judgment of the Court of Appeal (a), to be the correct one. "The ground upon which an alleged belief was founded" is allowed to be" a most important test of its reality" (b); but if it can be found as a fact that a belief was really and honestly held, whether on reasonable grounds or not, a statement embodying that belief cannot render its maker liable in an action for deceit (c).

I have given reasons elsewhere (d) for thinking this decision of the House of Lords an unfortunate one. It would be out of place to repeat those reasons here. But it may be pointed out that the reversed opinion of the Court of Appeal coincides with that which has for many years prevailed in the leading American Courts (e), and has lately been thus expressed in Massachusetts :

"It is well settled in this Commonwealth that the charge of fraudulent intent, in an action for deceit, may be maintained by proof of a statement made, as of the party's own knowledge, which is false, provided the thing stated is not merely a matter of opinion, estimate, or judgment, but is susceptible of actual knowledge; and in such case it is not necessary to make any further proof of an actual intent to deceive. The fraud consists in stating that the party knows the thing to exist, when he does not know it to exist; and if he does not know it to exist, he must ordinarily be deemed to know that he does not (ƒ).

Perhaps it would have been better on principle to hold the duty in these cases to be quasi ex contractu, and evade the barren controversy about "legal fraud." One who makes a statement as of fact to another, intending him to act thereon, might well be held to request him to act upon it; and it might also have been held to be an implied

(a) Peck v. Derry (1887), 37 Ch. Div. 541, 57 L. J. Ch. 347.

(b) Lord Herschell, 14 App. Ca. at p. 375.

(c) Acc. Glasier v. Rolls (1889), 42 Ch. Div. 436, 58 L. J. Ch. 820; Low v. Bouveric, '91, 3 Ch. 82, 60 L. J. Ch. 594, C. A.

(d) L. Q. R. v. 410; for a different view, see Sir William Anson, ib. vi. 72.

(e) Cooley on Torts, 501. The tendency appears as early as 1842, Stone v. Denny, 4 Met. (Mass.) 151, 158.

(f) Chatham Furnace Co. v. Moffatt (1888), 147 Mass. 403.

term or warranty in every such request that the party making it has some reasonable ground for believing what he affirms; not necessarily sufficient ground, but such as might then and there have seemed sufficient to a man of ordinary understanding. This would not have been more artificial than holding, as the Exchequer Chamber was once prepared to hold, that the highest bona fide bidder at an auction, advertised to be without reserve, can sue the auctioneer as on a contract that the sale is really without reserve, or that he has authority to sell without reserve (g).

And such a development would have been quite parallel to others which have taken place in the modern history of the law. No one now regards an express warranty on a sale otherwise than as a matter of contract; yet until the latter part of the eighteenth century the common practice was to declare on such warranties in tort (h). But it seems now too late, at all events in this country, to follow such a line of speculation.

It has been suggested that it would be highly inconvenient to admit inquiry into the reasonableness of a belief admitted to be honestly entertained" (i). I cannot see that the inquiry is more difficult or inconvenient than that which constantly takes place in questions of negligence, or that it is so difficult as those which are necessary in cases of malicious prosecution and abuse of privileged communications.

Representations subsequently discovered to be untrue. If, having honestly made a representation, a man discovers that it is not true before the other party has acted upon it, what is his position? It seems on principle that, as the

(g) Warlow v. Harrison (1859), 1 E. & E. 309, 29 L. J. Q. B. 14.

(h) Williamson v. Allison (1802), 2 East, 446, 451. We need not remind the learned reader that the action of assumpsit itself

was originally an action on the case for deceit in breaking a promise to the promisee's damage: J. B. Ames in Harvard Law Rev. ii. 1, 53

(i) Sir W. Anson, L. Q. R. vi. 74.

offer of a contract is deemed to continue till revocation or acceptance, here the representation must be taken to be continuously made until it is acted upon, so that from the moment the party making it discovers that it is false and, having the means of communicating the truth to the other party, omits to do so, he is in point of law making a false representation with knowledge of its untruth. And such has been declared to be the rule of the Court of Chancery for the purpose of setting aside a deed. "The case is not at all varied by the circumstance that the untrue representation, or any of the untrue representations, may in the first instance have been the result of innocent error. If, after the error has been discovered, the party who has innocently made the incorrect representation suffers the other party to continue in error and act on the belief that no mistake has been made; this from the time of the discovery becomes, in the contemplation of this Court, a fraudulent misrepresentation, even though it was not so originally" (j). We do not know of any authority against this being the true doctrine of common law as well as of equity, or as applicable to an action for deceit as to the setting aside of a contract or conveyance. Analogy seems in its favour (k). Since the Judicature Acts, however, it is sufficient for English purposes to accept the doctrine from equity. The same rule holds if the representation was true when first made, but ceases to be true by reason of some event within the knowledge of the party making it and not within the knowledge of the party to whom it is made (1).

(j) Reynell v. Sprye (1852), 1 D. M. G. 660, 709, Lord Cranworth: cp. Jessel M. R., Redgrave v. Hurd (1881), 20 Ch. Div. 12, 13, 51 L. J. Ch. 113.

(k) Compare the doctrine of continuous taking in trespass de bonis asportatis, which is carried out to the graver consequences in the criminal law. Jessel M. R. assumed the common law rule to be in some way narrower than that of

equity (20 Ch. Div. 13), but this was an extra-judicial dictum; and see per Bowen L. J., 34 Ch. Div. at p. 594, declining to accept it.

(1) Traill v. Baring (1864), 4 D. J. S. 318; the difficulty of making out how there was any representation of fact in that case as distinguished from promise or condition of a contract is not material to the present purpose.

Assertions made in reckless ignorance. On the other hand if a man states as fact what he does not believe to be fact, he speaks at his peril; and this whether he knows the contrary to be true or has no knowledge of the matter at all, for the pretence of having certain information which he has not is itself a deceit. "He takes upon himself to warrant his own belief of the truth of that which he so asserts" (m). "If persons take upon themselves to make assertions as to which they are ignorant whether they are true or untrue, they must, in a civil point of view, be held as responsible as if they had asserted that which they knew to be untrue" (n). These dicta, one of an eminent common law judge, the other of an eminent chancellor, are

(m) Maule J., Evans v. Edmonds (1853), 13 C. B. 777, 786, 22 L. J. C. P. 211.

(n) Lord Cairns, Reese River Silver Mining Co. v. Smith (1869), L. R. 4 H. L. 64, 79, 39 L. J. Ch. 849. See per Sir J.

Hannen in Peek v. Derry, 37 Ch. Div. at
p. 581.
Even Lord Bramwell allows
Lord Cairns' dictum (14 App. Ca. at p.
351).

Assertions made in reckless ignorance. Agreeing with the text it was held by the court in McBeth v. Craddock (28 Mo. App. 392), that the gist of the action is the fraudulent representations of the defendant to plaintiff's damage. There must be fraud as distinguished from mere mistake. "It is not, however, always absolutely necessary that an actual falsehood should be uttered to render a party liable in an action of deceit. If he states material facts as of his knowledge, and not as a mere opinion or general assertion, about a matter of which he has no knowledge whatever, this distinct, wilful statement, in ignorance of the truth, is the same as the statement of a known falsehood, and will constitute a scienter. * * All the authorities are agreed, that deceit may be committed not only with the careful intention of one who knows what he asserts to be true or false, but also with the reckless intention of one who does not know what he represents to be true or false, but who, for one reason or another is willing that his reckless representations should be believed." Stimson v. Helps, 9 Colo. 33; 10 Pac. Rep. 291; Dunn v. Oldham, 63 Mo. 181; Caldwell v. Henry, 76 Id. 254; Dulaney v. Rogers, 64 Id. 204; Cummings v. Cass, 53 N. J. L. 77; 18 At. Rep. 972; Nauman v. Oberle, 90 Mo. 669; Kenny v. Railroad, 80 Id. 572; Koontz v. Kaufmann, 31 Mo. App. 418; Lahay v. City Nat. Bank, 15 Colo. 339; 25 Pac. Rep. 204; Busterud v. Farrington, 36 Minn. 320; 31 N. W. Rep. 360, citing numerous cases; Miner v. Medbury, 6 Wis. 295; Smith v. Richards, 13 Pet. 26; The Montreal River Lumber Co. v. Mihills, 80 Wis. 540; 50 N. W. Rep. 507.