Opinion ID: 2628309
Heading Depth: 2
Heading Rank: 2

Heading: ockey's conversion claim is barred by the statute of limitations

Text: ¶ 33 Ockey also alleged a conversion claim against Lehmer and IMAI based on the 1993 stock transfers in which Lehmer accepted the stock of IMAI from two developers who defaulted on payments owed to the family. Rather than distributing the IMAI stock to the family according to their proportionate interest in the ranch property, Lehmer canceled the original stock and reissued stock that he sold to family members in order to raise the capital necessary for furthering development. The district court dismissed Ockey's conversion claim against Lehmer and IMAI, holding that it was barred by the statute of limitations. Because Ockey cannot invoke the equitable discovery rule, and because his conversion claim was filed after the three-year statute of limitations expired, we affirm the district court's holding. ¶ 34 The applicability of both the statute of limitations and the equitable discovery rule are questions of law, reviewed for correctness. [29] The subsidiary factual determination of whether Ockey knew or should have known about the alleged conversion is a question of fact that Ockey argues was not supported by the evidence. [30] Findings of fact ... shall not be set aside unless clearly erroneous.... [31] In determining the sufficiency of the evidence supporting the district court's findings, [w]e review the evidence in a light most favorable to the trial court's findings and affirm if there is a reasonable basis for doing so. [32] ¶ 35 The district court found that Ockey's conversion claim accrued on July 1, 1993. The statute of limitations for conversion is three years. [33] Ockey's complaint was not filed until June 19, 1997, several months after the statute of limitations had run. But Ockey argues that his late filing was excused because the equitable discovery rule tolled the statute of limitations. ¶ 36 The equitable discovery rule operates to toll a statute of limitations until the time at which a party discovered or reasonably should have discovered `facts forming the basis for the cause of action.' [34] There are two versions of the rule: (1) the concealment version, requiring the plaintiff to show that he did not know about the events giving rise to his claim due to the defendant's concealment or misleading conduct, and (2) the exceptional circumstances version, requiring the plaintiff to show the existence of exceptional circumstances such that application of the general statute of limitations would be irrational or unjust. [35] ¶ 37 Because Ockey has not asserted the existence of any exceptional circumstances, we evaluate Ockey's claim only under the concealment version of the equitable discovery rule. To prevail, Ockey must show that he did not know, and could not have reasonably known, about the events giving rise to his injury before the statute of limitations ran. [36] Ockey did not raise the alternative argument that he acted reasonably in failing to file suit before the limitations period expired. [37] Therefore, we do not address this argument. ¶ 38 Ample evidence supports the district court's conclusion that Ockey either knew, or had reason to know, of the 1993 stock transfers within three years of their occurrence. For example, the district court found that as early as 1993 or 1994, Ockey knew that IMAI stock had been issued to other family members because he had ready access to all relevant records concerning the ranch and because Ockey asked Uncle Nick if he could buy some of Uncle Nick's IMAI stock. Moreover, Ockey knew that family members were being compensated with IMAI stock for their work on behalf of IMAI. And he was knowledgeable regarding IMAI business affairs, such as the fact that his mother was president of IMAI and his cousin was a member of the IMAI board. Ockey had also seen an IMAI stock ledger, shown to him by his mother, that reflected who had shares in the corporation. Based on these facts, the district court found, as a matter of fact, that Ockey either knew or had reason to know of the events giving rise to a conversion claim within three years after any conversion of IMAI stock. Although the district court did not clearly state when in 1993 or 1994 these events occurred, viewing the evidence in the light most favorable to the trial court's findings, we must assume that the events occurred prior to June 19, 1994. ¶ 39 The evidence listed by the district court is sufficient to show that Ockey knew, or had reason to know, of the events giving rise to his conversion claim before the three-year statute of limitations expired in 1996. Thus, the equitable discovery rule is not applicable, and the district court correctly dismissed Ockey's conversion claim as barred by the statute of limitations.