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2018 Georgia Code 23-2-51 | Car Wreck Lawyer

TITLE 23 EQUITY

Section 2. Grounds for Equitable Relief, 23-2-1 through 23-2-136.

ARTICLE 3 FRAUD

23-2-51. Fraud as actual or constructive.

  1. Fraud may be actual or constructive.
  2. Actual fraud consists of any kind of artifice by which another is deceived. Constructive fraud consists of any act of omission or commission, contrary to legal or equitable duty, trust, or confidence justly reposed, which is contrary to good conscience and operates to the injury of another.
  3. Actual fraud implies moral guilt; constructive fraud may be consistent with innocence.

(Orig. Code 1863, § 3104; Code 1868, § 3116; Code 1873, § 3173; Code 1882, § 3173; Civil Code 1895, § 4025; Civil Code 1910, § 4622; Code 1933, § 37-702.)

Law reviews.

- For case note, "Lynch v. Waters: Tolling Georgia's Statute of Limitations for Medical Malpractice," see 38 Mercer L. Rev. 1493 (1987).

JUDICIAL DECISIONS

General Consideration

A statement of fact is the foundation of fraud under this section. Daniel v. Dalton News Co., 48 Ga. App. 772, 173 S.E. 727 (1934).

Fraud is not always perpetrated by willful misrepresentations. Sapp v. ABC Credit & Inv. Co., 243 Ga. 151, 253 S.E.2d 82 (1979).

Actionable fraud cannot be based upon a promise as to future events; nor does actionable fraud arise from a mere failure to perform a promise. C.P.D. Chem. Co. v. National Car Rental Sys., 148 Ga. App. 756, 252 S.E.2d 665 (1979).

The general rule is that fraud cannot be predicated upon statements which are promissory in their nature as to future acts. FDIC v. Lattimore Land Corp., 656 F.2d 139 (5th Cir. 1981).

A promise, even a false promise, to perform an act in the future is not a false pretense or false representation, and does not constitute the basis for an action for fraud. FDIC v. Lattimore Land Corp., 656 F.2d 139 (5th Cir. 1981).

Cited in Mangham v. Cobb, 160 Ga. 182, 127 S.E. 408 (1925); Battle v. Williford, 160 Ga. 287, 127 S.E. 762 (1925); Lathrop v. Miller, 164 Ga. 167, 138 S.E. 50 (1927); Bryant v. Bush, 165 Ga. 252, 140 S.E. 366 (1927); Collins v. Collins, 165 Ga. 198, 140 S.E. 501 (1927); King Hdwe. Co. v. Ennis, 39 Ga. App. 355, 147 S.E. 119 (1929); Boyles v. Morgan, 168 Ga. 804, 149 S.E. 149 (1929); Thomas v. Couch, 171 Ga. 602, 156 S.E. 206 (1930); Equitable Bldg. & Loan Ass'n v. Brady, 175 Ga. 43, 164 S.E. 674 (1932); Morton v. Wallace, 177 Ga. 856, 171 S.E. 720 (1933); Dover v. Burns, 186 Ga. 19, 196 S.E. 785 (1938); Young v. Hirsch, 187 Ga. 1, 199 S.E. 179 (1938); Beavers v. Williams, 199 Ga. 114, 33 S.E.2d 343 (1945); McCommons v. Reid, 201 Ga. 500, 40 S.E.2d 73 (1946); Hogg v. Hogg, 206 Ga. 691, 58 S.E.2d 403 (1950); City of Dalton v. United States Fid. & Guar. Co., 216 Ga. 602, 118 S.E.2d 475 (1961); Bagley v. Firestone Tire & Rubber Co., 104 Ga. App. 736, 123 S.E.2d 179 (1961); Fuller v. Dillon, 220 Ga. 36, 136 S.E.2d 733 (1964); Tripp v. Conner, 220 Ga. 2, 136 S.E.2d 744 (1964); Bloodworth v. Bloodworth, 225 Ga. 379, 169 S.E.2d 150 (1969); Walsh v. Campbell, 130 Ga. App. 194, 202 S.E.2d 657 (1973); Hendrix v. Scarborough, 131 Ga. App. 342, 206 S.E.2d 42 (1974); Thibadeau Co. v. McMillan, 132 Ga. App. 842, 209 S.E.2d 236 (1974); Lewis v. Citizens & S. Nat'l Bank, 139 Ga. App. 855, 229 S.E.2d 765 (1976); Shipman v. Horizon Corp., 245 Ga. 808, 267 S.E.2d 244 (1980); Kessler v. Liberty Mut. Ins. Co., 157 Ga. App. 287, 277 S.E.2d 257 (1981); Duncan v. Poythress, 515 F. Supp. 327 (N.D. Ga. 1981); Goodlett v. Ray Label Corp., 171 Ga. App. 377, 319 S.E.2d 533 (1984); Palmer v. Neal, 602 F. Supp. 882 (N.D. Ga. 1984); Stanford v. Otto Niederer & Sons, 178 Ga. App. 56, 341 S.E.2d 892 (1986); Tarbutton v. All That Tract or Parcel of Land Known as Carter Place, 641 F. Supp. 521 (M.D. Ga. 1986); Duracell, Inc. v. SW Consultants, Inc., 126 F.R.D. 571 (N.D. Ga. 1989); Holmes v. Drucker, 201 Ga. App. 687, 411 S.E.2d 728 (1991); O'Berry v. Cooper, 202 Ga. App. 97, 413 S.E.2d 736 (1991); McLendon v. Georgia Kaolin Co., 782 F. Supp. 1548 (M.D. Ga. 1992); Sears Mtg. Corp. v. Leeds Bldg. Prods., Inc., 219 Ga. App. 349, 464 S.E.2d 907 (1995); Garbutt v. Southern Clays, Inc., 894 F. Supp. 456 (M.D. Ga. 1995); Kodadek v. Lieberman, 247 Ga. App. 606, 545 S.E.2d 25 (2001); Wessinger v. Spivey (In re Galbreath), 475 Bankr. 749 (Bankr. S.D. Ga. 2003).

Fraud Generally

1. In General

Fraud is either actual or constructive, and either constitutes legal fraud. Jordan v. Belvin, 57 Ga. 719, 196 S.E. 132 (1938); Gaultney v. Windham, 99 Ga. App. 800, 109 S.E.2d 914 (1959).

Fraud may be actual or constructive; actual fraud consists in any kind of artifice by which another is deceived, and constructive fraud consists in any act of omission or commission, contrary to legal or equitable duty, trust, or confidence justly reposed, which is contrary to good conscience and operates to the injury of another. Brittain Bros. Co. v. Davis, 174 Ga. 1, 161 S.E. 841 (1931).

Either actual or constructive fraud may consist in the misrepresentation of a material fact. Gaultney v. Windham, 99 Ga. App. 800, 109 S.E.2d 914 (1959).

Fraud is exceedingly subtle in its nature and can be accomplished by infinite means; it may be perpetrated by signs and tricks, and even silence may in some instances amount to fraud. Sapp v. ABC Credit & Inv. Co., 243 Ga. 151, 253 S.E.2d 82 (1979).

Fraud cannot consist of mere broken promises, unfulfilled predictions, or erroneous conjectures as to future events. C.P.D. Chem. Co. v. National Car Rental Sys., 148 Ga. App. 756, 252 S.E.2d 665 (1979).

Constructive fraud, as well as actual fraud, voids the contract at the election of the injured party, and may authorize a rescission of a written release from liability. Southeastern Greyhound Lines v. Fisher, 72 Ga. App. 717, 34 S.E.2d 906 (1945).

While only actual fraud will authorize an ex parte rescission of a sale of personalty so as to enable the aggrieved party to sue at law, as in trover, for property that he may have delivered to the other under the contract, a sale either of realty or of personalty may be rescinded by a court for mere constructive fraud, where the other essentials of the case are established. Puckett v. Reese, 203 Ga. 716, 48 S.E.2d 297 (1948).

2. Misrepresentation Generally

Any misrepresentation intended to deceive and which does deceive is a fraud, for which a party is entitled to a remedy at law. Oliver v. O'Kelley, 48 Ga. App. 762, 173 S.E. 232 (1934); Thompson v. Wilkins, 143 Ga. App. 739, 240 S.E.2d 183 (1977).

In a suit by the seller for the purchase money of land, the defendant purchaser is entitled to plead that he was not put in possession of the premises and that the seller was guilty of false and fraudulent representations as to the existence of liens on the premises, and, upon proof of such facts, a verdict in his favor is authorized. Oliver v. O'Kelley, 48 Ga. App. 762, 173 S.E. 232 (1934).

Where the owner of land represented to the purchaser that there was no encumbrance against the premises sold, thereby inducing him to purchase it, and it was found later to be encumbered, this constituted a fraudulent representation for which relief will be given the purchaser. Oliver v. O'Kelley, 48 Ga. App. 762, 173 S.E. 232 (1934).

A misrepresentation by a director to a person purchasing stock concerning the financial condition of the corporation is actionable. Daniel v. Dalton News Co., 48 Ga. App. 772, 173 S.E. 727 (1934).

To state that a certain individual had signed contract as surety and that her signature was genuine was a misrepresentation of material existing fact, a fraudulent thing in law which would avoid the contract. W.T. Rawleigh Co. v. Kelly, 78 Ga. App. 10, 50 S.E.2d 113 (1948).

Innocent misstatement may amount to negligence but is not fraud. Day v. Randolph, 159 Ga. App. 474, 283 S.E.2d 687 (1981).

In the absence of a confidential relationship a party may not rely and act on the misrepresentations of an opposite party as to the contents of a written instrument where the party signing can read and where no artifice or fraud is practiced which prevents the party signing from reading the instrument. Robi v. Goldstein, 100 Ga. App. 606, 112 S.E.2d 165 (1959).

In the absence of special circumstances one must exercise ordinary diligence in making an independent verification of contractual terms and representations, failure to do which will bar an action based on fraud. Hubert v. Beale Roofing, Inc., 158 Ga. App. 145, 279 S.E.2d 336 (1981).

One cannot claim to be defrauded about a matter equally open to the observation of all parties where no special relation of trust or confidence exists. Hubert v. Beale Roofing, Inc., 158 Ga. App. 145, 279 S.E.2d 336 (1981).

Misrepresentations are not actionable unless the hearer was justified in relying on them in the exercise of common prudence and diligence. Daugert v. Holland Furnace Co., 107 Ga. App. 566, 130 S.E.2d 763 (1963).

Statements as to future acts merely promissory in their nature are not actionable. Boatman v. Citizens & S. Nat'l Bank, 155 Ga. App. 848, 273 S.E.2d 190 (1980).

A misrepresentation of a present state of mind is actionable as fraud. McFarland v. Kim, 156 Ga. App. 781, 275 S.E.2d 364 (1980).

If the plaintiffs represented to the defendant that they would sign a guarantee of defendant's obligations under the lease, knowing that they had no intention of ever doing this in the future, this would not be a broken promise as to a future act but would be a misrepresentation of a present state of mind and actionable as fraud. The failure of the plaintiffs to sign such a guarantee when presented to them by the landlord is some evidence that they had no intention at any time to complete that act. McFarland v. Kim, 156 Ga. App. 781, 275 S.E.2d 364 (1980).

Misrepresentations as to a question of law cannot constitute remediable fraud, because everyone is presumed to know the law and therefore cannot in legal contemplation be deceived by erroneous statements of law, and such representations are ordinarily regarded as mere expressions of opinion. Sorrells v. Atlanta Transit Sys., 218 Ga. 623, 129 S.E.2d 846 (1963).

Duty of party to protect self against fraud.

- While a party must exercise reasonable diligence to protect himself against the fraud of another, he is not bound to exhaust all means at his command to ascertain the truth before relying upon the representations. Ordinarily the question whether the complaining party could have ascertained the falsity of the representations by proper diligence is for determination by the jury. Gaines v. Watts, 224 Ga. 321, 161 S.E.2d 830 (1968).

When the means of knowledge are at hand and equally available to both parties to a contract of sale, if the purchaser does not avail himself of these means, he will not be heard to say, in impeachment of the contract, that he was deceived by the representations of the seller. Lorick v. Na-Churs Plant Food Co., 150 Ga. App. 209, 257 S.E.2d 332 (1979).

3. Actual Fraud

Actual fraud predicated on intent.

- Whether a fraud is actual depends on whether the false representation was made with the purpose and intent to deceive. Gaultney v. Windham, 99 Ga. App. 800, 109 S.E.2d 914 (1959).

In any suit sounding in tort for damages on account of actual fraud, the gist of the action is the purpose and design to deceive. Gaultney v. Windham, 99 Ga. App. 800, 109 S.E.2d 914 (1959).

Actual fraud involves moral guilt, since there must be an intentional purpose to deceive. Turner v. Ware, 2 Ga. App. 57, 58 S.E. 310 (1907); Gaultney v. Windham, 99 Ga. App. 800, 109 S.E.2d 914 (1959).

A material misrepresentation constituting actual fraud may give rise to an independent action in tort for deceit, to recover for damage thus occasioned. In such a suit it is necessary to show, not only that a material misrepresentation was made for the purpose of inducing the plaintiff to act, that he had a right to act, and that he did act thereon to his injury, but it must be shown that such representation was willfully and knowingly false, or what the law regards as the equivalent of knowledge, a reckless or fraudulent representation about that which the party pretends to know, but about which he knows that he does not know, and by which false pretense his purpose and intent is to deceive. Gaultney v. Windham, 99 Ga. App. 800, 109 S.E.2d 914 (1959).

Essential elements.

- In an independent affirmative action for fraud and deceit, which must be predicated upon actual fraud, the plaintiff must allege and prove the following essential ingredients: (1) the defendant made the representations; (2) at the time he knew they were false (or what the law regards as the equivalent of knowledge, a fraudulent or reckless representation of facts as true, which the party may not know to be false, if intended to deceive); (3) the defendant made the representations with the intention and purpose of deceiving the plaintiff; (4) the plaintiff relied upon such representations; (5) the plaintiff sustained the alleged loss and damage as the proximate result of their having been made; and (6) (an element frequently omitted in the cases enumerating the essentials), want of knowledge by the party alleged to have been deceived that the representation was false. It is essential that the plaintiff was deceived and there can be no deceit if the plaintiff knows that the representations upon which he is alleged to have acted were false. Gaultney v. Windham, 99 Ga. App. 800, 109 S.E.2d 914 (1959); Romedy v. Willett Lincoln-Mercury, Inc., 136 Ga. App. 67, 220 S.E.2d 74 (1975); C.P.D. Chem. Co. v. National Car Rental Sys., 148 Ga. App. 756, 252 S.E.2d 665 (1979).

To allege fraud, the claimant must contend the defendant knowingly made a false representation with the intent and purpose of deceiving the plaintiff. Additionally, there must be a reliance on such representations and a loss sustained thereby. The misrepresentations must also relate to a preexisting or present fact and not statements or representations involving future conduct. Cone Mills Corp. v. A.G. Estes, Inc., 377 F. Supp. 222 (N.D. Ga. 1974).

A promise to take title to the property, farm it, pay off the debt existing thereon, and then to reconvey it to the plaintiff, made as an inducement or consideration for the execution of a deed by plaintiff, does not constitute fraud, so as to authorize cancellation of the deed, or a decree of specific performance of the agreement to convey, unless the promise was made with the present intention not to comply with it. A mere failure to comply with the promise would be insufficient to establish such fraudulent intent. Dixon v. Dixon, 211 Ga. 557, 87 S.E.2d 369 (1955).

The five elements of fraud and deceit in Georgia are: (1) false representation made by the defendant; (2) scienter; (3) an intention to induce the plaintiff to act or refrain from acting in reliance by the plaintiff; (4) justifiable reliance by the plaintiff; and (5) damage to the plaintiff. Marriott Corp. v. American Academy of Psychotherapists, Inc., 157 Ga. App. 497, 277 S.E.2d 785 (1981).

The five elements necessary to be shown in an action for fraud are that the misrepresentation or falsehood was knowingly made, that it related to a material fact, that its purpose was to deceive another and induce him to act, that he did act upon it and that he was injured as a result. Day v. Randolph, 159 Ga. App. 474, 283 S.E.2d 687 (1981).

Actual fraud is not essential to support an action in equity to rescind a contract for fraud, or to a plea of fraud to a suit on a contract; innocently made material misrepresentations which the opposite party has a right to act on, and does act on to his injury, and which amount only to constructive fraud, being sufficient in these last two instances. By a parity of reasoning, actual fraud is not essential to the setting aside of an accord and satisfaction. Jordan v. Belvin, 57 Ga. 719, 196 S.E. 132 (1938).

An independent action in tort for deceit must be grounded on actual fraud. Plough Broadcasting Co. v. Dobbs, 163 Ga. App. 264, 293 S.E.2d 526 (1982).

A theft offense constitutes actual moral fraud, and the trial court did not err in failing to charge the differences between the two types of fraud where defendant admitted theft. Alford v. Oliver, 169 Ga. App. 865, 315 S.E.2d 299 (1984).

Invoice practices constituted evidence from which a jury might have concluded that a contractor engaged in covert dealings with employee, and the employee's alleged destruction of business records might have been considered evidence of fraud under O.C.G.A. § 23-2-51. GIW Indus. v. JerPeg Contr., Inc., 530 F. Supp. 2d 1323 (S.D. Ga. 2008).

4. Constructive Fraud

Constructive fraud does not involve moral guilt, since it is the act itself, as taken in connection with the relationship of the parties, and not the guilty purpose or intent, which constitutes constructive fraud. Gaultney v. Windham, 99 Ga. App. 800, 109 S.E.2d 914 (1959).

Innocent misrepresentations, when made by one charged with a special duty to the opposite party to know and to impart the truth, under the statutes and decisions of this state cannot amount to anything more than constructive fraud, and, as such, are not creative of any independent right of action for damages in tort in favor of the injured party; but they may support an action in equity to rescind a contract so induced or be pleaded in defense to a suit on a contract thus procured, or may, it might seem, under the doctrine of estoppel, be employed in support of an action founded on the contract itself. Gaultney v. Windham, 99 Ga. App. 800, 109 S.E.2d 914 (1959).

If a person having legal title to land, which fact he does not know but has convenient means of knowing, and after a lapse of 27 years, during which time he was under no legal disability, he still has not learned the fact of his interest in the land, and in those circumstances he induces one to buy the land from a third person by representations that the land is the property of such third person, his misrepresentations to the purchaser innocently made, coupled with his delay in ascertaining the truth, will amount to constructive fraud, and they may be pleaded as an estoppel by the purchaser on the faith of the title of his vendor. Lanier v. Bryant, 180 Ga. 409, 179 S.E. 346 (1935).

Where insured furnished false evidence which was relied upon by the insurance company in reinstating insurance policies he was guilty of fraud in law which would avoid the policy, whether he was in good or bad faith and whether he intended to deceive or not. New York Life Ins. Co. v. Odom, 93 F.2d 641 (5th Cir. 1937), cert. denied, 304 U.S. 566, 58 S. Ct. 948, 82 L. Ed. 1532 (1938).

Where insured, in applying for reinstatement of life policies, furnishes false evidence which is relied on by the insurance company, he is guilty of fraud in law which avoids the policy whether he acts in good or bad faith and whether he intends to deceive or not. Life & Cas. Ins. Co. v. Davis, 62 Ga. App. 832, 10 S.E.2d 129 (1940).

Constructive fraud may arise out of any act of omission or commission, contrary to legal or equitable duty, trust or confidence justly reposed, which is contrary to good conscience and operates to the injury of another; constructive fraud may moreover be consistent with innocence and not smacking with moral guilt. Graham v. Hogan, 185 Ga. App. 842, 366 S.E.2d 219 (1988).

"Contrary to good conscience" requirement.

- Where there is no evidence of suppression, misrepresentation or concealment or bad faith so as to impute moral guilt, the mere omission of a matter from a document coupled with the failure to reveal the omission can hardly be even constructive fraud unless it is "contrary to good conscience." Rhodes v. Perimeter Properties, Inc., 187 Ga. App. 55, 369 S.E.2d 332 (1988).

Knowledge not required.

- Constructive fraud is legal fraud, but does not require knowledge or scienter. Macon-Bibb County Hosp. Auth. v. Georgia Kaolin Co., 646 F. Supp. 90 (M.D. Ga. 1986), aff'd, 817 F.2d 98 (11th Cir. 1987).

Evidence of constructive fraud.

- Where claimant was seeking workers' compensation benefits from the employer based on her alleged total disability and inability to work but at the same time she took this position before the Workers' Compensation Board, she was gainfully employed by a different employer, this is evidence sufficient to support the superior court's finding of constructive fraud. Dennington v. Rockdale Package Stores, Inc., 161 Ga. App. 450, 288 S.E.2d 709 (1982).

Nondisclosure.

- Nondisclosure may provide the basis for constructive fraud where a party is under an obligation to communicate. First Union Nat'l Bank v. Davies-Elliot, Inc., 207 Ga. App. 791, 429 S.E.2d 161 (1993).

Even though a bank had a duty to notify its customer of a change in its signature verification procedures, where there was no evidence that the bank refrained from informing its customers in order to induce them to take or refrain from taking any certain action, there was no showing of constructive fraud. Eason Publications, Inc. v. Nationsbank, 217 Ga. App. 726, 458 S.E.2d 899 (1995).

False identities.

- Trial court properly granted summary judgment to the auto dealer, mortgage broker, and the lender on the accused person's contention that they committed constructive fraud by approving and acting upon the credit application filled out by another person who used the accused person's name to obtain the financing necessary to purchase a truck. Constructive fraud is an equitable doctrine that would not support the accused person's request for damages under these circumstances, especially since the evidence did not show they knew or should have known of the impropriety surrounding the transaction. Blakey v. Victory Equip. Sales, Inc., 259 Ga. App. 34, 576 S.E.2d 38 (2002).

Confidential relationships.

- Executor's claim that a brother and a wife committed constructive fraud by withdrawing money from a decedent's bank account while the decedent was living with them prior to the decedent's death was dismissed on summary judgment; even if a confidential relationship existed between the decedent and the brother and the wife, the executor could not seek money damages on a claim brought under O.C.G.A. § 23-2-51(b). Rowland v. Rowland, F. Supp. 2d (N.D. Ga. Nov. 16, 2005).

Constructive fraud not found.

- Superior court did not err in failing to vacate an order allowing an employee to change an authorized treating physician, as the employer failed to show that due to the employee's misleading service and the Board's loss of its pleadings, it was the victim of constructive fraud which amounted to the deprivation of due process; while the employer should have been served with the evidence presented to the administrative law judge, and the Board should have properly handled the employee's filings, the employer could not show that it suffered any harm or injury. MARTA v. Reid, 282 Ga. App. 877, 640 S.E.2d 300 (2006).

No fraud shown on part of developer.

- In an action brought by the purchasers of a lot seeking to cancel the developer's security deed based upon alleged fraud, the trial court properly granted summary judgment to the developer as, even if the developer knew of the sale of the lot to the purchasers, such sale did not estop the developer from the developer's claim against the lot pursuant to the developer's security deed; however, the trial court did err by denying the equitable subrogation claim asserted by the purchasers' lender since exercising subrogation did not prejudice the developer in any manner. Byers v. McGuire Props., 285 Ga. 530, 679 S.E.2d 1 (2009).

5. Inceptive Fraud

When the failure to perform the promised act is coupled with the present intention not to perform, fraud in the legal sense is present; this is known as inceptive fraud, and is sufficient to support an action for cancellation of a written instrument. Cone Mills Corp. v. A.G. Estes, Inc., 377 F. Supp. 222 (N.D. Ga. 1974).

Pleading and Practice

It is error to charge the jury concerning fraud when no harm was done the defendant nor was the defendant deceived or injured in any way as the result of the plaintiff attempting to write in an endorsement on a note which had actually been transferred to it but had not been properly endorsed. Associates Disct. Corp. v. Brantley, 102 Ga. App. 751, 117 S.E.2d 916 (1960).

Diligence is question for jury.

- It is the province of the jury to pass upon all the circumstances of the alleged fraud, and to determine whether or not the party defrauded exercised diligence in discovering the falsity of the misrepresentations. Daniel v. Dalton News Co., 48 Ga. App. 772, 173 S.E. 727 (1934); Daugert v. Holland Furnace Co., 107 Ga. App. 566, 130 S.E.2d 763 (1963).

The purchase by an administrator at his own sale is not in itself fraud. Gormley v. Askew, 177 Ga. 554, 170 S.E. 674 (1933).

Fraud and undue influence can rarely be established by direct proof, accordingly, both may be proved by indirect evidence and by proof of facts from which they may be inferred. Daniel v. Etheredge, 198 Ga. 191, 31 S.E.2d 181 (1944).

Fraud and undue influence are not equivalent terms, but undue influence may be a species of fraud or it may exist without any positive fraud. Daniel v. Etheredge, 198 Ga. 191, 31 S.E.2d 181 (1944).

In order to give rise to an action for damages, the defendant's fraud must be actual, i.e., the misrepresentation must be made either knowingly or with reckless disregard for the consequences. Irvin v. Lowe's of Gainesville, Inc., 165 Ga. App. 828, 302 S.E.2d 734 (1983).

"Innocent" or "constructive" fraud exists only as an equitable doctrine and will not support an action in tort for damages. Irvin v. Lowe's of Gainesville, Inc., 165 Ga. App. 828, 302 S.E.2d 734 (1983).

Fraud may be proved by showing a present intent to dishonor the promise to undertake a future act or present knowledge of the impossibility of an opinion. FDIC v. Lattimore Land Corp., 656 F.2d 139 (5th Cir. 1981).

Instructions.

- It was error for court to charge jury on actual and constructive fraud in language of this section and § 23-2-57, but to neglect to charge on essential elements of actual fraud. Plough Broadcasting Co. v. Dobbs, 163 Ga. App. 264, 293 S.E.2d 526 (1982).

RESEARCH REFERENCES

Am. Jur. 2d.

- 27 Am. Jur. 2d, Equity, § 20. 37 Am. Jur. 2d, Fraud and Deceit, § 4.

C.J.S.

- 30 C.J.S., Equity, § 48 et seq. 37 C.J.S., Fraud, § 2.

ALR.

- Remedy of contractor, who has partially performed before discovering fraud, as to character or amount of work, 2 A.L.R. 1396.

Presence of noxious weeds as ground for rescission of contract for purchase of land, 2 A.L.R. 1511.

Misrepresentation as regards validity of conveyance or transfer of property as fraud, 9 A.L.R. 1051.

False representations in business transaction as within statute relating to 'confidence game,', 9 A.L.R. 1527, 56 A.L.R. 727.

Fraud or perjury in misrepresenting status or relationship essential to the judgment as ground of relief from, or injunction against, judgment, 49 A.L.R. 1219.

May offense of obtaining money or property by false pretenses or confidence game be predicated on obtaining loan or renewal thereof, 52 A.L.R. 1167.

Misrepresentation or mistake as to whether corporate stock is assessable as one of law or of fact, 65 A.L.R. 1256.

Examination of real property by purchaser before entering into contract as precluding rescission on ground of falsity of representations, 70 A.L.R. 942.

Misrepresentation as to market price or market value as fraud, 71 A.L.R. 622.

Fraud: necessity for knowledge of falsity of representation as to value, inducing subscription to or purchase of corporate stock, or other securities, 73 A.L.R. 1120.

Civil liability of bank officer or director permitting deposit after insolvency of bank, 87 A.L.R. 1402.

Promises and statements as to future events as fraud, 91 A.L.R. 1295, 125 A.L.R. 879.

Application of principal that false representations made to one person with intention that another may act thereon are actionable in favor of latter, 91 A.L.R. 1363.

Illegal or fraudulent intent of prosecuting witness or person defrauded as defense in prosecution based on false representations, 95 A.L.R. 1249; 128 A.L.R. 1520.

Financial statement by borrower as basis of loan or extension of credit, 104 A.L.R. 921.

Action for fraud or deceit predicated upon oral contract within the statute of frauds or the transaction of which the oral contract was a part, 104 A.L.R. 1420.

Concealment of fact that one of parties to land contract was acting for third person, or misrepresentation as to identity of party for whom he was acting as reason for denying specific performance, or for rescission of contract, 121 A.L.R. 1162.

Fraud predicated upon misrepresentation by grantee or transferee regarding grantor's or transferrer's title, 136 A.L.R. 1299.

What amounts to fraud on contractor, sustaining rescission or action for damages under building or construction contract, 166 A.L.R. 938.

Doctrine of constructive trust or unjust enrichment as applicable between owner and one who fraudulently procures tax certificates, 175 A.L.R. 700.

Real estate broker's right to commission where purchaser refuses to go through with executory contract because of reckless misrepresentation made to him by broker respecting property, 9 A.L.R.2d 504.

Misrepresentation as to loan commitment on real estate as ground of action, counterclaim, or rescission by vendee, 14 A.L.R.2d 1347.

Misrepresentation by one other than insurance agent as to coverage, exclusion, or legal effect of insurance policy, as actionable, 29 A.L.R.2d 213.

Misrepresentation by lessor, in negotiations for lease, as to offers of rental received from third persons, as actionable fraud, 30 A.L.R.2d 923.

Liability of vendor of structure for failure to disclose that it was built on filled ground, 80 A.L.R.2d 1453.

Reasonable expectation of payment as affecting offense under "worthless check" statutes, 9 A.L.R.3d 719.

Employer's misrepresentations as to employee's or agent's future earnings as actionable fraud, 16 A.L.R.3d 1311.

Application of "bad check" statute with respect to postdated checks, 52 A.L.R.3d 464.

Consumer class actions based on fraud or misrepresentation, 53 A.L.R.3d 534.

Promissory estoppel as basis for avoidance of statute of frauds, 56 A.L.R.3d 1037.

Automobile or motorcycle as necessary for infant, 56 A.L.R.3d 1335.

Automobile insurance: concealment or nondisclosure of physical defects or conditions as avoiding coverage, 72 A.L.R.3d 804.

Spouse's acceptance or retention of benefits of other spouse's fraudulent act as ratification of transaction, 82 A.L.R.3d 625.

Fraud predicated on vendor's misrepresentation or concealment of danger or possibility of flooding or other unfavorable water conditions, 90 A.L.R.3d 568.

Action based upon reconveyance, upon promise of reconciliation, of property realized from divorce award or settlement, 99 A.L.R.3d 1248.

Modern status of rules to avoidance of release of personal injury claim on ground of mistake as to nature and extent of injuries, 13 A.L.R.4th 686.

Modern status of rule that crime of false pretenses cannot be predicated upon present intention not to comply with promise or statement as to future act, 19 A.L.R.4th 959.

Cases Citing Georgia Code 23-2-51 From Courtlistener.com

Total Results: 2

Rector of Christ Church v. Bishop of Episcopal Diocese of Georgia, Inc.

Court: Supreme Court of Georgia | Date Filed: 2011-11-21

Citation: 718 S.E.2d 237, 290 Ga. 95, 2011 Fulton County D. Rep. 3631, 2011 Ga. LEXIS 932

Snippet: setting aside a sale or other contract.” • OCGA § 23-2-51 — “(a) Fraud may be actual or constructive, (b)

Byers v. McGuire Properties, Inc.

Court: Supreme Court of Georgia | Date Filed: 2009-05-18

Citation: 679 S.E.2d 1, 285 Ga. 530, 2009 Fulton County D. Rep. 1675, 2009 Ga. LEXIS 243

Snippet: and operates to the injury of another." OCGA § 23-2-51(b). OCGA § 51-6-4 "puts acts of omission, where