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.
An innocent misrepresentation as to the amount of timber on realty conveyed;1 or as to the extent of physical injuries;2 or that certain barrels leaked even when properly glued inside;3 or as to the existence of insurance on certain property;4 or as to the amount5 or quality6 of articles sold by vendor; or as to the financial condition of a buyer, thereby causing the vendor to extend credit;7 as to the financial condition of a debtor, thereby obtaining an advantageous settlement of his debts;8 as to the solvency of a maker of a note, thus inducing the adversary party to take such note in payment of another;9 as to the amount of ore in certain dumps which were offered for sale;10 or that a former sale was voidable for fraud of the purchaser;11 or that an automobile was made in a certain year and was in perfect running order, when in fact such machine was made in the preceding year, and was not in running order;l2 as to the horse power of a certain automobile, if such representation is made by the manufacturer and is accordingly a statement upon which the purchaser might rely,13 are each sufficient to enable the party misled thereby to avoid the contract which he is thus induced to make. A contract of compromise may be avoided at law for an innocent misrepresentation as to the nature and extent of the injury which constitutes the claim in question,14 as long as such representation is not a mere matter of opinion.15 If a claim agent of a corporation represents that the injuries of an employe are slight, that the tendons are not injured and that the injured person will recover in two or three weeks, when in fact the tendons are injured seriously and the burn is so serious as to require transplanting a large piece of skin, and also to require some important and painful surgical operations to loosen the injured tendons, a release induced by such misstatement may be treated as invalid at law in an action to recover for such injuries, even though it is not alleged that such false statement was made with knowledge of its falsity.16
1 See Sec. 335.
2 Clapp v. Greenlee, 100 la. 586, 69 N. W. 1040.
3 See Sec. 373.
1 McKinnon v. Vollmar, 75 Wis. 82, 17 Am. St. Rep. 178, 6 L. R. A. 121, 43 N. W. 800 (coupled with a mistake as to the identity of the land).
2 Wilcox v. Ry., Ill Fed. 435; Houston, etc., Ry. v. Brown (Tex. Civ. App.), 69 S. W. 651.
3 Byers v. Chapin, 28 O. S. 300.
4 Wilson v. Ins. Co., 5 Fed. 674. 5 Ruff v. Jarrett, 94 111. 475. 6 Thorne v. Prentiss, 83 111. 99 (sale of hams); Ellefritz v. Taylor, 84 Til. App. 396 (sale of a horse).
7 Mooney v. Davis, 75 Mich. 188, 13 Am. St. Rep. 425, 42 N. W. 802.
8 Woodruff v. Saul, 70 Ga. 271.
9 Parmlee v. Adolph, 28 O. S. 10.
10 Evans v. Palmer, 137 la. 425, 114 N. W. 912.
11 Montgomery Door & Sash Co. v. Atlantic Lumber Co., 206 Mass. 144, 92 N. E. 71.
12 Pitcher v. Webber, 103 Me. 101, 68 Atl. 593.
13 Joslyn v. Cadillac Automobile Co. 177 Fed. 863, 101 C. C. A. 77.