Eaton, Cole & Burnham Co. v. Avery

This is an action for deceit, in obtaining the sale and delivery of goods to the firm of Avery & Riggins, by means of false representations made by the defendant as to the pecuniary condition of his firm. The representations charged were not made directly by the defendant to the plaintiff, but are alleged to have been made by him to a mercantile agency (Dun, Barlow & Co.), or its agent, and by it communicated to the plaintiff, who claims that it delivered the goods to Avery & Riggins on credit, on the faith of such representations. The counsel for the defendant contends that the plaintiff cannot maintain an action against the defendant for false representations made by him to Dun, Barlow & Co., or its agent, and that such representations, assuming them to have been made, are not sufficiently connected with the dealing between the defendant and the plaintiff to enable the latter to recover by reason thereof. On this point we are of opinion that the law was correctly stated by the learned judge before whom the trial was had, in his charge to the jury, wherein he instructed them that if the defendant, when he was called upon by the agent of Dun, Barlow & Co., made the statements alleged in the complaint as to the capital of the firm of Avery & Riggins, and they were false, and so known to be by the defendant, and were made with the intent that they should be communicated to and believed by persons interested in ascertaining the pecuniary responsibility of the firm, and with intent to procure credit and defraud such persons thereby, and such statements were communicated to the plaintiff and relied upon by it, and the ■ alleged sale was procured thereby, the plaintiff was entitled to recover. The rule thus laid down accords with the principle of adjudications in analogous cases, in which it has been held that it is not essential that a representation should be addressed directly to the party who seeks a

The counsel for the appellant is undoubtedly right in his general proposition that a false representation made to one person cannot give a right of action to another to whom it may be communicated, and who acts in reliance, upon its truth. If A. casually or from vanity makes a false or exaggerated statement of his pecuniary means to B. or even if he does so with

In Commonwealth v. Harley ( 7 Metc. 462 ), the prisoner was indicted for obtaining goods by false pretenses from G. B. & Co. The representations were made by one Cameron, in the absence of the prisoner Harley, to a clerk of G. B. & Co. who communicated them to a member of the firm. But there was evidence that they were made by Cameron with the approbation and direction of Harley, and these facts were held sufficient to sustain a conviction. Neither is it necessary that there should be an intent to defraud any particular person. Should A. make a false statement of his affairs to B. and then publicly hold out B. as his reference, can it be doubted that he would be bound by the communication of his statement by B. to any person who might inquire of him in consequence of this reference ? That case differs from the present one only in the fact that here there was no express invitation to the public to call upon Dun, Barlow & Go. for information. But the defendant knew that they were a mercantile agency whose business it was to give information as to the standing and means of dealers, and that it was resorted to by merchants to obtain such information. By making a statement of the financial condition of his firm to such an agency he virtually instructed it what to say if inquired of. Can it make any difference whether he spontaneously went to the agency to furnish the information or whether he gave it on their application ? He must have known that the object of the inquiry was not to satisfy mere curiosity, but to enable the

The case is a new one in its facts, but the principles by which it should be governed are well established.

The further question arises on this appeal, whether there was sufficient evidence to justify the submission of the ease to the jury under the rule of law which has been stated, or whether the motion for a nonsuit should be granted. In considering this question we must lay out of view the evidence on the part of the defendant, which is contradictory of that on the part of the plaintiff, but which is largely relied upon in the statement of the case in the points of the appellant, and we must put the most favorable construction upon the plaintiff’s evidence. The evidence on the part of the plaintiff is in substance as follows : An employee of Dun, Barlow & Co., a mercantile agency, testified that in August, 1875, he applied to the defendant for a statement of the means of defendant’s firm, to be reported to Dun, Barlow & Co.; that he presented to defendant the card of Dun, Barlow & Co., and informed him of the object of his visit, and the defendant professed himself pleased to give all the information pertaining to his business which Dun, Barlow & Co. required; that he then stated that the capital of the firm was $20,000, chiefly furnished by himself, and that the capital so contributed by him was in money, and then went on to give further particulars. The employee reduced the statement to- writing, and, afterward transcribed it in the books of Dun, Barlow & Co. Mr. Eaton, the president of the plaintiff, testified that in September, 1875, the defendant applied to him to sell to his firm some goods on a credit of thirty days; that before making the sale and while the matter was under advisement, he (Eaton) sent to the office of Dun, Barlow & Co. for information as to the responsibility of Avery & Biggins, and they sent him an answer in writing, which, after he had examined it, he put in his record book. This paper the witness produced at the trial, and he testified that in the following February, after the defendant had failed to pay for the goods, he, the witness, read to the defendant the identical

This evidence is substantially corroborated by Mr. Cole. The sale and delivery of the goods was shown, and only a portion of the price was ever paid, and Avery & Biggins went into bankruptcy early in the following year.

Biggins, the partner of the defendant, testified that the defendant did not contribute any capital to the firm of Avery & Biggins, either in' money or property; but he, the witness, contributed about $6,000 worth of tools, which, when Avery came with him, he rated at $4,000, of which Avery was to pay $2,000, but that he had not paid it and the firm stopped business in February, 1876.

This witness further testified that in August, 1875, the defendant said to witness that he was going down to the commercial agency, and was there going to put this property in the name and to the credit of the concern. That he afterward came back, and said he had rated the firm at $25,000.

There is much more evidence in the case. Most of the inculpatory statements contained in the testimony on the part of

For these reasons we think that the motion for a nonsuit was properly denied. There are numerous exceptions to rulings on questions of the admissibility of evidence, and we have examined them all; but, without going into detail, our conclusion is that no error was committed in this respect which would justify a reversal of the judgment. The most important exception in the case is to the refusal of the judge to charge as requested, “ that the jury might take into consideration whether the report made to the plaintiff by Dun, Barlow & Co., coupled with conditions and distrust in such a way as it was, was such a statement as a prudent man would rely on.” The conditions and distrust here referred to, are the statement

“ The actual verity of this or any other information obtained through the mercantile agency is in no manner guaranteed by the said agency or the proprietors thereof, for, notwithstanding every effort, mistakes and misapprehensions may occasionally occur.”

These cautions related rather to the responsibility of Dun, Barlow & Co., for the accuracy of the information which they communicated, than to that of the defendant for the truthfulness of that which he lodged with them for the pmposes of their agency. Still, we think that the defendant was entitled to have the jury instructed in some form, that they might take into consideration whether the report, such as it was, was calculated to mislead a prudent man. If a refusal so to charge had stood uncorrected a serious question would have been presented. The judge, in refusing the request, expressed his own opinion that the plaintiff had the right to rely upon the statement, but immediately afterward, on the concession of the plaintiff’s counsel, the judge modified his refusal and charge, and submitted the question to the jury in such an unequivocal and clear manner that they could not have misapprehended it. He charged them that if they found upon all the evidence in the case that the statement that came to the plaintiff was not a statement that was likely to deceive a prudent person, they

The other exceptions have already been sufficiently covered; we find none which in our judgment should be sustained.

The judgment should be affirmed.

All concur.

Judgment affirmed.