Bennett v. Judson

Bennett v. Judson. Deceit.—Pleading. If the agent of a vendor of land make material misrepresentations as to its location and qualities, assuming to have knowledge of the facts, but without express authority from his principal, the latter is responsible in damages, though neither he nor the agent had any actual knowledge upon the subject-matter of the representations. It seems, that in such case the fraud is well charged as that of the principal; at all events, the variance, being the subject of amendment, will not be regarded on appeal. Appeal from the general term of the of the Supreme Court, in the seventh district, where a verdict and judgment in favor of the plaintiff had been affirmed. This was an action in the nature of deceit; the complaint averred that the defendant, for the purpose of effecting- a sale of certain lands in Indiana and Illinois, to the plaintiff, made false and fraudulent representations as to their location and qualities; relying upon which, the plaintiff purchased. On the trial of the case, it appeared, that the sale of the lands was negotiated by one Davis, as the defendant’s agent; and that the.latter, without any personal knowledge upon the subject, made certain statements respecting their quality and location, of a very strict and positive character, clearly importing, on their face, a knowledge of the facts on the part of the agent. *The description was grossly inaccurate in particulars material to the value of the land, though neither the defendant, nor his agent, nor the person from whom the information was derived, had any personal knowledge upon the subject. The defendant requested the judge to direct a verdict in his favor, on the ground that there was no evidence of fraud on his part, nor on that of his agent; this was refused, and an exception taken. The learned .judge (Johnson, J.) submitted the question of fraud to the jury as one of fact; and charged that if the defendant's gent- had practised a fraud upon the plaintiff in making che bargain, his principal, having received the fruits of it, was liable for the fraud, though he did not authorize the statement, or know that it was made, or whether it was true or false. To this charge the defendant excepted ; and a verdict and judgment in favor of the plaintiff having been affirmed at general term, the defendant took this appeal. Soule, for the appellant. Hyde, for the respondent. [MAJORITY — Comstock, C. J.] Comstock, C. J. There is no evidence that the defendant authorized or knew of the alleged fraud committed by his agent Davis, in negotiating the exchange of lands. Nevertheless, he cannot enjoy the fruits of the bargain, without adopting all the instrumentalities employed by the agent in bringing it to a consummation. If an agent defraud the person with whom he is dealing, the principal, not having authorized or participated in the wrong, may, !no doubt, rescind, when he discovers the fraud, on the sterms of making complete restitution; but so long as he iretains the benefits of the dealing, he cannot claim immunity, on the ground that the fraud was committed *by his a^en* an<^ no* ^ himself. This is elementary doctrine, and it disposes of one of the questions raised at the trial.y The complaint, in setting forth the cause of action, counts upon false representations made by the defendant, without any reference to the agent. This mode of stating the case, we think, was proper, under any system of pleading ; the same rule of law which imputes to the principal the fraud of the agent, and makes him answerable for the consequences, justifies the allegation in pleading, that the principal himself committed the wrong. If this were otherwise, the pleading was nevertheless amendable at the trial; the allegation might have been made to conform to the proof, and where this might be properly done at the trial, it can be done, even after the judgment. This court, in such cases, never reverses a judgment, although the amendment has not been actually made. (Lounsbury v. Purdy, 18 N. Y. 515.) The question of fact litigated at the trial was, whether the representations of Davis, the agent of the defendant, concerning the western lands, were fraudulently made. The defendant claimed a nonsuit; one of the grounds of his motion being that the evidence wholly failed to show that either the agent or the principal knew that the representations were false. According to the testimony on the part of the plaintiff, certain statements were made by Davis, of a very direct and positive character, concerning the quality and advantages of the defendant’s land situated in Indiana and Illinois; these statements were so minutely descriptive of the land that on their face, they clearly imported a knowledge of the facts on the part of the person making them,and they were not materially qualified by a reference to any other person as the source of information. The evidence on the part of the defendant gave a somewhat different complexion to the case, but the question of fact was fairly submitted to the jury. The question of law was, whether the representations could bo deemed fraudulent, unless they were known to be false. In regard to this we entertain no serious doubt. Mr. Justice Stoby thus states the rule:—“ Whether a party misrepresenting a material fact know it to be false, or *make the assertion without knowing whether it were true or false, is wholly immaterial; for the affirmation of what one does not know or believe to be true is equally, in morals and law, as unjustifiable as the affirmation of what is known to be positively false.” (1 Story Eq. § 193, and see note.) In the .case before us, the representations of the defendant’s agent were proved to be grossly false, and they could not be honestly made, when lie had not the slightest knowledge of the subject to which they related. The plaintiff knew nothing of the lands which he was about to buy. If these statements as to the situation and characteristics of those lands were made with an intent that he should rely upon them, and if he did rely upon them, it ivas as much a fraud as if they were known to be untrue. Tne law is not so unreasonable as to deny redress in such a case. (Stone v. Denney, 4 Metc. 161; Buford v. Caldwell, 3 Missouri 477; Thomas v. McCann, 4 B. Monroe 601; Parham v. Randolph, 4 How. Miss. 435.) The case does not present any other questions requiring a particular consideration. We think the judgment must be affirmed. Judgment affirmed. This is a case of questionable authority. In Marsh v. Falker, 40 N. Y. 573, Grover, J., says, it was decided on the ground that the agent assumed to know, and it was proved that he did not; and thus he was shown to have been guilty of falsehood in making the statement. And Judge Hunt, in Craig v. Ward, 3 Keyes 393, says, “ this destroys the distinction between fraud and negligence, which I suppose to be well settled, and I am not prepared to reiterate it, in a case which does not require it.” And in Wakeman v. Dalley, 51 N. Y. 27, it was decided, that to sustain an action for fraud, founded upon representations made by the defendant, it must'appear that he believed, or had reason to believe, at the time he made them, that such representations were false, or that without knowledge, he assumed or intended to convey the impression that he had actual knowledge of their truth, and that the plaintiff relied upon them to his injury. The same doctrine was laid down in the case of Meyer v. Amidon, 45 N. Y. 169. And see Oberlander v. Spiess, Ibid. 175; Stitt v. Little, 66 Ibid. 427. In Weed v. Case, 55 Barb. 548, Bacon, J., says, the case of Bennett v. Judson “has always been considered to have carried the doctrine of liability for an alleged fraudulent representation to the extremest verge of the law, and the courts have been very careful to discriminate and apply it only to the state of facts presented by the case itself.” The case of Sharp v. New York, 40 Barb 256, was, however, ruled on its authority.