This section is from the book "The Law Of Contracts", by William Herbert Page. Also available from Amazon: Commercial Contracts: A Practical Guide to Deals, Contracts, Agreements and Promises.
In a number of cases, however, the courts have permitted the party who has been guilty of successful fraud to reap the reward of his iniquity on the theory that the negligence of the innocent party and his willingness to trust the party who is guilty of the fraud should put the innocent party outside of the protection of the law, while the party who is guilty of fraud can invoke the aid of the law in enforcing the contract into which he has thus induced his innocent and confiding adversary to enter.1 This is said to be especially true if he is requested to read the contract and neglects or refuses to do so,2 or if he knows that the instrument is a settlement of some kind of claim, v. Rhodes, 19 Okla. 21, 21 L. R. A. (N.S.) 490, 91 Ac. 1119; McNinch v. Northwest Thresher Co., 23 Okla, 386, 138 Am. St. Rep. 803, 100 Ac. 524; Ames v. Milam (Okla.), 157 Ac. 941; Frizzell v. Milam (Okla.), 157 Ac. 944; Ely-Walker Dry Goods Co. v. Smith, - Okla. - , 160 Ac. 898.
12 Western Mfg. Co. v. Cotton. 126 Ky. 749, 12 L. R. A. (N.S.) 427, 104 S. W. 758.
1 England. Howatson v. Webb (1908), 1 Ch. 1, 4 B. R. C. 642, 77 L. J. Ch. N. S. 32, 97 L. T. N. S. 730 [affirming Howatson v. Webb (1907), 1 Ch. 537].
United States. Hazard v. Griswold, 21 Fed. 178; Taylor v. Fleckenatein, 30 Fed. 99; Heck v. Missouri Pacific Ry. Co., 147 Fed. 775.
Alabama. Georgia Home Ins. Co. v. Warten, 113 Ala. 479, 59 Am. St. Rep. 129, 22 So. 288; Dunham Lumber Co. v. Holt, 123 Ala. 336, 26 So. 663.
Arkansas. E. A. Lange Medical Co. v. Johnson, 131 Ark. 15, 197 S. W. 1168 (obiter, as representation was in fact, true).
California. Kimmell v. Skelly, 130 Cal. 555, 62 Ac. 1067.
District of Columbia. Whiting v. Davidge, 23 D. C. App. 156; Toledo Computing Scale Company v. Garrison, 28 D. C. App. 243.
Georgia. Chicago, etc., Co. v. Sum-merour, 101 Ga. 820, 29 S. E. 291; Walton Guano Co. v. Copelan, 112 Ga. 319, 52 L. R. A. 268, 37 S. E. 411; Rounsaville v. Leonard Mfg. Co., 127
Ga. 735, 56 S. E. 1030; Weaver v. Rober son, 134 Ga. 149, 67 S. E. 662.
Indiana. Nebeker v. Cutsinger, 48 Ind. 436; Woollen v. Ulrich, 64 Ind. 120; Fisher v. Von Behren, 70 Ind. 19, 36 Am. Rep. 162; Woollen v. Whitacre, 73 Ind. 198; Ruddell v. Dillman, 73 Ind. 518, 38 Am. Rep. 152; Fry v. Day, 97 Ind. 348.
Iowa. McCormack v. Molburg, 43 la. 561; Gulliher v. Ry., 59 la. 416, 13 N. W. 429; Wallace v. Ry.. 67 la. 547, 25 N. W. 772; Reid v. Bradley, 105 la. 220, 74 N. W. 896; Bannister v. Mc-Intire, 112 la. 600, 84 N. W. 707; Shores-Mueller Co. v. Lonning, 159 la. 95, 140 N. W. 197.
Kansas. Redfield v. Baird, 75 Kan. 837, 90 Ac. 782.
Maine. Maine, etc., Ins. Co. v. Hodg-kins, 66 Me. 109.
Missouri. Magee v. Verity, 97 Mo. App. 486, 71 S. W. 472.
Nebraska. Osborne v. Missouri Ac. Ry. Co., 11 Neb. 180, 98 N. W. 685.
North Carolina. Dellinger v. Gillespie, 118 N. Car. 737, 24 S. E. 538.
Ohio. McAdams v. McAdams, 80 O. S. 232, 88 N. E. 542.
Oklahoma. Guthrie & Western R. R.
South Carolina. Baum v. Raley, 53 S. Car. 32, 30 S. E. 713; J. I. Case Threshing Machine Co. v. Dyches, 108 S. Gar. 411, 94 S.E. 1051. (Special receipt of contract signed by defrauded party; agent of adversary party guilty of fraud.)
South Dakota. Farlow v. Chambers, 21 S. D. 128, 110 N. W. 94.
Texas. Gibson v. Brown (Tex. Civ. App.), 24 S. W. 574.
Washington, Stone v. Moody, 41 Wash. 680, 5 L. R. A. (N.S.) 799, 84 Ac. 617.
Wisconsin. Dowagiac Mfg. Co. v. Schroeder, 108 Wis. 109, 84 N. W. 14; Standard Mfg. Co. v. Slot, 121 Wis. 14, 105 Am. St. Rep. 1016, 98 N. W. 923.
"The question * * * will some day have to be determined, viz:, whether the old cases on misrepresentation as to the contents of a deed were not based upon the illiterate character of the person to whom the deed was read over, and on the fact that an illiterate man was treated as being in the same position as a blind man: see Thorough-good's Case, 2 Rep. 9a, and Sheppard's Touchstone, p. 56; and whether at the present time an educated person, who is not blind, is not estopped from availing himself of the plea of non est factum against a person who innocently acts upon the faith of the deed being valid. I agree that the appeal ought to be dismissed": Howatson v. Webb (1908), 1 Ch. 1, 4 B. R. C. 642, 77 L. J. Ch. N. S. 32, 97 L. T. N. S.
730 [affirming Howatson v. Webb (1907), 1 Ch. 537].
"White persons on the faith of another's word alone, every day sign contracts without reading them, the law has ever adjudged this such indifference as will preclude a remedy in event of deception": Bonnot Co. v. Newman, 108 la. 158, 78 N. W. 817 [quoted in Bannister v. Mclntire, 112 la. 600, 84 N. W. 707].
"Where it is evident that the parties sought to be charged might have . known by the exercise of their natural faculties (of) what the instrument contained, the law will not permit them to say that they did not know, but lets the instrument speak for itself and be controlling": Stone v. Moody, 41 Wash. 680, 5 L. R. A. (N.S.) 799, 84 Ac. 617, 85 Ac. 346. (The contract was avoided, however, because of the unconscionable character of the provision which was interpolated fraudulently.)
"We take it the rule is well established that, in the absence of any evidence of incapacity to read, or any trick or artifice resorted to prevent his reading if, a party signing a written instrument that is plain and unequivocal in its terms is bound by its express terms and conditions therein contained, and that he can not set up his own carelessness and his own indolence as a defense, and, because he failed to make use of the faculties possessed by him for determining its conditions, be heard to say that its terms or conditions should be other or different from what they are": Guthrie & Western R. R. v. Rhodes, 19 Okla. 21, 21 L. R. A. (N.S.) 490, 91 Pac. 1119.
2 Standard Mfg. Co. v. Slot, 121 Wis. 14, 98 N. W. 923.
though he is misinformed as to its contents.3 A false statement by the adversary party to the effect that the written contract embodies an oral agreement of the parties, has been said not to be fraud.4 It is said that evidence to the effect that the adversary party to a written contract stated that it contained the oral agreement which the parties had made prior thereto, and that accordingly the party to whom it was offered did not read it, does not establish either fraud or mistake.5 If the grantee of land prepares the deed and reads it to the grantor so as to include certain reservations which are not contained in the deed as written,6 or if the vendee of land prepares a contract and fraudulently inserts a provision to the effect that if such vendee resells any part of such land, the vendor will accept such contract as cash in payment for the land,7 or if one who sells a sifter system represents to the buyer that such system would work with the power and machinery which the buyer has, and the written contract contains such provision, when, in fact, the contract guaranteed the operation of such sifter system only if the buyer furnished a suitable building and ample power,8 the negligence of the party in omitting to read such contract When he could have done so is held to preclude him from avoiding such contract. If the seller's agent and the buyer agree upon the sale of a certain quantity of goods, and the seller's agent then writes out the contract so as to provide for the sale of a much larger quantity, without notifying the buyer of such change, and without stating in express terms that the written contract is in conformity to the oral contract, the buyer who signs such contract without reading it is liable to the seller for the quantity in the written contract.9
It is said that if a party to a written contract does not read it because his eyes are poor and he can not read well, and because he relies upon the statement of the adversary party as to its contents, it is a question of fact for the jury whether he is guilty of negligence which prevents him from avoiding such contract.10 Where
3 Atchison, T. & 8. P. Ry. Co. v. Coltrane, 80 Kan. 317, 102 Ac. 836.
4 Colonial Jewelry Co. v. Bridges, 43 Okla. 813, 144 Ac. 577.
5 Carper v. Ridpath, 168 la. 22, 149 N. W. 841.
6 McAdams v. McAdama, 80 O. S. 232, 88 N. E. 542.
8 J. M. Case Mill Mfg. Co. v. Vickers, 147 Ky. 396, 144 S. W. 76.
9 Rounsaville v. Leonard Mfg. Co., 127 Ga. 735, 56 S. E. 1030.
10 McDonald v. McKinney Nursery Co., 44 Okla. 62, 143 Ac. 191. (In this case, however, the answer did not aHege fraud, but it alleged mutual mistake.) this rule is recognized, it is applied by equity. If A and B have entered into an oral contract and in reducing it to writing terms are omitted as a result of A's negligence, it is said that equity will not relieve A; and B may have specific performance of the written contract as against A.11 Indeed the courts of equity are sometimes less ready to grant relief than are the courts of law.
In many of these cases the court probably felt that it was very doubtful if the fraudulent statement was, in fact, made and relied on; and so resorted to this rule of law to meet a finding of fact which it could not set aside. A high degree of proof should, no doubt, be required in such cases. Written contracts should not be set aside lightly. No justification of any kind can be found, however, for upholding a contract on the ground that a party thereto has gone through the form of signing it and delivering it while he believes it to be an instrument embodying a different transaction and the adversary party has created such belief by his fraudulent statements, and is taking advantage of it. We have long since passed the stage of law in which the outward form is the only thing to be regarded.