Ruff v. Milner

92 Mo. App. 620, 1902 Mo. App. LEXIS 512

• Court: Missouri Court of Appeals
• Decided: February 25, 1902
• Status: Published

Opinion

BLAND, P. J.

I. Tbe plea of general denial and the plea of release in bankruptcy are not inconsistent pleas. Evidence tending to prove either one of these pleas would not tend to disprove the other and for this reason they are not inconsistent. Nelson v. Broadhack, 44 Mo. 596; Crowder v. Searcy, 103 Mo. 97; Fisher v. Stevens, 143 Mo. 181; Quigley v. Bambrick, 58 Mo. App. 193; Cox v. Bishop, 55 Mo. App. 135.

II. The foreclosure was made on October 17, 1900. The knowledge of this fact was not brought home to plaintiff until on or about the fourth or fifteenth day of December, 1894. The suit was commenced on December 2,1899, so that less than ten years had elapsed from the commission of the fraud and embezzlement by the conversion of the money, and less than five years from the obtention of the knowledge by plaintiff of the fraud and crime of Milner, before the suit was brought.

The action being predicated upon a positive fraud comes within the fifth subdivision of section 4273, Revised Statutes 1899 (known as the five-year statute), with respect to the running of the statute of limitations. This subdivision reads, “An action for relief on the ground of frarrd, the cause of action in such case to be deemed not to have accrued until the discovery by the aggrieved party, at any time within ten years, of the facts constituting the fraud.” Hyatt v. Wolfe, 22 Mo. App. 191; Hunter v. Hunter, 50 Mo. 445; Bent v. Priest, 86 Mo. 475.

Milner, in the capacity of trustee in the deed of trust, held the title in trust for plaintiff. It was this title that he disposed of at the foreclosure sale. He was the trustee of an express trust and the statute of limitations did not run as he never denied the trust. Smith v. Ricords, 52 Mo. 581; Ricords v. Watkins, 56 Mo. 553; Shelby Co. v. Bragg, 135 Mo. 291. We conclude, therefore, that the plaintiff’s claim is not barred by the statute of limitations.

HI. Debts created by fraud, embezzlement, misappropriation or defalcation while acting as an officer or in any fiduciary capacity are not affected by the discharge of the bankrupt. Sec. 17 of the Bankruptcy Act. Milner, in making the sale and receiving the money bid thereat, acted as the agent of plaintiff and the money came into his hands by virtue of his employment as her agent. This money, according to his own statement and evidence, he spent for his private purposes and concealed the fact from plaintiff. He not only committed a positive fraud as a fiduciary, but was guilty also of embezzlement under our statute defining that offense. Sec. 1912, R. S. 1899. His discharge in bankruptcy did not, therefore, affect the plaintiff’s claim because it originated in embezzlment in a fiduciary capacity and in the commission of felony. Strang v. Bradner, 114 U. S. 555; Ames v. Moir, 138 U. S. 306; Bracken v. Milner, 5 Am. Bankruptcy Rep. 23.

"We conclude that the learned circuit judge should have given the declarations of law asked by plaintiff and should have found the issues for her. The evidence is clear and in fact is admitted by the defendant that he received the thre.e thousand two hundred and thirty dollars on the sale of the Teague tract of land; that the money belonged to plaintiff and that he converted it to his own use. In this state of the case we reverse the judgment and direct the circuit court to enter judgment for plaintiff for three thousand two hundred and thirty dollars with six per cent interest thereon per annum from October 17, 1900.

Barclay, J., concurs; Goode, J., not sitting.