Kenneth T. Riso & a. v. Gregory R. Riso & a. , 210 A.3d 879 ( 2019 )

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THE SUPREME COURT OF NEW HAMPSHIRE
___________________________
10th Circuit Court-Brentwood Probate Division
No. 2018-0268
KENNETH T. RISO & a.
v.
GREGORY R. RISO & a.
Argued: February 20, 2019
Opinion Issued: May 10, 2019
Devine, Millimet & Branch, Professional Association, of Manchester
(William F. Gramer on the brief and orally), for the petitioners.
Myskowski & Matthews, PLLC, of Concord (Jan P. Myskowski on the
brief and orally), for the respondent.
LYNN, C.J. Respondent Gregory R. Riso appeals an order of the Circuit
Court (Weaver, J.) denying his second post-trial motion for reconsideration
based on the court’s finding that he forfeited his right to a statute of limitations
defense.1 We affirm.
1 While the parties’ other siblings, Ronald R. Riso and Carolyn A. Campbell, were listed as
respondents on pleadings in the trial court, Gregory R. Riso is the sole respondent on appeal.
I
The following facts are drawn from the trial court’s orders, or are
otherwise supported by the record and undisputed on appeal. On June 8,
2016, the petitioners, Kenneth T. Riso and Rocco R. Riso, Jr., filed a petition in
the trial court requesting the partition of property in Raymond that was held by
them and their siblings as tenants in common following the death of their
mother on March 10, 2012. The petition also sought relief against the
respondent individually for money allegedly converted by the respondent from
his mother’s estate. Specifically, the petition asserted three claims against the
respondent for breach of fiduciary duty, conversion, and fraudulent
misrepresentation. These claims stemmed from two checks that the
respondent drew from his mother’s personal account under authority of a
durable power of attorney she executed prior to her death. The first check, in
the amount of $65,000, was dated March 6, 2012, and was made payable to
the respondent. The second check, in the amount of $8,825, was dated March
7, 2012, and was made payable to an individual whose deceased husband had
completed work on the property. Both checks were processed for payment on
March 15, 2012. The respondent filed an answer on August 29, 2016, in which
he asserted, among other things, that the petitioners’ claims were barred by the
statute of limitations.
After further pleadings and a structuring conference, the case proceeded
to trial. At trial, the respondent testified that the March 6 and March 7 checks
(the checks) were written at his mother’s request while she was in the hospital
prior to her death. The respondent further testified that his mother wanted
him to be reimbursed for expenses related to work he had done on the
property.
Following trial, on September 29, 2017, the petitioners submitted their
proposed findings of fact and conclusions of law to the trial court. In support
of their claim that the respondent breached his fiduciary duties, the petitioners
asserted, in Paragraph 83 of their filing, that they had not learned of the
checks until “approximately a year” after their mother’s death, when the
respondent had produced the checks in discovery during probate litigation in
Florida concerning their mother’s estate.
The trial court issued its adjudicatory order on December 4, 2017. In its
order, the court concluded that the respondent was not a credible witness, and
thus that there was no evidence that his mother had agreed to pay him for
monies he spent on the property or authorized him to sign the checks at issue.
In addition, the court found that, based on the credible evidence before it, the
checks were written after the parties’ mother had died and the respondent’s
authority under the power of attorney had ended. The court also found that
the petitioners learned of the checks “well over a year” after March 2012,
during the discovery process in separate litigation. Applying principles of
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equity, the trial court ordered that the proceeds from the sale of the home be
distributed to the mother’s children, excluding the respondent, according to
their respective ownership percentages.
Following this order, both the respondent and the petitioners filed
motions to reconsider. Both motions challenged the analysis conducted by the
trial court in its initial order. The respondent did not pursue his statute of
limitations defense in his motion to reconsider. The trial court ruled on these
motions in an order dated February 20, 2018. The court granted the
respondent’s motion to the extent that it contained arguments raised by the
petitioners in their motion for reconsideration that was also granted. At the
request of the petitioners, the court made a finding of conversion, determining
that the respondent had “wrongfully converted the funds of his mother’s estate
when he wrote and delivered the two checks.” The court declined to rule on the
petitioners’ claims for fraudulent misrepresentation and breach of fiduciary
duty. Accepting both parties’ arguments that there was insufficient evidence to
uphold the court’s original instructions on how the property’s proceeds should
be distributed, the court allowed the respondent to receive his ownership
share. However, this share was to be applied against the amount the court
found that the respondent owed the estate — i.e., the total of the checks. On
the same day that it issued this order, the trial court also granted as a finding
of fact the request contained in Paragraph 83 of the petitioners’ proposed
findings and rulings.
On March 1, 2018, nearly two years after the petition in this case was
filed and following the trial court’s ruling on the parties’ initial motions to
reconsider, the respondent filed a second motion to reconsider in which he
pursued, for the first time, the statute of limitations defense originally raised in
his answer. The trial court denied the respondent’s motion, concluding that,
by actively participating in litigation and failing to present his limitations
defense until a post-trial motion to reconsider, the respondent had forfeited his
right to the defense. This appeal followed. 2
2 While the parties do not dispute the timeliness of the respondent’s appeal, we note that
generally, under Rule 7, “successive post-decision motions,” such as a second motion to
reconsider, see Super. Ct. Civ. R. 12(e), “filed by a party that is not a newly-losing party will not
stay the running of the appeal period.” Sup. Ct. R. 7. In this instance, however, we believe that
the trial court’s analysis in its order on the parties’ motions to reconsider was significantly distinct
from its initial decision on the merits, so as to change the outcome of the case. Whereas the
respondent was denied his ownership percentage under principles of equity in the court’s original
decision, he was found liable for conversion in the court’s order on the parties’ motions to
reconsider, and ordered by the court to pay the monies owed to his mother’s estate. We find this
change in remedy significant enough to deem the respondent a “newly-losing party” under Rule 7,
and thus find his mandatory appeal from a decision on the merits timely. See Sup. Ct. R. 7.
3
II
We have not previously had occasion to consider whether a party,
through its conduct in the trial court, may abandon its ability to pursue an
affirmative defense pleaded in its answer. While generally we review a trial
court’s denial of a motion to reconsider for an unsustainable exercise of
discretion, see Broom v. Continental Cas. Co., 152 N.H. 749, 752 (2005), the
issue presented by this appeal more closely resembles that of a trial court’s
finding of waiver, which we review for clear error, see So. Willow Properties v.
Burlington Coat Factory of N.H., 159 N.H. 494, 499 (2009) (“Waiver is a
question of fact and we will not overturn the trial judge’s determination unless
clearly erroneous.”). We observe that the trial court, in denying the
respondent’s motion for reconsideration, concluded that he had “forfeited” his
limitations defense. We have recognized in the past that the terms “waiver”
and “forfeiture” are not synonymous. See State v. Richard, 160 N.H. 780, 786
(2010) (“Whereas forfeiture is the failure to make the timely assertion of a right,
waiver is the intentional relinquishment of a known right.” (quotation omitted)).
However, our precedents reflect that we have traditionally included in our
analysis of waiver evidence of a party’s conduct that justifies “an inference of a
relinquishment” of a right, even if not explicitly expressed. So. Willow
Properties, 159 N.H. at 499; N. Country Envtl. Servs. v. Town of Bethlehem,
146 N.H. 348, 354 (2001). Thus, we apply clear error review to the
circumstances of this appeal, while acknowledging that “where a litigant’s
action or inaction is deemed to incur the consequence of loss of a right, or, as
here, a defense, the term ‘forfeiture’ is more appropriate.” AIIC v. Robert
Seuffer GMBH & Co. KG, 9 N.E.3d 289, 291 n.2 (Mass. 2014) (quotation and
brackets omitted). For this reason, “we use the term forfeiture rather than
waiver in our analysis.” Id.
The respondent first contends that by pleading the defense in his
answer, he notified the petitioners of the defense “at the earliest stage
possible,” allowing them the opportunity to produce rebuttal evidence and
ensuring that they would not be surprised or unduly prejudiced by a later
assertion of the defense. The petitioners, on the other hand, assert that,
because the respondent pleaded the defense in his answer, it was then his
burden to prove the elements of the defense. They further argue that it was not
until after the respondent had so proven the defense, that they had an
obligation to present rebuttal evidence.
Statutes of limitations govern the period within which actions must be
brought, Lakeman v. LaFrance, 102 N.H. 300, 303 (1959), and are “designed to
expedite the orderly administration of justice,” Torr v. Dover, 107 N.H. 501,
503 (1967). The parties do not dispute that the statute of limitations
applicable here is RSA 508:4, I. It provides:
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Except as otherwise provided by law, all personal actions, except
actions for slander or libel, may be brought only within 3 years of
the act or omission complained of, except that when the injury and
its causal relationship to the act or omission were not discovered
and could not reasonably have been discovered at the time of the
act or omission, the action shall be commenced within 3 years of
the time the plaintiff discovers, or in the exercise of reasonable
diligence should have discovered, the injury and its causal
relationship to the act or omission complained of.
RSA 508:4, I (2010).
In support of his argument, the respondent asserts that the trial court’s
finding of forfeiture “is contrary to the public policy behind the statute of
limitations.” He contends that statutes of limitations are designed to “eliminate
stale or fraudulent claims,” “promote repose by giving security and stability to
human affairs,” and prevent plaintiffs from sleeping on their rights. He further
argues that the trial court’s ruling is unfair, as it requires him to “defend
claims against him after memories have faded” and fails to “give security to
potential defendants that they will not be required to defend against stale
claims.”
While we agree with the respondent that the “principal purpose” behind
statutes of limitations is to “eliminate stale or fraudulent claims,” see West
Gate Village Assoc. v. Dubois, 145 N.H. 293, 298 (2000), we note that in relying
on these policy considerations, the respondent has overlooked the procedures
set in place to address claims that may be filed outside of the applicable
statutory timeframes. These procedures clearly put the burden on the
respondent to both raise and timely pursue a statute of limitations defense. As
we have previously stated, the statute of limitations constitutes an affirmative
defense that the defendant bears the burden of proving. Beane v. Dana S.
Beane & Co., 160 N.H. 708, 712 (2010).
The respondent further contends that, having been put on notice by his
answer, it was the petitioners who failed to present any evidence of the
discovery rule — i.e., that they were unaware of their injury until a point in
time within the statute of limitations. See id. at 713. According to our case
law, however, the respondent was required to do more than just put the
petitioners on notice before they were expected to produce rebuttal evidence.
See id. at 712-13. As we indicated in Beane, it is only after a defendant has
established that the statute of limitations would bar the action that the plaintiff
has the burden of raising and proving the applicability of the discovery rule.
See id. at 713 (emphasis added); see also 51 Am. Jur. 2d Limitations of Actions
§ 397, at 803-04 & nn.1, 2 (2011) (stating that while some jurisdictions follow
the rule that “once the defendant has pleaded the statute of limitations, the
burden is on the plaintiff to show that the action was brought within the
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applicable period,” New Hampshire precedent places the burden on the
defendant to prove “every element necessary to establish it”). Thus, contrary to
the respondent’s assertion on appeal, there was no obligation on the part of the
petitioners to put forth evidence rebutting the statute of limitations defense
until the respondent had proven its applicability to the case. Beane, 160 N.H.
at 713.
The respondent also argues that the trial court erred in finding his
limitations defense forfeited because, having been put on notice by his answer,
the petitioners were not surprised or unduly prejudiced by his post-trial
pursuit of the defense. In support of this argument, he cites Bryant v. Wyeth,
Inc., 816 F. Supp. 2d 329 (S.D. Miss. 2011). We find this case inapposite. In
Bryant, the court stated that a statute of limitations defense that is raised in
an answer is not forfeited, so long as it is pursued at “a pragmatically sufficient
time.” Id. at 332-33 (quotation omitted). There, the court concluded that the
defendant had sought dismissal on statute of limitations grounds “well in
advance of trial,” and thus that the plaintiff had failed to show “that any delay
ha[d] adversely affected its ability to fully and adequately respond to the motion
on the facts and the law.” Id. at 333.
Here, however, the respondent engaged in active litigation, including
proceeding to trial on the merits and filing an initial motion to reconsider, yet
failed “to pursue the statute of limitations defense in any way until his filing of
a second motion for reconsideration.” Indeed, the trial court concluded that,
after raising the defense in his answer, the respondent failed to: (1) conduct
discovery in furtherance of the defense, e.g., through depositions,
interrogatories, or requests for admissions; (2) pursue the defense in his pre-
trial pleadings or in his post-trial memorandum of law; (3) press the defense at
the structuring conference or at trial; or (4) assert the defense in his first
motion to reconsider. Most importantly, the trial court noted that the
respondent failed to comply with Probate Division Rule 62, which mandates
that, ten days prior to the structuring conference, the parties “shall file
summary statements necessary to support their respective claims, defenses or
counterclaims.” Prob. Div. R. 62 (emphases added). Rule 62 further provides
that the summary statements “shall be comprehensive and made in good
faith,” and that “[t]he purpose of [the statement] is to apprise the court of the
nature of the claims, defenses, and legal issues likely to arise.” Id. (emphases
added). As found by the trial court, however, “the respondent’s summary
statement made no mention of a statute of limitations defense,” and similarly,
he did not raise a limitations defense at the subsequent structuring conference.
Thus, unlike Bryant, the respondent here did not pursue his limitations
defense “well in advance of trial,” Bryant, 816 F. Supp. 2d at 333, but instead
waited until after trial had concluded, and a decision on the merits had issued,
to press the defense. That the respondent delayed the pursuit of his defense
until after trial also sets this case apart from the other cases relied upon by the
respondent, all of which involve circumstances in which the defendant pursued
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its limitations defense prior to trial. See Wright v. Food Giant, Inc., 394 S.E.2d
610, 611 (Ga. Ct. App. 1990) (stating that limitations defense raised in answer
was pursued before trial in a motion for summary judgment); Daingerfield
Island Protective Soc. v. Babbitt, 40 F.3d 442, 444 (D.C. Cir. 1994) (stating that
limitations defense raised in answer, although pursued after first appeal, was
pressed prior to trial in a motion for summary judgment).
The Supreme Judicial Court of Massachusetts has provided guidance in
determining whether a trial court has erred in finding that a party, despite
having timely raised an affirmative defense in its answer, has forfeited that
defense through its conduct in the trial court. See AIIC, 9 N.E.3d at 297-98.
In AIIC, the court was tasked with deciding whether the trial court had
correctly ruled that the defendant forfeited its defense of lack of personal
jurisdiction. Id. at 291, 293. In so doing, the court stated that “[t]he inquiry
whether a party has forfeited a defense . . . necessarily will be fact sensitive,
requiring a thorough assessment of the parties’ conduct throughout the
litigation.” Id. at 297. The court then listed “[f]actors that could be relevant to
such an inquiry,” including: (1) “the amount of time that has elapsed, as well
as the changed procedural posture of the case, in the period between the
party’s initial and subsequent assertion of the defense”; (2) “the extent to which
the party engaged in discovery on the merits”; and (3) “whether the party
engaged in substantive pretrial motion practice or otherwise actively
participated in the litigation.” Id. at 297-98.
In looking to AIIC, we recognize that an affirmative defense of lack of
personal jurisdiction is different in nature from an affirmative defense based
upon the statute of limitations. See id. at 296 & n.10. A party who has raised
a personal jurisdiction defense in its answer may signal to a trial court “that it
is submitting to the court’s jurisdiction” merely by filing further pleadings or
appearing before the court in future stages of the litigation. See id. at 261,
293, 299 (upholding trial court’s finding of forfeiture where the defendant
engaged in litigation for 20 months before pursuing a defense of personal
jurisdiction through a motion for summary judgment). In contrast, a party
who has raised a limitations defense in its answer may need to proceed further
in the litigation without invoking the statute of limitations before it is
appropriate for the trial court to conclude that the defense has been forfeited.
See Bryant, 816 F. Supp. 2d at 333 (concluding that limitations defense raised
in answer, although not pursued in a motion for summary judgment until over
eight years later, was still pressed “well in advance of trial,” and therefore was
not forfeited); Wright, 394 S.E.2d at 611 (reaching similar conclusion where
defendant waited a year and a month before pursuing limitations defense in
summary judgment motion). Notwithstanding this distinction, we find the
factors set forth in AIIC to be instructive. Cf. Raposo v. Evans, 882 N.E.2d
356, 361-62 (Mass. App. Ct. 2008) (considering similar factors in concluding
defendant forfeited affirmative defense of insufficiency of service of process).
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In considering the particular circumstances of this case, along with the
factors set forth above, we conclude that the trial court’s determination of
forfeiture was not clearly erroneous. Between the filing of the respondent’s
answer and his second motion to reconsider, the procedural posture of the case
had changed substantially. Most importantly, the trial court had issued a
post-trial decision on the merits. Furthermore, as found by the trial court,
prior to pursuing his limitations defense, the respondent had actively engaged
in litigation without pressing the defense, including filing substantive pretrial
memoranda, participating in trial, and moving the trial court to reconsider its
final order.3 Given the circumstances of this case, we believe that the trial
court did not clearly err in finding that the respondent forfeited his limitations
defense.
The respondent next argues that he had no reason to further his defense
beyond the filing of his answer because the petition, on its face, demonstrated
a violation of the statute of limitations. Specifically, he asserts that because
the petition stated that the parties’ mother died on March 10, 2012, and the
petition was not filed until June 8, 2016, it was clear from the face of the
petition that the event on which the petitioners’ personal action was based —
the parties’ mother’s death — occurred more than three years prior to the filing
of the petition. This argument is flawed, however, as the parties’ mother’s
death was not the event on which the petitioners’ claims were based. The
claims against the respondent individually, which form the basis of this appeal,
arose from the respondent’s negotiation of the checks. And although the dates
on which the checks were negotiated were alleged in the petition, at no time
during the trial or in its initial motion to reconsider did the respondent alert
the trial court that these dates had any significance with respect to the proper
disposition of the case. In the absence of the respondent bringing this issue to
the trial court’s attention, the court had no duty to sua sponte dismiss the case
on the grounds that the claims were barred by the statute of limitations. See
Exeter Hospital v. Hall, 137 N.H. 397, 399-400 (1993) (stating that while the
procedural rules do not prohibit a trial court judge from raising a limitations
defense sua sponte, there is no requirement in the rules that a judge do so
either).
3 We also note that, under our case law, trial courts have discretion whether to consider
arguments raised for the first time in a motion to reconsider. See Smith v. Shepard, 144 N.H.
262, 265 (1999) (stating that where a party raises an issue for the first time in a motion to
reconsider, the trial court has the discretion “to either not consider the issue or re-open the record
and allow the parties to present evidence” (quotation omitted)). While we realize that the
respondent here did not raise his statute of limitations defense for the first time in his second
motion to reconsider, having technically raised it in his answer, we find it noteworthy that he did
not seek to establish it in any way until that time. See id. at 264 (stating that the purpose of a
motion for reconsideration is to allow “a party to present points of law or fact that the [c]ourt has
overlooked or misapprehended” (quotation omitted)).
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The respondent alternatively argues that he timely pursued his statute of
limitations defense when he advanced it in his second motion to reconsider,
because it was not until after trial, when the petitioners filed their proposed
factual findings, that he discovered that the petitioners had knowledge, as early
as March 2013, of their possible claims against the respondent. This assertion
is not supported by the record. First, it is evident from the respondent’s
pleading of the defense in his answer that he was at least aware of the
possibility of a limitations problem at the start of the case. Second, the fact
that the petitioners learned of the checks “approximately a year” after March
2012 was available to the respondent at least by the time of trial,4 and certainly
before the respondent filed his first motion to reconsider. While the
respondent’s initial motion to reconsider was filed on December 14, 2017, the
petitioners’ proposed findings of fact were submitted on September 29, 2017,
and the final trial order, in which the trial court found that the petitioners
discovered the checks “well over a year” after March 2012, was issued on
December 4, 2017. Third, the exact date on which the petitioners learned of
the checks, and more importantly, on which they learned of an injury caused
by the checks, was never before the trial court because the applicability of the
statute of limitations was never established by the respondent. As stated
above, once the defense was pleaded in the respondent’s answer, the burden to
timely establish that defense rested with him, and it was not until this burden
was met that the petitioners were required to produce evidence of the
applicability of the discovery rule. See Beane, 160 N.H. at 712-13.
At oral argument, the respondent asked us to consider an inherent
unfairness that may be present in the statute of limitations, namely that, by
default, the statute of limitations allows the plaintiff, by filing an untimely
claim, to put the defendant in the position of having to expend time and
resources litigating a defense. The respondent urged that this scenario can be
avoided by a plaintiff’s compliance with the statute of limitations. We find this
argument unpersuasive. As stated above, the statute of limitations is an
affirmative defense that places the burden of proof on the defendant. See id. It
is true, as the respondent argues, that placement of the burden on the party
asserting the limitations bar may mean that a defendant seeking to rely on this
defense will have to devote time and resources to establish it. The imposition
of this burden is appropriate, however, given that the statute of limitations can
operate to preclude what would otherwise be a meritorious claim.
Furthermore, the time and resources expended in pursuing the defense most
likely will pale in comparison to the effort that would be spent should the case
be fully litigated through to a trial on the merits. Indeed, this is precisely why
we have instructed that whether a statute of limitations defense is applicable
4 Although the respondent has not furnished us with a trial transcript, he does not contend that
the petitioners’ request for a finding of fact that the petitioners first learned of the checks in March
2013 was not supported by the evidence presented at trial. Since the court granted the finding,
we assume that it was supported by the evidence.
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should ordinarily be determined “at a preliminary hearing in advance of trial.”
Sundell v. Town of New London, 119 N.H. 839, 848 (1979) (quotation omitted).
For the reasons stated above, we conclude that the trial court did not
clearly err in finding that the respondent had forfeited his statute of limitations
defense, and thus affirm the court’s denial of the respondent’s second motion
for reconsideration.
Affirmed.
HICKS, BASSETT, HANTZ MARCONI, and DONOVAN, JJ., concurred.
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