Mathewson v. Naylor

BISHOP, J., pro tem.

Measured by the familiar rules applicable to motions for nonsuit (see 9 Cal. Jur. 557 et seq.), the evidence in this case would have supported a finding in favor of plaintiff's contention that she had been induced by defendant’s fraudulent representations to loan him considerable sums of money, and that her action was barred neither by the statute of limitations nor by the dis

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charge of the defendant in bankruptcy. The judgment of nonsuit appealed from must, therefore, be reversed.

While the theory upon which plaintiff’s complaint was constructed was that a fraud had been perpetrated upon her, even without the allegations of fraud, the complaint states facts sufficient to constitute a cause of action on a promissory note, and it is very clear that on this theory a case warranting judgment in the plaintiff’s favor was made out. The defendant, admittedly, had borrowed considerable sums from the plaintiff over a period of months, and had not repaid them, except in small part. Notes, providing for instalment payments, were given to evidence the indebtedness, and some of the instalments were overdue when the action was commenced. Were these all the facts, plaintiff plainly would be entitled to a judgment, not for the full amount prayed for in the complaint, but at least for what was due on the notes. At the time the motion for a nonsuit was made, the facts established by the pleadings and proof were those outlined above, and the trial court would have acted properly had he denied the motion.

However, a discussion between the trial judge and counsel followed the motion for a nonsuit, in which it was suggested that reliance be placed on the defense of bankruptcy rather than on the motion. The plaintiff had alleged in her complaint that the defendant, some time after the dealings between them, had filed a voluntary petition in bankruptcy. This, in his answer, the defendant admitted, adding that the bankruptcy proceedings had proceeded to the point where he had been adjudicated a bankrupt. As a special defense he again alleged that he had filed a voluntary petition in bankruptcy, that the claim on which this case is based had been scheduled, and that the plaintiff had had actual notice of it all. There was no allegation in the pleadings nor claim at the trial that an order discharging the defendant had been made. Indeed, following the suggestion that reliance be placed on the defense, “namely, the scheduling of the debt and discharging of bankruptcy”, no evidence in its support was introduced. The defendant’s counsel’s reply to the suggestion was the mistaken one that “that is admitted by the pleadings”. Later he stated that “the matter is still pending. Everything has been done up to the discharging that will take place in the District Court of the United