Endsley v. Johns

Mr. Justice Shope delivered the opinion of the Court: This was an action on the case, for fraud and deceit, brought to the circuit court of Coles county, resulting in a verdict and judgment for the plaintiff. On the defendant’s appeal, the Appellate Court for the Third District affirmed the judgment, and on his further appeal the case is brought to this court. An accurate statement of the character and state of the pleadings, and issues arising thereon, will be found in the opinion of the Appellate Court, (Endsley v. Johns, 17 Bradw. 466,) rendering any further statement here unnecessary; and as this is an appeal from a judgment of the Appellate Court affirming the judgment of the circuit court, the finding and judgment of the former as to all contested questions of fact, must necessarily be taken as conclusive upon this court, and will be so. regarded in our consideration and discussion of the questions of law arising upon the record. It is not denied that an action of this character can be maintained, and counsel for appellant concede that the case made by the appellee, in his declaration, is within the doctrine of Weatherford v. Fishback, 3 Scam. 170. And as there is abundant evidence in the record upon which this verdict and judgment may rest, it only remains for us to consider the questions of law arising upon the action of the trial “court in admitting or rejecting evidence, and in giving or refusing instructions. Our attention is called to two alleged erroneous rulings on the admissibility of evidence. The same question was made in the Appellate Court, and the answer of that court seems to us conclusive. That court said: “It is urged, also, that the court erred in permitting Kimlin to testify that he made an arrangement with defendant, the day before the transaction, to ‘make the check good ’ with plaintiff. This would be competent, as tending to prove the defendant’s knowledge of the truth of the alleged representation. It is also objected, that there was error in allowing the introduction of certain shipping bills in which Kimlin and defendant were jointly interested. We can not consider this, because it does not appear that these matters of evidence were objected to when they were offered.” Objection is urged to appellee’s first instruction, wherein the jury were told, that when a sale of personal property is made, and the time of payment is not agreed upon, “the law is that the price is due and payable upon delivery of the property sold.” The objection is, that it states an abstract proposition of law, “and was intended either to impose some duty upon the defendant because of the delivery of the cattle to him, or to lay the foundation for a presumption that the defendant made” the deceitful representations imputed to him. The instruction stated the law with substantial accuracy, and under the averments of the declaration, aiid the exfidence, the jury might well be told, as in effect they were by this instruction, that when Johns delivered the cattle Kimlin had bought of him, to Endsley, the agent of Kimlin to receive the cattle, Johns had a right to be paid the purchase price therefor. Kimlin had selected Endsley to receive the cattle from Johns, to weigh them, and to pay for them with •Kimlin’s signed blank c^ieck placed in Endsley’s hands for that purpose the day before. Endsley did receive and weigh the cattle, and filled in the proper amount in Kimlin’s signed blank check, and tendered the same to Johns in payment for the cattle. Johns accepted the.check in payment, after, as he says, Endsley made to him the false and deceitful representations alleged. Johns had a right to be then paid in money; and that he waived this right, and took instead a worthless bit of paper, was because of the alleged false and deceitful representations as to the financial ability of the maker of the paper, to him, by Endsley. The appellee’s second instruction is said to be erroneous. Therein the jury were told, that if the'defendant made the representations alleged in the declaration, or the material part of them, and that such representations, or the material part of them, were false, etc., then the verdict should be for the plaintiff. The objection is, that the jury were thus authorized to determine what part of the alleged representations were material,—that this is a question of law for the court, and not a question of fact for the jury. The instruction is open to the criticism made. It is a general rule, that the court must determine what allegations in a pleading are material and necessary to be proved, and it is improper to submit that question to the jury. But this rule must receive a reasonable application. It is not every error that will reverse, and if the court can see that the instruction complained of, in connection with the whole series of instructions, and the allegations and proofs in the particular case, would not mislead the jury or injuriously affect the adverse party, the verdict may stand, notwithstanding the error. This principle has been applied so often, and is so well understood, that citation of authority is unnecessary. In this case, the allegations of falsehood and deceit were stated in different forms in the two counts of the declaration, and it is seen that they are all very much the same in effect, and that each so-called misrepresentation, when coupled with the general averments in each count, would constitute a separate cause of action. Under such circumstances, such allegations may be regarded as divisible, and the plaintiff may succeed, if he can prove any one of them which, of itself,, makes a cause of action. This was the view taken by the Appellate Court, and rightly. But it is also true that the plaintiff might recover although he did not prove the misrepresentations precisely as laid, (Ladd v. Pigott, 114 Ill. 647,) nor in all the different forms as laid; but it was required of him to prove substantially the material allegations. Here, the alleged misrepresentations were all and each of them material, and the jury were not required to distinguish between material and immaterial misrepresentations. They all related to the simple inquiries : was the check good; would it be paid; were appellant’s representations false, and did he know them to be false; were they made with intent to deceive. Unless the alleged representations were false, known to be false, and made with intent to deceive, the plaintiff could not recover. There was the sharpest conflict in the evidence. The jury could take no middle ground. Unless they believed appellee and his witnesses, no material allegation as to representations was proved; if believed, every such allegation was proved. In such case, we can not say the instruction was calculated to mislead the jury or injuriously affect the appellant, and the error was not such as should reverse. By the third instruction the jury were told, that the plaintiff was not required to prove the exact words of misrepresentation laid in the declaration, to entitle him to recover, and that it was only necessary for him to prove, that, substantially, the statements set forth in the declaration were made by the defendant. The objection urged is, that the plaintiff was thereby relieved from the obligation of supporting the case made by the declaration, by a preponderance of the evidence. The declaration averred that appellant made certain statements and representations to appellee, and set out such representations. By this instruction the jury .were told, that appellee might recover, although he had not proved that appellant used the exact words laid in the declaration, if he had substantially proved them. We said in Ladd v. Pigott, supra: “Plaintiff is, perhaps, not bound to prove the representations precisely as alleged, but he must prove the substance or the material part of such representations, and more strictness than that the law does not require.” The instruction under consideration is not only within the rule of the Ladd case, but does not assume, directly or inferentially, to relieve the appellee from the just obligation of maintaining his case by a preponderance of the evidence. The next objection is to appellee’s sixth instruction, which told the jury, that if a person, makes an untrue statement to another, knowing it to be untrue, and the person to whom it is made has no knowledge of its untruth, but relied on such statement as true, and acted upon the same and was injured thereby, then the person making such statement is liable for the damages accruing to the party thus acting. This, it is urged, is an incorrect statement of the rule of law applicable to cases of this character. The right of one damaged by the false representations of another, made with intent to deceive, and known to be false, to have his action on the case for deceit, notwithstanding the offender was not benefited by the deceit, and did not collude with the person benefited, must be regarded as established. The leading case upon this subject is Pasley v. Freeman, 3 Term Rep. 51. It is also found in 2 Smith’s Leading Cases, part 1, page *66, to which is added an extended note, wherein all the English and American cases are grouped, and to which particular reference is made. The principle was first adopted and announced by this court in Weatherford v. Fishback, 3 Scam. 170, on the authority of the leading case of Pasley v. Freeman, and Upton v. Vail, 6 Johns. 181, Barney v. Dewey, 13 id. 224, Young v. Covell, 8 id. 23, Foster v. Charles, 6 Bing. 396, and Corbett v. Brown, 8 id. 33. And it was there said: “The fraud and the scienter, though the party had no personal interest in practicing it, seem to constitute the ground of the action,—the gravamen being the deceit, and the scienter the gist of the action.” The same principle has been recognized in Eames v. Morgan, 37 Ill. 260, Wheeler v. Randall, 48 id. 182, Hiner v. Richter, 51 id. 299, Merwin v. Arbuckle, 81 id. 501, and other cases. In discussing this instruction, the Appellate Court aptly said: “The ground of action is fraud and damage. There must be scienter, a misrepresentation, and a consequent loss. Fraud includes an intention to deceive. If there is no such intention, the party honestly giving his own opinion, believing he is stating the truth, is not liable, though the statement be wholly untrue, Where, however, he knowingly states what is untrue, a fraudulent purpose must be inferred; and when the statement relates to the matter inquired of, and being relied on necessarily brings damage to the person so misled, he having no knowledge of its untruth, the action will lie. ” But it is urged that this instruction is fatally defective because it ignores the principle that the plaintiff, before he can recover, must exercise ordinary prudence to guard against the deception and fraud practiced upon him, unless he has been thrown off his guard by the other party,—citing Schwabacker v. Riddle, 99 Ill. 343. We can not adopt the construction sought to be placed on the Schivabacker case by counsel, nor admit its application to this case. Counsel lose sight of the marked distinction, clearly recognized by the authorities, between the representations made by the vendor to the vendee, and those made by a third party. As between vendor and vendee, the general rule is, that false assertions respecting value are not actionable, upon the principle that value is, at most, an opinion, and the antagonistic position of the parties is sufficient to put the vendee upon, his guard. The vendor may praise his property, and place a value upon it exceeding what he may know it to be worth, and try to induce its purchase on the basis of such valuation, without incurring liability as for deceit. But when he leaves the domain of judgment and opinion, and falsely asserts a fact, as, of quantity, grade, boundary, and the like, inducing reliance and action thereon by one, without knowledge of the falsehood, or the present opportunity or ability of verification, and under circumstances justifying belief, and damage results in consequence, the action will lie. The Schwabacker case was between vendor and vendee, and the representations were in respect of the amount of goods belonging to a firm, shown by an invoice and valuation by disinterested persons; and the doctrine of that case is, that under such circumstances the plaintiff must not allow himself to be blindly credulous of a fact the means •of verification of which was at hand and available to him. But the principle controlling where the relation of the parties is that of vendor and vendee, can have no application' where the representation complained of, as in this case, is made by a third party as to the character and credit of another, or asserting another’s solvency or reliability. The position of the parties is not antagonistic,—rather one of confidence. In such •case, if the material representation is knowingly falsely made to one ignorant of its falseness, under circumstances justifying a reasonably prudent man’s belief, and it is believed and acted upon with consequent injury, an action therefor will lie; and this we understand to be in harmony with the current and weight of American decisions where the doctrine of Pasley v. Freeman has been accepted. It may therefore be laid down as a general proposition, deduced from a consideration of all the authorities, that where the representations relate to a material fact within the knowledge of the person making them, or 'which he assumes to assert upon his personal knowledge, and with respect to wBich the person to whom the representations are made has not the present opportunity or ability to test or verify, the latter has a right to rely upon such representations, and in the absence of facts apparent to reasonably arouse suspicion and throw doubt upon the truth of the statements, he is not bound to go further and make inquiries in respect thereof. Applying these principles to the instruction under consideration, and in view of the facts disclosed by the evidence, the law of the case was stated with substantial accuracy. Endsley knew Kimlin’s financial condition,—knew that he Bad no money in the Kansas bank,—knew that Johns was ignorant of Kimlin’s insolvency,—and yet, by his representations, he induced Johns to part with his property and deliver its possession to him for Kimlin, and to accept a worthless check in payment therefor. Under such circumstances, Johns had a right to rely upon Endsley’s statement that the check was good, and would bS paid, and to act upon it as he did. Finding no error in the record, the judgment of the Appellate Court is affirmed. Judgment affirmed.