Prieto v. John Hancock Mtl ( 2002 )

UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT
No. 01-10161
ANGELO PRIETO,
Trustee of the Brett M Davis
Insurance Trust;
BRETT M DAVIS, Individually
Plaintiffs - Appellants,
versus
JOHN HANCOCK MUTUAL LIFE
INSURANCE COMPANY;
JIM ENGRAM, Individually;
JIM ENGRAM & ASSOCIATES
Defendants - Appellees,
Appeal from the United States District Court
For the Northern District of Texas
(No. 3:97-CV-2441-L)
April 17, 2002
Before JOLLY, HIGGINBOTHAM, and PARKER, Circuit Judges.
PER CURIAM:*
Plaintiffs appeal the district court’s granting summary
judgment on their various state-law claims and on their federal
racketeering amd securities law claims. Under any of these
*
Pursuant to 5TH CIR. R. 47.5, the Court has determined that this
opinion should not be published and is not precedent except under
the limited circumstances set forth in 5TH CIR. R. 47.5.4.
claims, the limitations period is not longer than four years.
Plaintiffs sue for misrepresentations allegedly made in the
course of their purchasing an insurance policy in 1983. They
claim, however, that Defendants obscured the facts on which they
now sue until after the limitations periods ran. The district
court, in a comprehensive and well-considered opinion, concluded
that Plaintiffs had actual knowledge of Defendants’
misrepresentations by 1987 and that Plaintiffs’ claims were time-
barred by 1991. We affirm.
Both the discovery rule and the doctrine of fraudulent
concealment toll applicable statutes of limitations until the
claimant discovers or with reasonable diligence should have
discovered facts that could support a cause of action. See
Colonial Penn Ins. v. Market Planners Ins. Agency, 157 F.3d 1032,
1034-35 (5th Cir. 1998)(discussing both rules). A plaintiff need
not discover each element of her cause of action before the
limitations period begins to run. Instead, it protects her only
until she ought to know facts that would lead a reasonable person
to investigate the possible existence of a cause of action. In
this case, it is not disputed that Plaintiffs by 1987 knew that
Defendant Engram’s previous representations that the policy
dividends were guaranteed and that the interest rate on policy
loans was fixed were false. At that point, the statute of
limitations began to run, for Plaintiffs knew they had causes of
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action for breach of contract, fraud, and negligent
misrepresentation, among others. Engram’s continuing insistence
that the policy would perform as illustrated in the face of these
discoveries cannot again toll the limitations period until the
next instance of wrongdoing was discovered. Knowing that Engram
had misled them in the past, reasonable claimants in Plaintiffs’
position would sue to have the policy amended in accordance with
Engram’s promises. At a minimum, they should have carefully
investigated any further promises he made.
AFFIRMED.
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