"Fraud does not consist in mere intention, but in intention carried out by hurtful acts. It consists of conduct that operates prejudicially on the rights of others."1

To determine whether the representations were material, every case is to be examined on its own facts. A slight difference in the circumstances may arrange cases apparently alike under different principles. Thus, though a false assertion of an opinion is no fraud, yet to assert that a certain piece of land, bordering on or near a river, when a certain levee was [*497] repaired would be free from overflow, except that in very

high and long continued floods a few acres of the lowest land would be overflowed, may be a fraud, if made to a stranger by one whose familiarity with the lands in former seasons must have convinced him that the opinion he was expressing was baseless." So to misrepresent the crops raised the previous year on a farm which is sold, or the amount of business done at a certain stand, is material, as these facts have a bearing on the question of value.

Deceiving Third Persons. An action cannot, in general, be maintained for inducing a third person to break his contract with the plaintiff; the consequence, after all, being only a broken contract, for which the party to the contract may have his remedy by suing upon it. But if the third person was induced to break his contract by deception, it may be different. If, for example, one were to personate a vendee of goods, and receive and pay for them as on a sale to himself, the vendee would have his action.

So a statement that all purchasers of stock had paid par when in fact they had paid but one third of that amount. Coolidge. Goddard, 77 Me. 578. Representation that horse is not afraid of the cars may be material. Allen v. Truesdell, 135 Mass. 75.

WILLIAMS, J., in Williams v. Davis, 69 Penn. St. 21, 28, citing Bunn v. Ahl, 29 Penn. St. 390. And, see Fuller v. Hodgdon, 25 Me. 243; Sieveking o. Litzler, 31 Ind. 13; Halls v. Thompson, 10 Miss. 443; Ayrs v. Mitchell, 11 Miss. 683; Coon v. Atwell, 46 N. H. 510.

Estell . Myers, 54 Miss. 174; a valuable case.

3 Martin v. Jordan, 60 Me. 531. So misrepresentations as to quantity of crop, quality of hay, number of rocks, amount of pasturage. Messer v. Smyth, 59 N. H. 41; Rhoda v. Annis, 75 Me. 17.

4 Taylor v. Green, 8 C. & P. 316. 5 Kimball v. Harman, 34 Md. 407; S. C. 6 Am. Rep. 340. To induce one to break a contract if there is neither malice or fraud, is not actionable. McCann v. Wolff, 28 Mo. App. 447.

against the vendor; but he might also pursue the party who, by deceiving one, had defrauded both.' And where the performance of a contract is prevented by deceiving the party about to make it, it is immaterial that the contract was not binding under the Statute of Frauds, because not in writing; the defect being one the party had a right to waive.'

Knowledge by the Wrong-doer of the Falsity. It is often said that, in order to render false representations fraudulent in

law, it must be made to appear that the party making [*498] them knew *at the time that they were untrue. But

this rule has so many exceptions that it is difficult to affirm, with any confidence, that it is a general rule at all. It is certain that courts of equity do not limit their action to it in giving relief, when representations prove to be untrue in fact. Says Mr. Justice STORY: "Whether the party thus misrepresent ing a material fact knew it to be false, or made 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; and even if the party innocently misrepresents a material fact by mistake, it is equally conclusive, for it operates as a surprise and imposition upon the other party." ." Accordingly, where either of the two parties to a negotiation for the purchase of property makes material representations of matters which he avers or assumes to be within his own knowledge, with intent that the other party shall act upon them, and these representations are actually relied upon by the other party in completing the negotiation, and they prove to be false, to his injury, a court of equity will treat the

1 Where one was induced to break his contract for the delivery of certain property to the plaintiff, by the false and malicious setting up by defendant of an unfounded lien thereon, an action was sustained for this deception. Green v. Button, 2 C. M. & R. 707. But for merely setting up a false claim against the plaintiff's debtor, or making a fraudulent levy on his property, no action will lie.

Smith . Blake, 1 Day, 258; Green .
Kimble, 6 Blackf. 552.

2 Benton . Pratt, 2 Wend. 385; Rice v. Manley, 66 N. Y. 82; S. C. 23 Am. Rep. 30. This case distinguishes Dung v. Parker, 52 N. Y. 494, in which it was held that no action would lie against one who, falsely pretending authority as agent, induced another to accept a void lease from him.

3 Story Eq. Juris. § 193.

case as one of fraud, and give the proper relief, although the party making the representations was not aware at the time of their falsity.'

No doubt, however, there is some difference in the aspect which such a case presents in a court of equity [*499] and in a court of law, growing out of the difference in jurisdiction in the two courts and in the modes of giving relief. A court of equity gives relief from unconscionable contracts on the ground of mistake as well as of fraud, and if the facts are set out which are supposed to show fraud, it may happen that, though they do not fully establish this, they at least show that the complainant has acted to his prejudice under such a mistake of fact as shall justify the court in giving him relief. In a court of law, on the other hand, when the plaintiff counts upon a fraud, he must establish it by his evidence; and if he fails in doing so, he must go out of court, even though it is manifest that upon the facts he is entitled to substantial redress in another forum.

Where one, in selling personal property, makes positive representations of material facts, upon which the other relics, the vendor is held to the truth of these representations, in a suit at law, as much as he would have been in a suit in equity. But this is upon the ground that they constitute a warranty. It is familiar law, that no particular form of words is necessary to

1

Thompson v. Lee, 31 Ala. 292; Iulianapolis, &c., R. R. Co. v. Tyng, 63 N. Y. 653; Foard v. McComb, 12 Bush, 723; Elder . Allison, 45 Geo. 13; Bankhead v. Alloway, 6 Cold. 56; Converse v. Blumrich, 14 Mich. 109; Bristol. Braidwood, 28 Mich. 191; Wilcox. Iowa Wes. Univ., 32 Iowa, 367; Twitchell . Bridge, 42 Vt. 68; Frenzel v. Miller, 37 Ind. 1. Where the representations relate to facts which must be supposed within defendant's knowledge, proof of their falsity is a sufficient showing of his knowledge that they were false. Morse v. Dearborn, 109 Mass. 593; Morgan . Skiddy, 62 N. Y. 319.

Any misrepresentation not an expression of opinion, by a person confided in, in relation to a material

matter constituting an inducement or motive to the act of another, by which an undue advantage is taken of him, though innocently made, and in belief of its truth, is regarded as a fraud, relievable in equity. Davis v. Heard, 44 Miss. 50; Rimer. Dugan, 39 Miss. 477.

A party selling property is presumed to know whether the repre sentation he makes of it is true or false; if he know it to be false, it is a positive fraud. If he does not know it to be true, it is culpable neg. ligence, which in equity amounts to fraud. Miner v. Medbury, 6 Wis. 295; Smith v. Richards, 13 Peters, 26; McFerran v. Taylor, 3 Cranch, 270; Glasscock v. Minor, 11 Mo. 655.

charge a vendor with a warranty. The word warrant, or any equivalent expression, need not be used. It is enough that there be a positive assertion respecting something that affects the value of that which is sold, and which is not intended as a mere expression or statement of opinion, but as an affirmation upon which the purchaser may rely, and upon which he does rely. On the other hand, if what is asserted be matter of opinion or fancy merely, such as the value of a horse, or the relative convenience and usefulness of competing articles of machinery, or the like, there is no warranty,' unless the vendor assumed the peculiar knowledge of an expert, which enabled him to judge of such matters when the other could not.' But such a warranty,

although the facts prove to be different from what they [*500] were *asserted to be, is not necessarily a fraud, any more

than is a warranty in a conveyance of lands, which proves to be broken as soon as made. Indeed, there is no necessary assumption, when one takes a warranty for his own protection, that the facts are as the covenant or promise of warranty asserts. He takes it on the understanding merely that, if they are otherwise, the warrantor will protect him. Therefore, on a broken warranty, the action is on the contract, and does not assume a tort has been committed.

Nevertheless, a warranty may be a fraud, because it may be made with knowledge that the facts asserted are untrue, and with intent to deceive by the false statement. Therefore, if one sells a horse which he avers is sound, when it is not, there is upon these facts only a warranty; but if he knows the horse is unsound, and nevertheless sells it with the like positive assertion that it is sound, this is a false warranty, and the scienter makes it a fraud.

Carondelet Iron works v. Moore, 78 Ill. 65; Wheeler v. Reed, 36 Ill. 81; Hawkins v. Pemberton, 51 N. Y. 198; Chapman o. Murch, 19 Johns. 290; Duffee v. Mason, 8 Cow. 25; Hillman v. Wilcox, 30 Me. 170; Morrill v. Wallace, 9 N. H. 111; Beebe v. Knapp, 28 Mich. 53; Stone v. Covell, 29 Mich. 359; Richardson v. Mason, 53 Barb. 601; Burge v. Stroberg, 42 Geo. 88; Tewkesbury . Bennett, 31

Iowa 83; Henshaw . Robins, 9 Met. 83; McGregor . Penn, 9 Yerg 74; McLennan. Ohmen, 17 Pac. Rep. 687 (Cal.)

2 Reed v. Hastings, 61 I. 266; Hawkins. Pemberton, 51 N. Y.

198.

3 Picard v. McCormick, 11 Mich. 68.

"Cunningham v. Smith, 19 Grat. 255; Frenzel v. Miller, 37 Ind. 1;

There is no doubt that an action on the case will lie, founded on representations made by the defendant, whenever it can be made to appear that he believed or had reason to believe the representations were false, and that the plaintiff relied upon them, to his injury. But the question is, whether this remedy is confined to cases in which the defendant knew or had reason to believe he was deceiving by untruths; and it is certain, we think, that it is not. There are numerous cases in which it has been held that if a person makes a material representation in relation to a matter susceptible of knowledge, in such a manner as to import positive knowledge, but conscious that he has no knowledge of its truth or falsity, with intent that another should rely upon such representation, this is sufficient to establish against him a legal fraud, if the other does rely upon it and it proves untrue. The *fraud here consists in the reck- [*501] less assertion that that is true of which the party knows nothing, and in deceiving the other party thereby; and even the actual belief of the party in the truth of what he asserts is immaterial, unless he had some apparently good reason for

Stitt v. Little, 63 N. Y. 427; Brown v. Castles, 11 Cush. 348; Stone v. Covell, 29 Mich. 360. In an action of tort on a false warranty the scienter need not be averred or proved. Shippen . Bowen, 122 U. S. 575; Carter v. Glass, 44 Mich. 154. Counts for deceit may be joined and recovery had on the false warranty or on the deceit. Schuchardt. Allens, 1 Wall, 359; Shippen v. Bowen, supra.

'Pasley Freeman, 3 T. R. 51; Tryon v. Whitmarsh, 1 Met. 1; Medbury. Watson, 6 Met. 246;: Hartford Ins. Co. v. Matthews, 102 Mass. 221; Cross v. Peters, 1 Me. 378; Oberlander o. Spiess, 45 N. Y. 175; Griswold

. Sabine, 51 N. H. 167; S. C. 12 Am. Rep. 76; Nauman v. Oberle, 90 Mo. 666. In such case the intent to deceive is conclusively presumed. Hudnut o. Gardner, 59 Mich. 341; Cowley . Smyth, 46 N. J. L. 380.

* Monroe v. Pritchett, 16 Ala. 785; Hazard v. Irwin, 18 Pick. 95; Page v.

Bent, 2 Met. 371; Stone v. Denny, 4 Met. 151; Fisher v. Mellen, 103 Mass. 503; Litchfield . Hutchinson, 117 Mass. 195; Bennett v. Judson, 21 N. Y. 238; Meyer v. Amidon, 45 N. Y. 169; Wakeman v. Dalley, 51 N. Y. 27; McDonald v. Trafton, 15 Me. 225; Hammatt v. Emerson, 27 Me. 308; Frenzel . Miller, 37 Ind. 1; West v. Wright, 98 Ind. 335; Cole v. Cassidy, 138 Mass. 437; Hanger v. Evins, 38 Ark. 334; Brown v. Freeman, 79 Ala. 406; Caldwell v. Henry, 76 Mo. 254; Anstee . Ober, 26 Mo. App. 665; Nauman v. Oberle, 90 Mo. 666.

3 Taylor. Ashton, 11 M. & W. 401; Beebe v. Knapp, 28 Mich. 53, 76; Indianapolis, &c., R. R. Co. v. Tyng, 63 N. Y. 653; Einstein v. Marshall, 58 Ala. 153.

Allen v. Hart, 72 Ill. 104; Cabot v. Christie, 42 Vt. 121; Fisher v. Mellen, 103 Mass. 503; Litchfield v. Hutchinson, 117 Mass. 195; Cole v. Cassidy, 138 Mass. 437. If one ought to have