holding that negligent misrepresentation is not restricted to business matters, but "situations where the information supplied harmed the plaintiff in its relations with third parties"
How later courts described this case
- holding that negligent misrepresentation is not restricted to business matters, but "situations where the information supplied harmed the plaintiff in its relations with third parties"
- noting that courts have not found a need to treat negligent misrepresentation as a cause of action distinct and separate from a negligence claim “when the conduct has caused personal injury or property damage,” but that “when misrepresentation based on negligent acts results solely in an interference with intangible economic interests, more restrictive rules of recovery have been developed”
- observing that where a person is in the business of supplying information to others, and where that person is “aware of the use that the information will be put, and intends to supply it for that purpose,” the harm from a misrepresentation is foreseeable
- holding that the defendant must “be in the business or profession of supplying information for the guidance of others” to sustain negligent misrepresentation claim
Written by the judges who cited it.
The opinion
NEUMAN, Justice
(dissenting).
I respectfully dissent. The majority’s opinion, while methodical and thorough, ultimately exalts logic over experience. The result spells disaster for the law. For, as we all know, the life of the law is not logic but experience. 5
Experience teaches us that guidance counselors — along with myriad others in our public schools — dispense volumes of information on a daily basis, some of it good, some perhaps not so good. Indeed, as the majority forcefully argues, educators are professionals in the business of supplying information. And we hope they take their information-giving jobs seriously, for the future of the next generation depends on them.
The question is, when academic advice goes awry, should a student be permitted to seek relief from the courts? The answer to date, as the majority concedes, has always been “no.” Good reasons abound for this decision. See Moore v. Vanderloo, 386 N.W.2d 108, 113-15 (Iowa 1986) (dismissing alleged claim of educational malpractice). Courts are ill-equipped to pass judgment on the wisdom and value of a school’s chosen curriculum. Id. We have thus been historically disinclined to do so.
The majority effectively jettisons this sound doctrine by theorizing that guidance counselors, being in the business of furnishing information, come within the ambit of section 552 of the Restatement (Second) of Torts. They may be liable, the majority holds, for the tort of negligent misrepresentation. For liability to attach under the rule, however, misinformation must be supplied “for the guidance of others in their business transactions. ” Restatement (Second) of Torts § 552 (emphasis added). It is here, I think, that the majority’s logic flies in the. face of experience.
To accept the majority’s decision, one must be willing to view the mentoring relationship between a guidance counselor and a student as no different than a business relationship between a purveyor of information and a consumer. I disagree with that premise. We may live in an information age, but experience tells me the sharing, of knowledge in school is different than the sale of information in the marketplace.
*130 I am also concerned about the “floodgates” argument that discouraged us from moving in this direction in Moore. See Moore, 386 N.W.2d at 115 . Implicit in the majority’s reasoning is the suggestion that, when it comes to NCAA eligibility rules and athletic scholarships, business is the name of the game. But the cause of action we recognize today will not be limited to athletes. It will apply to all students, whether talented in music or debate or academics. Instead of encouraging sound academic guidance, today’s decision will discourage advising altogether. I cannot join it.
TERNUS, J., joins this dissent.
. Oliver Wendell Holmes, Jr., The Common Law (1881).