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certificate, it must respond to the in

jured party.

This case was followed in Denton v. Nashville Title Co. (Tenn.) supra, which held that an abstract company making a certificate of title for the owner of property, and knowing that it was to be used in making a sale, was liable for any material defect causing injury to the immediate purchaser, to whom the abstract was issued.

But Equitable Bldg. & L. Asso. v. Bank of Commerce & T. Co. (1907) 118 Tenn. 678, 12 L.R.A. (N.S.) 449, 102 S. W. 901, 12 Ann. Cas. 407, held that, as an abstracter is liable for his errors only where a privity of contract exists, he cannot be made to answer to one to whom an abstract was presented by the property owner, and who loaned money in reliance thereon, without any notice to the abstracter of the intended use of the instrument. The court distinguished the Dickle Case and the Denton Case, supra, as holding that under special circumstances appearing therein a privity existed, as in those cases the officers of the abstract company knew for what purpose the abstract was being obtained.

Where it was shown that an arrangement existed between a loan association and an abstract company, by which applicants for loans were required to furnish abstracts to the loan association, prepared by the abstract company, which were paid for by the applicants, the court in Western Loan & Sav. Co. v. Silver Bow Abstract Co. (1904) 31 Mont. 448, 107 Am. St. Rep. 435, 78 Pac. 774, held that not only a privity of contract was established, but that an actual contract existed between the abstract company and the loan association, as the abstract company knew that the abstract was for the exclusive benefit and use of the association, and that it would rely thereon.

And so an action on the contract may be maintained by the lender against an abstract company, where in order to procure the loan the property owner had applied to the abstract

company to make a search of the title, making known his agreement with the plaintiff, and the company agreed to make and deliver a search and certificate to the property owner, to be by him delivered to the plaintiff and used for the purpose of obtaining the loan. Economy Bldg. & L. Asso. v. West Jersey Title Guarantee Co. (1899) 64 N. J. L. 27, 44 Atl. 854. The court stated that the contention of the defendant that no privity existed between it and the plaintiff required too narrow a view of the transaction, but that, upon the averments of the complaint, there was disclosed either a contract between the plaintiff and the defendant, made through the agency of the property owner, for the examination and certification of the title, or a contract of like employment between the property owner and the defendant, for the benefit of the plaintiff.

And so a recorder is liable for the acts of his clerk in issuing a certificate of search, from which he omitted a mortgage of record at the request of the property owner, who assured him the mortgage was to be paid with money which he was to procure from a loan then in negotiation, where the clerk knew that the plaintiff was about to loan money on the faith of the certificate. Peabody Bldg. & L. Asso. v. Houseman (1879) 89 Pa. 261, 33 Am. Rep. 757.

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And so in Decatur Land, Loan & Abstract Co. v. Rutland (1916) Tex. Civ. App. 185 S. W. 1064, it was held that a finding that an abstract company which had prepared an abstract for the seller of real property reaffirmed and rectified the abstract at the instance of the purchaser, and was informed that he contemplated the purchase of the land. and would rely on the title as shown in the abstract, was sufficient to impose a liability in favor of the purchaser for its negligence in making the abstract.

And the court in Anderson v. Spriesterbach (1912) 69 Wash. 393, 42 L.R.A. (N.S.) 176, 125 Pac. 166, stated that it was inferentially held in National Sav. Bank v. Ward (U. S.) su

pra, that, had the abstracter had "any knowledge as to the purposes for which the abstract was obtained," he would have been liable to one acting upon his credit. But see Gordon v. Livingston (Mo.) infra, II. c.

In Thomas v. Guarantee Title & T. Co. (1910) 81 Ohio St. 432, 26 L.R.A. (N.S.) 1210, 91 N. E. 182, 2 N. C. C. A. 80, the court, after stating that it could find no exception to the general rule that an action against an abstracter for damages in making or certifying an abstract of title sound in contract, and that he could be liable only to the person employed by him, criticizes Brown v. Sims (1899) 22 Ind. App. 317, 72 Am. St. Rep. 308, 53 N. E. 779; Denton v. Nashville Title Co. (1903) 112 Tenn. 320, 79 S. W. 99, and Economy Bldg. & L. Asso. v. West Jersey Title Guarantee Co. (1899) 64 N. J. L. 27, 44 Atl. 854, supra, as being exceptional cases, in which the court sought to mitigate the rigor of that rule by straining the doctrine of privity of contract.

And so an abstracter, who, at the request of the property owner, makes and certifies abstracts of the title of land, which he delivers to the plaintiff, who makes a loan to the owner, is liable to the plaintiff for negligence in making the abstract. Brown v.

Sims (1899) 22 Ind. App. 317, 72 Am. St. Rep. 308, 53 N. E. 779. The court states: "We think it cannot properly be said that the appellee did not owe a duty to the appellant arising under the contract, the attending circumstances indicating that it was the understanding of all the parties that the service was to be rendered for the use and benefit of the appellant, the particular person who was to loan his money in reliance upon what the abstracter should do and represent in the premises. If such a duty did arise, the appellee was bound to the person to whom he owed the duty, to perform it with reasonable care and skill. However broad and inclusive the statements of the general doctrine in the decided cases, we think that when the facts involved and the reasons stated in the opinions, to some of which we have referred, are

considered, it must be concluded that the view we take of the pleading before us is sustained by the authorities."

3. Effect of statutes.

In some states statutes have been enacted governing the liability of title abstracters for errors in making abstracts, which in general terms impose a liability for damage proximately caused to any person by such errors. Such statutes have been held to impose a liability for damage caused to a third person relying upon an incorrect abstract. Thus, under the South Dakota Code provision that abstracters are liable for any and all damages that may occur to any party or parties by reason of any error, deficiency, or mistake in the abstract of certificate of title made or issued by the abstracter, an abstracter is liable to the person injured, without regard to who pays for it or by whom it was ordered, the court stating that the intention of the legislature was to include within the protection of this statute any person suffering damage by reason of the neglect or omission of an abstracter. Goldberg v. Sisseton Loan & Title Co. (1909) 24 S. D. 49, 140 Am. St. Rep. 775, 123 N. W. 266.

And in Oklahoma, under a statutory provision requiring an abstracter to execute a bond conditioned that he will properly demean himself in the business of abstracting, and will pay all damage that may accrue to any person by reason of any incompleteness, imperfections, or errors in any abstract furnished by him," and which further provides that the person executing the bond shall be liable "to any person or persons for whom he or they may compile, make or furnish abstracts of title to the amount of damage done to the said person or persons by any incompleteness, imperfections, or errors" made by the abstracter, renders the abstracter liable to persons not in privity with him, for errors in the certificate of search upon which they may rely. Washington County Abstract Co. v. Harris (1915) 48 Okla. 577, 149 Pac. 1075; Sackett v. Rose (1916) 55 Okla. 398,

L.R.A.1916D, 820, 154 Pac. 1177; Scott v. Jordan (1916) 55 Okla. 708, 155 Pac. 498. And see also Gregory v. Harper (1915) 51 Okla. 419, 152 Pac. 7. And under a similar provision of the Idaho statutes (Comp. Stat. § 2262) an abstracter was held liable to a purchaser from the party procuring the abstract, for negligence in preparing it. The court stated that in the absence of statute there could have been no recovery, for the reason there was no privity between the parties. Merrill v. Fremont Abstract Co. (1924) Idaho, 227 Pac. 34.

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And a similar conclusion was reached under a subsequent amendment of the Nebraska statute (Rev. Stat. 1913, § 6277) containing, in substance, the same provision as in the earlier enactment, in Crook v. Chilvers (1916) 99 Neb. 685, 157 N. W. 617, Ann. Cas. 1918E, 90, 13 N. C. C. A. 431, holding that a purchaser of real estate was entitled to maintain an action against an abstracter employed by the vendor. See also Marcell v. Midland Title Guarantee & A. Co. (1924) Neb., 199 N. W. 731.

And under the Nebraska statute (Sess. Laws 1887, p. 65, chap. 64) providing that anyone engaged in the business of compiling abstracts of titles shall execute a bond conditioned for the payment of any and all damages accruing to any party by reason of any error, deficiency, or mistake in making the abstract, which further provides that the abstract shall be prima facie evidence of the existence of any encumbrance mentioned therein, it was held in Gate City Abstract Co. v. Post (1898) 55 Neb. 742, 76 N. W. 471, that a subsequent grantee from the person securing the abstract, who relied thereon, was entitled to maintain an action on the abstracter's bond for false recitals in the certificate of abstract. The court states: "It is matter of common knowledge that titles are generally transferred and encumbered on the faith and credit of certificates furnished by abstracters to the owners of the land. An abstract has become the usual comitant of every instrument evidencing an interest or owner

ship in land. Its function is to vouch for the title, to define its character, and afford a reliable basis on which to estimate its marketable worth. That being the case, it seems highly probable that, in adopting the act in question, the legislative design comprehended protection to those who, in dealing with land titles, rely on the correctness of the abstracter's certificate. They stood most in need of legislation of this character, and, being fairly within the description of persons for whose benefit the law was enacted, we feel warranted in holding that they are within its terms."

And the Kansas statute (Laws 1903, chap. 1, Gen. Stat. 1909, ¶ 1690) extends the liability of the abstracter on his bond to include all damages caused to any person or persons by reason of the incompleteness, imperfections, or errors made by the abstracter, and under that statute a subsequent grantee from the person securing the abstract may recover on the abstracter's bond for error in making the search, even though the terms of the bond did not cover any liability except such as might arise in favor of the persons for whom the abstract was made, where there is another provision in the bond that the abstracter will properly demean himself in the business of abstracting, the court stating that that could only be done by the performance of the duty as the law provides. Arnold v. Barner (1914) 91 Kan. 768, 139 Pac. 404, Ann. Cas. 1915D, 446, 6 N. C. C. A. 965.

b. Notaries public, justices of peace, etc.

Generally, as to the question of the liability of a notary public on his bonds, see annotation in 18 A.L.R. 1302, supplemented in 31 A.L.R. 920. A notary public, justice of the peace, or other like officer is liable at common law, or on his official bond, for damage proximately caused to any person by relying on a certificate to an acknowledgment of a deed, mortgage, bill of sale, or similar instrument, in which he falsely certifies that the parties thereto are personally known to him, and appeared and acknowledged the instrument.

California.

Hatton V. Holmes (1893) 97 Cal. 208, 31 Pac. 1131; Joost v. Craig (1901) 131 Cal. 504, 82 Am. St. Rep. 374, 63 Pac. 840; Homan v. Wayer (1908) 9 Cal. App. 123, 98 Pac. 80; Kleinpeter v. Castro (1909) 11 Cal. App. 83, 103 Pac. 1090; Anderson v. Aronsohn (1919) 181 Cal. 294, 10 A.L.R. 866, 184 Pac. 12.

Illinois. People use of Munson v. Bartels (1891) 138 III. 322, 27 N. E. 1091.

Iowa.-Wilson v. Gribben (1911) 152 Iowa, 379, 132 N. W. 849.

Kansas.-Brown v. Graves (1923) 114 Kan. 602, 220 Pac. 247.

Kentucky. Samuels v. Brand (1904) 119 Ky. 13, 82 S. W. 977; Com. use of Green v. Johnson (1906) 123 Ky. 437, 124 Am. St. Rep. 368, 96 S. W. 801, 13 Ann. Cas. 716.

Michigan.-People ex rel. Curtiss v. Colby (1878) 39 Mich. 458.

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Minnesota. Barnard v. Schuler (1907) 100 Minn. 289, 110 N. W. 966. Missouri.-State use of Kleinsorge v. Meyer (1876) 2 Mo. App. 413; State v. Plass (1894) 58 Mo. App. 148; State ex rel. Covenant Mut. L. Ins. Co. v. Balmer (1898) 77 Mo. App. 463; State ex rel. Heitkamp v. Ryland (1901) 163 Mo. 280, 63 S. W. 819; State v. Grundon (1901) 90 Mo. App. 266; State ex rel. Savings Trust Co. V. Hallen (1912) 165 Mo. App. 422, 146 S. W. 1171, later appeal in (1917) Mo. App., 196 S. W. 1067; State ex rel. Gardner v. Webb (1914) 177 Mo. App. 60, 164 S. W. 184; State ex rel. Savings Trust Co. v. Hallen (1917) Mo. App. - 196 S. W. 1067; State ex rel. Dominick v. Farmer (1918) App., 201 S. W. 955; State ex rel. Haitz v. American Surety Co. (1920) 203 Mo. App. 71, 217 S. W. 317.

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Mo.

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(1913) 39 Okla. 775, 136 Pac. 758; Clapp v. Miller (1916) 56 Okla. 29, 156 Pac. 210, 11 N. C. C. A. 581; Clapp v. Miller (1923) 89 Okla. 38, 213 Pac. 854.

Tennessee.-Figuers v. Fly (1917) 137 Tenn. 358, 193 S. W. 117. Texas.-Brittain v. Monsur (1917) Tex. Civ. App. 195 S. W. 911. Washington. Kangley v. Rogers (1915) 85 Wash. 250, 147 Pac. 898.

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As stated in State ex rel. Gardner v. Webb (1914) 177 Mo. App. 60, 164 S. W. 184, "great faith and credit customarily are reposed in the certificates of such officers, and a corresponding duty is imposed on them to exercise care and caution such as a reasonably careful and prudent man, burdened with such responsibility, would exercise, to guard against being led into making a false certificate."

In Figuers v. Fly (Tenn.) supra, the court states: "A certificate of acknowledgment is an act which must, in the nature of things, be relied on with confidence by men of business. Those buying or taking security by way of liens on real estate ought not to be required to look with suspicion on such a certificate, or compelled to make proof of its recital as to the notary's personal acquaintance with the acknowledger."

And as a notary public, certifying under seal that all parties to a deed of assignment of a leasehold appeared before him and acknowledged the deed, whereas only three of the four persons named therein were present, and the signature of the fourth, known to the notary, was forged, is not liable to the purchaser from the assignee, who supposed he got good title, for expense he was compelled to undergo on account of the notary's false act. Ware v. Brown (1869) 2 Bond. 267, Fed. Cas. No. 17,170. The court stated there was no privity of contract between the plaintiff and the parties implicated in the fraud, and there could have been no intention to defraud or injure him, and that, as it was the duty of the plaintiff to inquire as to the validity of his grantor's title, he could see no reason

why the doctrine of caveat emptor should not apply.

But in Smith v. Maginnis (1905) 75 Ark. 472, 89 S. W. 91, a notary public was held not liable, for falsely certifying to an acknowledgment to an affidavit that certain persons were entitled to homestead entries, to purchasers relying upon the affidavit and certificate, where the essential purpose of the affidavit was to establish the right to the satisfaction of the government, since the proximate cause of the injury was the wrongful act of the vendor in selling what he did not own, and not the negligent act of the notary in certifying to the affidavit. And to the same effect is Coffin v. Bruton (1906) 78 Ark. 162, 95 S. W. 462.

A notary public who falsely certifies to a forged affidavit concerning title to real property, purporting to have been made by the owners thereof, will be liable for the loss occasioned to a person relying on the genuineness of the affidavit, who makes a loan on the property on a mortgage forged by the same person who forged the affidavit. State ex rel. Gardner v. Webb (1913) 177 Mo. App. 60, 164 S. W. 184.

c. Inspectors.

The reported case (NATIONAL IRON & STEEL Co. v. HUNT, ante, 63) holds that one purchasing rails from another has no right of action against one who inspected them for the latter, for a false report, although he acted upon the report so made. The court observes that the facts that the inspectors held themselves out as experts, and that business men relied upon their reports in purchasing materials, did not operate to change the rule requiring that there be privity between the parties; the defendants only assumed the duties and obligations of experts when they were employed to render expert services, and their obligations in that regard extended only to persons who bought and paid for those services. On an earlier appeal, the lower court, in (1915) 192 Ill. App. 215, held that this case presented an exception to the general rule that no liability was in

curred to persons not in privity, as being a case where a person undertook to discharge a duty by which the conduct of another might be regulated and governed, and which he was bound to perform in such a manner that one rightfully led to a course of conduct on the faith of that act should not suffer loss or injury by reason of his negligence.

So, a grain inspector appointed by the board of directors of the Merchants' Exchange, who give certificates of quality of grain purchased and sold, which, by the general custom of trade, are regarded by the grain merchants as evidence that the grain inspected is of the quality certified to, is not liable to a purchaser from a dealer at whose instance an inspection is made, for giving a false certificate of inspection that the grain was of a certain quality, which the purchaser accepted without further inspection, on the faith of the certificate. Gordon v. Livingston (1882) 12 Mo. App. 267.

But in the following cases the doctrine of Glanzer v. Shepard (N. Y.) infra, II. e, that one following a common calling may come under a duty to another than the one whom he serves, though a third party may give the order, is apparently the basis of the decision in the following cases, dealing with the liability of food inspectors for damages caused by false. or erroneous certificates of inspection:

Tardos v. Bozant (1846) 1 La. Ann. 199, where an official inspector of pork was held liable to a purchaser for negligence in the inspection of the pork and for issuing a false certificate of inspection. The court stated that the only mode of securing the objects of inspection, that is, the giving of security to commerce and the increase in confidence of purchasers in the soundness of the article sold, was to hold the inspector responsible for all ordinary diligence in the discharge of his duties;

-Nickerson v. Thompson (1851) 33 Me. 433, where a fish inspector was held liable to a purchaser buying on the face of the inspection blank, for negligence in the inspection;

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