Williams v. Shrope

• Decision Date: 13 October 1917
• Citation: 30 Idaho 746,168 P. 162
• Court: Idaho Supreme Court
• Parties: MILFORD WILLIAMS, Respondent, v. JOHN SHROPE, FANNIE SHROPE and BRENNAN & DAVIS, Copartners, Appellants

168 P. 162

30 Idaho 746

MILFORD WILLIAMS, Respondent, v. JOHN SHROPE, FANNIE SHROPE and BRENNAN & DAVIS, Copartners, Appellants

Supreme Court of Idaho

October 13, 1917

MORTGAGE FORECLOSURE-FRAUD-STATUTE OF LIMITATIONS.

1. A cause of action for fraud and misrepresentation is barred in three years from the discovery thereof.

2. A knowledge of such facts as would put a reasonably prudent person upon inquiry is equivalent to a knowledge of the fraud and will start the running of the statute.

APPEAL from the District Court of the Fifth Judicial District, for Bear Lake County. Hon. J. J. Guheen, Judge.

Action for foreclosure of mortgage. Judgment for plaintiff. Affirmed.

Judgment affirmed, with costs to respondent as against the appellant John Shrope.

John A Bagley, for Appellants, cites no authorities on points decided.

A. B Gough and D. C. Kunz, for Respondent.

The defense and cross-action is for a rescission of the contract of sale. In such an action it must appear from the allegations that the party seeking to rescind is not guilty of laches. He must have acted promptly and without delay otherwise a ratification is presumed. (Elliott on Contracts, secs. 2430, 2431; Breshears v. Callender, 23 Idaho 349, 131 P. 15.)

An action for relief on the ground of fraud must be commenced within three years after the commission of the fraud or the discovery thereof. (Sec. 4054 (4), Rev. Codes.)

An irrigation district is a public corporation, and all of the inhabitants thereof are chargeable with notice. (Little Willow Irr. Dist. v. Haynes, 24 Idaho 317, 133 P. 905.)

COWEN, District Judge. Morgan and Rice, JJ., concur.

OPINION

COWEN, District Judge.

This action was commenced by the respondent, Williams, to foreclose a mortgage given him by the appellants, John Shrope and wife, as security for the payment of a note for the sum of $ 1,750, dated July 26, 1910, and due in three years from date. The complaint was filed January 9, 1915. The appellants filed answer to the complaint in foreclosure July 12, 1915, wherein they admit the execution of the note and mortgage, but allege that the same were given as the balance due upon the purchase price of the land described in the mortgage. They allege that the respondent sold the lands in question to them in July, 1910, for the agreed purchase price of $ 2,700, they paying the sum of $ 1,000 in cash therefor, and giving the note and mortgage for the balance.

The appellants then allege that their purchase of the lands was induced by false and fraudulent representations on the part of the respondent in guaranteeing and representing the lands to be free and clear of liens and encumbrances, when, as a matter of fact, they allege the same were in an irrigation district which then had a bonded indebtedness existing against it of $ 98,000, which, they say, was not shown on the abstract of the lands furnished them and of which fact they had no knowledge at the time of the sale. They further state that they discovered the fact in 1913, and thereupon tendered the return of the lands and demanded that the note and mortgage be canceled and their $ 1,000 restored to them. They then reallege the foregoing facts by way of cross-complaint and pray for judgment against the respondent for $ 1,000 and interest and for such cancelation, and set up a second cross-action for $ 350 for improvements made upon the lands; also a third cross-action for the sum of $ 26.65. They allege they paid to the irrigation district the sum of $ 26.65, which was a "lien and encumbrance on this land by reason of its being in said district, to pay interest on said bonds and pay expenses of the district."

The respondent demurred to the answer and cross-complaint on the ground, among others, that the defense pleaded therein was barred by the provisions of ...