San Filippo v. Griffiths

Opinion

This appeal concerns the issue whether the three-year statute of limitations for actions “for relief on the ground of fraud” (Code Civ. Proc., § 338, subd. 4), or the four-year statute for “An action upon any contract, obligation or liability founded upon hn instrument in

Thereafter the superior court sustained James’ demurrer to Virginia’s complaint, without leave to amend. The action was thereafter, on February 13, 1969, dismissed.

On September 29, 1970, Virginia commenced action numbered 244633 against James. This time the complaint was entitled “Complaint for Fraud,” but along with allegations of fraud it also sounded in breach of contract as did the complaint of the previous action. A demurrer to the complaint was sustained without leave to amend, and the action was dismissed on December 9, 1970.

On April 17, 1972, yet another action was brought by Virginia against James. It was numbered 271643, and entitled: “Complaint to Set Aside Property Settlement Agreement and for Breach of Fiduciary Duties.” Its purpose, and allegations, were substantially the same as those of its immediate predecessor actions numbered 212671 and 244633. This action, it will be noted, was filed more than three, but less than four, years after commencement of action 212671 in which Virginia first sought relief from the alleged nondisclosure and understatement of valuation of community property. James’ demurrer to the complaint in this action was also sustained without leave to amend, and on May 9, 1972, an order of dismissal of the action was entered. Virginia appealed from that order of dismissal. .

By an unpublished decision and opinion, which became final June 25, 1973, Division Four of this court concluded that the complaint of Virginia’s action 271643 stated “a cause of action for extrinsic fraud warranting possible equitable relief;” or that at least its complaint could be amended so to do. Holding that “the demurrer was improperly sustained without leave to amend,” the appellate court ordered: “The judgment is reversed, with directions to the trial court to grant appellant a reasonable time within which to file an amended complaint.” We

Thereafter Virginia filed an amended complaint in action 271643, entitled: “Amended Complaint: To Set Aside Or Modify Divorce Judgment Provisions; and For An Accounting Of Community Assets; and For Breach of Fiduciary Duties.” The gist of the action, seeking to enforce the promises of James in the “Property Settlement and Separation Agreement,” remained unchanged. His demurrer being overruled, James filed an answer to the amended complaint. He thereafter commenced proceedings in the action for a summary judgment. The summary judgment was granted June 24, 1974, and the action was dismissed July 5, 1974, on the ground “that there is no triable issue as to the fact that the action is barred by the three year Statute of Limitations of Code of Civil Procedure Section 338(4) of this State.”

The appeal presently before us is taken by Virginia from the summary judgment.

If Virginia’s action 271643 was an “action for relief on the ground of fraud,” the summary judgment was proper. For she must be deemed to have known of the facts constituting the “fraud” at the time of the filing of her first action for relief (action 212671), more than three years before commencement of the instant action 271643. (See fn. 1, ante.)

But as we have pointed out, a portion of Virginia’s action simply rests upon James’ contractual promise to pay her 50 percent of the value of community property not disclosed to her at the time of the agreement. That part of the action is patently not “for relief on the ground of fraud;” its purpose is to enforce the agreement, and the appropriate statute of limitations is four years, under Code of Civil Procedure section 337, subdivision 1. (See fn. 1, ante.) To this extent, at least, the entry of the summary judgment was erroneous.

We are brought to the remaining question, whether the action—as it seeks to enforce James’ written agreement to pay Virginia 50 percent of the value of community property in excess of the value as allegedly wilfully understated by him—is for relief on “the ground of fraud,” or is an action on a contract founded on an instrument in writing.

It is, of course, “the nature of the right sued upon and not the form of action nor the relief demanded [that] determines the applicability of the

The three-year limitation of Code of Civil Procedure section 338, subdivision 4, will apply when fraud is the “gravamen” of the action. (Day v. Greene, 59 Cal.2d 404 , 411 [ 29 Cal.Rptr. 785 , 380 P.2d 385 , 94 A.L.R.2d 802 ].) “[T]he modern tendency is to look beyond the relief sought, and to view the matter from the basic cause of action giving rise to the plaintiff’s right to relief.” (Leeper v. Beltrami, 53 Cal.2d 195 , 214 [ 1 Cal.Rptr. 12 , 347 P.2d 12 , 77 A.L.R.2d 803 ].)

In the case at bench, a fragment of Virginia’s cause of action is, as we have said, at least debatably touched upon by fraud. But nevertheless, the action in its entirety is founded on an express written contract, under which James agreed to pay Virginia 50 percent of the value of any undisclosed community property or community property value. It must, in reason, be said that the gravamen of Virginia’s action is an “obligation . . . founded upon an instrument in writing” (Code Civ. Proc., § 337, subd. 1), and not one founded on “fraud” (Code Civ. Proc., § 338, subd. 4).

To be sure some cases have held, where rights arising out of fraud and contract are blended, that the statute of limitations on an express contract begins to run upon “the discovery, by the aggrieved party, of the facts constituting the fraud,” according to the three-year statute of Code of Civil Procedure section 338, subdivision 4. “[Wjhere an express contract was the subject of the action . . . the Supreme Court has held that fraud would toll the running of the statute on the cause of action for breach thereof. . . .” (Acme Paper Co. v. Goffstein, 125 Cal.App.2d 175 , 179 [ 270 P.2d 505 ]; and see Gregory v. Spieker, 110 Cal. 150 , 153 [ 42 P. 576 ]; Souza & McCue Constr. Co. v. Superior Court, 57 Cal.2d 508 , 511 [ 20 Cal.Rptr. 634 , 370 P.2d 338 ].) In those cases the otherwise applicable four-year statute was extended because of the fraud; no case has been brought to our attention, and we find none, where the four-year statute for an action on a written contract was shortened because of related fraud.

Other authority is of assistance to us.

Where title to one’s property has been clouded by a judgment through the fraudulent act of another, in an action against that other, “the gravamen of the action is that the judgment is a cloud upon [the] title”

From all of the foregoing we conclude that the gravamen of Virginia’s action is the enforcement of the parties’ written agreement of July 30, 1968, and that she has pleaded, although in a manner subject to improvement, a cause of action therefor. Since the four-year statute of limitations of Code of Civil Procedure section 337, subdivision 1, is applicable to such an action, it follows that the summary judgment was erroneously entered.