Deshatreaux v. Batson

• Decision Date: 15 December 1930
• Docket Number: 29016
• Citation: 131 So. 346,159 Miss. 236
• Court: Mississippi Supreme Court
• Parties: DESHATREAUX v. BATSON et ux

131 So. 346

159 Miss. 236

DESHATREAUX v. BATSON et ux

No. 29016

Supreme Court of Mississippi

December 15, 1930

Division B

1. FRAUD. Generally, purchaser of property has no right to rely on

representations as to value.

Such statements are generally mere expressions of opinion or judgment which will not excuse other party's failure to make examination for himself for purpose of ascertaining real facts.

2 FRAUD.

General rule that person has no right to rely on representations of value is especially applicable where relationship of parties is antagonistic.

3 FRAUD.

Mere expressions of opinion, however positive, will not support charge of fraud, where means of information are equally accessible.

4 FRAUD.

Where no confidential relationship existed, and representations of value did not preclude investigation, case was not within exceptions to general rule that representations of value could not constitute fraud.

5. FRAUD. Representations by party to exchange agreement concerning value of grocery stock and fixtures and amount of paving assessment and taxes held mere expressions of opinion. Owner of grocery business and lot on which store was situated entered into contract for exchange of property with owner of other realty. Owner of store through his agent made representations concerning value of grocery stock in store, fixtures therein, and probable amount of paving charges and taxes against property. Parties were dealing at arm's length, and no relation of trust or confidence existed between them, nor did owner of grocery business or his agent do anything to prevent other parties from investigating and determining for themselves value of grocery stock and fixtures and amount of taxes and paving charges against property.

HON. T. P. DALE, Chancellor.

APPEAL from chancery court of Forrest county, HON. T. P. DALE, Chancellor.

Suit by N. Batson and wife against Daniel M. Deshatreaux. Decree for complainants, and defendant appeals. Reversed, and bill dismissed.

Reversed and dismissed.

Morris & Wingo, of Hattiesburg, for appellant.

It is the general rule of law that a misrepresentation of value cannot constitute the basis of an action of fraud or deceit.

Corpus Juris, page 1215, par. 110.

As a general rule one has no right to rely upon representations as to value or cost, but is rather required to exercise his own judgment in the matter. It is deemed an act of folly on his part to credit the other party's assertion. Such statements are usually more or less assimilated to mere expressions of judgment which will not excuse the other party's failure to make an examination for himself for the purpose of ascertaining what the facts really are, especially where the relation of the parties is antagonistic such as buyer and seller.

12 R. C. L., page 381, par. 132; Anderson v. Burnett, 5 Howard, 165; Bell v. Henderson, 6 Howard, 311; Anderson v. Hill, 12 S. & M. 697; Walker v. Mobile & Ohio Railroad Co., 34 Miss. 245; Lake v. Security Loan Ass'n, 72 Ala. 207; Moore v. Carrick, 26 Colo.App. 97, 140 P. 485; Gustafson v. Rustmeyer, 70 Conn. 125, 39 L. R. A. 644; Williams v. McFadden, 23 Fla. 143, 1 So. 618; Standish v. Nicholls, 162 Ill.App. 131; Boltz v. O'Conner, 45 Ind.App. 178, 90 N.E. 496; Hoffman v. Wilheim, 68 Iowa 510, 27 N.W. 483.

Under the general rule fraud cannot be predicated upon representations concerning the value of chattels such as stock of goods.

26 C. J., page 1221, par. 110; Patterson v. Barrie, 30 App. D. C. 531; Giles Co. v. Recomier Co., 12 N.Y. State, 169; Standish v. Nichols, 162 Ill.App. 131; Boston Consolidated Gas Co. v. Fullsom, 130 N.E. 197; Johnson v. Seymore, 79 Mich. 156, 44 N.W. 344; Cohn v. Broadhead, 51 Nebr., 834, 71 N.W. 747; Eagle Drug Co. v. White (Texas Civ. App.), 182 S.W. 373.

If a person knew that statements were false or could have ascertained that they were from the ordinary means of information at his command he was not justified in relying thereon.

Pilot Life Insurance Co. v. Wade, 153 Miss. 874, 121 So. 845; Watson v. Austin, 63 Miss. 469; Childs v. Hall, 128 Miss. 111, 90 So. 626.

Currie, Stevens & Currie, of Hattiesburg, for appellees.

Even the expression of an opinion is held to be actionable, if shown to be knowingly false, made with the intention to deceive, and having been accepted and relied upon.

Wall v. Graham, 68 So. 298.

Misrepresentations of value may under certain circumstances be treated as actionable misrepresentations of fact, as where such misrepresentations are coupled with concealment of material facts or with artifice or misrepresentation used to prevent the hearer from learning the truth; where they are expressed and understood as statements of fact, especially if the speaker professes personal knowledge that his statements are correct, as where he warrants the truth of the statements made; or where the speaker obviously knows or intends that the hearer will rely upon his representations of value, because the hearer has expressly told him so, as where the truth of the speaker's statement was made a controlling element of the transaction, or because confidential relation obtain, and a false representation of value may be actionable as a misrepresentation of the speaker's opinion. If the parties deal upon unequal terms the rule that misrepresentations of value are nonactionable expressions of opinion does not apply and under such circumstances they will constitute remediable fraud, as where the facts are peculiarly within the knowledge of the speaker and difficult for the hearer to ascertain.

26 C. J., pages 1217, 1218, 1219, 1220 and 1221; 12 R. C. L., page 381, par. 132.

Since the gross valuation of the stock of goods, computed according to certain private price marks, depended upon quantity and price, a misrepresentation as to such gross valuation is not an expression of opinion, but an actionable misrepresentation of fact.

Elerick v. Reed, 54 Kans. 579, 38 P. 814; Knopfler v. Flinn, 135 Minn. 333, 160 N.W. 860, Ann. Cas. 1918C, 538.

It is generally held that fraud may be predicated of false representations or concealment, although the truth could have been ascertained by an examination of public records.

12 R. C. L. 377; Parham v. Randolph, 4 How. (Miss.), 435, 35 Am. Dec. 403.

It is declared that as between the original parties, one who has intentionally deceived the other to his prejudice is not to be heard to say, in defense of the charge of fraud, that the innocent party ought not to have trusted him, or was guilty of negligence in so doing.

12 R. C. L., pages 378-379, sec. 130.

Any intentional misrepresentation or concealment in relation to land, either as to quality or title, by which the purchaser is imposed on, is fraudulent; and it is immaterial whether the false representations are intentional or not. If the vendor undertake to make statements, he is responsible for them.

Parham v. Randolph, 4 How. 435.

A purchaser has a right to rely upon the representations of a seller as to facts within the latter's knowledge, and the seller cannot escape responsibility by showing that the purchaser upon inquiry, might have ascertained that such representations were not true. Contributory negligence is not a defense to an action based on fraud. If a false statement is made by one who may be fairly assumed to know what he is talking about, it may be accepted as true, without question and without inquiry, although the means of correct information are in reach.

Nash Mississippi Valley Motor Co. v. Childress, 125 So. 708; King v. Livingston Mfg. Co. (Ala.), 60 So. 145.

Where a vendor makes a false representation to his vendee as to the amount of taxes due on the premises, he is liable, though the vendee could have ascertained its falsity by inquiry.

Wright v. United States Mortgage Co. of Scotland, Limited et al., 42 S.W. 789; Woteshek v. Neumann, 138 N.W. 1000.

OPINION

Anderson, J.

Appellees filed their bill against appellant in the chancery court of Forrest county, to recover damages claimed to have been suffered by them on account of deceit and fraud practiced upon them by appellant in the exchange between the parties of certain lands. Appellant being a non-resident, and owning land in Forrest county in this state, the action was begun by a foreign attachment in chancery. The cause was heard on original bill, answer, and documentary and oral proofs. A final decree was rendered in the cause, granting appellees the relief prayed for in their bill. From that decree appellant prosecutes this appeal.

Appellant owned a lot in the city of New Orleans, on which was a storehouse in which he conducted a grocery business. The lot on which the store is situated is triangular in form, bounded by South Robertson, Felicity, and Terpsichore streets.

Appellees owned land in Forrest county in this state. As the result of negotiations previously had between the parties on the 16th of October, 1929, they exchanged property, appellant conveying to appellees his storehouse and lot and stock of groceries and fixtures in the storehouse, in the city of New Orleans, and appellees conveying to appellant their lands in Forrest county. These conveyances were carried into effect, and consummated by two written contracts entered into between the parties on September 20, 1929, providing for such conveyances.

The two written contracts referred to were, in effect, only one contract; for the obligations undertaken in each were the consideration for the obligations undertaken in the other. In these preliminary contracts appellant's property in New Orleans, and appellees' property in Forrest county in this state, were each valued at eight thousand dollars. Appellant's property, without incumbrances, was valued at $...