Title: Calvert v. Swinford
Citation: 2016 OK 100
Docket Number: 
State: Oklahoma
Issuer: Oklahoma Supreme Court
Date: October 4, 2016

Calvert v. Swinford Annotate this Case Justia Opinion Summary Plaintiffs-appellants, sisters, Lisa Calvert and Teresa Roper were attorneys in fact for their father, Allen Downy, under a durable power of attorney. He owned Oklahoma real property which included mineral interests. In 2000, acting as attorneys in fact for their father under a durable power of attorney, the sisters entered into an agreement to sell the property (surface only) with Wayland and Dawn Swinford (grantees). The sisters retained Kansas attorney, Randee Koger and his law firm, Wise & Reber (then named Bremyer & Wise) to represent them as their legal counsel and to prepare legal documents in connection with the real property transaction. The sisters also retained Powers Abstract Co., Inc., an Oklahoma abstract company, to perform abstracting and closing functions for the sale of the property. Plaintiffs sold the Oklahoma property, allegedly intending to keep their mineral interests in the property. Twelve years after the deeds were filed, the sisters realized that mineral interests were not reserved and they filed a lawsuit for professional negligence against the abstract office. The abstract office moved for summary judgment arguing that the lawsuit was untimely, which the trial court granted. The issue presented for the Supreme Court's review centered on the dispositive issue of whether the statute of limitations for an action brought by a grantor begins to accrue when a deed is filed with the county clerk. The Court held that it did: any action for negligence regarding the mistaken deeds began to accrue when the deeds were filed. As such, the trial court was affirmed. Read more Want to stay in the know about new opinions from the Oklahoma Supreme Court? Sign up for free summaries delivered directly to your inbox. Learn More › You already receive new opinion summaries from Oklahoma Supreme Court. Did you know we offer summary newsletters for even more practice areas and jurisdictions? Explore them here . CALVERT v. SWINFORD 2016 OK 100 Case Number: 114957 Decided: 10/04/2016 THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. LISA D. CALVERT and TERESA ROPER, Plaintiffs, v. WAYLAND GUY SWINFORD AND DAWN ELYNN SWINFORD; NOCONA L. CARTER, AND BRIAN L. CARTER, ROGER D. WARDEN AND SUSAN WARDEN, BRANDON VAUGHN AND SERRA VAUGHN, FIRST NATIONAL BANK, JEREMY D. WOODS, CHRISTY S. WOODS, BLACK BEAR CREEK ENERGY COMPANY, LLC., ROUTE 66 MINERALS, L.P., SUNDOWN ENERGY, L.P. AND HIGHMOUNT EXPLORATION & PRODUCTION, LLC., Defendants. AND LISA D. CALVERT and TERESA ROPER, Plaintiffs/Appellants, v. MKB Royalty Corporation, Randee Koger, and Bremyer & Wise, LLC, Defendants, and POWERS ABSTRACT CO., Inc., Defendant/Appellee. APPEAL FROM THE DISTRICT COURT OF NOBLE COUNTY Honorable Phillip A. Ross, Trial Judge ¶0 The plaintiffs/appellants, sisters, sold real property in Noble County, but allegedly intended to keep their mineral interests in the property. Some twelve years after the deeds were filed, the sisters realized that mineral interests were not reserved and they filed a lawsuit for professional negligence against the defendant/appellee, the abstract office. The defendant filed a motion for summary judgment arguing that the lawsuit was untimely, and the trial court agreed and granted summary judgment. We retained the cause to address the dispositive issue of whether the statute of limitations for an action brought by a grantor begins to accrue when a deed is filed with the county clerk. We hold that it does. MOTION TO RETAIN PREVIOUSLY GRANTED; TRIAL COURT AFFIRMED. David R. Cordell, Hayley N. Stephens, Tulsa, Oklahoma, for Plaintiffs/Appellants. William J. Baker, Ky D. Corley, Steven M. Ruby, Stillwater, Oklahoma, for Third Party Defendant/Appellee Powers Abstract Co. KAUGER, J.: ¶1 We retained this cause to address the dispositive issue of whether the statute of limitations for an action brought by a grantor begins to accrue when a deed is filed with the county clerk. We hold that it does. FACTS ¶2 The plaintiffs/appellants, sisters, Lisa D. Calvert, an Illinois resident, and Teresa Roper, a Tennessee resident, (sisters/grantors/sellers) were attorneys in fact for their father, Allen Dwayne Downy, under a durable power of attorney. He owned Oklahoma real property which included mineral interests. The property is located in Noble County, Oklahoma.1 On October 29, 2000, acting as attorneys in fact for their father under a durable power of attorney, the sisters entered into an agreement to sell the property (surface only) with Wayland and Dawn Swinford (Swinfords/grantees).2 The sisters retained Kansas attorney, Randee Koger (attorney) and his law firm, Wise & Reber (then named Bremyer & Wise) (the firm) to represent them as their legal counsel and to prepare legal documents in connection with the real property transaction. The sisters also retained Powers Abstract Co., Inc., (Abstract Co.) a Perry, Oklahoma abstract company, to perform abstracting and closing functions for the sale of the property. ¶3 The contract provided that the sellers would "retain the mineral rights on the property for a period of thirty-five years (35) years or for as long as oil and gas are being produced from the property. At the end of such time the mineral rights shall revert to the then surface owner."3 The purchase price of the property was $62,000.00. On January 24, 2001, the sisters and their spouses entered into another agreement to sell additional real property to the Swinfords under the same terms and conditions of the as the October, 2000, contract.4 The contract price for this sale was $75,000.00. ¶4 Apparently, because of some undisclosed title defect issues, the closing was delayed until June of 2002, when the Abstract Co. mailed the sisters a packet of closing documents and deeds to sign. The deeds did not contain a reservation of any mineral interests. The sisters allege that they sent the packet to their attorney to review and he insists he corrected the deeds so that they each included a reservation of mineral interests. The conveyances for both transactions took place on July 20, 2002. Neither the sisters nor the attorney were present at the closing. Only the Abstract Co. and the Swinfords were present at the closing. The deeds were filed July 25, 2002, in the Noble County Clerk's office.5 The sisters never received a copy of the filed deeds from either the Abstract Co., or the attorney. The filed deeds did not reserve any mineral interests from sale. ¶5 On November 7, 2014, the sisters filed a lawsuit in Noble County, Oklahoma, against an MKB Royalty Corporation, an Oklahoma royalty corporation, Randee Koger, the Kansas attorney who handled the property transactions, and his McPherson, Kansas, law firm, Bremyer & Wise, and Powers Abstract Company, the Oklahoma abstract company who did the title work on the real property transaction in an attempt to recover their mineral interests which they thought they had retained. On August 14, 2015, the Abstract Co., filed a motion for summary judgement, arguing that the applicable statute of limitations had run because it has been more than twelve years since the deeds were filed. The sisters argued that the limitations period did not begin to run when the deeds were filed, but rather when they knew or should have known that negligence occurred. They contend that they didn't discover the mistake in the deeds until 2013, when they first became aware that the Swinfords were leasing the mineral rights. ¶6 The statute of limitations applicable to an action for negligence is found in 12 O.S. 2011 §95(a)(3) and it provides that such a claim must be filed two (2) years after the cause of action shall have accrued.6 The same statute provides a five (5) year limitation for deed reformation.7 On November 18, 2015, the trial court held a summary judgment hearing. At the hearing, the attorney for the Abstract Co. disclosed that the sisters had actual notice of the mistake in the deeds in 2003, because the Swinfords filed a quiet title action to the property in Noble County No. CV-2003-10, which resulted in a default judgment in favor of the Swinfords.8 The sisters, essentially ignoring the 2003 lawsuit filings, argued that: 1) the only purpose in filing a deed is to put third parties on notice of the deeds, not to put grantors on notice as to whether the deed comports with that they intended to convey; 2) the grantors were not under any duty to check the record to ensure they were correct; and 3) the quiet title action did not involve the Abstract Co. and was, therefore, inapplicable. ¶7 On April 5, 2016, the court filed an order granting summary judgment to the Abstract Co. It determined that the deeds, which were examined and signed by the grantors, gave the grantors constructive notice of any alleged mistake when they were filed of public record. Consequently, any claims of reformation and/or negligence were precluded by the long expired statute of limitations for either claim. The trial court also directed the filing of a final journal entry of judgment pursuant to 12 O.S. 2011 §994(a).9 ¶8 On May 3, 2016, the grantors appealed, arguing that summary judgment was premature because fact questions exist as to whether the statute of limitations had run. On appeal, the Abstract Co. argues that, in addition to the cause being untimely filed, an unpublished decision rendered by the Court of Civil Appeals in cause no. 113,558 in which the sisters sued Route 66 Minerals and Sundown Energy for unjust enrichment and quiet title and in which the Swinfords were also named defendants, precludes the sisters from bringing this lawsuit altogether. In cause no. 113,558, the Court of Civil Appeals held that the sisters' action for quiet title and unjust enrichment was time-barred, and it affirmed the trial court's grant of summary judgment. We retained this cause on May 25, 2016, to address the statute of limitation issue. THE STATUTE OF LIMITATIONS FOR AN ACTION BROUGHT BY A GRANTOR BEGINS TO ACCRUE WHEN THE DEED IS FILED WITH THE COUNTY CLERK. ¶9 The sisters argue that their lawsuit, brought more than twelve years after the deeds were filed with the county clerk, is timely because they did not discover the deficiency in their deed until 2013, within two years of filing their lawsuit. The Abstract Company disagrees, relying primarily on the Court of Civil Appeals opinion in Pangaea Exploration Corp. v. Ryland, 2010 OK CIV APP 66, 239 P.3d 160 as particularly persuasive as applied to this cause.10 The record also includes various other cases in which the same "timeliness" issue has re-occurred in Oklahoma Courts with differing results.11 Accordingly, we retained this cause to address the discovery/constructive notice issue and we do not address or express any opinion on whether the previous unpublished Case No. 113,558 Calvert v. Route 66 Minerals or whether the 2003 lawsuit filed by the grantees may also be dispositive of this cause.12 ¶10 The enactment of a statute of limitations is a legislative expression of a policy that prohibits litigants from raising claims after the expiration of a given period of time.13 Statutes of limitations are generally considered procedural defenses14 and are designed to prevent fraud and to protect litigants against stale claims.15 Exceptions to statutes of limitations are strictly construed and are not enlarged on consideration of apparent hardship or inconvenience.16 ¶11 A cause of action accrues when the injury occurs.17 However, Oklahoma also follows the discovery rule allowing limitations in certain tort cases to be tolled until the injured party knows or, in the exercise of reasonable diligence, should have known of the injury.18 The rule is applied to delay the running of the statute of limitations when doing so would not offend the purpose of the rule.19 It, much like the doctrine of adverse domination, arises from the inability of the injured, despite the exercise of due diligence, to know of the injury or its cause.20 The purpose of the rule is to exclude the period of time during which the injured party is reasonably unaware that an injury has been sustained so that people in that class have the same rights as those who suffer an immediately ascertainable injury.21 ¶12 The crux of this cause is whether the discovery rule should apply to toll the limitations period when a grantor alleges ignorance of the contents of the deed nearly twelve years after the grantor signed and filed it with the county clerk. The Legislature, by the enactment of 16 O.S. 2011 §16, has expressly provided that a recorded deed serves as constructive notice of its contents as to subsequent purchasers, mortgagees, encumbrancers, or creditors. The sisters point out that absent from the statute are "grantors." ¶13 Section 16 provides: Every conveyance of real property acknowledged or approved, certified and recorded as prescribed by law from the time it is filed with the register of deeds for record is constructive notice of the contents thereof to subsequent purchasers, mortgagees, encumbrancers or creditors.22 The statute does not expressly list a grantor as being included as the types of persons which a recorded deed provides notice of its contents. Several other states do, by statute, expressly state that a recorded deed serves as notice to everyone, including grantors of its contents.23 Nevertheless, this does not end the inquiry because, unless the Court applies the discovery rule to this cause, the limitations period has clearly expired.24 ¶14 In Samuel Roberts Noble Foundation, Inc. v. Vick, 1992 OK 140, ¶26, 840 P.2d 619 , the Court addressed whether the discovery rule should apply to professional negligence in construction. We followed the trend of sister jurisdictions who applied the discovery rule to negligence claims against architects and engineers. Quoting the 10th Circuit Court of Appeals,25 we stated that: There is no difference, in our view, as far as the wronged plaintiff is concerned, whether the negligence of the defendants was concealed or for some other valid cause the plaintiff failed to learn of the negligence, unless of course, the plaintiff, in the exercise of reasonable diligence, should have known of the negligence at the time of its occurrence. The Court has applied the discovery rule in similar types of actions where the negligence is not readily discoverable such as the repair of a storm damaged roof;26 the failure of a plumber to reconnect a sewer line;27 medical malpractice;28 damages to realty caused by pollution of a stream;29 damage to realty caused from an oil well;30 damage from the negligent installation of electrical wiring;31 libel, in actions where publication is likely to be concealed from the plaintiff or published in a secretive manner;32 breach of fiduciary duty;33 conversion or theft;34 and claim for recovery of stolen property.35 ¶15 The obvious purpose of applying the discovery rule to such actions is because: 1) the negligence was not readily discoverable by a plaintiff utilizing ordinary due diligence; 2) the negligence was hidden from being readily discoverable by the plaintiff; or 3) the plaintiff was prevented from knowing of it, and it did not become apparent until problems arose and the negligence was uncovered without any apparent negligence on the part of the plaintiff. This cause does not fall into those type of actions in which the discovery rule applies. ¶16 The rule has been applied in very limited real property cases in Oklahoma. For example, in Webb v. Logan, 1915 OK 354, ¶14, 150 P. 116, a Choctaw freedman, who could not read or write, agreed to deed a portion of her interest in real property. She was told that the deed only contained what she agreed to sell, but the defendant inserted additional property without informing the seller. Because fraud was perpetrated on the seller, the court held that she did not know or could not have known of the additional real property which was inserted in the deed. The circumstances of her ability not to read or write coupled with active fraud, allowed the discovery rule to apply. In other cases, where mutual mistakes were made as to the amount of mineral interests actually conveyed, the statute of limitation has been tolled in a few cases wherein circumstances warranted.36 These circumstances are not present in this cause.37 ¶17 Here, the sisters signed the deed. They had the opportunity and obligation to read or at least inquire as to what they were signing.38 The deed clearly did not reserve any mineral interests whatsoever. The deed was filed in the public land records office of the county clerk where the property was located. The deed was readily available to anyone who wanted a copy of it. A reasonable person would have read the deed before signing it, or at the very least, asked for a copy of it after it is signed and filed and then read it. Now, a copy of the filed deed can be secured anytime from one's computer in the comfort of their own home.39 ¶18 We stated in Board of Comm'rs of Garfield County v. Renshaw, 1909 OK 4, ¶6, 99 P. 638, relying on a Kansas case and English common law, that which still holds true today: Where the transaction is a matter of public record, either through conveyances registered as required by law or through other means, so that the party complaining has abundant means of finding out the fact of the transaction and its nature, there can be no concealment, and he will be charged with notice of the transaction and of facts which a diligent investigation thereof would develop. A party must be presumed to know what, by the exercise of reasonable diligence, he might have discovered; . . .40 No fraud is alleged nor is any concealment of facts or secretive publication.41 The alleged negligence was readily discoverable by a the sisters utilizing ordinary due diligence and not hidden from being readily discoverable by them. Nor were the sisters prevented from knowing of the negligence because it was not apparent. CONCLUSION ¶19 Although limitation issues may involve mixed questions of law and fact, they are ordinarily reviewed in this Court as questions of law.42 There exists a statutory presumption that a recorded signed document relating to title to real estate is genuine and was properly executed.43 The record supports but a single conclusion, that the statute of limitations began to accrue when the deed was filed and that the discovery rule is inapplicable to this cause. If this were not the case, real property transactions across the state could be set aside at almost any time which could leave all real property transactions unsettled indefinitely. Accordingly, we hold that, as a matter of law, any action for negligence regarding the mistaken deeds began to accrue when the deeds were filed. MOTION TO RETAIN PREVIOUSLY GRANTED; TRIAL COURT AFFIRMED. KAUGER, WATT, WINCHESTER, EDMONDSON, TAYLOR, COLBERT, GURICH, JJ., concur. REIF, C.J., not voting. COMBS, V.C.J., not participating. FOOT