The rating of a mercantile agency is merely its conclusion as to the financial status of the person to whom it relates. In this case, the conclusion was based partly upon statements furnished by the defendant and partly upon information derived from other sources. There had been a long course of dealing between the parties, and the statements made by the defendant, which included an itemized enumeration of assets and liabilities, were not communicated to the plaintiffs, and were neither known to nor relied upon by them when they gave the credit. It is not only unsafe, *Page 528 but a violation of sound principles, to permit a recovery for deceit, with the severe consequences that may follow, unless the evidence connects the false statements directly with the person alleged to have practiced the deceit, or with his duly authorized agent acting within the scope of his authority. A mercantile agency is not such an agent as to make its mere inference as to the effect of the debtor's statements binding upon him. Its authority, so far as he is concerned, is limited to the transmission of his statement, as made by him, or the substance thereof, to its subscribers. When it gives its opinion, simply, it does not act as his agent, but as the agent of the subscriber. In Eaton, C. B. Co. v. Avery (83 N.Y. 31) the statements made by the purchaser were communicated to the seller, not the mere rating of the agency, and this court said: "By making a statement as to the financial condition of his firm to such an agency he virtually instructed it what to say if inquired of;" that is, the agency should report what the purchaser said, not its conclusion as to the effect of what he said. Commenting upon that case, we said in Macullar v. McKinley (99 N.Y. 353,358), "there was a direct and an intended connection between the representation and the credit obtained." So in Bliss v.Sickles (142 N.Y. 647) the detailed statement in writing, made by the purchaser, reached the seller through a third person, to whom it was made for that purpose, and thus became the direct foundation of the credit given.
The tender regard which the law has for personal liberty will not permit the arrest and imprisonment of a citizen upon the mere rating of a commercial agency, without any communication of the facts, as stated by him, upon which the rating was based.
I dissent from the judgment about to be pronounced and vote to affirm for the reasons given by the Appellate Division in its opinion.
PARKER, Ch. J., GRAY, HAIGHT, MARTIN, JJ. (and BARTLETT, J., in memorandum), concur with O'BRIEN, J.; VANN, J., dissents.
Judgment reversed, etc. *Page 529