Hadcock v. Osmer

• Decision Date: 05 October 1897
• Citation: 153 N.Y. 604,47 N.E. 923
• Parties: HADCOCK v. OSMER.
• Court: New York Court of Appeals Court of Appeals

153 N.Y. 604

47 N.E. 923

HADCOCK

v.OSMER.

Court of Appeals of New York.

Oct. 5, 1897.

Appeal from supreme court, appellate division, Fourth department.

Action by Charles E. Hadcock, as executor, against Luman Osmer, for deceit. From a judgment of the appellate division (38 N. Y. Supp. 618) affirming a judgment entered on a verdict for plaintiff, defendant appeals. Affirmed.

Watson M. Rogers, for appellant.

Henry Purcell, for respondent.

VANN, J.

Prior to the 15th of September, 1888, Deloss Brown, as principal, and Joseph Brown, as surety, were indebted to the defendant on a past-due note for over $300, and payment thereof had repeatedly been demanded. After trying in vain to borrow money to pay the note, Deloss told the defendant that he did not know where they could get it, and asked if he must have it. The defendant said ‘yes,’ and, upon being further asked by Deloss where the money could be had, recommended him to call on one Benjamin Hadcock. He did so, and was told by Benjamin that he could not lend the money, but that his brother, Emmanuel, who was stopping with him, could let him have it. Deloss reported to the defendant that he thought he could get the money of ‘the Hadcocks,’ and that they would let him have it ‘some time in October.’ When the time came around, the Messrs. Brown started to see if they could get the money of Emmanuel Hadcock, but first went to the defendant, and asked him to go along. He said that he could not, when Deloss declared there was no use of their going alone, and thereupon the defendant wrote and delivered to the Browns a paper, of which the following is a copy: ‘Mr. Hadcock: The Browns are good for what money you let them have. [Signed] L. Osmer.’ The Hadcocks did not know the Browns, but, as they knew the defendant, on the strength of this paper Emmanuel Hadcock lent them $400, taking their note therefore, and on the same day they used the most of the money to pay their debt to the defendant. Both of the Browns were insolvent at this time, and, while the defendant may have believed they were good, he did not know whether they were good or not, and did not try to find out. Upon the trial of this action, which was brought to recover damages for false representations by means of said paper, there was but slight dispute as to the representations, their falsity, or the injury resulting therefrom; but the defendant insisted that, as he did not know that his representations were false, there could be no recovery against him. Through his counsel, he asked the trial court to charge the jury ‘that there can be no recovery in an action of deceit unless it appears that the defendant made the representations knowing them to be false, with intent to deceive, and that the plaintiff suffered damages in consequence thereof.’ The court refused to so charge, except with the modification: ‘That, if he made the statement that they were good as a fact, not as an opinion, without knowing whether it was true or not, then it was false in the sense that he made a statement of fact as though he knew it to be true, which he did not know to be true. That, together with what I have already said in my charge in regard to it, will enable the jury to understand what I mean.’ Exception was taken to the refusal to charge as requested and to the charge as made. In the body of the charge, the court, after instructing the jury as to the difference between the assertion of a fact and the expression of an opinion, told them, in substance, that if the defendant made the representation, either knowing it to be untrue, or, without knowing whether it was untrue or not, stating it as an existingfact, intending that it should be taken and acted upon as such, they might infer an intent to defraud; ‘because,’ as the court continued, ‘a man has no right to state a thing as a fact, which misleads the other party to his damage, unless he knows whether it is true or untrue; and if he states it, knowing and understanding that he does not know whether it is true or not, he just as much misleads the other man as though he stated it with the knowledge that it was untrue.’

An action to recover damages for deceit cannot be maintained without proof of fraud as well as injury. Actionable deceit cannot be practiced without an actual intention to deceive, resulting in actual deception, and consequent loss. But, while there must be a furtive intent, it may exist when one asserts a thing to be true which he does not know to be true, as it is a fraud to affirm positive knowledge of that which one does not positively know. Where a party represents a material fact to be true to his personal knowledge, as distinguished from belief or opinion, when he does not know whether it is true or not, and it is actually untrue, he is guilty of falsehood, even if he believes it to be true; and if the statement is thus made with the intention that it shall be acted upon by another, who does so act upon it, to his injury, the result is actionable fraud. Kountze v. Kennedy, 147 N. Y. 124, 130,41 N. E. 414;Rothschild v. Mack, 115 N. Y. 1, 7,21 N. E. 726;Marsh v. Falker, 40 N. Y. 562, 573;Bennett v. Judson, 21 N. Y. 238; Add. Torts, 1007; 1 Bigelow, Fraud, 514. Such seems to be the case now before us, as the facts are presumed to have been found by the jury. The plaintiff's testator did not ask for information in regard to the solvency of those who wished to borrow money of him, but the defendant volunteered to give it. He was interested in the result of the loan, for the bulk of the proceeds was for his benefit. On being told that the loan would not be made without his presence, he armed the proposed borrowers with a written statement over his own signature, containing a positive assertion of a material fact, with the intention that it should be acted upon, and should induce the loan of the money. Yet he did not know the assertion thus...