Court Opinion

ID: 9742640
Source: CourtListenerOpinion
Date Created: 2023-08-26 21:17:20.408168+00
Date Added: 2024-06-11T07:24:34.366038
License: Public Domain

Hallows, J.
(dissenting). The defrauded plaintiff should have the option of recovering either under the “benefit-of-bargain” rule or the “out-of-pocket” rule. In fraud cases, the purpose is to wholly indemnify the injured party. In most of the cases, if not all, recovery under the “benefit-of-bargain” rule exceeds what would be recovered under the “out-of-pocket” rule. However, in this case it is quite apparent the “benefit-of-bargain” rule is no bargain, and the plaintiff will recover less than the difference between the *535actual value and the amount he paid for the farm. The result, therefore, is to allow the defendant to keep a benefit from his own wrong, i.e., the difference between the value of the farm as represented and the higher sale price. This is inequitable and unjust.
The two rules have been exhaustively analyzed in Selman v. Shirley (1939), 161 Or. 582, 85 Pac. (2d) 384, 91 Pac. (2d) 312, 124 A. L. R. 1, Anno. p. 37 et seq., in which the court came to the conclusion that neither of the rules should be applied inflexibly. Prosser, Law of Torts (2d ed.), pp. 568, 570, sec. 91, states this decision has given more-careful consideration to the problem than any other and is beginning to be followed in other jurisdictions. In the case at bar, to limit recovery by applying the “benefit-of-bargain” rule in favor of the defrauding party rather than in favor of the defrauded party for whose benefit the rule exists, allows the retention of a bargain by the defrauding party.
I am authorized to state that Mr. Justice Fairchild concurs in this dissent.