Braley v. Powers

• Decision Date: 01 December 1898
• Citation: 92 Me. 203,42 A. 362
• Parties: BRALEY v. POWERS.
• Court: Maine Supreme Court

42 A. 362

92 Me. 203

BRALEY

v. POWERS.

Supreme Judicial Court of Maine.

Dec. 1, 1898.

(Official.)

Exceptions from supreme judicial court Androscoggin county.

Action by William A. Braley against Robert E. Powers for deceit in the sale of an interest in a patent right. Verdict for plaintiff for $500, and defendant excepts and moves for a new trial. Motion and exceptions overruled.

Argued before PETERS, C. J., and EMERY, HASKELL, WHITEHOUSE, STROUT, and SAVAGE, JJ.

W. H. Newell and W. B. Skelton, for plaintiff.

J. P. Swasey and E. M. Briggs, for defendant.

WHITEHOUSE, J. This was an action to recover damages for fraudulent representations in the sale of an interest in letters patent for the manufacture of harness buckles. The false representation set out in the plaintiff's writ, and relied upon at the trial, was that the defendant "had a quantity of said buckles on hand, consisting of two sizes, which cost him thirty and thirty-five cents per dozen, respectively, samples of which said buckles he then and there exhibited to the plaintiff, and then and there affirmed that be could get all the buckles which they desired to sell at said prices, respectively, and then and there affirmed that said buckles could then and there be sold at sixty-five and seventy-five cents per dozen, respectively, and then and there double the cost."

The plaintiff paid the defendant $800 for one-third interest in the patent, and recovered a verdict for $500. The case comes to this court on exceptions to the rulings of the presiding justice, and also on a motion to set aside the verdict as against evidence.

1. Evidence was admitted under objection, to prove the allegation above set forth; but the court was requested to instruct the jury that this representation by the defendant concerning the cost of the buckles was not a statement of a material fact, and, if false, was not actionable. The defendant excepted to the refusal of the presiding judge to give this instruction.

It is undoubtedly a reasonable rule of the common law, uniformly recognized in this state, that representations of the value of real or personal property which is itself the subject-matter of bargain and sale, or of the price paid or offered for it in a particular instance, are so manifestly statements of opinion on the part of the seller, or mere evidence of the opinion of others respecting its value, that they cannot be deemed statements of material facts which will lay the foundation of an action for deceit, even if the statements are false and intended to deceive. Bishop v. Small, 63 Me. 12; Khoda v. Aunis, 75 Me. 17; Bourn v. Davis, 76 Me. 223; Palmer v. Bell, 85 Me. 352, 27 Atl. 250.

But even in this class of cases, when the statements relate directly to the subject-matter of the sale, it was held in Manning v. Albee, 11 Allen, 520, that false representations that certain railroad bonds were selling in the market at a given price entitled the plaintiff to maintain an action; there being no evidence that the plaintiff had equal means of knowing the truth or untruth of the statements, or that he might not rely upon them without the imputation of negligence. See, also, Com. v. Wood, 142 Mass. 460.

In Coolidge v. Goddard, 77 Me. 578, 1 Atl. 831, it was held that a false representation by the defendant, in effecting the sale of shares in an electric light company, that he and all other stockholders had paid to the company the par value of the stock, constituted a legal fraud, as it affected directly the value of the stock.

In Hoxie v. Small, 86 Me. 23, 29 Atl. 920, the seller of shares in a contract for the purchase of real estate made false representations in regard to the amount paid for them to the owner of the land; and the court held them actionable, saying: "They affected directly the value of the interest which the defendant was selling. The defendant was not selling tangible property. He was selling a fractional interest in a contract And the value of that contract depended largely, if not wholly, upon the amount of payments that had been made upon it."

So in the principal case the defendant was not selling "tangible property," but an interest in a patent right for the manufacture of buckles. The value of the invention obviously depended upon the margin of profit between the cost of manufacturing the buckles and their selling price. Statements in regard to their cost were therefore material, as directly affecting the value of the right to manufacture them. The representations immediately following, that he could furnish all the buckles they wanted at the price named by him, at the cost of those exhibited, and that they could be sold so as to double the cost, were not in themselves statements of existent facts, but were mere predictions and expressions of opinion. They served, however, to give significance and force to his positive statement of the cost of those exhibited. Considered in connection with these accompanying expressions of opinion, the representation that the buckles shown to the plaintiff were manufactured for 30 and 35 cents per dozen, respectively, were well calculated to convey to the mind of the plaintiff the idea that those buckles were manufactured at that cost under ordinary conditions, and not under exceptionally favorable circumstances.

The defendant also excepted to the refusal of the presiding justice to give the jury the following instruction, viz.: "If a party is imposed upon by the fraud of another, when the former had full means of detecting the fraud and ascertaining the truth of the matter, and neglected to inform himself of it when he might easily have done so, the law will not interfere to give relief."

With the exception of the last clause, the language of this request was taken from the opinion in Pratt v. Philbrook, 33 Me. 23. It was there employed by the court in giving reasons for sustaining a demurrer to the declaration, in which it appeared that the written contract with respect to which the false representations were made was readily accessible to the plaintiffs before the trade was completed, and one of the transactions involved was ratified by them after full knowledge of the facts. The language was appropriate for that purpose, but, as an instruction to the jury, it would fail to explain with sufficient fullness and clearness the duty that might rest upon the plaintiffs to exercise reasonable and ordinary care, diligence, and prudence to ascertain the truth or untruth of the defendant's representations. But a careful examination of the evidence in the principal case leads to the conclusion that the jury would not have been authorized to find that the plaintiff had equal...