rule is specially and peculiarly applicable where the party making the representations is the other's own attorney.78 And again, aside from such a relationship, if one of the parties is ignorant of the law or of his legal position and rights, and the other is aware of this fact, and is also perfectly informed of the legal principles, rules, or statutes applicable to the existing state of affairs, and takes advantage of his superior knowledge and of the other's ignorance, and so misrepresents and misstates the law as to induce him to enter into an inequitable bargain, or to part with rights or property which he might have retained, it is considered such fraud as to justify a court of equity in giving relief."

Aside from such exceptional cases, it is generally considered that it is not an actionable fraud to mislead a person as to the nature or strength of his title to property, or to assert that an adverse claimant has a better title, as these are matters of law and as one is presumed to be informed on such points.75 Particularly in regard to tax titles, the rule appears to be that, if land has actually been sold for taxes, it is not fraudulent to represent to the owner that his title has been divested by the sale, unless, perhaps, where such representation is accompanied by other statements, which are false, and which relate to matters of fact, as, for instance, in regard to the time of the sale, the issuance of a tax deed, the running of the statute of limitations, or similar matters.76 Likewise it is held that a statement in regard to the legal effect of a contract, deed, lease, or other

Ky. Law Rep. 1033, 96 S. W. 840; Spurrier v. McClintock, 104 Iowa, 79, 73 N. W. 599. For the general rules as to cases of frauds committed by persons in positions of trust or confidence, and as to the various relations which are considered as fiduciary or confidential, see, supra, §§ 40-51.

73 Altgelt v. Gerbic (Tex. Civ. App.) 149 S. W. 233.

74 Busiere v. Reilly, 189 Mass. 518, 75 N. E. 958; Ward v. Baker (Tex. Civ. App.) 135 S. W. 620; Schuttler v. Brandfass, 41 W. Va. 201, 23 S. E. 808; Lehman v. Shackleford, 50 Ala. 437; Headley v. Pickering, 23 Ky. Law Rep. 905, 64 S. W. 527. See Hicks v. Deemer, 187 Ill. 164, 58 N. E. 252.

75 Driver v. White (Tenn. Ch. App.) 51 S. W. 994.

76 De St. Laurent v. Slater, 19 Misc. Rep. 197, 43 N. Y. Supp. 63. And see Kathan v. Comstock, 140 Wis. 427, 122 N. W. 1044, 28 L. R. A. (N. S.) 201; Squires v. Higginson, 50 Wash. 364, 97 Pac. 240.

instrument, or the legal rights and legal duties of the parties under it, is not a fraudulent misrepresentation justifying relief in equity, however false, since it relates to matter of law and not to matter of fact." But the purport or legal effect of an instrument is a different thing from its contents. What legal rights it creates is a question of law, but what terms or conditions it contains is a matter of fact. Hence a false representation that a deed does not convey or affect a certain piece of property is not an opinion or a statement of law, but an assertion in regard to a fact, and therefore may lay the foundation for a cancellation of the deed.78 For similar reasons it is held that a representation to the effect that an obligation is unpaid and in full force and effect, though in reality it is barred by the statute of limitations, is a representation of fact, rather than of law, and may give ground for relief." But to tell a person that he has no cause of action (in respect to a particular case) or that the law is such that he could not recover in a suit which he threatens or intends to bring, and thereby to induce him to accept a compromise or settlement, is not such fraud as will avoid a receipt or release given by him.80 Thus, where an agent of an insurance company makes representations to one having a claim for a loss against the company (the parties standing in antagonistic relations to each other, and not in any confidential or even friendly relation) to the effect that the claim is not such as could be enforced by any legal proceedings, on account of certain alleged violations of the conditions of the policy, such representations are only statements of opinion, and moreover, opinion upon a question of law, and the claimant has no right to rely upon them, and if he does rely upon them it

77 Tradesman Co. v. Superior Mfg. Co., 147 Mich. 702, 111 N. W. 343, 112 N. W. 708; Gipe v. Pittsburgh, C. C. & St. L. Ry. Co., 41 Ind. App. 156, 82 N. E. 471; Du Moulin v. Board of Education of City of New York (Sup.) 124 N. Y. Supp. 901. See Busiere v. Reilly, 189 Mass. 518, 75 N. E. 958.

78 Dashiel v. Harshman, 113 Iowa, 283, 85 N. W. 85. And see, supra, § 56.

79 Brown v. Rice, 26 Grat. (Va.) 467.

80 Valley v. Boston & M. R. Co., 103 Me. 106, 68 Atl. 635; Johnson v. Chicago, R. I. & P. R. Co., 107 Iowa, 1, 77 N. W. 476.

BLACK RESC.-12

is at his own risk.81 So also, representations as to the scope and effect of a copyright, or as to the advantages or immunities which it confers upon the owner, are expressions of opinion, and, if wrong, constitute a mistake of law which will not justify the rescission of a contract.82 And so, in an action on a contract for the production of a play, fraud on the part of the plaintiff is not shown by proving that he asserted (in good faith) that he had the exclusive right to produce such play in England, when in fact the play was public property, such statement being merely an expression of opinion on a difficult question of law.83 Again, a subscriber to, or purchaser of, corporate stock has no right to rely on representations as to matters of law, made to induce his subscription or purchase, and cannot rescind it because he was misled or deceived as to his liability in the capacity of a stockholder or the assessability of his stock, or as to the proportion of the face value that would be called for, or as to the time when payment would be demanded. And a representation that a corporation has legal power to issue certain securities, made to an intending lender, but which proves to be incorrect, will not entitle the lender to relief on the ground of fraud.85

84

The validity of a lien is generally a question of law, which a person dealing with the property affected must determine for himself, without relying on representations made to him.88 But whether any lien exists, whether the necessary steps have been taken to perfect it, or whether it is a first or prior lien or is subordinate to others, are generally questions of fact, in the sense that they depend upon the existence of ascertainable facts rather than upon the application of legal principles to given facts, and false in

81 Etna Ins. Co. v. Reed, 33 Ohio St. 283.

82 Burk v. Johnson, 146 Fed. 209, 76 C. C. A. 567.

83 Brady v. Edwards, 35 Misc. Rep. 435, 71 N. Y. Supp. 972. 84 Upton v. Tribilcock, 91 U. S. 45, 23 L. Ed. 203; Parker v. Thomas, 19 Ind. 213, 81 Am. Dec. 385; Clem v. Newcastle & D. R. Co., 9 Ind. 488, 68 Am. Dec. 653; Rogan v. Illinois Trust & Sav. Bank, 93 Ill. App. 39. Compare Browne v. San Gabriel River Rock Co., 22 Cal. App. 682, 136 Pac. 542, 544. See Vick v. Park (Tex. Civ. App.) 173 S. W. 989.

85 Rashdall v. Ford, L. R. 2 Eq. Cas. 750.

86 Banner v. Rosser, 96 Va. 238, 31 S. E. 67.

formation on these points, fraudulently given, may afford ground for relief.87 And so, false and fraudulent statements which incidentally refer to the sale of real estate, and to the rights of a person under a bid therefor at sheriff's sale, by means of which money is procured from another, are actionable to the extent of the injuries sustained.88 And in an action on a note given to a bank, it is a good defense that the bank represented to defendant that it had acquired some of its own stock, which it could not legally hold, and which must be formally issued, and desired defendant to take the stock temporarily and give his note, until the stock could be sold to an actual purchaser, which he did as an accommodation to the bank. So, a charge of fraud against executors is not sustained by showing that they had represented that a certain decree "is now in full force and effect and no appeal has been taken therefrom," when in fact, previous to the making of such representation, a writ of error had been sued out to review such decree, such writ not having been made a supersedeas."

89

§ 72. Same; Law of Another State.-When the legal rights and duties of a party, or the legal effect of any contract or transaction into which he enters, are dependent upon the laws of a foreign state or country, he is not presumed to have any information thereon, nor required to exercise diligence to inform himself. And if representations as to the existence, terms, or effect of such laws are made to him by the other party, assuming to know them and to advise him concerning them, whereby he is induced to part with his rights or to enter into the contract, they are considered as representations of fact, and not of law, and will justify the rescission of the contract or cancellation of the obligation, if false and made with a fraudulent intention. This rule applies not merely to questions of

91

87 Texas Cotton Products Co. v. Denny Bros. (Tex. Civ. App.) 78 S. W. 557; Kehl v. Abram, 210 Ill. 218, 71 N. E. 347, 102 Am. St. Rep. 158; Hill v. Coates, 127 Ill. App. 196; Gillette v. Anderson, 85 Wash. 81, 147 Pac. 634.

88 Newell v. Long-Bell Lumber Co., 14 Okl. 185, 78 Pac. 104.

89 Shuey v. Holmes, 20 Wash. 13, 54 Pac. 540.

90 Fraser v. Fraser, 149 Ill. App. 186.

1 Upton v. Englehart, 3 Dill. 496, Fed. Cas. No. 16,800; Bethell v.

law affecting the title to land in another state,92 but to such matters as, for instance, the statute of limitations of a foreign state.98 And where one is induced to subscribe for stock in a corporation of another state, representations made to him as to the law of that other state, in respect to the responsibility of stockholders and the like, are statements of fact, and, if false, will release him from his subscription."

§ 73. Representations Not Contemporary with Making of Contract. When the making of a contract has been definitely completed, so that rights and duties under it have become vested, representations concerning the subjectmatter afterwards made by one of the parties to the other furnish no ground for relief against the contract, however false and fraudulent, as, for instance, when they are made to disarm his suspicions or prevent an investigation, to make him feel pleased with his bargain or stop him from repudiating it.95 It has been said, indeed, that a misrepresentation in a contract which will entitle the party misled to a rescission must have been made at the very time of making the contract and as a part of the same transaction.96 This rule is perhaps too strict. But at any rate it is clear that the falsity of a representation made to a party on a former occasion and for a different purpose cannot be Bethell, 92 Ind. 318; Travelers' Protective Ass'n v. Smith (Ind.) 101 N. E. 817; Schneider v. Schneider, 125 Iowa, 1, 98 N. W. 159; Epp v. Hinton, 91 Kan. 513, 138 Pac. 576, L. R. A. 1915A, 675; Wood v. Roeder, 50 Neb. 476, 70 N. W. 21; Busch v. Busch, 12 Daly (N. Y.) 476; Anderson v. Heasley, 95 Kan. 572, 148 Pac. 738. 92 Schneider v. Schneider, 125 Iowa, 1, 98 N. W. 159. 93 Wood v. Roeder, 50 Neb. 476, 70 N. W. 21.

94 Upton v. Englehart, 3 Dill. 496, Fed. Cas. No. 16,800.

95 Belding v. King, 159 Fed. 411, 86 C. C. A. 391; Clayton v. Cavender, 1 Marv. (Del.) 191, 40 Atl. 956; Meriweather v. Herran, 8 B. Mon. (Ky.) 162; Soule v. Harrington, 135 Mich. 155, 97 N. W. 357; Moore v. Hinsdale, 77 Mo. App. 217; Schelling v. Bischoff, 59 N. Y. Super. Ct. 562, 13 N. Y. Supp. 600; Willets v. Poor, 141 App. Div. 743, 126 N. Y. Supp. 926; Hart v. Walsh, 84 Misc. Rep. 421, 146 N. Y. Supp. 235; McNeile v. Cridland, 6 Pa. Super. Ct. 428; Campbell v. Rushing (Tex. Civ. App.) 141 S. W. 133; Louis F. Fromer & Co. v. Stanley, 95 Wis. 56, 69 N. W. 820.

96 Barnett v. Barnett, 83 Va. 504, 2 S. E. 733; Bostwick v. Mutual Life Ins. Co., 116 Wis. 392, 89 N. W. 538, 92 N. W. 246, 67 L. R. A. 705. See Chilson v. Houston, 9 N. D. 498, 84 N. W. 354.