Howard v. Dun & Bradstreet, Inc.

• Decision Date: 23 September 1975
• Docket Number: No. 1,No. 50894,50894,1
• Court: Georgia Court of Appeals
• Parties: Randy HOWARD v. DUN & BRADSTREET, INC

Page 702

220 S.E.2d 702

136 Ga.App. 221

Randy HOWARD v. DUN & BRADSTREET, INC.

No. 50894.

Court of Appeals of Georgia, Division No. 1.

Sept. 23, 1975.

Rehearing Denied Oct. 21, 1975.

Charles L. Weltner, Atlanta, for appellant.

Hansell, Post, Brandon & Dorsey, Hugh M. Dorsey, Jr., W. Rhett Tanner, Hugh E. Wright, Atlanta, for appellee.

MARSHALL, Judge.

This is an appeal from an order by the Fulton Superior Court granting appellee's (defendant below) motion for summary judgment and entering judgment in favor of Dun & Bradstreet and against Howard.

The record reflects that one Smith, doing business as United Caribbean Air Services, Inc., advertised the sale of a half interest in his business. Appellant Howard taking notice of the ad, contacted Smith. During the initial meeting between Howard and Smith, Smith told Howard that United Caribbean Air Service, Inc., owned one airplane and was negotiating the purchase of a second. Additionally, the business owned a 1/4 interest in a shrimp processing business in Costa Rica and certain other assets there. The two airplanes were to be used to fly fresh shrimp to Birmingham, Alabama, where the shrimp could be sold at a great profit. On the flights to Central and South America, the planes were to be used to transport and sell ladies undergarments to jobbers and wholesalers in the lower Americas. Smith stated he had had other employees and investors but they were not partners who could help manage the business. Smith was interested in a full time partner who could manage the business in Atlanta while he, Smith, was in Central and South America managing the business interests there. Smith also exhibited to Howard at this meeting, what appeared to be a standard Dun & Bradstreet rating of the business. In substance, this rating reflected the net worth of the business as $187,204.00 and the personal net worth of Smith as of March, 1970, at $1,643.620.00.

Based upon the assertions made by Smith and relying on the evaluations of Dun & Bradstreet, Howard agreed to invest $50,000.00 as the purchase price of a one-half interest in the partnership. He gave $5,000.00 to Smith at the first meeting on September 30, 1970. On October 2, 1970, Howard paid an additional $35,000.00 and executed a $9,000.00 promissory note. Sometime after October 2, 1970, Howard also requested an evaluation of the business and Smith by appellee, Dun & Bradstreet. In late November, 1970, an agent of Dun & Bradstreet furnished what appeared to be a standard report to Howard concerning Smith and the business which apparently reflected the same information Howard had seen in Smith's possession on September 30, 1970. It is undisputed that the information furnished by appellee, Dun & Bradstreet, was gratuitous and involved no fee. The service was designed to demonstrate the effectiveness of such service as an incentive to Howard to subscribe as a customer. However, Howard never was, nor did he ever become, a customer entitled to Dun & Bradstreet's services.

Subsequent to appellant's investment of $50,000.00 he was able to determine that Smith was basically insolvent and that the aircraft allegedly owned by the business were nonexistent. The shrimp processing business, while it had existed at a previous time, had burned some years prior to Smith's representations in September, 1970. It also appears that during the past 10 years, Smith had been the subject of at least 15 lawsuits, one of which sounded in fraud. Appellant obtained a judgment against Smith, which he claims is worthless. He then brought this action against Dun & Bradstreet claiming that he would not have invested his money in a worthless business venture were it not for appellee's report of Smith and United Caribbean Air Service, Inc., and the grossly negligent misrepresentations therein published by appellee Dun & Bradstreet.

After examining the evidence presented by both parties, the trial court granted appellee's motion for summary judgment. This appeal followed. Held:

Appellant contends that Dun & Bradstreet, Inc., is a reputable business concern with a generally accepted reputation for excellence of product; that it furnished to Smith and later to Howard a report of Smith's personal net worth as well as the net worth of Smith's business that was factually incorrect and grossly misleading; that a simple check of the plaintiff-defendant index in the courthouse records would have disclosed the unreliability of Smith or any information furnished by Smith to appellee as a predicate for a business evaluation;...