False statements as to the existence or effect of a rule of domestic law, applicable to and affecting the rights of the parties, do not constitute fraud at law; nor in equity in many jurisdictions.1 This rule rests on two reasons. The one usually given is that every one is presumed to know the law; but this proposition is applicable chiefly to criminal law; and as we shall see later, does not always apply in civil matters. The real reason for the rule is that where the material facts are known, and the parties are on terms of equality, law is a matter of opinion and every one must know that it is. Where the material facts are known, a false statement as to the legal effect of a will,2 or a tax sale,3 or as to rights under a copyright,4 or that the adversary party has no cause of action,5 or as to rights under a contract,6 as that insured is bound by an inventory of her property before loss and the company is liable only for three-fourths of such valuation less the value of the goods saved,7 or that the insurance company is not liable because the insured had kept gun-powder upon the premises,8 or that certain stock is nonassessable except for twenty percent. of its par value,9 or as to the liability of a liability insurance company to an injured employe;10 that power to an agent to sell includes power to contract for sale;11 that an option is legally binding;12 that an order given by the adversary party to a third party was not binding because it had not

1United States. Upton v. Tribilcock, 91 U. S. 45, 23 L. ed. 203; Mutual Life Ins. Co. v. Phinney, 178 U. S. 327, 44 L. ed. 1088.

Alabama. Georgia Home Ins. Co. v. Warton, 113 Ala. 470, 59 Am. St. Rep. 129, 22 So. 288.

California. Champion v. Woods, 79 Cal. 17, 12 Am. St. Rep. 126, 21 Pac. 534; Haviland v. Southern California Edison Co., 172 Cal. 601, 158 Pac. 328.

Colorado. Court Valhalla, etc., v. Olson, 14 Colo. App. 243, 59 Pac. 883. 653

Illinois. Fish v. Cleland, 33 111. 237; Dillman v. Nadlehoffer, 119 111. 567, 7 N. E. 88; Hooker v. Midland Steel Co., 215 111, 444, 106 Am. St. Rep. 170, 74 N. E. 445.

Indiana. Burt v. Bowles, 69 Ind. 1; First National Bank v. Osborne, 18 Ind. App. 442, 48 N. E. 256.

Maine. Thompson v. Ins. Co., 75 Me. 55, 46 Am. Rep. 357.

Michigan. Mayhew v. Ins. Co., 23 Mich. 105; Milks v. Milks, 129 Mich. 164, 88 N. W. 402; Tradesman Co. v.

Superior Mfg. Co., 147 Mich. 702, 111 N. W. 343 [rehearing denied, 147 Mich. 702, 112 N. W. 708].

Minnesota. Joggar v. Wins low, 30 Minn. 263, 15 N. W. 242.

Missouri. Kingman v. Shawley, 61 Mo. App. 54.

Ohio. Aetna Ins. Co. v. Reed, 33 O. S. 283.

Oregon. Wicks v. Metcalf, 83 Or. 687, 163 Pac. 434 [rehearing denied, Wicks v. Metcalf, 83 Or. 687, 163 Pac. 988].

Pennsylvania. L. L. Satler Lumber Co. v. Exler, 239 Pa. St. 135, 86 Atl. 793.

South Dakota. Nichols & Shepard Co. v. Horstad, 21 S. D. 80, 109 N. W. 509.

Wisconsin. Gormely v. Gymnastic Association, 55 Wis. 350, 13 N. W. 242.

2Dowdall v. Cannedy, 32 111. App. 207. (Here made in good faith by the executor.)

3Warren v. Ritchie, 128 Mo. 311, 30 S. W. 1023.

4Burk v. Johnson, 146 Fed. 209, 76 C. C. A. 567.

5Valley v. Boston & M. R. Co., 103 Me. 106, 68 Atl. 635.

6United States. Mutual Life. Ins. Co. v. Phinney, 178 U. S. 327, 44 L. ed. 1088.

Alabama. Oriel v. Lomax, 94 Aia. 641, 10 So. 232.

Maine. Thompson v. Ins. Co., 75 Me. 55, 46 Am. Rep. 357.

Michigan. Tradesman Co. v. Superior Mfg. Co., 147 Mich. 702, 111 N. W. 343 [rehearing denied, 147 Mich. 702, 112 N. W. 708]; Providence Jewelry Co. v. Bailey, 159 Mich. 285, 123 N. W. 1117.

Ohio. Aetna Ins. Co. v. Reed, 33 O. S. 283.

Oregon. Wicks v. Metcalf, 83 Or. 687, 163 Pac. 434 [rehearing denied, Wicks v. Metcalf, 83 Or. 687, 163 Pac. 988].

South Carolina. Batesburg Cotton Oil Co. v. Southern Ry. Co., 103 S. Car. 494, 88 S. E. 360.

7Georgia Home Ins. Co. v. Warten, 113 Ala. 479, 59 Am. St. Rep. 129, 22 So. 288.

8Aetna Ins. Co. v. Reed, 33 O. S. 283.

9Upton v. Tribilcock, 91 U. S. 45, 23 L. ed. 203.

10Frankfort Marine Accident Plate Glass Ins. Co. v. Wrtty, 208 Pa. St. 569, 57 Atl. 990.

11 McReavy v. Eshelman, 4 Wash. 757, 31 Pac. 35.

12Whittaker v. Improvement Co., 34 W. Va. 217, 12 S. E. 507.

been approved;13 or a statement that a married woman must sign the note evidencing the mortgage debt as well as the mortgage to bar her dower;14 or as to the means by which a new trial could be obtained,15 are none of them fraud.

In other jurisdictions equity gives relief against fraudulent misrepresentations as to the existence or effect of rules of domestic law.16 Thus a misrepresentation as to the legal effect of a deed;17 as to the validity of a deed;18 or as to the liability of an insurance company after loss, as that it was not liable where the insured was not the sole owner of the property insured;19 or where the insured had an insurable interest in only a part of the insured property,20 as where the insured owned the surplus hay beyond that necessary to keep his tenant's cattle through the winter;21 or where the insured property was mortgaged;22 or that the adversary party has no claim for damages, thus securing a release,23 has been held ground for rescinding a contract caused thereby. In many of these cases, however, it will be found that the decisive fact is that a contract has been made or a right surrendered without legal consideration; and that misrepresentation of law has been merely the means of inducing the adversary party to enter into such gratuitous contract.24

13Nichote & Shepard Co. v. Horstad, 21 S. D. 80, 109 N. W. 509.

14Crofut v. Aldrich, 54 111. App. 541.

15Frankfort Marine Accident & Plate Glass Ins. Co. v. Witty, 208 Pa. St. 569, 57 Atl. 990.

16 Benson v. Bunting, 127 Cal. 532, 78 Am. St. Rep. 81, 50 Pac. 991.

Under Sec. 1578 of the California Civil Code, allowing relief where all parties misapprehend the law and make substantially the same mistake, relief may be had for misrepresentation of law: as for a misrepresentation as to the right of the mortgagee to the rents and profits before foreclosure. Gregory v. Clabrough, 129 Cal. 475, 62 Pac. 72: as to the period for which redemption is allowed after sale in foreclosure. German Savings Bank v. Geneser, 116 la. 119, 125, 89 N. W. 201 [citing Marshall v. Westrope, 08 la. 324, 67 N. W. 2571; Williams v. Hamilton, 104 la. 423, 65 Am. St. Rep. 475, 73 N. W. 1029; Owens v. Norwood-White Coal Co. (la.), 133 N. W. 716; Titus v. Ins. Co., 97 Ky. 567, 53 Am. St. Rep. 426, 28 L. R. A. 478, 31 S. W. 127. "There is an equitable rule to the effect that when there is a mistake of law or fact by one party which is induced, aided or accompanied by inequitable conduct of the other containing elements of wrongful intent, such as misrepresentation or concealment, a court of equity will lend its aid and relieve from the consequences of the error." Titus v. Ins. Co., 97 Ky. 567, 53 Am. St. Rep. 426, 31 S. W. 127; Berry v. Whitney, 40 Mich. 65; Berry v. Ins. Co., 132 N. Y. 49, 28 Am. St. Rep. 548, 30 N. E. 254; Hudson v. Glens Falls Ins. Co., 218 N. Y. 133, L. R. A. 1917A, 482, 112 N. E. 728; Wilson v. Ott, 173 Pa. St. 253, 51 Am. St. Rep. 767, 34 Atl. 23. "The weight of authority and the decisions of this court would now forbid that a party, who, with full knowledge of the ignorance of the other contracting party, has not only encouraged that ignorance and made it more dense by his own false and fraudulent misrepresentations, but has wilfully deceived and led that other into a mistaken conception of his legal rights, should shield himself behind the general doctrine that a mere mistake of law . affords no ground for relief."

17Wilson v. Ott, 173 Pa. St. 253, 51 Am. St. Rep. 767, 34 Atl. 23. (As that it passed a fee, while in reality it passed only a life estate.)

18Bridgewater v. Byassee (Ky.), 93 S. W. 35.

19 Berry v. Ins. Co., 132 N. Y. 49, 28 Am. St. Rep. 548, 30 N. E. 254.

20 Hudson v. Glens Falls Ins. Co., 218 N. Y. 133, L. R. A. 1917A, 482, 112 N. E. 728.

Some of the cases involving fraudulent misrepresentation of law concern contracts which are otherwise invalid. If, by reason of a misrepresentation of law, a contract without consideration, to surrender legal rights is entered into such contract is unenforceable.25

Even under a statute which provides for relief against a mistake of law under certain circumstances, one who signs a written contract of release knowing its terms and relying upon the statement of the adversary party that such contract will not be binding, and that signing it is necessary in order to have the name of the party who signs it placed upon the pay-roll again, can not avoid such written release on the ground of mistake or fraud as to a matter of law.26

Under a statute which renders invalid a contract entered into under mistake of law by one party, of which the other knowingly takes advantage, a fraudulent representation of law,27 such as a representation that a married woman's signature to her husband's note does not impose personal liability upon her, but that it is necessary to render the mortgage valid,28 renders invalid a contract induced thereby.

21 Hudson v. Glens Falls Ins. Co., 218 N. Y. 133, L. R. A. 1917A, 482, 112 N. E. 728.

22 Titus v. Ins. Co., 97 Ky. 567, 53 Am. St. Rep. 426, 28 L. R. A. 478, 31 S. W. 127. This was said to be "a case of actual fraud where, by fraudulent misrepresentations made for the purpose and with intent to deceive, the known ignorance of one of the parties has been taken advantage of and he has thereby been induced to surrender a valid subsisting right without consideration."

23Mensforth v. Chicago Brass Co., 142 Wis. 546, 126 N. W. 41.

24 Titus v. Ins. Co., 97 Ky. 567, 53 Am. St. Rep. 426, 28 L. R. A. 478, 31 S. W. 127; Berry v. Ins. Co., 132 N. T. 49, 28 Am. St. Rep. 548, 30 N. E. 254; Wilson v. Ott, 173 Pa, St. 253, 51 Am. St. Rep. 767, 34 Atl. 23.

25 Berry v. Ins. Co., 132 N. Y. 49, 28 Am. St. Rep. 548, 30 N. E. 254; Wilson v. Ott, 173 Pa. St. 253, 51 Am. St. Rep. 767, 34 Atl 23.

26Haviland v. Southern California Edison Co., 172 Cal. 601, 158 Pac. 328.

27Orth v. Procise, 38 N. D. 580, 165 N. W. 557.

28Orth v. Procise, 38 N. D. 580, 165 N. W. 557.