FRAUD, contracts, torts. Any trick or artifice employed by one person
to induce another to fall into an error, or to detain him in it,
so that he may make an agreement contrary to his interest. The
fraud may consist either, first, in the misrepresentation, or,
secondly, in the concealment of a material fact. Fraud, force
and vexation, are odious in law. Booth, Real Actions, 250. Fraud
gives no action, however, without damage; 3 T. R. 56; and in matters
of contract it is merely a defence; it cannot in any case constitute
a new contract. 7 Vez. 211; 2 Miles' Rep. 229. It is essentially ad
hominem. 4 T. R. 337-8.
Fraud avoids a contract, ab initio, both at law and in equity,
whether the object be to deceive the public, or third persons, or one
party endeavor thereby to cheat the other. 1 Fonb. Tr. Equity,
3d ed. 66, note; 6th ed. 122, and notes; Newl. Cont. 352; 1 Bl.
R. 465; Dougl. Rep. 450; 3 Burr. Rep. 1909; 3 V. & B. Rep. 42;
3 Chit. Com. Law, 155, 806, 698; 1 Sch. & Lef. 209; Verpl. Contracts,
passim; Domat, Lois Civ. p. 1, 1. 4, t. 6, s. 8, n. 2.
The following enumeration of frauds, for which equity will grant
relief, is given by Lord Hardwicke, 2 Ves. 155. 1. Fraud, dolus malus,
may be actual, arising from facts and circumstances of imposition,
which is the plainest case. 2. It may be apparent from the intrinsic
nature and subject of the bargain itself; such as no man in his
senses, and not under delusion, would make on the one hand, and
such as no honest and fair man would accept on the other, which
are inequitable and unconscientious bargains. 1 Lev. R. 111. 3.
Fraud, which may be presumed from the circumstances and condition of
the parties contracting. 4. Fraud, which may be collected and inferred
in the consideration of a court of equity, from the nature and
circumstances of the transaction, as being an imposition and deceit
on other persons, not parties to the fraudulent agreement. 5.
Fraud, in what are called catching bargains, (q.v.) with heirs,
reversioners) or expectants on the life of the parents. This last
seems to fall, naturally, under one or more of the preceding divisions.
Frauds may be also divided into actual or positive and constructive
An actual or positive fraud is the intentional and successful
employment of any cunning, deception, or artifice, used to circumvent,
cheat, or deceive another. 1 Story, Eq. Jur. Sec. 186; Dig. 4, 3,
1, 2; Id. 2, 14, 7, 9.
By constructive fraud is meant such a contract or act, which, though
not originating in any actual evil design or contrivance to perpetrate
a positive fraud or injury upon other persons, yet, by its tendency
to deceive or mislead. them, or to violate private or public confidence,
or to impair or injure the public interests, is deemed equally
reprehensible with positive fraud, and, therefore, is prohibited
by law, as within the same reason and mischief as contracts and
acts done malo animo. Constructive frauds are such as are either
against public policy, in violation of some special confidence
or trust, or operate substantially as a fraud upon private right's,
interests, duties, or intentions of third persons; or unconscientiously
compromit, or injuriously affect, the private interests, rights
or duties of the parties themselves. 1 Story, Eq. ch. 7, Sec. 258 to
The civilians divide frauds into positive, which consists in doing
one's self, or causing another to do, such things as induce a belief
of the truth of what does not exist or negative, which consists
in doing or dissimulating certain things, in order to induce the
opposite party. into error, or to retain him there. The intention
to deceive, which is the characteristic of fraud, is here present.
Fraud is also divided into that which has induced the contract,
dolus dans causum contractui, and incidental or accidental fraud.
The former is that which has been the cause or determining motive
of the contract, that without which the party defrauded would
not have contracted, when the artifices practised by one of the
parties have been such that it is evident, without them, the other would
not have contracted. Incidental or accidental fraud is that by
which a person, otherwise determined to contract, is deceived
on some accessories or incidents of the contract; for example,
as to the quality of the object of the contract, or its price,
so that he has made a bad bargain. Accidental fraud does not,
according to the civilians, avoid the contract, but simply subjects
the party to damages. It is otherwise where the fraud has been the
determining cause of the contract, qui causam dedit contractui; in that
case. the contract is void. Toull. Dr. Civ. Fr. Liv. 3, t. 3, c. 2,
n. Sec. 5, n. 86, et seq. See also 1 Malleville, Analyse de la,
Discussion de Code Civil, pp. 15, 16; Bouv. Inst. Index, h.t.
Vide Catching bargain; Lesion; Voluntary Conveyance.
STATUTE OF. The name commonly given to the statute 29 Car. II., c.
3, entitled "An act for prevention of frauds and perjuries." This statute
has been re-enacted in most. of the states of the Union, generally with
omissions, amendments, or alterations. When the words of the statute
have been used, the construction put upon them has also been adopted.
Most of the acts of the different states will be found in Anthon's
Appendix to Shep. Touchst. See also the Appendix to the second
edition of Roberts on Frauds.
[Bouvier's Law Dictionary, Sixth Edition, 1856:]
in its elementary common law sense of deceit -- and this is one of the
meanings that fraud bears [483 U.S. 372] in the statute, see United
States v. Dial, 757 F.2d 163, 168 (7th Cir.1985) -- includes the deliberate
concealment of material information in a setting of fiduciary obligation.
A public official is a fiduciary toward the public, including,
in the case of a judge, the litigants who appear before him, and if
he deliberately conceals material information from them, he is guilty
of fraud. When a judge is busily soliciting loans from counsel to one
party, and not telling the opposing counsel (let alone the public),
he is concealing material information in violation of his fiduciary
* * *
the systematic and long-continued receipt of bribes by a public official,
coupled with active efforts to conceal the bribe-taking from the public
and the authorities . . . is fraud (again in its elementary sense of
deceit, and quite possibly in other senses as well), even if it is the
public, rather than counsel, that is being kept in the dark. It is irrelevant
that, so far as appears, Holzer never ruled differently in a case because
of a lawyer's willingness or unwillingness to make him a loan, so that
his conduct caused no demonstrable loss either to a litigant or to the
public at large. See, e.g., United States v. Keane, 622 F.2d 534, 541,
546 (7th Cir.1975); United States v. Lovett, 811 F.2d 979, 985 (7th
Cir.1987); United States v. Manton, 107 F.2d 834, 846 (2d Cir.1939).
How can anyone prove how a judge would have ruled if he had not been
v. United States, 483 U.S. 350 (1987)]