Nichols v. Moore

183 P. 531, 181 Cal. 131, 1919 Cal. LEXIS 330

• Court: California Supreme Court
• Decided: August 25, 1919
• Docket: L. A. No. 5235.
• Status: Published

Opinion

WILBUR, J.

This is an action to recover damages for-fraud. Demurrer was sustained to the complaint on the ground that the claim was barred by the statute of limitations. The transaction complained of occurred in October, 1904. Plaintiff alleges that the fraud was first discovered by her in October, 1916, a few months before the bringing of the action. [1] As stated in Bradbury v. Higginson, 167 Cal. 553, 558, [140 Pac. 254], and cases therein cited, it is necessary for the party seeking to avoid the bar to affirmatively plead facts excusing the failure to make an earlier discovery of the mistake or fraud relied upon, citing Dennis v. Bint, 122 Cal. 39, [68 Am. St. Rep. 17, 54 Pac. 378]; Harrington v. Paterson, 124 Cal. 542, [57 Pac. 476]; Lady Washington Co. v. Wood, 113 Cal. 482, [45 Pac. 809]. As was there said: “But a mere averment of ignorance of a fact which a party might with reasonable diligence have discovered is not enough to postpone the running of the statute. (Hecht v. Slaney, 72 Cal. 363, [14 Pac. 88]; Burling v. Newlands, 112 Cal. 476, [44 Pac. 810]; Lady Washington Co. v. Wood, 113 Cal. 482, [45 Pac. 809]; Tracy v. Muir, 151 Cal. 363, [121 Am. St. Rep. 117, 90 Pac. 832].)” In Phelps v. Grady, 168 Cal. 75, 77, [141 Pac. 926, 928], the rule stated in Wood v. Carpenter, 101 U. S. 135, [25 L. Ed. 807, see, also, Rose's U. S. Notes], concerning pleadings in such cases, is cited and approved as the rule “consistently adopted and adhered to in this state,” citing Robertson v. Burrell, 110 Cal. 578, [42 Pac. 1086]; Lady Washington Co. v. Wood, 113 Cal. 485, [45 Pac. 809]; Simpson v. Dalziel, 135 Cal. 603, [67 Pac. 1080]; People v. San Joaquin etc. Assn., 151 Cal. 797, [91 Pac. 740]. In order to determine the question whether or not the plaintiff has shown reasonable diligence to acquaint herself with the facts constituting the fraud and, therefore, whether her claim is barred by the statute of limitations, it will be necessary to state some of the facts and circumstances concerning the fraud alleged and the discovery thereof. The complaint is based upon defendants’ fraud in securing a contract by which plaintiff transferred an orange grove in Riverside, California, worth ten thousand dollars and returning an income of a thousand dollars a year, for defendants’ land in the state of Washington, which is absolutely valueless. At the time of the transaction plaintiff was living in Ohio and the defendants were living in Riverside. The negotiations were conducted by correspondence. The false representations which induced the plaintiff to transfer her land were numerous, among others that the land was worth twenty-five thousand dollars, and that the land was covered with timber, having at least five million two hundred thousand feet of timber of first-class quality, and, in addition thereto, other growing timber; that it was accessible to water transportation, and that when cleared the land was valuable for agriculture. The lands were more or less inaccessible and known as wild lands. At the time of the representations and transfer there was no timber on the land. Whatever timber there had been thereon had been burned off. The land was valueless for agriculture. The allegations by which plaintiff justifies her failure to discover the fraud from, the date of the transaction to October, 1916, and the circumstances concerning the discovery, are to the effect that during the negotiations leading up to the transfer the defendants sent a letter to her from one J. A. Wittrow, who signed himself as a “cruiser,” written upon the letter-head of the Bank of Galium County, Port Angeles, Washington, whose president subsequently acknowledged the signature to the deed which was delivered to plaintiff at the time of the transfer of the land to her. That by this representation so conveyed to her she was lulled into a false sense of security; that she was unacquainted with the basis upon which assessments were made for taxes in that neighborhood and that, therefore, the tax bills did not advise her of the fraud; that she was acquainted with lands in the vicinity of the lands in question and knew that they were timber lands containing valuable timber'; that she had bought the property as an investment for herself and children, and that the defendants knew that it was her desire to purchase the property for such purpose, and that she held the same as investment until 1916, when she had her brother investigate the. property. She alleges that from the time of the transaction till that date she was at all times in the state of Ohio and never in the state of Washington; although she had been in the state of Washington before or at the time of the transaction in question. Without considering other items of fraud alleged regarding the vicinity of the land to navigable water and its availability for agricultural purposes after it had been cleared, the question resolves itself into this: Was there anything in the situation that put the plaintiff on inquiry or required her to investigate the question as to whether or not the land had been denuded of its timber by fire before she acquired it? If the plaintiff had no knowledge whatever regarding the property, it might be said that the failure to investigate for twelve years and her reliance during all that period upon the assertions of strangers was inexcusable and at least came within the principles enunciated in Phelps v. Grady, 168 Cal. 75, [141 Pac. 926], [2] But the very fact that the plaintiff did know something of the surrounding lands, and did know that there were valuable timber lands and that the land in question was located in such a district, coupled with the fact that such land does not change its character and that under ordinary conditions the only result of a failure to examine the property for twelve years would be that the timber would have had that much more additional growth and be that much more valuable, tended to prevent any inquiry even by a careful person where it involved a long and expensive trip to a more or less inaccessible land. [3] It is a matter of common knowledge, of which the court will take judicial notice., that there are vast areas of timber land in the state of Washington. It is also claimed that the plaintiff did not sufficiently allege the facts concerning the discovery. [4] The real question, however, is whether or not plaintiff was justified in refraining from making any investigation until she sent her brother in 1916 to examine the property with a view to a sale of the timber thereon. If she was in fact ignorant of the fraud at that time, as she alleges; and as the demurrer admits, the allegation that she discovered the fraud through the investigation made by her brother at that time is a sufficient statement concerning the discovery. As was said in Phelps v. Grady, 168 Cal. 75, [141 Pac. 926], “every case of this sort must turn upon its particular facts,’’ and where the alleged fraud of the defendants consisted, among other things, of concealing from the plaintiff the fact that the timber had been entirely burned off the land in question, the plaintiff has sufficiently disclosed by the facts alleged in her complaint that she was not in any way put upon inquiry and that there was nothing to cause her in the exercise of ordinary diligence to examine the land in question, for the mere purpose of determining whether or not the timber that the defendant had represented was on the ground, and which she believed to be there was, in fact, there.

The judgment is reversed.

Lennon, J., and Melvin, J., concurred.