52 Colo. 132 | Colo. | 1911
delivered the opinion of the court:
The amended complaint in this action is voluminous. It contains about fourteen thousand words. A demurrer was sustained to this amended complaint. The action was dismissed at the cost of the plaintiffs, who have
"Executed in duplicate the day and year first above written.
“WITNESS:
“WM. M. BURRIS.
“T. A. HARDING.”
It appears from the complaint, that some time after the execution of this contract and the payment of the $350 called for, that the original judgment in the suit referred to in the contract was reversed by this court, in which it sustained the validity of the bonds and leases h.eld by William M. Burris and Henry Brandenburg upon
The plaintiffs here seek to recover a portion of the proceeds derived from the sale of some of these claims. According to the complaint, the judgment of reversal by this court appears to have been made during the month of September, 1900. Thereafter, in pursuance of the mandate of this court and on or about the 18th of February, 1901, said cause came oh again for hearing in the district court of El -Paso county, at which time there was a judgment and decree entered, which, among- other things, recites:
“Third, That since the rendition of said order and judgment of reversal, one Mattie B. Burris has succeeded to all the rights and interest of said William M. Burris and Henry Brandenburg, in and to the matters and things in controversy in this suit, and in, under and by virtue of said order, judgment and reversal, and ought to be substituted as cross-complainant herein in place of the said cross-complainants aforesaid. * * *
“It is therefore considered, ordered, adjudged and decreed by the court:
“1st, That the said Mattie B. Burris be, and she hereby is, substituted as defendant and cross-complainant in this action in the place and stead of said William M. Burris and Henry Brandenburg.”
This decree further provided that, within five days from that date, certain companies and persons make conveyances to Mattie B. Burris of all their right in and to the property, the fruits of which are here in controversy, and in and to other properties not involved herein; that
The plaintiff Nesting is alleged to be a part owner by purchase in the interest of the plaintiff Harding to the contract aforesaid. The prayer is for judgment .against the defendants for 133,000 shares of said stock, for an accounting, etc., and that Bernard be adjudged to hold the stock in trust for the plaintiffs, etc. The special demurrer raises the question of the statute of limitations, also that the complaint does not state facts sufficient to constitute a cause of action.
It is claimed by the defendants : First, .that-the contract under which recovery is sought is malum in se and no recovery can be had thereon. Second, that as the complaint pleads the judgment in full in the Anderson suit in favor of Mattie B. Burris, and since it was therein, affirmatively adjudicated, that she had succeeded to all the rights and interests of the original parties plaintiff, and the decree was never appealed from, that the alleged rights of the; plaintiffs in the present action, if any they had, were thereby .concluded. Third, that the alleged cause of action attempted to be pleaded .was barred by the. statute of limitations when the action .was brought-.
Section 4073, Rev. Stats, of. 1908, reads as follows:
“Bills of relief, in cáse Df the existence of a trust not cognizable by the courts of common law, and in all other cases hot herein provided for, .shall be filed within five j^ears .after the cause thereof shall accrue, and not after.”
It is contended by the plaintiffs that this is the statute of limitation which should apply. The contention of the defendants is, that while the action is barred under this .statute, according to the allegations of the complaint it is also barred under general section 4072, Rev. Stats, of 1908, which reads:
' “Bills for relief, on the ground of fraud, shall be filed within three years after the discovery by the aggrieved party, of the facts constituting such fraud, and not afterwards.”
We find it unnecessary to pass upon the three-year statute. According to the allegations of the complaint, the transfer or assignment of the interest of Burris and Brandenburg to Mrs.' Burris, and the decree declaring the assignment' valid, and her being the owner, being the frauds complained of, transpired over five years prior to the bringing of this action. :
Assuiningi without deciding, that the facts in-the case of Farris v. Wirt, 16 Colo. App., page 1, are applicable, and that this • is not' a proceeding for relief on the ground of fraud, but is a proceeding to enforce a trust in
• A purchaser from a trustee, in contravention of the trust, in no sense becomes thereby an express trustee; he becomes a trustee in invitum by construction of law. He is a constructive trustee. He holds' actually in his own right and in hostility to the world; but a court of -equity, as Judge Story says, will force a trust upon his conscience .and compel him to perform it or answer for its fruits.—2 Story's Eq. Jur., 12th Ed., Sec. 1257; 1 Perry on Trusts, 5th Ed., Sec. 172; 2 Pom. Eq. Jur., 2nd Ed., Sec. 1048; Robinson et al. v. Pierce et al., 118 Ala. 273; Smyth v. Oliver, 31 Ala. 39.
Such a trust is raised and enforced by a court of' equity as a principle of justice. It has attached to it none of' the attributes of an express trust.' The purchaser is charged for breaking up the trust and not because he has .agreed to execute it; but in either event, the remedy of the complainants was 'all in equity upon bill 'filed in' due season, regardless of which section of the statute of limitations was applicable.
•• In the case of M. S. & R. Cole v. Noble, 63 Texas, at page 434, it is said:
“In case of a constructive trust, which is born of fraud, and which presupposes from its beginning an adverse claim of right on the part of the trustee by implication, the statute will commence to run from the period at which the cestui que trust could have indicated his right by action or otherwise.” :
But it is contended, as the complaint alleges, that the plaintiff Harding had no actual knowledge of the assignment to Mrs. Burris or of the decree entered in her favor, that the five-year statute did not begin to run until such knowledge was brought home to his attention. This doctrine does not always apply to constructive trusts. • But, again assuming that this principle is applicable, here, and that upon account of the allegations in the complaint concerning the manner in which Mrs. Burris secured this title, that the statute did not commence to run until the plaintiff Harding had actual or constructive knowledge of such repudiation, we think it can avail him nothing.
The complaint sets forth in full the -decree entered by the district court in the Anderson case pursuant to directions from this court. It recognizes the validity of that decree. In fact it is necessary, if the plaintiffs recover, at all, to base their right upon the validity of the title secured to the property-by virtue of this decree. According to this decree Mattie B. Burris had become the exclusive owner thereof. According to the complaint, she made this claim herself at that time, and caused it to receive the sanctity of a decree of the district court, and we do not think that the complainants can now be allowed to say that this decree is valid in the part under which they seek to recover, and meaningless upon the question of her claim of ownership wherein this portion is detrimental to their contention. In other words, they allege, in substance, that by virtue of this decree, which became final, title was secured in her, yet, notwithstanding this, her adverse claim and holding thereunder were not in good faith, but for the use and benefit of her husband and
In Vol. 1, Herman on Estoppel and Res Judicata, in section 156, it is-stated:
“It is not always essential to the creation of an estoppel that the person should be a party to the record. One who instigates and promotes litigation for his' own benefit by employing counsel or binding himself for the costs and damages, will be bound by the litigation or procedure as much as the party to the record.”
While, ordinarily, it is true that the decree of a court binds only parties and their privies in representation or estate, yet the general rule appears to be that he who purchases during the pendency of a suit is held bound by the decree that may lie made against the person from whom he derives title.-—1 Story’s Eq. Jur., 12 Ed., Sec. 406; 25 Cyc. 1484, 1485; 21 Am. & Eng. Enc. of Raw, 596; Bennett on Lis Pendens, Sec. 320. This being the case, the same rule certainly ought to apply when it comes to the question of being charged with constructive notice of the result of the action.
Counsel for plaintiffs urge that Harding did not purchase the legal title of anything involved in the Anderson litigation, but that he thus became interested in the essential use only of the subject of the controversy, which beneficial use they, however, claim was the essential thing. In placing a construction upon a pleading, the substance of its allegations, and not the form, is to be looked at. We think it makes no difference whether the party intruding
We find nothing in the complaint that would appeal to the conscience of the chancellor to relieve him of his laches and failure to bring his action within the statutory period in a case of this kind, where the other party claiming open and notorious ownership went through all the trials concerning it, was compelled to raise large amounts of money for its relief, and especially so after the lips of the party who had made the contract with him had been sealed by death, thus preventing him from bringing forward his construction of it or his reasons for non-compliance with it. The complainants had the right to file their bill at any time after the commission of the alleged breach of trust; if they were entitled to what they contend for, after the decision of this court, it was their duty to have followed it up and ascertained as to its disposition at least within the period of the statute of limitatipn. To' disallow its defense would be to overrule that great and invaluable principle of equity which has stood for centuries requiring the student to be diligent; further, it would be to abrogate the statute itself.
The judgment is affirmed. Affirmed.