169 A. 701 | N.J. | 1934
Appellant complains of an order restraining him from setting up the statute of limitations as a defense to an action at law, instituted against him by respondents, to recover moneys of respondents fraudulently appropriated by appellant to his own use. Appellant, an attorney-at-law, converted moneys turned over to him by respondents for the payment of installments on the principal of a mortgage covering a property owned by the latter. These payments by respondents to appellant covered the period beginning July, 1922, and ending June 30th, 1927. Respondents did not learn of appellant's unlawful appropriation of the moneys until May, 1930. Thereafter, and until the final hearing in a suit to foreclose the mortgage, appellant insisted that he was authorized *210 by the mortgagee to receive these moneys on his behalf. At the final hearing this asserted agency was repudiated by appellant, and shortly thereafter, on August 1st, 1932, respondents instituted the action at law.
Appellant maintains that there was no jurisdiction in equity for the making of the order complained of. This contention is without merit. The gravamen of the bill of complaint was that appellant's fraudulent conduct in appropriating the moneys to his own use, and in concealing the unlawful conversion of the moneys, was followed by a fraudulent representation, persisted in until final hearing of the foreclosure suit, that he was the duly authorized agent of the mortgagee for the collection of these moneys. Appellant's fraudulent conduct caused respondents to subject their claim to the bar of the statute of limitations, and equity will not permit him to hold the advantage thus obtained. This is a firmly established rule. In Howard v. West Jersey,c., Railroad Co.,
Courts of equity ordinarily act in obedience and in analogy to the statute of limitations, but they will not allow the bar of that statute to prevail where it would further manifest injustice. Lincoln v. Judd,
Appellant, by his fraudulent conduct, was responsible for respondents' delay in prosecuting their action. He is thereby estopped from setting up the statute as a defense. He will not be permitted to take advantage of his own wrong. Equity will interfere, although the cause of action may not have arisen out of a technically fraudulent act, if the defendant has employed any means to mislead the plaintiff, or to hide from him the fact that a cause of action has arisen. Holloway v. Appelget,
The delay in instituting the action, following the discovery of the fraud by respondents, does not disentitle them to equitable relief. When they learned that the payments in question had not reached the mortgagee, appellant maintained that he was the duly authorized agent of the mortgagee for the collection of the moneys, and until the disputed question of his authority was litigated they were not obliged to institute action against appellant. This delay was likewise occasioned by appellant's fraudulent conduct, and to permit him to have an advantage thereby would be unconscionable.
Order affirmed, with costs.
For affirmance — THE CHIEF-JUSTICE, TRENCHARD, PARKER, LLOYD, CASE, BODINE, DONGES, HEHER, PERSKIE, VAN BUSKIRK, KAYS, HETFIELD, DEAR, WELLS, DILL, JJ. 15.
For reversal — None.