Reconstruction Finance Corporation's agents with whom he dealt.
Where, as here alleged, there is a misrepresentation of opinion or future occurrence coupled with a misrepresentation of present existing facts, the misrepresentations may constitute fraud under the law of Pennsylvania. See: Standard Interlock Elevator Co. v. Wilson, 1907, 218 Pa. 280, 67 A. 463; Lake v. Thompson, 1951, 366 Pa. 352, 77 A.2d 364, 366; Zettlemoyer v. Bloch, 1938, 329 Pa. 205, 198 A. 80; Gillespie v. Hunt, 1923, 276 Pa. 119, 119 A. 815; Boulevard Airport, Inc. v. Consolidated Vultee Aircraft Corp., D.C.E.D.Pa.1949, 85 F.Supp. 876.
It seems to be the law of Pennsylvania that one may be justified in relying on a misrepresentation of value where he does not have means to verify it. See: Lake v. Thompson, supra. Furthermore, it is not essential that the agents in question had an intention to deceive, for even an innocent misrepresentation of fact may be fraudulent. See: LaCourse v. Kiesel, 1951, 366 Pa. 385, 77 A.2d 877.
The plaintiff's motion for summary judgment will be denied.
Motion to Dismiss Counterclaim
By his counterclaim, which the plaintiff moves this court to dismiss, the defendant seeks to recover an affirmative judgment against the plaintiff in the sum of $ 1,371.20. This claim is based on the alleged misrepresentations of the agents of the Reconstruction Finance Corporation previously mentioned in this opinion, and as such sounds in tort in the nature of an action of deceit. The defendant in his answer first raised the defense of fraud to the plaintiff's claim on the note in question; in the counterclaim defendant again denied any indebtedness to the plaintiff and claimed the $ 1,371.20 not on any theory of recoupment or set-off, but on the theory of an affirmative right of recovery. The counterclaim must be dismissed.
It is fundamental 'that without specific statutory consent, no suit may be brought against the United States.' United States v. Shaw, 1940, 309 U.S. 495, 500-501, 60 S. Ct. 659, 661, 84 L. Ed. 888. Although the defendant cites 28 U.S.C.A. § 1346(b) as the requisite statutory authority for his counterclaim, section 2680(h) of that title specifically excludes from the scope of section 1346(b) any claim based on, inter alia, deceit or misrepresentation. See Miller Harness Co. v. United States, 2 Cir., 1957, 241 F.2d 781.
The fact that the instant suit was instituted by the United States and that defendant's claim for affirmative relief comes in the form of a counterclaim in that suit arising out of the transactions upon which the government bases its action, does not enlarge the defendant's rights to sue the government. The defendant's counterclaim is not in the form of recoupment or set-off but rather an independent claim for affirmative relief. In the case of In re Monongahela Rye Liquors, 3 Cir., 1944, 141 F.2d 864, at page 869, the court said:
'It is, of course, true that when the United States or a State institutes a suit, it thereby submits itself to the jurisdiction of the court, but, as to claims against the sovereign, the latter's submission to a court's jurisdiction, because of its suit, draws in only such adverse claims as have arisen out of the same transaction which gave rise to the sovereign's suit. * * * A defendant's right in such regard is one of recoupment.'
The court then cites Bull v. United States, 1935, 295 U.S. 247, 55 S. Ct. 695, 79 L. Ed. 1421, for the proposition that recoupment is in the nature of a defense. See also United States v. Finn, 9 Cir., 1956, 239 F.2d 679, and In re Greenstreet, Inc., 7 Cir., 1954, 209 F.2d 660 where at page 664 the court stated:
'The postulate to be distilled from the cases is * * * that the United States, by initiating an action as a plaintiff, consents to the jurisdiction of the court to entertain any defensive plea including the right of set-off to the extent of the government's claim, but does not thereby consent to an affirmative judgment on a counterclaim.' (Emphasis supplied.)
The court also cited, inter alia, United States v. United States Fidelity & Guaranty Co., 1940, 309 U.S. 506, 60 S. Ct. 653, 84 L. Ed. 894, and United States v. Shaw, supra. See also: Waylyn Corporation v. United States, 1 Cir., 1956, 231 F.2d 544, certiorari denied 352 U.S. 827, 77 S. Ct. 40, 1 L. Ed. 2d 49.
The plaintiff's motion to dismiss the defendant's counterclaim will be granted.