Delta School of Commerce, Inc. v. Wood, 766 S.W.2d 424

Supreme Court of Arkansas

1989

Chapter

21

Title

Misrepresentation

Page

828

Topic

The Misrepresentation

Quick Notes

Expressions of opinion which are false and known to be false when made are actionable.

Book Name

Torts Cases, Problems, And Exercises.  Weaver, Third Edition.  ISBN:  978-1-4224-7220-0.

Issue

o         Whether a knowing false opinion of expression that induces somebody to do something is actionable?  Yes.

Procedure

Trial

o         Compensatory damages of $3,064.00 and punitive damages of $ 50,000.00 against Delta and McCray

Supreme

o         We find no error and affirm

Facts

Reasoning

Rules

Pl Wood

Df Delta School of Commerce

What happened?

o         Wood filed suit against Delta, because Wood said Delta induced her into taking a course in nursing by making false representations that the court would lead her to a position of employment similar to that of a licensed practical nurse (LPN).

Jury

o         The jury found in favor of Wood and assessed compensatory damages of $3,064.00 and punitive damages of $ 50,000.00 against Delta and McCray.

Trial Court

o         The trial court entered judgment accordingly. From this order, Delta and McCray appeal.

Supreme Court

o         We find no error and affirm.

Newspaper Article

o         Woods read article about become a nursing assistant.

Discussion with Delta President

o         She asked McCray if nursing assistant was the same as a nurses aide.

o         It is alleged, that McCray said they are phasing out the LPNs in Arkansas, and nurses assistant will be taking the place of the LPN.

o         You will not get rich being a nursing assistant, but the pay would be comparable.

Dropped Out of Program

o         Dropped out after completing 7 months of a 8 or 9 month program, because she discovered she was studying to become a nurses aide.

o         Training for nursing assistants and LPNs are quite different.

McCray Denied The phasing out statement

o         He acknowledged an awareness of the issue by stating that "the question that keeps coming up, whether or not LPN's are being phased out, I've heard before.

McCray Arg

o         Representations were expressions of opinion and predictions of the future.

Court

o         We disagree.

Opinion General Rule Good faith is okay

In general, an expression of opinion, i.e., a statement concerning a matter not susceptible of accurate knowledge, cannot furnish the basis for a cause of action for deceit or fraud.

Opinion Rule know to be false is actionable

o         An expression of opinion that is false and known to be false at the time it is made is actionable.

o         The general rule only applies where the person expressing his or her opinion does so in good faith.

Examples of Puffing

o         This oil well will make money and will pump 50 barrels a day.

o         This is a good house.

In this case

o         The statements made by McCray to Wood that "they are phasing out the LPNs in the State of Arkansas, so the nursing assistants will be taking the place of the LPNs" and that "she would not get rich as a nursing assistant but that the pay would compare to that of an LPN"

o         Were representations of fact, not expressions of opinion.

o         Unlike the loose general statements made by sellers in commending their products which we found to be expressions of opinion in Grendell and Cannaday,

o         The statements made by McCray were specific and definite.

Rule

o         Expressions of opinion which are false and known to be false when made are actionable.

Court Jury Discussion

o         The jury reasonably could have concluded that the statement made by McCray were false that he knew them to be false at the time he made them.

Affirmed

Rules

Opinion General Rule Good faith is okay

In general, an expression of opinion, i.e., a statement concerning a matter not susceptible of accurate knowledge, cannot furnish the basis for a cause of action for deceit or fraud.

Opinion Rule know to be false is actionable

o         An expression of opinion that is false and known to be false at the time it is made is actionable.

o         The general rule only applies where the person expressing his or her opinion does so in good faith.

Rule

o         Expressions of opinion which are false and known to be false when made are actionable.

Class Notes