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May Day May Day 2001

A CHECK IS IN THE MAIL IS USUALLY BAD ENOUGH

Kline vs. Turner, Cal. App. Ct.

Talent agent Thomas H. Kline, representing the musical group, Miss Allen and Nem, entered into an agreement with Priority Records whereby Priority was to pay Kline
$50K (with another $50K due after completion of a master recording). On Friday Aug. 13, 1990 Kline dispatched a business associate, one Marion Knight, to pick up the first $50K. When he did not return Kline called Priority; he was told that, at Knight's insistence, the check had been issued to Knight. Wow! Kline was upset. Priority assured Kline it would stop payment on Monday, but later told him the check had been cashed on Friday. Subsequently Kline met Knight, who brandished a gun, threatened Kline and his family and told him to back off; he said he took the money to cover legal expenses.
(Those damn lawyers and their bills!) Prudence triumphed over valor and Kline did nothing. More than five years passed. Then on Feb. 2, 1996, Kline received a copy of this check with a bank stamp showing it had been cashed on Tuesday Sept. 4, 1990, not on Friday Aug. 31st. A day shy of three years later (Feb. 1, 1999) Kline sued for fraud. Priority moved for summary judgment arguing that the claim was time barred by the 3- year statute of limitations for fraud. Kline argued otherwise because he hadn’t found out about the fraud until Feb. 2, 1996. The trial court granted the motion and the appellate court (albeit with a strong dissent) affirmed.




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