EDGINGTON V. FITZMAURICE
29 Ch. 459 (1885)
NATURE OF THE CASE: This was an action in fraud.
FACTS: P advanced 1500 pounds for debentures of a society of which Ds were the directors
and officers. To raise the funds, Ds circulated a prospectus that announced that they had
acquired a valuable property subject to a half yearly payment of 500 pounds in redemption of
a mortgage of 21,500 pounds. They also stated that they would use moneys to complete
alterations and additions to the buildings and purchase their own horses and vans and to
further develop an exist for the direct supply of cheap fish. Those statements were
impeached as the prospectus was framed to lead a person to believe that the debentures would
be a charge on the property of the company; it failed to mention a second mortgage on the
property, it failed to state that the entire 21,500-pound mortgage was due in full on April
of 1884, and that the real object of the debentures was to pay off present company
liabilities and that the company could not complete its planned purchases of equipment as
advertised. The verdict went to P and Ds appealed.
ISSUE:
RULE OF LAW:
HOLDING AND DECISION:
LEGAL ANALYSIS:
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