Pendergast v. Reed

• Decision Date: 21 October 1868
• Parties: JAMES F. PENDERGAST v. EDWARD C. REED.
• Court: Maryland Court of Appeals

29 Md. 398

JAMES F. PENDERGAST v. EDWARD C. REED.

Court of Appeals of Maryland

Oct. 21, 1868

APPEAL from the Superior Court of Baltimore City.

This was an action brought by the appellee against the appellant to recover a sum of money, obtained from the former by the latter, in the sale of a vessel by fraudulent and deceitful representations. Two exceptions were taken by the defendant--the first is fully stated in the opinion of the Court, and was abandoned on the appeal. The second exception is as follows. The plaintiff offered the following prayer:

That if the jury find for the plaintiff on the fifth count in the declaration, the measure of damages is the difference between the actual cost price of the Cumberland to the defendant which the jury must find, and the amount that the jury may find the defendant falsely represented to the plaintiff the actual cost price of said steamer to have been.

And the defendant asked the following instructions:

1st. That the plaintiff is not entitled to recover in this case unless the jury believe that the defendant, by false and fraudulent representations, induced him to pay more for the interest bought by him in the steamer Cumberland than said interest was actually worth, and if the jury so believe, then the plaintiff is only entitled to recover the excess so paid by him, over and above the actual value of said interest at the time of said purchase.

2d. That even if the jury believe that the defendant, by false and fraudulent representations, induced the plaintiff to pay more for the interest bought by the plaintiff in the steamer Cumberland than the defendant had paid therefor, the plaintiff is not entitled to recover more than the difference between the actual value of said interest and the amount paid by the plaintiff therefor.

The Court granted the prayer of the plaintiff and rejected those of the defendant; to this ruling the defendant excepted, and the verdict and judgment being against him, he appealed.

The cause was argued before BARTOL, C.J., NELSON, STEWART, MILLER and ALVEY, J.

John H. Thomas, for the appellant:

If the appellee were required to pay, and supposed he was paying, an eighth, not of the value of the steamer, but an eighth of the cost price, he might, on finding that he had been deceived, have treated the contract as a nullity, and have sought to recover back the purchase money. But he retained the interest he had acquired, and sought to recover damages for the deceit. Those damages were only the difference between the value of what he had bought and the price he had paid for it. If actually worth as much as he had paid, it was damnum absque injuria, which entitled him only to nominal damages.

If the appellant had received the purchase money and refused to convey the stipulated eighth of the steamer, the measure of damage, in the absence of any special damage alleged and proven, would have been the value of that eighth interest at the time when it ought to have been conveyed. The appellee had the benefit of that eighth interest. It of course ought to have been deducted from what he would have been entitled to recover if he had not had it. This was the precise measure of damage which the appellant by his prayers asked to have prescribed, and which the Court refused.

Even if the appellee was entitled to recover the difference between the actual cost price to the appellant of the interest which the appellee bought, and the amount the appellant represented said actual cost price to have been, he was certainly not entitled to recover eight times that amount. He bought but one-eighth of her. The measure of damages prescribed by the Court's instruction was not the difference between the actual and pretended cost price of that eighth-- but between the actual and pretended cost price of the entire steamer. That the jury did not actually allow as much, cannot be considered by this Court. The instruction was erroneous, and it is impossible to tell, and it is improper to speculate, whether the jury were or were not in point of fact misled by the error. If the measure of damages prescribed by the Court were wrong, the judgment ought to be reversed.

Damages are recoverable for misrepresentations as to the condition quality, productiveness, or yield of property, or other facts which affect its value. The fact of the appellant having paid one price or another for his interest did not in the slightest degree affect its value. It was only the estimate he had at one time formed--one criterion of its value. Harvey vs. Young, Yelv., 21; Van Epps vs Harrison, 5 Hill, (N. Y.,) 69, 70; Vernon vs. King, 12 East, 636.

The rule which sometimes entitles a plaintiff to recover the difference between what property would have been worth, if false representations made in reference to it had been true, and what it was actually worth, is not applicable to this case. The representations were not such as affected its value, whether true or false. The rule is applicable to cases in which the quality, condition, yield or worth of property are fraudulently misrepresented. In a case like the present, the party deceived may be entitled to recover nominal damages, but beyond them, only what he has actually sustained. Tuck well vs. Lambert, 5 Cush., 23; Singleton's Adm'r vs. Kennedy, Smith & Co., 9 B. Monroe, 226; Sedgwick on Damages, (4 th Ed.,) 259 top, 229 margin.

If exemplary or punitive damages were recoverable, the amount of them was within the discretion of the jury, and it was error in the Court to prescribe a measure of them. Day vs. Woodworth, 13 How., 369.

H. Clay Dallam and Charles Marshall, for the appellee:

The prayer of the plaintiff assumes that the jury would consider the law, as therein laid down, in connection with the fifth count. That count contains the allegation that the plaintiff had been induced to give one-eighth of a sum greater than the actual cost price of the steamer, for one-eighth interest in her. Although the prayer states that the measure of damages is the difference between the cost price and the sum falsely represented as the cost price, yet, taken in connection with the count to which it refers, there is no error or ambiguity, as the count is for deceit as to an eighth interest, and not as to the whole. The prayer was so understood and applied by the jury, as is evident from the amount of their verdict. And it is literally true, that one-eighth of the difference between two sums is precisely the same as the difference between one-eighth of each.

In a suit for an over-payment for an eighth interest in a vessel it is just as proper to direct the jury to find the whole amount of the excess charged, and take an eighth of it, as to find an eighth of the true price and an eighth of the false price, and deduct one from the other. If the principle of the prayer be right, the defendant sustained no injury by the form of it, as is clear from the verdict, which is exactly one-eighth of the difference between the actual cost price and the alleged cost price, with interest added from the day of payment to the day of the verdict. This being so, even if the form of the prayer be objectionable, the defendant was not injured, and it constitutes no ground of reversal. Higgins vs. Carlton & Scaggs, 28 Md. Rep., 115; ...