Beecher v. Stratton Corporation

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Beecher v. Stratton Corporation (98-382); 170 Vt. 137; 743 A.2d 1093

[Filed 19-Nov-1999]

NOTICE: This opinion is subject to motions for reargument under
V.R.A.P. 40 as well as formal revision before publication in the Vermont
Reports. Readers are requested to notify the Reporter of Decisions,
Vermont Supreme Court, 109 State Street, Montpelier, Vermont 05609-0801 of
any errors in order that corrections may be made before this opinion goes
to press.

No. 98-382

Wade Beecher Supreme Court

On Appeal from
v. Windham Superior Court

Stratton Corporation May Term, 1999
d/b/a Stratton Mountain Ski Resort

John P. Meaker, J.

Theodore A. Parisi, Jr., Castleton, and Martha M. Smyrski of Paterson
& Walke, P.C., Montpelier, for Plaintiff-Appellant.

John A. Serafino of Ryan Smith & Carbine, Ltd., Rutland, for
Defendant-Appellee.

PRESENT: Amestoy, C.J., Dooley, Morse, Johnson and Skoglund, JJ.

AMESTOY, C.J. Plaintiff, who sued defendant Stratton Mountain
Corporation after being injured while skiing at its resort, appeals the
superior court's summary judgment ruling barring his suit under the
applicable one-year statute of limitations. See 12 V.S.A. § 513 (action
to recover for injuries sustained while participating in sport of skiing
shall be commenced within one year after cause of action accrues). In
granting summary judgment to defendant, the court rejected plaintiff's
contention that statements made by defendant's insurance adjuster precluded
defendant from invoking the statute of limitations. We find no error in
the court's refusal to apply the doctrine of equitable estoppel or
equitable tolling, and thus affirm its judgment.

Plaintiff, a Connecticut resident, was injured while skiing at
Stratton Mountain on January 20, 1996. He retained a Connecticut lawyer,
who began negotiations with defendant's insurance adjuster shortly after
the accident. In October 1996, a Vermont attorney took over plaintiff's
case and resumed settlement negotiations with the adjuster. According to
plaintiff, at some point before the limitations period expired, the
adjuster asked plaintiff's attorney to

refrain from filing suit until the conclusion of settlement negotiations.
Later, in a January 14, 1997 telephone conversation with plaintiff's
attorney, the adjuster insisted on plaintiff submitting to an independent
medical examination before negotiations could be concluded. Plaintiff
agreed. On March 4, 1997, the adjuster informed plaintiff's attorney that
he had found two doctors in Connecticut who could perform an independent
examination. On March 10, 1997, plaintiff's attorney informed the
adjuster that the statute of limitations had run and asked him to agree to
an extension until May 1, 1997. The adjuster refused and closed the case.

On March 11, 1997 plaintiff filed his negligence suit in superior
court. Defendant moved for summary judgment based on plaintiff's failure
to file his suit within the one-year limitations period. The superior
court held an evidentiary hearing on March 4, 1998 to consider plaintiff's
claim that defendant should be estopped from asserting the statute of
limitations. Plaintiff's attorney and the adjuster testified at the
hearing. The court viewed the evidence most favorably to plaintiff and
accepted as true the testimony of plaintiff's attorney that the adjuster
asked him to refrain from filing suit until negotiations were concluded,
and that, when asked if there would be any statute-of-limitations problem,
the adjuster indicated that he was unaware of any such problem.
Nevertheless, the court rejected plaintiff's claims of equitable estoppel
and equitable tolling, concluding that plaintiff's attorney was at least
as aware of the one-year limitations period as the adjuster, and that the
attorney had not acted reasonably in failing to file suit without
obtaining a promise from the adjuster that defendant would waive or extend
the statute of limitations. On appeal, plaintiff argues that the superior
court erred by resolving issues of material fact and by refusing to apply
either the doctrine of equitable estoppel or the doctrine of equitable
tolling.

We address the latter two issues first to facilitate our discussion.
Plaintiff contends that the doctrine of equitable estoppel precludes
defendant from invoking the applicable statute of limitations under the
circumstances of this case. The doctrine of equitable estoppel seeks to

promote fair dealing and good faith by preventing "one party from asserting
rights which may have existed against another party who in good faith has
changed his or her position in reliance upon earlier representations."
Fisher v. Poole, 142 Vt. 162, 168, 453 A.2d 408, 411 (1982). While the
representations relied upon need not be fraudulent in a strict legal sense,
see id., generally a defendant is not estopped from raising a
statute-of-limitations defense absent either a promise or some sort of
misrepresentation or concealment of a fraudulent character. See Caledonia
Sand & Gravel Co. v. Campbell, 128 Vt. 182, 185, 260 A.2d 221, 223 (1969);
see, e.g., Welch v. H.P. Hood and Sons, Inc., 138 Vt. 4, 7, 409 A.2d 603, 604 (1979) (refusing to apply equitable estoppel because there was neither
express nor implied agreement not to assert statute of limitations).

The party invoking the doctrine of equitable estoppel has the burden
of establishing four essential elements:

first, the party to be estopped must know the facts; second, the
party being estopped must intend that his conduct shall be acted
upon or the acts must be such that the party asserting the estoppel
has a right to believe it is so intended; third, the latter must be
ignorant of the true facts; and finally, the party asserting the
estoppel must rely on the conduct of the party to be estopped to his
detriment.

Fisher, 142 Vt. at 168, 453 A.2d at 412. All of the circumstances of the
case must be evaluated in determining whether the doctrine applies, but
generally it "will not be invoked in favor of one whose own omissions or
inadvertences contributed to the problem." Id. at 169, 453 A.2d at 412.

In light of this law, we agree with the trial court's determination
that estoppel is unavailable here. Plaintiff's estoppel argument rests
largely on the allegation that defendant's adjuster asked plaintiff's
attorney to refrain from filing suit until settlement negotiations were
completed. This remark was insufficient to estop defendant from invoking
the statute of limitations. Plaintiff's attorney never asked the
adjuster, either orally or in writing, to waive or extend the statute of
limitations. The parties continued negotiations, apparently without

regard to the limitations period, until plaintiff's attorney informed the
adjuster that the period had expired and that he would like it extended.
The evidence was disputed as to whether the statute of limitations was
ever even mentioned between the adjuster and plaintiff's attorney before it
expired, but the most that can be said from plaintiff's perspective is that
the adjuster indicated only that he was unaware of any
statute-of-limitations problem. Certainly, there was no express or
implied agreement to waive the limitations period. Given the adversarial
nature of the relationship between plaintiff's attorney and the adjuster,
the superior court properly concluded that the attorney acted unreasonably
in allowing the limitations period to expire without confirming that
defendant was willing to waive or extend the period while the parties
continued settlement negotiations.

The evidence in this case does not suggest that the adjuster had
superior knowledge of the applicable limitations period and took advantage
of the ignorance of plaintiff's attorney to lull him into inaction. To
the contrary, the actions and testimony of the adjuster indicate that he
was not aware of the limitations period. But even assuming that the
adjuster knew of the one-year statute of limitations, so did plaintiff's
attorney according to his own testimony. Further, even if plaintiff's
attorney was not actually aware of the limitations period, he must be
charged with that knowledge. See Kunstman v. Mirizzi, 44 Cal. Rptr. 707,
710 (Ct. App. 1965). It was the responsibility of plaintiff's attorney,
not defendant's adjuster, to be aware of the applicable limitations period
and to ensure that his client's claims did not expire.

Rather than focus on these unfavorable facts, plaintiff argues that
the four essential elements of estoppel enunciated in Fisher do not apply
here because Fisher concerned a boundary dispute rather than a limitations
period. We find no merit to this argument. The elements of equitable
estoppel noted in Fisher were not intended to apply only in the context of
that case; indeed, we have examined those elements in a variety of
contexts since Fisher was issued. See, e.g., Agency of Natural Resources
v. Godnick, 162 Vt. 588, 592-93, 652 A.2d 988, 991 (1994) (government not
estopped from issuing administrative order penalizing

defendant for noncompliance with Act 250); Ragosta v. Wilder, 156 Vt. 390,
395, 592 A.2d 367, 370 (1991) (defendant not estopped from withdrawing
offer to sell real property); Greenmoss Builders, Inc. v. King, 155 Vt. 1,
7, 580 A.2d 971, 975 (1990) (lawyers who hired client to build addition on
their home estopped from recovering overpayments to builder). Further,
Fisher cites and is consistent with McLaughlin v. Blake, 120 Vt. 174, 136 A.2d 492 (1957), the case upon which plaintiff heavily relies. See 142
Vt. at 168, 453 A.2d at 411. McLaughlin, in turn, relies heavily upon
Howard v. W. Jersey & S.S. R.R., 141 A. 755, 757 (N.J. Ch. 1928), which,
based on its consideration of the same factors later set forth in Fisher,
determined that the conduct of a claims investigator precluded the
defendant in that case from invoking the limitations period. See
McLaughlin, 120 Vt. at 179, 136 A.2d at 495-96.

McLaughlin involved a tort suit stemming from an automobile accident
that occurred in Quebec, Canada. Following the accident, the plaintiff's
attorney entered into settlement negotiations with the insurance adjuster,
who stated that (1) there was no question about the liability of the
defendant; (2) the real question was how much money should be paid to
compensate the plaintiff for injuries caused by the defendant's gross
negligence; (3) the insurance company was going to make a compromise
settlement of the claim, but wanted to wait to determine the severity of
the plaintiff's injuries; and (4) the company wanted the plaintiff to defer
bringing suit until after it could make its settlement offer. See id. at
175, 136 A.2d at 493. The trial court concluded that the adjuster's
statements to the plaintiff's attorney did not estop the defendant from
invoking the one-year statute of extinguishment that was controlling under
Quebec law. This Court disagreed, holding that the trial court erred by
rejecting the plaintiff's estoppel argument and rendering judgment for the
defendant on the pleadings. See id. at 180, 136 A.2d at 496.

The essential distinction between McLaughlin and the instant case is
that the plaintiff's attorney in McLaughlin did not know that the Quebec
statute of extinguishment applied, and thus the defendant was in a
superior position to the plaintiff in that case. This was a critical
factor

in McLaughlin, as evidenced by the Court's reliance on Howard, where "the
plaintiff complied [with the claims investigator's request to delay
bringing suit] unaware that the statute was soon to expire." McLaughlin,
120 Vt. at 179, 136 A.2d at 495. Here, in contrast, plaintiff's attorney
was or should have been aware of the applicable limitations period, and
thus the "circumstances of the case, conscience and honest dealing"
standard adopted in McLaughlin does not apply with equal force. Id. at
179, 136 A.2d at 496.

Further, in McLaughlin the adjuster conceded liability and promised to
compensate the plaintiff through a settlement offer after the plaintiff
reached a medical end-result. Here, even assuming that there had been a
prior settlement offer, there was no admission of liability, and there was
no promise that a settlement offer would be forthcoming once an independent
examination was completed. See Campbell, 128 Vt. at 186, 260 A.2d at 224
("To discuss settlement is one thing and an agreement to settle is quite
another."); cf. Kelley v. Robison, 589 P.2d 472, 473 (Ariz. Ct. App. 1978)
(concluding that conduct of insurance adjuster in paying plaintiff's bills
and promising to pay future medical bills created jury question as to
whether insurance company was estopped from raising statute of limitations
defense); Sander v. Wright, 394 N.W.2d 896, 899 (S.D. 1986) (same). These
differences are fatal to plaintiff's estoppel claim.

Nor can plaintiff find refuge in the doctrine of equitable tolling.
Some jurisdictions have adopted this doctrine, particularly in the context
of administrative proceedings, in considering whether the interests of
justice compel extending the applicable limitations period. See, e.g.,
Ervin v. Los Angeles County, 848 F.2d 1018, 1019 (9th Cir. 1988) (refusing
to toll statute of limitations in federal civil rights action); Machules
v. Department of Admin., 523 So. 2d 1132, 1133-34 (Fla. 1988) (tolling
statute of limitations in administrative appeal from employee
termination). Courts have scrupulously observed limitations on the
doctrine, however, generally applying it only when (1) the defendant
actively misled the plaintiff or prevented the plaintiff in some
extraordinary way from filing a timely lawsuit; or (2) the plaintiff timely
raised the

precise claim in the wrong forum. See School Dist. of City of Allentown v.
Marshall, 657 F.2d 16, 19-20 (3d Cir. 1981); Smith v. American President
Lines, Ltd., 571 F.2d 102, 109 (2d Cir. 1978).

Neither situation is present here. Nor was it reasonable for
plaintiff's attorney to forego filing suit in hope of a settlement that
was never promised by the adjuster. See Ervin, 848 F.2d at 1019 (for
statute of limitations to be equitably tolled, plaintiff must have acted
reasonably). Thus, even if we were to adopt the doctrine of equitable
tolling as distinct from the doctrine of equitable estoppel, it would not
benefit plaintiff here.

II.

Plaintiff also argues that the superior court erred by resolving
issues of material fact in granting defendant's motion for summary
judgment. Specifically, he contends that (1) the affidavits submitted by
the parties in the context of defendant's motion for summary judgment do
not support the court's finding that plaintiff's counsel was at least as
aware of the one-year statute of limitations as the adjuster; and (2) the
court usurped the role of the jury in finding that plaintiff's attorney
acted unreasonably in failing to obtain a promise from the adjuster that he
would waive any statute-of-limitations defense.

We find no merit to these arguments. The parties acquiesced to an
evidentiary hearing that would elicit facts concerning whether defendant
should be estopped from invoking the statute of limitations. At that
hearing, plaintiff's attorney testified that he was aware of the one-year
statute of limitations in January 1997, and defendant's adjuster testified
that in January 1997 he was unfamiliar with the details of any statute of
limitations that would apply to this case. Thus, the evidence supported
the challenged finding in the court's summary judgment order.

In our view, the testimony quoted by Justice Dooley plainly
demonstrates that plaintiff's attorney was conceding on cross-examination
that he had been aware of the limitations period in January 1997, before
it expired. This is reinforced by his testimony on direct examination that
during a January 14, 1997 telephone call with the adjuster, six days before
the limitations

period expired, he asked the adjuster if there was going to be any problems
with the statute of limitations in this case. In any event, even if
plaintiff's attorney was not aware of the one-year statute of limitations,
the insurance adjuster testified that he was unaware of the details of the
statute. See Fisher, 142 Vt. at 168, 453 A.2d at 412 (first element of
equitable estoppel is that "the party to be estopped must know the
facts").

To bolster his argument that the court improperly found facts in
making its summary judgment ruling, plaintiff quotes statements that the
court made during the March 4, 1998 hearing indicating that it would "find
the facts and decide the issue" of whether defendant was estopped from
invoking the statute of limitations. If anything, this argument suggests
that the parties acquiesced to a procedure under which the court would
determine the merits of the estoppel issue as the factfinder. Cf. General
Elec. Credit Corp. v. White, 126 Vt. 149, 151, 225 A.2d 58, 59-60 (1966)
(absent objection, court's submission of issue of conversion to jury
became law of case); Anderson v. Knapp, 126 Vt. 129, 138-39, 225 A.2d 72,
79 (1966) (trial was conducted and proceeded on contract theory, which
became law of case). Indeed, when the court stated that it would "find
the facts and decide the issue," plaintiff's attorney asked the court to
allow her to submit a request to find. Cf. Stewart v. RCA Corp., 790 F.2d 624, 630-31 (7th Cir. 1986) (concluding that plaintiff acquiesced to
proceeding under which court would resolve factual issue controlling
whether statute of limitations had run).

In any event, the court determined, based on evidence considered in a
light most favorable to plaintiff, that plaintiff's attorney acted
unreasonably as a matter of law in allowing the statute of limitations to
expire based on the statements made by defendant's adjuster. Because we
find no genuine issues of material fact in dispute, see Tooley v. Robinson
Springs Corp., 163 Vt. 627, 629, 660 A.2d 293, 295-96 (1995) (mem.)
(disputes concerning legal significance of facts, as opposed to facts
themselves, do not preclude summary judgment), and we agree with the trial
court that defendant is entitled to judgment as a matter of law under the
facts presented, Poplaski v. Lamphere, 152 Vt. 251, 254-55, 565 A.2d 1326,
1329 (1989)

(summary judgment mandated when party fails to establish existence of
essential element on which that party has burden of proof at trial), we
uphold the court's summary judgment ruling. See O'Donnell v. Bank of
Vermont, 166 Vt. 221, 224, 692 A.2d 1212, 1214 (1997) (summary judgment
appropriate when moving party demonstrates that there are no genuine issues
of material fact and it is entitled to judgment as matter of law).

Affirmed.

FOR THE COURT:

_______________________________________
Chief Justice

------------------------------------------------------------------------------
Dissenting

No. 98-382

Wade Beecher Supreme Court

On Appeal from
v. Windham Superior Court

Stratton Corporation May Term, 1999
d/b/a Stratton Mountain Ski Resort

John P. Meaker, J.

Theodore A. Parisi, Jr., Castleton, and Martha M. Smyrski of Paterson
& Walke, P.C., Montpelier, for Plaintiff-Appellant.

John A. Serafino of Ryan Smith & Carbine, Ltd., Rutland, for
Defendant-Appellee.

PRESENT: Amestoy, C.J., Dooley, Morse, Johnson and Skoglund, JJ.

MORSE J., dissenting. The circumstances of this case, in my view,
present a triable issue for the factfinder. Plaintiff demanded a jury
trial in his complaint. Within the context of defendant's summary
judgment motion, the parties contested whether defendant should be
estopped from invoking the statute of limitations. While the parties may
have agreed to the superior court holding a hearing and taking testimony
on this issue, the court's role was still limited to determining whether
material facts were in dispute and whether either party was entitled to
judgment as a matter of law. See Bingham v. Tenney, 154 Vt. 96, 101, 573 A.2d 1185, 1187 (1990) (in context of summary judgment motion, trial court
should employ oral testimony sparingly and with great care because purpose
of proceeding is to determine only whether triable issue exists); Braun v.
Humiston, 140 Vt. 302, 306, 437 A.2d 1388, 1389 (1981) (courts are not
empowered to try issues of fact in summary judgment proceedings; they may
examine affidavits or other evidence to determine whether triable issues
exist, but may not resolve such issues).

Consider the following facts, keeping in mind the court's limited role
in this summary judgment proceeding. Defendant made at least one
settlement offer to plaintiff, but that offer was rejected. When the
parties were unable to agree upon a settlement amount, plaintiff's Vermont
attorney took over the case. At that point, nearly three quarters of the
truncated one-year limitations period had already expired. In December
1996, plaintiff's attorney sent defendant's adjuster a letter informing
him that plaintiff would be filing suit in the near future because the
case had not been settled. At that point, the limitations period was set
to expire in less than a month. The adjuster, who was responsible for
settling ski claims in Vermont and other states and thus presumably was
aware of the applicable statute of limitations, asked plaintiff's attorney
to refrain from filing suit until negotiations were complete, which could
not occur until plaintiff submitted to an independent medical examination.
When plaintiff's attorney asked the adjuster if they were going to have a
problem with the statute of limitations, the adjuster stated that he was
not aware of any problem. Although plaintiff promptly agreed to the
independent examination, the adjuster waited until after expiration of the
one-year limitations period before providing plaintiff with information
that would allow the examination to proceed.

Without question, reasonable minds could differ as to whether these
facts estopped defendant from invoking the statute of limitations.
Indeed, on strikingly similar facts in McLaughlin v. Blake, 120 Vt. 174,
180, 136 A.2d 492, 496 (1957), this Court reversed a trial court judgment
on the pleadings denying the plaintiff's claim that the defendant was
estopped from raising a statute-of-limitations defense. In that case, the
adjuster stated that there was no question about defendant's liability,
and then asked plaintiff to refrain from filing suit until a medical
end-result was reached. Here, after already having made at least one
settlement offer, the adjuster asked plaintiff to refrain from filing suit
until an independent examination could confirm the claimed injuries. I
find no significant distinction between the two cases.

The "essential" distinction noted by this Court -- that the
plaintiff's attorney in McLaughlin, unlike plaintiff's attorney here, was
ignorant of the applicable limitations period -

- was apparently not essential to the Court in McLaughlin. Indeed, the
opinion does not even indicate that the plaintiff's attorney was unaware
of the limitations period, let alone cite that fact as a basis for the
decision. On the contrary, the stated basis of the decision in McLaughlin
was that the plaintiff's attorney deferred bringing suit in response to
the adjuster's request that he refrain from doing so pending a medical
end-result, at which point the amount of compensation could be determined.
See id. at 180, 136 A.2d at 496. This is essentially what occurred here.

Our decision in Caledonia Sand & Gravel Co. v. Campbell, 128 Vt. 182,
260 A.2d 221 (1969) also demonstrates that summary judgment was wrong in
this case. In determining that the defendant was not estopped from
invoking the statute of limitations, the Court in Campbell specifically
noted the absence of any "evidence of a request that plaintiff not bring,
or defer in bringing, suit on its claim, or of any statement made which
could have induced a forbearance by plaintiff not to sue." Id. at 186,
260 A.2d at 224; see Kunstman v. Mirizzi, 44 Cal. Rptr. 707, 709 (Dist.
Ct. App. 1965) (estoppel will apply to prevent defendant from invoking
limitations period if plaintiff was induced to believe that amicable
adjustment to claim would be made without suit); cf. Machules v.
Department of Admin., 523 So. 2d 1132, 1134 (Fla. 1988) (doctrine of
equitable tolling is generally applied in cases where defendant's
representations lulled plaintiff into inaction).

Here, in contrast, defendant's agent specifically requested that
plaintiff put off filing suit. Reasonable persons could conclude that the
request induced plaintiff's attorney to delay bringing suit pending the
results of the independent examination. See Molinar v. City of Carlsbad,
735 P.2d 1134, 1137 (N.M. 1987) (estoppel applied where plaintiffs
postponed filing suit based on defendant's representations that settlement
should be forthcoming and would be more expeditious in absence of
litigation). Indeed, a jury may well have viewed the adjuster's "gotcha"
approach as an unjust way for plaintiff's suit to end, particularly given
that defendant expressly requested the delay in bringing suit and thus was
not prejudiced in the least.

I would reverse and remand because, at minimum, there is a triable
issue of fact as to

whether, considering all the circumstances of the case, the duty of honest
dealing should estop defendant from repudiating the reasonably anticipated
consequences of its representations. See McLaughlin, 120 Vt. at 179, 136 A.2d at 496 (stating test for determining whether defendant should be
estopped from raising statute-of-limitations defense).

_______________________________________
Associate Justice

------------------------------------------------------------------------------
Dissenting

No. 98-382

Wade Beecher Supreme Court

On Appeal from
v. Windham Superior Court

Stratton Corporation May Term, 1999
d/b/a Stratton Mountain Ski Resort

John P. Meaker, J.

Theodore A. Parisi, Jr., Castleton, and Martha M. Smyrski of Paterson
& Walke, P.C., Montpelier, for Plaintiff-Appellant.

John A. Serafino of Ryan Smith & Carbine, Ltd., Rutland, for
Defendant-Appellee.

PRESENT: Amestoy, C.J., Dooley, Morse, Johnson and Skoglund, JJ.

DOOLEY, J., dissenting. I agree with plaintiff that the trial court
went beyond its role in this summary judgment proceeding by finding that
plaintiff's attorney knew ahead of time when the limitations period was
going to expire. The only evidence supporting this finding is the
following two words of testimony by plaintiff's attorney:

Q: 12 V.S.A. § 513 presumes that as of January of 1997 and also
as of March 10 you were aware of the one year statute.

A: I was.

Given the odd wording of the question, which was not really a question at
all, it is not clear whether the response of plaintiff's attorney conceded
that he was presumed to be aware of the statute, or that he was aware of
the statute. Nor is it clear at what point he became aware of the
one-year limitations period, even assuming he was conceding that at some
point he had actually become aware of the statute. He may well have meant
that he became aware of the statute in March, after it had expired, when
he asked the adjuster to waive the limitations period.

In short, his brief response did not warrant the court's summary judgment
finding that plaintiff's attorney knew of the one-year limitations period
before it had expired. Without that finding, summary judgment on the
estoppel issue was inappropriate because a disputed issue of material
facts exists as to whether plaintiff's attorney was "ignorant of the true
facts." See Fisher v. Poole, 142 Vt. 162, 168, 453 A.2d 408, 412 (1982)
(setting forth elements of equitable estoppel).

_______________________________________
Associate Justice

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