Jones v. National Building Association

• Decision Date: 03 May 1880
• Citation: 94 Pa. 215
• Parties: Jones <I>versus</I> The National Building Association.
• Court: Pennsylvania Supreme Court

94 Pa. 215

Jones versus The National Building Association.

Supreme Court of Pennsylvania.

March 31, 1880.

May 3, 1880.

March 31st 1880.

Before SHARSWOOD, C. J., MERCUR, GORDON, PAXSON, TRUNKEY and STERRETT, JJ. GREEN, J., absent

Error to the Court of Common Pleas of Lackawanna county: Of January Term 1880, No. 235.

Lemuel Amerman, for plaintiffs in error.—The contract of Jones to become surety cannot be separated from that by which it was induced, viz.: the promise to release him upon James furnishing other security. The association must adopt the whole contract, including the statement and representations which induced it: Hunt v. Moore, 2 Barr 105; Mundorff v. Wickersham, 13 P. F. Smith 87; Keough v. Leslie, 11 Norris 424. She cannot have the advantage of the security desired and retain the price of it, viz.: the security of Jones: Mundorff v. Wickersham, supra, and cases there cited.

A man cannot take any benefit under a false and fraudulent representation made by his agent, although he may have been no party to the representations, and may not have distinctly authorized them. No matter how innocent he may be, he cannot reap the fruits of his agent's fraud: Hern v. Nichols, 1 Salk. 288; Musser v. Hyde, 2 W. & S. 314; Bennett v. Judson, 21 N. Y. 238; Elwell v. Chamberlain, 31 Id. 611; Southern Express Co. v. Palmer, 48 Ga. 85.

Though the plaintiff below is a company or corporation, she is as much bound by the false and fraudulent representations of her agent as an individual: Angell & Ames on Corporations 249; Custer v. Titusville Gas Co., 13 P. F. Smith 381. Even though Jones, the surety, were a member of the association, he must be discharged. The rule that a company cannot retain any benefit which it may have obtained through the false and fraudulent representations of its agents, applies to the case of a member of the company who was induced by such representations to enter into a contract with the company: Western Bank of Scotland v. Addie, L. R., 1 S. C. Ap. Cas. 163; 1 Am. Law Review (N. S. No. 3) 181; Oakes v. Turquand, L. R., 2 H. L. 325.

No counsel nor paper-book, contra.

Mr. Justice PAXSON delivered the opinion of the court May 3d 1880.

The learned referee found as matter of fact that at the time the note in controversy was executed, J. M. C. Ranck, the secretary of the building association, represented to David T. Jones, the surety in said note, that he would only be security on the loan for about three months, or until Mr. James, the principal, could get an insurance policy on his house and deposit it with the association; that about ten weeks after, Mr. James procured a policy of insurance on his house, and deposited it with the association; and that soon after, Mr. Jones...