Crockett v. Burleson
| Citation | 54 S.E. 341,60 W.Va. 252 |
| Parties | CROCKETT v. BURLESON. |
| Decision Date | 12 June 1906 |
| Court | Supreme Court of West Virginia |
Submitted February 20, 1906.
Syllabus by the Court.
An action on the case for damages in the nature of a writ of deceit lies at law against a person for making false and fraudulent representations as to a material matter, whereby another is induced to enter into a contract, and by so doing sustains damages.
Where a party has been induced to enter into a contract, by such false and fraudulent representations made by the other party thereto as would entitle the former to a rescission of the contract, he may, upon discovery of the fraud, affirm the contract and bring his action at law for any damages sustained by the deceit.
If a vendor, by fraud practiced on his vendee, has sold what he at the same time warranted, a case of simultaneous contract and tort, the vendee may have his remedy either upon the practiced deceit or upon the warranty, as he chooses.
If one partner, having charge of the business and books of the firm by making material, false, and fraudulent representations, to the effect that certain items of charge against others constituted debts owing to the firm, when, in fact, some of said items had been collected by him, and others were false charges, induced the other partner to enter into a contract finally settling and dissolving the partnership, whereby the latter took over for value as his individual property all of said items of charge, the latter may, upon discovery of the fraud, without rescinding the contract, sue the former at law for any damages occasioned by the deceit.
Error to Circuit Court, Mercer County.
Action by W. S. Crockett against T. H. Burleson. Judgment for defendant, and plaintiff brings error. Reversed and remanded.
Crockett & Crockett and Harold A. Ritz, for plaintiff in error.
John R Dillard, for defendant in error.
W. S Crockett complains of a judgment of the circuit court of Mercer county, dismissing an action at law originally instituted by him against T. H. Burleson before a justice and tried in said circuit court upon appeal. The plaintiff Crockett, claims that he and the defendant, Burleson, were partners in the livery business in the city of Bluefield; that the defendant was the active member of the firm, and conducted its business and kept its books; that on the 16th day of January, 1904, a contract was entered into between them finally settling and dissolving the partnership, whereby the plaintiff took over for value as his individual property certain items of charge against others as debts owing to the firm; that previous to the making of the contract the books were turned over to plaintiff; that he made therefrom a list of said charges apparently owing to the firm; that the list was then turned over to defendant for correction; that after he corrected the list he returned it to plaintiff, and represented to him that it was correct; that plaintiff believed such representations and was induced by them to enter into the contract; that but for such representations he would not have entered into the contract; that it afterwards turned out that some of the charges contained in said list were false charges, and that others had been collected by the defendant at the time such representations were made; and that, after discovering the fraud and without rescinding the contract, the plaintiff instituted this action, claiming $295.95 as damages for the deceit. Plaintiff claims other matters not necessary to be mentioned here. Upon the trial in the circuit court the plaintiff offered evidence tending to prove the essential elements of his claim above stated; but upon objection and motion the court excluded the plaintiff's evidence, directed a verdict for defendant, and entered the judgment of dismissal.
The single question presented here is, Can this action at law for the alleged deceit be maintained by the plaintiff against the defendant, his former partner? An action on the case for deceit is of ancient origin. In the case of Pasley v. Freeman, decided by the Court of King's Bench in 1789, 12 Eng Rul. Cas. 235, it was held that "a false affirmation made by the defendant, with intent to defraud the plaintiff, whereby the plaintiff receives damage, is the ground of an action upon the case in the nature of deceit." In 1 Bigelow on Frauds, 466, the author, referring to this case, says: "This has been the law in actions for damages for a hundred years." An action on the case for damages in the nature of a writ of deceit lies at law against a person for making false and fraudulent representations as to a material matter, whereby another is induced to enter into a contract and by so doing sustains damage. Kerr on Fraud, 53, 324; Pasley v. Freeman, supra. Where a party has been induced to enter into a contract by such false and fraudulent representations of the other party thereto as would entitle the former to a rescission of the contract, he may, upon the discovery of the fraud, affirm the contract and bring his action at law for damages for the deceit. 8 Am. & Eng. Enc. Pl. & Pr. 884, 885; Clark on Cont. § 168; Cooley on Torts, 589; Lowe v. Trundle, 78 Va. 65. An action at law for deceit, between proper parties and upon a proper state of facts, is fully established by the authorities both in England and America. Schuchardt v. Allens, 1 Wall. (U. S.) 369, 17 L.Ed. 642; Deery v. Peak (H. L. 1889) 12 Eng. Rul. Cas. 250; Clark on Cont. § 168; 8 Am. & Eng. Enc. Pl. & Pr. 884, 885; Bishop on Noncontract Law, § § 313, 343; Mechem on Sales, § 1666; Webb's Pollock on Torts, 348, 353, note; Cooley on Torts, 589; Bank v. Spates, 41 W.Va. 32, 23 S.E. 681, 56 Am. St. Rep. 828; Rice v. White, 4 Leigh, 474.
It is contended that this action for alleged deceit is not cognizable at law, because the partnership relation existed between plaintiff and defendant when the alleged deceit was practiced, and because the alleged deceit related to the state of the indebtedness owing to the firm, and because this action necessarily involves a reopening and resettlement of the partnership accounts and business. A partnership is founded in contract. The contract, from its very nature creates a relation of mutual trust and confidence. Parsons on Part. (4th Ed., 1893) § 191, says: "Whenever there has been any breach of an express stipulation between persons who are partners, an action for damages will be sustained, unless the breach, or the stipulation itself, or both, are such that they involve the whole partnership business and accounts, and the damages can be determined only by first settling those accounts." See, also, Barton's Law Prac. § 69; Story on Part. § 218. In Freeman's note to the case of Course v. Prince, 12 Am. Dec. 650, it is said: ...
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