Grant v. HartGrant v. Hart
2. While a mere prayer for an accounting in an action seeking damages for a tort, and based upon no trust or fiduciary relation, will not make a petition one in equity (Burruss v. Montgomery, 148 Ga. 548, 97 S.E. 538, and cit.; Gormley v. Slicer, 178 Ga. 85, 172 S.E. 21, and cit.; Universal Garage Co. v. Fowler, 184 Ga. 604, 192 S.E. 299; Clarke v. Upchurch, 31 Ga. App. 601, 121 S.E. 525;
(a) “Trusts are implied . . where, from any fraud, one person obtains the title to property which rightly belongs to another.”
(b) The petition alleged that the defendant, by fraudulent representations of himself and his agent, obtained the plaintiffs’ valuable stocks and United States bonds worth $11,898, by exchanging therefore certain worthless stock and certain bonds worth $6,270; and that two other persons, conspiring with the defendant, by fraudulent representations later obtained from the plaintiffs the bonds which the plaintiffs had received from the defendant, through a swap of entirely worthless stock for such bonds, and sold the bonds which the alleged conspirators thus obtained to the defendant or other purchasers procured by him. Under the foregoing rules, the averments of the petition sufficiently alleged an equitable cause of action for establishment and enforcement of a constructive trust, and for an accounting as to the trust property and its proceeds and “the income therefrom if said stocks and bonds could be traced,” with an alternative prayer for recovery of the proceeds of sale, equal at least to their market value at the time of sale, if the property could not be traced.
3. As to a tender, it was alleged that before suit the plaintiffs had formally tendered to defendant all money and the worthless stock received in exchange for their own stocks and bonds: that defendant refused the tender and denied any liability: and that plaintiffs “continually tender to the defendant said stock certificates . . and said [money], and state they are agreeable that any decree or judgment . . against the defendant be conditional upon said payment and transfer by petitioners or offset in an amount equal to said [money] and the transfer of said stock certificates or any other sums or property which the court
4. A general demurrer does not raise questions as to multifariousness, duplicity, or misjoinder of causes of action, or as to nonjoinder or misjoinder of parties. As to such matters, a special demurrer is necessary. Tingle v. Maddox, 186 Ga. 757 (198 S.E. 722); Shingler v. Shingler, 184 Ga. 671, 672 (192 S.E. 824); Wilkinson v. Smith, 179 Ga. 50, (176 S.E. 373); Burkhalter v. Peoples Bank, 175 Ga. 744 (3) (165 S.E. 749). Since the only special demurrer raising any of these questions attacks merely the alleged misjoinder of causes of action as to paragraph 78 of the petition, referred to in the preceding division, only the question of misjoinder thus raised can be considеred. Where several matters are stated in a petition, not as distinct and unconnected. but as arising “out of the same transaction or series of transactions, forming one course of dealing, all tending to a single end,” a demurrer for misjoinder of causes of action will not lie. Griggs v. Griggs, 218 N.C. 574 (11 S.E.2d 878). Under this rule, paragraph 78 was not subject to the special demurrer on this ground, since under all of the averments the last transaction set forth in that paragraph was such a part of the alleged original scheme, fraud, and constructive trust and
5. Where several persons conspire to defraud another, one or all of the wrong-doers may be sued, “proof of the conspiracy renders the act of one in deceiving and defrauding the injured party the act of all,” and an implied or constructive trust may be set up as to the subject-matter of the fraud and conspiracy. Wall v. Wall, 176 Ga. 757 (1, 4, 5), 760-763 (168 S.E. 893), and cit. Since the petition sufficiently charged a conspiracy between the defendant and the two persons referred to in paragraph 3 above, to defraud the plaintiffs with respect to the last stock and bond transaction in question, therе is no merit in the grounds of special demurrer to the petition as failing to allege that the defendant authorized the particular misrepresentations and the agreement of the alleged co-conspirators with the plaintiffs, or that such person had authority so to act for him. As to the last transaction, the petition was not subject to special demurrer as failing to allege whether the agreement of the alleged co-conspirators was in writing, since such agreement was not the basis of the alleged cause of action, and since the failure to allege that the agreement was in writing would not, in any event, render the petition demurrable, the silence of a pleader raising no presumption that a contract exists only in parol. Anderson v. Hilton Dodge Lumber Co., 121 Ga. 688, 690 (49 S.E. 725), and cit.; Ansley v. Hightower, 120 Ga. 719 (3) (48 S.E. 197); Mobley v. Lott, 127 Ga. 572 (2) (56 S.E. 637); Boney v. Cheshire, 147 Ga. 30 (2) (92 S.E. 636).
6. With respect to the first transaction, described in paragraph 3 supra, relating to the exchange of stocks between the alleged agent of the defendant and the plaintiffs, the averments were sufficient to charge agency and authority of the person so dealing with the plaintiffs, to act for the defendant.
7. The paragraphs attacked as failing to allege facts sufficient to show fraud, a constructive trust, or agency, and as irrelevant, immaterial, or stating mere conclusions, were not subject to these sрecial grounds of demurrer, since the averments were pertinent to such questions, and, taken with other parts of the petition, sufficiently alleged the essential facts.
8. The statutory period of limitation in a suit for an accounting against an alleged trustee ex maleficio, and for establishment of an implied or constructive trust as to personal property, is ten years. This suit in equity for that relief having been brought within less than seven years from the accrual of a cause of action, and the averments showing no laches against the plaintiffs, such as would reduce the statutory period to a lesser period, for the reasons stated in the оpinion the grounds of demurrer that the action was barred by the statute and by laches were properly overruled.
9. The court properly overruled the demurrer to the petition.
No. 13643. MAY 15, 1941.
On March 12, 1940, Mrs. Mattie Elizabeth Hart, who had held in her name certain stocks and bonds, and others who claimed an interest therein under the will of her husband and other facts, filed this petition against Ed S. Grant. They seek to establish and enforce an alleged constructive trust as to such property, and pray for an accounting by the defendant for the proceeds and income if the stocks and bonds can be traced, and, if not, an accounting for an amount “at least еqual to their market value at the time the defendant obtained them, plus interest at 7 per cent., . . so that petitioners have judgment . . in the sum of $6460, with interest thereon at the rate of 7 per cent. per annum until paid, from March 18, 1933, said interest amounting to $3517.86 at the time of filing this petition; and the additional sum of $11,898.70, with interest thereon at the rate of 7 per cent. per annum until paid, from March 20, 1933, . . amounting to $5811.86, . . the total amount of principal and interest . . at the time of filing this petition being $27,238.42.” The essential averments are as follows: On March 18, 1933, Mrs. Hart “endorsed in blank and delivered to the defendant . . 20 shares of Georgia Power Company 6 per cent. preferred stock; 50 shares of Eagle Phoenix Mills of Columbus, Georgia; 10 shares of Thomaston Cotton Mills, Thomaston, Georgia, 6 per cent. preferred stock; 10 shares of American Bakeries stock; and 10 shares of Continental Gin Company of Birmingham, Alabama, preferred stock — all of the par value of $100 a share.” When by this transfer the defendant “took legal title to said stocks . . he held same as constructive trustee thereof for the benefit of your petitioners,” for the reasons then alleged. Said stocks were exchanged by Mrs. Hart for 325 shares of common stock of Progressive Insurance Company of Atlanta, Georgia, on March 18, 1933, in a transaction with P. Gilliland, by reason of her complete reliance on his representations to her that said insurance corporation stock “had paid . . and was paying dividends,” and would pay a dividend on July 1, much greater than that on all the other stocks which petitioners thus swapped for that stock; that the insurance corporation stock had “a greater market value than the stock which petitioners were swapping for it;” that said corporation was doing business as a life insurance company; and that “some of petitioners’ stocks were worthless, and . . the others would soon become worthless.”
It was further alleged: Said “transfer and exchange of said . . insurance corporation common stock was a sale or exchange executed in behalf of the defendant” by said Gilliland; and he, “in executing said sale or trade of said securities, was acting in behalf of the defendant, and within the scope of his authority.” The “defendant caused said stoсks . . to be sold, and the proceeds of said sales have been unaccounted for by the defendant to petitioners, as it was his duty to do.” Petitioners “do not know how much defendant obtained as proceeds, . . but charge that defendant did not receive less for said stocks than was their market value on the day legal title to same was acquired by the defendant from petitioners,” and on said date the fair market value of said Georgia Power Company stock was $53 a share, a total of $1060, Eagle Phenix Mills stock $75 a share, total $3750, Thomaston Cotton Mills stock $30 a share, total $300, American Bakeries stock $90 a share, total $900, and Continental Gin Cоmpany stock $35 a share, total $350. The petitioners charge, that during said negotiations Gilliland, the defendant‘s agent, learned that petitioners owned 11 United States Government bonds of $1000 each; that a few days later, on March 20, 1933, after said first exchange, the defendant personally came to see petitioners, induced them to swap said bonds for 11 bonds of Fulton Industrial Securities Corporation for $1000 each, and completed this transfer
The petition alleged further assurances by the defendant: that he told them “he was a very wealthy man who had a large stock and bond business in Atlanta, and that he did not want to make any money off the petitioners, but was really interested in [their] welfare and wanted to assist [them] in realizing more money from the securities which [they] owned;” that “he had bought [said] Industrial Securities Corporation bonds and Progressive Insurance Holding Corporation stock for his own mother, and that petitioners could rely on him entirely when he stated to petitioners that said Progressive Insurance Holding Corporation stock and said . . Industrial Securities Corporation bonds were proper investments for petitioners, and of much greater value than the stocks and bonds previously owned by petitioner.” “Defendant stated to your petitioners, . . he would look after all of petitioners’ investments and could advise [them] when to sell the securities which he had traded them, and that they need look no further for advice or help to any one, but could always rely on him for direction and advice;” that “they could rely on him completely to handle their business affairs with reference to these securities, and that they
The petition stated a further transaction around Christmas, 1933; that “J. O. Spaulding and W. E. Martin came to your petitioners’ farms with the express purpose of swapping said Fulton Industrial Securities Corporation bonds for securities which they stаted were safer, sounder, and paying large dividends,” the “common stock of Pacific States Life Insurance Company;” that they told petitioners “said bonds were `loan-shark bonds’ and . . the legislature was about to put the `loan-sharks’ out of business and would ruin these bonds, and . . there was no time to lose in getting what petitioners could out of said bonds before they lost everything they had put in said bonds,” and stated that “they were in a position to swap to petitioners 110 shares of the common stock of [said] insurance company,” and “represented that said . .
The petition seeks to charge Grant with liability in this last transaction, by the following averments: that said acts and representations “were made . . to put into effеct an agreement made between said Spaulding and Martin and the defendant before said Spaulding and Martin effected said swap,” which agreement was that “defendant Grant would direct [them] to said petitioners, so that said Spaulding and Martin could trade petitioners out of said
Petitioners state that from the stock and bonds exchanged for their original securities they have received the following amounts: from stock of Progressive Insurance Holding Corporation, a liquidation dividend of $81.25, paid May 30, 1936, as a result of its receivership; from Fulton Industrial Securities Corporation bonds, at 7 per cent. per annum, $193.50 on May 1, 1933, $193.50 on August 1, 1933, and $193.50 on November 1, 1933, a total of $580.50; $560.45 paid on January 16, 1934, by Spaulding and Martin, as above stated; and that “petitioners did not know the fraud herein charged to defendant at the time they or either of them received said payments.” It is further alleged, that in order to do equity the petitioners tendered back to the defendant $1755, representing all sums received by them through said transactions, plus 7 per cent. interest thereon from the dates received, and tendered back in kind said 325 shares of Progressive Insurance Holding Corporation stock, and said 110 shares of Pacific States Life Insurance Company stock, “said stock certificates at the time of said tender being properly endorsed by petitioners in blank,” but that the defеndant refused said tender, refused to account for the proceeds of said stocks and bonds, and denied any liability. In the petition they “continually tender to the defendant said stock certificates . . and said $1755, . . and state that they are agreeable that any decree or judgment . . against the defendant be conditional upon said payment and transfer by petitioners or offset in an amount equal to said $1755 and the transfer of said stock certificates or any other sums or property which this court may find due by petitioners to defendant.”
The defendant assigns error on the overruling of his general and special demurrers on the grounds indicated in thе syllabus. Only the ruling in division 8 of the syllabus, relating to the statute of limitations and laches, requires elaboration. The
Cases applying a seven-year period of limitation to suits which sought to enforce an implied trust for recovery of land seem to be based on a different rule, to wit, that an adverse holding for seven years under color of title will preclude its recovery, the same as in an action of ejectment. See, in this connection, Wallace v. Mize, 153 Ga. 374, 383 (112 S.E. 724);
(a) However, the defendant insists that even though a period of limitations may have been fixed by statute, this time should be reduced by the equitable doctrine of laches (
(b) As to what averments would be necessary to show such laches, the rule was stated in Citizens Southern Bank v. Ellis,
Under the preceding holdings, and in the absence of averments bringing the petition within these rules as to laches, the action was not barred by lapse of less than seven years from the accrual of the cause. The court did not err in overruling the grounds of demurrer, raising the defense of the statute of limitations and laches.
Judgment affirmed. All the Justices concur.