Opinion ID: 1778476
Heading Depth: 1
Heading Rank: 7

Heading: whether smith's claims are barred by the statute of limitations.

Text: A. Whether the statute of limitations was tolled by the Fraudulent Concealment Statute. ¶ 7. The trial judge found that Smith's claims were barred by the statute of limitations because more than six years had passed from the date the funds were liquidated until the date this action was commenced. Smith claims that the statute of limitations was tolled by Mississippi's Fraudulent Concealment statute. The Mississippi Fraudulent Concealment statute reads as follows: If a person liable to any personal action shall fraudulently conceal the cause of action from the knowledge of the person entitled thereto, the cause of action shall be deemed to have first accrued at, and not before, the time at which such fraud shall be, or with reasonable diligence might have been, first known or discovered. Miss.Code Ann. § 15-1-67(1995). ¶ 8. This Court has interpreted an identical statute, § 2312 of the 1930 Mississippi Code, which allows tolling of the applicable statute of limitations in a case in which a defendant or any person in privity with a defendant fraudulently concealed a cause of action. Burton v. John Hancock Mut. Life Ins. Co., 171 Miss. 596, 604, 157 So. 525, 526 (1934). Since Franklin Funds did not commit the fraud, the question is whether Franklin Funds was in privity with Bernie III. ¶ 9. Smith claims that Bernie III was in privity with Franklin Funds pursuant to a dealer agreement between Franklin Funds and Raymond James, Inc. The agreement between Franklin Funds and Raymond James, Inc. provided that Raymond James and its representatives would market and sell Franklin Funds' securities and would in return receive commission on the sale of securities. Bernie III was a registered representative of Raymond James and benefitted from the dealer agreement when he bought shares of Franklin Funds for the Smiths. Smith claims that this mutual financial interest between Bernie III and Franklin Funds creates privity between them. ¶ 10. Franklin Funds contends that the fraudulent concealment statute does not toll the statute of limitations because Franklin Funds was not in privity with Bernie III. Franklin asserts that outside the realm of disputes involving property estates, the fraudulent actor must be acting in the scope of an agency relationship with the third party in order for the limitations period to be tolled against the third party. Franklin Funds maintains that Bernie III was acting as Smith's agent and not as an agent for Franklin Funds. ¶ 11. We hold that in order to toll the statute Smith must prove that Bernie III was in privity with Franklin Funds or acting as an agent of Franklin Funds. The record does not reflect sufficient facts to make this determination. For this reason, we reverse the summary judgment and remand this case for trial. ¶ 12. In addition, Franklin Funds asserts that Smith's claim of fraudulent concealment should be denied because Smith failed to plead fraudulent concealment with particularity. Franklin Funds notes that Mississippi Rule of Civil Procedure 12(b) requires that fraud be pled with particularity. Franklin Funds maintains that as a species of fraud, fraudulent concealment must also be pled with particularity. J. Geils Band Employee Benefit Plan v. Smith Barney Shearson, Inc., 76 F.3d 1245, 1255 (1st Cir.), cert. denied, 519 U.S. 823, 117 S.Ct. 81, 136 L.Ed.2d 39 (1996). This argument is brought for the first time on appeal. It is well settled that this Court will not address issues raised for the first time on appeal. Crowe v. Smith, 603 So.2d 301, 305 (Miss. 1992). Moreover, the statute of limitations is an affirmative defense. Our rule does not provide for a responsive pleading after the assertion of an affirmative defense. M.R.C.P. 7(a). The comment to Rule 7 states: Affirmative defenses in the answer are deemed denied or avoided, and a reply is required if the answer contains a counterclaim denominated as such. Otherwise, a reply is unauthorized and may be stricken or disregarded. Comment, M.R.C.P. 7. Fraudulent concealment raised in response to the statute of limitations defense is not to be plead at all. B. Whether the statute of limitations was tolled by the Discovery Rule. ¶ 13. Next, Smith contends that the statute of limitations was tolled by the discovery rule presented in Mississippi Code Annotated § 15-1-49(2) which states: In actions for which no other period of limitation is prescribed and which involve latent injury or disease, the cause of action does not accrue until the plaintiff has discovered, or by reasonable diligence should have discovered, the injury. Miss.Code Ann. § 15-1-49(2) (1975). ¶ 14. Smith asserts that a tort is not completed and the cause of action does not arise until the plaintiff employing reasonable diligence discovers the injury. Franklin maintains that if the Court adopts Smith's interpretation of § 15-1-49(2) then the statute would be broadened to allow any plaintiff who, for whatever reason, failed to discover his claim, to use the discovery rule to toll the statute of limitations. Franklin argues that this would effectively eliminate the words latent injury from the statute. ¶ 15. In Owens-Illinois, Inc. v. Edwards, 573 So.2d 704, 708-09 (Miss.1990) we held that the discovery rule will be applied to products liability cases. We opined that the cause of action accrues and the statute of limitations begins at the time the plaintiff can reasonably be held to have knowledge of the injury or disease. In Owens-Illinois, Charles Edwards was employed at the Ingalls Shipbuilding facilities in Pascagoula, Mississippi from 1940 to 1984. Owens-Illinois, 573 So.2d at 705. From the beginning of his employment until 1976, Edwards was routinely exposed to asbestos. On August 26, 1986 Edwards was diagnosed with an asbestos related disease. He filed suit against his employer, Owens-Illinois, Inc. on September 29, 1986. Owens sought summary judgement claiming that the statute of limitations had run since the last date Edwards was exposed to the asbestos which caused his injury. We applied the discovery rule to toll the statute of limitations and held that Edwards had a latent injury and that the statute of limitations did not begin to run until August 26, 1986, the date that he was diagnosed with the injury. ¶ 16. We note that the majority of jurisdictions have held that the discovery rule will not apply to actions involving conversion of negotiable instruments unless the defendant asserting the statute of limitations is involved in fraudulent concealment. [3] We hold today that the rule adopted by a majority of our sister jurisdictions is sound and should be applied in our jurisprudence. We therefore hold that the discovery rule is inapplicable in actions involving conversion of negotiable instruments unless the defendant asserting the statute of limitations is involved in the fraudulent concealment. C. Whether the Statute of Limitations is tolled by the Continuing Tort Doctrine. ¶ 17. Smith asserts that the Continuing Tort Doctrine should toll the statute of limitations. This Court defined the Continuing Tort Doctrine as follows: [W]here a tort involves a continuing or repeated injury, the cause of action accrues at, and limitations begin to run from, the date of the last injury, or when the tortious acts cease. Where the tortious act has been completed, or the tortious acts have ceased, the period of limitations will not be extended on the ground of a continuing wrong. A continuing tort is one inflicted over a period of time; it involves a wrongful conduct that is repeated until desisted, and each day creates a separate cause of action. A continuing tort sufficient to toll a statute of limitations is occasioned by a continual unlawful acts, not by continual ill effects from an original violation. Stevens v. Lake, 615 So.2d 1177, 1183 (Miss.1993)( quoting C.J.S. Limitations of Actions, § 177 at 230-31). Indeed, we opined that continuing or repeated injuries can give rise to liability even if they persist outside the time period for the initial injury, but we noted that the defendant must commit repeated acts of wrongful conduct. Stevens, 615 So.2d at 1183 ( citing Hendrix v. City of Yazoo City, 911 F.2d 1102 (5th Cir.1990)). We have held that we will not apply the continuing tort doctrine when harm reverberates from one wrongful act or omission. Id. ¶ 18. The Franklin Funds shares were liquidated in March of 1987. There was no other time at which the Franklin Funds were liquidated. Bernie III may have continued to conceal this act [4] , but there was only one act regarding Franklin Funds. Thus, if the Smiths were injured by Franklin Funds, they were only injured once. Therefore, the Continuing Tort Doctrine does not toll the statute of limitations. ¶ 19. Smith also maintains that the theory of equitable tolling tolls the statute of limitations in this case. The theory of equitable tolling provides that where a plaintiff's delay in filing is caused by the defendant's misrepresentation, the statute is tolled. Amburgey v. Corhart Refractories Corp., 936 F.2d 805, 810 (5th Cir.1991). The Fifth Circuit in Amburgey and many other cases has applied equitable tolling in situations involving actions against employers and the EEOC. [5] We do not find the theory of equitable tolling applicable in this case.