Wade v. Ford Motor Co.

• Decision Date: 03 January 1961
• Citation: 171 N.E.2d 282,341 Mass. 596
• Parties: Herman J. WADE et al. v. FORD MOTOR COMPANY et al.
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court

Page 282

171 N.E.2d 282

341 Mass. 596

Herman J. WADE et al. v. FORD MOTOR COMPANY et al.

Supreme Judicial Court of Massachusetts, Essex.

Argued Dec. 5, 1960.

Decided Jan. 3, 1961.

Claude R. Branch, Boston, for defendants.

John A. McNiff, Peabody, for plaintiffs.

Before WILKINS, C. J., and SPALDING, WILLIAMS, CUTTER and KIRK.

SPALDING, Justice.

This action in tort for deceit is brought severally by three plaintiffs, seeking damages from each of three defendants, severally. The defendant Ford Motor Company (hereinafter called Ford) demurred on the grounds that the plaintiffs' declaration, as amended, (1) failed to state a cause of action and (2) improperly joined the plaintiffs and the defendants in one action. An order was entered sustaining the demurrer, from which the plaintiffs appealed. G.L. c. 231, § 96.

The declaration ¹ alleged that for a long time prior to March, 1958, Rowe Motor Company, Inc. (Rowe), was an authorized Ford dealer; that in March, 1958, Ford 'cancelled and revoked' Rowe's dealer's franchise; that 'thereafter by knowingly allowing * * * Rowe * * * to continue to hold itself out to the public as a Ford dealer, to continue to prominently display the * * * [Ford] name and trade mark on its * * * premises, to continue to use * * * [Ford's] name and trade mark in its written advertising, and to continue to display the ostensible outward signs of a Ford dealer duly enfranchised * * *, [Ford] falsely and fraudulently represented to the plaintiff that * * * Rowe * * * was * * * authorized * * * to receive from * * * [it] and sell Ford vehicles'; that 'Rowe * * * was not a Ford dealer under a franchise'; and that the 'plaintiff on or about July 26, 1958, as a consequence of relying upon * * * [Ford's] false representation paid money and delivered a used vehicle * * * to Rowe * * * for * * * [a car] and * * * [lost the] money and car, all to his great damage.'

The declaration failed to state a cause of action and the demurrer was rightly sustained on this ground.

The plaintiffs contend, in substance, that Ford can be found liable in tort for deceit for failing to take any measures to curb or expose Rowe's unauthorized use of the 'ostensible outward signs' of an authorized Ford dealer. It is not alleged that Ford itself did anything to misrepresent the facts or in any way participated in the transactions between Rowe and the plaintiffs or authorized or adopted the misrepresentations of Rowe. Compare Lantin v. Goodnow, 207 Mass. 291, 302-303, 93 N.E. 843. The allegations are nonfeasance but the circumstances show no duty to speak or act. See Tilden v. Greenwood, 149 Mass. 567, 22 N.E. 45; Stewart v. Joyce, 201 Mass. 301, 311-312, 87 N.E. 613; Swinton v. Whitinsville Sav. Bank, 311 Mass. 677, 679, 42 N.E.2d 808, 141 A.L.R. 965, and cases cited; Sandler v. Elliott, 335 Mass. 576, 590, 141 N.E.2d 367; Restatement: Torts, § 551. Indeed, the absence of duty is clearer here than in the Swinton case, because Ford was a stranger to the transactions between Rowe and the plaintiffs. Where there is no duty to act or speak, the characterization of the defendant's actions as false and fraudulent does not save the declaration. See Swinton v. Whitinsville Sav. Bank, 311 Mass. 677, 678, 42 N.E.2d 808, 141 A.L.R. 965. We assume that Ford could have taken steps to curtail or expose the activities of Rowe, but we are not prepared to say that it is a legal wrong for one to fail in such circumstances to pursue his legal rights. ² We recognize, as the plaintiffs argue, that a fraud 'may be perpetrated by an implied as well as by an express representation.' Robichaud v. Owens-Illinois Glass Co., 313 Mass. 583, 585, 48 N.E.2d 672, 674. But the cases relied upon by the plaintiffs, Lobdell v. Baker, ...