African Metals Corp. v. Teeter

262 A.D. 698, 30 N.Y.S.2d 949, 1941 N.Y. App. Div. LEXIS 5460

Opinions

Per Curiam.

The judgment in favor of the defendants Teeter and Bullowa should be affirmed.

We think, however, the complaint as against the defendant Meade should not have been dismissed at the conclusion of the plaintiffs’ case. The jury could have found that the second cause of action for fraud asserted by each of the plaintiffs was established by the evidence as against the defendant Meade.

It has been directly held that, in an action for rescission in equity, an agent who has made fraudulent representations is hable to restore the consideration even though the principal, and not the agent, has received the benefit of the sale. (Mach v. Latta, 178 N. Y. 525; Keshal v. Modrakowski, 249 id. 406; Loud v. Clifford, 254 id. 216; Lehman-Charley v. Bartlett, 135 App. Div. 674; affd., 202 N. Y. 524.) There is no reason to hold that the same rule does not apply where the action is at law to recover the consideration. In most particulars actions at law based on a rescission have been assimilated with actions in equity seeking analogous relief. (Compare Seneca Wire & Mfg. Co. v. Leach & Co., 247 N. Y. 1.)

The judgment in favor of the defendants Teeter and Bullowa should be affirmed, with costs. The judgment in favor of the defendant Meade should be reversed, the action severed, and a new trial ordered, with costs to the appellants to abide the event.

Glennon, Untermter and Callahan, JJ., concur; Martin, P. J., and Dore, J., dissent as to the defendant Bullowa and vote to reverse and order a new trial as to said defendant.