Gordon v. Anderson

• Decision Date: 17 June 1907
• Docket Number: 12,690
• Citation: 44 So. 67,90 Miss. 677
• Court: Mississippi Supreme Court
• Parties: ROBERT A. GORDON v. BENJAMIN D. ANDERSON

44 So. 67

90 Miss. 677

ROBERT A. GORDON v. BENJAMIN D. ANDERSON

No. 12,690

Supreme Court of Mississippi

June 17, 1907

FROM the chancery court of Pontotoc county, HON. JOHN Q. ROBINS chancellor.

Anderson appellee, was complainant in the court below; Gordon appellant, was defendant there. From a decree partly in complainant's favor defendant appealed to the supreme court and complainant prosecuted a cross- appeal.

The facts are fully stated in the opinion of the court.

Case affirmed, reversed and bill dismissed.

R. V Fletcher, Brame & Brame, and Williams & Bates, for appellant and cross-appellees.

In view of the long lapse of time after the deed to Gordon was recorded and after proof of actual notice thereof on the part of Ezell it was incumbent on Anderson, the complainant (who purchased from Ezell only a short while before suit) to prove not only that he was ignorant of the fraud but that Ezell was ignorant of it and could not have discovered it by the exercise of reasonable diligence. Peck v. Bank, 7 L. R. A., 726, and note. There is absolutely no proof on this subject.

It is not pretended that Gordon was guilty of any affirmative act or line of conduct which would mislead or deceive the other party. Nor was there any relation of confidence which required him to make any report or to furnish information. The parties were at arm's length and so dealt with each other. The judgment creditor himself, being the aggressor, had proceeded to have the land sold under his execution nineteen years before the bill in this case was filed. He could only sell the land under execution upon the theory that the conveyance to Gordon was fraudulent and subject to be decreed void, and the record shows that he had full knowledge of his rights and took steps to enforce the same in 1886, but afterwards abandoned the matter and nothing further was done until the bill was filed in 1905, three days after Anderson appeared on the scene. It is difficult to conceive a stronger case against the application of the doctrine of concealed fraud. The established doctrine is that not only must it be shown that there was a concealed fraud, but the creditor must show that it could not have been discovered by reasonable diligence on his part. Buckner v. Calcote, 28 Miss. 432; State v. Furlong, 60 Miss. 839; Hudson v. Kimbrough, 74 Miss. 341, S.C., 20 So. 885; Jones v. Rogers, 85 Miss. 802, S.C., 38 South, 742; Thornton v. Natchez, 88 Miss. 1, S.C., 41 So. 498. In the last mentioned case, referring to § 2731 of the Code, this court said:

"If we could imagine a concealed fraud, then clearly under the same section, with reasonable diligence it might have been first known or discovered, before the statute began to run. Under this section, 2731, and sections 2749-2762, we hold the bar complete. Barkery v. Barrows, 138 Mass. 578; Elder v. McCloskey, 70 F. 529, 17 C. C. A., 251."

Inasmuch as our position is thoroughly sustained by the decisions of this court, we hardly feel at liberty to cite other authorities, but on the general subject we refer to 19 Ency. L., pp. 250 and 251, and the many cases there cited. See also the note in Miller v. Powers, 4 L. R. A., 483.

"If it appears that the party has knowledge or information of facts sufficient to put a prudent man upon inquiry, and that he wholly neglects to make any inquiry, or having begun, fails to prosecute it in a reasonable manner, the inference of actual notice is necessary and absolute." Peck v. Bank, 7 L. R. A., 827, and numerous authorities cited, including Mississippi cases.

After long delay, necessity for complainant to allege and show clearly reasons for not proceeding earlier, see March v. Whitmore, 21 Wall., 185; Teall v. Slaven, 40 F. 774; and many cases there cited.

Even if we should be wrong in our contention that the right to attack the conveyance was lost by delay of nearly twenty years after the parties had notice, we deny that under the facts shown by this record there was any concealed fraud.

There is no evidence whatever of any agreement to keep the facts relating to the conveyance secret, and in truth there was no secrecy except in relation to the mere matters concerning the consideration of the deed. In the case of State v. Furlong, 60 Miss. 839, this court, in answer to the argument that the sheriff who was charged with fraud in that case, occupied a relation of trust and confidence, said:

"We cannot say that any relation of trust and confidence existed between him and the state. Where no such relation exists, where the reasonable diligence would have revealed, and where there has been no affirmative conduct or declaration calculated to lull suspicion, no fraudulent concealment within the meaning of the law has been made out. Calcote v. Buckner, 28 Miss. 432."

There must be some affirmative action or line of conduct to constitute a fraudulent concealment. A mere passive silence does not amount to such concealment. Churchmen v. Indianapolis, 100 Ind. 259; Miller v. Powers, 119 Iowa 79.

There is a wide and fatal gap in complainant's case. He offered no evidence whatever to show that either he or his grantor, Ezell, were ignorant of the alleged fraud, or that it could not be discovered, or that any diligence at all was exercised. This ought to be the end of the case. Jones v. Rogers, 85 Miss. 802, S.C., 38 So. 742.

Fontaine & Fontaine, and Thomas J. Buchanan, for appellee and cross-appellant.

The decided weight of authority in equity is, that where relief is asked on the ground of actual fraud, especially if such fraud is concealed, time will not run in favor of the defendant until the discovery of the fraud, or until with reasonable diligence it might have been discovered. Kimberly v. Lake Shore, etc., R. R. Co., 120 U.S. 136; and authorities cited.

And our statute provides: "In every case of concealed fraud the right of any person to bring suit in equity for the recovery of land of which he or any person through whom he claims may have been deprived by such fraud shall be deemed to have first accrued, at and not before the time which the fraud shall, or with reasonable diligence, might have been first shown or discovered." Code 1892, § 2731; Thornton v. Natchez, 88 Miss. 1, S.C., 41 So. 498.

To hold that by concealing a fraud, or by committing a fraud in a manner that it conceals itself, until such time as the party committing the fraud could plead the statute of limitations to protect it, is to make the law which was designed to prevent fraud, the means by which it is made successful and secure. Bailey v. Glover, 21 Wall. U.S. 349.

The adverse possession of defendant, Gordon, has nothing to do with the question or with the operation of this particular statute. Code 1892, § 2731. The point in the case is has complainant brought his suit within the time limited by the statute, after his cause of action accrued.

To prevent this statute from beginning to run, complainant must allege: (1) Fraud and the facts constituting it; (2) that the acts of fraud were committed by the defendant, or some one in privity with him: (3) that they were concealed from complainant by defendant or his privies; (4) that complainant did not discover, or know of this fraud over ten years before instituting his suit; (5) he must also allege and show that he exercised reasonable diligence to discover it sooner, or that he could not with reasonable diligence have discovered it sooner. 19 Am. & Eng. Ency. L., 242; 3d paragraph; Jones v. Rogers, 85 Miss. 836, S.C., 38 So. 742; Alabama, etc., R'y Co. v. Thomas, 86 Miss. 27, S.C., 38 So. 770.

All of these facts are alleged in complainant's bill in this case. And as a matter of fact the chancellor found that they had all been fully established by the testimony which was ample, which finding of the chancellor on the facts is analogous to the finding of a jury.

Argued orally by L. Brame, for appellant, and T. J. Buchanan, for appellee.

OPINION

CALHOON, J.

On February 27, 1905, Anderson filed his bill against Gordon to cancel a conveyance executed by L. J Staten to Gordon on December 21, 1885, on the ground that it was...