Fraud renders contracts voidable.

of fraud.

§ 428. FRAUD renders all contracts voidable (a) ab initio both at law and in equity. No man is bound by a bargain into which he has been deceived by a fraud, because assent is necessary to a valid contract, and there is no real assent where fraud and deception have been used as instruments to control the will and influence the assent. Although fraud has Definitions been said to be "every kind of artifice employed by one person for the purpose of deceiving another," courts and law-givers have alike wisely refrained from any attempt to define with exactness what constitutes a fraud, it being so subtle in its nature, and so Protean in its disguises, as to render it almost impossible to give a definition which fraud would not find means to evade. (a1) The Roman jurisconsults attempted definitions, two of which are here given: "Dolum malum SERVIUS quidem ita definit, machinationem quandam alterius decipiendi causa, cum aliud simulatur, et aliud agitur. LABEO autem, posse et sine simulatione id agi ut quis circumveniatur : posse et sine dolo malo aliud agi, aliud simulari; sicuti faciunt qui per ejus modi dissimulationem deserviant, et tuentur vel sua vel aliena: Itaque, ipse sic definit, dolum malum esse omnem calliditatem, fallaciam, machinationem ad circumveniendum, fallendum, decipiendum alterum adhibitam. Labeonis definitio vera est." Dig. 1. iv. t. 3, l. 1, § 2. The Civil Code of France, without giving a definition, provides, in Art. 1116: "Fraud is a ground for avoiding a contract when the devices (les manoeuvres) practised by one of the parties are such as to make it evident that without these devices the other party would not have contracted."

(a) [Adams v. Nelson, 22 U. C. Q. B. Mr. Justice Doe upon this subject in 199.] Stewart v. Emerson, 52 N. H. 313, 314.]

(a1) [See the valuable suggestions of

§ 429. However difficult it may be to define what fraud is in all cases, it is easy to point out some of the elements which must necessarily exist before a party can be said at common law to have been defrauded. In the first place, it is essential that No fraud unless the means used should be successful in deceiving. (b) party is deHowever false and dishonest the artifices or contriv- ceived. ances may be by which one man may attempt to induce another to contract, they do not constitute a fraud if that other knows the truth, and sees through the artifices or devices. (e) Haud enim decipitur qui scit se decipi. (d) If a contract is made under such circumstances, the inducement or motive for making it is ex concessis, not the false or fraudulent representations, which are not believed, but some other independent motive. (e) Next, it is now

(b) [Doggett v. Emerson, 3 Story, 732, 733; Bowman v. Carithers, 40 Ind. 90; Hagee v. Grossman, 31 Ib. 223; Mason v. Crosby, 1 Wood. & M. 342 Clark v. Everhart, 63 Penn. St. 347; Attwood v. Small, 6 Cl. & Fin. (Am. ed.) 233, and note (2) and cases cited, 444; Vigers v. Pike, 8 Ib. (Am. ed.) 562, 650; Vandewalker v. Osmer, 65 Barb. 556; Taylor v. Fleet, 1 Ib. 471; Phipps v. Buckman, 30 Penn. St. 402; Morris Canal Co. v. Everett, 9 Paige, 168; Stebbins v. Eddy, 4 Mason, 414; 2 Chitty Contr. (11th Am. ed.) 1036, 1039, and note (z); Smith v. Newton, 59 Ga. 113; Gunby v. Sluter, 44 Md. 237;

Need not have been the sole inducement.

Bruce. Burr, 67 N. Y. 237. But it is not necessary that the fraudulent means used should have been the sole inducement to the contract. Shaw v. Stine, 8 Bosw. 157; Clarke v. Dixon, 6 C. B. N. S. 453; Smithe. Kay, 7 H. L. Cas. 750, 775; Rawlins v. Wickham, 3 De G. & J. 304; Traill v. Baring, 33 L. J. Ch. 521, 527; Reynell v. Sprye, 1 De G., M. & G. 660; Kerr F. & M. (1st Am. ed.) 74, 75; Hersey v. Benedict, 15 Hun, 282; Morgan v. Skiddy, 62 N. Y. 319. The presumption, in the absence of evidence to the contrary, would be that false representations made by one party were relied upon by the other. Holbrook v. Burt, 22 Pick. 546. But see Taylor v. Guest, 58 N. Y. 262; Sims v. Eiland, 57 Miss. 607; Merriam v. Pine-City Lumber

Co. 23 Minn. 314; Jackson v. Collins, 39
Mich. 557.]

Right to rely
upon posi-

tive repre

sentation of
another.

(c) [Where a man has received the pos-
itive representation or assur-
ance of another as to a mate-
rial fact, he has a right to
rely upon it, so far as that
other is concerned, and is not bound to
make any further inquiry. Vigers v. Pike,
8 Cl. & Fin. 562, 650; Kisch v. Central
Venezuela Railway Co. 3 De G., J. & S.
122; S. C. L. R. 2 Ch. Ap. 114; S. C. L.
R. 2 H. L. 99, 120, 121; Kerr F. & M. (1st
Am. ed.) 79, 255; Kerr Inj. 39; Wilson
v. Short, 6 Hare, 366, 375; Reynell v.
Sprye, 1 De G., M. & G. 710; Rawlins v.
Wickham, 3 De G. & J. 319; Smith's
case, L. R. 2 Ch. Ap. 614; Perfect v. Lane,
3 De G., F. & J. 369; Cony beare v. The
New Brunswick & Canada Railway Co. 1
Ib. 578, and notes; S. C. 9 H. L. Cas., 711;
Boyce v. Grundy, 3 Peters, 210; Young v.
Harris, 2 Ala. 108; Clopton v. Cozart, 13
Sm. & M. 363; Bean v. Herrick, 12 Maine,
262; Vandewalker v. Osmer, 65 Barb.
556; Rose v. Hurley, 39 Ind. 82, 83; Mead
v. Bunn, 32 N. Y. 275; Deveber v. Roop,
3 Pugsley (N. B.), 295; Thome v. Pren-
tiss, 83 Ill. 99; Merchants' Bank v. Sells,
3 Mo. App. 85.]

(d) [See Morse v. Rathbun, 48 Mo. 91;
Howell v. Biddiecomb, 62 Barb. 131.]
(e) [In order that a misrepresentation
may support an action at law, or be a

well settled that there can be no fraud without dishonest intention, no such fraud as was formerly termed a legal fraud. Therefore, however false may be the representation of one party to another to induce him to make a contract, there is no ground for avoiding it as obtained by fraud, if the party making the representation honestly believed it to be true, (ƒ) although other remedies are sometimes available

the plaintiff to make the pur- defendant chase, the defendant stated, as of his own knowledge, mate- always justirial facts susceptible of knowledge, which were false, and the plaintiff, relying upon his statements so made, was thereby induced to purchase the goods, (f) [See Cooper v. Lovering, 106 Mass. the defendant is liable, notwithstanding 78, 79; Brown v. Castles, 11 Cush. 348- proof that he was himself misinformed as 351; McDonald v. Trafton, 15 Maine, to the facts. Such evidence would not