*1 37,894 No.
Loring Dalton, Appellee, v. The Lawrence National Bank, a Irving Hill Hill, Appellants. Corporation, and Justin D. 37,895
No. Murphy, Appellee, Dalton The Lawrence v. National Corporation, Hill, Appel- and Hill Bank, lants. 37,896 No. Margery Dalton Hurst, Appellee, v. Lawrence National Corporation, Hill, Appel Bank, Justin D. lants. (219 719) P. 2d
Opinion filed June 1950. Petefish, argued cause, Stewart, Lawrence, of Law- and O. K. of C. C. Hill; appellants, D.
rence, Hill and-Justin on briefs for the Asher, Lawrence, argued cause, Alan F. Henry M. Gorrill and and C. H. of appellant, Lawrence, The Asher, him on for the -were with the briefs both of . Bank, corporation. a Lawrence National Oyler, Rice, Lawrence, argued of Raymond Robert B. causp, F. of appellees. Lawrence, for with him on the briefs was delivered opinion The of the court money. They were actions to recover J.: These were Smith, here. All three together in the court below and consolidated heard plaintiff’s petition in each case demurred to defendants a cause ground that it did not state facts sufficient constitute face the cause was barred the statute of action and showed on its misjoinder and in case of the bank on account of limitation All three These demurrers were overruled. of action. causes appealed. defendants have identical, action are so those one pleadings for
The each grew living out of trust only be stated. The actions case will during lifetime and to end five G. Bowersock her created years death. after her Irving Hill Bowersock, and Paul A. Dinsmoor were died, Hill and Dinsmoor so Bowersock trust. of this
trustees
403 Amongst continued to act. of this were 900 assets trust shares Company. Amongst stock in Paper the Lawrence the various Margery Dalton, daughter Mary. beneficiaries were She B. By beneficial owner of of these shares. her will she testamentary created a trust named defendant she testamentary In disposed trustee. this trust she above 144 shares. Her husband elected not to under the will, take so only seventy-two shares left in the trust. left four chil- She provided in dren, and her will that each these children should be equal beneficial owner of an share of this Hence each stock. child became the beneficial owner shares. These cases in- volve claim three these children were each fraudu- lently caused the defendants to sell these shares less than they were worth. One of the children Margery bring action. begun was filed and the action on June 10, 1948. It parties the residence of incorporation of the bank; *3 Irving Hill and president
that was at all times had been the of Irving and Justin D. Hill was a of years bank son and for five had bank; a director of the that was the son of Margery B. Dalton, daughter Mary who was the of Bowersock, G. both de- in Margery that the will of ceased; B. the bank Dalton was named testamentary guardian and trustee for the four children of Mar- gery accepted appointment and the and acted as such during minority the of plaintiff, and at the time the action was filed was so acting. Mary then by that G. Bowersock her deed January
of trust on created a trust for the and benefit use children, including of Margery Dalton, her six B. for the lifetime years Mrs. Bowersock and for thereafter; of five that it further was provided expiration years that of at the five from the of death principal Mary, the exception trust estate with now an. important conveyed children; was to be to the that Justin Bower- D. Irving Hill sock, designated and Paul A. Dinsmoor were trustees and to the death Dinsmoor of the other two continued years to that five had act; elapsed when the Mary after death of G. Bowersock, September agreement a trust extension the including executed all of beneficiaries, the defendant guardian as and trustee for and for bank the other children deceased; Margery Dalton, agreement B. that trust the extension provided the the for the immediate distribution of certain of assets remaining trust as and for the continuance of it to the assets; immediately in the included securities to be distributed were capital Paper shares of the Lawrence Company; stock seventy-two shares, these 900 were distributable to the defendant Margery’s bank trustee under will for the benefit of the four distribution of 900 shares was made children; no Hill, Irving trustees, Mary Justin Bowersock and G. D. Irving objected defendant, Hill, to the trust; that the Bowersock representing this stock to the beneficiaries issuance certificates objection the stock continued to in the and reason of this stand years for Mary name of trust more than two subse- G. Bowersock defendant, Irving Hill, de- quent September 3, 1942; that dis- Paper Company sirous that stock of the Lawrence testamentary sold the bank as trustee be bank and tributed to an procured attorney representing from the to that end might bank; such be sold the 900 opinion that percent 4,000 referred to constituted shares issued shares 22% corporation; 1,350 by Irving Hill, shares were owned wife, D. Hill, Hill, his referred as the Hortense B. by Mary Dinsmoor, B. 1,350 Hill shares were owned interests, and Patton, and E. Dorothy Patton, daughter, her W. husband Patton, interests; referred Dinsmoor Dorothy D. equal interests were the Hill Dinsmoor holdings of purpose obtaining Hill control Hill and Justin D. purchase additional stock an amount suffi- company desired to ownership 2,000 of more than interests cient to vest Hill, this Justin D. with the accomplish shares and to already the 900 of stock acquire out to shares set exception Mary trust, G. with the in the Bowersock referred beneficially interested and B. Dinsmoor in which shares *4 beneficially Hortense B. Hill stock in which was amount of the like interested. D. alleged Hill, with the consent that Justin further
The purchase Bowersock for the with Justin Hill, negotiated D. nego- he stock, entitled, which was and after shares per for years bought share, $107.50 it extending over several tiations represent value; May 19, its actual that thereafter on which Hill, D. caused to be on the defendant, Justin written station- to the a letter wherein the ery bank defend- defendant Paper Company the Lawrence falsely that stock ants stated was there was trust; in Dalton which could be held not stock payer a because for it and it had not been dividend no market value of develop business; that the earnings had been used and as the shares had been determined examination and audit of the stock which D. Bowersock had result shares Justin beneficially interested had been been D. Hill sold Justin at price per $107.50 share. defendants in the communication further
The of the price $107.50 D. Hill at the proposed the sale to Justin beneficially in- in which the eighteen shares of stock terested. Company’s Paper Lawrence that the further established with no closely-held, actually
stock was unlisted as trustee bank the defendant duty of that it was the market; of it to advertise any proposed sale with in connection would reflect price that only it at a sell it and to invite bids duties disregarding its defendant value; its actual that the D. defendants, Justin acting solely in the interest trustee and made nor stock for sale advertised the Irving Hill, Hill and neither Hill, had recom- defendant, Irving any attempt bids; that to obtain Justin defendant, 72 shares to mended to the bank the sale of the and at the in- recommendation Hill, pursuance D. and in of this plain- Hill, the bank directed to this defendant, stance of sold the communication referred to and thereafter tiff the price per privately share, $107.50 D. Hill at the to Justin value; defendant, Irving Hill, actual represent did not May 19, 1944, incorporation and had been since the of the com- on pany president, defendant, and the Justin D. its on that date and had been since 1933 a director and since 1942 a vice-president company; Hill and Justin D. Hill management company were both active knew May 19, 1944, that the book value and the actual value of this greatly per in excess of share; $107.50 stock was condition; financial was in excellent that its current assets amounted compared to the current $745,000 liabilities of $65,000; assets; that it had a book value in it had fixed per $225 excess of going many years it concern and for share; that was had been earning large profits and no dividends had paid because of the paid employees to the large salaries and bonuses and officers of the including Irving Hill and company, Justin D. Hill “that notwith- standing of such facts and their fiduciary duty as *5 managing and officers to make disclosure of same directors seeking of the stock de- any acquire, stockholder said Irving Hill, and not, Justin D. in the com- fendant, either May plaintiff of munication to this hereinabove referred otherwise, orally plaintiff or disclose to to, any this of the facts here- any bearing set out or other facts upon inabove affecting or the value Paper the stock of the said Lawrence Company.” plaintiff had no knowledge The further or Paper Company information as to business Lawrence and profits earnings and of said the amounts of the paid officers; and bonuses its that the upon salaries relied by the statements made the defendant and believed that D. Hill had made a and Justin full and fair disclosure him of possessed by all information affecting them the value of the stock fully and discharged believed the bank had fiduciary its duties as trustee; during the months May and June, 1944, the actual Paper market value of the Company’s Lawrence stock was per $400 joint share and as a result of their and concurrent acts as set out and pursuance conspiracy participated by all of the defend- eighteen ants the shares of paper company’s stock were sold D„ defendant, the bank to Justin Hill, price at a $107.50 per share; purchase for the funds of the stock were furnished and ad- part vanced in or in whole defendant, Irving Hill. The then contained following allegations: action, ground plain- “That this is an for relief on fraud and that this upon tiff did not discover constituting the facts herein relied such which, investigated, nor knowledge fraud other facts if would have led to day June, fraud of such to the 12th plain- until 1946. That unable, ordinary diligence, tiff was to discover said fraud reason of the constituting peculiarly fact the facts such fraud were within the and plaintiff.” defendants were concealed them from this then reason of the facts plain- set out damages tiff had sustained actual in the amount of $5,265 and the acts described defendants involved a violation of fiduciary duties constituted willful invasion of rights punitive was entitled to damages in the amount of Judgment prayed $5,000. in the amount of $10,265. petition defendants filed To this several a series of motions to compel plaintiff and to make strike definite and certain. part motions were sustained part. These overruled in They point. at this will be noticed to amend be ordered asked that defendants
All three will, Mary Dalton’s Margery by setting copy out a B. *6 his agreement and a trust trust, of extension deed G. Bowersock’s overruled bank. This motion was by the copy of the letter written A was copy of it ordered attached except copy to a letter. petition. They also asked that the amended- and attached to was parts of and that two different another paragraphs five be stricken para- was as to certain be This motion sustained paragraph stricken. allegation graphs important not now and the “that and as a re- joint acts, sult of their and as herein out, concurrent above set and pursuance in of plan participated a and conspiracy, in all of the defendants herein” was ordered stricken.
All three defendants filed a further they motion which asked required plaintiff that the be to elect as to whether he attempting to ground recover on the that defendants had their duty breached ground fiduciaries or claiming on the of fraud these two theories were treated separate paragraphs.. This motion sustained.
Subsequently on January 14, and 1949, an amended petition was filed. This pretty followed generally the allegations of the nn original petition except alleged, that it as follows: defendants, Irving Hill, acting “The Hill and conspiring and to- gether, acquire and-purchase,’ out set to in the name of the said Justin D. Hill, sufficient of Paper the 900 shares of said Company Lawrence stock held in the G. Bowersock Trust to vest in the Hill family, interests and consisting defendants, Irving Hill and Justin D. Hill and Hortense B. Hill, Hill, the wife ownership of more than of the stock 50% Paper Company of said thereby and company.” secure control said ' And further— defendant, Hill, procured “The Justin D. and to be written Caused and the defendant, Bank, cooperating conspiring Lawrence National and with the defendants, and Justin D. plain- directed and mailed to this May 19, stationery tiff, on the' signature said Bank and over the . . .” of its Trust Officer. copy Also, the bank under date of May 19, 1944, was attached. bank filed a
To this amended defendant motion to strike main, the separate allegations. nine In the basis of this motion allegations should stricken because was that be were con- tradictory in the letter some to the statements of them were immaterial. except motion irrelevant This was overruled as to had stated allegation an defendants of the Lawrence Paper Company was not stock which should be held the Dalton allegation trust. was ordered stricken. That asking plaintiff The bank also filed motion required to make his more definite and certain setting out facts constituting on as fraud relied such other facts al- leged defendant, have been concealed from him the the Law- Bank, rence National plaintiff which were discovered sub- sequent day the 12th of June, 1946, of which the did not knowledge, full theretofore have facts the unable by ordinary diligence prior to have discovered day 12th June, day and such facts so discovered 12th June, peculiarly within of the defend- Bank, ant, National and were concealed Lawrence said de- and, Bank, National from the fendant, the Lawrence and time at which the discovered of such date *7 facts.
This motion overruled. asking Irving Hill,
At same time defendant filed a motion the required to elect whether he relied the fact that the on duty or on he and Justin Hill breached their as fiduciaries expected prove he to that he was the beneficial fraud, and whether expected prove he to the 18 shares of stock or owner of whether require plaintiff to elect whether he the stock and to that he owned for Irving Hill and Justin Hill conspiracy the between relied on Paper Company percent of the Lawrence more than 50 obtaining the for the Hill inter- company, was to obtain whether the or require him to adequate price, to elect paying an ests without sold the stock expected prove that defendant bank he whether proposed suggested and the sale secretly that the defendants copy of the G. required set out a plaintiff be letter; that agreement Septem- extension trust, the trust deed Bowersock’s strike from the Margery Dalton and to 1942, and the will ber purchase “That the funds for the of said allegation petition the de- advanced, part, in in the whole or furnished and stock were allegation petition from the Irving Hill” and to strike the fendant, not stock Paper Company stock of said Lawrence “That the allegations: the Dalton Trust” and also should be held said and said shares had been determined examination value of “That the per share, $107.50 such ex- and a result of not exceed that as and did audit D. Bower- of such stock in which Justin audit shares and amination beneficially him to Justin at sock was interested had offered D. Hill price $107.50 per said share.” And require petition make his more definite and certain by stating upon he what acts of fraud called discovered after exactly June when them he discovered and to state which, investigated, what facts if to knowledge would have led such exactly fraud he discovered to June when he discovered such facts.
Defendant, Hill, substantially Justin filed the same motions. They except were all allegation, overruled which was ordered stricken, already noted.
The bank ground misjoinder demurred of causes of action; that petition did not state sufficient to constitute facts a cause of action petition and that the showed on its face that cause action attempted pleaded to be barred the statute of limitations.
Irving and Justin Hill demurred on grounds not state did sufficient facts it constitute cause of action and on its showed face that the cause of attempted action to be stated was barred statute limitations. appealed.
All three defendants have It We shall bank. argument examine first first, original causes that several face showed on its action improperly joined and that the remedy allegation basis is the this. The of this original duty bank place one that it was as trustee to in- bids, to invite but advertise stock for sale and stead, the in. charged; sold stock to another place, Hill, as officers of the Hill and Justin *8 paper company, duty a owed to make full disclosure to a whose stock they trying require buy. plain- were to to A motion to tiff elect between these two theories sustained.
As the ruling correctness is not here review we cannot say ruling whether the requiring the election was correct or not. allegation with reference duty to the the bank to as trustee call for selling bids before the stock from was omitted the amended petition. required
It is may well eléction of remedies be settled that an only inconsistency allegations when there in one is such necessarily repugnant cause of be repudiate action to the must or 410 (See Taylor Co.,
other. v. Robertson Petroleum Kan. 150.) 2d The test is but P. whether one satisfaction is asked. This application is a for the of'that case doctrine. The asked only one satisfaction. the bank, trustee, Proof that failed to proper steps safeguard que take to the welfare of its cestui trust way repugnant to, would in no disprove allegation Irving Hill, president who was of the bank president and also paper failed company, to make the proper-disclosure of the condition plaintiff. There is an allegation that all these only actions defendants had one end,"that tois, enable defendant acquire than Justin the stock at less its actual value. In ’against parties only order to state a'cause of action several it is necessary may to state facts from the reasonable inference' be drawn there was a concert of action between them, which re wrongful (See Nardyz sulted in the act. Co., v. Fulton Fire Ins. cited.) opinions Kan. 101 P. 2d there reason A inference, able may be allegations drawn from the of this amended through that the bank its trust officer letter, wrote the Hill, who caused the written, Irving letter to be presi who was dent of the bank president paper company, all acted to doing some gether, one thing, some another, all working but to cause plaintiff to sell his stock for less than its actual Irving Hill, value. president company, and Justin Hill, vice-president, owed duty to make complete disclosure of the condition of (See company. Hotchkiss v. Fischer, 136 P. 2d misjoinder
We hold there was no of causes of action. on its face that petition shows argues the bank next Defendant The basis of'this against it. action state cause of it does not May 19,1944, on the letter of is founded is that the action alleges false statements on the certain and that while any of allege that the statements part bank, not it does is bound the statements in this letter were false—-hence alleged in the letter are not letter, and since the statements against a cause of action the bank fails to state be false the say none statements for fraud. It is not correct be false. The letter stated “The stock has the letter are earnings being develop not been a used to business.” payer, dividend falsely stated the had The amended earnings being payer been a dividend because the used to
411 had audit a statement stated letter develop The the business-' alleged The amended 31,1943. December inade as df been had of the shares that the value falsely stated that thé letter in- The letter stated and audit. examination determined' justified price appraisals $107.50 liquidity over creased earlier falsely stated share. The amended ex- that after $107.50. the value did not exceéd The letter stated audit, amination of had the statement and certain stockholders petition alleged offered their stock to Justin Hill. The amended that this statement was-untrue.
The many' pertinent truth of statements of the letter denied. It is not necessary all be It is sufficient if false. all of the false ones or one of part them be a what caused plaintiff part (See with his Baker, stock. Vernson 124 Kan. v. 575, 261 563; 76½.) Pac. 26 1165, C. J. sec.
Moreover the con parties all spired together to obtain the stock for Justin Hill without payment of an adequate price; that Justin Hill caused the letter to be written and the it, wrote being and the without information relied on paper company as officers and the bank as fully trustee to completely. inform them Under the statement pleaded of facts only bank is own liable not for its acts but for the acts done other member the conspiracy. (See Mosley Unruh, v. 150 Kan. P. 2d 469, 537; also, Holderman Hood, v. 78 Pac.
In connection with phase this points of its brief the bank out the statement in the letter Report “Auditor’s is of Dec. you available should go wish into the matter.” The bank statement was offered particulars all the he claimed were thereby concealed and plaintiff’s collapsed. case
We cannot argument. follow this In the place, first it does not necessarily report follow auditor’s tendered the letter would have disclosed true condition of or the falsity of the upon statements which the action based. are is We in the dark as to report what this would have shown and a de- murrer to a give we cannot it the force contended In bank. the second place, and the bank dealing were not length. at arm’s The letter was from a trustee bene- to one ficiaries the trust. place complete was entitled to faith and confidence in duty what bank said. It was the bank’s *10 it is liable for either disclosure and complete a full to make (See 282, 35, 23 C. J. S. sec. concealment. 37 misrepresentation or Kan. 159; also, Knowlton, Hutto v. 966, sec. Am. Jur. bank insists supra.) Defendant Fischer, 825; Hotchkiss v. also, Pac. be account must unambiguous and clear and the letter was As a matter according express the words used. interpreted an effort to cause the to be a model of fact, the letter seems to us actually saying so. facts without a certain state of reader believe full duty bank to make the fulfilling It falls far short of the of the complete required under the circumstances. disclosure original petition and the argues Defendant bank the next petition the action was amended both show on their face that by they point barred statute of In this the limitations. connection applicable 1935, 60-306, subpara- out first that the is G. S. statute graph years ground two ... for relief on the Third —“Within fraud”; May 19, 1944, that this cause action accrued on when the letter original petition the was filed June written; years twenty-one days four alleged perpetration after the of the fraud and petition January filed or four years, twenty-five seven months and days after the perpe- tration of fraud. The bank allegations calls attention to the petitions both that the fraud was not discovered until 12,1946, June points and then out its motion wherein it asked required be petition to make its more definite and certain stating upon what facts constituting relied fraud or concealed facts from him the bank were subsequent discovered him to that date. points The bank then out that this motion was overruled and hence allegations of the as to the discovery of the fraud must strictly construed. The balance of the bank’s brief on this point is reiteration its previous on the point, is, says allege bank since the any not of the statements the letter were false cannot be say heard to he subse- quently discovered were false. already have demonstrated that the
We letter and the allegations with reference are subject to the letter to for by allegation construction contended the bank. The peti- tion with reference the failure to discover the is, fraud as follows: ground plain- “That this is an action for relief on the of fraud and that this upon constituting tiff did not discover of the facts herein relied such which, investigated, knowledge fraud nor other if facts would have led to day June, plain- of such fraud until 12th 1946. That diligence, fraud reason of the unable, by ordinary said to discover tiff was peculiarly constituting within the such fraud were facts fact that the plaintiff.” from this concealed them and were the defendants para- in the' above allegation in effect that state- is contradicted graph petition about concealment argues that this audit. The bank tendering ment in the letter show and audit would of what the put on notice are in the place, we In the first run then. the statute commenced to state on con- cannot would show. We dark as to what the audit plain- would enable the that it of a demurrer to sideration (See v. company. condition tiff to ascertain true Duffitt There we said: Tuhan, years, brought requires but within two an action to be “The statute such provides in such case shall not be deemed cause of action further *11 this, discovery In a case like the statute of the fraud. have accrued until the begin discovered.” does not to run until the fraud is plaintiff more of a owed place, In the bank as trustee the second place, In the third the duty than mere of an audit. the tender might jury double talk that a ambiguous replete with so means actually that it was draw a inference therefrom reasonable purpose. real their used defendants to conceal Defendant bank argues petition next to the its demurrer should have been sustained because amended show petition does not on its face as a pleading matter of barred that it was not statute of limitations. argues conspiracy
The bank that for the first in 1949, time petition January 14, amended filed and that plaintiff alleged petition he did his that not discover the subsequent fraud 12,1946, years, until or two seven months June and twenty-five days after the of It discovery the fraud. then began that statute to run not from the date of the con- spiracy damaging discovery. but from the date of the acts or their argument depends validity
This for its on the statement there charge conspiracy original petition. was no We have There allega- demonstrated that this statement is not correct. were charge conspiracy tions in the from which a original part concerted action on the of all the defendants could be reason- ably parties inferred. Moreover it is conceded all began statute to run from the time when the fact a fraud has been from perpetrated discovery par- was discovered and not petition alleges The amended ways ticular and means used. there 414 constituting relied on as discovery any of the facts
was no investigated, if would have led to which, fact fraud nor until June the fraud because the facts con- to discover the fraud were unable plaintiffs knowledge and concealed stituting peculiarly were within it was discovered under which the fraud The circumstances them. (See Ryan, al., the statute. et A. to avoid v. need not be stated L. 365.) 21 Kan. There we said: al., Rly. Co., et N.& W. which the fraud was discovered do not constitute under “The circumstances discoveiy action, stated, part and need not be even where a of the cause of apparent of limitations.” avoid the bar of the statute
must be Condensing 356, 86 120 Pac. (See, also, Dawkins, Co. v. Kan. 159 Campbell, v. Kan. Pac. Pickens large in a measure The bank relies on what we said in Schulte v. Westborough, Inc., 2d In we P. 278. that case ground held that in order to state a cause of action on the of fraud running two-year limitations, which will toll the statute of necessary is clearly it disclose the fraud diligence the exercise reasonable could not have been dis two-year covered earlier than within the period preceding the com mencement of the opinion action. This point is not in here reason that the amended alleges here “this plaintiff un able, ordinary diligence, to discover said fraud by reason of the constituting fact the facts such fraud peculiarly within the knowledge of the defendants and were concealed them from this plaintiff.” element concealment the fraud was not in the *12 opinion. in the
discussed Schulte against hold that the action the bank was not barred We plaintiff’s peti- limitations. The bank’s demurrer to the statute of correctly tion was overruled. Irving of and Justin appeal of now to a consideration
We gq petition discloses on its face Irving argues Hill first that Hill. He that thie of limitations. it barred the statute was buy Hill set out to alleged Justin original merely charge of conspiracy and that stock with Hill’s January filing amended on not until the was years 12, than after June when 14, 1949, which was more two is the fraud discovered. was it good have argument already not the reason we stated This is original peti- in the ample allegation was that there opinion in this on the action inference concerted from which a reasonable tion not petition did be defendants could shown. The of all part against Irving Hill. new cause of action state have been sus- should their demurrer argue The next Hills concise statement a clear contain because it not tained phase first and contradiction. repetition the facts without to who is claimed as argument clear pleadings are not is that the held whether it was is, sale, the time of to have held the stock at as Bank, National Trust, The Lawrence M. G. Bowersock just how the situa- trustee, hardly plaintiff. We understand clearly. Facts were stated tion could have more been stated agreement for the ex- clearly appears from which it that under an Mary September 3, 1942, tension of cer- Trust, G. Bowersock dated securities, including paper stock, tain the 18 shares beneficially interested, immediately dis- became ; tributable that the trustees that trust did not distribute it to the beneficiaries sales, entitled to the stock and after certificates about which complains the stock was transferred to Justin by the Mary Hill G. Bowersock The bank, appears Trustees. from its letter of May treated stock as if certificates had issued in name its as trustee and were in possession. its recognized rights It by the same letter. It stated part acts of all three defendants, which if proven, would en- title the damages.
The Hills argue next erred in requiring that the trial court not plaintiff to attach to the copies Margery of the will of B. Dalton, the trust G. deed Bowersock and of the trust ex- agreement. tension None of these are upon instruments relied evidence of indebtedness, so require they the statute does not (See Superior attached. Oil Blunk, 161 Co. v. P. 2d impressed
areWe with the of defendants that copies needed prepare defense, these instruments in order their in view of the fact one trustees of the Mary G. Trust, Bowersock the bank he president of which was Margery trustee under the capacities Dalton Trust both he argeement. knew all about the extension trust Irving and Defendants, argue next that their demurrer should have been sustained because neither one of them owned *13 concerning duty plaintiff disclose the facts value to to
fiduciary Loring Dalton was paper for the reason not stock purchased company and the stock was not from stockholder of actually from plaintiff purchased the bank. The answer but was beneficially to in the that is that was interested stock and Irving president trustee bank also of paper and in the Hill, bank, a director caused the parties thought plaintiff be written. All had sufficient interest in the stock that necessary deemed it write letter.
Irving argue and Justin Hill next their demurrer to should have been sustained because the statute of limitations began to run from May, 1944, the date knew the fact that the Hills had failed disclose him the true value of the stock. G. S. 1935, 60-306, third subparagraph, provides actions for relief ground on the of fraud the cause action not shall be deemed to have accrued until discovery of the fraud. The real fraud here purchase of plaintiff's inadequate stock at an price. The statute running started from the time discovered that de- by writing ambiguous fendants an letter of half truths some false statements him caused to sell his at less than its actual value. (See Gates v. Kansas Farmers’ Union Royalty Co., 153 111 P. 2d alleges that to June 12, 1946.
Defendant, Hill, next his demurrer to the petition should have been sustained because no cause of action is stated against him. argument In this again defendant maintains that the does allege that any of the statements letter were untrue. We have heretofore demonstrated that this argument good. is not Nothing would be added effectiveness opinion repeating what has been said. argue next their demur-
Defendants, and Justin rers to the petition been sustained because the record should have allegation nondiscovery an of the fraud must discloses about untrue. all such In out facts as they point this connection assets, profits the book assets, value of stock, current fixed report dividends would all be in the annual filed with the included reason, secretary good state. This is not report annual to the impart does not constructive notice as to the of the corporation. condition
They May 19, letter of point next out an the offer of audit in *14 diligence required They argue 1944. that due to take record on one hand public notice of the audit on the other. argument good as far the Hills are This is not concerned for the good same reason when advanced in bank, it was not behalf already demonstrated. has may The same be said of their did good not state a cause of action because it state the circum- discovery stances of the of the fraud. judgment of the trial court is affirmed. J., not participating.
Thiele, (concurring): My I J. concur in the result. views on Wedell, what a allege must under our weight own decisions and the of authority generally, in order to toll the statute of limitations pertaining fraud, 1935, 60-306, S. sepa- G. are stated in a Third, opinion in day rate Dalton 37,893, decided, v. No. 219 P. 2d I 710. What have said there need not be re- peated here. 37,900
No. Maltby Raymond R. L. Arthur and Harold Maltby, Maltby, Appellants, v. T. Kathleen Sumner and Milton Sumner, Appellees. (219 395) P. 2d