Even in actions in form claiming damages for deceit there is much authority to support the proposition that a defendant may be liable for honestly misrepresenting facte in regard to which he might reasonably be supposed to be peculiarly well informed. In Cooley on Torts it is laid down that a person is liable for deceit when he "supposed his representations to be true, but had no reason for any such belief, and nevertheless made them positively as of known facts, and induced the other to act upon them." 37 This statement is supported by many authorities.
In 1827 Chief Justice Best, in referring to the basis of liability on a warranty by false affirmation, said: "He who affirms either what he does not know to be true, or knows to be false, to another's prejudice and his own gain, is both in morality and law guilty of falsehood, and must answer in damages."38
36 14 App. Cas. 337.
37 Vol. 2 (3d ed.), 956.
Doubtless it is clear enough to-day that the law of England sanctions no such broad rule, but it is equally clear that Amer-can courts which should refuse to follow the decision of the House of Lords in Derry v. Peek 39 would have good old English authority behind them. It is impossible here to examine the decisions in detail. They cannot be wholly harmonized. The weight of authority would deny recovery unless the defendant's statement was made either with knowledge that it was false or at least without reasonable grounds for believing it to be true; but in judicial statements there is often a blurring of the distinction between reckless or careless honesty and conscious dishonesty.39a Many decisions, however, clearly hold a defendant liable irrespective of good or bad faith, for making a positive false statement as to a matter of which he had, or asserted that he had, special means of knowledge.40
38 Adamson v. Jarvis, 4 Bing. 66. In this case the defendant, who had delivered goods to the plaintiff for the latter to sell as auctioneer, was held liable for his, the defendant's, statement that he was entitled to dispose of them.
In the second edition of Saunders on Reading and Evidence, at page 60 it is said that "in an action for falsely representing a third person fit to be trusted, a scienter must be alleged and proved; though indeed the word 'fraudulently' might be a sufficient allegation in this respect, especially after verdict, Willes, 684. But in an action on the case for fraud, or on misrepresentation of any kind, an express warranty or scienter need not be alleged, nor proved if alleged."
39 14 App. Cas. 337.
39a In the following cases some scienter was held necessary: Kimber v. Young, 137 Fed. 744, 70 C. C. A. 178; Boddy v. Henry, 113 Iowa, 462, 85 N. W. 771, 53 L. R. A. 760; Taylor v. Midline, 161 Ky. 597, 152 S. W. 774; Boulden v. Stilwell, 100 Md. 543, 60
Atl. 609, 1 L. R. A. (N. S.) 258; Reynolds v. Evans, 123 Md. 365, 91 Atl. 564; Nash v. Minnesota Title Ins. Co., 163 Mass. 574, 40 N. E. 1039, 28 L. R. A. 753, 47 Am. St. Rep. 489; Wann v. Northwestern Trust Co., 120 Minn. 493, 139 N. W. 1061; Ray County Sav. Bank v. Hutton, 224 Mo. 43,123 S. W. 47; Page v. Parker, 40 N. H. 47. But see s. c, 43 N. H. 363, 80 Am. Dec. 172; Cowley v. Smyth, 46 N. J. L. 380, 50 Am. Rep. 432; Bingham v. Fish, 86 N. J. L. 316, 90 Atl. 1106; Chester v. Comstock, 40 N. Y. 575; Kountze v. Kennedy, 147 N. Y. 124, 41 N. E. 414, 29 L. R A. 360, 49 Am. St. Rep. 651; Citizens' State Bank v. Cressler (Okl), 170 Pac. 230; Bailey v. Frazier, 62 Oreg. 142,124 Pac. 643; Erie Iron Works v. Barber, 106 Pa. St. 125, 51 Am. Rep. 508; Lamberton v. Dunham, 165 Pa. St. 129,30 Atl. 716. 40 Lehigh Zinc & Iron Co. v. Bam-ford, 150 U. S. 665, 673,37 L. Ed. 1215; Hindman v. First Nat. Bank, 112 Fed. 931, 50 C. C. A. 623; Munroe v;. Prit-chett, 16 Ala. 785, 50 Am. Dec. 203; Jordan v. Pickett, 78 Ala. 331; Prestdishonest conduct on the part of the defendant. Moreover, the difficulty in extending the limits of liability beyond cases where the defendant is consciously dishonest has been increased by the objection of modern judges and lawyers to the use of fiction in expressing the law. Conclusive presumptions are not now much favored, and such terms as "constructive fraud" and "legal fraud" share the disfavor into which conclusive presumptions of fraud have fallen. This disposition is certainly not to be quarreled with. It is better to state the law in terms which will give rise to as little misunderstanding as possible; but the result reached by means of fictitious statement must not be discarded with the fiction when, as has commonly been the case with fictions in the law, the result reached is desirable though the mode of statement is confusing.