Keesling v. Baker & Daniels
| Decision Date | 21 May 1991 |
| Docket Number | No. 73A01-9012-CV-486,73A01-9012-CV-486 |
| Citation | 571 N.E.2d 562 |
| Parties | Leroy KEESLING, Vivian Keesling, and Leroy Keesling Farms, Plaintiffs-Appellants, v. BAKER & DANIELS, Daniel Johnson and James Carr, Defendants-Appellees. |
| Court | Indiana Appellate Court |
Dean E. Richards, Indianapolis, for plaintiffs-appellants.
William P. Wooden, Katherine L. Shelby, Wooden, McLaughlin & Sterner, Indianapolis, J. Lee McNeely, Shelbyville, for defendants-appellees.
Plaintiff-appellants Leroy Keesling, Vivian Keesling and Leroy Keesling Farms (collectively, the Keeslings) appeal the trial court's entry of summary judgment in favor of defendant-appellees Baker & Daniels, Daniel Johnson and James Carr (collectively, Baker & Daniels) in this action for attorney malpractice. We affirm.
The Keeslings raise the following issues for our review:
I. Whether the trial court erred in finding their action was barred by the applicable statute of limitations.
II. Whether the trial court abused its discretion in granting Baker & Daniels' motions for protective orders relating to discovery.
III. Whether the trial court erred in denying admission of certain evidence offered by the Keeslings.
This action for alleged attorney malpractice arose out of Baker & Daniels' representation of the Keeslings in a Chapter 11 bankruptcy case filed August 28, 1980. During the representation of the Keeslings, Baker & Daniels realized that the Keeslings might be able to assert a defense or claim against one of the creditors, Lafayette Production Credit Association (LPCA). Baker & Daniels was concerned about a potential conflict of interest because they had represented other Production Credit Associations with respect to other claims and defenses. To alleviate the concern, Baker & Daniels had the Keeslings execute an application to employ special counsel in February of 1983. The bankruptcy court granted the application, and Bose, McKinney & Evans was authorized to represent the Keeslings as special counsel in the LPCA matter.
The bankruptcy court confirmed the Keeslings' second amended consolidated plan of reorganization on February 13, 1985. Baker & Daniels petitioned for leave to withdraw as Keeslings' counsel in July of 1985, after the Keeslings failed to communicate with the firm concerning their obligations under the plan, and failed to pay money they owed to the firm. The bankruptcy court approved the withdrawal of Baker & Daniels on August 12, 1985.
Subsequently, on August 24, 1987, 1 the Keeslings filed an action for attorney malpractice against Baker & Daniels alleging the firm failed to adequately represent them, and failed to disclose the potential conflict of interest. Baker & Daniels moved for summary judgment, which was granted by the trial court. The Keeslings now appeal.
When reviewing an entry of summary judgment, this court applies the same standard as the trial court. Summary judgment shall be granted only if the pleadings, depositions, answers to interrogatories, and affidavits show there is no genuine issue of material fact and the moving party is entitled to judgment as a matter of law. All evidence is construed in favor of the non-movant. 2 Hatton v. Fraternal Order of Eagles (1990), Ind.App., 551 N.E.2d 479, trans. denied.
The parties agree that because this is an action for attorney malpractice, the applicable statute of limitations is two years. See IND. CODE 34-1-2-2(1). 3 It is not apparent precisely when the alleged attorney malpractice took place; however, Baker & Daniels represented the Keeslings in the bankruptcy action from approximately August of 1980 until August 12, 1985. Assuming the alleged malpractice occurred on the last day of Baker & Daniels' representation of the Keeslings, a very unlikely assumption and an assertion not made by the Keeslings, the Keeslings' cause of action had to be brought by August 12, 1987. They did not file their claim against Baker & Daniels until August 24, 1987. Their claim is thus barred by the applicable statute of limitations.
The Keeslings do not disagree with the above analysis, but rather argue the statute of limitations was tolled by fraudulent concealment. "The doctrine of fraudulent concealment operates to estop a defendant from asserting a statute of limitations defense when that person, by deception or a violation of a duty, has concealed material facts from the plaintiff thereby preventing discovery of a wrong." Hospital Corp. of America v. Hiland (1989), Ind.App., 547 N.E.2d 869, 873, aff'd on transfer, Cacdac v. Hiland (1990), Ind., 561 N.E.2d 758. Fraudulent concealment can arise from either active efforts to conceal malpractice, or from a failure to disclose material information when a fiduciary or confidential relationship exists. Id.
In this case, the Keeslings argue there was fraudulent concealment under the "active efforts to conceal" branch of the doctrine because Baker & Daniels did not keep the Keeslings informed, sacrificed the Keeslings' interests in favor of their own, and ignored direct requests for relevant information. 4 To be affirmative acts of concealment, the actions must be calculated to mislead and hinder a plaintiff from obtaining information by the use of ordinary diligence, or to prevent inquiry or elude investigation. Ludwig v. Ford Motor Co. (1987), Ind.App., 510 N.E.2d 691, trans. denied. "There must be some trick or contrivance intended by the defrauder to exclude suspicion and prevent inquiry." Id. at 697. The Keeslings cite absolutely no evidence to support the allegation of active fraudulent concealment. In a summary judgment proceeding, the non-movants may not rest on the allegations or denials of their pleadings, but must respond with affidavits or other evidence setting forth specific facts showing there is a genuine issue in dispute. Willsey v. Peoples Federal Sav. & Loan (1988), Ind.App., 529 N.E.2d 1199, trans. denied. The Keeslings have not so responded. 5
Even if we were to assume the Keeslings have shown evidence to support their active fraudulent concealment allegation, we would find their action barred by the statute of limitations. Under the fraudulent concealment doctrine, a plaintiff does not have the full statutory period from the discovery of the alleged malpractice in which to file a claim. Hospital Corp., supra. The plaintiff has the responsibility to institute an action within a reasonable time after discovery of the alleged malpractice. Id. "Thus, although equitable grounds exist for estopping a defendant from claiming the statute of limitations as a defense, estoppel will be denied if the plaintiff fails to exercise due diligence in filing his claim after the equitable grounds cease to be operational as a valid basis for inducing the plaintiff's delay." Id. at 873.
In this case, the Keeslings acknowledge they became aware of their claim sometime in the fall of 1985. Yet they waited almost two years to file their action against Baker & Daniels. The Keeslings do nothing to attempt to explain the delay. The action was not filed within a reasonable time. See id. ( action filed 22 months after the latest date plaintiff discovered alleged malpractice was not filed within a reasonable time); Cyrus v. Nero (1989), Ind.App., 546 N.E.2d 328 (). The trial court did not err in granting summary judgment in favor of Baker & Daniels because the Keeslings' claim was barred by the applicable statute of limitations.
The Keeslings argue the trial court abused its discretion in granting protective orders with respect to discovery, and thus removed a meaningful route of their response to Baker & Daniels' motion for summary judgment. The scope of discovery is a matter highly dependent upon the facts of each case. Vibromatic Co. v. Expert Automation Systems (1989), Ind.App., 540 N.E.2d 659. The grant or denial of motions for discovery rests within the sound discretion of the trial court, and will be reversed only for an abuse of discretion. Id.
The Keeslings first argue the trial court abused its discretion in granting protective orders for non-parties from whom the Keeslings wished to receive information. Ind. Trial Rule 34(C) governs production from non-parties. The request must set forth the items to be inspected either by item or category, and describe the items or categories with reasonable particularity. In addition, the request shall specify a reasonable time, place and manner of making the inspection. Finally, the notice "shall also state that the witness or person to whom it is directed is entitled to security...." T.R. 34.
Keeslings' requests for production asked for all materials, correspondence and financial statements which the non-parties possessed relative to the Keeslings from 1975 to the present (1987). The requests did not list items or categories with reasonable particularity, and said nothing about the non-parties' entitlement to security. Additionally, the notices stated "[p]roduction of these documents may be made by forwarding a copy of the documents requested to the law offices of [the Keeslings' attorney]." Record at 53, 57, 59, 62, 65, 68-69. We do not find it an abuse of discretion for the trial court to grant a protective order under these circumstances; the Keeslings did not comply with T.R. 34, and requested that the non-parties copy and mail to the Keeslings' attorney 12 years of documents relating to the Keeslings. A party wishing to obtain information from non-parties must put forth a little more effort in the discovery process than was done here.
Additionally, the trial court denied the protective order as to non-party Bose, McKinney & Evans, the law firm which took over all matters related to the LPCA matter in early 1983, and the Keeslings received substantial discovery from this source. The court also required the parties to meet and...
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