Duty to aid a companion, voluntary rescue, and fraudulent misrepresentation and concealment

Black-letter propositions

1. 01

   Courts have been slow to recognize a duty to render aid to a person in peril, and where such a duty has been found it has been predicated on a special relationship between the parties.

2. 02

   If a defendant with a special relationship knew or should have known of the other person's peril, the defendant is required to render reasonable care under all the circumstances.

3. 03

   Companions on a social venture, engaged in a common undertaking, have a special relationship, and implicit in the undertaking is the understanding that one will render assistance to the other when he is in peril if he can do so without endangering himself.

4. 04

   A companion who knew or should have known that the other was badly injured and unconscious in his car and that no one would find him before morning had an affirmative duty to obtain medical assistance or at least to notify someone of the person's condition and whereabouts.

5. 05

   A person who voluntarily comes to the aid of another must exercise reasonable care, and a jury may find that a person who failed to use reasonable care after voluntarily aiding a victim was a proximate cause of the victim's death.

6. 06

   The essential elements of actionable fraud are a false representation or concealment of a material fact, reasonably calculated to deceive, made with intent to deceive, which does in fact deceive, resulting in damage to the injured party.

7. 07

   A subsisting or ascertainable fact, as distinguished from a matter of opinion or a representation relating to future prospects, must be misrepresented for fraud, and the misrepresentation must generally be definite and specific, with the specificity required depending on the tendency of the statements to deceive under the circumstances.

8. 08

   A vague statement that a business is profitable may be treated as one of fact where the speaker had peculiar knowledge of the facts and knew that the business had lost money, but where the listener knows the speaker lacks knowledge, the statement is obviously a guess or opinion and is not actionable fraud.

9. 09

   Whether a positive representation that a business was a gold mine and a going concern was intended and received as an expression of opinion or as a statement of a material fact may be a question for the jury.

10. 10

    Where a home seller knows of facts materially affecting the value of the property that are not readily observable and are not known to the buyer, the seller has a duty to disclose them, because the distinction between concealment and affirmative representation is tenuous when the nondisclosure is calculated to induce a false belief.

Use this attack sequence under time

Common wrong turns

• A stranger has no general duty to aid, and a duty comes from a special relationship or a voluntary undertaking.
• A statement of opinion or of future prospects is generally not a misrepresentation of fact, unless the speaker has peculiar knowledge that makes it one.
• A vague statement can be treated as fact when the speaker has superior knowledge that contradicts it.
• Concealment of a known hidden defect can be as actionable as an affirmative statement.

Worked example

Two friends spend the evening together, and one is badly beaten and falls unconscious in the back seat of the other's car. The friend drives home, cannot rouse him, leaves him in the car, and does nothing. The injured man dies.

Practice this topic

Duty to aid

Farwell v. Keaton held that a friend who accompanied the victim on the evening he was fatally injured, and who knew or should have known of his peril, had an affirmative duty to come to his aid, explaining that courts have been slow to recognize a duty to aid, that such a duty has been predicated on a special relationship, that companions on a social venture engaged in a common undertaking have such a relationship implicit with the understanding that one will render assistance to the other in peril if he can do so without endangering himself, and that the jury could find that the friend failed to exercise reasonable care after voluntarily aiding the victim.

Fraud

Ragsdale v. Kennedy stated the essential elements of actionable fraud as a false representation or concealment of a material fact, reasonably calculated to deceive, made with intent to deceive, which does in fact deceive, resulting in damage to the injured party, and stated that a subsisting or ascertainable fact rather than an opinion or a representation about future prospects must be misrepresented and that the misrepresentation must be definite and specific to the degree its tendency to deceive requires.

The court also explained that a vague statement such as that a business is profitable may be treated as one of fact where the speaker had peculiar knowledge that the business had lost money, but not where the listener knew the speaker had no knowledge of the facts, and it held that whether a representation that the corporation was a gold mine and a going concern was intended and received as opinion or as a statement of material fact was a jury question.

Concealment by a seller

Johnson v. Davis held that where the seller of a home knows of facts materially affecting the value of the property that are not readily observable and are not known to the buyer, the seller must disclose them, and it reasoned that where failure to disclose a material fact is calculated to induce a false belief the distinction between concealment and affirmative representation is tenuous because both are attended with the same consequences.

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