Knapp v. Knapp

EDMONDS, J.

The appellant asserts that he has a canse of action for the recovery of his share of the proceeds from the sale of certain real estate once owned by him and his brother, Charles W. Knapp, one of respondents. He sued to secure an accounting and exemplary damages. The demurrer to his complaint was sustained without leave to amend, and the judgment appealed from followed that order.

The amended complaint alleges the following facts: The appellant and Charles W. Knapp are brothers. In 1911 they were the sole owners, in equal undivided shares, of certain real property, record title to which was taken in the names of the brother and his wife, who took the title to the appellant’s undivided one-half interest as trustee for him. Shortly thereafter the appellant left California and since has not been in the state.

About January 1, 1917, the respondents represented to the plaintiff, who was then in Illinois, that they had sold the property for the sum of $4,000 and forwarded to him a promissory note for $2,000 endorsed across the face: “In full settlement for J. H. Knapp’s interest in Cucamonga Cal. orange grove which was owned by payer and payee hereto.” According to its terms, the holder might extend the time of payment without notification to the maker.

By other allegations, the appellant charges that he believed these representations and accepted the promissory note. However, as he now knows, the representations were in fact untrue, and the note was sent- to him as part of a fraudulent scheme on the part of the respondents to abscond with the money realized from his interest in the sale of the property from which they realized more than $10,000. The true facts concerning the sale of the land were only discovered by him about October 1, 1938, during the preparation for trial of a suit upon the promissory note. Until that time, he says, he had “no knowledge, information or suspicion of the falsity of said representations, nor of the existence of any of the facts or circumstances in connection with the transaction

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In addition to the demand for an accounting, the appellant asks judgment for $20,000 as exemplary damages.

The respondents demurred upon a number of grounds. They specify that the action is barred by section 338, subdivision 4, section 343, and section 339, subdivision 1, of the Code of Civil Procedure; that the plaintiff has been guilty of laches; that there is another suit pending between the same parties for the same cause; and that there is a misjoinder of parties defendant, in that it appears from the complaint that Florence R. Knapp never had any interest in the property. As against these contentions, the appellant asserts that in the case of a voluntary trust, the statute of limitations does not commence to run until the equitable owner acquires knowledge of its repudiation, and that mere lapse of time does not affect the rights of the equitable owner. lie also maintains that the three-year statute limiting action for fraud or mistake has not run upon his cause of action because he filed suit within ten days after his discovery of the facts constituting the fraud.