Opinion
SC 892.
March 27, 1975. Rehearing Denied April 24, 1975.
Appeal from the Circuit Court, Mobile County, William D. Bolling, J.
Pillans, Reams, Tappan, Wood, Roberts Vollmer, and Geary A. Gaston, Mobile, for appellant.
Fraud is alleged with particularity as is required by ARCP 9(b) when the pleading shows time, place and the contents or substance of the false pretenses, the fact misrepresented, and an identification of what has been obtained. ARCP 9(b) and Committee comments thereto. A complaint states a cause of action for fraud where the complaint states the fraud with particularity and alleges damage to the plaintiff, misrepresentation of a material fact made willfully to deceive or reckless without knowledge, and that the misrepresentation was acted on by the plaintiff. ARCP 9(b) Title 7, § 108, § 109, Code of Alabama (1940) (Recompiled 1958). In actions seeking relief on ground of fraud the statute of limitations is one year from the discovery of the fact constituting the fraud and the question of when the fact constituting the fraud was discovered is for the jury. Title 7, § 42, Code of Ala. (1940) (recompiled 1958). Lock Ridge Construction Co. v. Barra, 291 Ala. 312, 280 So.2d 245 (1973); State Security Life Ins. Co. v. Henson, 288 Ala. 497, 262 So.2d 745 (1972).
Marr Friedlander, and Daniel G. Sayers, Mobile, for appellees.
Complainant in suit to recover property alleged to belong to church had burden of avoiding bar of statute of limitations. Davis v. Stokes, 214 Ala. 234, 107 So. 76. Under this section parties seeking to rescind contract for fraud had burden of proving that discovery of fraud occurred within twelve months before bringing of action. Southern Buildings, etc., Association v. Waldrop, 24 Ala. App. 362, 135 So. 418. A complainant seeking to bring himself within the one year exception has the burden of averment and proof of failure to discover the fraud by the exercise of due diligence. Tarlton v. Tarlton, 262 Ala. 67, 77 So.2d 347. Where it appeared on the face of a bill by guardian that cause was barred by limitations, burden was on guardian to aver facts to take case out of statute or excuse the delay. Spann v. First National Bank of Montgomery, 240 Ala. 539, 200 So. 554.
This appeal is from a judgment dismissing, with prejudice, the complaint as last amended.
The plaintiff-appellant, Board of School Commissioners of Mobile County, filed the original complaint on January 19, 1971. Three of the six counts alleged that on either November 14, 1969, or November 17, 1969, the defendants-appellees, roofing subcontractors engaged in making repairs at several schools operated by the Board, supplied the general contractor with false statements for labor and material furnished in doing the work, and that the Board relied upon the misrepresentations in those statements and paid the general contractor.
The other counts allege that in June, 1969, the Board entered into a contract with the same general contractor for the renovation of kitchens in four schools; and, during August, September, and October, 1969, the general contractor submitted bills which overstated the amounts due under the contract. The defendants are alleged to have subsequently falsified and backdated bids for work performed for the general contractor to enable the general contractor to perpetuate a fraud on the Board.
The demurrer filed to the original complaint was sustained.
There were four amendments to the complaint, three of which were substantially total restatements of the plaintiff's claims. The last amended complaint was filed on January 4, 1974. The A.R.C.P. having become effective, the defendants filed a motion to dismiss pursuant to A.R.C.P. 12(b)(6).
Following argument by counsel, an order was entered on March 29, 1974, granting the motion to dismiss and allowing the plaintiff until June 1, 1974, to further amend. There being no further amendment, on June 7, 1974, a judgment was entered dismissing the action with prejudice.
Among the grounds of their motion to dismiss, the defendants averred that it affirmatively appeared from the complaint that the plaintiff's claims were barred by the statute of limitations. As we agree, it is unnecessary to consider other grounds of the motion.
An action for fraud is subject to the one-year statute of limitations. Title 7, § 26, Code 1940. The running of the statute does not commence until the discovery of the fact constituting the fraud. Title 7, § 42, Code 1940. In the complaint on this appeal, all averments as to time are of dates more than one year prior to its filing.
In common law pleading, the allegations of time and place were generally immaterial. Use of the videlicet was commonplace and variances as to allegations of time and place were not prejudicial. With the adoption of A.R.C.P. 9(f), averments of time and place have become material.
This requirement is not as restrictive as it might first appear, nor is it contra to the liberality to be accorded the Alabama Rules of Civil Procedure. According to Wright Miller, Federal Practice and Procedure (1969): Civil § 1308, at 438, the Advisory Committee to the Federal Rules of Civil Procedure considered the requirement for pleading time and place with accuracy would enable an earlier identification and isolation of the transaction or event in issue and supply means for testing and adjudicating certain claims and defenses — the statute of limitations, in particular.
A.R.C.P. 9(f) does not require that time and place be alleged. See: Kuenzell v. United States, 20 F.R.D. 96 (N.D.Cal., 1957). It only requires that when the pleader does allege a certain time or place, it must be done accurately.
In this regard, Wright Miller, Federal Practice and Procedure: Civil § 1308, at 439, states:
"The most common application of Rule 9(f) takes place when the time pleaded in the complaint indicates that the suit is barred by the statute of limitations. Under the normal rules of pleading, statute of limitations is an affirmative defense and must be raised in the answer. Since Rule 9(f) makes allegations of time material, however, the defense of the statute may be raised on a motion to dismiss under Rule 12(b)(6) when it is apparent from the face of the complaint that the time limit for bringing the claim has passed. Thus, although Rule 9(f) apparently was designed simply to require a higher level of information in the pleadings, the federal courts have employed the rule as a screening device for timebarred claims and this seems consistent with the general policy set forth in Rule 1 of achieving a just, speedy, and inexpensive adjudication of disputes."
See Kincheloe v. Farmer, 214 F.2d 604 (7th Cir., 1954), cert. den. 348 U.S. 920, 75 S.Ct. 306, 99 L.Ed. 721 (1955).
With respect to allegations of fraud, in Moviecolor Limited v. Eastman Kodak Co., 288 F.2d 80 (2nd Cir., 1961), cert. den. 368 U.S. 821, 82 S.Ct. 39, 7 L.Ed.2d 26 (1961), the court quoted from Stearns v. Page, 7 How. 819, 12 L.Ed. 928 (1849), saying:
". . . Even under modern liberal rules of pleading 'justice' still requires that a plaintiff seeking to escape the statute in such a case shall make 'distinct averments as to the time when the fraud, mistake, concealment, or misrepresentation was discovered, and what the discovery is, so that the court may clearly see, whether by the exercise of ordinary diligence, the discovery might not have been before made.' . . ." (288 F.2d at 88)
And in Associates Financial Services Co. v. First National Bank of Mobile, 292 Ala. 237, 242, 292 So.2d 112 (1974), this court said:
". . . we are of the conclusion that a plaintiff in a fraud action seeking to invoke the 'saving' clause (permitting the filing of a suit within one year after the discovery) in order to withstand a motion to dismiss, should show the time and the circumstances of the discovery of the alleged fraud. This observation is not to be construed as in any manner obviating the operative effect of Rule 15(b) relating to amending the pleadings to conform to the evidence."
Here, as in McGruder v. B L Construction Company, Inc., 293 Ala. 354, 303 So.2d 103 (1974), there was a hearing on the motion to dismiss; and, while granted time in which to do so, the plaintiff chose not to amend further. Applying Rule 9(f) in granting defendants' motion to dismiss was not error and was in keeping with the purposes of the Alabama Rules of Civil Procedure.
The judgment of dismissal was correct; it is, therefore, affirmed.
Affirmed.
HEFLIN, C. J., and MERRILL, MADDOX and JONES, JJ., concur.