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.
The second question to consider in discussing the elements of fraud is what is a material fact. The false representation must be of a fact,1 as distinguished from statements, such as opinions and promises which are not facts.2 What representations are representations of fact may be better illustrated by examples than stated as an abstract rule. Thus statements concerning title,3 or encumbrances,4 as that a certain incumbrance is a first lien,5 or false representations as to agency,6 are material. A statement as to the area of a specific tract,7 at least if a survey would be necessary to show that such statement was false,8 even if the boundaries of the tract are known,9 as to the location of land,10 as that it is located on a street11 that is above the established grade of the street,12 or is in a large city,13 or within a certain distance of a railway station,14 that the water-right sold with the land is sufficient to irrigate it all;15 that an irrigating plant is in a certain specified condition;16 that lands leased are tiled wherever needed;17 that realty is high and dry and located at a designated place;18 that a stream never overflowed on the land
15 Coulter v. Clark, 160 Ind. 311, 66 N. E. 739.
16 Brown v. Kimball, S4 Me. 280, 24 Atl. 847; McKinney v. Whiting, 90 Maes. (8 All.) 207.
17 Heintz v. Mueller, 19 Ind. App. 240, 49 N. E. 293.
18 Wells v. Prince, 82 Mass. (15 Gray) 562.
19 See cases cited in this section.
20 Howard v. Allgood, 143 Ga. 550, 85 S. E. 757; Dent v. McGrath, 66 Ky. (3 Bush) 174. See cases cited in notes 3 et seq. of this section.
21 Cook v. Churchman, 104 Ind. 141, 3 N. E. 759; Knight v. Rawlings, 205 Mo. 412, 13 L. R. A. (N.S.) 212, 104 S. W. 38.
22 Knight v. Rawlings, 205 Mo. 412, 13 L. R. A. (N.S.) 212, 104 S. W. 38.
1 Schultheis v. Sellers, 223 Pa. St. 513, 22 L. R. A. (N.S.) 1210, 72 Atl. 887.
2 See Sec. 291 et seq.
3 See Sec. 396.
4 See Sec. 326 et seq.
5 Kehl v. Abram, 210 III. 218, 102 Am. St. Rep. 158, 71 N. E. 347.
6 See ch. LIV.
7 California. Morris v. Courtney, 120 Cal. 63, 52 Ac. 129.
Illinois. Peake v. Walton, 52 111. App. 90.
Indiana. Moore v. Harmon, 142 Ind. 555, 41 N. E. 599.
New York. Beardsley v. Duntley, 69 N. Y. 577.
North Dakota. Heald v. Yumisko, 7 N. D. 422, 75 N. W. 806.
Oregon. Jeffreys v. Weekly, 81 Or. 140, 158 Ac. 522.
Pennsylvania. Griswold v. Gebbie, 126 Pa. St. 353, 12 Am. St. Rep. 878, 17 Atl. 673.
South Carolina. Welborn v. Cobb, 92 S. Car. 384, 75 S. E. 691.
Washington. Best v. Offield, 59 Wash. 466, 30 L. R. A. (N.S.) 55, 110 Ac. 17.
Even if as between the government and the first purchaser, the official survey conclusively but erroneously fixes the area at that stated: Heald v. Yumisko, 7 N. D. 422, 75 N. W. 806.
So as to a representation as to the area of a carpet: Lewis v. Jewell, 151 Mass. '345, 21 Am. St. Rep. 454, 24 N. E. 52.
8 George v. Kurdy, 92 Wash. 277, 158 Ac. 965.
9 Sipola v. Winship, 74 N. H. 240, 66 Atl. 962.
Contra: Mabardy v. McHugh, 202 Mass. 148, 132 Am. St. Rep. 484, 88 N. E. 894; Adams v. Ladeau, 84 Vt. 460, 79 Atl. 996.
10 J. B. Millet Co. v. Andrews, 175 Mich. 350, 141 N. W. 578; Wilson v. Robinson, 21 N. M. 422, 155 Ac. 732.
11 Durkin v. Cobleigh, 156 Mass. 108, 32 Am. St. Rep. 436, 17 L. R. A. 270, 30 N. E. 474; Ballard v. Lyons, 114 Minn. 264, 38 L. R. A. (N.S.) 301, 131 N. W. 320; Hoock v. Bowman, 42 Neb. 80, 47 Am. St. Rep. 691, 60 N. W. 389.
12 Dinwiddie v. Stone, 21 Ky. Law Rep. 584, 52 S. W. 814.
13 Powers v. Fowler, 157 Mass. 318, 32 N. E. 166.
14 Hoist v. Stewart, 161 Mass. 516, 42 Am. St. Rep. 442, 37 N. E. 755 (and that trains in and out of the city stop at such station aŁ stated intervals).
15 Hill v. Wilson, 88 Cal. 92, 25 Ac. 1105; Hagadorn Investment Co. v. Rieke, 60 Colo. 555, 155 Ac. 381.
16 Tracy v. Smith, 175 Cal. 161, 165 Ac. 535.
17 Baker v. Fawcett, 69 111. App. 300.
18 Hecht v. Metzler, 14 Utah 408, 60 Am. St. Rep. 906, 48 Ac. 37.
sold;19 that damaging frosts do not occur in that locality;20 that a certain amount of hay has been cut from the land;21 that there are a certain number of fruit trees on the land which is sold;22 that the land is in good condition for cropping,23 if taken to mean that it is free from weeds which prevent successful cropping;24 or other facts affecting the condition, quality, and the like, of realty,25 are material facts. Still more is fraudulently designating a different and more valuable tract, fraud.26 So false statements of the existence of minerals on the realty.27 A fraudulent statement as to the area of ground which is underlaid with deposits of coal, the vendor having already sold so much coal land that the remainder of such tract is much smaller than he represents, is fraud for which specific performance will be denied;28 or of the amount of timber thereon,29 are material facts. Statements concerning the value and utility of a patent-right,30 that the patented article has had a certain sale,31 or is satisfactory to those using it,32 or that certain results can be obtained thereby,33 are material facts. The authorities are not unanimous on the question of statements as to patented articles, and they have been treated as mere opinions.34 A statement as to assets and debts of a business;35 a false statement by one selling out an express business as to number of customers, monthly receipts and net annual receipts;36 as to the running expenses of a ranch and the price received in former years for the different crops;37 a statement as to dividends paid,38 misdescribing overdrafts as "loans and discounts";39 a false statement as to the persons who have bought stock in a given corporation,40 or as to an offer made for stock, said to have been refused;41 a statement as to the amount of an estate,42 as where the share of the heir is understated and the debts are overstated;43 or as to the number and amount of payments made upon a mortgage debt which is being assigned,44 are all material facts.