Deceit [fr. deceptio, Lat.], fraud, cheat, craft, or collusion used to deceive and defraud another. In an action of deceit the plaintiff must prove that the defendant has made a false statement, knowing that it was false or without any belief in its truth or without caring whether it was true or not, and intending that the plaintiff should rely upon it and that the statement was relied upon by the plaintiff and caused damage; non-disclosure may be fradulent, see Suppressio veri, suggestio falsi,' and Cackett v. Keswick, (1902) 2 Ch 456, and Christine Ville Rubber Estates, (1911) 28 TLR 38, and CONCEALMENT [Smith v. Chadwick, (1884) 9 AC 187, and Dery v. Peek, (1889) 14 App Cas 337]. Under the (English) Companies Act, 1929, s. 37, a special action for deceit will lie at the instance of any subscriber for shares or debentures who has subscribed for these on the faith of a prospectus inviting him to subscribe against any director, or person named or referred to as a director in the prospectus and any promoter of the company, or person authorizing the issue of the prospectus if there is any untrue statement in the prospectus or in any report or memorandum set out in the prospectus or by reference incorporated therein or issued therewith. The onus is on the defendant to clear himself by any of the defences provided for in the section (see DIRECTORS). In these cases there is a statutory right of contribution, see s. 37(3), from which (apparently) guilty promotes have been excluded. See also (English) Law Reform (Misc. Pr.) Act, 1935, s. 6. The injured shareholder may also sue the company for rescission. See Frankenburg v. Great Horseless Carriage Co., (1900) 1 QB 504, and see also Sched. XI of the Act of 1929 and MISREPRESENTATION; FRAUD.
There was formerly a writ of deceit, which was an action brought in the Common Pleas to reverse a judgment obtained in any real action, by fraud or collusion between the parties to the prejudice of the right of a third person. it was abolished by the (English) Real Property Limitation Act, 1833 (3 & 4 Wm. 4, c. 27), s. 36.
Deceit is a false statement of a fact made by a person knowingly or recklessly with the intent that it shall be acted upon by another who does act upon it and thereby, suffers damage, Ellerman And Bucknall Steamship Co. Ltd. v. Misrimal Bheraji, AIR 1966 SC 1892: 1966 Supp SCR 92. [Carriage of Goods by Sea Act, 1925, s. 4]
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