                   United States Court of Appeals,

                          Eleventh Circuit.

                            No. 94-3521.

 GILCHRIST TIMBER CO., C.L. Brice, L.A. Brice, Andy M. Brice, Sam
Brice, Plaintiffs-Appellants,

                                 v.

             ITT RAYONIER, INC., Defendant-Appellee,

                                 v.

      NATURAL RESOURCE PLANNING SERVICES, INC. and Andrew V.
Santangini, Third-Party-Defendants.

                           Sept. 20, 1996.

Appeal from the United States District Court for the Northern
District of Florida (No. 88-10172-MMP); Maurice M. Paul, Judge.

Before EDMONDSON and DUBINA, Circuit Judges, and LOGAN*, Senior
Circuit Judge.

     PER CURIAM:

  CERTIFICATION FROM THE UNITED STATES COURT OF APPEALS FOR THE
ELEVENTH CIRCUIT TO THE SUPREME COURT OF FLORIDA, PURSUANT TO
SECTION 25.031, FLORIDA STATUTES, AND RULE 9.150, FLORIDA RULES OF
APPELLATE PROCEDURE.

   TO THE SUPREME COURT OF FLORIDA, AND THE HONORABLE JUSTICES
THEREOF:

     It appears to the United States Court of Appeals for the

Eleventh Circuit that the above-styled case involves a question of

state law that is determinative of the cause, and there appear to

be no clear, controlling precedents in the decisions of the Supreme

Court of Florida.    This court therefore certifies the following

question of Florida law to the Supreme Court of Florida for

instructions concerning such question of law, based on the facts


     *
      Honorable James K. Logan, Senior U.S. Circuit Judge for the
Tenth Circuit, sitting by designation.
recited herein:

     Whether a party to a transaction who transmits false
     information which that party did not know was false, may be
     held liable for negligent misrepresentation when the recipient
     of the information relied on the information's truthfulness,
     despite the fact that an investigation by the recipient would
     have revealed the falsity of the information.

                          I. STYLE OF THE CASE

     The style of the case in which this certification is made is

as follows:    Gilchrist Timber Co., C.L. Brice, L.A. Brice, Andy M.

Brice, Sam Brice, Plaintiffs-Appellants, versus ITT Rayonier, Inc.,

Defendant-Appellee, versus Natural Resource Planning Services, Inc.

and Andrew V. Santangini, Third-Party Defendants, No. 94-3521,

United States Court of Appeals for the Eleventh Circuit, on appeal

from the United States District Court for the Northern District of

Florida.

                                II. FACTS

     In this diversity action plaintiffs, Gilchrist Timber Company,

C.L. Brice, L.A. Brice, Andy M. Brice, and Sam Brice,1 alleged that

defendant     ITT   Rayonier,   Inc.   (ITT)    made   a   material    false

representation of the zoning of a large block of Florida timberland

that it sold to plaintiffs, causing them economic injury.             After a

jury found in favor of plaintiffs the district court granted

defendant   judgment    notwithstanding   the    verdict   and   plaintiffs

appealed.

     1
      The original complaint named as plaintiff Gilchrist Timber
Company. The amended complaint substituted as plaintiffs C.L.
Brice, as trustee of the Carl L. Brice 1977 Irrevocable Trust,
L.A. Brice, Andy M. Brice, and Sam Brice, individually and doing
business as Gilchrist Timber Company, a Florida Partnership.
Thereafter Carla Sutton (a/k/a Carla Brice) and David M. Miller,
cotrustees of the Carl L. Brice 1977 Irrevocable Trust, joined as
plaintiffs.
     In 1985, Jimmy Ray Mincy, a timber broker, became interested

in   purchasing   a   tract   of   timberland   (the   timberland)   from

defendant.    He solicited C.L. Brice, who was involved in timber,

ranching and real estate, to join him in making the purchase.

Brice and Mincy ultimately purchased the 22,641-acre tract.          They

presented evidence at trial that they planned to cut and sell the

timber and then to sell a significant portion of the land in small

tracts for farming or residential development.

     Mincy and Brice met with ITT's representatives to discuss

purchasing the timberland.         Brice testified that at this first

meeting Kent Smith, then ITT's Director of Forest Land Management,

gave Brice and Mincy a copy of an April 1984 appraisal that ITT had

obtained when it decided to sell various timberlands to raise cash.

The document included a land appraisal by Andrew Santangini and a

timber appraisal by Natural Resource Planning's Tom Mastin.           The

appraisal stated that the timberland was zoned for agriculture,

which allows residential usage.        Mincy and Brice testified they

decided to buy the timberland only because the zoning allowed

residential   development.         Uncontroverted   evidence   at    trial

indicated that the parties never discussed zoning, although the

information contained in the timber appraisal—such as the quantity

and quality of timber—was discussed at length.

     Immediately after the closing, Brice and Mincy conveyed the

land and timber to their partnership, Gilchrist Timber Company.

More than a year after the purchase, when Gilchrist Timber had

removed some timber and attempted to sell some acreage, plaintiffs

learned that the vast majority of the timberland was actually zoned
"preservation," a classification permitting no residential use.2

Brice and Mincy attempted unsuccessfully to change the zoning.

Plaintiffs asserted that they could not sell the land as planned

and lost the benefit of their bargain.               They brought this suit,

alleging   defendant       misrepresented      that    the     land   was    zoned

agricultural. 3    The jury found in favor of plaintiffs and awarded

damages of $1,676,500, but the district court granted defendant

ITT's motion for judgment notwithstanding the verdict. As relevant

to the question we submit the district court found that ITT was

itself   unaware    that    the    zoning   classification      stated      in    the

appraisal report was inaccurate, a finding the record supports.

Thus this case involved negligent misrepresentation.

                                 III. DISCUSSION

     Plaintiffs argue that under Florida law ITT had a duty to

discover   the     error    in    the   appraisal    but   plaintiffs       had    no

corresponding duty to determine whether the facts in the appraisal

on which they relied were true.             Plaintiffs rely on        Besett v.

Basnett, 389 So.2d 995 (Fla.1980).             In   Besett, the buyers of a

lodge    and     property        alleged    that    the    sellers     knowingly

misrepresented      the    lodge's      business    history,    condition,        and

acreage. The buyers did not investigate these representations, and


     2
      The record contains conflicting testimony on exactly how
and when plaintiffs discovered the zoning problem.
     3
      Defendant ITT brought in as third party defendants Andrew
Santangini and Natural Resource Planning, who performed the land
and timber appraisals, respectively, asserting a right of
indemnity in the event ITT were held liable. Plaintiffs made no
direct claims against the third party defendants. The jury found
no liability against the third party defendants, and that
determination is not part of the appeal to the Eleventh Circuit.
relied on them in deciding to buy the lodge and land.      The Besett

court concluded the buyers had no duty to investigate, although it

noted that a purchaser would not be justified in relying on an

obviously false representation.     Plaintiffs also cite    Lynch v.

Fanning, 440 So.2d 79 (Fla. 1st D.C.A.1983), in which a buyer

failed to exercise his contractual right to secure a survey and

thus did not discover that the seller's property description was

false.     That decision held such failure did not eliminate the

plaintiff's cause of action.    Id. at 80 (citing Held v. Trafford

Realty Co., 414 So.2d 631 (Fla. 5th D.C.A.1982)).

     Defendant contends that other Florida cases limit the holdings

of Besett and Lynch.    For example, in Wasser v. Sasoni, 652 So.2d

411 (Fla. 3d D.C.A.1995), after closing on an "as is" contract for

a commercial apartment building, the buyers found the building

needed structural repairs and sued based on both affirmative

misrepresentations and failure of the sellers to disclose alleged

defects.    On buyers' appeal from a grant of summary judgment, the

court of appeals held that "an intentional nondisclosure of known

facts materially affecting the value of commercial property[ ] is

not actionable under Florida law."     Id. at 412.   The court also

stated that "[a]ssuming arguendo that false representations had

been made, a misrepresentation is not actionable where its truth

might have been discovered by the exercise of ordinary diligence."

Id. (citing Steinberg v. Bay Terrace Apartment Hotel, 375 So.2d

1089 (Fla. 3d D.C.A.1979)).    The Wasser court characterized Besett

as an exception—a circumstance in which specific misrepresentations

regarding a latent defect were made to a negligent purchaser.     It
stated    "there    is   no   exception   where   the   parties   are   equally

sophisticated, and have an equal opportunity to discover a defect."

Id. at 413.     See also David v. Davenport, 656 So.2d 952, 953 (Fla.

3d D.C.A.1995) (misrepresentation in car sale not actionable if

truth could be discovered by ordinary diligence, citing Wasser)

(dicta); Adams v. Prestressed Sys., Inc., 625 So.2d 895, 897 (Fla.

1st D.C.A.1993) ("[i]n the civil context, a party who relies on a

misrepresentation must show that it exercised some diligence in

investigating the misrepresentation, unless it is shown that the

fraudulent party had exclusive or superior knowledge, or prevented

further investigation") (workers' compensation).              But see Sheen v.

Jenkins, 629 So.2d 1033, 1035 (Fla. 4th D.C.A.1993) (jury may find

plaintiff justifiably relied upon misrepresentation even if she

could have ascertained truth by making an investigation, unless she

knows of falsity or falsity is obvious to her) (investment fraud);

Eastern Cement v. Halliburton Co., 600 So.2d 469, 471 (Fla. 4th

D.C.A.) (in fraudulent misrepresentation claim, buyer under no duty

to investigate truth or falsity of statements unless had reason to

know of falsity, citing Besett ), review denied, 613 So.2d 4

(Fla.1992) (sale of cement pumping equipment);            Revitz v. Terrell,

572 So.2d 996, 998-99 (Fla. 3d D.C.A.1990) (real estate recision

action for fraudulent misrepresentation concerning flood insurance

and building code violations;             recipient may rely on truth of

representation even if could have ascertained falsity with an

investigation, citing Besett );           Gold v. Perry, 456 So.2d 1197,

1201 (Fla. 4th D.C.A.1984) (rejecting idea, in intentional fraud

case,    that   a   party's   business    experience    and   success   may   be
considered in determining whether reliance justifiable);                   cf.

Johnson v. Davis, 480 So.2d 625, 627-28 (Fla.1985) (where seller of

home knows of latent defects, duty to disclose if not readily

observable or known to buyer).

     Obviously Besett, as a Florida Supreme Court case, would

control if applicable.        But we are uncertain whether the court

would apply the rule of Besett in a negligent misrepresentation

case.   In Besett, the court adopted the Restatement (Second) of

Torts § 540 (1976), which applied to fraudulent misrepresentations,

and which says, "[t]he recipient of a fraudulent misrepresentation

of fact is justified in relying upon its truth, although he might

have ascertained the falsity of the representation had he made an

investigation."      Besett, 389 So.2d at 997 (emphasis added).            The

reason for this rule is that "[a] person guilty of fraudulent

misrepresentation should not be permitted to hide behind the

doctrine of caveat emptor."        Id.;     see also Cruise v. Graham, 622

So.2d 37, 40 (Fla. 4th D.C.A.1993) (fraudulent misrepresentation is

an intentional tort, making comparative negligence no defense).

     The elements of fraudulent misrepresentation and negligent

misrepresentation appear to be the same under Florida law.                 See

Baggett v. Electrician's Local 915 Credit Union, 620 So.2d 784, 785

(Fla. 2d D.C.A.1993);        Thor Bear, Inc. v. Crocker Mizner Park,

Inc., 648 So.2d 168, 172 (Fla. 4th D.C.A.1994).          But it may be that

what constitutes "justifiable reliance" for the two claims is

different.    According to the Florida Supreme Court's standard jury

instructions, "[i]t appears that Florida recognizes two separate

theories     of   recovery   for   damage    occurring   as   a   result    of
misrepresentation.   One basis ... is for fraud and the other is for

negligent misrepresentation." See Standard Jury Instructions—Civil

Cases, 613 So.2d 1316, 1319 (Fla.1993).   The standard instructions

suggest that only when there is a fraudulent misrepresentation is

the recipient "justified in relying upon its truth, even where an

investigation might have revealed its falsity." Id. (citing Besett

).

     Also, if Besett can be seen as Florida's adoption of the

Restatement (Second) approach to the law of misrepresentation, it

might be important that under the Restatement (Second) of Torts §

552A, "[t]he recipient of a negligent misrepresentation is barred

from recovery ... suffered in reliance upon it if he is negligent

in so relying."      This view is consistent with the idea that

contributory negligence is a defense to unintentional torts, but

not to intentional torts.    See Cruise, 622 So.2d at 40.    On the

other hand, Lynch v. Fanning, 440 So.2d 79 (Fla. 1st D.C.A.1983),

appears to have applied Besett 's logic to negligence claims.

     Without further guidance from the Florida Supreme Court on the

question certified, this court cannot resolve the appeal before us

with confidence.     Thus, we certify the question stated at the

outset of this opinion.

     The phrasing employed in the certified question is intended as

a guide and is not meant to restrict the Florida Supreme Court's

consideration of the issues in its analysis of the record certified

in this case.   This extends to the Supreme Court's restatement of

the issue and the manner in which the answer is given.          See

Martinez v. Rodriquez, 394 F.2d 156, 159 n. 6 (5th Cir.1968).
     The   clerk   of   this   court   is   directed   to   transmit   this

certificate, as well as the briefs and record filed with the court,

to the Supreme Court of Florida and simultaneously to transmit

copies of the certificate to the attorneys for the parties.
