84 N.J.L. 623 | N.J. | 1913
The opinion of the court was delivered by
The Farmers’ Canning Company of Vineland ordered, in writing from the plaintiff certain printed labels to be put upon canned goods manufactured by it. The order was signed “Farmers’ Canning Co. of Vineland, H. D. Franklin, Superintendent.” Upon this order was endorsed the following guarantee: “For a valuable consideration the undersigned do jointly and severally hereby guarantee payment to the Dunston Lithograph Company for all goods referred to in the above order.
At the close of the case counsel for the plaintiff moved to overrule the defence upon the ground that the defendant had no right to rely upon the representation of Bryan, but was bound to inform himself of the contents of the endorsement before signing it, and that his negligence in failing to do so precluded him from making the defence set up by him. The trial court granted the motion, and directed a verdict in favor
AYe consider the instruction complained of to be erroneous. Although, as a general rule, the affixing of a signature lo a written contract creates a conclusive presumption against the signer that he read, understood and assented to its terms, this rule lias one notable exception, viz., where the signature to the contract was procured by fraud or imposition practiced upon the signer with intent to deceive him as to the purport of the paper which he signs. If such fraud or imposition is employed and results in inducing the person upon whom it is practiced to put his signature to a paper which he otherwise would not have signed, he is entitled to set it up as a defence to an action brought against him by the other party to the transaction fox a breach of the contract provisions contained in the instrument. Allaire v. Hartshorne, 1 Zab. 665; Duncan, Sherman & Co. v. Gilbert, 5 Dutcher 521 ; Holcomb v. Wyckoff, 6 Vroom 35; Fivey v. Penn. Railroad Co., 38 Id. 627. And this is so notwithstanding that he might have discovered the fraud perpetrated upon him by reading the paper, and was guilty of negligence in not doing so. Alexander v. Brogley, 34 Id. 307.
Nor is the fact that the fraudulent representation which induced the signing of the paper was made by an agent without authority from his principal material in an action brought by the principal upon a contract obtained by the fraud of his agent, for it is entirely settled that if a principal seeks to enforce a contract made by his agent, he is as much bound by any material misrepresentation made by the agent as if made by himself. Alexander v. Brogley, supra. An innocent principal cannot assert any rights, or retain any benefit upon a contract which is procured by the fraud of his agent. Marsh v. Buchan, 1 Dick. Ch. Rep. 595; Reitman v. Fiorillo, 47 Vroom 815.
Under the rules of law to which we have referred, the facts testified to by Borgo constituted a complete defence to the action brought against him by the plaintiff upon his gunr
For affirmance — None.
For reversal — The Chancellor, Chief Justice, Swayze, Trenoi-iabd, Yoori-iees, Minturn, Kalisch, Bogert, Yre-DENBURGI-r, CONGDON, JJ. 10.