Opinion ID: 510022
Heading Depth: 2
Heading Rank: 2

Heading: Fraud and the Statute of Limitations

Text: 43 When one person defrauds another, there will be a delay between the time the fraud is perpetrated and the time the victim awakens to the fact. Accordingly, in a fraud case, the statute of limitations will not begin running until the date the fraud is discovered, or reasonably should have been. King v. Kitchen Magic, Inc., 391 A.2d 1184, 1186 (D.C.1978); see Richards v. Mileski, 662 F.2d 65, 71 (D.C.Cir.1981) (due diligence test applied to reasonableness of claimant's efforts to uncover existence of a claim). In some cases, most notably medical treatment cases, the running of the statute is tolled beyond the discovery date if the tortfeasor reassures the victim that the negative effects should be expected as part of the treatment, and if a reasonable person would believe such reassurances. See Page v. United States, 729 F.2d 818, 823 & n. 36 (D.C.Cir.1984). 44 At trial, there was evidence that Kropinski had realized, by 1976 or 1977, that he would not receive the benefits attributed to TM. Tr. 12/15/86 at 544-46 (Kropinski testimony). Also, defendants argue that as Kropinski asserts that he had been deliberately misled by his instructors when he began his study of TM in 1972, and as he began to each TM in 1976, Tr. 12/16/86 at 580-82, he must have known by then which, if any, of the TM claims were fraudulent. Therefore, they conclude, the statute must have begun to run by 1976. 45 Kropinski meets these arguments with evidence that when he complained of adverse physical and psychological effects, defendants assured him that something good was happening, and that he believed them, Tr. 12/15/86 at 407-08. He also asserts that he had been deprived of the ability to determine the source of the negative emotional, psychological and physical effects he was experiencing. See, e.g., Complaint at paragraphs 33-34. Thus, by analogy to the medical treatment cases, Kropinski argues that he reasonably accepted defendants' reassurances despite the negative effects. Consequently, his cause of action did not accrue until the fall of 1983 when he finally learned the falsity of defendants' representations and stopped practicing TM. 46 As the district court correctly noted when it denied defendants' motion for summary judgment, it was for the jury to decide when Kropinski discovered the fraud, or reasonably should have. But instead of presenting that question to the jurors, the court instructed them as follows: 47 Defendants contend that plaintiff's claims are barred by the statute of limitations. That is to say, that plaintiff ceased participation in the defendant's [sic] activities more than three years before suit was filed. This is an affirmative defense. If defendants have established this then you should find for the defendants as to all of plaintiff's claims. On the other hand, if plaintiff's evidence establishes some participation in or contact with defendant's [sic] activities after September 8, 1982, which is three years before suit was filed, then you should continue your consideration of these instructions. 48 Tr. 1/12/87 at 22-23 (Jury Instructions) (emphasis added). 49 These instructions are flawed because they fail to instruct the jury that the statute of limitations begins to run at the time when a prospective plaintiff knows or should know through the exercise of due diligence of [his] right to recover. Baker v. A.H. Robins Co., 613 F.Supp. 994, 996 (D.D.C.1985). See also Richards v. Mileski, 662 F.2d 65, 71 (D.C.Cir.1981) (The test of due diligence measures the plaintiff's efforts to uncover his cause of action against what a reasonable person would have done in his situation given the same information.). As the jury was improperly instructed, and as the defense made a timely objection, Tr. 1/9/87 at 42-44, we remand for a new trial on the fraud claim.