JAMES A. ELLIS & ASSOCIATES, ARCHITECTS, PSC v. THOMAS W. HUFFMAN
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RENDERED: November 24, 1999; 2:00 p.m.
NOT TO BE PUBLISHED
C ommonwealth O f K entucky
C ourt O f A ppeals
NO.
1998-CA-000718-MR
JAMES A. ELLIS & ASSOCIATES,
ARCHITECTS, PSC
v.
APPELLANT
APPEAL FROM PIKE CIRCUIT COURT
HONORABLE CHARLES E. LOWE, JR., JUDGE
ACTION NO. 95-CI-01674
THOMAS W. HUFFMAN
(D/B/A THE LANDMARK INN)
APPELLEE
OPINION
AFFIRMING
** ** ** ** **
BEFORE:
COMBS, EMBERTON, AND MCANULTY, JUDGES.
EMBERTON, JUDGE.
James A. Ellis & Associates, Architects, PSC
appeals from an order of the Pike Circuit Court granting summary
judgment to Thomas W. Huffman on a civil complaint based on the
statute of limitations.
Finding no error, we affirm.
James A. Ellis, the principal partner of Ellis &
Associates, met with Richard Getty in August 1994, concerning
Getty’s possible legal representation of the architectural firm
in collecting payment that was allegedly overdue for services
rendered on several building contracts.
Ellis asserted that the
firm was owed approximately $8,000,000 for architectural services
the firm had provided involving construction on several school
buildings in Pike, Floyd, and Martin Counties.
Ellis also
discussed with Getty a claim against Huffman for services the
firm had rendered on projects involving The Landmark Inn, a hotel
owned and operated by Huffman, in Pikeville, Kentucky.
After several months of evaluation, Getty filed a
complaint on behalf of Ellis & Associates against Huffman on
November 20, 1995, seeking $40,785 for reimbursable expenses and
$27,000 in interest related to architectural services performed
by Ellis & Associates.
The complaint alleged that Ellis &
Associates rendered valuable services “from the fall of 1985
through the fall of 1987 pertaining to blasting damage done to
The Landmark Inn” and “from the winter or spring of 1988 through
the fall of 1989 pertaining to the construction of convention
facilities and additional rooms to The Landmark Inn.”
The
complaint sought relief based on breach of contract and quantum
meruit or unjust enrichment.
On December 20, 1995, Huffman filed an answer to the
complaint admitting that Ellis & Associates performed
architectural services related to blasting damage to The Landmark
Inn, denying that Ellis had performed any architectural services
involving the addition of rooms to the hotel, and pleading
several affirmative defenses including statute of limitations.1
Huffman also alleged that Ellis had received food, alcohol and
1
See generally Kentucky Rules of Civil Procedure (CR)
8.03.
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the use of hotel rooms for political gatherings as payment on any
amount owed to Ellis & Associates.
In March 1996, Huffman responded to eleven requests for
admissions proposed by Ellis & Associates.
Between April 1996
and March 1997, the parties took the depositions of Huffman on
three occasions, Ellis on two occasions, Michael DeBourbon,
Huffman’s former attorney, and William Freebody, a musician who
performed occasionally at The Landmark Inn.
In June 1996, Huffman filed a motion for summary
judgment based on the five-year statute of limitations applicable
to verbal contracts.
The trial court assigned a hearing date of
August 16, 1996, on the motion, but Huffman’s counsel could not
attend, so it was rescheduled for August 23, 1996.
However,
counsel for Ellis & Associates was not notified of the new
hearing date and did not appear.
On September 5, 1996, the trial
court entered an order and opinion granting the motion for
summary judgment.
On September 11, 1996, Ellis & Associates filed a
motion to vacate the judgment or for leave to amend the
complaint.
On October 1, 1996, Huffman filed a response to the
motion to vacate.
Ellis & Associates’ attorney filed a reply.
On October 24, 1996, the trial court granted the motion to vacate
and allowed appellant to amend the complaint.
In the amended
complaint, Ellis & Associates alleged that the parties had
entered into an agreement for Huffman to pay $21,140 on the debt
for services related to the blasting damage and $15,395 for past
services and in addition to make payments for any further
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services provided by the firm relating to construction of the
convention center addition to the hotel.
Appellant alleged that
the agreement provided for payments of $2,000 per month on the
$21,140 debt.
The amended complaint included as an exhibit a
handwritten document dated October 7, 1989, allegedly
memorializing that agreement.
Shortly thereafter, Huffman filed a renewed motion for
summary judgment based on the statute of limitations.
That
motion restated the arguments presented in the original motion.
In November 1996, Ellis & Associates filed a memorandum in
opposition to the motion admitting that the architectural
services originally had been performed pursuant to verbal
agreements, but arguing that the October 7, 1989, document
created a written contract subject to the fifteen-year statute of
limitations.2
Appellant also contended that James Ellis was
available for consultation on the convention center project until
its completion on December 13, 1990, so any debt on that claim
satisfied even a five-year limitations period.
Finally, counsel
maintained that Getty had delayed filing the complaint based on
discussions with Huffman’s attorney, and that Huffman should be
estopped from asserting a statute of limitations defense.
On
December 12, 1996, Huffman filed a reply to the response.
On January 24, 1997, the trial court conducted a
hearing on the renewed motion for summary judgment at which both
parties were represented by counsel.
On January 30, 1997, Ellis
& Associates filed a post-hearing memorandum and a motion seeking
2
See Kentucky Revised Statutes (KRS) 413.090.
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permission to file a second amended complaint.
In the
memorandum, appellant attempted to clarify the factual background
of its claims.
On January 30, 1997, Huffman filed a response to
the post-hearing memorandum arguing that appellant was attempting
to change his deposition testimony.
Ellis & Associates filed a
reply to the response.
On February 18, 1998, the trial court issued an order
with findings of fact granting summary judgment to Huffman and
holding that Ellis & Associates’ claim was barred by the fiveyear statute of limitations applicable to contracts not in
writing.3
This appeal followed.
The standard of review on appeal where a trial court
grants a motion for summary judgment is “whether the trial court
correctly found that there were no genuine issues as to any
material fact and that the moving party was entitled to judgment
as a matter of law.”4
The trial court must view the evidence in
the light most favorable to the nonmoving party, and summary
judgment should be granted only if it appears impossible for the
nonmoving party to produce evidence at trial warranting a
judgment in his favor.5
The moving party bears the initial
burden of showing no genuine issue of material fact exists, and
then the burden shifts to the party opposing summary judgment to
present “at least some affirmative evidence showing that there is
3
KRS 413.120(1).
4
Scifres v. Kraft, Ky. App., 916 S.W.2d 779, 781 (1996);
CR 56.03.
5
Steelvest, Inc. v. Scansteel Service Center, Inc., Ky.,
807 S.W.2d 476, 480-82 (1991).
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a genuine issue of material fact for trial.”6
Whether an action
is barred by the statute of limitations generally is a question
of law decided by the courts.7
Here, James Ellis stated in his depositions that the
services he rendered with respect to the blasting damage issue
were completed on October 26, 1987, and with respect to the
convention center addition on April 7, 1989.
Huffman made
several payments to Ellis, the last of which occurred in April
1989.
Ellis stated in one of his depositions that sometime
before November 19, 1990, Huffman stopped allowing him to charge
food and beverages at The Landmark Inn, which was a part of the
payment agreement.
Having reviewed the October 7, 1989, document, we agree
with the trial court that the brief handwritten note does not
contain sufficient terms to constitute a written contract for
purposes of applying the fifteen-year statute of limitations.8
Consequently, the five-year statute of limitations for oral
contracts applied to the services provided to Huffman by Ellis &
Associates.
6
Steelvest, 807 S.W.2d at 482.
7
Cuppy v. General Accident Fire & Life Assurance Corp.,
Ky., 378 S.W.2d 629, 631 (1964). See generally Old Mason’s Home
of Kentucky, Inc. v. Mitchell, Ky. App., 892 S.W.2d 304 (1995).
8
See, e.g., Mills v. McGaffee, 254 S.W.2d 716
(1953)(written instrument must include all its terms, the
consideration for the undertaking, and the identities of the
parties in order to constitute a contract in writing); Gray v.
Int’l Ass’n of Heat and Frost Insulators and Asbestos Workers
Local No. 51, 447 F.2d 1118 (6th Cir. 1971)(contracts partly oral
and partly written or so indefinite as to require parole evidence
are not “contracts in writing” within the fifteen-year statute of
limitations).
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Based on the entire record, we also agree with the
circuit court that any cause of action on the contracts between
the parties accrued prior to November 1990.
Ellis & Associates’
argument that its cause of action did not accrue until December
13, 1990, because the convention center addition project was not
completed until it received final approval by the state building
agency is unconvincing.
after October 1989.
Ellis performed no billable services
Several months prior to November 1990, Ellis
was notified that Huffman would provide no further compensation.
Finally, Ellis & Associates’ argument that Huffman is
estopped from asserting a statute of limitations defense or that
the limitations period was tolled because of settlement
negotiations is without merit.
Richard Getty, appellant’s former
attorney, stated in an affidavit that he delayed filing a legal
complaint at the request of Huffman’s attorney in an attempt to
settle the dispute.
Ellis & Associates has presented no facts
indicating that it was prevented from filing suit or that Huffman
or his attorney obstructed appellant’s ability to prosecute an
action.9
Settlement negotiations between parties cannot be used
to extend or toll the statute of limitations.
In Burke v.
Blair,10 the court held that the defendant was not estopped from
9
See, e.g., KRS 413.190. See also Roman Catholic Diocese
of Covington v. Secter, Ky., App., 966 S.W.2d 286, 290
(1998)(“Obstruction might also occur where a defendant conceals a
plaintiff’s cause of action so that it could not be discovered by
the exercise of ordinary diligence on the plaintiff’s part.”)
10
Ky., 349 S.W.2d 836 (1961).
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asserting a limitations bar because of actions by its attorney
involving a possible settlement.
It stated:
The general rule is that a party may be
estopped to plead limitations where he has
induced inaction on the part of plaintiff by
his false representations or fraudulent
concealment. However, the fraudulent action
must be of a character to prevent inquiry or
elude an investigation or otherwise mislead
the party having cause of action, and such
party is under the duty to exercise
reasonable care and diligence. . . .
It is not denied that the appellee knew
when he discussed settlement with appellant’s
attorney that the attorney was working for
his adversary. Mere negotiations looking
toward an amicable settlement do not afford a
basis for estoppel to plead limitations.
(Citations omitted).11
In order to prevail on a theory of equitable estoppel, a party
must prove the existence of both an intent of the estopped party
to induce inaction and reasonable reliance by the party claiming
the estoppel.12
Ellis & Associates has presented no evidence
that Huffman’s attorney intended to mislead, obstruct, or conceal
material information preventing appellant from filing its
complaint or that appellant reasonably relied on any misconduct
of appellee’s attorney.
The trial court correctly held that Ellis & Associates’
action was barred by the five-year statute of limitations.
The order of the Pike Circuit Court is affirmed.
ALL CONCUR.
11
Id. at 838.
12
Garbor, 990 S.W.2d at 604.
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BRIEF FOR APPELLANT:
BRIEF FOR APPELLEE:
James A. Ellis, Pro se
Pikeville, Kentucky
Neal Smith
Pikeville, Kentucky
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