Mere honest expression of opinion will not, as a rule, be regarded as fraud, either as a basis for an action of deceit, or as ground for setting aside a contract, although the opinion may prove to be erroneous ; Wise v. Fuller, 29 N. J. Eq. 257; Putman v. Brom well, 73 Tex. 465, 11 S. W. 491; Max Mead ows Land & ImproveMent Co. v. Brady, 92 Va. 71, 22 S. E. 845 ; Southern Development Co. v. Silva, 125 U. S. 247, 8 Sup. Ct. 881, 31 L. Ed. 678 ; L. R. 13 Q. B. D. 562. And this rule applies ordinarily to statements of the value of property to be bought or sold; Chrysler v. Canaday, 90 N. Y. 272, 43 Am. Rep. 166 ; Anderson v. McPike, 86 Mo. 293 ; Lion v. McClory, 106 Cal. 623, 40 Pac. 12; but it cannot be laid down as a matter of law that value is never a material fact ; Picard v. McCormick, 11 Mich. 68 ; as where the defendant was employed to value real estate for an intended mortgagee, and gave a valuation which was in fact no valuation at all, it was held that the defendant owed a duty to the plaintiff which he had failed to discharge, and had made reckless statements on which plaintiff had acted, and therefore defendant was liable to plaintiff for the loss he had sustained; 39 Ch. D. 39.
So the mere puffing of articles to be sold is held not to amount to such a misrepre sentation as will amount to fraud ; Allen v. Hart, 72 Ill. 104; but this rule applies only when the purchaser has a full and fair op portunity to inspect the article and judge for himself, and not to things which are not the subject of any visible test or examination; Gaty v. Holcomb, 44 Ark. 216 ; and a, vendor may be held guilty of deceit by reason of ma terial untrue representations in respect to his own business or property, the truth of which representation he is hound and must be pre sumed to know ; Lehigh Zinc & Iron Co. v. Bamford, 150 U. S. 673, 14 Sup. Ct. 219, 37 L. Ed. 115. A person who makes representa tions of material facts, assuming or intend ing to convey the impression • that he has adequate knowledge of the existence of such facts, when he is conscious that he has no such knowledge, is liable if he knew that they were false ; id.
Statements as to future events are mere matters of opinion; Davidson v. Hobson, 59 Mo. App. 130; and however contrary to good faith and sound morals, • they cannot form the basis of an action at law or in equity; Dugan v. Cureton, 1 Ark. 31, 31 Am. Dec.
727 ; but see Harvey v. Hadley, 87 Cal. 557, 26 Pac. 792, where although the question was not raised as to whether misrepresentations of prospects of property sold would entitle one to an action, yet as the measure of dam ages for such representations was decided, the court seem to have admitted that liabil ity would arise therefrom.
Liability for Honest Misrepresentation. An affirmation of title, though made in good faith by a seller, renders him liable if the title is bad ; 1 Ld. Raym. 593; and the law has taken the further step that even with out such an affirmation an obligation will be implied, at least if the seller was in posses sion when the sale took place; 4 A. & E. 473. At the present day it is nearly universal law that any representation of fact as to the quality of the goods, made for the apparent purpose of inducing the buyer to purchase them, amounts to a warranty ; Williston, Sales 201. Hence, a warranty of title and a warranty of quality must be a misrepresenta tion of an existing fact in precisely the same way that a fraudulent misrepresentation must now be, in order to furnish a basis for action. Iler v. Jennings, 87 S. C. 87, 68 S. E. 1041, furnishes an interesting comparison with the well-known case of Derry v. Peek, 14 App. Cas. 337. In the latter case the plaintiff was induced to take shares in a com pany by a misrepresentation of the directors in regard to a right which they stated had been given by special act of parliament to use steam or other mechanical motive power. In Her v. Jennings the plaintiff was induced to buy shares of stock by representations of the seller as to the corporate assets and lia bilities. In both cases the reasonable in ference was that representations of fact were made for the purpose of inducing the plain tiff to I purchase shares. In Iles v. Jennings it was held that a scienter need not be al leged or proved, but if the statement was made to induce the buyer to purchase, and he did purchase in reliance thereon, the defend ant will be held liable. The English case held that the directors were not liable be cause a seienter was not proved.
An honest misrepresentation, then, made by a seller in regard to the goods sold in order to induce a sale, will render him lia ble.
Entirely analogous to the law of warranty in the sale of goods is the warranty which the law imposes upon an agent that he is authorized to act as such. The agent either • expressly, or by necessary implication of fact, represents that he is an authorized agent, and it was decided in Collen v. Wright, 8 E. & B. 647, that the agent was liable as a warrantor. The case has been followed generally in this country ; Mechem, Agency, § 545 ; and was followed in [1903] A. C. 114.