Court Opinion

ID: 6839956
Source: CourtListenerOpinion
Date Created: 2022-07-23 20:14:52.487243+00
Date Added: 2024-06-11T16:04:49.093267
License: Public Domain

L. HAND, Circuit Judge
(dissenting). It is quite true that the defendant has not shown that, if it had known Teitler to be the actual buyer, it would not have executed the bond. However, the jury would have been justified in finding that, if it had known that Teitler was in fact engaged in unlawful liquor traffic, and was using a false name to hide that faet, it would not have entered into the transaction. That would have increased the risk, since it is apparent that such a person, who could not presumably get a permit lawfully to withdraw the liquor, was likely to withdraw it unlawfully, and in doing so to evade the duties, just as Teitler did, or at least as a jury might find that he did and meant to do.
Therefore, if the plaintiff knew that Teitler was concealing his name, and was in faet engaged in unlawful liquor traffic, it did not disclose to the defendant faets which materially increased the risk. This, as I understand the law, avoids the bond; the obligee is under a positive duty to diselose such faets, known to him, unknown to the surety. Smith v. Bank of Scotland, 1 Dow, 272; Railton v. Mathew, 10 Cl. & F. 934; Copper Process Co. v. Chic. B. & I. Co., 262 F. 66, 8 A. L. R. 1477 (C. C. A. 3); Franklin Bank v. Cooper, 39 Me. 542; Bank of Monroe v. Anderson Bros. Min. & Ry. Co., 65 Iowa, 692, 22 N. W. 929; Booth v. Storrs, 75 Ill. 438; Pidcock v. Bishop, 3 Barn. & C. 605. There was certainly evidence to support a verdict that the plaintiff did know that Teitler was" misrepresenting his name to the defendant. Perhaps that alone was enough, but, all things considered, I believe it went further, and allowed the jury to say that the plaintiff knew that Teitler proposed to dispose of the liquor unlawfully.
Whether the evidence also implicated the plaintiff as an active participator in the evasion of the duties is another matter. The evidence as to that seems to me scarcely .weaker than the prosecution’s ease on which Friedberg was convicted, Becher v. U. S. (C. C. A.) 5 F.(2d) 45; but it is not necessary to go into that question.
The amendment to the answer was enough to let in the proof.