Civil Model Jury Charge 3.30E FRAUD — DECEIT
Plaintiff
seeks to recover damages which he/she claims he/she sustained as a result of a
misrepresentation made to him/her by the defendant. One who represents as true that which is
false with the intent to deceive the person to whom the representation is made
is liable to that person if he/she, believing the representation to be true
(acts, refrains from acting) in justifiable reliance upon it and suffers damage
as a result.
The burden of proof is on the plaintiff
to establish by clear and convincing evidence each of the following
elements. First, that defendant made a
false representation of fact to him/her.
Second, that defendant knew or believed it to be false. Third, that defendant intended to deceive
plaintiff. Fourth, that plaintiff
believed and justifiably relied upon the statement and was induced by it to
(action taken or omitted). Fifth, that
as a result of plaintiff's reliance upon the statement, he/she sustained
damage.
The first question for you to determine
is what defendant said to the plaintiff.
If it was a statement of opinion rather than a statement of fact,
defendant cannot be held responsible, for opinions are matters of judgment for
which under the circumstances of this case, the law does not impose liability
and your verdict will be for the defendant.
If on the other hand you find that defendant stated in words or
substance that (recite the representations claimed) your finding will be that
defendant made a representation of fact.
If you find that defendant made a
representation of fact, you will next consider whether that representation was
true or false. If you find it was true,
your verdict will be for the defendant.
If you find it was false, you will then determine whether defendant knew
or believed it was false and made the representation with intent to deceive the
plaintiff. A false statement is made
with intent to deceive if it is made with knowledge that it is false.
Whether the plaintiff was justified in
relying on the representation depends upon whether the fact represented is one
that a reasonable man would consider important in reaching a decision in the
transaction in question. Even though it
is not such an important fact, reliance may be justified if the defendant in
making the representation knew that the plaintiff considered it important and
would rely upon it.
If you ultimately conclude that there
was no justifiable reliance by the plaintiff or even if there was not a
substantial factor in plaintiff's decision to enter into the transaction, your
verdict will be for the defendant.
If you find that a reasonable person
would have considered the representation important in deciding whether to
proceed with the transaction or that defendant knew that plaintiff considered
the fact important and would rely on it, and you find that plaintiff's belief
of the representation was a substantial factor in his/her decision to engage in
the transaction, your verdict would be for the plaintiff and your attention
would then turn to the nature and extent of plaintiff's damage.
NOTE TO JUDGE
Prosser, Law of Torts, p. 700
(3rd ed. 1964), Louis Schlesinger Co. v.
Wilson, 22 N.J. 576, 585-586
(1956), Fischetto Paper Mill Supply Inc.
v. Quigley Co., Inc., 3 N.J. 149,
152-153 (1949), Ocean Cape Hotel Corp. v.
Masefield Corp., 63 N.J. Super. 369, 379-380 (1960).
There is much debate about the proper charge as to the burden of proof
in cases involving claims of fraud — common law — equitable or legal. Early case law would indicate that the burden
of proof if equitable relief is sought is “clear and convincing.” If money damages are sought the burden of
proof is “preponderance.” Armel v. Crewick, 71 N.J. Super. 213 (App. Div. 1961); Batka v. Liberty Mutual Fire Ins. Co.,
704 F.2d 684 (3rd Cir. 1983). However, recent case law may have departed
from this distinction, and applied the higher “clear and convincing” standard
to all actions, legal or equitable. Albright v. Burns, 206 N.J. Super. 625 (App. Div. 1986); Intile Realty v. Raho, 259 N.J. Super., 438 (Law Div. 1992); Stochastic Decisions v. DiDominico 236 N.J. Super. 388 (App. Div. 1988). A review of the cited cases is recommended.
