13 N.Y.S. 642 | N.Y. Sup. Ct. | 1891
This action was brought to recover damages which the "plaintiff .claimed to have sustained by reason of certain representations made by the defendants to the plaintiff to induce the purchase of stock in a company, which representations were claimed to be false and fraudulent. The
It is claimed upon the part of the defendants that, because the plaintiff nowhere testified that he relied solely upon these statements testified to by his father, the jury could not find a verdict in his favor. We do not understand this position to be well taken. If, from the nature of the transaction, the relation of the parties, and the circumstances surrounding the transaction, it may fairly be presumed that the plaintiff relied upon the representations in entering into the transaction, and that they were the inducing cause, the mere fact that he has or has not sworn to.the conclusion that he relied upon the representations is of little moment; in fact, it is only of recent years that such questions were permitted. But there is a more serious question, arising from the claim that there is no evidence before the court that the defendants knew the statements, or any of them, made by them, to be false. In tlie case of Morris v. Talcott, 96 N. Y. 100, the court laid down this rule in respect to the nature of the proof of scienter in eases of the description of the one at bar. They say; “The fraud charged against the defendant herein is of the nature of a crime, and cannot be presumed, but must be established by evidence. Henry v. Henry, 8 Barb. 592; Ward v. Center, 3 Johns. 281; Jackson v. King, 4 Cow. 207, While it is true that it may be proved by circumstantial evidence, and the inferences legitimately deducible therefrom, yet the defendant is entitled, in a judicial consideration of the proofs, to the application of the rule that the presumptions of the law are in' favor of the innocence of the person accused. A party, therefore, relying upon the establishment of a cause of action or a right to a remedy against another, based upon the alleged commission of a fraud by such person, must show affirmatively facts and circumstances necessarily tending to establish the probability of guilt, in order to maintain his claim. When the evidence is capable of an interpretation which makes it equally as consistent with the innocence of the accused party as with his guilt, the meaning must be ascribed to it which ac
There is another question in regard to the variance between the pleadings and the proof; the complaint alleging that the stock was bought from the defendants, whereas the evidence seems to show that it was. bought from the corporation. While, upon this appeal, such a variance may be of no particular moment, in view of the conclusion arrived at on the other points of the case, yet still it is a matter which may need some consideration before a retrial of this case is had. Upon the whole case we are of opinion that there was no evidence which justified the jury in finding that the defendants made these representations knowing them to be false, and the judgment and order appealed from should therefore be reversed, and a new trial ordered, with costs to the appellants to abide the event. All concur.