then the act of vacating is a proper subject | instituting his proceeding, was not a proper of judicial investigation. Field v. Barling, Field v. Barling, matter to go before the jury, or in any sense 149 Ill. 556, 37 N. E. 850, 24 L. R. A. 406, 41 pertinent to the real issue for trial.' Am. St. Rep. 311; Smith v. McDowell, 148 Ill. 51, 35 N. E. 141, 22 L. R. A. 393; Riemer's Appeal, 100 Pa. 182, 45 Am. Rep. 373; St. Vincent, etc., Co. v. Troy, 76 N. Y. 108, 32 Am. Rep. 286; Dubach v. Hannibal, etc., Co., 89 Mo. 483, 1 S. W. 86. So in the case at bar, if the vacation of the alley in question was a work of public utility and found to be such by the common council, then the benefit that flowed to appellee Lowenstine by reason of restoring to him the real estate relieved of the easement the public had therein, in the event he paid the benefits assessed, is not pertinent to the real issue, nor is the purpose for which he was to utilize the ground after being vacated relevant. Appellant takes the position that the facts disclose that the alley was vacated for a private purpose; the council being moved to act in the premises by reason of a promise made by appellee Lowenstine that he would, in the event the alley was vacated, erect a large department store upon the ground occupied by the alley and the adjoining lots, and for the further consideration of the payment of the sum of $1,900 to the city by ap-out the ingress and egress of an abutting pellee Lowenstine as benefits that would inure to him by reason thereof. In City of Gary v. Much, 180 Ind. 26, 101 N. E. 4, cited by appellants, the city vacated a certain street, which was upon the boundary line of the corporation and shut property owner. The abutting property owner was granted injunctive relief, but the case [7] The latter contention, that the city is turned upon the proposition that the city was reaping a benefit in the way of a money con- without jurisdiction to vacate the street, the sideration to be paid by appellee Lowenstine center of which was the boundary line of as instrumental in moving the council to act, the corporation, part of the thoroughfare beis of itself of but little weight. It is not an ing under the control of the board of comirregularity in the proceedings, as the stat-missioners; but this case throws no light upute provides that, where benefits accrue to any property owner by reason of the vacation of a street or alley, benefits shall be assessed to the property so benefited. Sections 8700 to 8709, Burns' R. S. 1914. The sections of the statute thus referred to relate to powers conferred upon the boards of public works in cities of the first, second, third, and fourth class; but under section 8959, Burns' R. S. 1914, are made applicable to cities of the fifth class. Fry v. Seely, 55 Ind. App. 670, 104 N. E. 774. [8] The subject-matter in controversy be ing within the scope of the authority of the common council and coming within its express grant of power, the court cannot initiate an inquiry into the motive of the legislative department of the city of Valparaiso in this behalf. Cloverdale v. Edwards, 155 Ind. 374, 58 N. E. 495; Lilly v. City of Indianapolis, 149 Ind. 648, 49 N. E. 887; City of Indianapolis v. Maag, 57 Ind. App. 493, 107 N. E. 529; Richland School Tp. v. Overmyer, 164 Ind. 382, 73 N. E. 811. This court held in City of Indianapolis v. Maag, supra, that: "The motives which prompted the action of the board of public works" in vacating the street could not be made the subject of judicial investigation; "but the end to be attained by such proceedings, and the effect thereof, may always be inquired into by the courts upon proper application." In Richland School Tp. v. Overmyer, 164 Ind. 382, 73 N. E. 811, in a proceeding to condemn land for school purposes, it was said: on the question here presented, for in the case at bar the question of want of power or jurisdiction is not involved, but only whether the council exceeded its power. [9] Much of the matter embodied in the special finding of facts was brought to the court by evidence extraneous to the record of a court of equity can travel beyond the face the vacation proceedings, and as to whether of the record and institute an inquiry into the proceedings. when there is no question presented as to the jurisdiction of the common council to act, the authorities lack much of being in harmony; but out of the vast number of adjudicated cases may be adduced a rule, which seems to be in consonance with the better reasoning, and that is that, in the absence of fraud, where the municipality had jurisdiction to act, there can be no judicial inquiry by the court, but, where the proceedings are infected with fraud, the inquiry may proceed beyond the face of the record itself. [10, 11] There is no contention that the common council acted corruptly, or intentionally committed a wrong. Further, the action taken by the common council has in its favor the presumption that it acted in good faith in the performance of its duty and according to law. Robling v. Board of Com., 141 Ind. 522, 40 N. E. 1079; Town of Cicero v. Lake Erie, etc., Co., 52 Ind. App. 298, 97 N. E. 389. Fraud, however, may exist without any intention to "do a wrong," as the law itself may under certain conditions declare a thing to be fraudulent without a real intention to commit fraud having been found. This is known as constructive "The fact, if it be true, that the township trustee would be directly or indirectly benefited in his private business, beyond the general benefits resulting to the public from the appropriation, or that he was, to an extent, influenced or fraud, or fraud in law, and may consist of biased or prejudiced for or against appellee in any breach of duty which, if not relieved (68 Ind. App. 61) against, would operate as a fraud. 16 Cyc. | ful consideration of the various questions 87; Alsmeier v. Adams, supra. presented by the learned and exhaustive [12] A radical departure in the transac-briefs, we find no error that calls for a retion of public business by a public officer versal of the judgment. from the usual and lawful method of trans- Judgment affirmed. acting the same, or a palpable disregard of an official duty, might operate as a fraud in law, although there was no intention to do a wrong. But a grievance based upon fraud, whether actual or constructive, to be actionable, must work an injury in some manner to the complaining party, as this is an essential ingredient to the cause of action. 16 Cyc. p. 88; Smith on the Law of Frauds; p. 3. BRIGHT NAT. BANK v. HANSON.* (No. 9022.) (Appellate Court of Indiana, Division No. 1. June 9, 1916.) 1. BILLS AND NOTES 477 PLEADING An answer, alleging that plaintiff, holder of the notes sued upon, united with the payee, an administratrix, in fraudulently inducing defendant to execute them, states a defense irrespective of whether the estate was bound by the administratrix's false representations. Notes, Cent. Dig. §§ 1524, 1525, 1558; Dec. Dig. [Ed. Note.-For other cases, see Bills and 477.1 ACTIONS 2. BILLS AND NOTES 497(2) 3. EXECUTORS AND ADMINISTRATORS 116 [13] Do the facts found force the conclusion that the vacation of the alley under the circumstances amounted to a constructive fraud? The closing up of a public way in the heart of the city and turning the same back to the owner of the fee, freed from the public easement, called for due and careful consideration on the part of the common council of the city of Valparaiso, and in this behalf they have supporting their action the presumption of good faith. It is true that the petition filed with the common council and heretofore set out discloses that the appellee Lowenstine was personally interested in having the alley vacated, and that the information that he intended to build a large department store, in the event the alley was vacated, was before the common council when they acted upon the petition; but, when the special finding of facts is stripped of the evidentiary facts thrust into the same, there is not enough to warrant the conclusion that the alley was vacated for a private purpose, nor that the common council acted beyond its scope of duty and exceeded its discretionary power, nor that its acts amounted to constructive fraud. In Rensselaer v. Leo- 4. pold, 106 Ind. 29, 5 N. E. 761, the court held: "It is said, however, that narrowing the street, whereby a strip 52 feet in width off one side is abandoned to the adjoining property owners, is not a public use; that this is nothing more than an indirect method of transferring part of the public street to private use. While it is true courts cannot be precluded from an inquiry into the character of the use for which property is proposed to be condemned, yet the presumption is in favor of the public character of a use which is declared to be public by the Legislature. Unless it is apparent at first blush that the proposed use is not public, courts cannot interfere with the discretion confided to a municipal body, in doing that which the statute expressly authorizes." If appellants suffered any special injury, it must be inferred from the facts found, as there is no positive finding in this respect. As to whether appellants, whose properties do not abut upon that part of the alley vacated, had such an interest as taxpayers to maintain the suit, which it is earnestly contended by appellees that they did not, we need not decide, as the conclusion reached on the other branch of the case does not call for a decision of this question. After a care The court gave an administratrix broad powers to carry on deceased's business, and she those powers, obtained and turned over to the fraudulently, but within the apparent scope of estate certain notes. Held, that her fraud was chargeable to the estate. [Ed. Note. For other cases, see Executors and Administrators, Cent. Dig. § 484; Dec. Dig. 116.] SALES 124-RESCISSION BY BUYER-RESTORATION OF CONSIDERATION. A defrauded buyer need not allege and prove an offer to return the goods when they are worthless. Dig. 88-303-312; Dec. Dig. 124.] 1051(2)-HARMLESS ERROR-FACT OTHERWISE ESTABLISHED. Allowing an agent to testify as to the agency relationship is harmless error, where there was other uncontradicted testimony establishing the fact. Error, Cent. Dig. § 4163; Dec. Dig. 1051(2).] [Ed. Note.-For other cases, see Appeal and 6. SALES 354(8)-ACTION FOR PRICE-AN SWER. the purchase price of personal property, held to The answer, in an action on notes given for plead a rescission of the contract because of fraud and not to stand upon the contract and claim, damages. [Ed. Note.-For other cases, see Sales, Cent. Dig. § 1022; Dec. Dig. 354(8).] 7. SALES 404 - ACTION FOR PRICE-DE FENSES. A defrauded buyer may either rescind the received under it, or may stand upon the concontract and offer to return anything of value tract and recover as damages the difference be For other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes tween the value of the property received and its the paragraph of complaint based thereon. value if it had been as represented. Such note is as follows: [Ed. Note.-For other cases, see Sales, Cent. "$600.00. Dig. § 1146; Dec. Dig. 404.] 8. SALES 347(2) - ACTION FOR PRICE-DEFENSE TO NOTE GIVEN FOR PRICE. A defrauded buyer, who gave notes for the purchase price, may set up the same defenses in an action by the seller on the notes as he could in a direct action for the purchase price. [Ed. Note.-For other cases, see Sales, Cent. Dig. § 964; Dec. Dig. 347(2).] 9. SALES 355(4)—ACTION FOR PRICE-VARIANCE. Where a buyer's answer claims a rescission of the contract for fraud, he should be confined to that theory, and not allowed to claim damages for the difference between the value of the property received and its value if it had been as represented. [Ed. Note. For other cases, see Sales, Cent. Dig. §§ 1037-1043; Dec. Dig. 355(4).] 10. APPEAL AND ERROR 1068(5) INSTRUCT. HARMLESS ERROR-CURE BY VERDICT-REFUSAL TO Where a defendant buyer claimed a rescission of a sales contract because of fraud, a refusal to instruct that he must offer to restore everything of value received under the contract is harmless error, where the jury, by a verdict for the defendant, necessarily found that the property was worthless. [Ed. Note. For other cases, see Appeal and Error, Cent. Dig. § 4230; Dec. Dig. Trial, Cent. Dig. 88 475, 553, 558.] 1068(5); 11. APPEAL AND ERROR 1068(4)—HARMLESS ERROR-CURE BY VERDICT. "Town La Otto, State Ind., Sep. 29, 1911. "On the first day of March, 1912, after date we, or either of us promise to pay to the order of the Medical Chemical Company South Omaha, Nebraska, six hundred 00/100 dollars, payable Garrett Banking Co., value received, without discount or offset, waiving our rights to all exemptions allowed us by law, with interest at 6 per cent. from date, if not paid when due or when presented. "County of Noble. Edward M. Hanson. "Witness: "Dr. W. F. Larimer. 38234 26122." Said paragraph of complaint alleges, in brief: That appellant is a corporation; that appellee executed the note to the payee, the Medical Chemical Company. That when due it was presented for payment at the place named therein, viz., Garrett Banking Company of Garrett, Ind. That payment thereof was refused; that such note is past due and unpaid. That on September 29, 1911, Minnie Doty was administratrix of the estate of William M. Doty, deceased, and as such, by order of the Delaware circuit court, in carrying on the business of decedent took and receiv ed said note from appellee by the style of the "Medical Chemical Company" (hereinafter referred to and designated as the "M. C. Co."). That such company existed in name only, which name was adopted by the administratrix as a trade-name, the same having been used by the deceased in his lifetime. That such estate was the actual original payee of said note and the real owner thereof, the Where defendant buyer claimed a rescission of a sales contract because of fraud, an instruction, that plaintiff's recovery might be decreased by the difference between the value of the prop-name "M. C. Co." being placed therein as erty received and its value if it had been as represented, was harmless, where the jury by a verdict for defendant necessarily found that the property was worthless. HOTTEL, P. J. This is an action in which appellant, a banking corporation, filed in the trial court three separate paragraphs of complaint, in each of which, respectively, it sought to recover on a note held by it as assignee. The notes sued on are in substance the same, except as to amount and date of maturity, and this difference also distinguishes the several paragraphs of complaint, so that, for the purposes of the questions presented by the appeal, it will be sufficient to indicate the substance of the first note and payee and used as an accommodation to said "By virtue of an order of the Delaware circuit court, of Delaware county, Ind., I as administratrix of the estate of William M. Doty, deceased, hereby sell, assign and transfer the within and foregoing note to Frank Hay, for a valuable consideration, for and on behalf of said estate. M. Doty, Administratrix of the Estate of William M. Doty, Deceased." That at the time of this assignment said estate was the sole and exclusive owner of such note, and by such assignment the absolute and complete ownership of such was passed to said Hay. That thereafter on December 7, 1911, said Hay, for value, by written indorsement, on the back thereof, sold and delivered said note to this plaintiff, which written indorsement is as follows: "Pay to the order of Bright National Bank, without any recourse on me. Frank E. Hay." That appellant is the owner and holder of said note. The other notes are for $500 each. and untrue and made for the purpose of cheating and defrauding appellee and to induce him to execute the notes sued on; and that appellee relied on said statements and representations and believed them to be true and was thereby induced to execute said notes. [1] To this paragraph appellant filed a demurrer for want of facts, which was overruled, and this ruling is assigned as error. Several objections are stated in the memorandum accompanying such demurrer, but the only objection to the sufficiency of such paragraph urged in appellant's brief is that it proceeds on the theory of fraud, and that an administratrix, under the law of this state, cannot be charged with fraud or fraudulent representations in making sale of personal property of the estate, upon which she is administering; that whatever misrepresentations may have been made by said administratrix in the sale of said powders, if any, was a personal wrong, by which said estate could not be bound. While this paragraph of answer contains averments, some of which we have not set out, supra, which might indicate a different theory, we think, when considered in its entirety, its theory is as stated by appellant. However, as affecting the question presented by appellant's objection, supra, the legal proposition stated therein, if correct, would not be of controlling importance, because the facts stated in the italicized portion of said answer, supra, charge that appellant was a party to the fraud perpetrated on appellee, and hence makes the answer sufficient to avoid appellant's objections, even though its assignor, the estate of said administratrix, may not have been bound by the representations made by the agent of such administra graphs, the first of which was a denial. The | Larimer and of said M. C. Co. were false second amended paragraph alleged that on September 29, 1911, appellee entered into an agreement with the M. C. Co. to purchase 20,000 pounds of stock food, claimed to be manufactured by such company and known as "Protection Stock Powder"; that in truth and in fact there was no M. C. Co., but appellee did not know this until long after said contract was made and said notes executed; that said name had been adopted by William Doty for the express purpose of deceiving and defrauding persons with whom he dealt; that Dr. W. F. Larimer was the agent of such company and entered into the contract with appellee for and on behalf of the so-called company. Here follows averments as to representations made by said Larimer with reference to the things to be done and furnished by said company and the many ailments of animals for which such powders were a remedy or cure, including also a representation that such company was a corporation financially responsible for all its contracts and that such powders would be fresh and in good condition and would meet all the representations made by said M. C. Co. The answer then avers that, for said stock powder and the other enumerated things to be done and performed by said M. C. Co., appellee executed the notes sued on, and then proceeds in substance as follows: At the time of making said representations, Larimer knew that the powders sold to this appellee had been sold to one Frank E. Hay, and that notes were held by appellant and payment thereof had been refused by Hay; that appellant knew of all the representations made by said Larimer, and knew that the purpose was to deceive appellee, and having purchased of said M. C. Co., or the said William Doty or his representatives, said powders, the notes of the said Hay were to be re-trix. turned to him and the notes of appellee taken The ruling on the demurrer to the third in their place; that appellant accepted said notes from Hay and had him indorse the same "without recourse" to it, all without the knowledge of appellee; that appellant, through its officers, was a party to the fraud practiced upon appellee, and knew at the The fourth and fifth paragraphs of antime of making the said contracts that the swer each aver that the notes in suit were powders which were furnished appellee were given without any consideration; the differof no value at all, and that said notes were ence between them being that the fourth being executed without any consideration paragraph contains an averment not found in whatever passing to appellee; that when such the fifth paragraph, to the effect that appelpowders are manufactured they are in pow-lant knew when it purchased such notes that der form, and it is intended that they shall their execution had been fraudulently probe sold and used when in that form; that cured, and that they were given without conafter a time they will become solid and hard, sideration. A demurrer to each of these unfit for use, and of no value; that the pow-paragraphs was overruled, and each of such ders sold to appellee soon after delivery be- rulings is assigned as error; but neither is came hard and solid and were of no value; mentioned or referred to in appellant's points that Larimer, acting for said company, rep- and authorities, and is therefore waived. resented to appellee that said powders would not become hardened and solidified and were fresh and direct from the company, all of which was false and untrue; that all the said representations and statements of the said paragraph of answer is also assigned as error; but, as the question presented thereby is substantially the same as that presented by said objection to the second paragraph, it need not be further considered. A reply to each of said paragraphs of answer was filed, in which it is averred that Minnie Doty was the administratrix of the estate of William M. Doty, deceased, appointed by the Delaware circuit court prior to the time of the execution of the notes sued | be invoked as a defense to their collection. on; that notice of her appointment had been made by publication in a weekly newspaper; that she was acting under an order of the court, and under such order, and not otherwise, sold to this appellee the stock powder for which he executed his notes; that all of said facts were known by appellee when he purchased such powders and executed the notes in suit in payment thereof. A demurrer to this reply was sustained, and this ruling is assigned as error and urged as ground for reversal. Appellant suggests no reason in support of his contention that is not in effect disposed of by our disposition of the ruling on the demurrer to the amended second paragraph of answer. A seventh paragraph of answer was filed by appellee, which is not essentially different from the amended second or third paragraphs, except that it goes more into detail in the averments charging fraudulent representations made by Larimer, the agent of the administratrix, and omits omits all averments charging knowledge of and participation in such fraud on the part of appellant. It also expressly charges that the powders for which such notes were given were of no value, but does not charge that appellant knew such fact when it purchased said notes. [2, 3] A demurrer to this answer was also overruled, and such ruling is urged as ground for reversal. The objections, supra, made to the amended second and third paragraphs of answer, are repeated and urged against this paragraph. As this paragraph does not charge appellant with knowledge of or par ticipation. in the fraud charged in the sale of said powders, the question presented is essentially and materially different from that presented by such other rulings. The theory of this answer is that the "payee named in the note, the M. C. Co., was a fictitious company used by the administratrix of said estate, the true payee, and that the execution of the notes was induced by the fraudulent representations of Larimer as agent of such administratrix, and, if the averments of such answer are in fact sufficient to show that the execution of such notes was fraudulently procured, the averments charging appellant with knowledge of, or connection with, such fraud, knowledge of, or connection with, such fraud, were not essential to its sufficiency, because it has been uniformly held in this state that: "While the common-law rule protecting a bona fide holder prevails, yet in order to receive its protection it devolves upon the plaintiff to show that he became a holder before maturity, without notice, and for a valuable consideration, whenever the defendant makes it appear that the note was obtained by fraud." First Nat. Bank v. Ruhl, 122 Ind. 279, 23 N. E. 766; Zink v. Dick, 1 Ind. App. 269, 273, 274, 27 N. E. 622; Shirk v. Neible, 156 Ind. 66, 72, 59 N. E. 281, 83 Am. St. Rep. 150, and cases cited. We must therefore determine whether the false representations alleged to have been made by the agent of said administratrix in As herein before indicated, appellant insists that any fraud or fraudulent representations made by such administratrix or her agent would be a tort and a personal wrong by which her said estate could not be bound. It is no doubt true, as appellant contends, that generally speaking an estate will not be rendered liable for any damages resulting from any false statements, representations, or warranties made by the administrator. Riley v. Kepler, 94 Ind. 308; Huffman v. Hendry, 9 Ind. App. 324, 36 N. E. 727, 53 Am. St. Rep. 351, and cases cited. This is so because an administrator as such has no authority to make such statements, representations, or warranties for or on behalf of his estate, and hence, if liable at all, he is individually liable. However, we do not believe that this principle should be applied to a case where the administrator by the order of the court was authorized to carry on the business of his deceased, and where in so carrying on such business he fraudulently obtains and retains for such estate an unconscionable advantage and benefit. It appears from appellant's reply and from the evidence that this administratrix procured an order of the Delaware circuit court by which she was authorized as administratrix of said estate to carry on the business of her deceased husband in the name and style of the M. C. Co. The petition on which this order is based and the order itself are very broad and comprehensive. They give the administratrix full and general power and authority to "continue and carry on the busi ness of her deceased husband in the name and style of the Medical Chemical Compastock foods, medicines, and powder for the ny," which business "consisted in the sale of use of horses and other stock." She was givher deceased husband, to employ persons to en authority to carry out the contracts of assist her therein, and to sell such notes held by her as administratrix as might be necessary in the carrying on and continuing of said business. In other words, the order, in into the shoes of her deceased husband and effect, permitted the administratrix to step continue and carry on his business for the benefit of his estate and employ agents to benefit of his estate and employ agents to assist her therein. The acts of such admin istratrix in the matter were therefore akin to the acts of an agent in the estate of her deceased husband, rather than the acts of an administratrix proper of his estate. The representations therefore of said Larimer, who was the husband's agent, and who con. tinued as the agent of the administratrix, were at least within the apparent scope of the authority given by such order. We do not mean to say that such order authorized said administratrix or her agent to make false representations; but the order allowed such administratrix to select and pursue her |