Hawke v. Fletcher

Edgjekton, C. J. The plaintiff in the court below brought an action at law to recover damages, alleging that he purchased for a consideration of $300, of the defendants, certain promis [45] sory notes made by one Charles A. Bailey, which were secured by a chattel mortgage on the property of the said Bailey; that the plaintiff was induced to purchase the said notes by the representations of the defendants that the mortgage was a first mortgage and that plaintiff relied solely on such representations, when in fact the mortgage was not a first mortgage and was worthless, which defendant knew; that Bailey, the maker of the notes, was and is bankrupt, and has absconded; that plaintiff has suffered damage in the sum of $300. One of the defendants interposes a general denial; the other defendant admits the sale of the notes to plaintiff and the receipt of $300, and denies every other allegation in the complaint. The case was tried by a jury, who returned a verdict in favor of the plaintiff, upon which judgment was entered, and the case is removed to this case upon certain exceptions taken by the defendant, among them that the complaint does not state facts sufficient to constitute a cause of action. The plaintiff’s claim is based upon the allegations in the complaint that the mortgage securing the notes was represented by the defendants and so relied upon by the plaintiff as a first mortgage, when in truth and fact it was not a first mortgage and was worthless. The complaint gives no description of the mortgage nor of the property mortgaged, nor of its value; but the action is to recover damages sustained on account of the property having been previously mortgaged, and that, consequently, the security was worthless. If this action had been brought to recover damages for false representations as to the solvency of the maker of the notes, or if it was a suit in equity to rescind the contract on account of alleged fraudulent representations, a different rale might obtain. In an action like this the complaint should more fully describe the mortgage, in what it is worthless, and especially the value of the security. If the security was of no .value, and the plaintiff knew it, what is the measure of his damage in an action at law? The judgment must be reversed. All the justices concur.