law-accrual-date | summary judgment based on limitations | statute of limitations | discovery rule | fraudulent
concealment as tolling theory |
Accrual of a cause of action is deferred in two types of situations, neither of which is present in this case.
In one type, those involving allegations of fraud or fraudulent concealment, accrual is deferred because a
person cannot be permitted to avoid liability for his actions by deceitfully concealing wrongdoing until
limitations has run. The other type, in which the discovery rule applies, comprises those cases in which
the nature of the injury incurred is inherently undiscoverable and the evidence of injury is objectively
verifiable.' S.V. v. R.V., 933 S.W.2d 1, 6 (Tex.1996) (quoting Computer Associates International, Inc. v.
Altai, Inc., 918 S.W.2d 453, 456 (Tex.1996)).
LIMITATIONS CASE LAW: ACCRUAL DATE OF CLAIM
Breach of Employment Contract: What does the claim accrue?
An employee under a term contract who is terminated before the end of the contract is entitled to damages and
not wages. The breach arises when he is terminated, and a cause of action immediately accrues. Dixie Glass
Co. v. Pollack, 341 S.W. 2d 530, 538–540 (Tex. Civ. App.—Houston 1960), writ ref’d per curiam, 347 S.W. 2d 596
Malallah v. Noble Logistic Services, Inc. (Tex.App. - Houston [14th Dist.] Feb. 2, 2010)(Christopher)
(employment law, employment contract, statute of limitations, accrual of claim for SOL purposes)
AFFIRMED: Opinion by Justice Christopher
Before Chief Justice Hedges, Justices Anderson and Christopher
14-08-01030-CV Bader Malallah v. Noble Logistic Services, Inc. f/k/a Dedicated Services, Inc.
and SRS Texas Holdings, LLC
Appeal from 55th District Court of Harris County
Trial Court Judge: Jeff Shadwick
When Did Causes of Action Accrue Against Insurer Accrue?
Determining when a cause of action accrues typically is a question of law. Provident Life & Accident Ins. Co. v.
Knott, 128 S.W.3d 211, 221 (Tex. 2003). “As a general rule, a cause of action accrues and the statute of
limitations begins to run when facts come into existence that authorize a party to seek a judicial remedy." Id.
(citing Johnson & Higgins of Tex., Inc. v. Kenneco Energy, Inc., 962 S.W.2d 507, 514 (Tex. 1998), and Murray,
800 S.W.2d at 828). “In most cases, a cause of action accrues when a wrongful act causes a legal injury,
regardless of when the plaintiff learns of that injury or if all resulting damages have yet to occur." Knott, 128 S.W.
3d at 221 (citing S.V. v. R.V., 933 S.W.2d 1, 4 (Tex. 1996)).
Accrual may be deferred if the cause of action (1) is not discovered as a result of fraud or fraudulent
concealment; or (2) is “inherently undiscoverable." Kuzniar v. State Farm Lloyds, 52 S.W.3d 759, 760 (Tex. App.-
San Antonio 2001, pet. denied) (en banc). Sheppard did not plead these bases for deferring accrual of his cause
of actions; did not assert them in his summary judgment response; and does not assert them on appeal.
Therefore, Travelers was not required to negate these bases for deferring accrual in the trial court and they do
not affect the analysis on appeal. See, e.g, Via Net v. TIG Ins. Co., 211 S.W.3d 310, 313 (Tex. 2006).
Sheppard v. Travelers Lloyds of Texas Ins. Co. (Tex.App.- Houston [14th Dist.] Oct. 15, 2009)(Boyce) (summary
judgment for insurer on breach of contract and violations of the Texas Insurance Code claims affirmed)(breach of
contract and statutory insurance code claim denial cause of action time-barred, accrual date, contractual
shortening of limitations period)
AFFIRMED: Opinion by Justice Boyce
Before Justices Anderson and Boyce
14-08-00248-CV Anthony Sheppard v. Travelers Lloyds of Texas Insurance Company
Appeal from 125th District Court of Harris County
Trial Court Judge: John A. Coselli
Accrual and Summary Judgment based on Limitations
A defendant who seeks summary judgment on the basis of limitations must conclusively prove when the plaintiff's
cause of action accrued. See KPMG Peat Marwick v. Harrison County Hous. Fin. Corp., 988 S.W.2d 746, 748
(Tex. 1999). “Accrual” refers to the date when a limitations period begins to run. See XCO Prod. Co. v. Jamison,
194 S.W.3d 622, 634 (Tex. App.- Houston [14th Dist.] 2006, pet. denied). The date that an action accrues is a
question of law. See Moreno v. Sterling Drug, Inc., 787 S.W.2d 348, 351 (Tex. 1990).
Seureau v. Exxon Mobil Corp (Tex.App.- Houston [14th Dist.] Oct. 16, 2008)(Brown)
Because no statute defines the accrual date for the Seureaus' breach-of-contract and fraud claims, we look to the
legal-injury rule to determine the accrual date. See KPMG, 988 S.W.2d at 750; S.V. v. R.V., 933 S.W.2d 1, 4
(Tex. 1996). Under the legal-injury rule, a cause of action generally accrues when a wrongful act causes some
legal injury, regardless of when the plaintiff learns of the injury, and even if all resulting damages have not yet
occurred. S.V., 933 S.W.2d at 4. A legal injury consists of any invasion to the claimant's legally protected
interest. Goggin v. Grimes, 969 S.W.2d 135, 137 (Tex. App.-Houston [14th Dist.] 1998, no pet.). Stated
differently, a cause of action generally accrues when facts come into existence which authorize a claimant to seek
a judicial remedy. Trail Enters., Inc. v. City of Houston, 957 S.W.2d 625, 631 (Tex. App.- Houston [14th Dist.]
1997, pet. denied). When the defendant's conduct produces a legal injury, however slight, the cause of action
accrues and the statute of limitations begins to run. See Childs v. Haussecker, 974 S.W.2d 31, 41 n.7 (Tex.
1998); Goggin, 969 S.W.2d at 137.
Discovery Rule and Fraudulent Concealment
In rare cases where the nature of the injury is inherently undiscoverable and evidence of the injury is objectively
verifiable, courts have recognized the discovery rule as an exception to the general accrual rule. See, e.g.,
Computer Assocs. Int'l, Inc. v. Altai, Inc., 918 S.W.2d 453, 455 (Tex. 1996). The discovery rule is a very limited
exception to limitations and is construed strictly. See id.; S.V., 933 S.W.2d at 25 (noting that applications of
discovery rule “should be few and narrowly drawn"). The rule has been limited to matters that are properly
characterized as inherently undiscoverable. Johnson v. Abbey, 737 S.W.2d 68, 69-70 (Tex. App.-Houston [14th
Dist.] 1987, no writ). An injury is inherently undiscoverable if, by its very nature, it is unlikely to be discovered
within the prescribed limitations period despite the exercise of due diligence. Wagner & Brown, Ltd. v. Horwood,
58 S.W.3d 732, 734-35 (Tex. 2001). Whether an injury is inherently undiscoverable is determined on a
categorical basis, because such an approach “brings predictability and consistency to the jurisprudence." See
Apex Towing Co. v. Tolin, 41 S.W.3d 118, 122 (Tex. 2001). Thus, the focus is on whether a type of injury, rather
than a particular injury, was discoverable. Via Net v. TIG Ins. Co., 211 S.W.3d 310, 314 (Tex. 2006).
Where the discovery rule applies, the cause of action accrues when the plaintiff knows, or through the exercise of
reasonable care and diligence should have discovered, the nature of his injury and the likelihood that it was
caused by the wrongful acts of another. See Childs, 974 S.W.2d at 40. Thus, accrual is not delayed until the
plaintiff learns of actual causes and possible cures for his injuries. PPG Indus., Inc. v. JMB/Houston Ctrs. Partners
Ltd. P'ship, 146 S.W.3d 79, 93 (Tex. 2004). Instead, a plaintiff who invokes the discovery rule still must have
sought information about his injuries and their likely cause once apprised of facts that would prompt a reasonably
diligent person to make an inquiry that would lead to discovery of the cause of action. Pirtle v. Kahn, 177 S.W.3d
567, 571 (Tex. App.- Houston [1st Dist.] 2005, pet. denied).
If, as here, the plaintiff pleads the discovery rule as an exception to limitations, the defendant moving for summary
judgment must negate it. KPMG, 988 S.W.2d at 748. This may be done by demonstrating that the discovery rule
does not apply or by proving, as a matter of law, that there is no genuine issue of material fact as to when the
plaintiff discovered, or in the exercise of reasonable diligence should have discovered, the nature of his injury.
Childs, 974 S.W.2d at 44.
Although similar in effect to the discovery rule, the fraudulent-concealment doctrine is an affirmative defense to
limitations that resembles equitable estoppel. Trousdale v. Henry, 261 S.W.3d 221, 235 (Tex. App.- Houston
[14th Dist.] 2008, rule 53.7(f) motion granted); Autry v. Dearman, 933 S.W.2d 182, 192 (Tex. App.- Houston [14th
Dist.] 1996, writ denied). This doctrine estops a defendant from relying on the defense of limitations if the
defendant was under a duty to make a disclosure but fraudulently concealed the existence of a cause of action
from the party to whom it belongs. Ponder v. Brice & Mankoff, 889 S.W.2d 637, 645 (Tex. App.- Houston [14th
Dist.] 1994, writ denied).
To prove fraudulent concealment, the plaintiff must demonstrate that the defendant had (1) actual knowledge that
a wrong occurred, (2) a duty to disclose the wrong, and (3) a fixed purpose to conceal the wrong. McMahan v.
Greenwood, 108 S.W.3d 467, 493 (Tex. App.- Houston [14th Dist.] 2003, pet. denied). The estoppel effect of
fraudulent concealment ends when a party learns of facts, conditions, or circumstances that would cause a
reasonably prudent person to make inquiry which, if pursued, would lead to the discovery of the concealed cause
of action. Ponder, 889 S.W.2d at 645. This is the same standard that applies to the discovery rule. Trousdale,
261 S.W.3d at 235.
We therefore hold that the estoppel effect of fraudulent concealment, if any, ended many years before the
Seureaus opted to bring suit. See Ponder, 889 S.W.2d at 645. Thus, the doctrine of fraudulent concealment
does not relieve the Seureaus of the time-barring effects of limitations on their fraud and contract-development
TRADITIONAL SUMMARY JUDGMENT BASED ON LIMITATIONS
A defendant moving for summary judgment on the ground of limitations must conclusively establish the elements
of its affirmative defense. KPMG Peat Marwick v. Harrison County Housing Fin. Corp., 988 S.W.2d 746, 748 (Tex.
1999). To satisfy its burden, the defendant must (1) establish conclusively when the claims in question accrued;
and (2) negate the discovery rule if it applies and has been pleaded or otherwise raised, by proving as a matter of
law that there is no genuine issue of material fact about when the claimant discovered, or in the exercise of
reasonable diligence should have discovered, the nature of its injury. Id. Only if the defendant meets this burden
must the claimant adduce summary judgment proof raising a fact issue in avoidance of the limitations defense. Id.
Martinez v. Donisi (Tex.App.- Houston [14th Dist.] July 30, 2009)(Frost)(inheritance dispute, probate law, dispute
re money alleged to have been held in trust for grandchild, claims of alleged violations of the Texas Theft Liability
Act, conversion of money, breach of fiduciary duty, and fraud) (summary judgment based on limitations reversed,
accrual date not proven)(multiple appeals)(summary judgment based on limitations reversed, movant did not
prove accrual date)
REVERSED AND REMANDED: Opinion by Justice Frost
Before Justices Frost, Brown and Boyce
14-08-00166-CV Jaime Martinez v. Philip Donisi, Independent Executor of the Estate of Jackie Marie Gammil
Appeal from Probate Court No 2 of Harris County
Trial Court Judge: Michael James Wood
In her first issue, Jaime argues that Donisi was not entitled to summary judgment on the ground of limitations
because he failed to establish when her claims accrued. Generally, a claim accrues when a wrongful act causes
some legal injury, even if the fact of injury is not discovered until later, and even if all resulting damages have not
yet occurred. See S.V. v. R.V., 933 S.W.2d 1, 4 (Tex. 1996). Where applicable, the discovery rule defers the
accrual of a claim until the claimant knew or, in the exercise of reasonable diligence, should have known of the
facts giving rise to the claim. See Wagner & Brown, Ltd. v. Horwood, 58 S.W.3d 732, 734 (Tex. 2001).
The summary-judgment evidence attached to Donisi's motion does not establish the date on which any of Jaime's
claims accrued. See Anderson v. Cocheu, 176 S.W.3d 685, 690 (Tex. App.- Dallas 2005, pet. denied) (holding
summary judgment was improper because defendant did not conclusively prove by his summary-judgment
evidence when plaintiff's fraud claims accrued); Meru v. Huerta, 136 S.W.3d 383, 388 (Tex. App.- Corpus Christi
2004, no pet.) (holding summary judgment was improper on defense of limitations because movant's evidence did
not conclusively prove when claims accrued). Therefore, the trial court erred in granting Donisi's motion for
summary judgment. Accordingly, we sustain Jaime's first issue
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