*1 v. TREGER. STEIN al.
No. Appeals Court States
United Circuit. District Columbia 10, 1949. Nov.
Submitted May 3, 1950.
Decided 15,1950. June Denied
Mr. R. Lichtenberg, Washing- William ton, Barker, C.,D. with whom Mr. Samuel C., brief, was on the appellants. Luria, Washing- Joseph ton, C., appearance D. entered appellants. Laskey, Washington, L. John appellee. McALLISTER, by desig-
Before sitting nation, CLARK, MIL- WILBUR K. LER, Judges. Circuit McAllister, judge. circuit Appellee, Ely ac- brought an J. against appellant partners for dam- misrepresen- ages sustained from claimed whiskey. He re- tations the sale jury, appeal ceived verdict from a Ap- from the thereon. entered claim that the verdict was evidence, weight and that the failing trial court erred in jury that should made his *2 testified, to Treger was not he went and her facts investigation of the alleged represen- the office of and told them that upon entitled to delays on account and of tations. shipment receiving first which had been June, during that disclosed evidence late, two months he didn’t feel scarcity, was 1946, when, because obliged he should to on with whiskey at wholesale purchase to difficult contract, balance of and asked for appellants, who amounts, in substantial deposit return his because of the breach Treger, a whiskey brokers, called were however, agreement. Appellants, of the dealer in liquor according to him the told author- him that and informed being shipped was bottled Bal- and out of firm, a wholesale orders for ized to take timore, and being deliveries Distributing Com- North American daily, through and that if he not go did one Chicago. pany, in $5,000 with would lose the partners deposited. already had thereupon North whiskey from the he could gave $3,172.10 prepay a check for Distributing Company American shipment the second under the contract. any “tie-ins,” would meaning that he shipment This was never delivered. The anything have to else Chicago wholesaler became involved question; and that he could secure difficulties, bankruptcy pro- and whiskey, provided amount of the unlimited ceedings brought against were thereafter case, paid deposit a and a of $10.00 ever had signed “first come any statements that the upon further stated that served.” pany financially responsible, con- and availability of inquiry tradicted in much of his testi- whiskey, appellants him that informed “the mony as to representa- claimed just inwas tions. question of getting signed orders addition, ready ship.” would In The district court ruled that two he wanted know alleged representations were (1) material: appellants investigated had representation claimed by appel- Chicago company, inasmuch as this was lants to was avail- inquiry dealing, his usiral when he was able to the company to enable it them, through whole- comply with the contract at the time it time; for the first appellants saler signed; (2) representation “they investigated them, told him had appellants had Chi- * * * right, all cago company and had found that nothing worry I about and financially responsible. The court instruct- said never lost before in that if it represen- ed found these them, forget a deal with and to about that tations to been it would then part of it.” have to determine whether were false Relying the foregoing representa- and fraudulent made with intent tions, claimed, Treger as he thereafter, them, upon act cause and wheth- through appellant partners, ordered from he had them. Chicago company six hundred cases shipped him, Camel representation, appellants be- toAs the first ginning one hundred July, cases burden contend 1946, and one hundred cases each of prove the to was not avail- succeeding five He signed months. a con- able to enable it purchase $6,000, tract for such comply contract at time required deposit. signed; there was no He thereafter evidence ceived the first of one hundred whatever September, available; July,
cases in instead of error for the when was to been submit to sent to him. On Octo- district question just getting question whether shipments order and the false and fraudulent. This made. was a all On the *3 whiskey Treger the wanted was immedi- Chicago company at the was available ately But available. was evidence there signed with contract was the time the which reasonable inferences could Ney that he testified by whiskey Arno- Vombrack and a conference subject available. company, Chicago polin, officials City, to liens held in a bank Salt Lake in relations into business entering before pay which whiskey, and respect to the sale whiskey, could be released to them: “Before we stated that he company. thing snagged This was the questions few there are a into this hook, and, probability, in all caused you this ask. I asked: ‘Do own want to delay making of two months in whiskey?’ And Mr. Vombrack Treger. It was the liens time that Arnopolin me at assured brought pro- about bankruptcy whiskey me they and showed owned that ceedings, because of of distillation typewritten list of the dates pany’s inability whiskey whiskey grade of dates each delivery. leased for When investi- McKee that, Ney found out owned.” afterward gated the situation in in Decem- at the time ber, 1946, company still had hundreds hand, subject liens whiskey but whiskey, of barrels of it was but all sub- had the certificates “Mr. Vombrack —that ject lien, * and neither * Vombrack nor City bank Salt Lake at a in hock company officials of the could outright. There was own He didn’t secure its release. McKee Subsequent- against them.” loaned plan by under a party which third Ney that when Vombrack ly, learned to enter the capi- business and invest new posses- company, came into bought the tal, Chicago company proposed to the City, in Salt Lake sion of carry origi- retailers that it would out the owned; actual thought it but the which he whiskey purchase contracts, nal only and he ad- after was that he could secure fact McKee, Later, acting the liens. vised the retailers for whom he was secretary Liquor of the Retail executive they agreed plan, that if to such a the com- Association, Washington, Dealers pany, opinion, in his be able to com- arose, ap- who, ply clearly appears it. So it pointed by Treger and a number of other nondelivery reason their Washington dealers as and the other retailers was due attorney proceedings, fact initiate fact to the subject claims, accept payment, compromise company liens and the lacked cash to prosecute on their behalf actions them; pay and this accounts for the fail- Chicago company, testified that when company ure of the to fulfill its contracts. December, the matter 1946, Chicago, company had bar- circumstances, these Under subject to collateral lien. rels of jury could find that opinion We are of the that the trial made to that the was im properly available, submitted to the the mediately outlined, as above false. If the available, was made to to be known would be fraudu whether, by appellants; lent; if by and if made as fraudulent; false it was or as a their matter of fact, not known them to be representation, untrue, would be the material false fraudu heretofore mentioned, may honestly rep One make a false was in lent. resentation, ; believing all he that he wanted but if himself, investigation is false made but statement everyone almost else who has ever been and fraudulent. representations. defrauded fraudulent rely upon One does generally investigated the Chi they had representations, at his own risk. represented to him cago company and scrutiny From a rec the entire responsible. Wheth ord, clearly appears rep that whatever representation was such a by appellants resentations were made Moreover, honestly carry out its con was unable *4 part any knowledge without on their tracts; officials were known be that its But, they were untrue. as has been ob racketeers; deposits black market served, though representations, be even used, by purchasers or lieved be made as one’s own out, bulk found later if, false; are fraudulent offi that one of the around wrongful though innocent in record; lengthy criminal had a rather cials Treger, ap tent their transactions with whiskey; liens on the there were Ney are, jury’s outsider verdict, damage for answerable result cash so to advance ing princi dereliction of their evi this is the liens—all released from pal. inferences could be from which dence The of the District Court not “finan affirmed. right” at cially all the time appellants made Whether Affirmed. contract. wheth such On for Petition for cause came The above on to be heard appellant’s petition rehearing on court erred It is contended misrepresenta whether an issue innocent jury as refusing may operate tion of fact as a 'fraudulent investiga duty his own make Treger’s representation; is the sole issue. How of the wholesaler tion misrepresents party innocently Where a in though ever, mistake; material or makes obliga matter, no vestigated there was knowing it to be true peril, at upon him to do so unless false, even or believes it to put were such as to the circumstances true; grounds or without reasonable be purchaser, he was on notice. As a lieving to be true—such rely entitled support will an action for fraud. Anderson principal’s concerning their broker Cir., Tway, 95, 6 143 F.2d certiorari de v. especially standing, 861, 865, 324 nied U.S. 65 89 L.Ed. S.Ct. represen Chicago and gone to 1418; Sovereign Pocohontas Co. v. Bond tation al., 39; App.D.C. 175, 74 120 F.2d Grand matter; Co., R. v. Western Co. H. W. Nelson Trunk the broker’s entitled assurance 823; Cir., 116 6 F.2d Schwinn v. United was all in Cir., 74, States, 9 F. 2d 112 affirmed 311 U.S. anyone who available 390; 85 S.Ct. L.Ed. Panther 61 required pay make the order and sign Commissioner, Cir., Mfg. v. Rubber Co. 1 Treger could not ment. be said to be 314; Company Nocatee Fruit v. F.2d voluntary guilty seeing blindness in not Cir., 12 F.2d Fosgate, him, for matters before these matters were could, course, He petition him. is denied. rehearing