Roether v. National Union Fire Insurance Company, a Corp.
| Decision Date | 24 October 1924 |
| Citation | 200 N.W. 818,51 N.D. 634 |
| Court | North Dakota Supreme Court |
Appeal from the District Court of Hettinger County, N. Dak., before Berry, J.
Affirmed.
Jacobsen & Murray, for appellant.
"The general statement of the rule as to the effect of a fraudulent concealment of a cause of action, where such rule is applicable, is that when a party against whom a cause of action exists in favor of another, by fraud or concealment prevents such other from obtaining knowledge thereof, the statute of limitations will commence to run only from the time the cause of action is discovered or might have been discovered by the exercise of diligence." 25 C. J. 1213.
"The weight of authority, however, supports the contrary view and follows the rule which obtains in equity, under which such a concealment is a good reply to a plea of the statute of limitations." Cain v. Cook, 8 Cal. 449.
Sullivan Hanley & Sullivan, for respondent.
If we take the majority rule, we find that the gist of the fraud in such cases, "is not the breach of a promise, but the fraudulent intent of the promisor or obligor at the time he makes the promise or executes the contract, not to perform the same, and to deceive the obligee by his false promise."
"Hence to render nonperformance fraudulent the intention not to perform must exist when the promise is made, and if the promise is made in good faith when the contract is entered into there is no fraud though the promisor subsequently changes his mind and fails to or refuses to perform." 12 R. C. L. 262 and cases cited.
Sankey v McElevey, 104 Pa. 265, 49 Am. Rep. 575.
NUESSLE J. CHRISTIANSON and BIRDZELL, JJ., and JANSONIUS and COOLEY, Dist. JJ., concur. Mr. Chief Justice BRONSON and Mr. Justice JOHNSON, did not participate; Honorable CHAS. M. COOLEY, Judge of the First Judicial District and Honorable FRED JANSONIUS, Judge of the Fourth Judicial District, sitting in their stead.
This is an appeal from a judgment of the trial court dismissing the action on the ground that the causes of action alleged in the complaint are all barred by the statute of limitations.
Plaintiff brought suit to recover on account of damages to his crops. He held a policy of drought insurance issued on the 3rd of July, 1917, by the defendant company. In the first cause of action plaintiff alleges the payment of the premium, the execution and delivery of the policy, the damage to the crops and the amount thereof, notice of the loss in due time, the threshing of the crop, and the proceeds realized therefrom, the adjustment of the loss on November 1, 1917, in the sum of $ 751.50, and that no part of the same has been paid, except the sum of $ 597.60, leaving a balance due the plaintiff of $ 153.90. The foregoing allegations are incorporated by reference in the third and fourth causes of action.
Four causes of action are alleged in the complaint. It is, in effect, conceded by the plaintiff that the first and second causes are barred by the statute of limitations. The ruling of the trial court in that regard is manifestly correct.
The third cause of action is upon an unexecuted accord. All of the allegations of the first cause are made a part of the third. It is then alleged that the parties settled their differences as follows: that the plaintiff agreed to accept 79% as part payment of the adjustment of the loss; that the defendant promised and agreed with the plaintiff, that if it should pay other policy holders, either by agreement, or thru legal proceedings, a higher percentage, the plaintiff would be paid the same percentage upon his claim; that the defendant did pay other policy holders in full; and that the plaintiff is entitled to recover the balance of the adjustment accordingly, that is, the difference between $ 597.60 and the total amount of the loss as adjusted.
The fourth cause of action incorporates by reference all the allegations of the first and alleges a cause of action on the ground of fraud and deceit in inducing the plaintiff to sign a compromise settlement upon the false and fraudulent representation that the document presented to the plaintiff for his signature was merely a receipt, when, in fact, it was an agreement whereby the plaintiff released the defendant from all liability on account of the loss, in consideration of payment of 79% of the adjustment. It is further alleged that the plaintiff was induced by other fraudulent representations to sign the compromise settlement, to-wit: the representation, alleged to have been false, that the defendant was insolvent. Plaintiff further alleges that the defendant promised to pay him more, if other policy holders were paid a larger percentage and that other policy holders did, in fact, receive a larger percentage. It is alleged that the defendant made the promise aforesaid without any intention of performing the same; and that he did not discover the fraud and deceit until January 1, 1919. The fourth cause of action, therefore, is an action at law for fraud and deceit.
The complaint does not allege when payments were made to other policy holders on a larger percentage of the total loss than was paid this plaintiff. Neither is there any allegation in the complaint that the defendant did or said anything for the purpose of fraudulently concealing either or any cause of action. There is no allegation that the defendant in any manner concealed from the plaintiff the fact of its paying to other policy holders a larger percentage, or said or did anything intended to or that did in fact lull suspicion that such payment had been made; nor is the time when such payment was made alleged. There are additional allegations of fraud, but they all relate to the procuring of the assent of the plaintiff to the payment of the loss upon a basis less than 100%. The additional frauds alleged are not of such a character as would tend to conceal the accrual of a cause of action upon the unexecuted accord, or for fraud and deceit.
The cause was tried below on stipulated facts. It was agreed that the allegations of all of the causes of action should be taken as true for the purpose of determining whether any or all of them were barred by the statute of limitations. It is stipulated that the plaintiff was, at all times mentioned in the pleadings, a resident of Hettinger County, engaged in farming; that during all of the said times he was in communication with his neighbors and friends in the community where he lived, many of whom held policies of insurance similar to the one held by plaintiff; that he did his business at a certain bank in Mott, was well acquainted with its officers, with whom he frequently discussed his financial affairs; that on the calendar of the District Court for Hettinger County, for February, 1918, which began the 13th of February, 1918, there were at issue and for trial and were actually disposed of, seventy-seven (77) causes, brought by seventy-seven (77) different farmers and individuals, against the defendant in this law suit, upon policies of insurance identical with the one issued to the plaintiff herein; that at such term there were thirty-six (36) jurors in attendance from various parts of the county "some of which the plaintiff herein was personally acquainted with; that all of the plaintiffs in the seventy-seven cases hereinbefore referred to, resided in Hettinger County, a substantial majority of which plaintiffs were of the same nationality of this plaintiff, and spoke the same language as this plaintiff, and some of whom attended the same church as this plaintiff." It is further stipulated that much newspaper publicity was given to the affairs of the defendant company, in papers published in the English, German and Scandinavian languages, to the effect that the defendant was solvent and fully able to pay all just claims against it; that payments upon similar policies in the community of Mott, and upon similar claims, were made prior to the 14th of February, 1918, and that proofs of loss upon the policy in suit were made October 1, 1917, and prior thereto. It is stipulated that it was a matter of common knowledge in Mott, and in the neighborhood in which plaintiff resided, that the defendant company was not bankrupt and that it was able to pay all just legal claims.
The findings of the trial court follow substantially the allegations of the complaint and the facts stipulated by the parties. In addition, the court finds that the plaintiff could, and would, "by the use of reasonable diligence" have discovered "the untruth of the representations" and that the defendant was "guilty of the grievances alleged."
The plaintiff and appellant thus states the question at issue on this appeal:--"There is only one point involved on this appeal, to-wit: whether or not all of the causes of action are barred by the statute of limitations. . . ." Appellant contends that neither the third nor the fourth cause of action is barred by the statute. Appellant urges that these causes of action did not accrue "until the defendant communicated the facts to the plaintiff when it paid other policy holders more than what it paid the plaintiff." Appellant then says that "the defendant, by its fraudulent concealment, of the accruing of the cause of action, prevented the statute of limitations from commencing until the...
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