Hoitt v. Holcomb

23 N.H. 535 | Superior Court of New Hampshire | 1851

Bell, J.

The second replication follows the form given in 2 Ch. Pl., 603, (Day’s Ed.,) and 3 Ch. Pl., 563, (Phil. Ed.,) otherwise cited as 3 Ch. Pl., 1158 and 1238, which are referred to, 2 Saund. Pl. & Ev., 758, and given in Arch. N. P., 318, and see 2 Ch. Pl., 464.

In 1 Ch. Pl., 553, the law is stated tobe, that “to a plea of release, he (the plaintiff) may reply, that it was obtained by duress or fraud.” Went. Ind., 12, and it is in general unnecessary to state the particulars of the fraud. TresharrHs case, 9 Co., 110.

Tresham’s case was an action against an administratrix, in which she pleaded certain outstanding bonds of the deceased, and no assets further : Replication, as to certain of these, that deceased paid them in his lifetime, and that thej per fraudem et covinam of the administratrix, and to the intent to defraud the plaintiffs of their debt, were kept undischarged and uncancelled. It was resolved that the general allegation of fraud in the case at bar, was sufficient, as it was resolved in Tailbois ease, that general averment of covin was good, because covin is so secret, whereof by intendment another man can’t have knowledge. And if the special matter of covin, which, as it is there held, ex vi termini ought to be betwixt two by intendment of law, a stranger can’t have knowledge, a fortiori in the case of fraud, which may be in the heart of one only, for if- one by deed makes a fraudulent gift of his goods to divers, who know not of it, it is a fraud only in him who makes it.

The case of Wimbish v. Tailbois, Plow. Com., 38, is to the point, that an averment that a recovery in a real action was by covin between the parties, is good; and the question, whether the covin should not be specially averred, was argued at great length both by the counsel and the court, and it was' held, that the covin was well averred without special cause shown.

The case in the Yearbook, 33 Hen. VI., 5, abridged Bro. Ab. Trespass, 26, was trespass de bonis asportatis. The defendant pleaded a purchase in market overt. The plaintiff’s reply was, that the seller by covin between him and the defendant sold them in said market overt, and it was held that no property passed, and no question made as-to the sufficiency of the replication.

The case of Knight v. Peachy, T. Ray., 303; Vent., 329, 331; S. C. Anon.; 2 T. Jon., 199, was thus: In debt for rent against an assignee of lessee, the defendant pleaded an assignment by him to J. S., such a day, and notice to the plaintiff before any rent accrued. The plaintiff, lessor, replied, that the assignment was to defraud him of his action by fraud and covin-. The defendant demurred, and it was urged, that fraud is not to be averred in this case, for the assignment was a lawful act; but it was answered, that fraud and covin made legal acts illegal and void. Judgment for the plaintiff, Scroggs, C. J. diss.

In Daniels v. Coombe, 2 Scott N. R., 597, in an action against a third indorser by a remote endorsee of a bill of exchange, defendant the pleaded, that he was induced to indorse the bill by the fraud, covin and misrepresentation of the plaintiff and two others of the indorsers, and other persons in collusion with them, and without value or consideration. The replication traversed the alleged fraud, covin and misrepresentation. To this there was a special demurrer, and the replication held good. It seems no question was made of the sufficiency of the plea.

In Sherwood v. Jonson, 1 Wend., 443, it was held, that in a replication to a plea by an executor, of an outstanding judgment and no assets further, that the judgment was fraudulently obtained, it is sufficient' to allege fraud and covin generally, without showing the fraud specially. This is the same point raised and so decided in Tresham’s case.

In Pierce v. Smock, 2 Blackf., 316, a general plea to an action on a bond, that the bond was obtained by fraud and covin, without setting out the particulars of the fraud, was held good.

In Mason v. Evans, Coxe, 182, it was held, that a plea, that a bond was obtained by fraud generally, is a good plea.

In Pemberton v. Staples, 6 Miss., 59, it was held, fraud is á good defence at law, and it is sufficient to allege fraud generally in a plea.

In Stower v. Wier, 10 S. & R., 25, in debt on a single bill, the defendant pleaded, that the instrument was obtained from him by fraud. The plaintiff replied that it was the defendant’s deed. It was held after verdict for the plaintiffs, that the plea was in the nature of a special non est factum, and the issue well joined, and the judgment regular.

In Potter v. Wibb, 2 Greenl. Rep., 257, in a sciréfacids for further execution on a judgment on a probate bond, a plea by the sureties, that the decree was obtained by fraud and collusion, without naming the parties to the fraud, was held bad.

Pleas in this general form are found in Crail v. D’Acth, 7 D. & E., 670, (b.); Hamfray v. Rigby, 5 M. & S. 60.; Green v. Gadsden, 4 Scott, N. R., 13; 5 Jur., 1010 ; Cornfoote v. Fowke, 6 M. & W., 358 ; 4 Jur., 918 ; Webb v. Steele, 13 N. H. Rep., 230 ; and Hewett v. Bronaugh, 3 Dana, 459; in which no exception was taken on account of this general form.

This form of pleading seems to us well sustained by the decisions of ancient and modern times, by the books of precedents, and usage of the profession, as well as by the reason of the case. The defence of fraud may be shown in assumpsit under the general issue. Lawes Pl., in Asst., 586; 3 Ph. Ev., 88; Ch. Con., 295 ; 2 Kent Com., 482; or if the document is put in evidence under the general issue, fraud in it may be shown by parol evidence.

So fraud in any sealed instrument may be shown under the plea of non est factum. Anon. Lofft., 457 ; 1 Tidd’s Pr., 595 ; Whelpdales case, 5 Co., 119; 2 Wils., 341; Vine v. Mitchell, 1 M. & R., 337; 2 Greenl. Ev., § 246; Van Valkenburg v. Rouk, 12 Johns., 337 ; Candy v. Twitchell, 2 Root, 123; Ragsdale v. Thorn, 1 McMull., 335. There would seem to be a very useless refinement, to require that the precise facts, by which the fraud was effected, should be stated in a special plea, when they are equally available under the general issue. Especially as it is never necessary to plead fraud, which is but a special non est factum. Bickford v. Daniels, 2 N. H. Rep., 74; 10 S. & R., 25; Union Bank v. Ridgeley, 1 H. & G., 324.

The third and fourth replications follow the form in 2 Ch. Pl., 464, (Day’s Ed.,) a plea that a deed was obtained by fraud, also given in Hurlstone on Bonds, 191.

The particular facts to beset out in the plea, as the matters by which the fraud was accomplished, must of course vary in each particular case; and in deciding upon the sufficiency of the statement of them, we have to consider, what is the nature of the misrepresentations, which are required to support the charge of fraud. Such misrepresentations are usually, either the allegatio falsi, or the suppressio veri. The first of these, the misstatement of facts, must be a statement of what is false, and known to be such, or not known to be true to the fraudulent party; in a point material to the contract to be made ; in relation to a matter not equally within the knowledge of the party imposed upon; which he did in fact rely upon; and by which he is actually misled and deceived to his injury. The second, the suppression of fact, must be of a matter material to the contract; known to the fraudulent party and not known to the other, nor equally open to be known ; which was either kept out of sight by artifice, or was such as the injured party had a right to expect the other to state; and by the ignorance of which, he was deceived and imposed upon. 1 Story Eq. Jur., § 200, &c.; 1 Mad. Ch., 262, &c.

Upon comparing the first of these with the allegations of the third and fourth replications, we think these pleadings contain all that is necessary to be alleged. The misstatements are clearly stated, and them materiality is apparent upon the pleadings. The knowledge in regard to these facts cannot be reasonably supposed to have been in possession of the plaintiff, especially when it is stated, that he confided in the statements made to him, and it is sufficiently alleged that the defendant was imposed upon and deceived. The answer given by the plaintiff’s counsel to the objection, that it is not alleged that the releasee knew of the falsehood of his statements is entirely satisfactory. It is alleged that those statements were fraudulently made, and that is a sufficient allegation that they were known to be untrue. These replications then being in good form and entirely sufficient, the demurrer must be overruled.

"We have examined the decisions in the State of New-York, to which our attention has been called by the counsel for the defendant; and we are aware of like decisions in Yirginia and North Carolina, in Ohio, Indiana and Illinois, in Missouri and Arkansas, which are supposed to establish the points, that in an action upon a bond or other specialty, fraud is no defence, if it relate to the consideration of the instrument, and that it must be fraud in relation to the execution alone, that constitutes a defence ; and as a cor|llary to this, that a general plea of fraud and covin is bad, because it does not set forth that the fraud was in relation to the delivery or execution of the instrument. We have found no word in any book relating to the common law, which. gives the least countenance to the distinction set up in these cases, until the case of Vrooman v. Phelps, 2 Johns., 177, decided in 1807. No book, or case of earlier date than this, is cited in support of it, in any case we have seen. The case of Vrooman v. Phelps, was decided entirely upon the authority of Dollan v. Sammis, cited and first published in a note appended to the case. The point of the last case was merely whether the failure of consideration was a defence to a bond, and it was decided there that it was not a defence. But the doctrine of the court in that case was the true one. The court say, “ There is no allegation that the plaintiff sold the chattel fraudulently, and knowing he had no title. There is no case in which a bond can be set aside, but when the consideration was void in law, or there was fraud.” This implies, as strongly as language can imply anything, that a bond would be set aside for fraud, generally for any fraud.

In Vrooman v. Phelps, the plea was fraudulent representations as to the character of the slaves for the price of which the bond was given, — and general demurrer. The judge, who delivered the opinion of the court, says, “ In Dollan v. Sammis, it was held, that the want or failure of consideration could not be set up at law to impeach a specialty. The principle applies to this case. It has been repeatedly decided, that the breach of a written warranty, as to the quality of goods sold, cannot be pleaded in discharge of a bond given for the consideration; much less ought parol representations, as to the quality of a thing, made antecedent to the contract, though false and fraudulent, and though they may have induced the defendant to make the purchase, be pleaded in avoidance of a specialty. The special plea forms no valid defence to this suit.” The plea of fraud was in good form, setting forth the particulars. The decision was in effect, as it was expressed by the judge in the case of Dorr v. Munsell, 13 Johns., 430, that “ a fraudulent representation of the plaintiff’s rights.” (i. e., of material facts,) “ is in substance a denial of any consideration for the bond !” It was based upon a confounding of fraud with want of consideration, two things radically and essentially distinct, and standing upon principles entirely unlike. The principle of the common law is well settled, that fraud vitiates everything, contracts, obligations, deeds of conveyance, and even the records and judgments of courts, incontrovertible as they are on every other ground ; while want or failure of consideration alone is no defence to any specialty. This distinction was clearly recognized in Dollan v. Sammis, the case cited by the judge. In the case of Bunn v. Lee, 4 Johns., 410, two years after, in 1809, the court held in a like case of debt on bond, and fraud pleaded, that the consideration for the promise was illegal and founded in fraud, being made for the purpose of preventing due scrutiny into the claim of the defendant to a discharge as an insolvent debtor, — and the court say, “ The present action being founded on a specialty does not vary the case ; the seal does not preclude an inquiry into the consideration, if illegal and fraudulent.” The court thus clearly recognized the common law doctrine, that fraud is a good defence to a bond. Yet upon this basis of Vrooman v. Phelps, there was built up in New York a series of decisions, establishing a new and mischievous principle, that a seal was sufficient to preclude, in a court of law, all inquiry relative to fraud in the consideration of a sealed instrument. The innovation was evidently resisted by the bar, since no less than seven decisions upon the point are reported in that State in a little over twenty years. And the common law was restored by act of the legislature in the revised statutes of that State. See Case v. Boughton, 11 Wend., 106. Similar decisions made in Ohio and Indiana have led to the like restoration of the common law. See Huston v. Williams, 3 Blackf., 171; Greathouse v. Dunlap, 3 McLean, 303.

These decisions do not appear by the Digests to have been followed in any of the New-England States, nor in Pennsylvania, Maryland, or South Carolina. And we entertain no doubt, that this heresy will be rejected in every State, in which it has been recognized, whenever the subject shall be thoroughly examined.