Smith v. Blachley

47 A. 985, 198 Pa. 173, 1901 Pa. LEXIS 753
CourtSupreme Court of Pennsylvania
DecidedJanuary 7, 1901
DocketAppeals, Nos. 106 and 107
StatusPublished
Cited by67 cases

This text of 47 A. 985 (Smith v. Blachley) is published on Counsel Stack Legal Research, covering Supreme Court of Pennsylvania primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Smith v. Blachley, 47 A. 985, 198 Pa. 173, 1901 Pa. LEXIS 753 (Pa. 1901).

Opinion

Opinion by

Mb. Justice Mitchell,

The general rule that statutes of limitation run from the act complained of in cases of tort as well as of contract, admits a well settled exception on account of fraud. The exception was not originally in the statutes themselves but was introduced by the courts acting upon principles of equity, though in many states (not, however, including Pennsylvania) the statutes have now been framed to cover and define the excepted cases explicitly.

But the limits of the exception and the circumstances under which it will be permitted have led to much conflict in the authorities. It is said in general that in cases of fraud the statute runs only from discovery, or from when with reasonable diligence there ought to have been discovery. But a distinction is made in regard to the starting point of the statute between fraud completed and ending with the act which gives rise to the cause of action, and fraud continued afterwards in efforts or acts tending to prevent discovery. On this distinction there are two widely divergent views. It is held on the one hand that the fraud though complete and fully actionable, nevertheless operates as of itself a continuing cause of action until discovery, while on the other hand it is held that when the cause of action is once complete the statute begins to run, and suit must be brought within the prescribed term, unless discovery is prevented by some additional and affirmative fraud done with that intent.

The United States courts have adopted the first view in treating the limitation of actions in the bankruptcy acts: Bailey v. Clover, 88 U. S. 343; Traer v. Clews, 115 U. S. 528. On the other hand in Troup v. Smith’s Exrs., 20 Johns. 33, it was [176]*176held that in a court of law the statute runs from the act “ whether there was a fraudulent concealment or not so as to prevent the plaintiff discovering the fraud,” and Chief Justice Spencer said that even in a court of equity the plaintiff must fail “ as the concealment of the fraud is not imputed to the testator. What he did was visible and what he neglected to do would or might have been discovered by repairing to the land.” This view appears to be still held in New York: Miller v. Wood, 116 N. Y. 851, and in other states. In many states, however, the decisions are so influenced by statutory provisions that they afford us little light on the subject as governed by the common law.

In England as late as 1882, the Queen’s Bench Division differed on the question. In Gibbs v. Guild, L. R. 8 Q. B. D. 296, the plaintiff declared for fraud by which he was induced to purchase stock which was worthless, and to the plea of the statute he replied that the defendant, in order to prevent the discovery of the fraud, had “ actively and deliberately concealed the same,” etc. On demurrer, Field,-J., gave judgment for the plaintiff, noticing specially this averment in the replication. On appeal the judgment was affirmed by two justices to one dissenting. The majority stated their conclusions in very broad terms without adverting to the replication and thereby leaving some doubt as to how far it was considered as material: Gibbs v. Guild, L. R. 9 Q. B. D. 59.

In Wood on the Limitation of Actions, the general rule is stated thus: “ The cause of action, except when the statute otherwise provides, in cases of fraud, arises from the time of its commission:” Sec. 275. “Something more than mere silence is necessary unless the relationship of the parties is such that the party is bound to speak ; it is necessary that some effort to conceal the fraud should have been made, either by preventing an investigation or by misleading the party making inquiry, or that misrepresentations were made by the party which were calculated to mislead him. In other words some affirmative acts to conceal the fraud must be shown.” Wood, sec. 276.

And in Darby & Bosanquet on Statutes of Limitations (2d ed.), 46, it is said, “In an action of deceit the statute will run from the date of the fraudulent act complained of, unless such fraud [177]*177has been actively concealed by the defendant,” referring to Gibbs v. Guild, L. R. 9 Q. B. D. 59, already cited, supra.

The cases in this state are not in harmony, and it is doubtful if they can be altogether reconciled, the difficulty being that the earlier ones were decided without reference to the distinction now under consideration. Jones v. Conoway, 4 Yeates, 109, was an action on the case as for deceit for selling plaintiff a negro man as a slave, and the court held that the statute only ran from the discovery of the fraud by the negro claiming and obtaining his freedom. Ferris v. Henderson, 12 Pa. 49, was a bill by a former slave for the value of his services, after he had become free by the failure to register him, and it was averred that the master by fraudulent concealment and threats had kept him in ignorance of his rights. The lapse of time was thirty-six years, and Lowrie, J., in the district court of Allegheny, dismissed the bill as too late. This court, however, reversed on the ground that the statute runs only from discovery of the fraud, and also fortified itself by taking into account the plaintiff’s condition of servitude and habit of submission. In Bricker v. Lightner, 40 Pa. 199, the defendant had given notes for money which he owed, and on the morning after the death of his creditor had stolen the notes from the desk where they were kept in the decedent’s room. It was held that the statute was no bar. All of these cases however were of the hard kind that are said to make bad law, and all of them were decided on the general proposition that in cases of actual fraud the statute runs only from discovery without any reference in any of them to the principle requiring affirmative acts of concealment after the fraud is complete.

On the other hand it has been repeatedly held that in an action against an attorney in fact or at law, to recover money collected and embezzled or not paid over, the statute runs from the date of collection and not from the time of discovery, unless the plaintiff has been misled or induced to delay by misrepresentations subsequent to the collection. In Glenn v. Cuttle, 2 Grant, 273, a case much quoted and relied on (also reported in 48 Pa. 524, as Campbell v. Boggs), it was held that the statute was a bar, and the principle was indicated, though not distinctly announced, that the rule would be different in case of subsequent active misrepresentations. In Fleming v. Culbert, [178]*17846 Pa. 498, nowever, it was expressly stated bythe same judge who had written the opinion in Glenn v. Guttle, that the statute runs from the collection, “ but if there be fraudulent concealment on the part of the attorney, as for example, if he gave false or evasive answers to the inquiries of his client or principal, the statute begins to run only from discovery of the fraud.” Subsequent cases of that class have all been decided expressly on that distinction which is now firmly settled: Morgan v. Tener, 83 Pa. 305; Wickersham v. Lee, 83 Pa. 416; Hughes v. First Nat. Bank of Waynesburg, 110 Pa. 428.

In the recent case of Sankey v. McElevey, 104 Pa. 265, this subject was very fully considered in an opinion by the late Chief Justice Gbeen. After referring to Bricker v. Lightner, Ferris v. Henderson and Wickersham v. Lee, supra, he cites Troup v. Smith, 20 Johns.

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Cite This Page — Counsel Stack

Bluebook (online)
47 A. 985, 198 Pa. 173, 1901 Pa. LEXIS 753, Counsel Stack Legal Research, https://law.counselstack.com/opinion/smith-v-blachley-pa-1901.