Loveland v. Hanson

Owen, J. The principal argument made by the appellants is that L. A. Hanson was not justified in relying upon representations made by the agent of the plaintiffs that the directors of the company had all consented to his signing the notes. An examination of .the record convinces us that this was a jury question. True, the specific question of whether L. A. Hanson was justified in relying upon such representations was not submitted to the jury. But in submitting the fourth question to the jury the trial judge said: “To be induced by a representation one must rely upon it, and a person is not justified in relying upon a false representation unless under all the circumstances it is of such a nature that a prudent man, in the transaction of his important business, is warranted in relying thereon. The false representations, to be considered as an inducement, must be of such a character and made under such circumstances that the person claimed to have been deceived was justified in relying upon them.” In view of this instruction the jury could not have answered the fourth question, “Was L. A. Hanson induced by such representations to sign the notes and contract,” in the affirmative unless it was also found that he was justified in relying upon such representations. Furthermore, by virtue of the provisions of sec. 2858m, Stats., if such fact is essential to sustain the judgment it shall be deemed to have been determined by the court in conformity with its judgment. However, we do not deem this question'very material. To hold L. A. Hanson personally liable upon the [630] notes there must be some element of deceit or fraud in that which he did, or an express or implied warranty on his part that he had authority to bind the Hanson Company. Outagamie County Bank v. Tesch, 171 Wis. 249, 177 N. W. 6, and cases there cited. The- record discloses no element of deceit or fraud on Hanson’s part, and the agent of the company was fully advised concerning his authority or lack of authority in the premises. As said by the learned trial' judge: “That L. A. Hanson had no actual authority to sign the note, is- clear. But the plaintiffs’ agent knew as well as he did that he was without such authority. And the signature, as the jury found upon sufficient evidence, was- induced by the false and fraudulent representation of the plaintiffs’ agent that he, the agent, had procurecl from all the resident directors their assent to the making of the note. It is also clear that neither the plaintiffs nor L. A. Hanson contemplated that L. A. Hanson should be personally liable. Were the law to hojd L. A. Hanson liable it would not only make a contract which the parties never contemplated, but would enable the plaintiffs to profit by the fraud of their agent. It would be a monstrous injustice, in view of the findings of the jury, for the law to do .either.” By the Court. — Judgment affirmed.