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evidence. "Length of time," said STORY, J., "necessarily obscures all human evidence; and as it thus removes from the parties all the immediate means to verify the nature of the original transaction, it operates by way of presumption in favor of innocence and against the imputation of fraud.” 2 The reason why, if fraud has been concealed by one party, and until it has been discovered by the other, the statute should not operate as a bar, is, that it ought not in conscience to run: the conscience of the party being so affected that he ought not to be allowed to avail himself of the length of time. In many of the States, a certain period after the discovery of the fraud is fixed within which an action for relief must be brought; but where no period is fixed a delay beyond the statutory period will be fatal.

In a case in the Supreme Court the court said: "In suits in equity where relief is sought on the ground of fraud, the authorities are without conflict in support of the doctrine that where the ignorance of the fraud has been produced by affirmative acts of the guilty party in concealing the facts from the other, the statute will not bar relief, provided suit is brought within a proper time after the discovery of the fraud. We also think that in suits in equity the decided weight of authority is in favor of the proposition that where a party injured by the fraud remains in ignorance of it, without any fault or want of diligence or care on his part, the bar of the statute does not begin to run until the fraud is discovered, though there be no special circumstances on the part of the party committing the fraud to conceal it from the knowledge of the other party. . . . To hold that by concealing fraud or by committing a fraud in a manner that concealed 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." 5

In a more recent case in the United States Supreme Court," HARLAN, J., says: "It is an established rule of equity, as administered in the courts of the United States, that where relief is asked on the ground of actual fraud, especially if such fraud has been 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." 7

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And it seems that in the United States courts the equity jurisdiction

1 Charter v. Trevelyan, 4 L. J. N. s. Ch. 239, 11 Cl. & Fin. 714; Bonney v. Ridgard, cited in 17 Ves. 97.


2 Prevost v. Gratz, 6 Wheat. (U. S.) In the Marquis of Clanricarde v. Henning, 30 Beav. 175, a bill to impeach a purchase by a solicitor from his client was considered too late after a lapse of more than forty years.

4 21 Wall. U. S. 347.

Traer v. Clews, 115 U. S. 338. Kirby. Lake Shore, &c. R. R. Cc., 120 U. S. 130.

7 Kneeder v. Norton, 11 Wall. (U. S.) 442; Prevost v. Gratz, 6 Wheat. (U. S.) 481; Michoud v. Girod, 4 How. (U. S.) 503; Vesey v. Williams, 8 id. 149; Brown v. Buena Vista, 95 U. S. 157; Rosenthal v.

3 LORD REDESDALE, in Hovenden v. Walker, 111 U. S. 190. Annesley, ante.

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of those courts is not subject either to limitation or restraint by State legislation, and is uniform throughout the different States of the Union.1 In a case previously cited,2 HARLAN, J., in commenting upon this question, says: "We have repeatedly held that the jurisdiction of the courts of the United States over controversies between citizens of different States cannot be impaired by the laws of the States, which prescribe the modes of redress in their courts, or which regulate the distribution of their judicial power.' If legal remedies are sometimes modified to suit the changes in the laws of the States, and the practice of their courts, it is not so with equitable. The equity jurisdiction of the courts of the United States is the same that the High Court of Chancery in England possesses, is subject to neither limitation nor restraint by State legislation, and is uniform throughout the different States of the Union.3

In view of these authorities it is clear that the statute of New York upon the subject of limitation does not affect the power and duty of the court below following the settled rules of equity to adjudge that time did not run in favor of defendants, charged with actual concealed fraud, until after such fraud was or should with due diligence have been discovered. Upon any other theory the equity jurisdiction of the courts of the United States could not be exercised according to rules and principles applicable alike in every State. It is undoubtedly true, as announced in adjudged cases, that courts of equity feel themselves bound, in cases of concurrent jurisdiction, by the statutes of limitation that govern courts of law in similar circumstances, and that sometimes they act upon the analogy of the like limitation at law. But these general rules must be taken subject to the qualification that the equity jurisdiction of the courts of the United States cannot be impaired by the laws of the respective States in which they sit. It is an inflexible rule in those courts, when applying the general limitation prescribed in cases like this, to regard the cause of action as having accrued at the time the fraud was or should have been discovered, and thus withhold from the defendant the benefit, in the computation of time, of the period during which he concealed the fraud.

It results that even if this be not an action "to procure a judgment, other than for a sum of money, on the ground of fraud," within the meaning of the New York Code of Procedure, the limitation of six years, being applied here, does not, as adjudged below, commence from the commission of the alleged frauds.

In Burke v. Smith, where the local statute prescribed six years for the commencement of actions for fraud, the court, after observing that equity acts or refuses to act in analogy to the statute, said: "We think

1 Robinson v. Campbell, 2 Wheat. U. S. 290; Boyle v. Zachary, 6 Pet. (U. S.) 658; Livingston v. Story, 9 id. 656; Stearns v. Page, 7 How. (U. S.) 819; Russel v. Southard, 12 id. 147; Neves v. Scott, 13 id. 272;

Barber v. Barber, 21 id. 572; Green v.
Creighton, 23 id. 105.

2 Kirby v. Lake Shore, &c. R. R. Co., ante.
8 See note 7, p. 706.

416 Wall. (U. S.) 401.

a court of equity will not be moved to set aside a fraudulent transaction at the suit of one who has been quiescent during a period longer than that fixed by the statute of limitations, after he had knowledge of the fraud, or after he was put upon inquiry with the means of knowledge accessible to him." Without inquiring whether the plaintiff was not guilty of such gross laches, in applying for relief, as deprived him of all right to the aid of equity, and giving him the benefit of the limitation of six years, to be computed from the discovery of the fraud, there seems to be even then no escape from the conclusion that the suit was not brought in time. Seven years, lacking only seven days, elapsed after the discovery of the frauds by the plaintiff's testator before suit was brought.

SEC. 276. Instances in which the Statute will not run until Fraud discovered. - In order to avail himself of the rule as to concealed fraud, to excuse delay in bringing an action, the bill or complaint should set forth the nature of the transaction fully, and also the acts of concealment, and the time of its discovery.1

The provision that if a person liable to an action shall conceal the fact from the knowledge of the person entitled thereto, the action may be commenced at any time within the period of limitation after the discovery of the cause of action, applies to causes of action for fraud, as well as to other causes of action; but the concealment contemplated by the statute is something more than mere silence: it must be of an affirmative character, and must be alleged and proved so as to bring the case clearly within the meaning of the statute.

1 State v. Giles, 52 Ind. 356.

If at the time of the discovery of a fraud, the party injured has a legal capacity to act and to contract, his right of action accrues and the statute of limitations begins to run against it, irrespective of the degree of intelligence possessed by him, or of his freedom from undue influence, or his ability to resist it. The fact, therefore, that the person injured was, after a discovery of fraud, induced by other fraudu lent representations, or by undue influence, to refrain from prosecuting until the time limited by the statute has expired, is no answer to a plea of the statute. It must be made to appear that at the time of the discovery he had not the legal capacity to act. Therefore, it was held, where the owner of real estate was induced to convey the same by fraudulent representations and undue influence on the part of the grantee, and after discovery of the fraud commenced an action against the grantee to set aside the conveyance because thereof, but was

Something more

induced by further fraudulent misrepresentations and undue influence to discontinue the same, that another action to set aside said conveyance, commenced more than ten years after the discovery of the original fraud, was barred by the statute.

Piper v. Hoard, 107 N. Y. 67.

2 Wynne v. Cornelison, 52 Ind. 312; Township of Boomer v. French, 40 Iowa, 601; Stanley v. Stanton, 36 Ind. 445. A request by one of two indorsers of a note that suit be delayed against him, or that the other indorser be sued first, is no case for the interference of a court of equity. Bank of Tenn. v. Hill, 10 Humph. (Tenn.) 176. So where, in an account settled between the parties, the plaintiff has erroneously credited the defendants with an amount which, for that reason, he would be entitled to recover. Brown v. Edes, 37 Me. 492. Nor is a denial on the part of the defendant, that he was part owner in a vessel, made when a portion of an account for repairs was presented to him,

than mere silence is necessary, unless the relationship of the parties is such that the party is bound to speak; it is necessary that some effort to conceal the fraud should have been made, either by preventing an investigation, or by misleading the party making inquiry, or that misrepresentations were made by the party which were calculated to mislead him. In other words, some affirmative acts to conceal the fraud must be shown,2 and, according to the case last cited, the party seeking to avoid the statute must have exercised proper diligence.3 Mere silence or passiveness, there being no fiduciary relation or act of the party calculated to deceive or lull inquiry, is not a fraudulent concealment within the meaning of the statute.* The rule that the

such a fraudulent concealment as to prevent him from availing himself of the plea of the statute. Rense v. Southard, 39 Me. 404. But where the delay of the plaintiff to seek relief was occasioned, in part at least, by the promise of the defendant to rectify the errors complained of, the existence of such errors came to the knowledge of the plaintiff gradually, and the circumstances of the case were such that the defendant could suffer nothing by the delay, it was held that the plaintiff was not precluded from relief on the ground that he had not sought it within reasonable time. Callender v. Colegrove, 17 Conn. 1. And where it is agreed between the assignor and assignee of a promissory note, at the time of the assignment, that the assignee need not demand payment of the maker before a certain time, it is no laches in the assignee not to commence suit on the note before that time. Nance v. Dunlavy, 7 Blackf. (Ind.) 172. When the limitation is by agreement, as in an insurance policy, it is generally held that any conduct on the part of the insurers which leads the insured to delay, is a waiver of the limitation. Black v. Winnisheik Ins. Co., 31 Wis. 74; Fullam v. N. Y. Union Ins. Co., 7 Gray (Mass.), 61; McKown v. Whitman, 31 Me. 448; Buckner v. Calcote, 28 Miss. 432.

1 Miller v. Powers, 119 Ind. 79; Jackson v. Buchanan, 59 id. 390; Wynne v. Comellson, 52 id. 313.

2 Stow v. Brown, 116 Ind. 78.

8 See Rhoton v. Mendenhall, 17 Or. 199. 4 Tillson v. Ewing (Ala.), 8 So. 404. In this case the court held that where due and proper inquiry for a certificate of entry filed in the proper governmental depart

ment for the purpose of obtaining a patent would have led to information of its issuance, which is the only fact claimed to have been discovered, the concealment or destruction of the patent will not constitute fraud which, under the statute, will operate to prevent the accrual of a cause of action, until its discovery. In Wisconsin it is held that actual notice of the facts is necessary, and constructive notice will not put the statute in motion, under a statute providing that a cause of action for relief on the ground of fraud does not accrue until the discovery of the facts constituting the fraud. Fox v. Zimmermann, 77 Wis. 414. In New York it was held that an action to rescind a purchase of stock in a corporation, induced by fraud, does not accrue until the discovery of the fraud by plaintiff or the person under whom he claims. Bosley v. National Mach. Co., 123 N. Y. 550.

The statute does not run as to a claim against a firm of solicitors for money sent them to invest but which is embezzled by their clerk, until discovery of that fact, where they represent that it has been invested and continue to pay interest on it. This rule is unaffected by the English Trustee Act, 1888. Moore v. Knight, 1 Ch. 547. In Louisiana it is held that prescription against an action to annul a judgment for fraud only runs from the date of discovery of the fraud. Lazarus v. McGuirk, 42 La. An. 194.

The statute does not begin to run against the claim of a shipper to recover back excessive payments of freight charges so long as he has no knowledge of his rights, owing to the fraudulent concealment of the cause of action by the carrier.

"concealment" which prevents the running of the statute must be of a positive and affirmative character was applied in Indiana, where one sued for criminal conversation had persuaded the plaintiff's wife to deny the same for two years; and the court held that such denial or procurement thereof was no "concealment." Living with a woman without marriage to her, and publicly acknowledging her as the wife of defendant, does not constitute a case of concealment of the crime of fornication, such as will take the offence out of the statute of limitations.2 In Iowa, the provision of the code as to fraud is held to apply only in cases of equitable cognization; and in a case where B. conveyed to his son, who died shortly afterwards, leaving an illegitimate son whom he had recognized, and after the death of his son, B. again conveyed the property to another, in fraud of the rights of the grandson, who had no knowledge of the existence of the estate of his father until twenty years afterwards, whereupon he immediately commenced his action, it was held that it was barred by the statute. In Maryland, it is held that where one practises fraud, to the injury of another, the subsequent concealment of it from the injured party is in itself a fraud; and if he is thereby kept in ignorance of his cause of action, he is kept in ignorance by "the fraud of the adverse party," within the meaning of the statute regarding the right of action" to have first accrued at the time at which such fraud shall, or with usual and ordinary diligence might, have been

Cook v. Chicago, R. I. & P. R. Co., 81 formed by his debtor that he conducted his Iowa.

The statute does not apply to an action brought to procure the cancellation of a sheriff's deed of land sold under a judgment which had been purchased and held by one who, acting under a trust, had collected funds for its satisfaction, to such purchaser, and to remove the incumbrance of the judgment from the property. Wilson v. Brookshire, 126 Ind. 497. In Kentucky it is held that the statute runs against an action by a creditor to subject his debtor's lands to the payment of his debt, although the creditor lived in a distant county and did not know of a conveyance by his debtor of the land and a record of the deed in the county where the debtor lived. Cockrill v. Cockrill (Ky.), 13 Ky. L. Rep. 10.

The statute only begins to run against an action to charge a trustee for the trust property which has been fraudulently purchased at a judicial sale for his benefit, from the discovery, by the cestui que trust, of the facts constituting fraud. Lewis v. Welch (Minn.), 48 N. W. 608.

When a creditor admits that he was in

business in his wife's name to prevent his creditors from hampering him, it is an acknowledgment that he then had notice of the fraud, so as to set the statute running from that date against an action by him against the wife. Osborne v. Wilkes, 108 N. C. 651.

In Ohio the statute begins to run against an action to reform a written instrument on the ground of mistake, upon the execution of the instrument, and not upon the dis covery of the mistake. Bryant v. Swetland, 48 Ohio St. 194.

But in Nebraska it is held that the statute begins to run against a suit to correct a mistake in the drafting or recording of a deed, where the correction involves no change of actual possession or disturbance of investments, upon the discovery of the mistake, or of such fact or facts as would put a person of ordinary intelligence and prudence on inquiry. Ainsfield v. More, 1 Neb. L. J. 202.

1 Jackson v. Buchanan, 59 Ind. 390.
2 Robinson v. State, 57 Ind. 113.
3 Brown v. Brown, 44 Iowa, 349.

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