Raynsford v. Great Western Power Co.

THE COURT. This is an action to recover damages arising out of alleged fraudulent representations made by defendants with respect to the sale of shares of stock. The issues were tried before the court, findings were duly entered in favor of plaintiffs upon all of such issues, and judgment was rendered against defendants in the sum of $1470. The appeal is taken from the judgment.

Plaintiffs also appeal from “that part and portion of said judgment in which the trial court found, determined and adjudged that plaintiffs were not entitled to recover interest from defendants on interest payments, from the respective dates of payment, paid by plaintiffs and received by defendants on account of the purported purchase of stock of defendant Western Canal Company”.

This case is companion to Goodspeed et al. v. Great Western Power Co. et al. (Civ. No. 6011), decided by this court on the 8th day of June, 1939 (33 Cal. App. (2d) 245 [91 Pac. (2d) 623, 92 Pac. (2d) 410]). It arises out of the same general situation, and presents the same issues, with the exceptions hereinafter noted. We refer to that opinion for a statement of facts. We also adhere to that opinion upon all questions expressly disposed of or necessarily involved therein. Only questions not raised in that case will receive our attention here.

The questions of the right of plaintiffs to recover generally upon substantially the same record, and the right to interest and damages, are fully disposed of in the Goodspeed case mentioned above, with the sole exception of the contention here made that such recovery is barred by the statute of limitations. Since the argument of this cause, and with the permission of the court, defendants have also filed a “statement of constitutional grounds for not following the Goodspeed case”, in which case, however, that question was hot presented for our consideration. The latter question is disposed of in the West case (Civ. No. 6145) (ante, p. 403), and reference is made to that case for an extended discussion.

It is the contention of defendants that the action is barred by the provisions of section 338, subdivision 4 of the Code of Civil Procedure, in that the evidence is insufficient to sup[432]port the finding to the effect that the discovery of the fraud upon the part of plaintiffs was made within three years prior to the commencement of the action. The law relating to this matter is set forth in the opinion in the case of West v. Great Western Power Co. et al. (Civ. No. 6145) (ante, p. 403 [97 Pac. (2d) 1014), a companion case filed this day, and it is unnecessary to discuss it further here. Most of the brief upon this question in this action is a reprint from the opening brief of appellants in the West case, but certain additional facts are relied upon here as constituting constructive notice of fraud, and we shall proceed to discuss them.