substance of the complaint, so we have treated the defects in it as cured by the answer and the subsequent trial. The facts, briefly stated, are that Hutchinson purchased f~om defendant Gorman through his agent, defendant Baugh, a house and lot in the town of Searcy. As part of the consideration fcr the property, he agreed to assume and pay certain monthly dues or installments on stock which one Audigier, a former owner of the premises, had agreed to pay to the Arkansas Building & Loan Association, to secure the payment of which Audigier had executed a mortgage on the property, which mortgage was still a valid and subsisting lien thereon for the unpaid portion of the debt or dues. Audigier had borrowed $750 from the association, and had transferred to the association stock of the face value of $1000, and gave a bond secured by mortgage, as above stated, that he would pay all subsequent dues on the stock required by the rules and by-laws of the association. He did not, it will be noticed, agree to pay any certain amount, but was to pay the monthly dues until the stock matured. In assuming this contract, Hutchinson on his part did not agree to pay any certain sum, but agreed to pay the subsequent installments required to mature the stock. At the time Hutchinson purchased the property, this contract of Audigier had been in force nearly six years, and only those familiar with the affairs of the association could tell with any degree of certainty what additional sums would be required to mature the stock. The home office of the association was at Little Bock, but Baugh was a stockholder in the association, and was secretary of the local board at Searcy. The contract with Hutchinson was made at Searcy, n.d he alleges that he was induced to purchase the property and to assume the contract of Audigier with the building and loan association by reason of a representation made by Baugh that one hundred and sixty dollars would be all that was required to pay this debt, or, in other words, that the balance due to the association was not more than one hundred and sixty dollars. Hutchinson alleges that this representation was false, and he makes it the basis of his action in this case, but the circuit judge held that he was estopped to maintain the action by reason of the fact that he had assumed the debt of Audigier to the building and loan association as part of the consideration named in the deed. Now, this being an action to recover damages for fraud and deceit, we think it is clear that the circuit court erred in holding that the acceptance of the deed by plaintiff, and the further fact that he assumed the debt of Audigier to the association, estopped him from bringing this action. Plaintiff is not suing on the contract, nor is he denying his contract. He admits the contract, and that he is bound by it, but founds his action on a tort by alleging that he was. induced to make the contract by reason of a false representation made by defendant Baugh. But, although we are of the opinion that the circuit court erred in its declaration of the law, still we are by no means certain that the evidence was sufficient to warrant the recovery by plaintiff in this action. In order to sustain an action for deceit, the plaintiff must not only show that he was misled and damaged b; a false representation concerning a material fact, but he must go further, and show that the defendant knew at the time he made it that the representation was false, or that, being ignorant of whether it was true or false, he asserted that it was true, and did so with the intention to deceive the plaintiff. Hanger v. Evins, 38 Ark. 334; 14 Am. & Eng. Enc. Law (2d Ed.) 86; 8 Am. & Eng. Enc. Plead. & Prac. 899, 902. Now, Baugh testified that he made no positive statement as to the amount of the debt, but only gave an estimate of the amo ant, and the facts in proof seem to support his testimony. If Baugh stated to Hutchinson that the balance due the building and loan association was only $160, it is somewhat strange that this amount was not named in the deed or in the written agreement indorsed on the bond of Audigier to the association by which Hutchinson assumed and undertook to carry out the .contract of Audigier. The fact that no certain amount was named for this debt, either in the deed or in the contract of Hutchinson assuming it, tends, as we think, to support the statement of Baugh that the amount was unknown, and that his statement in reference to the balance due on the debt was only an estimate, and so understood by Hutchinson. But, while the weight of evidence seems to us to favor defendant, there was evidence to the contrary. The testimony of Hutchinson and of Baugh on this point are directly in conflict, and we can not determine the ease here on the weight of evidence as it appears to us. That is a question for the jury. The fact that Hutchinson might have learned the truth by writing to the home office of the association at Little Bock would be no defense if Baugh knowingly made a false representation as to the amount of the debt with intent to deceive, and thereby misled Hutchinson to his injury. While, as before stated, we think there is not much evidence to sustain that assertion of the plaintiff, he had, we think, the right to submit the question to the, jury, and we are therefore of the opinion that the court erred in directing a verdict. For this reason the judgment is reversed, and cause remanded for a new trial.