82, which is easily accounted for by allow-by the court upon the ground that it was ances to the warning order attorney and obtained by fraud; and to this part of the to the master, and the costs due the clerk judgment appellant also complains upon this which had accumulated between the two appeal. sales. It is therefore apparent that the land was not sold for more than was necessary to be raised, and the presumption must be indulged that the master obeyed the instructions of the court and sold only a sufficiency of the land to pay the debts, costs, and allowances. This is especially true since the master's report of sale, which doubtless would disclose the fact made apparent by the above calculation, is not now in the record.

[8] 5. That the sale to the creditors and a conveyance to one of them as trustee for all was not a sale, but in effect a mortgage only, is a novel contention in support of which no authorities are cited. That this contention is untenable is apparent from the fact that the court has no authority to make such contract for the benefit of the heirs in the settlement of the estate of a decedent, the court's authority being limited to a sale in accordance with the statutory provisions; and there is no limitation upon the right of any one or more of the creditors to become purchasers at such sale. It is manifest, therefore, that the sale to all the creditors and a conveyance to one of them as trustee for all divested such of appellees as were parties to that action of all title and interest in the land sold and conveyed to the creditors, and they had no further interest therein.

Consequently they were not concerned with the subsequent orders of the court conveying to a new trustee for the creditors upon the death of a former trustee, and their consent was not necessary to such orders, and whether such orders were correctly or erroneously entered does not affect their interests or concern them in any way.

We therefore conclude that the judgment in the old case was not void, and the court erred in setting it aside.

In the petition to be made parties Amos Stewart, his brother, and two sisters stated that they were the owners of an undivided interest in the four tracts of land described in the original petition, which description they adopted as fully as if set forth in their petition; that it was of the rental value of more than $800 from the time that appellant has had it in possession and control; that they were entitled to share in the $2,150 paid into court by the Big Sandy Railway Company and the Carolina, Clinchfield & Ohio Railway Company for rights of way through these four tracts of land. It is apparent that Amos Stewart knew or by any kind of vigilance could have known what his interest in the land, if established, was worth, as well as his interest in the right of way money then in court. Yet, with this knowledge or the ready means of obtaining it, he conveyed his interest in the land to appellant for $100. The only semblance of fraud that was practiced upon him, according to his own testimony, is that appellant and his agent, Jessie Stewart, who is a brother of Amos and who conveyed his interest to Bentley for the same price represented to him that his claim to and interest in the land, if established after litigation which might be protracted, would be of little value to him after the payment of the debts against his father's estate and the costs of litigation, that, although he was born and had lived in the immediate vicinity until he was 13 or 14 years of age, he had since lived in West Virginia 247 miles from the land, and had been in Pike county but 4 days before he made the deed to appellant, and knew nothing of the value of the land or his interest therein; and that he was induced to make the conveyance by the fraudulent representations of his brother, who was acting as the agent of appellant, and of appellant as to the value of the land. When he was asked why he had executed the deed to Mr. Bentley for $100, he answered:

"He said that was the worth of it, and I didn't know any better. He said that there was know of any debts your father owed when he enough debts against it to take it. Q. Do you died? A. If he owed any debts, I don't know anything about it. Q. What efforts if any did Bentley make and what did he say to you to get you to sign the deed? A. He came to me three or four different times, and said $100 was all the land was worth. Said he couldn't beat me out of the land, and the only hope he had was to wear it out in court."

[9] 6. After the instant case had been prepared for trial and was ready for submission between the older set of Reuben Stewart's children and appellant, four of the five children of Reuben Stewart by his second wife filed a petition to be made parties, wherein they sought to recover their undivided interest in the land. As they were not parties to the old suit, and as it is conceded that they are the children and heirs of Reuben Stewart, it is manifest that their interest in the land, amounting to an undivided onetenth each, was not affected by the old suit, and that they were the owners of and entitled to recover their interest therein, and that the possession of appellant was not adverse This is the only evidence of any misrepreto them. However, after they had been made sentation of any kind, and it will be seen parties to the suit, all of the second set of that Bentley told Amos that he could not children, by deed, conveyed their interest in beat him out of the land, and that his only the land to appellant, but the deed from hope was to wear it out in court, and that

and for new trial, the trial court may pass up-
In a suit to set aside a default judgment
on the grounds for vacation of judgment before
deciding upon the sufficiency of the defense.
thereto; Civ. Code Prac. § 522, declaring that
the court may decide upon the ground to vacate
or to modify a judgment before deciding upon
the validity of defense to the cause of action.
3. LIMITATION OF ACTIONS 180(1)-PLEAD-
ING-DEMURRER.

only misrepresentation was as to the value | 2. JUDGMENT 463-ACTIONS TO SET ASIDE of Amos' interest in the land; and while -DETERMINATION. Amos said he did not know the value of his interest at the time he conveyed it to Bentley, he had theretofore filed his petition in this case to be made a party thereto, in which he had set out all the facts with reference to the land, its location, the condemnation by two railroads of portions thereof for rights of way, and that the railroads were being built through the land, and from his knowledge of these facts he was bound to know or could easily have ascertained the value of the land; and the only fact that his evidence tends to support is that he was willing at that time to accept $100 in hand rather than to await the uncertain period during which the litigation might be protracted. We do not, therefore, think that this testimony was sufficient to authorize the cancellation of his deed to Bentley.

[10] As said in German National Bank's Receiver v. Nagel, 82 S. W. 433, 26 Ky. Law Rep. 748:

"It is a well-settled rule that mere commendation, or even false representation, by the seller of property as to its value, when the purchaser has an opportunity to ascertain for himself such value by ordinary vigilance or inquiry, has no legal effect on legal rights of the contracting parties, even when made with the intention to deceive."

And the same rule would, of course, apply to representations of value made by the purchaser to the seller. See, also, to the same effect, Pomeroy's Equity Jurisprudence, vol. 2, § 893.

In Cyc. 336, it is said:

"The cancellation of an executed contract is an exertion of the most extraordinary power of a court of equity, which ought not to be exercised except in a clear case, and never for an alleged fraud, unless the fraud be made clearly to appear."

See Chicago Building & Mfg. Co. v. Beaven, 149 Ky. 267, 148 S. W. 37; Crawford & Gatlin v. Livingston, 153 Ky. 58, 154 S. W. 407, 44 L. R. A. (N. S.) 640.

Wherefore the judgment is reversed, with directions to dismiss the petition.

DAVIDSON et al. v. KENTUCKY COAL
LANDS CO.

(Court of Appeals of Kentucky. March 22,
1918.)

1. JUDGMENT 460 (4)

SETTING ASIDEPETITION-SUFFICIENCY. In an action to set aside a nunc pro tunc default judgment on the ground of fraud and for a new trial, a petition alleging that petitioner was joined as a formal party in a suit to locate a land patent, that subsequently the petition was amended so as to include a part of petitioner's lands, but that he was not given notice of such amendment, wherefore judgment was taken against him without his knowledge, held, on demurrer, to state a good cause of action.

The defense of the statute of limitations murrer. must be pleaded, and cannot be raised by de4. JUDGMENT 460(3) DILIGENCE SUFFICIENCY OF SHOWING.

for new trial on the ground of fraud, a showIn a suit to set aside a default judgment and ing that the judgment was rendered in 1909, that petitioner had no knowledge of the judgment until 1914, when he accidentally discovered its existence, that the indexes to the public records did not disclose such judgment, and that the papers in the case were apparently lost, was sufficient to establish diligence on petitioner's part.

Appeal from Circuit Court, Clay County.

Action by the Kentucky Coal Lands Company against Henry Davidson and others to vacate a default judgment, and for a new trial. From an order setting aside the judgment and granting a new trial, defendants appeal. Affirmed.

Cleon K. Calvert, of Hyden, for appellants. J. C. Jones, of Frankfort, and Rawlings & Wright, of Manchester, for appellee.

SETTLE, C. J. December 13, 1913, the appellee, Kentucky Coal Lands Company, brought this action in the Clay circuit court against the appellants, Henry Davidson and others, heirs at law of Samuel Davidson, deceased, to vacate a nunc pro tunc default judgment rendered against the appellee in that court May 14, 1909, in the case of Samuel Davidson v. O. H. Moffatt et al., in which appellee was a defendant; and also to obtain a new trial in the action asked on the ground of fraud practiced by the successful party in obtaining the judgment, which by Civil Code, § 518, subsec. 4, is made a ground for a new trial. Appellants filed a general demurrer to the petition, which was overruled by the circuit court; and upon their refusal to further plead, the court set aside the judgment in the former action, and granted appellee a new trial. From that judgment, this appeal is prosecuted.

So the question presented by the appeal for decision is, Were the allegations of the petition sufficient to authorize the granting of the new trial and consequent vacation of the judgment? It was, in substance, alleged in the petition that September 8, 1908, the action in equity wherein Samuel Davidson, the ancestor of appellants, was plaintiff and O. H. Moffatt and others, including the appellee, were defendants, was instituted, ostensibly, to recover damages for timber of the alleged

For other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes

"If appellee or his attorney had, before judg-|tion of the circuit court in ruling that the ment was rendered against Mrs. Hayden, said defense that the action was barred by the to her that she was made a defendant in the statute of limitations cannot be raised by action pro forma, and that they had no intention of making her responsible for the debt, or demurrer. had done or said anything to put her off her guard or prevent her from defending the action, such conduct would have entitled her to relief."

To the same effect are the following cases: Winkler v. Peters, 142 Ky. 83, 133 S. W. 1144; Kingsley v. Daniels, 157 Ky. 194, 162 S. W. 813; McCall v. Hitchcock, 9 Bush, 66. Tested by the rule laid down in the cases, supra, it is patent that the allegations of the petition authorized the overruling of the demurrer, and, prima facie, entitled appellee to the new trial granted by the circuit court.

[2] While it is apparent from the averments of the petition, taking them as confess ed on the demurrer, that appellee would have had and now has, if upon the trial yet to take place of the action in Davidson v. Moffatt et al., as to him, the fraud alleged is established by the evidence, a good defense thereto, the circuit court had the right to pass upon the grounds to vacate the judgment in the former action and to grant a new trial, before deciding upon the sufficiency of appellee's defense to that action. As that action had gone off the docket appellee, in urging in the present action the grounds set forth in the petition for a new trial, could not have presented or tendered an answer in the former action. This can be done, how ever, following the reinstatement on the docket of that action as directed by the judgment in the present action granting the new trial. In the meantime the defense to the former action, disclosed by the petition for the new trial, sufficiently apprised the court of its character to enable it to determine its validity. Besides, in an action for a new trial on the ground of fraud of the successful party in obtaining the judgment, the court is permitted by section 522, Civil Code, to follow this course. That section declares:

"The court may decide upon the grounds to vacate or modify a judgment before deciding upon the validity of the defense or cause of action."

This defense is one that must be pleaded by answer or other responsive pleading. By section 2515, Kentucky Statutes, it is provided that an action for relief on the

ground of fraud or mistake must be commenced within five years next after the cause of action accrued, and, by section 2519, the cause of action shall not be deemed to have accrued until the discovery of the fraud or mistake; but no such action shall be brought ten years after the time of making the contract or the perpetration of the fraud. In this jurisdiction it is now the well-established rule that in order for a party to avail himself of the statute of limitations, it must be pleaded. The question of limitation cannot be raised by demurrer. Yager's Adm'r v. Bank of Kentucky, 125 Ky. 184, 100 S. W. 848, 30 Ky. Law Rep. 1287; Swinebroad v. Wood, 123 Ky. 675, 97 S. W. 25, 29 Ky. Law Rep. 1202; Childers v. Bales, 124 S. W. 295; Baker v. Begley, 155 Ky. 234, 159 S. W. 691; Green County v. Howard, 127 Ky. 385, 105 S. W. 897, 32 Ky. Law Rep. 243; Jolly v. Miller, 124 Ky. 114, 98 S. W. 326, 30 Ky. Law Rep. 341. Moreover, taking as true the allegations of the petition it is manifest that appellee's action was brought within five years of the discovery by it of the fraud complained of and likewise within ten years of its perpetration.

[4] We are also of opinion that appellant's contention that the petition fails to show reasonable diligence upon the part of appellee in discovering the fraud and in bringing the action is without merit. The judgment complained of was rendered May 14, 1909, and the action instituted December 13, 1915. The facts furnished by the petition, from which we must determine the question of the appellee's diligence, or want of diligence, are as follows: Shortly after the rendition of the judgment complained of and in the same year, A. K. Cook, who was at the date of its rendition and for several previous It would seem, however, that to authorize years the attorney and agent of appellee inthe court to vacate or modify the judgment trusted with the control of its Kentucky before deciding upon the validity of the de- lands, and who admittedly was unadvised of fense or cause of action, the party seeking to the existence of the judgment, was relieved set aside the judgment on the ground of of further service in that capacity, and J. fraud must state in his petition sufficient C. Jones employed by appellee as its agent grounds to authorize the vacation or modi- and attorney with like duties and powers. fication of the judgment and the defense that Jones, beginning with the year 1910 and conhe could and would have interposed to defeat tinuing through the successive years down to the rendition of the judgment if he had not the fall of 1914, repeatedly searched the recbeen prevented by the fraud alleged, and the ords of the Clay circuit court for the puraverments of the petition must be supported pose of ascertaining what actions or litiga by evidence, unless, as in this case, the facts tion affecting appellee and its Clay county averred therein are admitted by a demurrer lands had been brought or were pending in to the petition. Gaar, Scott & Co. v. Van that court, but was at no time able to seHook, 162 Ky. 332, 172 S. W. 680; Martin v. cure any information touching the former Conley, 99 S. W. 613, 30 Ky. Law Rep. 728. pendency of the suit of Davidson v. Moffatt [3] Appellants cannot complain of the ac-et al., in which the judgment complained of

The defense was interposed that there was a defect of title, and, it so appearing to the court, a rescission was adjudged. The vendor afterwards discovered the necessary deed and filed her petition for a new trial, averring that the deed books and indexes had been so mutilated during the late war that it was impossible to find the deed without

was rendered, and did not learn of the ac- | Jones, in the fall of 1914, as alleged in the tion until the fall of 1914, when he acciden- petition. In Elliott v. Harris, etc., 81 Ky. tally secured information thereof from out- 474, the question as to what constitutes dilside sources, and thereafter found and ex-igence on the part of one seeking by petiamined the judgment in question indexed un- tion a new trial was considered. der the style of Samuel Davidson v. MoffattBoman Lumber Company, etc., the index not showing appellee to have been a party to the action or judgment; upon making the discovery mentioned he inquired of the clerk of the Clay circuit court for the papers in the action, and found that they were not in the office of the latter, but in the possession of one of appellant's attorneys. From the pa-examining the deed books leaf by leaf, and pers of the action finally obtained, he for that all possible diligence had been used. the first time discovered, as did the appel- In passing on this question the court said: lee through information conveyed by him the existence of the judgment; and by subsequent investigation, which he could not have sooner made, learned of the fraud which had been perpetrated by the appellant's ancestor, Samuel Davidson, deceased, upon appellee and its former agent and attorney, Cook, in procuring the judgment complained of. With the papers of the action out of the clerk's office, and, apparently lost, and the action so indexed as not to give any indication that appellee was a party thereto, we can but conclude that appellee was not chargeable with notice of the suit prior to the discovery of the fraud by its attorney, |firmed.

law, could have discovered the deed, because the "No amount of diligence, in the eye of the law does not require the appellant to do more than search for the deed, in the usual way, by aid of the indexes and aid of the clerk, whose in recording deeds. He was not bound to turn duty it is to index the deed books used by him page by page to find a deed embraced by so cumbersome a record, and she had the right to be content after having made reasonable search and failed to find it."

Finding no reason to disagree with the rulings of the circuit court upon any question raised by the demurrer, or error in overruling the demurrer, the judgment is af