Crawford v. Crawford

• Decision Date: 23 February 1910
• Parties: CRAWFORD v. CRAWFORD (two cases).
• Court: Georgia Supreme Court

67 S.E. 673

134 Ga. 114

CRAWFORD v. CRAWFORD (two cases).

Supreme Court of Georgia

February 23, 1910

Syllabus by the Court.

The fact that the plaintiff and the defendant are brothers does not of itself create a confidential or fiduciary relation between them. There is no presumption that such relation exists between brothers solely from the fact that they are so related. If a confidential or fiduciary relation exists between brothers, it must be shown by proof; and the burden is upon the party asserting the existence of such relationship to affirmatively show the same.

Where one practices upon another fraud and deceit, whereby the latter is induced to accept property in settlement of a debt much greater in amount than the value of the property, an injury is done to property and not to the person, and the statute of limitations in reference to actions for injuries to property applies.

Where an action is brought to recover damages alleged to have resulted to the plaintiff in consequence of the perpetration of fraud charged to have been practiced upon him by the defendant, the cause of action, as stated in the declaration being apparently barred by the statute of limitations, and it is sought to relieve such action of the bar of the statute by alleging that it was brought within the statutory period after the discovery of the fraud, if it does not appear from the petition that the plaintiff used proper diligence to discover the fraud, the petition should be dismissed upon appropriate demurrer thereto.

Error from Superior Court, Fulton County; W. D. Ellis, Judge.

Action by T. J. Crawford against J. M. Crawford. Judgment of nonsuit and plaintiff brings error, defendant filling cross-exceptions. Main bill of exceptions dismissed. Reversed on cross-bill of exceptions.

Where an action for fraud is apparently barred by limitation, and it is sought to relieve the action of the bar by alleging that it was brought within the statutory period after discovery of the fraud, the petition must show that plaintiff used proper diligence to discover the fraud.

The plaintiff brought suit against the defendant, making substantially the following allegations: They are brothers and were born and reared in the same county. The defendant is six years older than the plaintiff. The plaintiff came to Atlanta in 1892, and the defendant a number of years prior thereto, both for the purpose of engaging in the practice of medicine. Prior to the plaintiff's removal to Atlanta he loaned the defendant, in 1890 or 1891, $2,500, and took his note for the same. After such removal, he loaned the defendant various other sums until January 1, 1896, which at that time, with the prior loan, aggregated $5,000, on which date the defendant gave the plaintiff a note for $5,000, due one day after date. The defendant asked the plaintiff to deal in stocks, with the latter's money, with the understanding that the defendant would sustain the losses and they would equally divide any profits made. During the first six months of 1895 the plaintiff invested in stocks for a short time and made profits of $70, one-half of which was paid to the defendant. Later on plaintiff lost $800, which defendant refused to pay, and has never paid. During the summer of 1896 defendant repeatedly told plaintiff's wife that "he was badly involved financially; that he intended to let his creditors take his property, for the reason that he was unable to pay what he owed." Plaintiff went to defendant on or about October 12, 1896, for the purpose of collecting the money due him. Defendant told plaintiff that "he owed large sums of money that he was unable to pay; that he was insolvent, and would lose everything that he had;" that defendant's wife owned a lot covered by a mortgage to secure $2,000, which she would convey in settlement of the indebtedness; and that, if plaintiff did not accept this proposition, he would lose such indebtedness. Plaintiff was raised with defendant, and had gone to school to the defendant, and had implicit confidence in him. Plaintiff accepted the proposition, and on or about October 12, 1896, defendant's wife conveyed the lot to plaintiff's wife; the latter assuming the mortgage thereon. The lot was worth $3,500, less the amount secured by the mortgage, and plaintiff received only $1,500, less $35 interest paid on the debt secured by the mortgage. Defendant at the time of the conveyance stated that there was $35 interest due on the note secured by the mortgage, and that he did not have the money with which to pay the same; and it was paid by the plaintiff. Plaintiff continued to rely on and believe the statements of the defendant until September, 1903. "Petitioner alleges that he continued to rely on and believe the statements of said defendant hereinbefore alleged and set forth, until September, 1903, when he went to defendant, knowing that he had been successful, and believing that he had emerged from the insolvency which he had declared to petitioner was hanging over him in 1896, and demanded of the said defendant the payment of the said balances due him. There were a number of conferences between defendant and petitioner. Your petitioner urged that he was entitled to the full payment of the money due him, and recalled the statements which defendant had made at the time of the settlement. Finally negotiations and conferences came to an end, when defendant denied that he had represented himself to be insolvent, and stated to your petitioner that he was 'twenty-one,' meaning that your petitioner was 21 years of age at the time of said settlement. For the first time petitioner's confidence in defendant was shaken. Petitioner had never doubted defendant's statements, nor the claim that he was insolvent in 1896, until he denied having made the statements. Your petitioner then employed an attorney and investigated the financial condition and responsibility of the defendant in 1896, when he claimed to be insolvent and unable to pay his debts. The result of this investigation disclosed to your petitioner for the first time since the settlement was made that said defendant was solvent and able to pay all he owed, including his indebtedness to petitioner, at the time he claimed to be insolvent and unable to pay. Petitioner's attorney then took the matter up with defendant, and finally an agreement to arbitrate the matter was reached. Petitioner's counsel prepared a submission to arbitration in writing, which was satisfactory to petitioner, and presented the same to defendant for his signature. Said defendant refused to go further with the arrangement, saying that he had been advised by his attorney that the claims of petitioner were barred by the statutes of limitations. Petitioner avers that each and every statement made by defendant to petitioner's wife as hereinbefore alleged was false when made, and was known by said defendant to be false, and that said statements were made for the purpose of having them repeated to your petitioner, and to create alarm upon his part concerning the money due him by said defendant. Your petitioner alleges that the statements made to him by defendant that he was owing large sums of money, that he was insolvent and unable to pay what he owed and that he would lose everything he had, and that your petitioner would lose what defendant owed him unless he accepted the property aforesaid in settlement, were false when made, and defendant knew that they were false when made. Said statements were made for the purpose of deceiving and defrauding your petitioner, and did deceive and defraud him. As a result of the aforesaid false and fraudulent statements, your petitioner was defrauded, injured, and damaged to the amount and value of $4,335; that at the time of said settlement defendant was due petitioner the principal sum of $588; that in said settlement he received property of the value of $1,500 only; that the statement of defendant that he was unable to pay the interest on the note was false, and was made as a part of the scheme and plan adopted by defendant to deceive and defraud your petitioner. Petitioner alleges that J. M. Crawford was solvent on the 1st day of January, 1896; that he has been solvent at all times since said date, and that he is solvent now; that defendant did not owe large sums of money which he was unable to pay in October, 1896; that he was able to pay all he owed on said date; and that he took advantage of your petitioner, and of their relations of confidence, friendship, and relationship which had existed from childhood. Petitioner alleges that on the 12th day of October, 1896, defendant did owe sums of money, but how much and to whom your petitioner does not know; but your petitioner alleges that said defendant was able to pay all such sums, and that he did pay all such sums in full, and that he did not let his creditors take his property because he was unable to pay what he owed at the time, but that he retained his property and paid all he owed. Since the fall of 1903, when your petitioner first discovered the frauds herein alleged, numerous conferences have occurred between defendant and petitioner regarding the matter, and that on the 17th day of October, 1906, they entered into an agreement to arbitrate all differences of a financial nature between them; that the matters herein complained of comprise all differences of a financial nature between defendant and himself; and that the agreement or submission was entered into for the purpose of submitting these matters to arbitration. Petitioner attaches a copy of said submission hereto, marked 'Exhibit A,' and makes the same a part of this petition. Petitioner alleges that he has fully complied with the terms of said submission, that he selected an arbitrator within the...