Court Opinion

ID: 5462000
Source: CourtListenerOpinion
Date Created: 2022-01-09 19:39:17.102183+00
Date Added: 2024-06-11T08:32:55.763148
License: Public Domain

By the Court, Bacon, P. J.
This action is founded on an allegation of deceit in the sale of a canal boat. The express averment of the complaint is, that the defendant, intending to deceive and defraud the plaintiffs, falsely and fraudulently made certain representations in respect to the quality and condition of the boat, in which the plaintiffs confided, and were thereby induced to make the purchase; and that these representations were false, and the defendant knew them to be so. The evidence,on the trial was given with a view to sustain these allegations, and damages were claimed for the fraud thus charged to have been perpetrated upon the plaintiffs.
The rules of law applicable to an action seeking to recover damages for fraud and deceit in sales of property, have been long settled, and are very familiar to the courts. In the celebrated pioneer case of Pasley v. Freeman (3 T. R. 51) it was held that a false affirmation made by a defendant, with intent to defraud the plaintiff, whereby 'the plaintiff receives damage, is the ground of an action on the case in the nature of deceit; the principle being that fraud and deceit, accompanied by damage, is a good cause of action. This case has been uniformly followed by the courts in England and in this country, and, as Judge "Wright says, in his opinion in the case of Hubbard v. Briggs, (31 N. Y. Rep. 529,) it is not controverted, now, that where a person asserts a falsehood with a fraudulent design, and damage results therefrom, though he may have no interest even in the deception, it is good ground for a civil action. Intentional and purposed deception is consequently the very gist of this action, and this must in *548some way be made to appear, or no legal claim for damages is laid.
In closing his charge in this case, it seems to me the learned judge lost sight of this principle; for he told the jury that in this action it was not essential to prove any criminal, that is, wrong intent; that it was enough that the representations were untrue, whether known to be so or not. He was then asked to charge this specific proposition : f the jury find that the defendant really believed that the representations made by him in regard to the boat were true, their verdict should be for the defendant.” This direction was refused, and the defendant’s counsel excepted. I think in this refusal the judge erred. This is not like the case of Bennett v. Judson, (21 N. Y. Rep. 238,) which the plaintiffs’ counsel supposes to cover and sustain this charge. That case has always been considered to have carried the doctrine of liability for an alleged' fraudulent representation to the extremest verge of the law, and the courts have been very careful to discriminate and apply it only to the state of facts presented by the case itself.
In that case the representations were made in regard to the quality and condition of property which the defendant, or rather his agent, who made the representations, had never seen, and personally had no knowledge of whatever; and in reference to that case, Judge Comstock, citing a passage from Story’s Equity Jurisprudence, held that if a party make an assertion without knowing it to be true, he is as responsible as if he made the assertion knowing it to be false. The liability was made to attach to one who undertook to assert as a fact a thing of which he had no knowledge whatever, and in respect to which he could not have even a belief; for he had no material on which a belief could be founded, and there was no room for a claim that, although mistaken, he still may have acted in good faith. The statements on which the *549purchaser relied were made in respect to what the party-making them' assumed to know, not what he had heard, or had reasonable ground to believe. In the same passage, quoted by Judge Comstock, occurs this important qualification: “ for the affirmation of what one does not know, or believe to be true, is equally, in morals and in law, as unjustifiable as the affirmation of what is known to be positively false.” This is a very important distinction, and is always to be kept in view in cases of this character, where a fraudulent intent is charged.
If a party has knowledge of the character and condition of the property- with which he is dealing, and makes a representation which turns out to be false, the motive with which that representation is made is all-important when he is sought to be made responsible on the ground that he perpetrated a fraud; and the fact whether he really believed, or had any justifiable reason for believing that what he said was true, is a most legitimate subject of investigation, and upon that, as in all those cases of imputed fraud, where the motive is the subject of inquiry, the party charged with the fraudulent intent is permitted to be heard. The inquiry which the proposed instruction invited, whether the defendant really believed that .the representations he made were true, was one entirely competent, as bearing legitimately and directly upon the fraudulent intent charged. The jury may not have credited the claim thus sought to be made on the part of the defendant; nevertheless, as matter of evidence, it was competent, and the defendant was entitled to have their judgment upon the question of his good faith, which was the essential issue in the case.
I do not think it important to go through the cases, a large number of which have been cited by the defendant’s counsel to sustain his view. The principle is asserted in a variety of forms; that principle being that in order to *550maintain an action for deceit by means of false representations, it is always necessary to aver and prove an intent to deceive; and that whenever a party actually believes what he asserts to be true, he is not liable, although it turns out that what he affirmed was false, in fact. This is clearly and pointedly expressed by "Wright, J., in the case of Hubbard v. Briggs, cited supra: “ If the defendant ignorantly asserted a lie in his effort to induce the defendant to become a subscriber to the stock of the bank, and honestly believed that its condition was as he represented it to be, he would not have been liable.” So in Stone v. Denny, (4 Metc. 151,) the court held that though a representation made by a vendor respecting goods sold by him be not true in fact, yet if he believe it to be true, it is not a ground of action by the vendee against him for fraud in the sale. "Without a further, citation of cases, many of which will be found in the English reports to the same effect, I am in favor, for the error in refusing the instruction asked, of grariting a new trial, with costs to abide the event.
[Onondaga General Term,
January 5, 1869.
Mullin, J., dissented.
Hew trial granted.
Bacon, Foster, Mullin and Morgan, Justices.]