Court Opinion

ID: 9545417
Source: CourtListenerOpinion
Date Created: 2023-08-07 17:12:07.631355+00
Date Added: 2024-06-11T15:14:45.345677
License: Public Domain

TANZER, J.,
dissenting.
The majority acknowledges that this case was not tried as a fraud case. In my opinion, it should not be converted to one on appeal.
*228I assume that from the inception of their representation of their respective clients, the lawyers for both plaintiffs and defendants were alert to the notion that fraud was a possible basis of claim for relief. Yet, until the fallback reference in a post-trial memorandum, at no time in the trial court did plaintiffs’ counsel assert fraud or deceit or defendants’ counsel contend against it. There are practical reasons why both sides may have determined that fraud was a theory to avoid: insurance coverage and the higher standard of proof come to mind. I assume that the lawyers knew what they were doing. They intentionally tried a non-fraud case, but the majority holds that they negligently tried a fraud case.
The root of the difficulty is that plaintiffs’ case was theoretically flawed from the beginning. Section 551 of the Restatement of Torts was repeatedly cited as the legal basis of plaintiffs’ case as if it were law, but it is not necessarily. (I concur entirely with Judge Linde’s comments in this respect.) Even if it does reflect Oregon law, it is inapplicable to this case because, as the majority implies, its scope only includes business transactions such as sales. Its history indicates that its purpose was to liberalize the traditional doctrine of caveat emptor, not to create a general tort of commercial nondisclosure. 42 ALI Proceedings 370 (1965). Its words are consistent with its underlying intent to regulate sales and, to some degree, the broader class of “business transactions” (e.g., loans, leases) as opposed to on-going business arrangements and relationships such as that in this case. Plaintiffs, by avoiding a theory of deceit and by citing section 551 as the sole basis for their case, did not present a sound legal theory of recovery.
The majority holds that section 551 states a cause of action for fraud or deceit, that plaintiffs (despite their best efforts to do otherwise) alleged and tried a deceit case in the terms of section 551, and that the judge, finally aware of deceit as a basis of the case, should make new findings by clear and convincing evidence. This holding offends some fundamental principles of appellate overview. It is basic that we do not review for errors not preserved at trial. The trial court was never requested to make findings by clear and convincing evidence and his findings by a *229preponderance were not excepted to on that basis. We have no procedural basis on appeal to hold that the trial court erred in this respect and to mandate the trial court to make new findings differently.
I do not wish to be understood as holding that persons who are involved in a business arrangement for the purpose of assuring reliability of information and who mislead by half-truth cannot be held liable in a lawsuit based upon a proper theory such as deceit or negligent non-disclosure. That was not this case. Therefore, I dissent from the remand for new findings.