facts, to establish a presumption of fraud, and entitle the party wronged to relief.1.

Contracts made by persons under the influence of liquor, even when not completely intoxicated, are governed by the same principles which apply to other cases, where one party is in a position to expose him to the exercise of an improper influence by the other. If carried so far that the reasoning powers are destroyed, the contract is void; but when it falls short of this, the contract will not be avoided, unless undue advantage (which however the law seems to presume) has been taken of the condition of the drunken party. Thus if a party while excited by liquor has been led into a hard and disadvantageous bargain, the contract will be set aside in equity. And the same is true of transactions with persons whose minds are enfeebled by habitual intoxication, though not intoxicated when the contract was made.2

Gifts also of property, made by a person in a state of mental imbecility owing to habitual intoxication, will often be treated as void upon the presumption of imposition. Thus a person in such a condition made a voluntary and irrevocable deed of gift of his whole estate to a cousin german, to the disherison of his half-sister, reserving however the use to the donor during his life. No reasonable motive was assigned for the act; and it was held that fraud and imposition might be inferred from the very nature of the transaction.3

What has been said thus far, though relating to transactions inter vivos, is equally applicable to questions of the 1 See Hervey v. Hervey, 1 Atk. 564; v. Pecks, 1 Munf. 518; Rutherford v. Mountain v. Bennet, 1 Cox, 353; Ruff, 4 Dessaus. 350; Rowland v. Nantes v. Corrock, 9 Ves. 183; White Sullivan, ib. 518; Brogden v. Walker, v. Small, 2 Ch. Cas. 103; Portengton 2 Har. & J. 285; Gibson v. Jeyes, v. Eglington, 2 Vern. 189; Donegal's 6 Ves. 275. Case, 2 Ves. 408; Bridgman v. Green, ib. 627; Norton v. Rilly, 2 Eden, 286; Wright v. Proud, 13 Ves. 136; Huguenin v. Baseley, 14 Ves. 273; Harvey

2 Birdsong v. Birdsong, 2 Head, 289. 8 Samuel v. Marshall, 3 Leigh, 567; Adams v. Ryerson, 2 Halst. Ch. 328; Hale v. Brown, 11 Ala. 87.

validity of wills obtained from testators in the like situations. Imposition upon weakness, though insufficient to constitute what would be fraud upon a person in health and strength of body and mind, would be ground for setting aside a will. Indeed in cases of weakness of mind at the time of executing a will strong evidence will be required at the outset, in the probate of the instrument, that its contents were known to the testator, and that the execution was his spontaneous act.1 Still where the testator's capacity is clearly proved, he will be presumed to have been cognizant of its contents.2 The presumption however will not be conclusive; and suspicious circumstances in regard to the origin or execution of the will must be wholly cleared up where there is evidence of weakened mental power. The will in case of weakness of that kind must result, it is held, from the decedent's own suggestion, free from any influence.1

3

1 Mitchell v. Thomas, 6 Moore, P. C. 137; Durnell v. Corfield, 8 Jur. 915; Tribe v. Tribe, 13 Jur. 793; In re Welsh, 1 Redf. 238.

480.

2 Barry v. Butlin, 2 Moore, P. C.

8 In re Welsh, supra.

4 Ib.

CHAPTER II.

CONDUCT SUBSEQUENT.

§ 1. INTRODUCTORY.

THE second division of constructive fraud differs from the first in that the burden of proof rests upon the plaintiff; it differs from fraud proper both in its origin and in its effect. Fraud, in the proper sense of that term, consists in deception touching motives or in circumvention not touching motives. And we have seen that the characteristic feature of the law of fraud in the form of deception is that an action for damages may be maintained against the wrong-doer. The second division of constructive fraud differs from fraud at these points; there was no wrongful purpose at the outset, when the right affected was conferred, and the wrong when done is more limited in legal effect in that an action for damages is not a general and characteristic remedy. Indeed there are but few cases in which such an action for damages is maintainable for any of the wrongs now referred to.

This second division of constructive fraud, embracing all cases in which the burden of proof rests upon the plaintiff, includes, as heretofore intimated,2 the subjects of notice, innocent misrepresentation, fraud on powers, perversion of the Statute of Frauds in cases of verbal contracts concerning the purchase of land, and surprise. In this order these subjects will now be considered. In all of them that which constitutes the constructive fraud lies, as we have said, not in the original act, but in subsequent misconduct, i. e. in trying to turn the original act to a wrongful end. They may therefore be considered under the head of Conduct Subsequent.

1 Ante, pp. 18, 68.

2 See ante, pp. 11-13.

§ 2. NOTICE: ITS RELATION TO FRAUD.

He who confederates with another, even if only as a professed agent,1 to defraud me and succeeds is liable in damages equally with his associate; but he who merely takes a title under the wrong-doer, without participation in the wrongdoing, is not guilty of fraud however cognizant of the fraud of him under whom he claims. Though the fraud of the predecessor be deception, no action for distinctive damages can be maintained against the successor; that is, no action for the fraud, such as could be maintained against the wrong-doer, can be supported against the taker from him. He must indeed give up what he has received from the wrong-doer, or its avails if he has disposed of it; but that is all. Thus a purchaser from an executor with notice of a breach of trust by the latter is bound only to give up what he has received; he is not liable to the same extent as the executor.2 The taker's misconduct then, like that of the party making the innocent misrepresentation, falls short of fraud; it is constructive

fraud.

The existence of a right of action for damages is not to be taken however as a general test of the presence of fraud, for circumvention may be fraud as truly as deception, as we have seen; and in pure circumvention there is no right of action for damages according to the better view, except in cases of sale or the like by a part owner.3 The existence of a right to recover damages is (apart from the cases just mentioned) only a test of the presence of fraud in the form of deception, or of circumvention with deception. Now just as one who takes with notice, or as a volunteer, under a party who has been guilty of fraud by deception may be treated as guilty of

1 Reed v. Peterson, 91 Ill. 288; Arnot v. Biscoe, 1 Ves. Sr. 95; Seddon v. Connell, 10 Sim. 86. See also Walker v. Coleman, 81 Ill. 390.

2 Willis v. Foster, 65 Ga. 82.

3 Ante, p. 18, note; Sweet v. Morrison, 103 N. Y. 235.

constructive fraud, so also one who takes with notice, or as a volunteer, under a party guilty of fraud by circumvention (e. g. a debtor conveying property in fraud of creditors) may be treated as guilty of constructive fraud. In some states however, as in Massachusetts, so pronounced is the view that a purchaser with notice of an intent by his vendor to defraud creditors is not to be treated as guilty of fraud merely because of the notice or knowledge, that he actually acquires a good title; if he did not participate in the wrongful intent, he is not guilty even of constructive fraud. But that is not the generally accepted rule.

§ 3. CONSTRUCTIVE NOTICE: DUTY TO INQUIRE.

Certain cases falling under the head of actual notice, which, it should be observed, is not knowledge, have already been considered in treating of employers.2 Knowledge of an agent is, within certain limits, actual notice to his principal; other cases of actual notice will be considered in subsequent sections. Here we are to consider another class of cases, cases not of knowledge of the fraud by any one, except by the party who committed it, but cases of constructive notice of the fact.

The general proposition of law concerning constructive notice is, that if facts are brought to the knowledge of a party which would put him, as a man of common sagacity, upon inquiry, he is bound to inquire; and if he fail to do so, or to do so properly, whether fraudulently or only negligently, he will be chargeable with notice of what he might have learned upon reasonable examination. Where for example a party has had knowledge or notice that property in dispute

1 Hill v. Ahern, 135 Mass. 154. 2 Ante, pp. 236-240.

8 Warren v. Swett, 31 N. H. 332; Cambridge Bank v. Delano, 48 N. Y. 326; Acer v. Wescott, 46 N. Y. 384; Willis v. Vallette, 4 Met. (Ky.) 186; Russell v. Ranson, 70 Ill. 167; Watt v.

Scofield, ib. 261; Dickey v. Lyon, 19 Iowa, 544; Woodworth v. Paige, 5 Ohio St. 70; James v. Drake, 3 Sneed, 540; Colquitt v. Thomas, 8 Ga. 258; Martel v. Somers, 26 Tex. 551; Jones v. Smith, 1 Hare, 43; Kennedy v. Green, 3 Mylne & K. 699, 718.