to be necessary to prove a bad motive on the part of the defendant, but to show that he understood the position of the plaintiff as a person likely to be misled. It is in that way only that intention is an element in the breach of duty. Proof of malice will serve the purpose, but is not required'. All that is required on this point is that the defendant should have intended, or should reasonably be supposed to have intended, that the plaintiff should act upon the representation.

Representa

tion must be

§ 6. ACTING UPON THE REPRESENTATION

It is fundamental that the defendant's representation should have been acted upon by the plaintiff, and acted upon to his injury, to enable him to maintain an action for the alleged breach of duty. Indeed, fraudulent conduct or dishonesty of purpose, however explicit, will not afford a cause of action unless shown to be the very ground upon which the plaintiff acted to his damage.

acted upon to plaintiff's damage.

So strong is the rule upon this subject that it is deemed necessary to this action that the damage as well as the acting upon the representation must already have been suffered before the bringing of the suit, and that it is not sufficient that it may occur. For example: The defendant induces the plaintiff to indorse a promissory note before its maturity by means of false and fraudulent representations. An action therefor cannot be maintained before the plaintiff has been compelled pay the note3.

to

Indeed, a person who has been prevented from effecting an attachment upon property by the fraudulent representations Preventing of the owner or of his agent is deemed in America attachments. to have suffered no legal damage thereby, though subsequently another creditor attach the whole property of the debtor and sell it upon execution to satisfy his own debt*.

1 Foster v. Charles, 6 Bing. 396; s. c. 7 Bing. 105.

2 Pasley v. Freeman, 3 T. R. 51; Smith v. Chadwick, 9 App. Cas. 187; Freeman v. Venner, 120 Mass. 424.

3 Freeman v. Venner, 120 Mass. 424.

4 Bradley v. Fuller, 118 Mass. 239. But see Kelsey v. Murphy, 26 Penn. St. 78.

The person thus deceived, having acquired no lien upon or right in the property, cannot lose any by reason of the deceit. The most that can be said of such a case, it has been observed, is that the party intended to attach the property, and that this intention has been frustrated1; and it could not be certainly known that that intention would have been carried out2. If the attachment had been already levied and was then lost through the deceit, the rule would of course be different3.

Who may act on the representation.

It must appear moreover that the plaintiff was entitled to act upon the representation; a fact to be shown by the intention, or the reasonably presumed intention, of the defendant. The representation may have been intended for (1) one particular individual only (in which case he alone is entitled to act upon it), or (2) it may have been intended for any one of a class, or (3) for any one of the public, or (4) it may have been made to one person to be communicated by him to another. Any one so intended, who has acted upon the misrepresentation to his damage, will be entitled to redress for any damage sustained by acting upon the representation". For example: The defendants put forth a prospectus to the public, containing false representations, for the purpose of selling shares of stock in their company. The plaintiff, as one of the public, may show that he acted upon the representations, and, having bought stock accordingly, recover damages for the loss sustained thereby 5.

1 Bradley v. Fuller, 118 Mass. 239.

2 Bradley v. Fuller, supra.

3 Id.

4 Richardson v. Silvester, L. R. 9 Q. B. 34; Swift v. Winterbotham, L. R. 8 Q. B. 244; Peek v. Gurney, Law R. 6 H. L. 377.

5 Andrews v. Mockford, 1896, 1 Q. B. 372, distinguishing Peek v. Gurney, L. R. 6 H. L. 377.

§ 7. KINDRED WRONGS: QUASI-DECEIT: UNFAIR

COMPETITION

We come now to certain kindred wrongs, which may be called cases of quasi-deceit. These vary somewhat in legal aspect from deceit proper as presented in the foregoing pages, and yet they have enough in common with that subject to be treated as kindred to it. The subjects referred to are (1) the simulation of another's trade name' or business sign, and (2) disparaging statements of another's property, otherwise called Slander of Title. But Slander of Title introduces malice, and is a distinct tort; it will accordingly have a separate chapter.

Fraudulent use of trade name or business sign.

A trademark proper is a mark or device, registered under statute, to identify a man's goods offered for sale or not. The owner of a valid statutory trademark has property in the same, with right of protection accordingly; his right accordingly does not turn upon the practice of fraud, or anything in the nature of fraud, and hence is not a subject for consideration here1. By 'trade name' is meant a name, mark, or device not registered according to statute and not a subject of property in the plaintiff. No action therefore can be based upon any infringement of a property right; there must be simulation, together with deception, practised by the defendant on the public against the plaintiff. The wrong is often called 'unfair competition.' The trade name or mark may be one already in use and known to the trade as the name or mark of a particular person, or it may be new.

In order to sustain an action for damages for alleged wrongful use of a trade name, the plaintiff must show (1) that the trade name used by the defendant so resembled that of the plaintiff as to be likely to deceive the ordinary buyer, (2) that the defendant knew of the existence of the plaintiff's mark when he committed the alleged wrong, (3) that he intended to palm off

What must be proved in the case of a trade name.

1 See post, chap. xii, § 2.

2 See Reddaway v. Banham, 1896, A. C. 199; Ratcliffe v. Evans, 1892, 2 Q. B. 524, 528, as to damage.

the goods as the goods of the plaintiff, and (4) that the public were deceived thereby to the plaintiff's hurt1. For example: The defendant sells a medicine labelled 'Dr Johnson's ointment'; the label being one which the plaintiff had previously used, and was still using when the defendant began to make use of the same. The plaintiff cannot recover without showing that the defendant has used the label for the purpose of indicating that the medicine has been prepared by the plaintiff. Again: The plaintiff Sykes is a maker of powder-flasks and shot-belts, upon which he has placed the words 'Sykes Patent.' There is no valid patent upon them, in fact, as has been decided by the courts; but the maker has continued to use the words upon the goods to designate them as of his own making. The defendant, whose name is also Sykes, makes similar goods, and puts upon them the same words, with a stamp closely resembling that of the plaintiff, and then sells the goods 'as and for' the plaintiff's goods. This is a breach of duty3.

If the case be one of alleged wrongful conduct in the use of a business sign or badge likely to deceive, the proof

Wrongful

use of business sign.

required will be the same, except that, instead of the 'palming off' under head (3), the plaintiff, to recover damages, must show that the defendant intended to represent that the business which he was carrying on was the plaintiff's business, or business in which the plaintiff had some special interest. For example: The defendant has the words' Revere House' painted upon coaches which he uses to carry passengers from the railroad station to a hotel of the name. By contract with the proprietor of the hotel the plaintiff has the exclusive right to represent that he has the

1 Sykes v. Sykes, 3 B. & C. 541; Rodgers v. Nowill, 5 C. B. 109; Morison v. Salmon, 2 Man. & G. 385; Crawshay v. Thompson, 4 Man. & G. 357, 379, 383. In a proceeding for injunction it is not necessary, even in these cases of quasi-trademark, to prove the defendant's knowledge or intent to deceive. Simple priority of use of the mark is enough. See Millington v. Fox, 3 Mylne & C. 338; Singer Machine Co. v. Wilson, 3 App. Cas. 376; Reddaway v. Bentham Hemp-Spinning Co., 1892, 2 Q. B. 639, 644, 646. The subject of trademarks is being assimilated to the law of property, as trademarks proper are taking the place of mere trade names; and actions for deceit are becoming infrequent, though still available.

2 Singleton v. Bolton, 3 Doug. 293. This supposes, of course, that the medicine was not patented.

3 Sykes v. Sykes, supra.

patronage of the hotel. The defendant commits no breach of duty to the plaintiff, unless he so makes use of the designation as to indicate that the proprietor of the hotel has granted to him what has been granted to the plaintiff alone1.

1 Marsh v. Billings, 7 Cushing (Mass.), 322. When an injunction merely is asked for by one who has lawfully had use of an unregistered name or mark, known to the trade, it is not necessary, any more than it is of the case of a legal, registered trademark, for such one to prove an intent on the part of the defendant to palm off his goods as the goods of the plaintiff; enough that the name or mark adopted by the defendant, from resembling that of the plaintiff, will be likely to deceive the ordinary buyer. Or to put it in language quoted and approved by the Circuit Court of Appeals of the United States: 'When such a mark, name, or phrase has been so used by a person in connection with his business or articles of merchandise as to become identified therewith and indicate to the public that such articles emanate from him, the law will prohibit others from so using it as to lead purchasers to believe that the articles they sell are his, or as to obtain the benefit of the market he has built up thereunder.' Fuller v. Huff, 104 Fed. Reporter, 141, 143.

The same name or mark, so in use, may indeed be used by others, if it be not a true trademark of the statute; but in that case there must be a plain designation that the name or mark is that of the person using it, and not that of the plaintiff. Powell v. Birmingham Vinegar Co., 1894, 3 Ch. 449, 461; affirmed, 1897, A. C. 710.