Nettles v. American Tel. and Tel. Co.

Decision Date05 June 1995
Docket NumberNo. 94-3337,94-3337
Parties130 Lab.Cas. P 57,915 Linda S. NETTLES, Appellant, v. AMERICAN TELEPHONE AND TELEGRAPH COMPANY, a New York Corporation, Appellee.
CourtU.S. Court of Appeals — Eighth Circuit

Ronald K. Barker, Kansas City, MO, argued, for appellant.

John J. Yates, Kansas City, MO, argued (Janet L. Chleborad, on the brief), for appellee.

Before WOLLMAN, Circuit Judge, FLOYD R. GIBSON, Senior Circuit Judge, and MURPHY, Circuit Judge.

WOLLMAN, Circuit Judge.

Linda S. Nettles brought this action against her former employer, American Telephone and Telegraph Company (AT & T), alleging claims of promissory estoppel and fraudulent misrepresentation. Applying the Missouri borrowing statute, the district court 1 found that Nettles' claims were untimely under the applicable statute of limitations and granted summary judgment in favor of AT & T. We affirm.

I.

Nettles was employed by AT & T in its Maitland, Florida, office from June 1987 to October 1988. In July 1988, AT & T instituted a Strategic Force Redeployment Career Opportunity Program (the "Program"). The stated purpose of the Program was to strengthen the company's sales staff by providing additional training to management level employees and redeploying them in various sales positions throughout the country.

On August 9, 1988, Nettles applied for a position under the Program and requested that she be relocated to one of three offices in California. According to Nettles' complaint, AT & T orally promised her that a position would be available in Oakland, California, for a person with her qualifications. AT & T made certain other representations to Nettles concerning salary and benefits, job duties, training, and performance evaluation, all of which she relied on in seeking relocation. On September 12, 1988, AT & T selected Nettles to participate in the Program and assigned her to its branch office in Oakland. The relocation became effective on October 2, 1988.

Nettles alleges that after relocating to Oakland, she discovered in October 1989 that the representations made by AT & T concerning the Program were false and that AT & T had redeployed far more people to California than there were jobs available. Thus, she claims, the position promised her by AT & T was not available, and she was reassigned to a pool of excess redeployed employees. Nettles alleges that as a result, she was forced to relocate in February 1990 to a lower paid and lower management level position in AT & T's office in Kansas City, Missouri.

Nettles claims that she continued to work in the Kansas City office until she was placed on disability leave in March 1992. She alleges that as a result of her experience with AT & T and the Program, she has suffered damages, including the costs associated with relocating from Florida to California and from California to Missouri. She further alleges that she has suffered, and continues to suffer, from depression and severe emotional distress, resulting in her total employment disability. Beginning in 1992, Nettles received treatment from a psychiatrist and a psychologist, both of whom diagnosed Nettles as being disabled due at least in part to the relocation. Finally, Nettles alleges that AT & T forced her to take disability retirement in March 1993 because her health prohibited her from returning to work on a full-time basis.

In August 1993, Nettles sued AT & T in Missouri state court, asserting claims of promissory estoppel and fraudulent misrepresentation. AT & T removed the case to federal court and promptly moved for summary judgment, claiming that Nettles' complaint was untimely under the applicable statute of limitations. The district court granted the motion. It held that under Mo.Rev.Stat. Sec. 516.190 (1986), Nettles' claims originated in California no later than October 1989, the date on which Nettles discovered the alleged fraud and AT & T's failure to comply with its representations concerning the redeployment. Applying California's three-year statute of limitations, the district court held that Nettles' suit was untimely. This appeal followed.

II.

We review a grant of summary judgment de novo, applying the same standards employed by the district court. Sperry v. Bauermeister, Inc., 4 F.3d 596, 597 (8th Cir.1993); Fed.R.Civ.P. 56(c). We will affirm the grant of summary judgment if the evidence, viewed in the light most favorable to the non-moving party, shows that there is no dispute of material fact and that the moving party is entitled to judgment as a matter of law. McIlheran v. Lincoln National Life Insurance Co., 31 F.3d 709, 710 (8th Cir.1994). Because this is a diversity case, the district court's interpretation of state law is also subject to de novo review. Salve Regina College v. Russell, 499 U.S. 225, 231, 111 S.Ct. 1217, 1221, 113 L.Ed.2d 190 (1991).

Nettles argues that the district court erred in finding that the Missouri borrowing statute operates to require application of California law to determine the timeliness of her claims. She contends that Missouri's five-year statute of limitations for actions based on breach of contract and fraud, Mo.Rev.Stat. Sec. 516.120 (1986), applies in this case and that because her complaint was filed within the requisite five-year period, it was not untimely.

A federal court exercising diversity jurisdiction is required to apply the law of the forum when ruling on statutes of limitations. Guaranty Trust Co. v. York, 326 U.S. 99, 108-09, 65 S.Ct. 1464, 1469-70, 89 L.Ed. 2079 (1945). "Missouri, the forum, considers statutes of limitations issues procedural, and, therefore, governed by Missouri law." Renfroe v. Eli Lilly & Co., 686 F.2d 642, 646 (8th Cir.1982). Missouri law allows for a five-year period to bring actions for fraud or breach of an oral contract. Mo.Rev.Stat. Sec. 516.120. To determine the appropriate statute of limitations, however, section 516.120 must be read in conjunction with Mo.Rev.Stat. Sec. 516.190, Missouri's borrowing statute, which provides:

Whenever a cause of action has been fully barred by the laws of the state ... in which it originated, said bar shall be a complete defense to any action thereon, brought in any of the courts of this state.

Under section 516.190, when a cause of action originates in a state other than Missouri and that state's statute of limitations bars the action as untimely, the borrowing statute operates to adopt the foreign state's statute, thereby barring the action in Missouri as well. Renfroe, 686 F.2d at 646. "The purpose of [the] borrowing statute is primarily to prevent a plaintiff from forum shopping for a statute of limitations. The statute prevents a plaintiff from gaining more time to bring an action merely by suing in a forum other than where the cause of action accrued." Patch v. Playboy Enterprises, Inc., 652 F.2d 754, 756 (8th Cir.1981) (per curiam). The critical issue, then, in applying section 516.190 is determining where a cause of action originated.

The term "originated," as used in section 516.190, "has been construed to mean 'accrued.' " Thompson v. Crawford, 833 S.W.2d 868, 871 (Mo.1992) (en banc); see also, e.g., Dorris v. McClanahan, 725 S.W.2d 870, 871 (Mo.1987) (en banc).

Mo.Rev.Stat. Sec. 516.100 (1986) provides that

for the purposes of section 516.100 to 516.370, the cause of action shall not be deemed to accrue when the wrong is done or the technical breach of contract or duty occurs, but when the damage resulting therefrom is sustained and is capable of ascertainment, and, if more than one item of damage, then the last item, so that all resulting damage may be recovered, and full and complete relief obtained.

Under the capable-of-ascertainment test set forth in section 516.100, "a cause of action accrues when 'the injury to plaintiff was complete as a legal injury.' " Koester v. American Republic Investments, Inc., 11 F.3d 818, 821 (8th Cir.1994) (quoting Chemical Workers Basic Union v. Arnold Sav. Bank, 411 S.W.2d 159, 165 (Mo.1966) (en banc)). The damage must be actually sustained and capable of ascertainment before the right to sue arises and the statute of limitations begins to run. Business Men's Assurance Co. of America v. Graham, 891 S.W.2d 438, 445 (Mo.Ct.App.1994). " 'The most that is required is that some damages have been sustained, so that the claimants know that they have a claim for some amount.' " Koester, 11 F.3d at 821 (quoting Dixon v. Shafton, 649 S.W.2d 435, 439 (Mo.1983) (en banc)); see also Renfroe, 686 F.2d at 647. Section 516.100 determines not only when a claim accrues but also where it originates for purposes of considering the effect of the borrowing statute. Renfroe, 686 F.2d at 647 n. 9.

Nettles argues that the resolution of this case lies in the interpretation of section 516.100. Under her theory, although some damage may have been sustained and become capable of ascertainment when she discovered in October 1989 that AT & T had breached its promise of employment in California, the last item of damage--that is, her severe emotional distress and depression and resulting disability--did not occur until she was diagnosed in 1993 as suffering from those conditions. Therefore, her theory goes, because this last item of damage was not sustained and capable of ascertainment until she had returned to Missouri, the cause of action accrued and therefore originated in Missouri.

Nettles' theory rests on the assumption that damages resulting from a single wrong that develop and become more serious over time constitute separate items of damage. The Missouri courts have declined to give to the term "item of damage" the broad interpretation that Nettles argues for here. Section 516.100 "does not change the general rule that 'when an injury is complete as a legal injury at the time of the act, the period of limitation will at once commence.' " Rippe v. Sutter, 292 S.W.2d 86, 90 (Mo.1956) (quoting Allison v....

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