delivered the opinion of the Court.
In this аction we consider whether there still exists in Maryland a tort suit for negligent misrepresentation independent of one for deceit. The case arose when appellant Martens Chevrolet, Inc. 1 instituted in the Circuit Court for Montgomery County this action against the appellees, Loving Chevrolet, Inc. and its sole stockholders, Franklin Loving and Howard F. Seney, alleging in separate counts breach of contract, decеit and negligent misrepresentation arising from the sale of an automobile dealership. On the apparent belief that no such action exists in Maryland, the trial judge granted at the close of appellant’s case the defendants’ motion for a directed verdict on the negligent misrepresentation count; a directed verdict was also granted in favor of the defendants on the breach of contract сlaim. 2 *331 The remaining count, sounding in deceit, was, however, submitted to the jury for its consideration, but that body returned a verdict in favor of Loving, Seney and their company. After the appellant noted its appeal to the Court of Special Appeals, we granted certiorari on our own motion, prior to consideration of the matter by that court, primarily to clarify seeming confusion in the law of this State concerning the existence of an action for negligent misrepresentation. 3
For reasons which we will explore presently, we conclude that the tort of negligent misrepresentation is viable in Maryland. Consequently, as the issue presented here arose in the context of a motion for directed verdict, the evidentiary background will be stated in a light most favorable to the plaintiff-appellant.
Impala Platinum v. Impala Sales,
After the franchise operated as Martens Chevrolet, Inc. for six months, the accountant for the new company presented its owners with a statement revealing a $187,000 loss. The Martens were baffled as to the reason for the dealership’s financial plunge until its comptroller, who had formerly worked in that capacity for the seller, divulged a 1975 year-end financial stаtement which he had prepared for Loving Chevrolet listing a deficit for that year of $39,153.00, instead of a $2,211 profit as reflected in the 1975 trend sheet. In addition, the comptroller gave the new owners a financial statement completed by a certified accountant, following an audit, which stated that the losses sustained by the former dealership in that year were not $39,153, but, rather, $69,000. Both of these documents had been prepared well before the date of sale, but the sellers had neglected to inform the buyers of their existence. On the basis of this newly received information, the Martens brought the present action against Loving, Seney and their company.
*333 (i)
With the relevant factual predicate in hand, we turn now to address the question of whether there is presently cognizable in Maryland a tort action for negligent misrepresentation. We begin our inquiry by noting that initially under the common law there existed no separate tort of negligent misrepresentation. Thus, if a party was injured by the false representations of another, his only recourse in tort, if there was one, compelled the bringing of an action for deceit and proving all the elements of that tort.
Buschman v. Codd,
To entitle the plaintiff to recover it must be shown: (1) that the representation made is false; (2) that its falsity was either known to the speaker, or the misrepresentation was made with such a reckless indifference to truth as to be equivalent to actual knowledge; (3) that it was made for the purpose of defrauding the person claiming to be injured thereby; (4) that such person nоt only relied upon the misrepresentation, but had a right to rely upon it in the full belief of its truth, and that he would not have done the thing from which the injury resulted had not such misrepresentation been made; and (5) that he actually suffered damage directly resulting from such fraudulent misrepresentation.
The critical element of the tort of deceit that distinguishes it from others arising from false representation is scienter on the part of the defеndant — intent to deceive the other party. In formulating the contours of this state of mind requirement, our predecessors in
Cahill v. Applegarth,
First, in order to sustain an action of deceit, there must be proof of fraud, and nothing short of that will suffice. Secondly, fraud is proved when it is shown that a false representation has been made (1) knowingly, or (2) without belief in its truth, or (3) recklessly, careless whether it be true оr false. Although I have treated the second and third as distinct cases, I think that the third is but an instance of the second, for one who makes a statement under such circumstances can have no real belief in the truth of what he states. To prevent a false statement being fraudulent, there must, I think always be honest belief in its truth.[ 4 ]
The teachings of
Cahill
were reemphasized one year later in
Donnelly v. Baltimore Trust & Guarantee Co.,
Realizing the inequities stemming from the strictures imposed for recovery in a deceit action, and being cognizant of the development of this area of the law in our sister jurisdictions, this Court in 1938 recognized for the first time the existence in this State of an action for negligent misrepresentation.
Virginia Dare Stores v. Schuman,
175
*335
Md. 287,
No Maryland case has been found directly upon the subject, but the weight of authority in other jurisdictions seems to be that such action is not necessarily confined to injuries arising from contractual relations; that the action lies for negligent words, recovery being permitted where one relies on statements of another, negligently volunteering an erroneous opinion, intending that it be acted upon, and knowing that loss or injury are likely to follow if it is acted upon. [Id. at 291-92,1 A.2d at 899 .]
*336
Subsequent cases referred to the
Virginia Dare
opinion as one recognizing a recovery for negligent statements if personal injury results,
Holt v. Kolker, supra,
The only one of our many decisions in this area which in any way impinges upon this just announced reaffirmation is
Delmarva Drill Co. v. Tuckahoe,
We summarize and clarify. The principal elements of the tort of negligent misrepresentation, as formulated in *337 Virginia Dare, supra, and subsequent cases decided by this Court, may be outlined as follows:
(1) the defendant, owing a duty of care to the plaintiff, negligently asserts a false statement;
(2) the defendant intends that his statement will be acted upon by the plaintiff;
(3) the defendant has knowledge that the plaintiff will probably rely on the statement, which, if erroneous, will cause loss or injury;
(4) the plaintiff, justifiably, takes action in reliance on the statement; and
(5) the plaintiff suffers damage proximately caused by the defendant’s negligence.
In this regard, see
Virginia Dare Stores v. Schuman, supra; Holt v. Kolker, supra; Piper v. Jenkins, supra; Brack v. Evans, supra; St. Paul at Chase v. Mfrs. Life Insur.,
In the present case, the appellants, by their amended declaration, alleged in separate counts both negligent misrepresentation and deceit. Nothing prohibits a plaintiff from pleading both deceit and negligent misrepresentation in one declaration and then relying on the same nucleus of facts in an аttempt to satisfy the differing burdens of proof on these alternative claims. See Md. Rule 313;
Peurifoy v. Congressional Motors,
(ii)
We turn now to address the two evidentiary questiоns presented by this appeal, either of which, contends appellant, requires a new trial of the deceit claim. The first concerns the cross-examination during trial of one of the appellant’s witnesses (not a party), Harry J. Martens, Jr., by the attorney for appellee Loving. The colloquy which gave rise to this issue occurred as follows:
Defense Counsel: Mr. Martens, I want to ask you something else about another subject. A suit such as this is distasteful when you are charging somebody with deceit, you know that?
Mr. Martens: Yes.
*339 Defense Counsel: You have been charged with deceit by the Chrysler Company, haven’t you?
Plaintiffs Counsel: Objection.
A bench conference ensued during which the trial judge overruled the appellant’s objection and allowed the question. The colloquy then continued.
Defense Counsel: I want to rephrase that question to get the proper words in. You have beеn charged in this lawsuit 52800 filed in this court by the Chrysler Corporation with fraud and conspiracy to defraud, haven’t you?
Mr. Martens: Yes, sir.
Defense counsel’s obvious purpose was to impeach the credibility of Martens’ testimony concerning the alleged deceit of the appellees in the sale of the automobile dealership by revealing to the jury the fact that Martens, himself, had been formally charged with fraud in an unrelated civil court сase by another party.
It is hornbook law that when a person testifies as a witness, generally he may be cross-examined on such matters and facts as are "likely to affect his credibility, test his memory or knowledge, show his relation to the parties or the cause, his bias, or the like,”
Kantor v.
Ash,
The final matter presented in this case concerns the trial *341 judge’s decision to admit portions of a deposition into evidence at the trial. Although the court had ordered that all discovery in the case be concluded no later than October 21, 1980, appellees, in disregard of this order, and with only 24 hours notice to opposing counsel, deposed a General Motors’ employee in Warren, Michigan two weeks after the discovery deadline had passed. In this regard, Maryland Rule 400 (a) provides:
Notwithstanding any other provision of this Chapter, the court may at any time order that discovery in an action be completed by a specific date or time, which shall be a reasonable time after the case is at issue. The court may, for good cause shown, enlarge or shorten the time specified in its оrder.
Since no modification of the discovery terminating order was sought by the appellees here, it is manifest that the deposition in question was taken in violation of the Maryland Rules. However, as we have already concluded on other grounds that a new trial is required on the deceit and negligent misrepresentation claims, we pursue the matter no further. Parenthetically, we note that should the new proceеdings which we award take place, and the appellee desire again to introduce this witness’ testimony in deposition form, it would be prudent to redepose him — this time in accord with the appropriate Maryland Rules.
Judgment of the Circuit Court for Montgomery County reversed and case remanded to that Court for a new trial.
Costs to be paid by the appellees.
Notes
. In addition, Imperial Investment Company and Harry J. Marten, III, joined Martens Chevrolet, Inc. as plaintiffs. In the intеrest of simplicity we shall refer to these plaintiffs-appellants in the singular and as Martens Chevrolet, Inc.
. No appeal was taken from the contract count ruling, and consequently we do not consider the propriety of it here.
. In addition, because we address this case on direct appeal, we are required to consider two evidentiary issues raised by appellant.
. Other states have adoptеd this concept with respect to scienter in deceit actions.
See, e.g.,
Sledge & Norfleet Co. v. Mann,
. In reaching its decision in
Virginia Dare,
this Court was to a large extent influenced by two cases from other jurisdictions, International Products Co. v. Erie R. Co.,
. In
Brack,
a stockbroker negligently gave erroneous advice concerning the purchase of stock to one of his clients who suffered a financial loss when he relied on the information. Although the evidencе failed to establish the scienter necessary to support an action for deceit, we held that it would authorize recovery in negligence. This position was later reaffirmed in St. Paul at Chase v. Mfrs. Life Insur.,
. Appellees have also argued that even if negligent misrepresentation is a viable tort action in this State, it can never be applied to statements made in connection with consummation of an arm’s length transaction, as was involved in the present case. We find nothing in Virginia Dare or its progeny to support such a sweeping assertion and we reject it. In addition, appellees make oblique reference to a general integration clause in the contract of sale of the dealership which states that it "supercedes all prior and contemporaneous agreements and understandings, inducements or conditions, express or implied, oral or written....” While not directly so stating, appellees imply that this clause shields them from liability for any breach of duty that otherwise may have been imposed. In this regard, we agree with the position taken by the New York Court of Appeals in Jackson v. State:
A party to a contract cannot, by misrepresentation of a material fact, induce the other party to the contract to еnter into it to his damage, and then protect himself from the legal effect of such misrepresentation by inserting in the contract a clause to the effect that he is not to be held liable for the misrepresentation which induced the other party to enter into the contract. The effect of misrepresentation and fraud cannot be thus easily avoided. If it could be, the implied covenant of good faith and fаir dealing existing in every contract would cease to exist. [241 N.Y. 563 ,150 N.E. 556 (1925) (adopting the opinion of Hubbs, J., in Jackson v. State,210 App. Div. 115 ,205 N.Y.S. 658 , 661 (1924)); compare Danann Realty Corp. v. Harris,5 N.Y.2d 317 ,157 N.E.2d 597 (1959).]
. Section 10-905 (a) reads:
(a) In general — Evidence is admissible to prove the interest of a witness in any proceeding, or the fact of his conviction of an infamous crime. Evidence of conviction is not admissible if an appeal is pending, or the time for an appeal has not expired, or the conviction has been reversed, and there has been no retrial or reconviction.
This evidentiary principle has been applied in civil cases. Nelson v. Seiler,