H. D. Sojourner & Co. v. Joseph

• Decision Date: 16 October 1939
• Docket Number: 33828
• Parties: H. D. SOJOURNER & CO. v. JOSEPH et al
• Court: Mississippi Supreme Court

191 So. 418

186 Miss. 755

H. D. SOJOURNER & CO. v. JOSEPH et al

No. 33828

Supreme Court of Mississippi, Division B

October 16, 1939

APPEAL from the circuit court of Copiah county HON. R. E. BENNETT Judge.

Action by H. D. Sojourner & Company against A. Joseph and another for alleged fraud and deceit in representations made by the named defendant as to the financial ability of the unnamed defendant and a third party. Judgment for the named defendant, and plaintiff appeals. Reversed and remanded.

Reversed and remanded.

M. S McNeil and McNeil & Zama, all of Hazlehurst, for appellant.

In the case of Vincent v. Corbitt, 94 Miss. 46, 21 L.R.A (N.S.) 85, the Supreme Court of Mississippi said:

"While due weight must be given to the necessity for alleging and proving that declarations were made with knowledge of their falsity, regard must also be had for the equal well-settled principle that statements recklessly made and statements made as of knowledge when in fact no such knowledge exists are in law considered as the equivalents of conscious misrepresentations. The doctrine is thus aptly put: In actions of deceit, the charge of fraudulent intent is 'maintained' by proof of a statement made as of the party's own knowledge, which is false, provided the thing stated is not merely a matter of opinion, estimate, or judgment, but is susceptible of actual knowledge; and in such case it is not necessary to make any further proof of an actual intent to deceive. The fraud consists in stating that the party knows the thing to exist when he does not know it to exist; and, if he does not know it to exist, he must ordinarily be deemed to know that he does not." Chatham Furnace Co. v. Moffatt, 147 Mass. 403, 9 Am St. Rep. 727, 18 N.E. 168. It is further said in 14 Am. Eng. Enc. Law, (2 Ed.), p. 99: "To bring a case within the principle above stated, it is not necessary that the party who has made the false statement of fact shall have unqualifiedly declared himself possessed of knowledge, or, in other words, that he shall have asserted in express terms that he knew his statement to be the truth. If a person makes a positive and unqualified false statement of fact which is susceptible of knowledge, an affirmation of knowledge is implied from the positive character of the statement; and, if he has no knowledge, he is guilty of actual fraud."

Henry v. Dennis, 85 Am. St. Rep. 378.

Defendants' instruction No. 2 requiring the jury to find for Joseph unless Sojourner relied solely on Joseph's representations constitutions prejudicial error.

The suit was filed in the court below and tried on the theory that Sojourner relied on the joint representation of Joseph and of Karam, and that they both participated in the fraud perpetrated on Sojourner.

It is not essential to redress that a representation or concealment should have been the sole cause of action, but it is sufficient if it constituted one of several inducements and exerted a material influence. In such a case recovery may be had, although the representation was not the predominating inducement to action or the representee's injury was due partly to his own mistake. Thus, where the representation was material inducement to action, recovery may be had, although the injured party was influenced to some extent by the statements of their persons or by information gained through independent investigation, or relied in part upon other representations of the speakers which were not actionable in themselves, because true, of a promissory nature, or within the statute of frauds, or where the hearer relied partly upon representations and partly upon a guaranty. The foregoing rule with its accompanying qualifications has been applied to representations concerning financial standing.

26 C. J. 1165; and authorities cited therein.

Where a false statement is relied upon and is a material inducement, it is immaterial that other causes contributed to influence the conduct of the injured party.

Yates v. Jones Nat. Bank, 74 Nebr. 734, 748, 105 N.W. 287; Allen v. Pendarvis, 60 Okla. 216, 217, 159 P. 1117; Safford v. Grout, 120 Mass. 20.

A representation contributing "in any degree" to induce the party to act is sufficient.

Baker v. Matthew, 115 N.W. 15; Kirkendall v. Hartsock, 58 Mo.App. 234; Evans v. MacMicking, 2 Alt. L. 5; 12 R. C. L. 112; Dunbar v. Preston (Pa.), 132 A. 707; Durham v. Wichita Mills (Tex.), 202 S.W. 138; Old Colony Ins. Co. v. Molglein, 205 N.W. 885; Allen v. Pendarvis (Okla.), 159 P. 1117; Hart-Parr Co. v. Krigam, 212 S.W. 835.

Counsels for the defendants were not content with the very emphatic instruction quoted above, but even though this suit was expressly brought upon a joint cause of action, the defendants requested and obtained the following instruction: "The court instructs the jury for the defendant, Albert Joseph, that if you believe from the evidence in this case that Albert Karam represented himself to the plaintiff as being a representative of the Karam Produce Company and that he and the Karam Produce Company were able, to pay for any tomatoes that he may buy and that on this the plaintiffs sold to him tomatoes, then you cannot find a verdict against the defendant, Albert Joseph."

This instruction in reality amounts to a peremptory instruction because both Sojourner and Karam testified that Karam did make the representations recited in the instruction, and the instruction in effect tells the jury that if Joseph misrepresented Karma's integrity and financial condition and business, and Karm likewise made the same misrepresentations that Karam's misrepresentations would relieve Joseph.

Joint liability for fraud is up held in the same manner as joint liability of other tortfeasors.

12 R. C. L. 400; James v. Crosthwait, 97 Ga. 673, 36 L.R.A. 631; Linhart v. Foreman, 77 Va. 540; Rorer Iron Company v. Trout, 83 Va. 379, 5 Am. St. Rep. 285, (292); Stackpole v. Hancock (Fla.), 45 L.R.A. 814, (821); Cabot v. Christie, 42 Vt. 121, 1 Am. Rep. 313, (316); Buchanan v. Burnett, 132 Am. St. Rep. 900, (902), 102 Tex. 492; Hindman v. First National Bank of Louisville (C. C. A.), 112 F. 931, 57 L.R.A. 108; Salter v. Aviation Salvage Company, 91 So. 340.

Defendant's Instruction No. 3 to the effect that if Sojourner relied on Karam's statement he could not recover is erroneous.

Defendant's Instruction No. 5 requiring the plaintiff, Sojourner, to make independent investigation and not permitting reliance on representations made is erroneous.

85 A. S. R. 380; Nash Mississippi Valley Motor Company v. Childress, 156 Miss. 157, 125 So. 708; Gannon v. Hausaman, 42 Okla. 41, 52 L.R.A. (N.S.) 519; King v. Livingston Mfg. Co., 60 So. 143; Smith v. Werkheiser (Mich.), 15 L.R.A. (N.S.) 1092; Lahay v. City National Bank (Colo.), 22 Am. St. Rep. 408.

Defendant's Instruction No. 1 is on the weight of the evidence.

Howie, Howie & McGowan and Hamilton & Todd, all of Jackson, and Hunter Garth, of Hazlehurst, for appellee.

Before proceeding to a discussion of the point in order, as raised in appellant's assignment of errors, we wish to discuss briefly to the court "the legal principles involved, " as is contended by the appellant governing this case. So far as the Mississippi law is concerned he bases his right for a recovery upon the case of Vincent v. Corbett, 94 Miss. 46, 47 So. 641. A careful examination of this case does not make an easy case for this appellant. A careful reading of this case along with the cases quoted therein and other cases on the subject, by analysis, indicate to us the following:

1. An admission or proof positive of making the statements at most, make only a prima facie case for the suing plaintiff.

2. Scienter cannot be dispensed with.

In the case of Lundy v. Haslitt, 147 Miss. 808, 112 So. 591, the court held that "a vendor's false representation as to the amount of acreage is actionable though made in good faith." It was his own land concerning which the representations were made. A person should not be permitted to make representations about his own property and plead innocence in the courts.

Alexander v. Meeks, 132 Miss. 298, 96 So. 101; Oldham v. Memphis Stone & Gravel Co., 145 Miss. 851, 111 So. 357; Hinds v. Lockhart (Miss.), 105 So. 449; McNeer v. Norfleet, 113 Miss. 611, 74 So. 577, Ann. Cas. 1918D, 436; Estell v. Myers, 54 Miss. 174; Sims v. Eiland, 57 Miss. 83.

It is highly significant that of all the Mississippi cases we can find on this subject practically all of them deal with representations claimed to have been innocently made by the defendants in reference to certain lands or property belonging to the said defendants.

It is, we repeat, most significant that of all the cases we have quoted above, which are most of the cases we find in the Digest on the said subject, only the case of Sims v. Eiland represents a case where the subject matter is not land or property belonging to the defendant. It is to be presumed, of course, that as a matter of fact a person is supposed to know his own property. The defendants in the case of Vincent v. Corbitt, above, could not be heard to say they did not know their own land.

The case of Sims v. Eiland, above, is the only case that we can find where the facts anything like conform or make up a set of circumstances comparable with those involved in the case at bar. In that case the plaintiff was put to the burden of proving that the letter was written with an actual knowledge of the falsity of the recommendations made therein, and this rule of law, as we insist, has not been changed in Mississippi today.

It is elemental that instructions must follow the evidence of the case.

Burnley v. Mullins, 86 Miss. 441, 38 So. 635; Am. Central Ins Co. v. Antram, 88 Miss. 518, 41 So. 257; Mobile J. &...