DECIDED SEPTEMBER 9, 1964.
Tort; fraud and deceit. DeKalb Civil and Criminal Court. Before Judge Mitchell.
Victor K. Meador, for plaintiff in error.
E. T. Hendon. Jr., contra.
1. (a) In Georgia one of the essential elements to be pleaded in an action for the common law tort of deceit based upon fraud is the speaker's knowledge of the falsity of his representation or ignorance of its truth.
(b) Where alternative allegations of knowledge are attacked by general demurrer the petition is sufficient to withstand attack where the duty to know arises from the relationship, but the petition must capitulate to the demurrer where the duty does not arise by reason of the relationship but arises only after actual knowledge.
(c) In a relationship involving merely a sale of personal property with no extenuating circumstances pleaded, the duty of knowledge does not arise out of the relationship, and actual knowledge must be pleaded.
(d) The petition here alleging only constructive knowledge was properly dismissed on general demurrer.
DECIDED SEPTEMBER 9, 1964.
Rozell Whaley sued Frank Holt and Gene Warren for damages caused by their alleged misrepresentations in the sale of an automobile to her.
Sounding in tort for fraud and deceit, the amended petition shows that on November 28, 1962, the plaintiff was shopping for a car at a used car business operated by the defendants and defendants showed her a 1955 Ford, which she said she would buy if it was in good running order. The defendants assured her that it "was in good working order" and "she would get good service out of it"; and plaintiff, "being ignorant of motors and such" and "acting upon the statements made by defendants," bought the car for $400. Defendants delivered the car to plaintiff, and "told her if anything went wrong for her to bring it back and it would be corrected." Plaintiff took the car after their "assurance to her that it was in first-class mechanical condition and would give her the service for which she purchased it," and drove it home. Continuing, the petition alleges defects in the car, defendants' failure to repair the defects, and other tribulations concerning the car, which ultimately was repossessed by the company financing it for the plaintiff and was sold for $90; and further, the defendants "knew or should have known the condition of the car" and "knew or should have known that said car was worthless for the purposes they sold it to this plaintiff, and while so knowing they delivered to her the said worthless automobile, and defrauded her out of her money." The petition prays for judgment in the sum of $310 net loss ($400, less the $90 for which the finance company resold the car), $750 attorney's fees and $2,500 punitive damages.
The trial judge sustained the defendants' general demurrers to the amended petition to which judgment exceptions are brought.
By admission of counsel for the plaintiff in error the petition in this case does not sound in contract but rests upon the tort of fraud and deceit.
"In Georgia the essential elements of a cause of action for the common-law tort of deceit based upon fraud have been stated to be: . . . (4) the speaker's knowledge of its falsity or ignorance of its truth; . . ." Doanes v. Nalley Chevrolet, Inc., 105 Ga. App. 846, 847 (1) ( 125 S.E.2d 717); Daugert v. Holland Furnace Co., 107 Ga. App. 566, 569 ( 130 S.E.2d 763); Snow's Laundry c. Co. v. Ga. Power Co., 61 Ga. App. 402, 405 ( 6 S.E.2d 159).
The petition is lacking at least in the essential averment that the defendants had actual knowledge of the defective mechanical condition of the automobile sold to the plaintiff. The petition alleges that the defendants "knew or should have known the condition of the car" and "knew or should have known that said car was worthless for the purpose they sold it to this plaintiff." These allegations assert at most a constructive knowledge on the part of the defendants and this is not enough.
Where alternative allegations of knowledge are attacked by general demurrer: (1) the petition is sufficient to withstand attack Where the duty to know arises from the relationship; (2) but the petition must capitulate to the demurrer where the duty does not arise by reason of the relationship but arises only after actual knowledge. Hillinghorst v. Heart of Atlanta Motel, 104 Ga. App. 731, 734 ( 122 S.E.2d 751); and see the numerous cases Hillinghorst cites. Here the relationship between the parties was merely that involving a sale of personal property with no extenuating circumstances pleaded. In this status the duty of the defendants to know of the falsity of their representation does not arise unless the petition charges them with actual knowledge.
The petition having alleged only constructive knowledge by the defendants of the falsity of their representations where an allegation of actual knowledge is essential, the trial court properly dismissed the petition on general demurrer.
Judgment affirmed. Jordan and Eberhardt, JJ., concur.