Thomas v. Richards

ROBERT P. THOMAS, Plaintiff-Appellant, v. ANTHONY F. RICHARDS and ALTHEA D. RICHARDS, Defendants-Appellees.

No. 354255

Court of Appeals of Michigan

July 29, 2021

UNPUBLISHED

St Clair Circuit Court LC No. 19-002813-CZ

Before: Gadola, P.J., and Jansen and O'Brien, JJ.

Per Curiam.

Plaintiff Robert P. Thomas, appeals as of right the trial court's order granting defendants, Anthony F. Richards and Althea D Richards, summary disposition under MCR 2.116(C)(7). We affirm.

I. FACTS

This case arises from a land contract between the parties. In 1995, defendants owned certain commercial property in Port Huron, Michigan, that previously had been used as a gas station and restaurant. Defendants learned that two underground storage tanks on the property were leaking hazardous substances into the surrounding soil. As a result of the leakage, the property was designated as a "facility"^[1] under Michigan's Natural Resources and Environmental Protection Act (NREPA), MCL 324.101 et seq. Defendants contracted with Universal Environmental Science & Engineering, Inc. (UESE), to remove the leaking storage tanks and the contaminated surrounding soil. After completing the cleanup, UESE informed defendants by letter that "the site should not be considered to constitute an environmental hazard to the subject or adjoining properties. Also, the property should not be considered as contaminated as long as the intended use of the property does not change from a Commercial Subcategory III or IV." Defendants did not take any further action to change the classification of the property as a "facility" under the NREPA.

On May 13, 1996, the parties entered into a land contract by which plaintiff agreed to purchase the property from defendants. According to plaintiff's complaint, during the execution of the land contract defendants advised him of the hazardous substance leak and the cleanup that had occurred. Plaintiff also alleged that at that time defendant Anthony Richards (defendant) represented to him that the property was no longer considered a "facility" under the NREPA, that the assessment reports prepared by UESE in 1995 identified both defendant and plaintiff as the owners of the property, and that as a new owner, plaintiff was not liable for contamination that existed before the date of purchase. Plaintiff alleged that defendant affixed plaintiff's name on the covers of the UESE reports in connection with these assertions.

After entering into the land contract, plaintiff operated his chiropractic business on the property for many years. The land contract required plaintiff to pay monthly payments to defendants and to pay the contract in full by May 2000, but over the years the parties agreed to several extensions. In 2019, plaintiff defaulted on the land contract and defendants sought payment of the balance owed under the land contract. While attempting to sell the property, plaintiff learned that the property was still designated as a "facility" under the NREPA by the Michigan Department of Environmental Quality (MDEQ). Plaintiff asserts that the designation of the property as a facility precluded him from selling the property and from obtaining conventional financing, and necessitated further environmental cleanup of the property.

Plaintiff filed his complaint initiating this action on December 6, 2019, alleging that defendant engaged in fraud and misrepresentation, innocent misrepresentation, fraud in the inducement, and silent fraud. Plaintiff alleged that at the time of the execution of the land contract, defendants represented to him that the documentation necessary to change the designation of the property from a facility had been submitted to the MDEQ, assured him that he would have no future environmental cleanup obligations, assured him that the property was free of environmental issues and was marketable, and failed to disclose the true status of the property. Plaintiff alleged that he entered into the land contract relying upon defendants' fraudulent statements.

Defendants moved for summary disposition under MCR 2.116(C)(7) and (8), contending that plaintiff's claim was barred by the six-year statute of limitations under MCL 600.5813. Plaintiff responded that defendants fraudulently concealed the existence of his claim, and that he therefore was entitled to bring the action within two years of discovering the claim under MCL 600.5855. The trial court found that defendants were entitled to summary disposition under MCR 2.116(C)(7) because plaintiff's complaint did not allege fraudulent concealment nor facts supporting that assertion, and that plaintiff's claim therefore was barred by the statute of limitations.

Plaintiff moved for reconsideration and requested leave to amend his complaint to allege fraudulent concealment. The trial court denied plaintiff's motion for reconsideration and also denied plaintiff's request to amend the complaint. The trial court found that amendment of the complaint would be futile because there was no dispute that defendants did not act to conceal plaintiff's claim after the execution of the land contract. Plaintiff now appeals.

II. DISCUSSION

Plaintiff contends that the trial court erred by granting defendants summary disposition under MCR 2.116(C)(7). Plaintiff argues the trial court misapplied the fraudulent concealment exception to the statute of limitations in reaching the conclusion that plaintiff's claim was barred under MCL 600.5813. We disagree.

A. STANDARD OF REVIEW

We review de novo the trial court's decision to grant or deny summary disposition. El-Khalil v Oakwood Healthcare, Inc, 504 Mich.App. 152, 159; 934 N.W.2d 665 (2019). We also review de novo issues involving the proper interpretation of statutes. Titan Ins Co v Hyten, 491 Mich. 547, 553; 817 N.W.2d 562 (2012). When reviewing a trial court's decision on a motion for summary disposition under MCR 2.116(C)(7), we consider all documentary evidence in the light most favorable to the non-moving party, RDM Holdings, Ltd v Continental Plastics, Co, 281 Mich.App. 678, 687; 762 N.W.2d 529 (2008), accepting the complaint as factually accurate unless specifically contradicted by affidavit or other documentation. Frank v Linkner, 500 Mich. 133, 140; 894 N.W.2d 574 (2017). Summary disposition is properly granted under MCR 2.116(C)(7) when a claim is barred by the statute of limitations. Id. If the facts are not disputed, whether a claim is barred by the statute of limitations is a question of law for the court. RDM Holdings, 281 Mich.App. at 687.

B. STATUTE OF LIMITATIONS

A statute of limitations is defined as a" 'law that bars claims after a specified period; specif[ically], a statute establishing a time limit for suing in a civil case, based on the date when the claim accrued.'" Frank, 500 Mich. at 142, quoting Black's Law Dictionary (10^th ed) (alteration in original). The purpose of a statute of limitations is to prevent a defendant from being forced to defend against a stale claim. Stephens v Dixon, 449 Mich. 531, 534; 536 N.W.2d 755 (1995). The party asserting the statute of limitations has the burden of proving that defense. Prins v Michigan State Police, 291 Mich.App. 586, 589; 805 N.W.2d 619 (2011).

The applicable limitations period is determined by the "gravamen of an action" based on the complaint as a whole. Adams v Adams, 276 Mich.App. 704, 710; 742 N.W.2d 399 (2007). Here, the parties do not dispute that the relevant period of limitations for plaintiff's fraud claims is six years under MCL 600.5813. See Citizens Ins Co of America v Univ Physician Group, 319 Mich.App. 642, 651; 902 N.W.2d 896 (2017). MCL 600.5813 provides:

All other personal actions shall be commenced within the period of 6 years after the claims accrue and not afterwards unless a different period is stated in the statutes.

The parties also do not dispute that plaintiff's claims of fraud accrued "at the time the wrong upon which the claim is based was done regardless of the time when damage results." MCL 600.5827; see also Boyle v Gen Motors Corp, 468 Mich. 226, 232; 661 N.W.2d 557 (2003). Because plaintiff asserts that the fraud occurred at the time of the execution of the land contract on May 13, 1996, and he filed his complaint on December 5, 2019, more than six years elapsed after the accrual of his claim, and the statute of limitations therefore bars his claim.

Plaintiff contends, however, that the statute of limitations was tolled in this case because defendants fraudulently concealed his claim. MCL 600.5855 provides for the tolling of a statutory limitations period when a defendant fraudulently conceals the existence of the plaintiff's claim. Mays v Snyder, 323 Mich.App. 1, 39; 916 N.W.2d 227 (2018), aff'd 506 Mich. 157 (2020). MCL 600.5855 provides:

If a person who is or may be liable for any claim fraudulently conceals the existence of the claim or the identity of any person who is liable for the claim from the knowledge of the person entitled to sue on the claim, the action may be commenced at any time within 2 years after the person who is entitled to bring the action discovers, or should have discovered, the existence of the claim or the identity of the person who is liable for the claim, although the action would otherwise be barred by the period of limitations.

Thus, under MCL 600.5855 a plaintiff has two years within which to bring a claim from the time he or she discovers or reasonably should have discovered the claim or the person liable for the claim if the plaintiff proves that the defendant fraudulently concealed the existence of the claim or of the person liable for the claim. Frank, 500 Mich. at 148.

Fraudulent concealment is "employment of artifice, planned to prevent inquiry or escape investigation, and mislead or...