(palmer) v. Bowen

264 P.3d 233

693 Utah Adv. Rep. 41

2011 UT App 352

Analisa BOWEN (Palmer), Plaintiff and Appellee,

v.Tonna Lee BOWEN, Defendant and Appellant.

No. 20100913–CA.

Court of Appeals of Utah.

Oct. 14, 2011.

Tonna Lee Bowen, San Clemente, California, Appellant Pro Se.Nolan J. Olsen and Matthew N. Olsen, Midvale, for Appellee.Before Judges DAVIS, VOROS, and CHRISTIANSEN.

MEMORANDUM DECISION

DAVIS, Presiding Judge:

¶ 1 Tonna Lee Bowen appeals the trial court's denial of her motion for summary judgment and grant of Analisa Palmer's (formerly known as Analisa Bowen) motion for summary judgment. We affirm.

¶ 2 In its ruling, the trial court determined that the statute of limitations did not bar Analisa's claim in light of the equitable discovery rule; that Bruce J. Bowen's 2001 amendment to the Bruce J. Bowen Irrevocable Trust (the Trust) removing Analisa and her brother, Cordell Bowen, as Trust beneficiaries and making Tonna the sole beneficiary and successor trustee was invalid and unenforceable; and that modification of the Trust as a matter of law was not warranted. The court also ordered that Analisa be appointed successor trustee of the Trust and that a judgment be entered against Tonna for $186,655.49, two-thirds of the money Tonna took from the Trust between 2002 and 2006, which should have been distributed equally to Analisa and Cordell.

¶ 3 In challenging the trial court's application of the discovery rule to toll the statute of limitations, Tonna argues that the notice accompanying the May 15, 1996 Order for Appointment of Successor Trustee and Alternate Successor Trustee (the 1996 Order), which appointed Bruce as trustee of the Trust and amended the list of alternate successor trustees, put Analisa on constructive notice that the Trust existed. Tonna argues that because Analisa had constructive notice that the Trust existed, she also had constructive notice of the provisions of the Trust.

¶ 4 The applicability of a statute of limitations and the discovery rule are questions of law, which we review for correctness. See Colosimo v. Roman Catholic Bishop of Salt Lake City, 2004 UT App 436, ¶ 8, 104 P.3d 646, aff'd, 2007 UT 25, 156 P.3d 806. “[T]he applicability of the statute of limitations and the discovery rule also involves a subsidiary factual determination—the point at which a person reasonably should know that he or she has suffered a legal injury.” Spears v. Warr, 2002 UT 24, ¶ 32, 44 P.3d 742, overruled on other grounds by Tangren Family Trust v. Tangren, 2008 UT 20, ¶ 16, 182 P.3d 326. We review this subsidiary factual determination under a clearly erroneous standard. See id.

¶ 5 A four-year statute of limitations applies to this trust action.¹ See Snow v. Rudd, 2000 UT 20, ¶¶ 9, 16, 998 P.2d 262 (applying the four-year catch-all statute of limitations contained in Utah Code section 78B–2–307(3) to a trust dispute). The discovery rule operates to toll a statute of limitations “until the discovery of facts forming the basis for the cause of action.” Myers v. McDonald, 635 P.2d 84, 86 (Utah 1981). “We apply the discovery rule only when required by statute, when a defendant has affirmatively concealed a plaintiff's cause of action, or when exceptional circumstances exist.” Snow, 2000 UT 20, ¶ 10, 998 P.2d 262.

¶ 6 Although the parties concentrate on the concealment branch of the discovery rule, we focus our analysis on the exceptional circumstances branch because that is the branch relied upon by the trial court. This branch of the discovery rule first requires claimants to demonstrate that they “did not know and could not reasonably have discovered the facts underlying the cause of action in time to commence an action within that period.” Walker Drug Co. v. La Sal Oil Co., 902 P.2d 1229, 1231 (Utah 1995). Next, the court must “apply a balancing test to weigh the hardship imposed on the claimant by the application of the statute of limitations against any prejudice to the defendant resulting from the passage of time.” Snow, 2000 UT 20, ¶ 11, 998 P.2d 262 (internal quotation marks omitted); see also Praznik v. Sport Aero, Inc., 42 Ill.App.3d 330, 355 N.E.2d 686, 691 (1976) (framing the discovery rule as requiring the court to “look at the difficulty of proof created by the passing of time as balanced against the hardship to the plaintiff who neither knows nor should have known of the existence of a right to sue”).

¶ 7 Here, Tonna argues that the record unequivocally demonstrates that Analisa had at least constructive notice through publication that the Trust existed in May 1996. As proof of Analisa's constructive notice, Tonna relies on the 1996 Order which states, “The required notices have been given.” The 1996 Order, however, also lists Analisa's address as “unknown,” and Analisa's affidavit states that she did not have any knowledge of the Trust until May 26, 2006. In response, Tonna directs us to the Proof of Publication, which explains that the notice was published in three issues of two different newspapers during April 1996. Analisa, however, argues that the Proof of Publication evidence was not in the record before the trial court and that we therefore cannot consider it on appeal. See Wilderness Bldg. Sys., Inc. v. Chapman, 699 P.2d 766, 768 (Utah 1985) (explaining that an appellate court's “review is of course limited to the evidence contained in the record on appeal”). We agree with Analisa. Although Tonna included the Proof of Publication evidence in the addendum to her Motion for Reconsideration of Summary Judgment for Plaintiff (Motion to Reconsider) and with her docketing statement for appeal, the record indicates that the trial court did not rule on this motion or otherwise consider it. Because the Utah Rules of Civil Procedure do not recognize postjudgment motions to reconsider, see Gillett v. Price, 2006 UT 24, ¶ 7, 135 P.3d 861, “trial courts are under no obligation to consider [them, and] any decision to address or not to address the merits of such a motion is highly discretionary,” ²Tschaggeny v. Milbank Ins. Co., 2007 UT 37, ¶ 15, 163 P.3d 615. See generally Gillett, 2006 UT 24, ¶ 8, 135 P.3d 861 (“Hereafter, when a party seeks relief from a judgment, it must turn to the rules to determine whether relief exists, and if so, direct the court to the specific relief available. Parties can no longer leave this task to the court by filing so-called motions to reconsider and relying upon district courts to construe the motions within the rules.”); Radakovich v. Cornaby, 2006 UT App 454, ¶¶ 5–7, 147 P.3d 1195 (explaining that Gillett “put an end to [the] practice” by “the appellate courts of this state ... [of] treating motions to reconsider as if they were filed under a valid procedural rule based upon the substance of the motion”). The trial court did not abuse its discretion when it declined to address Tonna's Motion to Reconsider, and because the trial court did not review the motion, the publication evidence appended to it was not a part of the record when the trial court issued its decision on summary judgment. Consequently, the publication evidence is not properly before us on appeal.

¶ 8 The statute of limitations evidence properly before the trial court consisted of Analisa's affidavit and the 1996 Order indicating that notice was given and listing Analisa's address as unknown. The trial court stated,

I'm ... not convinced that the notice given in [19]96 was appropriate constructive notice. The documents indicate[ ] there was notice. It shows that the address of the plaintiff was unknown and there is no showing in my record that there was, for instance, notice through publication which would be constructive notice, but there is no evidence before me of that.[ ³]

Accordingly, we do not believe the trial court's determination that Analisa lacked constructive or actual notice until May 26, 2006, was incorrect or clearly erroneous.⁴

¶ 9 Next, we consider whether the trial court correctly determined that Analisa's situation was an “exceptional circumstance,” warranting application of the discovery rule to toll Analisa's claim. Without application of the discovery rule, it is likely Analisa's claim would be barred by the four-year statute of limitations because she did not file her complaint until May 25, 2007. Analisa's claim accrued in either 2001, when the amendment to the Trust was executed, or sometime after Bruce died on May 18, 2002, and Tonna acted upon the terms of the amendment.⁵

¶ 10 A determination that a particular situation constitutes an “exceptional circumstance” involves weighing the equities for and against tolling the statute of limitations. See Snow v. Rudd, 2000 UT 20, ¶ 11, 998 P.2d 262. Although the trial court's analysis of this prong of the discovery rule test is rather sparse,⁶ we nonetheless believe its finding in favor of Analisa is correct because

when a case involves a trust, a trustee cannot take advantage of a statute of limitations defense until something has occurred to give the beneficiary a clear indication that a breach or repudiation has occurred, or, alternatively, the circumstances must be such that [the beneficiary] must be charged with knowledge of such a repudiation or breach.Id. (alteration in original) (internal quotation marks omitted); accord Walker v. Walker, 17 Utah 2d 53, 404 P.2d 253, 257 (1965) (“[A statute of limitations] defense is not available to a trustee as against his beneficiaries until something has occurred to give a clear indication to them that he has repudiated his trust[ ] or the circumstances are such that they must be charged with knowledge of such repudiation.” (footnote omitted)). “[W]here a trustee is sued by a beneficiary or [a beneficiary] claims a violation of the trust, it constitutes an ‘exceptional circumstance’ calling for application of the discovery rule.” Snow, 2000 UT 20, ¶ 11, 998 P.2d 262.

¶ 11 Here, the statute of limitations would operate to bar Analisa's claim when she had no reason...