McCOMB v. Brewer Lumber Company Supreme Judicial Court, Massachusetts, October 21, 1903. Reported in 184 Massachusetts Reports, 276

The third count in the declaration is tort for deceit in the sale of certain stock by the defendant to the plaintiff.

The allegations, so far as material here, are in substance as follows:—

Plaintiff says that the defendant, by its agent, with intent to deceive and defraud the plaintiff, falsely and fraudulently represented to him [here specifying certain representations], and that, if the plaintiff would purchase a certain number of shares of stock in the defendant corporation and pay therefor the sum of $9000, ... the $9000 paid by the plaintiff should be put in the treasury of said corporation to be used as a working capital. And plaintiff says that, relying upon the representations, he bought the shares and paid therefor $9000; and plaintiff says that said representations were false and untrue to the knowledge of the defendant in this: [specifying certain particulars], and the $9000 paid by plaintiff was not put in its treasury and used as working capital, but was, with the approval of the defendant, its directors and manager, used for other purposes than the business of the defendant.

Verdict for plaintiff for $1.00 damages. Plaintiff alleged exceptions as to the ruling at the trial in reference to this count.

Hammond, J.... The exceptions relate only to the third count, and since the verdict was for the plaintiff on this, they are material only so far as they respect the question of damages. The principal difference between the instructions given by the judge and those requested by the plaintiff is that the judge declined to permit the jury to consider the allegation with reference to the promised use of the $9000 paid by the plaintiff for the stock. As to this it is contended by the plaintiff that at the time the defendant promised to use the money as working capital it did not intend to keep the promise, and that a representation of a present intention is a representation of an existing fact and therefore may be false and fraudulent. But, without implying that the plaintiff’s contention would be true under any circumstances, the difficulty with his case is that the question is not raised upon the record. The ruling that the jury should not consider the allegation with reference to the promised use of the money appears to have been made with reference to the third count, and, as applied to that, it was correct. An examination of the count will show that it does not contain any allegation that at the time the defendant said that the money should be used for working capital it had not the intention to perform that promise. It first sets out the representations which induced the plaintiff to purchase the stock, then proceeds to state in what respects they were false and fraudulent and the defendant’s knowledge of the falsity, and then follows the only allegation respecting the representation as to the promised use of the money: “And the nine thousand dollars paid by the plaintiff to the defendant was not put in its treasury and used as working capital, but was, with the approval of the defendant, its directors and manager, used for other purposes than the business of the defendant.” This is an allegation that the defendant failed to carry out its promise, and falls far short of an allegation that the defendant at the time it was made did not intend to carry it out. There is no allegation whatever as to the intent of the defendant at the time the promise was made. Indeed it is difficult to read that count, either by itself or in connection with the other counts, without feeling that the pleader studiously avoided alleging anything as to that intent. While the evidence as to the promised use and the actual use of this money may have been admissible upon the second count, the object of which was to recover damages for breach of the promise, it was not material upon the third count, even upon the question of damages, for the reasons above stated.

Exceptions overruled.