McBeth v. Craddock

Philips, P. J. This action appears to have been stoutly resisted by defendant; and his learned counsel has raised and pressed many questions on this appeal, which will be disposed of in their order. I. It is claimed that the trial court erred in adding to the third instruction, as asked by defendant, the words, “or that defendant made such representations as of his own knowledge, when, in fact, he had no such knowledge.” The objection is, that the petition charges that plaintiff knew the representations made by him .were false, whereas, the added words allowed plaintiff to recover, although defendant did not know the statements made by him- were false. It is said by the books, that the tort deceit takes place when one injures another by deceiving him to his hurt. The gist of the action is the fraudulent representations of the defendant to plaintiff’s damage. “There must be fraud as distinguished from mere mistake. It is not, however, always absolutely necessary that an actual falsehood should be uttered to render a party liable in an action of deceit. If he states material facts as of his own knowledge, and not as a mere matter of opinion or general assertion, about a matter of which he has no, knowledge whatever, this distinct, wilful statement, in ignorance of the truth, is the same as the statement of a known falsehood, and will constitute a — 393 — scienter.” Dunn v. Oldham, 63 Mo. 181; Caldwell v. Henry, 76 Mo. 254. All the authorities are agreed, “that deceit may be committed not only with the careful intention of one who knows what he asserts to be true is false, but also with the reckless intention'of one who does not know whether what he represents to be true or false, but who, for one reason or another, is willing that his reckless representations should be believed.” Grinnell on Deceit, 35-36; 2 Add. Torts, sect. 1177. The gravamen of the action is the false representation, made with intent to injure, followed by damage. Medbury v. Watson, 6 Met. 259. Representing a thing to be true, as of one’s own knowledge, which is false, even though not known to be false, and representing the thing to be true known to be false, are, in legal substance and effect, one and the'same thing. They often run into, or overlap, each other. The two modes of averment are but two ways of expressing the same ultimate fact. Caldwell v. Henry, 76 Mo. 260; Savage v. Stevens, 126 Mass. 208; Beebe v. Knapp, 28 Mich. 53; Arthur v. Manufacturing Co., 12 Mo. App. 333. In the Michigan case the instruction was modified almost in the same respect as the one under consideration. The pleader, while setting out the facts of the case, may still, in a measure, plead a fact according to the legal effect thereof; and the evidence which tends to prove the substantive fact is admissible. Turley v. Edwards, 18 Mo. App. 677. In view of the state of proofs in this case, we do not see how the defendant could have been prejudiced by this instruction. The evidence was so overwhelming, that he stated knowingly what he knew to be false, that it is not easy to conceive that the verdict could have been otherwise than for the plaintiff, on either hypothesis. II. Instruction number three, given on behalf of plaintiff, is objected to, because it does not follow the language of the petition, that the representations ‘ ‘ were made for the purpose and with the intent, on the part of — 394 — defendant, to cheat and defraud plaintiff.” The instruction did, however, predicate the essential facts to be found by the jury; and then told the jury that if such representations were false, and known by defendant to be false when made, and the plaintiff, in reliance thereon, parted with her property, she could recover. The petition itself would have been good, where it sets out all the facts showing the fraud and scienter, without, in express terms, averring the scienter, especially so after verdict. Beebe v. Knapp, supra; Dulaney v. Rogers, 64 Mo. 204; Arthur v. Wheeler & Wilson Co., 12 Mo. App. 335. Less merit is there in the objection of appellant, in view of the fact that the court, at his own. instance, instructed the jury,, that unless they found the defendant made the representations- for the purpose of cheating and defrauding the plaintiff they would find for the defendant. We do not regard this, as suggested by appellant, as coming within the rule, that a positive error or vice contained in an instruction for one party is not cured by a correct one given for the other. The latter instruction is rather' to-be' regarded as an extension, or explanation, of a correct proposition of law, as far as it goes,- given in the former instruction. The jury are to consider them altogether.. It is not at all apparent how the jury could misunderstand the direction in such case, and especially in view of the principle that the jury could only find the existence of the evil intent from the tangible facts proved. Hannah v. Baylor, 27 Mo. App. 302; Karle v. Railroad, 55 Mo. 476; Whalen v. Railroad, 60 Mo. 323; Merchants’ Ins. Co. v. Hauck, 83 Mo. 21; Brink v. Railroad, 17 Mo. App. 177; Wilson Sewing Machine Co. v. Railroad, 71 Mo. 203. III. Complaint is made of the action of the trial court in not striking out that portion of the petition, and refusing to exclude any evidence thereof, which set out that defendant, at the time he tendered her the deed from himself for the land, repeated the statements respecting the quality, situation, and value of the land. — 395 — It is true, as contended by the learned counsel, that plaintiff had already parted with her property on the faith of the prior statements. If it were intended, by this allegation and proof, to support an action predicated alone of this conversation, the objection would be well taken. But this latter transaction is a part of the history — the continuing facts — of the case, almost inseparably connected with the main facts, and the final consummation of the defendant’s fraudulent scheme. While plaintiff had parted with her property on the delivery of the first mortgage from Alley, yet, when she went with her brother to see defendant for an explanation of the remarkable conduct of Alley, in forwarding her a deed to another piece of land, without one word in explanation, the defendant, in furtherance of his scheme, and to give plausibility to his professed honesty and fairness, and in order to get the plaintiff to take a deed from him, assuming again payment of his bogus claim of sixteen hundred dollars, and to quiet her apprehensions of some wrong, renewed his statement about the character of the land. This latter transaction and statement bore upon the issue of the quo animo / as much so as the subsequent statements of a fraudulent grantor or assignor in proof of the antecedent fraud. Beebe v. Knapp, supra; Erfort v. Consalus, 47 Mo. 212-213; 1 Hill, 316. IV. The fifth instruction given for plaintiff is objected to, because it told the jury that, although defendant may have told plaintiff not to rely upon his representations, and that he did not advise her to take the mortgage, yet if they further believe that such statements were not made in good faith, but for the purpose of misleading the plaintiff, such fact would not avail the defendant. In such instances there is a close connection between the spirit of the law and the code of ethics. After the defendant had, by his persuasive statements and manceuvers, sown the seeds of confidence in the mind of his unsuspecting victim, it would be a jugglery of words to say he can escape liability for his — 396 — insidious deceit, by cunningly supplementing his convincing speech with the expression, “but you need not believe what I say, or act upon it.” A man would be no less a defamer of character, ad damnum, who should proclaim to bystanders, “my neighbor, John Smith, is a thief; he stole a horse; but you need not act towards him upon what I say.” The law is, that, where the party, by his statements and asseverations, purposely induces one to rely upon their truth, and f orego other sources of information, he cannot escape liability by then suggesting further inquiry. It is a question of fraudulent intent and good motive, for the jury to ascertain. Stones v. Richmond, 21 Mo. App. 17; Big. on Fr. 68-69. Where a party resorts to unlawful methods, and accomplishes a fraudulent purpose, “the law will not stop to measure the force of such inducements. It is enough that the party was deceived and cheated, and the defendant’s falsehood and fraudulent practices contributed to that end.” Jones v. Hudson, 47 Vt. 127. Y. More serious objection is urged against the fourth instruction given by plaintiff, as to the measure of damages. The general rule is, that the limit of damages, in such actions, is the difference between the value of fhe property as represented and as it actually turns out to be. The contention of counsel is, that, while the evidence showed that the land was really of very little value, not over five dollars per acre, there was no evidence as to the value of the land as represented. This objection would be valid, had there been nothing more in the defendant’s representations than the locality, quality, and character of the land. But every case must depend more or less upon its own peculiar facts, because the law itself possesses, necessarily, so much of flexibility as to adapt itself to the varying circumstances and conditions that invest each particular case. The general rule of law is, that mere statements made by a vendor during a negotiation of a sale, respecting the value of the property, is mere commendation, a mere expression of opinion, for the — 397 — incorrectness of which the law affixes no liability. Yet, where the situation of the parties to the negotiation is-quite unequal, as in this case, as where the property is situated in another state, and an inspection of it would be attended with inconvenience and expense, such false-assertions of value, when made as a fact, as in this case may constitute the basis of an action for fraud and deceit. Cahn v. Reid, 18 Mo. App. 116. And this is more especially so where a person not a party to the contract volunteers the false statement. Medbury v. Watson, 6 Met. 260. In the case at bar, the defendant, in various forms, represented the value of this land to be not less than three thousand dollars; that an offer of eighteen dollars per acre had been made for it; that he never-loaned money on land at over one-half its value, and he-had loaned sixteen hundred dollars on this. It was more than the expression of a mere opinion. It was a fact he was stating, and he had a purpose to-have plaintiff so understand it. He must have known that, as plaintiff was about to part with her little all of household goods, and take a second mortgage on-land, that the value of the land in excess of the amount of the first mortgage was an all-important fact to be-informed about. The defendant undertook to give her this information. Why should he not be held to the valuation thus fixed by himself ? How is plaintiff, under defendant’s theory, to secure the benefit of what, in justice and good conscience, belongs to her? By what sort of evidence could she secure the benefit of' this valuation placed on it by defendant ? Where the representations made are as to the location, quality, and the like, of land, it is easy enough for the party defrauded to make proof of the value of such land. But here the material representation made by defendant was as to the value of this land. He is responsible for that falsehood. Now, suppose the valuation placed by witnesses on such land as the defendant described to the plaintiff should fall far below the amount of defendant ’s prior claim and the plaintiff’s damage, how — 398 — could plaintiff avail herself of the other material fact represented, the value of the land at three thousand dollars ? She could not introduce witnesses to prove such a fact, predicated of defendant’s admission and statement. To say that his statement of fact ought not to be held false .as the basis of an action, and true as a basis of recovery of damages, is plausible, but it is not sound. Plaintiffs in actions of replevin and by attachment sometimes, where they fail, are held as to the valuation placed by them in their affidavits on the property taken or seized, when called upon to account to the other party. It often happens, in the administration of justice, that a party’s lies may not avail him when he seeks to be benefited by them, but the party injured by them may hold him to make them good. VI. It is finally objected that the court erred in instructing the jury that they might allow interest to plaintiff from the date of filing suit. It is no objection to allowing interest that the defendant did not get the plaintiff’s property. The basis of the complaint and claim of plaintiff is, that she has been deceived and misled, to her hurt, by the conduct of the defendant, not that the defendant has gained an advantage. He is liable for his fraud which has occasioned the loss of plaintiff’s property. Fisher v. Mellen, 103 Mass, 503-505. The plaintiff is entitled to have the value of the property she lost. How can she be compensated fully without either punitive damages, as for a fraud in fact, or interest on the value of the property, which is but a measure of compensation. Interest seems to have been allowed in such actions. Arthur v. Wheeler & Wilson Co., 12 Mo. App. 341. Other questions are raised by appellant, but they are unimportant. So far as the law is concerned, we think the parties had a fair trial. A review of the evidence has not satisfied us that there could have been any undue prejudice or passion on the part of the jury. The other judges concurring, the judgment is affirmed.