Canada Judgment

Supreme Court of Canada

Macfarlane v. Davis

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01

Holding and result

The appeal was allowed because the Court held that deceit requires proof of dishonest knowledge or recklessness as to falsity and that an honest belief in the truth of a representation defeats liability for deceit; further, amendments introducing new causes of action are not to be allowed where they produce unfair prejudice inconsistent with the pleaded issues.

Court disposition

Appeal allowed with costs; judgment of the Supreme Court of Saskatchewan reversed.

Orders

  • Appeal allowed with costs
  • Judgment of the Supreme Court of Saskatchewan reversed
  • Costs awarded to appellant

02

Material facts

Parties

Macfarlane

Appellant/defendant Counsel: Holman K.C.; A. J. Kidd

Davis

Respondent/plaintiff Counsel: Chrysler K.C.

03

Procedural history

  1. Posture

    Civil Appeal (sale of Land, Tort of Deceit) / Appeal to Supreme Court of Canada From Supreme Court of Saskatchewan; Judgment on Appeal Allowed With Costs

04

Questions and positions

Legal issues

Party arguments

Applicant
Appellant argued that there was no actionable deceit because he honestly believed the representations he made and therefore lacked fraudulent intent; he also contested the allowance of an amendment that effectively introduced a new cause of action.
Respondent
Respondent maintained that misrepresentations were made and that deceit was established irrespective of asserted belief; respondent defended the amendment and relied on the Saskatchewan court's validation of the claim.

05

Court’s reasoning

  1. 01

    Supreme Court of Canada, Macfarlane v. Davis (1910) 47 SCR 399

    To establish actionable deceit the plaintiff must prove that the defendant knew a representation was false or was reckless as to its truth; an honest belief in the truth of the representation negates fraudulent intent.

  2. 02

    Supreme Court of Canada, Macfarlane v. Davis (1910) 47 SCR 399

    Courts will scrutinize amendments that introduce new causes of action and will not permit amendments that unfairly prejudice the opposing party or are inconsistent with the issues pleaded and tried.

06

Ratio, limits and disposition

Ratio decidendi

The appeal was allowed because the Court held that deceit requires proof of dishonest knowledge or recklessness as to falsity and that an honest belief in the truth of a representation defeats liability for deceit; further, amendments introducing new causes of action are not to be allowed where they produce unfair prejudice inconsistent with the pleaded issues.

Obiter and limits

  • Pleadings must be interpreted in light of the issues actually raised at trial and not expanded by late amendments to the prejudice of the other party.
  • Finding of liability for deceit cannot rest on mere misstatement absent proof of fraudulent intent or recklessness.

Court disposition

Appeal allowed with costs; judgment of the Supreme Court of Saskatchewan reversed.

  • Appeal allowed with costs
  • Judgment of the Supreme Court of Saskatchewan reversed
  • Costs awarded to appellant

Source and reliance status

Supreme Court of Canada · 9 December 1910

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Judgment text

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Source document

Supreme Court of Canada

Judgment· 9 December 1910

(1910) 47 SCR 399

Macfarlane v. Davis Collection Supreme Court Judgments Date 1910-12-09 Report (1910) 47 SCR 399 Judges Fitzpatrick, Charles; Girouard, Désiré; Davies, Louis Henry; Idington, John; Anglin, Francis Alexander On appeal from Saskatchewan Subjects Sale Decision Content Supreme Court of Canada Macfarlane v. Davis, [1910] S.C.R. 399 Date: 1910-12-09 Macfarlane v. Davis. 1910: October 21; 1910: December 9. Present: Sir Charles Fitzpatrick C.J. and Girouard, Davies, Idington and Anglin JJ. ON APPEAL FROM THE SUPREME COURT OF SASKATCHEWAN. Sale of land—Deceit—Misrepresentation—Honest belief—Pleading— Amendment—Adding new cause of action. APPEAL from the judgment of the Supreme Court of Saskatchewan[1], reversing the judgment of Johnstone J., at the trial, Newlands J. dissenting, and maintaining the plaintiff's (respondent's) action with costs. On the appeal of Macfarlane, one of the defendants, to the Supreme Court of Canada, after hearing counsel on behalf of both parties, the court reserved judgment, and, on a subsequent day, the appeal was allowed with costs, Idington J. dissenting. Appeal allowed with costs. Holman K.C. and A. J. Kidd for the appellant. Chrysler K.C. for the respondent. [1] 3 Sask. L.R. 446, sub nom. Davis v. Burt.

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Authorities

Authorities used by the court

Cases, legislation, regulations, and constitutional provisions identified in the available record.

Davis v. Burt, 3 Sask. L.R. 446

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