Thomas v. Gordon

• Decision Date: 24 April 1948
• Docket Number: 7422
• Citation: 68 Idaho 254,192 P.2d 856
• Parties: THOMAS v. GORDON et al
• Court: Idaho Supreme Court

192 P.2d 856

68 Idaho 254

THOMAS v. GORDON et al

No. 7422

Supreme Court of Idaho

April 24, 1948

Appeal from District Court, Sixth District, Bingham County; Guy Stevens, Judge.

Affirmed.

McCall & Thatcher, of Salmon, for appellant.

It is immaterial that the plaintiff charges the defendants with fraud, since the statements of fraud do not constitute the gravamen of the complaint but are made as a matter of inducement.In such case the fraud can be considered only as a fact or condition justifying the rescission.55 Am.Jur 924, sec. 531, supra;Stout v. Caruthersville Hardware Company,131 Mo.App. 520, 110 S.W. 619;Minor v Balbridge, 123 Cal. 187, 55 P. 783.

The action to recover the money paid under the contract is based upon a new and entirely different contract, one implied by law for the purpose of enabling a defrauded party to obtain a return of any money or property unjustly retained by the defendant.12 Am.Jur. 636, sec. 143;Hall v. Bankers Trust Company,101 Colo. 449, 74 P.2d 720;Breshears v. Callender,23 Idaho 348, 131 P. 15;Philpott v Superior Court,1 Cal.2d 512, 36 P.2d 635, 95 A.L.R. 990;MacLeod v. Stelle,43 Idaho 64, 249 P. 254;Security Finance Co. v. Jensen Auto Co.,48 Idaho 376, 282 P. 88.

The statute of limitations applicable to such actions is that prescribing the time to sue upon contracts, obligations or liabilities not founded upon instruments in writing.34 Am.Jur. 77, sec. 93;37 C.J. 772, sec. 107;Pacific Coal & Lumber Co. v. Pierce County,133 Wash. 278, 233 P. 953;Boston Safe Deposit & Trust Co. v. Boyd et al.,139 Kan. 411, 32 P.2d 218, 92 A.L.R. 1355;Ihrke v. Cont. Life Ins. & Inv. Co.,91 Wash. 342, 157 P. 886, L.R.A.1916F, 430;Hall v. Bankers Trust Co., supra.

Robert M. Kerr, Jr., of Blackfoot, for respondent.

The appropriate statute of limitations is determined by the substance and not by the form of the action.If the plaintiff seeks relief from or on account of a fraud or mistake, the action must be brought within three years of the discovery, by the aggrieved party, of the facts constituting the fraud or mistake.MacDonald v. Reich & Lievre,100 Cal.App. 736, 281 P. 106, 107;Common School District No. 18 v. Twin Falls B. & T. Co., 52 Idaho 200, 12 P.2d 774;Hillock v. Idaho Title & Trust Co.,22 Idaho 440, 126 P. 612, 42 L.R.A.,N.S., 178;Pacific National Bank v. Corona National Bank, 113 Cal.App. 366, 298 P. 144.

Givens, Chief Justice.Budge, Holden, Miller, and Hyatt, JJ., concur.

OPINION

Givens, Chief Justice.

November 12, 1942, appellant and respondents entered into a written contract for the sale by respondents to appellant of certain real property for $ 500.00 then paid, further payments and the assumption of a mortgage in favor of the Federal Land Bank of Spokane.

January 26, 1943, appellant, claiming respondents had fraudulently and falsely represented there were no past due payments on said mortgage at the time of the contract, ascertained there were and being unable to pay them and the required payment under the contract, gave written notice of rescission and demanded the return of the $ 500.00.

Respondents not complying with such repayment request, appellant brought suit November 9, 1946, to recover the $ 500.00.The trial court sustained respondents' demurrer on the ground appellant's action, though in form on a common money count based on rescission, was in substance for relief on the ground of fraud, and since it appeared upon the face of the amended complaint that it had been brought more than four years after the rescission, was barred by Section 5-218, subd. 4, I.C.A. ^[1]

Appellant contends his action is on a common money count based on the implied contract to repay arising from the rescission and therefore as to limitation is governed by Section 5-217, I.C.A. ^[2]

Conceding the tort may be waived, Davidson Grocery Co. v. Johnston,24 Idaho 336, 133 P. 929, Ann.Cas.1915C, 1129, and suit be brought on an implied contract to recover money which in equity and good conscience respondents should not retain, Ex parte Williams, 63 Okl.Cr. 395, 75 P.2d 904, 907; also that appellant could rescind by notice and need not sue for rescission, Gamblin v. Dickson,18 Idaho 734, 112 P. 213, and suit for recovery of consideration on such rescission is an alternate remedy, Breshears et al. v. Callender,23 Idaho 348, 131 P. 15; to justify and sustain rescission, appellant must prove the fraud which he had to allege, Moser v. Pugh-Jenkins Furniture Co.,31 Idaho 438, 173 P. 639, L.R.A.1918F, 437.

This court early committed itself and has adhered to the doctrine that the substance, not the form of the action, controls and determines the applicable statute of limitations.Hillock v. Idaho Title & Trust Co.,22 Idaho 440, 126 P. 612, 42 L.R.A.,N.S., 178.

The only basis or ground for recovery is the fraud.Fraud, therefore, is the gravamen of the action and is not merely incidental.Independent School Districts etc. v. Common School Dist. No. 1,56 Idaho 426, 55 P.2d 144, 105 A.L.R. 1267.

The precise point herein was thoroughly investigated, discussed, and after a completely comprehensive review of applicable authorities, rejected in Common School Dist. No. 18 v. Twin Falls Bank & Trust Co., 52 Idaho 200, 12 P.2d 774.This court has twice followed and affirmed the doctrine of the above case in Trimming v. Howard,52 Idaho 412, 16 P.2d 661, andDavidson v. Davidson,68 Idaho 58, 188 P.2d 329.That case, therefore, is completely controlling and it is unnecessary to again consider the point -- it being sufficient to advert to a few authorities not noted therein, which in substance tend to sustain the ruling therein and respondents' position.^[3]

Appellant slept upon his rights and by his own laches has lost the right to recover the down payment.

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