Shelton v. Healy

The principal complaint of the defendant in this appeal is that upon the trial in the Superior Court the plaintiff was permitted to offer evidence of fraudulent representations, made to induce the exchange in question, which were not alleged in the pleadings, and that such representations were found proven and were made the basis of the judgment rendered.

The representations, as alleged in the complaint, are in substance that the business of the Charter Oak Brick Company was very prosperous, yielding a profit of $100 per day, and paying large dividends, and that the stock of the company was worth par.

The representations proven were, in effect, that the business of the company was prosperous, the output six million brick a year, the profits $100 a day, and all the brick of the summer of 1897 sold; that its stock was fully paid in in cash; that defendant did not know what the stock was worth, but would not sell his for $150, and that a good income would come from it.

Although the plaintiff was precluded from proving, as a ground of recovery, any representation differing substantially from those alleged, he was neither required to allege the representations upon which he relied, in precisely the language in which they were made, nor to prove them precisely as alleged. It is enough to allege and prove the substance and material parts of the representations sufficient to sustain such an action. Representations differing from but tending to prove those alleged, may be shown, and to enable the court or jury to understand the meaning of the statements made by the defendant, and relied upon as proving the alleged representations, the plaintiff may often properly be permitted to prove the entire conversation in which statements occur, even though representations materially different from those alleged are thereby shown. Pedrick v. Porter, 5 Allen, 324, 326; Hick v. Thomas, 90 Cal. 289, 295.

Two of the representations alleged in the complaint, namely, that the business of the company was prosperous, and that it yielded a profit of $100 a day, appear by the finding to have been made in practically the words in which they are alleged. Proof of the other representations in the finding: that the output of the business was six million brick a year; that all the brick of the summer of 1897 had been sold; that a good income would come from the stock; that it had been fully paid for in cash; and that defendant would not sell his for $150; with proof that the defendant knew at the time that the company was practically doing no business and was in failing circumstances, and its stock of little or no value, — was admissible to prove, and we think was sufficient to prove, the fraudulent representations alleged in the complaint, that the business was very prosperous, and earning a profit of $100 a day; that large dividends would be earned and would be paid, and that the stock of the company was worth par.

The representation of the defendant as to the value of the stock is not, in this case, as claimed by the defendant, to be regarded as a mere expression of opinion, but as a statement of fact which may be the ground for an action of deceit. As a stockholder and director of the company from the time of its organization, and as its president and manager, the defendant possessed a special knowledge of the value of its stock, of which the plaintiff was ignorant; and the facts show, sufficiently, that the defendant knew that the plaintiff relied upon this statement as to the value of the stock.Gustafson v. Rustemeyer, 70 Conn. 125, 133; Lovejoy v. Isbell, 73 id. 368, 375.

To show the defendant's knowledge of the real value of the stock of the company, and of its affairs, the court properly admitted the testimony of McQuaid as to the manner in which the stock was paid for and the company was organized.

The testimony of the plaintiff of representations of the defendant as to the amount of the stock issued, that there was none upon the market, and that plaintiff would have to pay no assessment upon it, was admissible as tending to prove the alleged representation as to the value of such stock.

From the character of Exhibit C, as described in the record, we find no error in admitting it in evidence. If, as claimed by the plaintiff, it contradicted the representations made to the plaintiff as to the character of the business, it was not rendered inadmissible, as proof that those representations were fraudulent, because it described the condition of the company at a date earlier than that on which the representations were made, or because the plaintiff had not seen it.

Other rulings of the trial court upon matters of evidence are so manifestly correct as to call for no discussion.

There is no error.

In this opinion the other judges concurred.