At common law, as uninfluenced by equity, the original rule seems to have been that misrepresentation which did not affect the formation of the contract and was not made a term thereof had no effect on its validity, even though it concerned a collateral material fact. The action of deceit could not be brought on an innocent misrepresentation in the great majority of jurisdictions.1 But this rule, which was originally thoroughly settled and elementary, is departed from in some jurisdictions which allow the action of deceit on innocent misrepresentations if material and causing damage.2 One who has been induced to undertake a construction contract by misrepresentations as to material, may be allowed compensation for the additional

3 McCarthy v. Catholic Knights, 102 Tenn. 345, 52 S. W. 142 [citing, Miller v. Ins. Co., 107 N. Y. 292, 14 N. E. 271; Clemens v. Supreme Assembly, 131 N. Y. 485, 16 L. R. A. 33, 30 N. E. 4961.

4 Long v. Inhabitants of Athol, 196 Mass. 497, 17 L. R. A. (N.S.) 96, 82 N. E. 665; Fraser v. Aetna Life Ins. Co., 114 Wis. 510, 90 N. W. 476.

5 Fraser v. Ins. Co., 114 Wis. 510, 90 N. W. 476.

6 Long v. Inhabitants of Athol, 195 Mass. 497, 17 L. R. A. (N.S.) 96, 82 N. E. 665.

7 Spring Garden Ins. Co. v. Lemmon, 117 la. 691, 86 N. W. 35.

1 England. Le Lieyre v. Gould (1893), 1 Q. B. Div. 491; Angus v. Clifford (1891), 2 Ch. 449.

Canada. White V. Sage, 19 Ont. App. 135.

United States. Lord v. Goddard, 54

U. S. (13 How.) 198, 14 L. ed. Ill; Dushane v. Benedict, 120 U. S. 630, 30 L. ed. 810; Farrel v. Bank, 43 Fed. 123; Union Ac. Ry. Co. v. Barnes, 64 Fed. 80.

Alabama. Jones v. Ross, 98 Ala. 448, 13 So. 319.

California. Toner v. Meussdorffer, 123 Cal. 462, 56 Ac. 39.

Delaware. Journal Printing Co. v. Maxwell, 1 Penn. (Del.) 511, 43 Atl. 615.

Illinois. Hutchinson, etc., Co. v. Lyford, 123 III. 300, 13 N. E. 844.

Indiana. Furnas v. Friday, 102 Ind. 129, 1 N. E. 296; Lewark v. Carter, 117 Ind. 206, 10 Am. St. Rep. 40, 3 L. R. A. 440, 20 N. E. 119. .

Iowa. Horse-Importing Co. v. Novak, 105 la. 157, 74 N. W. 759.

Kansas. Stevens v. Allen, 51 Kan. 144,32 Ac. 922; Farmers' Stock Breeding Association v. Scott, 53 Kan. 534, 36 Ac. 978; Kansas Refrigerator Co. v. Pert, 3 Kan. App. 364, 42 Ac. 943.

Kentucky. Campbell v. Hillman, 31 Ky. (15 B. Mon.) 508, 61 Am. Dec. 195.

Maine. Hammatt v. Emerson, 27 Me. 308, 46 Am. Dec. 598.

Massachusetts. Hoist v. Stewart, 154 Mass. 445, 28 N. E. 574; Nash v. Trust Co., 163 Mass. 574, 47 Am. St. Rep. 489, 28 L. R. A. 753, 40 N. E. 1039; same case, 159 Mass. 437, 34 N. E. 625.

Minnesota. Hernen v. Neal, 43 Minn. 315, 45 N. W. 612.

Missouri. Redpath v. Lawrence, 42 Mo. App. 101.

New Hampshire. Page v. Parker, 40 N. H. 47.

New Jersey. Cowley v. Smyth, 46 N. J. L. 380, 50 Am. Rep. 432; Crowell v. Jackson, 53 N. J. L. 656, 23 Atl. 426.

New York. Marsh v. Falker, 40 N. Y. 562; Kountze v. Kennedy, 147 N. Y.

124, 49 Am. St. Rep. 651, 29 L. R. A. 360, 41 N. E. 414.

North Carolina. Gatlin v. Harrell, 108 N. Car. 485, 13 S. E. 1D0.

Ohio. Taylor v. Leith, 26 O. S. 428.

Pennsylvania. Kern v. Simpson, 126 Pa. St. 42, 17 Atl. 523; Griswold v. Gebbie, 126 Pa. St. 353, 12 Am. St. Rep. 878, 17 Atl. 673; Lamberton v. Dunham, 165 Pa. St. 129, 30 Atl. 716.

Tennessee. Wynne v. Allen, 66 Tenn. (7 Baxt.) 312, 32 Am. Rep. 562.

"It would introduce a new and very dangerous element into the case to say that the jury must decide whether the defendant had reasonable grounds for his belief." Dilworth v. Bradner, 85 Pa. St. 238, 240 [quoted in Lamberton v. Dunham, 165 Pa. St. 129, 30 Atl. 716]. See Liability for Honest Misrepresentation, by Samuel Willis ton, 24 Harvard Law Review 415.

2 Alabama. Einstein v. Marshall, 58 Ala. 153, 29 Am. Rep. 729.

Michigan. Holcomb v. Noble, 69 Mich. 396, 37 N. W. 497; Mooney v. Davis, 75 Mich. 188, 13 Am. St. Rep. 425, 42 N. W. 802; Busch v. Wilcox, 82 Mich. 315, 46 N. W. 940 [affirmed, 82 Mich. 336, 21 Am. St. Rep. 563, 47 N. W. 328]; Totten v. Burhans, 91 Mich. 495, 51 N. W. 1119; Houder v. Reynolds, 195 Mich. 256, 161 N. W. 856.

Minnesota. Schlechter v. Felton, 134 Minn. 143, 158 N. W. 813.

Nebraska. Johnson v. Gulick, 46 Neb. 817, 50 Am. St. Rep. 629, 65 N. W. 883; Gerner v. Mosher, 58 Neb. 135, 46 L. R. A. 244, 78 N. W. 384.

New York. Bennett v. Judson, 21 N. Y. 238.

Texas. Loper v. Robinson, 54 Tex. 510; Culbertson v. Blanchard, 79 Tex. 486, 15 S. W. 700; St. Louis Southwestern Ry. Co. v. White, 99 Tex. 359, work thus caused.3 An innocent misrepresentation as to the reliability of a horse, amounting to a warranty,4 or as to the identity of land conveyed where the vendor's agent knew the falsity of his statement, though his principal did not,5 or as to the boundaries of land conveyed,6 may give rise to an action for damages.7 Thus an innocent misstatement by one selling accounts as to what ones are unpaid,8 or by a bank director as to the condition of the bank,9 may give rise to an action for damages. Where the statement is made positively and as of the knowledge of the party making it, fraud and misrepresentation become almost indistinguishable.10 A misrepresentation made in a positive manner may amount to negligence.11 A druggist who sells a proprietary medicine which contains a considerable amount of calomel, and who represents that it is a vegetable preparation in tablet form, is liable for damages caused thereby.12 Some courts allow a set-off or recoupment in damages for innocent misrepresentation in an action brought on the contract by the party making such misrepresentations, though they might not allow an original action in tort thereon.13 If A sells B certain land for which B gives his note to A, and A innocently misrepresents that the boundary includes several acres of valuable land which is not in fact included, B can recoup for such damages in an action by A upon such note.14 Further, if the contract has been assigned by the party who has made the misrepresentations, the adversary party may perform and sue for damages.15 It has been suggested that the true rule is that an innocent misrepresentation gives rise to no liability except when made by one party to the contract, and when it is a means of inducing the adversary party to enter into such contract.16 This distinction is plausible, and, in part, true. If there is to be a difference between these two classes of cases, it should operate in this way. But the states which recognize a liability at law due to misrepresentation recognize, in some cases at least, a liability of a third person for misrepresentations.17

122 Am. St. Rep. 631, 2 L. R. A. (N.S.) 110, 80 S. W. 746; Mutual, etc., Association v. McGee (Tex. Civ. App.), 43 S. W. 1030; McCord, Collins, etc., Co. v. Levi, 21 Tex. Civ. App. 109, 50 S. W. 606; Davis v. Driscoll, 22 Tex. Civ. App. 14, 54 S. W. 43.

Washington. Starwich v. Ernst, 100 Wash. 198, 170 Ac. 584.

Wisconsin. Bird v. Kleitier, 41 Wis. 134; Cotzhausen v. Simon, 47 Wis. 103, 1 N. W. 473; Middleton v. Jerdee, 73 Wis. 39, 40 N. W. 629; Montreal River Lumber Co. v. Mihills, 80 Wis. 540, 50 N. W. 507; Gunther v. Ullrich, 82 Wis. 222, 33 Am. St. Rep. 32, 52 N. W. 88; Cameron v. Mount, 86 Wis. 477, 22 L. R. A. 512, 56 N. W. 1094; Beetle v. Anderson, 98 Wis. 5, 73 N. W. 560; Krause v. Busacker, 105 Wis. 350, 81 N. W. 406.

"It is immaterial whether the defendant made the representation wilfully or intentionally or not, for he had no right to make even a mistake in facts so material to the contract, except under a penalty of responding in damages." Cotzhausen v. Simon, 47 Wis.

103, 106, 1 N. W. 473 [quoted in Gunther v. Ullrich, 82 Wis. 222, 33 Am. St. Rep. 32, 52 N. W. 88].

3 Hollerbach v. United States, 233 U. S. 165, 58 L. ed. 898.

4 Cameron v. Mount, 86 Wis. 477, 22 L. R. A. 512, 56 N. W. 1094.

5 Gunther v. Ullrich, 82 Wis. 222, 33 Am. St. Rep. 32, 52 N. W. 88.

6 Starwich v. Ernst, 100 Wash. 198, 170 Ac. 584; Davis v. Nuzum, 72 Wis. 430, 1 L.R. A. 774, 40 N. W. 497.

7 In some cases which may seem to follow this rule there was either a knowledge of the false statement, or a statement made in reckless ignorance of its truth or falsity or a warranty.

8 Totten v. Burhans, 91 Mich. 495, 51 N. W. 1119.

9 Gerner v. Mosher, 58 Neb. 135, 46 L. R. A. 244, 78 N. W. 384.

10 See Sec. 314 et seq.

11 Willson v. Faxon, 208 N. Y. 108, 47 L. R. A. (N.S.) 693, 101 N. E. 799.

12 Willson v. Faxon, 208 N. Y. 108, 47 L. R. A. (N.S.) 693, 101 N. E. 799.

13 Leavitt v. Sizer, 35 Neb. 80, 52 N. W. 832 [citing, Smith v. Richards, 38