Anderson v. Spriestersbach

• Decision Date: 29 July 1912
• Citation: 69 Wash. 393,125 P. 166
• Parties: ANDERSON v. SPRIESTERSBACH et ux.
• Court: Washington Supreme Court

125 P. 166

69 Wash. 393

ANDERSON v. SPRIESTERSBACH et ux.

Supreme Court of Washington

July 29, 1912

Department 1. Appeal from Superior Court, Snohomish County; W. P. Bell Judge.

Action by Theodore Anderson against Charles P. Spriestersbach and wife. From a judgment for plaintiff, defendants appeal. Reversed and remanded.

Cooley & Horan and R. Mulvihill, for appellants.

Coleman Fogarty & Anderson, of Everett, for respondent.

CHADWICK, J.

This action was brought to recover the sum of $463.50, the price of certain abstracts made by plaintiff for defendants. The defendants answered, setting up a counterclaim for damages. A further statement of the facts is unnecessary at the present time. The legal question to be resolved is whether an abstracter, knowing that the party to whom he delivers an abstract at the instance of the owner, who ordered and paid for it, will rely upon it in making a trade or purchase of the property described therein, is liable in damages for a loss resulting from a material error or omission. The trial judge applied the rule as laid down in 1 Cyc. 215: 'By the weight of authority, an abstracter is liable only to the person ordering and paying for the abstract; and, where this view obtains, the fact that an abstracter has knowledge that his abstract is to be used in a sale or loan to advise a purchaser, or a person about to lend money, does not affect the rule as to his liability.' This rule is sustained by the weight, considered in numbers, of authority; but we are not willing to apply it, unless it is plain that there was no duty on the part of the abstracter to the party injured. In this case the abstracter not only knew the purpose of the abstract, but became the agent of the other party to the transaction, out of which the loss resulted, to deliver it to defendant. He knew that the trade, if made at all, would be made upon the faith of his certificate.

What is called the general rule has not been allowed to stand without strong and persistent challenge. In one of the leading cases Savings Bank v. Ward, 100 U.S. 195, 25 L.Ed. 621 the doctrine was denied by Chief Justice Waite, dissenting with whom Justices Swain and Bradley concurred. He said: 'The circumstances were such as ought to have satisfied him that his certificate was to be used by Chapman in some transaction with another person as evidence of the fact certified to. * * * It seems to me that under these circumstances Ward is liable to the bank for any loss it may sustain by reason of his erroneous certificate.' Like expressions are to be found in many of the cases. In some states the injustice of the rule invoked by plaintiff has been recognized by the Legislature and abrogated by statute. We are not now propared--indeed, it is not necessary--to hold that an abstracter is liable to a third party to whom his customer presents an abstract in the procurement of money or property. The general rule was recognized, if not expressly affirmed, in Bremerton Development Co. v. Title Trust Co., 67 Wash. 268, 121 P. 69, where a recovery was allowed upon our finding of strict privity of contract; but it does not follow that there are no exceptions to the rule. Indeed, they have been recognized, and, in our judgment, are as securely established as the rule itself. So where, as in this case, the facts warrant us in saying that there was a republication of the abstract to the defendant, or that it was made in his behalf, we have no hesitation in asserting that the abstracter is responsible under his certificate for the loss sustained.

'It is very well known that the owner of real estate seldom incurs the expense of procuring an abstract of the title from an abstracter, except for the purpose of thereby furnishing information to some third person or persons, who are to be influenced by the information thus provided. If the abstracter in all cases be...