Bayard v. Malcolm

1 Johns. 453

Opinions

Thompson, J.

The question presented to the court, is touching the sufficiency of this declaration after verdict. It must be considered as a declaration founded upon a warranty, or upon a fraud or deceit in the sale of the establishment, in neither of which points of view, can it, I think, be supported. Without entering into an inquiry, whether a mere affirmation is to be considered as a warranty, there is a fatal objection to the declaration, if considered as one founded on the contract. It states the sale and transfer to have been made in writing, under the hands and seals of the defendants. All previous representations must be considered as conversations leading to a contract to be consummated, by the bill of sale, and as coming within the rule adopted by the court in the case of Vandervoort v. Col. In. Company, (2 Caines,161.) and in the case of Mumford v. McPherson, decided in this term. That, ■when an agreement is reduced to -writing all previous treaties are resolved into that. Whatever remedy, therefore, the defendants may have on the contract, must be on the bill of sale. If this declaration is to be supported at all, it must be as one founded on a fraud in the sale of the establishment. Here, also, are insuperable objections. The sale is not alleged to have been made fraudulently, nor that that the defendants knew their affirmations were false. 1 he-declaration, regularly, ought to proceed to charge, that the defendants knew of the matter by which, they de- .... . ; J „ / ceived, and that they did it falsely and fraudulently. An allegation of a scienter might, after verdict, supply the omission of falsely and fraudulently, or falsely and frauduient¡y import that they knew it; (3 Mod. 261. note) but one or the other is indispensable. Where there is no warranty, the s.cienter or fraud is the gist of the action. This principle has been frequently decided by the courts in England, and recognized by this court. (1 Ld. Ray. 595. 2 Ld. Raym. 1118. Doug. 20. 3 Term, 56.62. 2. East, 322,448. 2 Caines 48.) The conclusion of each count, that by reason of the said affirmations, the plaintiff was falsely and frauddulently deceived, is not sufficient. It is no more than the common conclusion of a declaration. The fraud is a substantive allegation, and must be laid in that part of the declaration which sets out the plaintiff’s cause of action, otherwise, he is not bound to prove it upon the trial. Where the action is founded on the contract of sale, the declaration usually concludes, that the defendant falsely and fraudulently deceived the plaintiff, &c. yet this is not necessai-y to be proved, not being of the essence of the declaration. (2 East, 448.)

The only remaining question is, whether the defects or omissions are cured by the verdict ? I think they are not. A verdict will not amend the matter when, the gist of the action is not laid in the declaration.' (Cowp. 826.) Lord Mansfield says, the rule is, that where the plaintiff has stated his title, or ground of action defectively or inaccurately, a verdict will cure it, because to entitle him to recover, all circumstances necessary in form or substance to complete the title so imperfectly stated, must be proved at the trial, and it is fair to presume after verdict, that they were proved. But where the plaintiff totally omits to state his title or cause of action, it need not be proved at the trial, and therefore there is no room for such presumption. (Doug. 683.) To apply this rule to the present case; what is the cause of action here ? it is a fraudulent sale of the newspaper establishment; but no such fraud is' alleged in the declaration ; it cannot therefore be presumed to have been proved. Under this declaration, all that the plaintiff would be required to prove would be, that the defendant affirmed that the number of subscribers to the paper exceeded nine hundred, and that the annual profits of the establishment exceeded §3000, and that these affirmations ivere untrue. But the- e facts would not have created a good cause of action, according to the decisions of the cases already cited, unless these affirmations were made fraudulently, or known by the defendants to be false. Thus in the case oí Buxentine v. Sharp, (3 Salk. 12.) the declaration against the defendant was for keeping a vicious bull, but it stated no scienter. This was held bad after verdict, for the action lies not, unless the owner knows of this quality, and it could not be intended that it was proved at the trial, for the plaintiff need not prove more than is laid in his declaration. (1 Term Rep. 145. 3 Mod. 261. note.) The result of my opinion, therefore, is, that the defects in the declaration are not cured by the verdict, and that the judgment must be arrested.

Spenc a, J. and Tompkins, J. concurred.

Livingston, J.

I cannot concur in this opinion. The .objection to the first count, which applies also to the other two, is the want of an averment, that the affirmations, which induced the purchase, were fraudulent. The plaintiff insists that each count contains a perfect cause of action, set forth with sufficient certainty, without any defect in form or substance ; and that if it be otherwise, yet even an omission in substance is cured by verdict at common law, if the issue necessarily. required proof of the matter imperfectly stated, or altogether omitted, and without which a judge could not direct, nor a jury consent to find, for the plaintiff.

*

- There is some difficulty in accurately defining what faults are cured by a verdict. To this point, there is much learning and a great variety of cases, not always intelligible, nor free from contradictions. There is no risk, however, in saying, that where it may with certainty be collected from the manner in which the action is laid, that the whole merits must , , . . ... .. have been tried, courts will not readily listen to reasons m arrest, of judgment., After a full and fair discussion, it is so hard and unjust to put a party to further litigation, for an error in pkad.'ng, that every struggle should be made to uphold a declaration, not radically bad, or if from, the whole of it, a good ’. can be extracted,' though not very formally set fm £h, nor in the way generally, or- most usually, . pursued,

' Whether ibis declaration stand in need of the indulgence which these remarks would seem to bespeak, I will not say, but after a very careful inspection, it does not present to me any of those glaring defects which can alone justify the extraordinary interposition that is expected from us. The omission to allege a scienter in the defendants and their agents, is the ground of objection we are now examining. Without fraud or deceit this action cannot be maintained and to render a party guilty of either, there must be not only a false affirmation, but it must be made with knowledge of its being false. Hence it follows, generally at least, that a declaration, to be perfect, must charge a defendant with knowingly having recourse to a falsehood to promote a bargain. How far this averment can be essential, when, as in the case before us, a misrepresentation is alleged to have proceeded from the vendor himself in relation to the profits of an establishment of which, for aught disclosed by the record, he may have been in possession for many years, is a point well deserving consideration. It is next to impossible for the owner of any such establishment to be ignorant whether it be lucrative, or otherwise ;.he cannot, therefore, without design, make any considerable mistake about it. But without determining on the fitness of a declaration, in a case like the present, if this averment had been wholly omitted, it is without pretence that its existence is denied here. Each count, after denying the truth of the affirmations, contains this averment—“ And so the plaintiff saith, that he by rea- “ son of the said affirmations, was falsely and fraudulently “ deceived.” At the end of the last count follows the com-«ton inclusion, “ that'the plaintiff is- therefore made1 worse 1 1 , v vC and hath "damage,” &c. •

From this statement, may it not be asked, where is the omission of which so much complaint is heard ? Is not an allegation of a party’s being• falsely and fraudulently deceived, by the representation of another, essentially the same as saying that he had been thus deceived by the person ■making the false assertion, or in other words, that the same was known to him not to be true ? This knowledge, then,.is as necessarily imputed to the defendants by this kind of averment, as by any other, because,- without it, though the -plaintiff might he deceived, he- could not be so fraudulently., which would be true only. in case the defendants told a-, wilful falsehood. No other meaning can be affixed to these terms, for such an averment necessarily charges the defendant with knowledge of the falsity of what he has said, without which there could have been .no fraudulent deception* This averment, at any rate, necessarily, and unavoidably put in issue the scienter, and rendered it incumbent on the plaintiff to prove it. If it were material to show that he was fraudulently deceived, (and he has rendered it material by his averment,) and that could only he made out by. proving that' the defendants, or their agents, knew they were .imposing on him, it follows, reasoning from the record itself, that such proof, was not only necessary, but must have been made.

It was said, on the argument, that this averment was only stated as a deduction from premises, which being wholly silent as to the fraud, did. not justify .the inference, and which, notwithstanding the situation of the parties, might be erroneous. If this were so, it belongs to the jury, and not to us, to pronounce on its correctness. Tome, however, this conclusion, if it be regarded only in that light, is not only natural, but such as must, almost universally, follow from the same premises. It is immaterial, however, whether what was disclosed in the preceding part of the declaration, warranted the averment. The plaintiff had a right to make it, and whether the basis on which it was placed, would. suPPort was a matter to be settled by á jury. He might have made it on mere suspicion, without assigning any reason, but when he gives one, which we are now to presume a jury have thought sufficient, we ought to be satisfied. If tlris declaration be not in strict conformity with precedents, yet if every material allegation may be collected from the whole of it taken together, more, after verdict, should not be required.

By some of the counsel this averment was considered as only the common conclusion of every declaration of this kind, and, therefore, as not forming a substantial, or component part of it. This is not the case, though even then it would be suffi :ient, if it put the scienter in issue. It is a distinct allegation, separate from, and unconnected with, the general conclusion, which is found only at the termination of the last count. Its introduction by the monosyllable so, which was much insisted on as evidence of its being the result of the plaintiff’s own reasoning on the matters before alleged, can do no harm, provided it be sufficiently explicit and intelligible to bring into discussion the fraud or deceit, which is the fist of the action. The rules of pleading have not appropriated any particular part of a declaration for the insertion of this averment. So that, if it be found somewhere, it is enough.

Upon the whole, every count is so framed as necessarily to put in issue the scienter of the defendants or their agents ; and that by averments, too apt and significant to be misunderstood. This case, then, does not merely fall within that class of cases, in which a court will presume that certain facts not only imperfectly stated, but altogether omitted, yet necessary to be proved, have actually been made out at the trial, which would be conclusive here, but presents the much stronger case of an issue on the very fact which it is pretended has been overlooked by counsel, and on the supposed omission of which the whole argument has turned.

Another reason assigned for arresting judgment is, that in one count the affirmation is stated as proceeding from one of the defendants solely, without alleging any authority for that purpose, from the other.

That the joint owners of any property, who are equally interested in and benefited by its sale, should answer civilly for each other’s misrepresentations, and refund what has been thus acquired, is too reasonable to require that we should take up any time in examining this objection to the declaration.

There is also a motion for a nonsuit, or new trial. On this case, it is unnecessary to decide on the points ruled at the trial of the cause ; because, if the judge were wrong in refusing a nonsuit, yet as the plaintiff, if he thought his testimony defective, might, and actually did examine other witnesses, notwithstanding the opinion in his favour, it is impossible, without a knowledge of this evidence, which it has been thought proper to keep back, to say, that a nonsuit, if we have power to grant it, without an agreement of parties, or another trial, would be proper. This further testimony might support the verdict, though a nonsuit, in the first instance, might have been right. If the defendants have made a case so imperfectly that we cannot give judgment in their favour upon it, the other party was not bound to amend it, nor is it for us to say that the testimony, which is withheld, was immaterial. The plaintiff, in my opinion, must have judgment on the postea.

2 Saunders, 228 in the notes