Case Title: Heard v. COFFEY

Citation: 218 Or. 275, 344 P.2d 751

Docket Number: 

State: oregon

Court: Oregon Supreme Court

Date: 1959-10-07T00:00:00Z

Document:
Affirmed October 7, 1959.
*276 Wesley A. Franklin argued the cause for appellant. On the brief were Anderson, Franklin & O'Brien and Philip A. Levin, all of Portland.
Curtis W. Cutsforth argued the cause for respondents. With him on the brief were King, Miller, Anderson, Nash & Yerke and Mark C. McClanahan, all of Portland.
Before McALLISTER, Chief Justice, and WARNER, SLOAN and KING, Justices.
AFFIRMED.
KING, J. (Pro Tempore)
This is an action for damages for alleged fraud. The plaintiff charged that the defendants, who are in the business of writing health and accident insurance, induced the plaintiff to purchase a policy by means of certain misrepresentations regarding the coverage provided by the policy.
The alleged fraud took place on or about July 27, 1947, when the plaintiff purchased the policy. Plaintiff claims to have become totally disabled on July 31, 1954, and shortly thereafter discovered that her policy provided for the $100 per month total disability benefits only in the event that she was "continuously confined within doors and regularly attended therein at *277 least once a week by a legally qualified physician." She claims that this was contrary to the representations made to her by defendants' agent.
The defendants demurred to plaintiff's complaint upon the following grounds:
The lower court, after hearing, sustained the demurrer and, the plaintiff having declined after due notice to plead further, the court dismissed plaintiff's complaint with prejudice and entered judgment for defendants for their costs and disbursements.
The question for determination here is whether the complaint contained sufficient allegations to state a good cause of action and sufficient to bring it within the statute of limitations. If it failed in either condition, it is not sufficient.
The complaint alleges:
It will be observed from the complaint that approximately seven years and four days elapsed from the date of the alleged fraud, July 24, 1947, to the date of the alleged discovery, July 31, 1954; that approximately eight years, nine months and twenty five days elapsed from the date of the alleged fraud until the filing of the complaint on May 2, 1956.
The only allegation regarding the discovery of the alleged fraud is contained in Paragraph IV of plaintiff's *280 complaint. It alleges, in effect, simply that plaintiff made the discovery on or about July 31, 1954, when she became totally disabled and applied for total disability benefits. No reasons are set forth why an earlier discovery of the alleged fraud was not made. There was no allegation that reasonable, or any, effort was made to learn the terms of the policy, although it was in her continuous possession.
1. ORS 12.110 provides that an action at law for fraud or deceit must be commenced within two years from the discovery of the fraud or deceit. It was held in Linebaugh v. Portland Mortgage Co., 116 Or 1, 239 P 196, that the words "from the discovery of the fraud or deceit" as used in the statute meant "from the time the fraud was known or could have been discovered through the exercise of reasonable diligence."
2. The rule set forth in Linebaugh v. Portland Mortgage Co., supra, has been approved by this court in equity cases, including the early case of Wills v. Nehalem Coal Co., 52 Or 70, 96 P 528, where it was held:
See, also, State v. Warner Valley Stock Co., 56 Or 283, 106 P 780, 108 P 861, and City of Pendleton v. Holman, 177 Or 532, 164 P2d 434, 162 ALR 249.
In the recent case of Huycke v. Latourette, 215 Or 173, 332 P2d 606, decided by this court December 3, 1958, it was held that the equity rule as set forth above also applied to law actions for fraud and deceit. This court, in that case, said:
The court concluded by saying:
In the Huycke v. Latourette case the action was brought a little more than three years after the alleged fraudulent representations were made. In this case, as before mentioned, the action was brought almost nine years after the alleged false representations were made. The allegations as to "discovery of the fraud" are almost identical in both cases and neither give any explanation, and do not negative lack of diligence in discovery of the fraud.
3. The plaintiff's complaint in this case does not show any excuse for the delay in bringing this action. The circuit court properly determined the issue as a matter of law and sustained the demurrer. The complaint, on its face, showed that the statute of limitations had run before it was filed, and no facts were pleaded to toll the statute.
The judgment is affirmed.