FRAUD. The unlawful appropriation of another's property, with knowledge, by de sign, and without criminal intent.
Fraud is sometimes used as a term synonymous with COVill collusion, and deceit, hut improperly so. Coat& is a secret contrivance between two or more persons to defraud and prejudice another of his rights. Collusion is an agreement between two or more persons to defraud another under the forms of law, or to accomplish an illegal purpose. Deceit is a fraudulent contrivance by worth or acts to de ceive a third person, who, relying thereupon, with out carelessness or neglect of his own, sustains damage thereby. Coke, Litt. 357 b; Bacon, Abr.
2. Actual or positive fraud includes cases of the intentional and successful employ ment of any cunning, deception, or artifice, -used to circumvent, cheat, or deceive another. 1 Story, Eq. Jur. 186.
For instance, the misrepresentation by word or deed of material facts, by which one exercising rea sonable disoretion and confidence is misled to his in iury, whether the misrepresentation was known to he false, or only not known to be true, or even if made altogether innocently ; the suppression of material facts which one party is legally or ecini. tably bound to disclose to another; all cases of un. conscientious advantage in bargains obtained by imposition, circumvention, surprise, and undue in finance over persons in general, and especially over those who are, by reason of age, infirmity, idiocy, lunacy, drunkennesa, ceverture, or other incapa city, unable to take due care of and protect their own rights and interests; bargaina of such an un conscionable nature and of such inequality as naturally lead to the presumption of fraud, im position, or 'undue influence, when the decree of the court oan place the parties in stain quo; cases of surpriae and endden action, without due delibe ration, of whioh one party takes advantage; cases of the fraudulent suppression or destruction of deeds and other instruments, in violation of, or injury to, the rights of others; fraudulent awards with intent to do injustice; fraudulent and illusory appointments and revocations under powers ; frau• dulent prevention of acts to be done for the benefit of others under false statements or false promises ;. frauds in relation to truste of a secret or special nature ; frauds in verdicts, judgments, decrees, and other judicial proceedings; frauda in the confusion of boundaries of estates and matters of partition and dower • frauds in the administration of chari ties; • and dower; upon creditors and other persons standing upon a like equity, are cases of actual fraud. 1 Story, Eq. Jur. c. 6.
3. Legal or constructive fraud includes such contracts or acts as, though not originating in any actual evil design or contrivance to perpetrate a fraud, yet by their tendency to. deceive or mislead others, or to violate private or public confidence, are prohibited by law.
Thus, for instance, contracts against some gene ral public policy or fixed artificial policy of the law ; cases arising from some peculiar confidential or fiduciary relation between the parties, where ad vantage is taken of that relation by the person in whom the trust or confidence is reposed, or by third peraona ; agreements and other acts of parties which operate virtually to delay, defraud, and deceive creditors; purchases of property, with full notice of the legal or equitable title of other persons to the same property (the purchaser becoming, by con struction, partieepe criminia with the fraudulent grantor); and voluntary conveyances of real estate, as affecting the title of subsequent purchasers. 1 Story, Eq. Jur. c. 7.
According to the civilians, positive fraud consists in doing one's self, or causing an other to do, such things as induce the opposite party into error, or retain him there. The intention to deceive, which is the characteris tic of fraud, is here present. Fraud is also divided into that which has induced the con tract, clolus dans cansum contractui, and inci dental or accidental fraud. The former is that which has been the cause or determining motive of the contract, that without which the party defrauded would not have con tracted, when the artifices practised by one of the parties have been such that it is evi dent that without them the other would not , have contracted. Incidental or accidental ' fraud is that by which a person, otherwise determined to contract, is deceived on some accessories or. incidents of the contract,—for example, as to the quality of the object of the contract, or its price, —so that he has made a bad bargain. Accidental fraud does not, ac cording to the civilians, avoid the contract, but simply subjects the party to damages. It is otherwise where the fraud has been the determining cause of the contract, qui causam dedit contractui: in that case the contract is void. Toullier, Dr. Civ. Fr. liv. 3, t. 3, c. 2, n. 5, n. 86, et seq. See, also, 1 Malleville, Analyse de la Discussion du Code Civil, pp. 15, 16 ; Bouvier, Inst. Index.