Angelina Rae Hubbard Findley v. Richard Odel Hubbard ( 2018 )

07/02/2018
IN THE COURT OF APPEALS OF TENNESSEE
AT NASHVILLE
April 10, 2018 Session
ANGELINA RAE HUBBARD FINDLEY, ET AL. V. RICHARD ODEL
HUBBARD, ET AL.
Appeal from the Chancery Court for Marion County
No. 7880 Jeffrey F. Stewart, Chancellor
No. M2017-01850-COA-R3-CV
This appeal arises from a civil action filed in 2016 to establish a constructive trust and/or
resulting trust to a share of the $25,500,000 proceeds from a 2005 Tennessee Lottery
ticket. The essence of the claim is that the defendants, who are the respective former
spouses and mother and father in-law of the plaintiffs, wrongfully deprived the plaintiffs
of their rightful shares to the lottery proceeds. The defendants filed a Tenn. R. Civ. P.
12.02(6) motion to dismiss all claims for failure to state a claim on grounds including the
statute of limitations. The plaintiffs responded contending, inter alia, that their respective
claims did not accrue until 2007 for one of them and 2010 for the other, and that their
claims were timely because the “catch all” 10 year statute of limitations in Tenn. Code
Ann. § 28-3-110(a)(3) applied to constructive and resulting trusts. The trial court
disagreed and dismissed all claims as time barred. We affirm.
Tenn. R. App. P. 3 Appeal as of Right; Judgment of the Chancery Court Affirmed
FRANK G. CLEMENT JR., P.J., M.S., delivered the opinion of the Court, in which RICHARD
R. DINKINS and THOMAS R. FRIERSON II, JJ., joined.
H. Graham Swafford, Jr., Jasper, Tennessee, for the appellants, Angelina Rae Hubbard
Findley and Stacey Lynnette Hubbard.
Joseph R. White, Cassie C. Rieder, and William J. Rieder, Chattanooga, Tennessee, for
the appellees, Richard Odel Hubbard, Bobbi LeNell Hubbard, Brent Loy Hubbard, and
Richard Brian Hubbard.
OPINION
Although the record on appeal provides all that is needed to resolve the issues, the
factual history in the record is modest. This is because the initial defendants, Richard
Odell Hubbard and wife, Bobbi LeNell Hubbard, (“Defendants”) responded to the
complaint with a Tenn. R. Civ. P. 12.02(6) motion to dismiss based on the statute of
limitations defense. Due to the scarcity of facts in the trial court record, Angelina Rae
Hubbard Findley and Stacey Lynnette Hubbard (“Plaintiffs”), former daughter-in-laws of
Defendants, proffer facts in their joint brief that are not supported by the record.
Although these proffered facts have no bearing on the outcome of this case, we will
include some of the facts proferred to give context to the history of this case.
Defendants owned and operated a NAPA Auto Parts store in South Pittsburg,
Tennessee, where they “sold lottery tickets in addition to auto parts.” In April of 2005,
while working at the counter of the NAPA Auto Parts store, Angelina Findley,
Defendants’ daughter-in-law, sold a lottery ticket to a customer. Shortly thereafter, the
customer returned to the store insisting that the numbers on the ticket were not the ones
the customer wanted. Pursuant to store policy, Ms. Findley issued the customer a new
ticket in exchange for the wrong and unwanted ticket.1 The same store policy stated that
if an employee of the NAPA Auto Parts store made an error in selling a ticket, the
employee was required to buy the ticket. Ms. Findley states in her brief that she followed
that policy and bought the wrongly issued ticket.
Several weeks later, in early April of 2005, Ms. Findley received a frantic phone
call and was told to return to the store. When she arrived, she was informed that the
returned ticket had won the $25,500,000 Lottery and, as the complaint reads, “[a]t the
time of the winning, it was considered to be owned by the Defendants, their two sons and
the Plaintiffs.”
For reasons unexplained by the record, Plaintiffs’ relationships with their
respective spouses soured thereafter. Angelina Findley and her husband, Brent Hubbard,
divorced on May 22, 2007, while Stacey Hubbard and her husband, Richard Brian
Hubbard, divorced on August 22, 2006. Most surprisingly, the record provides no
information regarding the disposition of the marital assets from either divorce. Moreover,
upon inquiry from the panel at oral argument, counsel were unable to provide any
information regarding the division of the marital assets, particularly whether any portion
of the lottery proceeds, or any portion thereof, were or were not marital property.
On September 13, 2016, Plaintiffs commenced this action in the Chancery Court
for Marion County contending that following their divorces, Defendants “wrongfully
depriv[ed] the Plaintiffs . . . of their rightful winnings.” The facts and legal theory as
stated in the initial complaint read:
FACTS
1
Ironically, the wrong and unwanted ticket was soon worth $25,500,000.
-2-
In 2005, the Plaintiffs were winners of a lottery ticket valued at twenty-five
million, five hundred thousand dollars ($25,500,000).
At the time of the winning, it was considered to be owned by the
Defendants, their two sons and the Plaintiffs.
The Plaintiffs and the Defendants’ sons were divorced.
The Defendants took all of the money wrongfully depriving the Plaintiffs of
any of their rightful winnings.
LEGAL THEORY
The Plaintiffs were, in fact, owners of the lottery winnings. The Defendants
improperly took the Plaintiffs’ share. The Plaintiffs are entitled to their
share under theories of a constructive trust and/or resulting trust along with
other theories equitable and otherwise.
In pertinent part, the relief prayed for reads:
Monies and/or a portion of the monies won in a State of Tennessee lottery
should be declared, held in a resulting, presumptive and/or constructive
trust for the benefit of the Plaintiffs. Thereafter Plaintiffs should be
awarded their share of the money/winnings.
In lieu of filing an answer, Defendants filed a Tenn. R. Civ. P. 12.02(6) motion to
dismiss for failure to state a claim upon which relief can be granted. In pertinent part,
Defendants argued:
In this case, Plaintiffs have not stated a claim upon which relief can be
granted. In their Complaint, they do not list any accusations of fraud,
breach of duty, undue influence, etc. to establish a constructive trust over
the proceeds. Likewise, they have not listed any facts or allegations in their
Complaint that would create a resulting trust over the subject lottery
winnings.
Moreover, as Plaintiffs note in their Complaint, the subject lottery proceeds
were won in 2005. The statute of limitations in Tennessee for the detention
or conversion of personal property is three (3) years, for breach of contract
is six (6) years, and for all cases not expressly provided for by statute is ten
(10) years. Tenn. Code Ann. §§ 28-3-105, 28-3-109, 28-3-110. The only
date mentioned in Plaintiffs’ Complaint is 2005, more than ten (10) years
-3-
ago. Therefore, Plaintiffs’ Complaint is barred by any applicable statute of
limitations.
The trial court denied the motion, but ordered Plaintiffs to amend their Complaint
“to add specificity such that the Defendants may determine the applicability of any
statute of limitations defense.” The Amended Complaint stated, in pertinent part: “The
statute of limitations for the Plaintiff, Angelina Rae Hubbard Findley, is thought to be
August 2007. The statute of limitations for the Plaintiff, Stacey Lynnette Hubbard, is
thought to be January 2010.” The ex-husbands, Brent Loy Hubbard and Richard Brian
Hubbard,2 were added “as parties to this lawsuit as coconspirators,” and the Amended
Complaint included the following additional allegations:
The parties conspired and/or agreed and/or by combination both
individually and as a group to improperly deprive the Plaintiffs’ of their
share of a lottery winning.”
Among other things, specifically and with particularity the Defendants,
both individually and/or pursuant to a conspiracy, against the Plaintiffs did
one or all of the following:
(a) The Defendants agreed to split lottery winnings and
fraudulently kept the money.
(b) The Defendants promised jobs and/or financial security
which was [sic]ignored.
(c) The Defendants, Richard and Bobbi Hubbard, privately
sought legal counsel unknown to the Plaintiffs and/or their
sons and have fraudulently concealed the facts to this day.
(d) The Defendants kicked the Plaintiff(s) out of their
house(s).
(e) The Plaintiffs had no place to live, and the Defendants did
not provide a place to live after promising homes.
(f) The Defendants fraudulently mislead the Plaintiffs about
tax law, corporate law and/or ramifications to their detriment.
(g) The Defendants fraudulently made representations
concerning jobs and/or future security that were not followed.
(h) The Defendants fraudulently promised school and/or
educational funding which was not provided.
(i) The Defendants threatened to take the Plaintiffs’ vehicles.
2
Hereinafter, the reference to “Defendants” collectively refers to all four defendants, Richard
Odell Hubbard, Bobbi LeNell Hubbard, and their sons, Brent Loy Hubbard and Richard Brian Hubbard.
-4-
(j) The Defendants both scared and intimidated the Plaintiffs,
and they continue to do so.
(k) The Defendants fraudulently concealed facts, including
but not limited to financial reports, financial condition, tax
law and/or ramifications, etc.
(I) The Defendants fraudulently mislead the Plaintiffs at
every stage concerning their rights and/or options.
(m) The Plaintiffs were promised payment every year which
was fraudulently withheld.
In the prayer for relief, the Amended Complaint also states: “The Plaintiffs adopt all
averments in the original Complaint including the averments of fraud, conspiracy,
resulting and/or constructive trust and/or the request for relief sought.”
Thereafter, Plaintiffs filed a “Second Amended Complaint” in which they
additionally alleged:
By order resulting from a hearing on December 13, 2016 denying a Rule 12
Motion filed by the Defendants, the Plaintiffs were ordered to “amend their
Complaint to provide specificity such that the Defendants may determine
the applicability of any statute of limitations defense”.
The Plaintiffs have complied. They further supplement the pleadings by
stating in this “Second Amended Complaint” that in this case there is no
applicable statute of limitations and/or any limitation of actions that would
bar the matter from going forward to a full and complete adjudication of the
facts.
It is insisted there is no applicable statute of limitations and/or of repose.
Thereafter, Defendants filed a second motion to dismiss in which they noted that
the Amended Complaint states, “The statute of limitations for the Plaintiff, Angelina Rae
Hubbard Findley, is thought to be August 2007. The statute of limitations for the
Plaintiff, Stacey Lynnette Hubbard, is thought to be January 2010.” After also noting that
this action was not commenced until 2016, Defendants contended: (1) that Plaintiffs’
fraud allegations are barred by the three (3) year statute of limitations codified in Tenn.
Code Ann. § 28-3-105; (2) Plaintiffs’ allegations of conspiracy are barred by the three
year statute of limitations codified in Tenn. Code Ann. § 28-3-105; (3) Plaintiffs’
constructive trust and resulting trust assertions are barred by the three year statute of
limitations for breach of fiduciary duty; and (4) Plaintiffs’ constructive trust and resulting
trust assertions are barred by the six year statute of limitations for breach contract
codified in Tenn. Code Ann. § 28-3-109. Plaintiffs then filed responses to the motion.
-5-
After the parties were afforded the opportunity to argue the issues raised by the
Tenn. R. Civ. P. 12.02(6) motion to dismiss in court, the trial court found that all of
Plaintiffs’ claims were “time barred by their applicable statute of limitations,” and
granted Defendants’ Motion to Dismiss. In its oral ruling from the bench, the court found
that the claims of fraud and conspiracy had a three-year statute of limitations, which
expired in August 2010 for Plaintiff Findley and January 2013 for Plaintiff Hubbard.
Additionally, the trial court found that Plaintiffs’ constructive and resulting trust claims,
which fell under the three-year statute of limitations for breach of fiduciary duty, would
likewise be time barred. The trial court further ruled:
The final issue raised was the matter of constructive and resulting trusts.
There was a question raised about whether a statutory scheme that had been
passed by the legislature found [at] 35-15-101 and . . . specifically referring
to 35-15-1005(a) and (b) talking about a duty of a trustee to report things in
a detailed statement of facts.
But in reading that statute, constructive and resulting trusts were
specifically excluded at least by way of comment that those would be
equitably constructed and not dealt with by that statute. So having looked at
that, there is a six-year statute of limitations for breach of contract under
28-3-109. And I find that the six-year statute of limitations would have run
. . . starting in . . . January of 2010 and would have expired in January of
2016.
Thus, having ruled that each of the statute of limitations has expired to the
four issues that were specifically pled, I find that the catchall 10-year
statute of limitations would not apply to the facts pled in this case. And,
therefore, I grant the Rule 12.01(6) motion to dismiss.
This appeal followed.
ISSUE
The dispositive issue in this case is whether the trial court erred in dismissing the
case pursuant to Tenn. R. Civ. P. 12.02(6) on the ground that all of the claims are time-
barred.3 Nevertheless, Plaintiffs present other issues, two of which we will also discuss:
3
Plaintiffs state in their brief that the following are the four issues on appeal:
1. Can the statute of limitations be asserted as a single dispositive Rule 12.02
defense/response?
2. Is there a statute of limitations involving declaration of a “constructive and/or resulting
trust”? If so, what is the statute of limitations?
(continued…)
-6-
1. Can the statute of limitations be asserted as a single dispositive Rule
12.02 defense/response?
•••
3. Did the trial court err in dismissing this case based upon the statute of
limitations without allowing the Plaintiffs to develop their case?4
ANALYSIS
I. TENNESSEE RULE OF CIVIL PROCEDURE 12.02(6)
A Tenn. R. Civ. P. 12.02(6) motion to dismiss challenges only the legal
sufficiency of the complaint, not the strength of the plaintiff’s proof or evidence. Webb v.
Nashville Area Habitat for Humanity, Inc., 346 S.W.3d 422, 426 (Tenn. 2011). The
resolution of a Rule 12.02(6) motion to dismiss is determined by an examination of the
pleadings alone. Id. A defendant who files a motion to dismiss “admits the truth of all of
the relevant and material allegations contained in the complaint, but . . . asserts that the
allegations fail to establish a cause of action.” Id. (quoting Brown v. Tenn. Title Loans,
Inc., 328 S.W.3d 850, 854 (Tenn. 2010)).
When considering a motion to dismiss, courts “must construe the complaint
liberally, presuming all factual allegations to be true and giving the plaintiff the benefit of
all reasonable inferences.” Id. (quoting Tigg v. Pirelli Tire Corp., 232 S.W.3d 28, 31-32
(Tenn. 2007)). “A trial court should grant a motion to dismiss ‘only when it appears that
the plaintiff can prove no set of facts in support of the claim that would entitle the
plaintiff to relief.’” Id. (quoting Crews v. Buckman Labs. Int’l, Inc., 78 S.W.3d 852, 857
(Tenn. 2002)). We review the trial court’s legal conclusions regarding the adequacy of
the complaint de novo. Id.; Brown, 328 S.W.3d at 855.
In this appeal, Plaintiffs contend that the statute of limitations cannot be asserted
as a single dispositive Rule 12.02 defense or response. We disagree.
3. Did the trial court error in dismissing this case based upon the statute of limitations
without allowing the Plaintiffs/Appellants to develop their case?
4. The appellants ask the court to declare when there is uncertainty as to the statute of
limitations that there should be no statute of limitations or statute of limitations is ten
years.
4
We will not address Plaintiffs’ fourth issue, by which Plaintiffs are asking this court to render an
advisory opinion. See State v. Brown & Williamson Tobacco Corp., 18 S.W.3d 186, 193 (Tenn. 2000).
We also note that during oral argument, in response to a question from the court regarding the legal basis
for his contention that no statute of limitations applies to constructive or resulting trusts, Plaintiffs’
counsel replied “optimism.” Because Plaintiffs failed to cite to relevant authority for this proposition, we
deem the issue waived. See Tenn. R. App. P. 27(a)(7).
-7-
The statute of limitations defense is one of the affirmative defenses identified in
Tenn. R. Civ. P. 8.03. “In pleading to a preceding pleading, a party shall set forth
affirmatively facts in short and plain terms relied upon to constitute . . . statute of
limitations, . . . and any other matter constituting an affirmative defense.” Id. (emphasis
added). A corresponding rule, Tenn. R. Civ. P. 12.02, states in pertinent part:
Every defense, in law or fact, to a claim for relief in any pleading, whether
a claim, counterclaim, cross-claim, or third-party claim, shall be asserted in
the responsive pleading thereto if one is required, except that the following
defenses may at the option of the pleader be made by motion in writing: . . .
(6) failure to state a claim upon which relief can be granted. . . . A motion
making any of these defenses shall be made before pleading if a further
pleading is permitted. No defense or objection is waived by being joined
with one or more other defenses or objections in a responsive pleading or
motion.
Id. (emphasis added).
As the foregoing rules provide, and as a plethora of judicial decisions have
confirmed, the statute of limitations may be asserted as a dispositive Rule 12.02(6)
defense. See Thigpen v. Trousdale Cty. Highway Dep’t, No. M2016-02556-COA-R3-CV,
2017 WL 4158687, at *2 (Tenn. Ct. App. Sept. 19, 2017) (“A statute of limitations
defense is appropriately addressed in a motion to dismiss under Rule 12.02(6) of the
Tennessee Rules of Civil Procedure for failure to state a claim upon which relief can be
granted.”). Moreover, as our courts have stated, there are meritorious reasons for statutes
of limitations.
Statutes of limitations promote fairness and justice. They are shields, not
swords, and they reflect “‘a societal choice that actions must be brought
within a certain time period.’” They are based on the presumption that
persons with the legal capacity to litigate will not delay bringing suit on a
meritorious claim beyond a reasonable time.
We have frequently pointed out that statutes of limitations (1) promote
stability in personal and business relationships, (2) give notice to
defendants of potential lawsuits, (3) prevent undue delay in filing lawsuits,
(4) “avoid the uncertainties and burdens inherent in pursuing and defending
stale claims,” and (5) “ensure that evidence is preserved and facts are not
obscured by the lapse of time or the defective memory or death of a
witness.” Accordingly, the courts construe exceptions to statutes of
limitations carefully to assure that they are not extended beyond their plain
meaning.
-8-
Redwing v. Catholic Bishop for Diocese of Memphis, 363 S.W.3d 436, 456 (Tenn. 2012)
(internal citations omitted).
Accordingly, the statute of limitations can be, and often is, asserted as a single
dispositive Rule 12.02 defense.
II. OPPORTUNITY TO DEVELOP CASE
Plaintiffs also contend the trial court erred by dismissing the case “without
allowing Plaintiffs to develop their case.” We find this contention unavailing.
A Rule 12.02 motion to dismiss requires the movant, here Defendants, and the trial
court to “admit[] the truth of all of the relevant and material allegations contained in the
complaint. . . .” Webb, 346 S.W.3d at 426 (quoting Tenn. R. Civ. P. 12.02.); see Brown,
328 S.W.3d at 854. Moreover, when considering a motion to dismiss, the court “must
construe the complaint liberally, presuming all factual allegations to be true and giving
the plaintiff the benefit of all reasonable inferences.” Id. (quoting Tigg, 232 S.W.3d at 31-
32). The undisputed material facts at issue when considering a Rule 12 motion are those
stated in the complaint. Accordingly, a plaintiff is in control of his or her own fate, at
least as far as the material facts are concerned.
Here, the Complaint, Amended Complaint and Second Amended Complaint reveal
that Plaintiffs knew the following material facts: that the lottery ticket at issue was the
winning ticket in April of 2005; that Plaintiffs knew they did not receive their share of the
proceeds, despite an alleged agreement “to split lottery winnings;” that Defendants failed
to honor “the promised jobs and/or financial security;” that “Defendants kicked the
Plaintiff(s) out of their house(s);” and that they “were promised payment every year,” but
no payments were made. Because Plaintiffs knew these facts as early as 2005, or at the
latest by 2007 for Plaintiff Findley, and 2010 for Plaintiff Stacey Hubbard, it begs the
question, “What facts need to be developed or discovered?”
As for conducting discovery, Plaintiffs failed to present to the trial court a bona
fide reason for conducting discovery prior to ruling on the motion. Whether to permit or
limit discovery is a decision left to the sound discretion of the trial court. See Johnson v.
Nissan N. Am., Inc., 146 S.W.3d 600, 604 (Tenn. Ct. App. 2004); Benton v. Snyder, 825
S.W.2d 409, 416 (Tenn.1992); Payne v. Ramsey, 591 S.W.2d 434, 436 (Tenn.1979);
Harrison v. Greeneville Ready–Mix, Inc., 417 S.W.2d 48, 52 (Tenn. 1967). We review a
trial court’s discretionary decisions pursuant to the “abuse of discretion” standard of
review. Id.
-9-
Because Plaintiffs have provided no basis on which to conclude that the trial court
abused its discretion in this regard, we find no error with the trial court’s decision to rule
on the motion to dismiss without allowing Plaintiffs to “develop their case.”
III. THE UNIFORM TRUST CODE
Plaintiffs assert that Tenn. Code Ann. § 35-15-1005(a)-(b) applies to constructive
and/or resulting trusts. We have determined that the statute does not apply to the claims
asserted by Plaintiffs in this case.
Tenn. Code Ann. § 35-15-1005(a)-(b) states:
(a) A beneficiary, trustee, trust advisor, or trust protector shall not
commence a proceeding against a trustee, former trustee, trust advisor, or
trust protector for breach of trust more than one (1) year after the earlier of:
(1) The date the beneficiary, trustee, trust advisor, or trust
protector or a representative of the beneficiary, trustee, trust
advisor, or trust protector was sent information that
adequately disclosed facts indicating the existence of a
potential claim for breach of trust; or
(2) The date the beneficiary, trustee, trust advisor, or trust
protector or a representative of the beneficiary, trustee, trust
advisor, or trust protector possessed actual knowledge of facts
indicating the existence of a potential claim for breach of
trust.
(b) For purposes of this section, facts indicate the existence of a potential
claim for breach of trust if the facts provide sufficient information to enable
the beneficiary; trustee; trust advisor; trust protector; or the representative
of the beneficiary, trustee, trust advisor, or trust protector to have actual
knowledge of the potential claim, or have sufficient information to be
presumed to know of the potential claim or to know that an additional
inquiry is necessary to determine whether there is a potential claim.
Plaintiffs reliance on the Tenn. Code Ann. § 35-15-1005, the Uniform Trust Code,
is misplaced. The Uniform Trust Code applies to “express trusts, charitable or
noncharitable, and trusts created pursuant to a statute, judgment, or decree that requires
the trust to be administered in the manner of an express trust.” Tenn. Code Ann. § 35-15-
102. Plaintiffs rely on the equitable remedy of constructive and resulting trust. Plaintiffs’
complaint is devoid of any reference to an express trust or a trust created pursuant to a
- 10 -
statute, judgment, or decree. Therefore, Tenn. Code Ann. § 35-15-1005(a)-(b) is
inapplicable to the equitable remedies of constructive or resulting trust.
Therefore, the trial court did not err in granting Defendants’ motion to dismiss
Plaintiffs’ complaint.
IV. RESULTING TRUST
Plaintiffs contend they asserted a viable claim for a resulting trust. Defendants
insist the complaint fails to state facts sufficient to state such a claim. We have
determined that Defendants are correct.
[A] resulting trust arises from the nature of circumstances of consideration
involved in a transaction whereby one person thereby becomes invested
with a legal title but is obligated in equity to hold his legal title for the
benefit of another, the intention of the former to hold in trust for the latter
being implied or presumed as a matter of law, although no intention to
create or hold in trust has been manifested, expressly or by inference, and
although there is an absence of fraud or constructive fraud.
Myers v. Myers, 891 S.W.2d 216, 219 (Tenn. Ct. App. 1994) (internal quotations and
citations omitted).
Having read all of the facts alleged in the Complaint, the Amended Complaint and
the Second Amended Complaint, and having assumed them to be true and construing the
factual allegations in favor of Plaintiffs, we have determined that the factual allegations
fail to state a claim based on a resulting trust. Simply stated, the facts Plaintiffs provided
in their complaints fail to state a claim for a resulting trust. See Tenn. R. Civ. P. 8.05.
Therefore, Plaintiffs did not state a claim for a resulting trust upon which relief may be
granted, the statute of limitations issue notwithstanding.
V. THE RESPECTIVE STATUTES OF LIMITATIONS
We shall now address the applicable statute of limitations for each of Plaintiffs’
remaining claims; that of fraud, conspiracy, and constructive trust. Based on the
undisputed facts, this action was commenced in 2016, and the statute of limitations
started to run in 2007 for each of Plaintiff Findley’s claims and in 2010 for each of
Plaintiff Hubbard’s claims.
A constructive trust is an equitable device used by the courts to avoid an unjust
result. Story v. Lanier, 166 S.W.3d 167, 184 (Tenn. Ct. App. 2004). If a trial court has
determined that a constructive trust should be imposed, the court, in equity, removes the
property from the person holding title, the trustee, and puts the property in trust for the
- 11 -
benefit of the person harmed, the beneficiary. Tanner v. Tanner, 698 S.W.2d 342, 346-47
(Tenn. 1985); Browder v. Hite, 602 S.W.2d 489, 492-93 (Tenn. Ct. App. 1980). In
Tennessee, there are four instances in which the courts have instituted a constructive
trust, which include
(1) where a person procures the legal title to property in violation of some
duty, express or implied, to the true owner; (2) where the title to property is
obtained by fraud, duress or other inequitable means; (3) where a person
makes use of some relation of influence or confidence to obtain the legal
title upon more advantageous terms than could otherwise have been
obtained; and (4) where a person acquires property with notice that another
is entitled to its benefits.
Myers v. Myers, 891 S.W.2d 216, 219 (Tenn. Ct. App. 1994) (internal citations omitted).
In determining the statute of limitations, a court is to look at the gravamen of each
claim. McFarland v. Pemberton, 530 S.W.3d 76, 109 (Tenn. 2017). “To determine the
gravamen of a claim . . . ‘a court must first consider the legal basis of the claim and then
consider the type of injuries for which damages are sought.’” Id. (quoting Benz-Elliot v.
Barrett Enters., L.P., 456 S.W.3d 140, 151 (Tenn. 2015)).
The statute of limitations for fraud in Tennessee is three years. Fortune v. Unum
Life Ins. Co. of America, 360 S.W.3d 390, 401 (Tenn. Ct. App. 2010) (citing Tenn. Code
Ann. § 28-3-105(1)). This action was not commenced until 2016; therefore, the three year
statute of limitations for fraud has expired. This is true even if we take the latest date,
2010, which Plaintiffs’ complaint provides as the start date of the statute of limitations
for Plaintiff Hubbard.
A civil conspiracy “is neither a punishable offense standing alone nor a wrong
capable of supporting a cause of action by its own weight.” Swafford v. Memphis
Individual Practice Ass’n, No. 02A01-9612-CV-00311, 1998 WL 281935 at * 11 (Tenn.
Ct. App. June 2, 1998) (citing Wyatt v. Union Mortgage Co., 24 Cal. 3d 773, 157 Cal.
Rptr. 392, 598 P.2d 45, 53 (Cal. 1979)). Therefore, the statute of limitations for
conspiracy claims depends on the gravamen of the claim. Id.; McFarland, 530 S.W.3d at
109 (Tenn. 2017). Plaintiffs’ Amended Complaint states that “the parties conspired
and/or agreed . . . to improperly deprive the Plaintiffs’ of their share of a lottery
winning.” It appears that the gravamen of Plaintiffs’ claim would sound in a claim of
fraud. As stated above, the statute of limitations for fraud is three years. See Fortune, 360
S.W.3d at 401 (Tenn. Ct. App. 2010) (citing Tenn. Code Ann. § 28-3-105(1)). Therefore,
the statute of limitations for the claim of conspiracy has also expired.
In reviewing the gravamen of the claim for breach of fiduciary duty, our courts
have found instances in which a one year statute of limitations can apply and instances in
- 12 -
which a three year statute of limitations can apply. See Mike v. Po. Group, Inc., 937
S.W.2d 790, 793-95 (Tenn. 1996). Under either limitations period, Plaintiffs’ claim has
expired.
Lastly, the statute of limitations for a breach of contract claim is six years. Tenn.
Code Ann. § 28-3-109. Therefore, this limitations period has also expired.
IN CONCLUSION
The judgment of the trial court is affirmed, and this matter is remanded with costs
of appeal assessed against Plaintiffs Angelina Rae Hubbard Findley and Stacey Lynnette
Hubbard.
________________________________
FRANK G. CLEMENT JR., P.J., M.S.
- 13 -