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person may be guilty of fraud by stating that he knows a thing to be so, when he only believes it to be so. A representation of a fact, as of the party's own knowledge, and which proves false, is, unless explained, inferred to be willfully false and made with an intent to deceive at least in respect to the knowledge professed.481 This rule has been stated with careful precision by the Supreme Court of Wisconsin as follows: If one in negotiating with another in contractual matters makes a misrepresentation

Kock, 159 Iowa, 343, 140 N. W. 220; Farnsworth v. Muscatine Produce & Pure Ice Co., 161 Iowa, 170, 141 N. W. 940; Driver v. Hunt, 2 Ky. Law Rep. 435; Shackelford v. Hendley, 1 A. K. Marsh. (Ky.) 496, 10 Am. Dec. 753; Taymon v. Mitchell, 1 Md. Ch. 496; Ginn v. Almy, 212 Mass. 486, 99 N. E. 276; Fisher v. Mellen, 103 Mass. 503; Converse v. Blumrich, 14 Mich. 109, 90 Am. Dec. 230; Hubbard v. Oliver, 173 Mich. 337, 139 N. W. 77; Steinbach v. Hill, 25 Mich. 78; Jones v. Wing, Har. (Mich.) 301; Brooks v. Hamilton, 15 Minn. 26 (Gil. 10); Freeman v. F. P. Harbaugh Co., 114 Minn. 283, 130 N. W. 1110; Yeater v. Hines, 24 Mo. App. 619; Florida v. Morrison, 44 Mo. App. 529; Milan Bank v. Richmond, 235 Mo. 532, 139 S. W. 352; Peters v. Lohman, 171 Mo. App. 465, 156 S. W. 783; Field v. Morse, 54 Neb. 789, 75 N. W. 58; Faulkner v. Wassmer, 77 N. J. Eq. 537, 77 Atl. 341, 30 L. R. A. (N. S.) 872; Hammond v. Pennock, 61 N. Y. 145; Carr v. National Bank & Loan Co., 167 N. Y. 379, 60 N. E. 649, 82 Am. St. Rep. 725; Alker v. Alker (Sup.) 12 N. Y. Supp. 676; Farjeon v. Indian Territory Illuminating Oil Co. (Sup.) 120 N. Y. Supp. 298; Hunt v. Moore, 2 Pa. 105; Lewis v. McLemore, 10 Yerg. (Tenn.) 206; Beatty v. Bulger, 28 Tex. Civ. App. 117, 66 S. W. 893; McCord-Collins Commerce Co. v. Levi, 21 Tex. Civ.' App. 109, 50 S. W. 606; Cabaness v. Holland, 19 Tex. Civ. App. 383, 47 S. W. 379; Jesse French Piano & Organ Co. v. Nolan, 38 Tex. Civ. App. 395, 85 S. W. 821; Harris v. Shear (Tex. Civ. App.) 177 S. W. 136; Ross-Armstrong Co. v. Shaw (Tex. Civ. App.) 113 S. W. 558; Haldeman v. Chambers, 19 Tex. 1; Ogden Valley Trout & Resort Co. v. Lewis, 41 Utah, 183, 125 Pac. 687; Smith v. Columbus Buggy Co., 40 Utah, 580, 123 Pac. 580; Grim v. Byrd, 32 Grat. (Va.) 293; Wren v. Moncure, 95 Va. 369, 28 S. E. 588; Linhart v. Foreman, 77 Va. 540: McMullin v. Sanders, 79 Va. 356; Taylor v. Ashton, 11 Mees. & W. 415. Some scattering expressions of opinion contrary to the rule stated in the text may be found in the reports. See, for instance, Walker v. Hough, 59 Ill. 375; Faver v. Bowers (Tex. Civ. App.) 33 S. W. 131; Jasper v. Hamilton, 3 Dana (Ky.) 280; Proctor v. Spratley, 78 Va. 254; Becker v. Colonial Life Ins. Co., 153 App. Div. 382, 138 N. Y. Supp. 491; Dumas v. Ware, 143 Ga. 212, 84 S. E. 538; Krankowski v. Knapp, 268 Ill. 183, 108 N. E. 1006.

481 Cabot v. Christie, 42 Vt. 121, 1 Am. Rep. 313; Darling v. Stuart, 63 Vt. 570, 22 Atl. 634.

of fact, material to the transaction, to induce the other to act thereon, and such other reasonably does so act, to his prejudice, he may avoid the result on the ground of fraud, actual or constructive, and may have the aid of equity to that end, and it is not a sufficient answer to his claim for the person making the representations to say that he did so honestly, since it is his duty to know whereof he speaks, or not to speak at all as of his knowledge.482 This rule has also been enacted by statute in Georgia, where it is provided that "fraud may exist by misrepresentation by either party, made with design to deceive, or which does actually deceive, the other party; and in the latter case such misrepresentation voids the sale, though the party making was not aware that his statement was false." 9483 But it is said that the rule does not apply in the case of a sale which comes within the rule or doctrine of caveat emptor, that is, where no warranty is given either expressly or by implication, where the purchaser has full opportunity for inspection and is bound to be vigilant in his own interest, and where, consequently, he has no legal right to rely on any representations made to him.484

§ 103. Same; Falsity in Express or Implied Assertion of Knowledge.-In the contemplation of equity, he who makes a representation as of his own knowledge, without knowing whether it is true or false, whereas it is actually untrue, is guilty of fraud as much as if he knew it to be untrue. In such a case he acts falsely, to his own knowledge, and the law imputes a fraudulent intent.485 The affirmation of what one does not know or believe to be true is equally, in morals and in law, as unjustifiable as the affirmation of what is known to be positively false. 486 Hence we have the rule that a person who makes repre

482 Kathan v. Comstock, 140 Wis. 427, 122 N. W. 1044, 28 L. R. A. (N. S.) 201. But representations by a vendor as to the value of land, which he expressly states he has never seen, cannot be deemed fraudulent. Bunck v. McAulay, 84 Wash. 473, 147 Pac. 33. 488 Civ. Code Ga. 1910, § 4113.

484 Dorsey v. Watkins (C. C.) 151 Fed. 340.

485 Stimson v. Helps, 9 Colo. 33, 10 Pac. 290.

486 Crislip v. Cain, 19 W. Va. 438; Tolley v. Poteet, 62 W. Va. 231, 57 S. E. 811.

sentations concerning a material fact which is of such a nature as to be susceptible of definite knowledge, and asserts it to be true to his personal knowledge (as distinguished from his belief or opinion), when he does not know whether it is true or not, is guilty of falsehood if the assertion is actually untrue, being conscious of his want of knowledge, even though he supposes or believes it to be true. And if the representations are thus made with the intention that they shall be accepted and acted on by another, who does so act to his prejudice, and the party making the representations secures an undue advantage thereby, it is an actionable fraud, and the party is subject to the same liabilities as if the representations had been made with full knowledge of their falsity.187 As

487 Shahan v. Brown, 167 Ala. 534, 52 South. 737; Hutchinson v. Gorman, 71 Ark. 305, 73 S. W. 793; Browning v. National Capital Bank, 13 App. D. C. 1; Upchurch v. Mizell, 50 Fla. 456, 40 South. 29; Miller v. John, 208 Ill. 173, 70 N. E. 27; Ames v. Thren, 125 Ill. App. 312; Crane v. Schaefer, 140 Ill. App. 647; Snively v. Meixsell, 97 Ill. App. 365; John Gund Brewing Co. v. Peterson, 130 Iowa, 301, 106 N. W. 741; Davis v. Central Land Co., 162 Iowa, 269, 143 N. W. 1073, 49 L. R. A. (N. S.) 1219; Haigh v. White Way Laundry Co., 164 Iowa, 143, 145 N. W. 473, 50 L. R. A. (N. S.) 1091; Hanson v. Kline, 136 Iowa, 101, 113 N. W. 504; Ballard v. Thibodeau, 109 Me. 559, 84 Atl. 412; Braley v. Powers, 92 Me. 203, 42 Atl. 362; Litchfield v. Hutchinson, 117 Mass. 195; Adams v. Collins, 196 Mass. 422, 82 N. E. 498; Weeks v. Currier, 172 Mass. 53, 51 N. E. 416; Wann v. Northwestern Trust Co., 120 Minn. 493, 139 N. W. 1061; Flaherty v. Till, 119 Minn. 191, 137 N. W. 815; Riggs v. Thorpe, 67 Minn. 217, 69 N. W. 891; Vincent v. Corbett, 94 Miss. 46, 47 South. 641, 21 L. R. A. (N. S.) 85; Western Cattle Brokerage Co. v. Gates, 190 Mo. 391, 89 S. W. 382; Chase v. Rusk, 90 Mo. App. 25; Paretti v. Rebenack, 81 Mo. App. 494; Miller v. Rankin, 136 Mo. App. 426, 117 S. W. 641; Leach v. Bond, 129 Mo. App. 315, 108 S. W. 596; Stark Brothers Nurseries & Orchards Co. v. Mayhew, 160 Mo. App. 60, 141 S. W. 433; Crosby v. Wells, 73 N. J. Law, 790, 67 Atl. 295; Thompson v. Koewing, 79 N. J. Law, 246, 75 Atl. 752; Hadcock v. Osmer, 153 N. Y. 604, 47 N. E. 923; Frank v. Bradley & Currier Co., 42 App. Div. 178, 58 N. Y. Supp. 1032; Lambert v. Elmendorf, 124 App. Div. 758, 109 N. Y. Supp. 574; Schoeneman v. Chamberlin, 55 App. Div. 351, 67 N. Y. Supp. 284; Kramer v. Bjerrum, 19 App. Div. 332, 46 N. Y. Supp. 496; Prahar v. Tousey, 93 App. Div. 507, 87 N. Y. Supp. 845; Modlin v. Roanoke R. & Lumber Co., 145 N. C. 218, 58 S. E. 1075; Pate v. Blades, 163 N. C. 267, 79 S. E. 608; Bonelli v. Burton, 61 Or. 429, 123 Pac. 37; Thompson v. Chambers, 13 Pa. Super. Ct. 213; United States Gypsum Co. v. Shields (Tex. Civ. App.) 106 S. W. 724; Gibbens v. Bourland (Tex. Civ. App.) 145 S. W. 274; Goodwin v. Daniel

stated in one of the cases: "If a man, having no knowledge whatever upon the subject, takes upon himself to represent a certain state of facts to exist, he does so at his peril; and if it be done either with a view to secure some benefit to himself, or to deceive a third person, he is in law guilty of a fraud, for he takes upon himself to warrant his own belief of the truth of that which he asserts.'

99 488

The foregoing rule is a rule applicable at law, and not only in equity. It is enforced in actions for damages for deceit or fraud. But since, as stated in the preceding section, scienter is a necessary part of the proof in actions of this kind, whereas it is not so in suits in equity for rescission, it is evident that the case of representations made as of a party's own knowledge, when he is ignorant of the facts, must furnish an even stronger ground for rescission than for an action of deceit. And it is so held.48.9 It will be observed that the falsehood in a case of this kind consists in the assertion that the party possesses knowledge which he does not in fact possess. And this need not be an explicit assertion or affirmation that the party speaks from his own knowledge, but may follow as a necessary inference from the form in which he makes his statement. An unqualified statement that a fact exists, made by one to induce another to act on it, implies that the former knows it to exist and speaks from his own knowledge.* 490 (Tex. Civ. App.) 93 S. W. 534; Benton v. Kuykendall (Tex. Civ. App.) 160 S. W. 438; Grant v. Huschke, 74 Wash. 257, 133 Pac. 447; Arrowsmith v. Nelson, 73 Wash. 658, 132 Pac. 743; Dickinson v. Chesapeake & O. R. Co., 7 W. Va. 390; James v. Piggott, 70 W. Va. 435, 74 S. E. 667; Krause v. Busacker, 105 Wis. 350, 81 N. W. 406; Helberg v. Hosmer, 143 Wis. 620, 128 N. W. 439. Compare Bradley v. Oviatt, 86 Conn. 63, 84 Atl. 321, 42 L. R. A. (N. S.) 828; People's Nat. Bank v. Central Trust Co., 179 Mo. 648, 78 S. W. 618. See O'Neill v. Conway, 88 Conn. 651, 92 Atl. 425; Wheatcraft v. Myers, 57 Ind. App. 371, 107 N. E. 81; Bloomquist v. Farson, 88 Misc. Rep. 615, 151 N. Y. Supp. 356; First Nat. Bank of Tigerton v. Hackett, 159 Wis. 113, 149 N. W. 703.

488 Evans v. Edmonds, 13 C. B. 786.

489 L. D. Garrett Co. v. Appleton, 101 App. Div. 507, 92 N. Y. Supp. 136; Dickinson v. Chesapeake & O. R. Co., 7 W. Va. 390; Olcott v. Bolton, 50 Neb. 779, 70 N. W. 366; Annis v. Ferguson, 27 Ky. Law Rep. 56, 84 S. W. 553.

490 New v. Jackson, 50 Ind. App. 120, 95 N. E. 328.

person may be guilty of fraud by stating that he knows a thing to be so, when he only believes it to be so. A representation of a fact, as of the party's own knowledge, and which proves false, is, unless explained, inferred to be willfully false and made with an intent to deceive at least in respect to the knowledge professed.481 This rule has been stated with careful precision by the Supreme Court of Wisconsin as follows: If one in negotiating with another in contractual matters makes a misrepresentation

Kock, 159 Iowa, 343, 140 N. W. 220; Farnsworth v. Muscatine Produce & Pure Ice Co., 161 Iowa, 170, 141 N. W. 940; Driver v. Hunt, 2 Ky. Law Rep. 435; Shackelford v. Hendley, 1 A. K. Marsh. (Ky.) 496, 10 Am. Dec. 753; Taymon v. Mitchell, 1 Md. Ch. 496; Ginn v. Almy, 212 Mass. 486, 99 N. E. 276; Fisher v. Mellen, 103 Mass. 503; Converse v. Blumrich, 14 Mich. 109, 90 Am. Dec. 230; Hubbard v. Oliver, 173 Mich. 337, 139 N. W. 77; Steinbach v. Hill, 25 Mich. 78; Jones v. Wing, Har. (Mich.) 301; Brooks v. Hamilton, 15 Minn. 26 (Gil. 10); Freeman v. F. P. Harbaugh Co., 114 Minn. 283, 130 N. W. 1110; Yeater v. Hines, 24 Mo. App. 619; Florida v. Morrison, 44 Mo. App. 529; Milan Bank v. Richmond, 235 Mo. 532, 139 S. W. 352; Peters v. Lohman, 171 Mo. App. 465, 156 S. W. 783; Field v. Morse, 54 Neb. 789, 75 N. W. 58; Faulkner v. Wassmer, 77 N. J. Eq. 537, 77 Atl. 341, 30 L. R. A. (N. S.) 872; Hammond v. Pennock, 61 N. Y. 145; Carr v. National Bank & Loan Co., 167 N. Y. 379, 60 N. E. 649, 82 Am. St. Rep. 725; Alker v. Alker (Sup.) 12 N. Y. Supp. 676; Farjeon v. Indian Territory Illuminating Oil Co. (Sup.) 120 N. Y. Supp. 298; Hunt v. Moore, 2 Pa. 105; Lewis v. McLemore, 10 Yerg. (Tenn.) 206; Beatty v. Bulger, 28 Tex. Civ. App. 117, 66 S. W. 893; McCord-Collins Commerce Co. v. Levi, 21 Tex. Civ.` App. 109, 50 S. W. 606; Cabaness v. Holland, 19 Tex. Civ. App. 383, 47 S. W. 379; Jesse French Piano & Organ Co. v. Nolan, 38 Tex. Civ. App. 395, 85 S. W. 821; Harris v. Shear (Tex. Civ. App.) 177 S. W. 136; Ross-Armstrong Co. v. Shaw (Tex. Civ. App.) 113 S. W. 558; Haldeman v. Chambers, 19 Tex. 1; Ogden Valley Trout & Resort Co. v. Lewis, 41 Utah, 183, 125 Pac. 687; Smith v. Columbus Buggy Co., 40 Utah, 580, 123 Pac. 580; Grim v. Byrd, 32 Grat. (Va.) 293; Wren v. Moncure, 95 Va. 369, 28 S. E. 588; Linhart v. Foreman, 77 Va. 540; McMullin v. Sanders, 79 Va. 356; Taylor v. Ashton, 11 Mees. & W. 415. Some scattering expressions of opinion contrary to the rule stated in the text may be found in the reports. See, for instance, Walker v. Hough, 59 Ill. 375; Faver v. Bowers (Tex. Civ. App.) 33 S. W. 131; Jasper v. Hamilton, 3 Dana (Ky.) 280; Proctor v. Spratley, 78 Va. 254; Becker v. Colonial Life Ins. Co., 153 App. Div. 382, 138 N. Y. Supp. 491; Dumas v. Ware, 143 Ga. 212, 84 S. E. 538; Krankowski v. Knapp, 268 Ill. 183, 108 N. E. 1006.

481 Cabot v. Christie, 42 Vt. 121, 1 Am. Rep. 313; Darling v. Stuart, 63 Vt. 570, 22 Atl. 634.

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