Francis H. (Francis Hermann) Bohlen.

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fendant, at the time of the said purchase, wrongfully and fraudu-
lently represented to plaintiff that said sheep purchased of him
were sound and healthy and free from any disease ; although the
sheep were apparently sound and healthy, were not sound and
healthy as the defendant then well knew. The plaintiff on or about
the first day of December purchased of his brother all of the latter's
sheep, including those purchased of the defendant, solely relying, as
to the soundness of said sheep, upon his own knowledge of said
1,100 owned by his brother and relying upon the representations of
the defendant as to the soundness of those purchased of him. The
plaintiff avers that the said sheep purchased of the defendant were,
at the time of the purchase, unsound, and had a disease known as
foot rot, which is contagious and which was communicated to the



^ The facts of the petition are considerably abridged.



WELLS V. COOK. •J2T)

rest of the flock, by the turning in with them of the sheep purchased
by the defendant. And tlic defendant further avers that at the time
of the purchase from his brother, that the disease had not made its
appearance in his brother's flock so as to be noticed by the plaintiff
or his brother, but it had since broken out among tlie said flock
so as to render them ahnost entirely valueless. To the damage of the
plaintiff four thousand dollars, for which he prays judgment.

To this petition the defendant demurred, on the ground that
the same does not state facts sufficient to constitute a cause of action.
The court sustained the demurrer, and thereupon gave judgment for
the defendant. The plaintiff', to reverse this judgment, filed his
petition in error in the district court, alleging for error the sustain-
ing of the demurrer to his petition in the court below, and the case
was thence reserved for decision in this court.

Brinkeriioff, C. J. The question is, whether the state of
facts set forth in the petition constitutes a cause of action. The
question is one of some difficulty ; and the facts, as alleged, make a
case which strongly inclines the mind to sustain the action, if that
can be done without so far trenching upon established rules of law
as to amount to judicial legislation. We have, therefore, held the
case for some time under advisement, and have bestowed upon it the
best consideration of which we are capable, but have been compelled
to the unanimous conclusion that the court below was right — that,
upon the facts alleged, no action can be sustained.

Lord Campbell, in GcrJiard v. Bates, 20 E. L. & E. R. 136,
lays down the rule thus: "If A fraudulently makes a representation
which is false, and which he knew to be false, to B, meaning that
B shall act upon it, and B, believing it to be true, does act upon it,
and thereby suffers a damage, B may maintain an action on the case
for deceit." We have been able to find no case which transcends
the limits thus defined — no case which purports to hold, or is decided
on the principle, that if A makes a false and fraudulent representa-
tion to B, meaning that C, and C alone, shall act upon it, and B
thereupon assumes to act upon it, and suffers damage, B can main-
tain an action against A for the deceit. And as transactions of the
kind last supposed must be of frequent occurrence in every com-
mercial country, the fact that no such case can be found, is strong
evidence that such a doctrine is unknown to the law. And the case
last above supposed, is, really, the case before us. The representa-
tions complained of were not made to the plaintiff', meaning that the
plaintiff should act upon them in any manner or matter affecting his
own interests, but were made to the plaintiff, acting as the avowed
agent of his brother, simply in a representative capacity, meaning
that the brother should act upon them ; and the fact that the brother
was meant to act upon them, through the plaintiff, as his agent, can-
not, it seems to us, alter the case in any legal aspect.

The cases which seem most nearly to approach a doctrine which
it would be necessary to hold in order to sustain this action, are
Thomas v. Winchester, 2 Selden's R. 397, and Langridge v. Levy,
2 M. & W. 518, and same case on error, 4 M. & W. t,t,6.



724 WELLS v. COOK.

In the former case it was held, that "a dealer in drugs and
medicines, who carelessly labels a deadly poison as a harmless medi-
cine, and sends it, so labeled, into market, is liable to all persons,
who, without fault on their part, are injured by using it as such
medicine in consequence of the false label/' and this "though the
poisonous drug with such label may have passed through many inter-
mediate sales before it reaches the hands of the person injured." In
that case, the article sold purported to be a medicine, was intended
for retail in minute quantities, and to be administered in doses to a
great number of persons. And the court regarded the accompanying
label as a continuous representation to, and intended to be acted on
by, whomsoever it might concern ; that the article was what its label
purported. In these particulars, and others, the case differs from
that before us, and falls short of being conclusive of it, if the case
be accepted as authority. It is worthy of remark, however, that
Gardiner, J., in his concurring opinion, places his concurrence solely
on the ground that the sale of the poison, without a label indicating
that it was a poison, was declared a misdemeanor by a statute of
New York.

(The discussion of Thomas v. Winchester is omitted.)
In the latter case, Langridge v. Levy, the plaintiff's father
bought of the defendant, avowedly for the use of himself and his
sons, a gun, which the defendant falsely and fraudulently warranted
to be of the make of one N, and to be a good, safe and secure gun ;
whereas the gun was not made by N., but by an inferior maker, and
was unsafe, ill-manufactured, dangerous and unsound ; of all which
the defendant, at the time of the warranty, had notice ; and the plain-
tiff knowing and confiding in the warranty, used the gun, which but
for the warranty he would not have done ; and the gun, being in the
hands of the plaintiff, by reason and wholly in consequence of the
unsoundness, etc., burst and injured the plaintiff, etc. The action
in the court of Exchequer was held to be maintainable, and the
judgment was afterwards affirmed on error. Parke, B., in deliver-
ing the opinion of the court, indicates so clearly the distinctions be-
tween the case and the one now before us, that I quote him at some
length. He says: "It is clear that this action cannot be supported
upon the warranty as a contract, for there is no privity in that re-
spect between the plaintiff and the defendant. The father was the
contracting party with the defendant, and can alone sue upon that
contract for the breach of it. The question then, is, whether
enough is stated on this record to entitle the plaintiff to sue, though
not on the contract ; and we are of the opinion that there is, and that
the present action may be supported. We are not prepared to rest
the case upon one of the grounds on which the learned counsel for
the plaintiff sought to support his right of action ; namely, that
wherever a duty is imposed on a person by contract or otherwise,
and that duty is violated, any one who is injured by the violation of
it may have a remedy against the wrongdoer; we think this action
may be supported without laying down a principle which would lead
to that indefinite extent of liability, so strongly put in the course of



WELLS V. COOK. 725

the arj]^iimcnt on the part of the defendant ; and we should pause be-
fore we made a precedent, by our decision, which would be an au-
thority for an action against the vendors, even of such instruments
and articles as are dangerous in themselves, at the suit of any person
whomsoever in whose hands they might happen to pass, and who
should be injured thereby. We do not feel it necessary to go to that
length, and our judgment proceeds upon another ground. If the
instrument in question, which is not of itself dangerous, but which
requires an act to be done, that is, to be loaded, in order to make it
so, had been simply delivered by the defendant, without any contract
or representation on his part, to the plaintiff, no action would have
been maintainable for any subsequent damage which the plaintiff
might have sustained by the use of it. But if it had been delivered
by the defendant to the plaintiff, for the purpose of being so used by
him, with an accompanying representation to him that he might
safely so use it, and that the representation had been false to the
defendant's knowledge, and the plaintiff had acted upon the faith
of it being true, and had received damage thereby, then there is no
question but that an action would have lain, upon the principle
of a numerous class of cases, of which the leading one is that of
Paslcy V. Freeman, 3 T. R. 51 ; which principle is, that a mere
naked falsehood is not enough to give a right of action ; but if it be
a falsehood told with an intention that it should be acted upon by the
party injured, and that act must produce damage to him ; if, instead
of being delivered to the plaintiff immediately, the instrument had
been placed in the hands of a third person, for the purpose of being
delivered to and then used by the plaintiff, the like false representa-
tion being knowingly made to the intermediate person to be com-
municated to the plaintiff, and the plaintiff had acted upon it, there
can be no doubt but that the principle would equally apply, and the
plaintiff' would have had his remedy for the deceit ; nor could it make
any difference that the third person also was intended to be deceived
by the defendant ; nor does there seem to be any substantial distinc-
tion if the instrument to be delivered, in order to be so used by the
plaintiff", though it does not appear that the defendant intended the
false representation itself to be communicated to him. There is a
false representation made by the defendant, with a view that the
plaintiff should use the instrument in a dangerous way, and, unless
the representation had been made, the dangerous act never would
Tiave been done. If this view of the law be correct, there is no doubt
that the facts which upon this record must be taken to have been
found by the jury bring this case within the principle of those re-
ferred to. The defendant has knowingly sold the gun to the father,
for the purpose of being used by the plaintiff by loading and dis-
charging it, and has knowingly made a false warranty that it might
be safely done, in order to effect the sale; and the plaintiff, on the
faith of that warranty, and believing it to be true, (for that is the
meaning of the term 'confiding',) used the gun, and thereby sus-
tained the damage which is the subject of this complaint. The
warranty between these parties has not the effect of a contract ; it



^26 WELLS V. COOK.

is no more than a representation ; but it is no less : The deUvery
of the gun to the father is not, indeed, averred ; but it is stated that,
by the act of the defendant, the property was transferred to the
father, in order that the son might use it ; and we must intend that
the plaintiff took the gun with the father's consent, either from his
possession or from the defendant's ; for we are to presume that the
plaintiff' acted lawfully, and was not a trespasser, unless the contrary
appear. We therefore think, that as there is fraud, and damage, the
result of that fraud, not from an act remote and consequential, hut
from one contemplated hy the defendant at the time as one of its
residts, the party guilty of the fraud is responsible to the party
injured. We do not decide whether this action would have been
maintainable if the plaintiff had not known of and acted upon the
false representation ; nor whether the defendant would have been
responsible to a person not within the defendant's contemplation at
the time of the sale, to whom the gun might have been sold or
handed over. We decide that he is responsible in this case for the
consequences of this fraud whilst the instrument w^as in the posses-
sion of a person to whom his representation was either directly or
indirectly communicated, and for whose use he knew it was to be
purchased."

It will be seen that, in order to render the case before us anal-
ogous to that of Langridge v. Levy, it would have been necessary for
the plaintiff, at least, to have alleged that the diseased sheep were
purchased for the avowed purpose of turning them in with other
sheep of his own ; but it does not even appear that, at that time, he
had any sheep of his own, or that he expected to have any. And in
the subsequent case of Winterhottom v. Wright, lo M. & W. 107,
Lord Abinger declares that the case of Langridge v. Levy has been
much misapprehended, and that the principle of that case ought not
to be extended.

The influences of human conduct, good or bad, are far-reaching,
and are often seen and felt in consequences exceedingly remote, but
uncertain and complicated. It is simply impossible that municipal
law should take cognizance of all these consequences. From neces-
sity, a large share of them must be left to the jurisdiction of public
opinion, individual conscience, and, finally, to the retributions of an-
other world. There must, somewhere, be a fixed limit between the
near and remote, direct and indirect consequences beyond wh it^h
the law will not take cognizance of them. And in this case we are?
satisfied that one of the prescribed limits is this — that the false and\
fraudulent representations must have been intended to be acted on, j
in a matter affecting himself, by the party who seeks redress for
consequential injuries. If this limit is to be extended, it must be the!
work of the legislature. "^

We have considered this case solely upon principles of the com-
mon law ; for, under the ruling of this court, in Vining v. Bricker,
14 Ohio vSt. 331, the act of February 19th, 1837, "to prevent the
spread of disease among sheep," leaves the civil rights and remedies



TINDLF, t'. CIRKETT. 'J2'J

of parties sustaining damage by reason of the sale of diseased sheep,
unchanged.

Judgment affirmed.
Scott, Day, White and Welch, J J., concurred.^



\g 7. TINDLE V. BIRKETT.
New York Court of Appeals. 171 X. Y. 520 (1902).

O'Brien, J. The plaintiffs sought to recover in an action based
jipon allegations of fraud and deceit practiced upon them by the de-
fendant, the price of three bills of goods which they were induced by
such fraud to sell to a firm of dealers of which the defendant was a
member. The firm was comi)osed of the defendant and another
person who died before the trial, and by an order of the court the
action was continued against the defendant. At the trial before the
court and a jury the plaintiffs were nonsuited and their counsel
excepted and this exception presents the question of law in the case.
The judgment was affirmed on appeal.

There is practically no dispute about the facts and the question
presented by the appeal is whether the plaintiff's proof did not
sustain or tend to sustain the action. The three bills of goods were
sold and delivered by the plaintift's to the firm at the following dates
respectively: November 30th, 1898, January 24th, 1899, and March
25th, 1899, a"<i amounted in aggregate to $901.86. On the 15th day
of April following the last sale both members of the firm were
adjudged bankrupts on their own petition in the Federal court.
About eighteen months prior to filing the petition and on the i6th
of September, 1897, the defendant, for the purpose of securing a
rating by the mercantile agency of R. G. Dun & Co., made and de-
livered to that agency a statement in writing as to the financial con-
dition of the firm, which showed net assets of $152,858.22. i\Iore
than a year thereafter and on the 2d day of November, 1898, in
reply to a request from the agency, the defendant w^rote a letter
in which he practically reiterated his former statement and added



'See accord. Thorp v. Smith. 18 Wash. 277 (1897). plaintifif's agent
bought property from' defendant. He caused defendant to recite a larger
consideration than that actually paid, representing that the property was to
be turned over to a company to be formed from which he and the plaintiff
desired to obtain a large price, in fact the agent used the recital to defraud
the plaintiff, his principal, and not the stockholders of the proposed company;
held that no action lay. See also, Marshall v. Hubbard, 117 U. S. 415 (1886).
vendor held not liable to plaintiff who, without his knowledge, takes original
vendee's place in the transaction.

Whether a man who has extorted a statement from one reluctant to say
anything by putting him in a position where silence would amount to an ad-
mission of a fact which it is his duty (or to his interest) to keep secret, is
entitled to rely on such statement appears not to have been decided. The facts
in Tackcy v. McBaiii. note to Polhill v. Walter, raised the question, but the
case was decided on other grounds.



728 TINDLE Z'. BIRKETT.

that the business of the firm was "large, increasing and profitable."
StiU later and on March 9th, 1899, just before the purchase of the
last two bills of goods from the plaintiffs, a representative of the
agency called upon the defendant personally and received from him
a verbal statement that there had been no material change in the
financial condition of the firm. The agency gave the firm a rating
of from $125,000 to $200,000, which was maintained and never
changed. Substantially the same rating was given to the firm by
the Bradstreet agency upon like statements and representations,
though made at an earlier date, and the defendant at all times knew
that the credit of the firm was so rated in reference books sent by
these agencies to merchants and business people. The plaintiffs
nad and used these reference books of both agencies in their busi-
ness, an"', when defendant applied for credit they consulted these
books and in reliance on the correctness of the rating, without any
other knowledge, sold and delivered the goods in question upon
credit. The statements upon which these ratings were given, at
least as to the Dun agency, were grossly false. The learned court
below correctly described this phase of the case in these words which
we can very well adopt :

"That the statement upon which the rating of the defendant's
firm was based by the mercantile agency of R. G. Dun & Co. were
grossly false, and that the plaintiffs relied upon such rating in giving
the firm credit for the goods purchased upon the several occasions
mentioned, are facts concerning which there is and can be no serious
dispute, and had such statements been made directly to the plaintiffs
under circumstances which would fairly warrant the assumption,
that they were so made by way of inducing credit, there would, of
course, be no question as to the right of the plaintiffs to maintain
an action of this character."

But the learned court held that since these false and fraudulent
statements were not made to the plaintiffs personally and directly
by the defendant, but to the agencies, and since the plaintiffs never
saw the statements themselves, but only the result of them in the
reference books, the action could not be maintained. That one mer-
chant may defraud another under modern business methods just as
effectually by a false and fraudulent statement to a commercial
agency as in any other way no one can doubt. That the defendant
did actually deceive and defraud the plaintiffs by thus putting into
circulation in the business world a false, fraudulent and fictitious
rating purporting to express his true commercial standing and finan-
cial ability is equally clear. Disregarding mere forms and methods,
it cannot be doubted that the defendant spoke false and deceitful
words to the plaintiffs through the agency just as effectually as if
.they had met face to face and the statements had been made directly
and personally. The buyer of goods may become liable to the seller
in fraud, although they have never met or seen each other, and no
personal communication that is false or fraudulent has passed be-
tween them. If the former does just what this defendant did and
procures a fraudulent rating, intending that it should be published to



TINDLE V. BIRKETT. 729

the business community and taken as true, that is fraud upon the
person who rehcs and acts upon it to his damage. But it is not nec-
essary to argue this cjuestion as an original one since it has been
dehberately decided by this court.

In Eaton, C. & B. Co. v. Avery, (83 N. Y. 31), it was held that
when a member of a firm makes statements to a commercial agency,
which he knows to be false as to the financial condition of the firm,
with the intent that the statements shall be communicated to per-
sons interested in ascertaining the pecuniary responsibility of the
firm, intending thus to procure credit and to defraud such persons,
and such statements are communicated to one who in reliance
thereon sells goods to the firm on credit, an action for deceit may be
maintained against the buyer of goods in favor of the seller who
has suffered by the fraud. That decision is controlling in the case at
bar, since the two cases are almost identical in their facts, and all
the objections urged by the learned court below to a recovery in this
case were fully answered upon principle and authority. The court
states that the case was ncw^ in its facts but old in the principle
involved, and the cases cited sustain the statement. The same prin-
ciple was stated in a more recent case. (Bliss v. Sickles, 142 N. Y.

647-) . ....

The objections urged to a recovery in a case like this are quite

untenable. It is said that it would put business men at the mercy of

commercial agencies. No one need have any fear of that, since no

business man can be affected unless he makes use of such an agency

to give information to the business w^orld of his financial condition

in order to show that he is worthy of credit, and then it is impossible

to harm him unless he makes statements that he knows to be false

for a fraudulent purpose, and if he does, there is no reason why he

should not respond to one who has suffered thereby. So, also, it is

said that these agencies procure information from other sources than

from the statement of parties seeking credit. That may be so, but

there is little danger that any one wdll be made liable in fraud for

false statements other than his own. If the defendant in this case

could show that he never made the statements referred to he would

have little difficulty in defeating this action notwithstanding the high

rating in the reference books. A party who is really innocent can

always protect himself against the unauthorized statements of

others. In this case there was clearly a false and excessive rating

which w^as justified by the statements made by the defendant, and it

is admitted that these statements were false and fraudulent and that

the plaintiffs relied upon the rating in giving the credit. Clearly, this

state of facts is a sufficient basis for a charge of fraud and deceit.

The proof was certainly sufficient to carry the case to the jury and

hence the plaintiff's were improperly nonsuited.

The judgment should be reversed and a new trial granted, costs
to abide the event.

Bartlett, J. I agree with the result reached in the prevailing
opinion for reversal. It w^as clearly error for the trial judge to



/;^0 TINDLE T'. BIRKETT.

■nonsuit the plaintiffs, and the affirmance of the judgment entered
thereon by the Appellate Division cannot be sustained.

I am of the opinion, however, that we should deal with the
question that induced the Appellate Division to sustain the nonsuit.
In the opinion of the learned court it is said : "Mercantile agencies
do not always base their rating of a person's responsibility solely
upon information obtained from the individual himself. Upon the
contrary, it is well understood that they obtain such information
from various sources, and this is especially true in cases where, as
it often happens, a business man, for various reasons best known
to himself, declines to furnish the public with any statement of his
financial condition."

It seems to be conceded that the defendant made representations
to the mercantile agency of R. G. Dun & Company that were grossly