Lanier Trucking v. Long

NOT DESIGNATED FOR PUBLICATION
No. 120,061
IN THE COURT OF APPEALS OF THE STATE OF KANSAS
LANIER TRUCKING, INC., STEVEN LANIER,
Appellants,
v.
JAMES J. LONG,
Appellee.
MEMORANDUM OPINION
Appeal from Sedgwick District Court; WILLIAM S. WOOLLEY, judge. Opinion filed August 14,
2020. Affirmed.
Brian C. Wright, of Wright Law Office, Chartered, of Great Bend, for appellants.
Michelle Moe Witte, of Martin, Pringle, Oliver, Wallace & Bauer, L.L.P., of Wichita, for
appellee.
Before MALONE, P.J., MCANANY, S.J., and BURGESS, S.J.
PER CURIAM: James J. Long provided legal representation for Lanier Trucking,
Inc. (LTI), a company in which Steven Lanier was 50 percent owner. Through
transactions that involved Elvis Lundquist, who owned the other 50 percent of LTI, Long
acquired ownership interest in companies that potentially had interests adverse to LTI.
Lanier and LTI sued Long for legal malpractice and breach of fiduciary duty, but the
district court dismissed the case for lack of prosecution. After Lanier and LTI refiled the
suit, the district court granted three motions for summary judgment in Long's favor.
Lanier and LTI appeal those rulings, arguing that the district court misapplied statutes of
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limitations, Kansas' savings statute, and the standard for deciding a motion for summary
judgment. Finding no error, we affirm the district court's judgment.
FACTUAL AND PROCEDURAL BACKGROUND
Lanier and Lindquist each own 50 percent of LTI. Lindquist also owned a
company called Elite Transportation (Elite) and in 2012, at Lindquist's request, Long
formed another company called Elite Dedicated Services, LLC (EDS). Long had an
ownership share in EDS and was paid to manage EDS, but he did not provide EDS with
legal representation. Also in 2012, Lanier and Lindquist agreed to move some of LTI's
customers to Elite. Under this agreement, LTI and Elite shared some expenses, such as
labor and fuel, but held separate bank accounts.
In January 2013, Long was attorney of record for LTI in a lawsuit brought against
RESS Properties, LLC (RESS), referred to as the RESS lawsuit. At the time, Lanier and
Lindquist each owned one-third of RESS; Sunflower Investments, LLC (Sunflower)
owned 30 and one-third percent of RESS; and Randy Burris owned 3 percent of RESS. In
August 2013, Lindquist, who was LTI's point of contact with Long, directed Long not to
pursue the RESS lawsuit; a settlement agreement was pending.
In September 2013, before a settlement agreement was executed, Lindquist asked
Long if he was interested in acquiring an interest in RESS; Long said he might be. Lanier
later executed an assignment of interest that purported to transfer LTI's interest in RESS
to Lindquist, even though LTI had no interest in RESS to transfer. Despite the wording of
the assignment, Lindquist said he would transfer Lanier's interest in RESS to Long.
On October 1, 2013, representatives of LTI and RESS—including Lanier—signed
a settlement agreement abandoning LTI's claims against RESS. Also under that
settlement agreement, Sunflower transferred its interest in RESS to EDS. Burris sold his
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interest in RESS to Lindquist, and Lindquist transferred a 40 percent interest in RESS to
Long. So as of January 2014, Long and Lindquist were the sole owners of RESS. On
February 19, 2014, the district court dismissed the RESS lawsuit for lack of prosecution.
Long continued to provide legal representation for LTI through at least January
2015, representing LTI in at least two cases that went to trial. Also through 2015, Long
continued working with EDS and he oversaw Elite's accounting and bookkeeping. At
least once, Long authorized payment of revenue generated by LTI into a bank account
held by EDS. Along with LTI revenue, some revenue generated by Elite was deposited
into EDS's account. In July 2014, Lanier wrote to the Kansas Disciplinary
Administrator's Office and informed them that he believed Long was improperly
funneling payments into EDS's bank account. Also in 2014, Lanier agreed to move LTI's
remaining customers to Elite; LTI ceased operation in August 2015.
On February 19, 2016, Lanier and LTI sued Long, alleging legal malpractice
related to Long's actions in the RESS lawsuit and breach of a fiduciary duty Long owed
to both Lanier and LTI. To the extent that the specific claims raised in this lawsuit,
referred to as Lanier I, are relevant to this appeal, they are detailed in the analysis below.
On November 15, 2016, the district court dismissed Lanier I for lack of prosecution.
On March 16, 2017, Lanier and LTI refiled the lawsuit, referred to as Lanier II.
Generally, Lanier and LTI's claims in Lanier II were of legal malpractice and breach of
fiduciary duty arising from two categories of circumstances—those related to Long's
action or inaction involving RESS and those unrelated to RESS.
On August 1, 2017, Long filed a motion for partial summary judgment arguing
that LTI's RESS-related claims of legal malpractice and breach of fiduciary duty were
barred by the applicable two-year statute of limitations in K.S.A. 60-513(a)(4). Long
contended that LTI's RESS-related claims accrued on October 1, 2013, when the parties
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signed the settlement agreement to resolve the RESS lawsuit, so the statute of limitations
expired October 1, 2015, over four months before Lanier I and over two years before
Lanier II. Lanier and LTI disagreed, contending that the continuing representation rule
tolled the statute of limitations.
On September 13, 2017, Long filed a "Second Amended Motion for Partial
Summary Judgment and for the Dismissal of Steven Lanier as a Party Plaintiff." Long
argued that Lanier's personal claims for legal malpractice and breach of fiduciary duty
were barred by the two-year statute of limitations and that Lanier lacked standing to bring
an individual action for harm LTI suffered. Lanier responded to this motion, arguing that
summary judgment would be improper because material facts remained controverted.
The district court held a hearing on October 26, 2017, at which it addressed Long's
second amended motion for partial summary judgment. After hearing argument, the
district court ruled from the bench that there was no attorney/client relationship between
Long and Lanier, so Lanier could not pursue a legal malpractice claim. Thus, the district
court granted summary judgment in Long's favor and dismissed all of Lanier's legal
malpractice claims, whether they stemmed from RESS-related or non-RESS-related facts.
As for Lanier's breach of fiduciary duty claims, the district court found that Lanier
had "not come forward with facts sufficient to create a question of fact that Long owed a
fiduciary duty to Steve Lanier over the RES[S] transaction." The district court granted
summary judgment in Long's favor on Lanier's RESS-related breach of fiduciary duty
claim. But to the extent that Lanier brought claims for a non-RESS-related breach of
fiduciary duty, the district court denied summary judgment as premature and did not
decide whether Long had a non-RESS-related fiduciary duty to Lanier. The district court
later issued a minute order incorporating by reference the reasons articulated at the
October 26, 2017 hearing.
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In November or December 2017, the district court held a hearing on Long's
August 2017 motion for partial summary judgment, but the record on appeal contains no
transcript of that hearing. In any event, on January 16, 2018, the district court issued its
written memorandum and order on Long's first motion for partial summary judgment,
which sought summary judgment on LTI's claims and a ruling that Lanier lacked
authority to bring claims on LTI's behalf. The district court found that Lanier could bring
Lanier II on behalf of LTI. Next, the district court found that the statute of limitations for
LTI's RESS-related claims against Long began to run on October 1, 2013, at the latest, so
the statute of limitations barred those claims. But the district court found that to the extent
that LTI's claims were unrelated to RESS, summary judgment was premature as
discovery was still ongoing. Thus, the district court granted partial summary judgment in
Long's favor "on LTI's claims for malpractice and breach of fiduciary duty but only on
the claims arising out of the RESS litigation and the acquisition of the interest in RESS."
On April 23, 2018, Long filed a motion for summary judgment on LTI's breach of
fiduciary duty claim. Long again argued that the statute of limitations barred this claim,
which stemmed from allegations about the formation of EDS and funds that should have
been paid to LTI being directed to EDS. It appears the district court held a hearing on the
motion on August 2, 2018, but the record on appeal contains no transcript.
On August 7, 2018, the district court issued its written order on the motion,
granting summary judgment in Long's favor on LTI's non-RESS-related breach of
fiduciary claim as barred by the statute of limitations. The district court rejected LTI's
argument that the Kansas savings statute applied to save Lanier II, and it rejected LTI's
argument that the later asserted breaches began the statute of limitations period anew.
On September 6, 2018, Lanier and LTI filed a notice of appeal from the three
partial summary judgment rulings described above. On June 30, 2020, this court issued a
show-cause order noting that the record does not contain final judgment on all the claims
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against Long, nor does it reflect that LTI and Lanier sought to take an interlocutory
appeal. The parties responded to the show-cause order and agreed at oral argument that
the district court's findings on the rulings granting partial summary judgment necessarily
resolved any remaining claims. We retain jurisdiction over this appeal on that basis.
Did the district court err by finding that Long was entitled to summary judgment because
Lanier had failed to sufficiently show that Long owed him a fiduciary duty?
Lanier first argues that the district court erred by granting summary judgment in
Long's favor on Lanier's RESS-related breach of fiduciary duty claims. Lanier contends,
contrary to the district court's holding, that he presented sufficient facts to the district
court to adequately dispute Long's assertion that he owed Lanier no fiduciary duty during
the RESS transactions. Lanier also asserts that he presented evidence that Long breached
that fiduciary duty. Thus, he asks this court to reverse the order of summary judgment
and remand for further proceedings.
Long argues that he owed no fiduciary duty to Lanier individually and that the
district court correctly granted partial summary judgment in Long's favor on those claims.
Long also contends that, even if the district court erred in finding he owed Lanier no
fiduciary duty, the applicable statute of limitations barred Lanier's individual breach of
fiduciary duty claims.
"We review a district court's grant of summary judgment de novo and read the
record under the same rules applicable to the district court.
"'"'Summary judgment is appropriate when the pleadings, depositions, answers to
interrogatories, and admissions on file, together with the affidavits, show that there is no
genuine issue as to any material fact and that the moving party is entitled to judgment as
a matter of law. The trial court is required to resolve all facts and inferences which may
reasonably be drawn from the evidence in favor of the party against whom the ruling is
sought. When opposing a motion for summary judgment, an adverse party must come
forward with evidence to establish a dispute as to a material fact. In order to preclude
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summary judgment, the facts subject to the dispute must be material to the conclusive
issues in the case. On appeal, we apply the same rules and where we find reasonable
minds could differ as to the conclusions drawn from the evidence, summary judgment
must be denied.'"' [Citations omitted.]" Hill v. State, 310 Kan. 490, 512-13, 448 P.3d 457
(2019).
Here, the district court found that the existence of a fiduciary duty is generally a
question of fact. The district judge also found:
"When faced with a Motion for Summary Judgment on plaintiff's claims as I said
before the plaintiff cannot just stand pat and say we deny it or controvert. You must come
forward with facts sufficient to withstand summary judgment. That would be both on the
existence of a fiduciary duty and the dates of the fact of injury.
"As I mentioned before with the full RES[S] transaction Steve Lanier has not
come forward with facts sufficient to create a question of fact that Long owed a fiduciary
duty to Steve Lanier over the RES[S] transaction."
In general, Kansas courts recognize two types of fiduciary relationships: those
created by contract and those implied in law because of the circumstances of the parties'
relationships and the transactions involved. Rail Logistics, L.C. v. Cold Train, L.L.C., 54
Kan. App. 2d 98, 115, 397 P.3d 1213 (2017) (quoting Denison State Bank v. Madeira,
230 Kan. 684, 691, 640 P.2d 1235 [1982]). Lanier does not contend that a contract
created Long's fiduciary duty to him, so any such duty must be implied by law. As Lanier
notes, certain circumstances may show a fiduciary relationship:
"[T]he acting of one person for another; the having and the exercising of influence over
one person by another; the reposing of confidence by one person in another; the
dominance of one person by another; the inequality of the parties; and the dependence of
one person upon another. In addition, courts have considered weakness of age, mental
strength, business intelligence, knowledge of the facts involved or other conditions giving
to one an advantage over the other." First Bank of Wakeeney v. Moden, 235 Kan. 260,
262, 681 P.2d 11 (1984).
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Lanier offers the following—without citation to the record—as evidence that Long
owed him a fiduciary duty:
• Because he legally represented LTI, was involved in accounting and
bookkeeping for LTI, and worked for Elite, Long "was in a position of
superior knowledge and understanding compared to Lanier."
• Lanier "understood that Long was acting in his interest . . . due to Long's
long-standing representation of LTI for several years."
• Lanier placed special confidence in Long to safeguard LTI's interests,
which left Long "bound to act in good faith and with due regard to the
interest of Steve Lanier."
• Based on Long's relationship with LTI, a corporation "Lanier had founded
and [which] provided Lanier with his living," Lanier reasonably expected
"to be treated fairly" by Long in his personal dealings.
After making these assertions, Lanier focuses his argument on whether Long
breached his fiduciary duty to Lanier, citing various provisions of the Kansas Rules for
Professional Conduct with which he argues Long did not comply. But even if Lanier
presented the district court with evidence to support all of these factual assertions—which
largely boil down to Lanier believing that Long owed him a fiduciary duty because Long
represented LTI and was better versed in the law than Lanier—this is not sufficient to
dispute Long's assertion that no fiduciary relationship existed. Put simply, Lanier
provided only evidence that he believed Long owed him a duty.
In Dana v. Heartland Mgmt. Co., 48 Kan. App. 2d 1048, 1066, 310 P.3d 772
(2013), this court reviewed a district court's summary judgment in the defendants' favor
on a breach of fiduciary duty claim. The plaintiffs argued to this court that the district
court erred in granting summary judgment because they had presented evidence that "a
fiduciary relationship existed between the parties due to the trust and confidence they
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placed in the defendants." 48 Kan. App. 2d at 1066. In rejecting the argument, this court
noted that courts do not presume a fiduciary relationship exists, and "[a] party may not
'unilaterally impose a fiduciary relationship on another without a conscious assumption of
such duties by the one sought to be held liable as a fiduciary.'" 48 Kan. App. 2d at 1067.
Likewise, Lanier cannot unilaterally impose on Long a fiduciary relationship and
the accompanying duties owed; Long must have consciously assumed such duties. Lanier
provided no evidence that Long did so, and a review of the record reveals no evidence
that could create a dispute about whether Long and Lanier had a fiduciary relationship
that gave rise to Long owing Lanier a fiduciary duty. Moreover, the evidence Lanier
offers of a fiduciary relationship stems from Long's status as legal counsel for LTI. This
court has recognized that "as a general legal principle, attorneys representing
corporations owe no duty to third-party shareholders." Miller v. Staab, No. 91,931, 2005
WL 1429834, at *4 (Kan. App. 2005) (unpublished opinion); see also White v. Barbieri,
No. 106,078, 2012 WL 3966527, at *4 (Kan. App. 2012) (unpublished opinion) (citing
Miller).
Thus, the district court properly found that Lanier failed to come forward with
evidence that Long consciously assumed any fiduciary duties to Lanier, so the district
court did not err in granting summary judgment to Long on this claim. We need not
address Long's alternative argument that any breach of fiduciary duty claim by Lanier
against Long is barred by the applicable statute of limitations.
Did the district court err by finding that LTI's RESS-related claims were barred by the
statute of limitations?
LTI argues that the district court erred by granting summary judgment after
finding that the applicable statute of limitations barred its RESS-related claims against
Long. The "continuous representation rule" provides that in some cases, a claim based on
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the breach of a duty an attorney legally owed his or her client "'does not accrue until the
attorney-client relationship is terminated.'" Mashaney v. Board of Indigents' Defense
Services, 302 Kan. 625, 631, 355 P.3d 667 (2015). LTI claims that the continuous
representation rule tolls the statute of limitations for both its legal malpractice and
fiduciary duty claims against Long so that the two-year period did not begin to run until
at least February 2015. Long disagrees, arguing that the district court correctly found that
LTI's RESS-related claims were barred by the statute of limitations.
We have set forth our standard of review when the district court grants summary
judgment. See Hill, 310 Kan. at 512-13. "Likewise, the 'interpretation and application of
a statute of limitations is a question of law over which an appellate court exercises
unlimited review.'" Garcia v. Ball, 303 Kan. 560, 571, 363 P.3d 399 (2015). And whether
the continuous representation rule applies to toll a statute of limitations "depends upon
the facts and circumstances of each case." Mashaney, 302 Kan. at 631.
In district court, LTI argued that even if the statute of limitations for its RESS-
related claims began running on October 1, 2013, with the signing of the settlement
agreement for the RESS lawsuit, Long's continuing representation of LTI tolled that
statute of limitations. In support, LTI pointed out Long's 2013 through 2015
representation of LTI in a lawsuit with the Butler Group. But Long successfully argued to
the district court that the continuous representation rule is matter-specific, so it does not
apply to preserve LTI's RESS-related claims because Long's RESS-related representation
of LTI ended in 2013, even though Long continued to represent LTI in other matters.
LTI does not acknowledge on appeal that the district court relied on the matter-
specific nature of the continuous representation rule, nor does LTI argue on appeal that
the district court erred in holding that the continuous representation rule is matter-
specific. LTI also does not argue that if the continuous representation rule does not apply,
there is some other way to preserve its RESS-related claims against Long. Rather, LTI
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contends generally that the continuous representation rule saves its claims and that the
district court was "unnecessarily concerned" about the effect of the continuous
representation rule on large law firms and corporations.
Because LTI does not argue that the district court erred by holding that the
continuous representation rule is matter-specific—the holding on which the district
court's granting summary judgment on this issue hinged—LTI has waived any such
argument. See Lambert v. Peterson, 309 Kan. 594, 598, 439 P.3d 317 (2019) ("Because
of [the appellant's] failure to brief or assert any of these arguments before us, she has
waived or abandoned them."). For this reason alone, LTI's claim that Long's continuous
representation preserved its legal malpractice and breach of fiduciary duty claims fails.
Even so, we will address LTI's argument in its brief that we should reverse the
district court's judgment on this issue based on this court's recognition of the continuous
representation rule in Morrison v. Watkins, 20 Kan. App. 2d 411, 889 P.2d 140 (1995). In
that case, Dorothy M. Morrison, with help from attorney L. Earl Watkins, Jr., established
the Dorothy M. Morrison Revocable Trust No. 1 (Trust) in 1979. Watkins and James
Adams, a C.P.A., were co-trustees of the Trust along with Morrison. The Trust
authorized any two of the three trustees to act for the Trust. Between 1979 and 1986, the
Trust made several unfortunate investments. Watkins and Adams stated that Morrison
received and reviewed financial statements for the Trust every six months and was aware
of almost all the investments before or soon after they occurred, but Morrison claimed
that she did not understand the financial statements and did not learn about the
investments until later.
In 1986, Morrison hired another attorney, Henry McFadyen, who recommended
that Morrison discharge Watkins and Adams as trustees, but she at first did not want to
do so. Later, Morrison replaced Adams as co-trustee with her son, and she directed the
trustees to sell certain investments and invest in different opportunities. Watkins
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continued as a trustee and, in 1990, Morrison terminated her attorney-client relationship
with McFadyen, "indicating that she was satisfied with the management of the Trust." 20
Kan. App. 2d at 415. In June of that year, Morrison terminated the Trust.
On October 18, 1991, Morrison sued Watkins and Adams, alleging that they had
breached their fiduciary duties owed to her. The district court granted summary judgment
for the defendants, finding in part that Morrison's claims against Watkins were barred by
the statute of limitations. 20 Kan. App. 2d at 416.
On appeal, Morrison argued that the continuous representation rule tolled the
statute of limitations on her claims until she revoked the Trust, thereby dismissing
Watkins as a trustee. This court noted that although Morrison's case did not fit neatly
within the framework of the continuous representation rule, other jurisdictions had
applied the rule to claims against an attorney acting as a trustee. 20 Kan. App. 2d at 418.
This court reasoned that "it would be irrational to require Morrison to file suit against the
trustees for every investment as soon as she learned about it. Instead, Morrison should
rightly be able to work with the other trustees in an attempt to recoup her losses and set
straight the trust management." 20 Kan. App. 2d at 418.
Because Watkins was trustee and attorney for Morrison and the Trust until 1990,
this court held that the statute of limitations did not bar her claims. 20 Kan. App. 2d at
418. This court also held that the district court erred in finding that Morrison hiring
McFadyen interrupted the continuous representation when McFadyen advised her to fire
Watkins and Adams because Morrison did not take that advice and decided to work with
Watkins and Adams to rehabilitate the Trust. 20 Kan. App. 2d at 421.
LTI analogizes its circumstances to those in Morrison, first for the proposition that
the continuous representation rule applies even outside the attorney-client relationship.
LTI also argues that if Morrison's retention of another attorney who advised her to fire
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Watkins did not interrupt the application of the continuous representation rule, neither
should LTI's "knowledge or reason to know" about the actions that led to its claims in this
case. LTI argues that its "level of concern" did not reach the level that Morrison
presumably had upon being told to fire Watkins until July 2014, when Lanier complained
to the disciplinary administrator about Long's behavior.
LTI misconstrues and misapplies Morrison and its holdings, and the facts in that
case are materially distinguishable from the facts here. First, in Morrison, Watkin's
fiduciary relationship with Morrison involved the same subject matter throughout the
relationship—specifically, investments made by the Trust. Thus, in Morrison, the
subject-matter limitation of the continuous representation rule was not implicated. But
even the Morrison court noted: "'Where the attorney continues to represent the client in
the subject matter in which the error has occurred, all such objectives [of the continuous
representation rule] are achieved and preserved.'" (Emphasis added.) 20 Kan. App. 2d at
417. Here, although Long continued to represent LTI in other cases, it is undisputed that
his representation in the RESS lawsuit ended on October 1, 2013.
Second, contrary to LTI's implied assertion in its brief, the question before the
Morrison court was not the timing of Morrison's "level of concern." Rather, the question
before the Morrison court was "whether Morrison's hiring of McFadyen in 1987
interrupted the continuous representation rule." 20 Kan. App. 2d at 418. Comparing the
timing of LTI's "level of concern" as shown by Lanier's complaint to the disciplinary
administrator's office to Morrison's hiring of McFadyen and consulting with him about
the trustees' actions is not an apt comparison. Thus, even setting aside the subject-matter
limitation of the continuous representation rule, LTI's assertion that Morrison requires
this court to rule in its favor is unpersuasive. LTI fails to show that the district court erred
by finding that its RESS-related claims were barred by the statute of limitations.
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Did the district court err by finding that the savings statute did not apply to LTI's non-
RESS-related breach of fiduciary duty claims?
K.S.A. 60-518, also known as Kansas' "savings statute," states: "If any action be
commenced within due time, and the plaintiff fail in such action otherwise than upon the
merits, and the time limited for the same shall have expired, the plaintiff . . . may
commence a new action within six (6) months after such failure." LTI and Lanier filed
Lanier I on February 19, 2016, and it was dismissed for lack of prosecution on November
15, 2016. LTI and Lanier filed Lanier II on March 16, 2017.
The parties and the district court differently approached the analysis of the statute
of limitations for non-RESS-related breach of fiduciary duty claims, so understanding the
framing of the issue helps to understand the appellate arguments. The district court
determined when a breach of fiduciary duty could have occurred and been timely pled in
Lanier II. Long argued to the district court that Lanier II could only contain claims that
accrued on or after March 16, 2015—two years before the filing of Lanier II. LTI, on the
other hand, argued that Lanier II could contain claims that accrued on or after February
19, 2014—two years before it filed Lanier I—because the savings statute applied to allow
Lanier II to raise claims timely raised in Lanier I.
The district court first determined that the savings statute did not apply because
the claims in Lanier I and Lanier II were not substantially similar, so Lanier II could
plead non-RESS-related breach of fiduciary duty claims only if the claims arose on or
after March 16, 2015. Next, the district court turned to whether the non-RESS-related
fiduciary duty claims pled in Lanier II fit within that timeframe, and it found that the
facts giving rise to those claims were reasonably ascertainable to LTI by July 21, 2014—
the date of a letter Lanier wrote to the Disciplinary Administrator's Office complaining
about Long's involvement with Elite, EDS, and RESS. The district court also found that
the facts before it showed that "Long's actions concerning EDS and the alleged injury to
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LTI were known or reasonably known to Lanier in 2013" and because Lanier was a co-
owner and co-manager of LTI, his knowledge is attributable to LTI. Thus, the district
court concluded, "both Long's actions and the alleged injury to LTI were known or
reasonably known to Lanier in 2013, more than two years before Lanier I and Lanier II
were filed. Long's breaches of fiduciary duty were ascertainable in 2013."
On appeal, LTI argues only that the district court erred when it found that the non-
RESS-related breach of fiduciary duty claims in Lanier II are not substantially similar to
the breach of fiduciary claims pled in Lanier I. LTI contends that the breach of fiduciary
duty claims in both lawsuits were substantially similar, so the savings statute applied to
allow the Lanier II claims. Long disagrees, arguing that the similarity is irrelevant since
the district court found that LTI's non-RESS-related breach of fiduciary duty claims arose
more than two years before Lanier I, so they were barred in Lanier I and the savings
statute does not apply to allow them to be refiled in Lanier II.
LTI does not directly challenge the district court's finding that all of Long's alleged
breaches of fiduciary duty were reasonably ascertainable more than two years before
Lanier I. As such, Long is correct—whether the district court erred in finding that the
savings statute did not apply because the claims in Lanier I and Lanier II were not
substantially similar is irrelevant. The savings statute would not apply here even if the
claims in the two lawsuits were substantially similar since Lanier I was not timely
commenced as to LTI's non-RESS-related breach of fiduciary duty claims. See K.S.A.
60-518 (the first lawsuit must be "commenced within due time"). As a result, LTI has not
shown that it is entitled to any relief under the savings statute.
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Did the district court err by failing to consider whether each alleged non-RESS-related
breach of fiduciary duty began a new statute of limitations period?
LTI contends that the district court erroneously found that once LTI was aware of
Long's wrongdoing in 2013, the statute of limitations began to run on Long's breaches of
fiduciary duty, even those that occurred later. LTI argues that Long was engaged in a
continuing tort and that his breach of fiduciary duty "continued for years, as
EDS/Long/Lindquist/Elite failed to remit or account for LTI revenue or expense." LTI
argues that the district court should have considered whether the statute of limitations had
expired for each alleged breach of fiduciary duty, including those in 2014, 2015, and
2016. LTI asserts that "past knowledge cannot bar the right of LTI to assert damages for
losses that occurred as part of the ongoing scheme to deprive LTI of revenue, income and
assets" because "every tort or breach of duty is its own cause of action."
As Long points out, LTI provides no legal authority to support its argument. The
district court had also noted that LTI did not cite any legal authority to support this
argument. The only two cases LTI cites on this issue in its appellate brief are the cases
cited for the standard of review for summary judgment and Dreiling v. Davis, 38 Kan.
App. 2d 997, 176 P.3d 197 (2008), which is cited for the broad proposition that a statute
of limitations defense is barred when the defendant was involved in activities designed to
obscure the fact of injury. Dreiling concerned a wrongful death action, which the Kansas
Supreme Court has held accrues when the fact of death becomes reasonably ascertainable
"'unless the information from which the fact of death or negligence can be determined
was either concealed, altered, falsified, inaccurate, or misrepresented.'" 38 Kan. App. 2d
at 1002. LTI does not identify how Long tried to mislead or misdirect it with respect to
breaches of fiduciary duty, nor does LTI otherwise argue Dreiling's applicability.
LTI has also provided no citations to the record on this issue. For example, it does
not cite the place in the record where the district court ruled on this argument. And
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although it makes general statements such as "LTI asserted controverted material facts to
show that [Long's] bad acts continued into 2014 and 2015," LTI does not tell this court
where in the appellate record it may find those assertions or evidence to support them as
would render the timing of Long's bad acts controverted material facts.
Supreme Court Rule 6.02(a)(5) (2020 Kan. S. Ct. R. 35) requires that each issue in
an appellant's brief contain "[t]he arguments and authorities relied on" and "must begin
with citation to the appropriate standard of appellate review and a pinpoint reference to
the location in the record on appeal where the issue was raised and ruled on." LTI has not
complied with this rule and it does not explain why this court should apply Dreiling.
"'Simply pressing a point without pertinent authority, or without showing why it is sound
despite a lack of supporting authority, is akin to failing to brief an issue.'" In re T.S., 308
Kan. 306, 312-13, 419 P.3d 1159 (2018). Thus, LTI has not adequately briefed this issue
and we consider the issue waived and abandoned.
As a final matter, Long points out the undisputed fact that Lanier agreed to move
LTI's remaining customers to Elite in 2014, more than two years before Lanier II was
filed. After that time, LTI had no original source of revenue and there was nothing to
remit or account. So even if we reached LTI's substantive claim on this issue, it appears
that LTI would suffer from the statute of limitations problems it has with its other claims.
Affirmed.
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