State v. Duncan

181 Mont. 382, 593 P.2d 1026 (Mont. 1979)

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Nature of the Case

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Facts

Duncan (D) induced investors to supply sealed bags of charcoal. The investors would get the sealing machine from D's company to do the required work. The investors were told that 5% of the deposit they put down on the machines would be placed in a trust account to guarantee them repayment at the end of the contract. This was not true. The investors were told that only 55 agreements would be sold in the area (82 were actually sold). Each investor was guaranteed a set quota of bags and a guaranteed income depending on the amount of their deposit. D's company committed to a production rate of $360,000 per month. The actual income from previous sales was just $2,700 per month. D's company also represented to the investors that it had large contracts with two large retailers. This was not true. The investors did not receive their quotas. D was convicted of deceptive practices under a Montana statute. D appealed: the statute was a codified version of false pretenses and his promises were to future events.