Hall v. Romero, 1
| Decision Date | 23 February 1984 |
| Docket Number | CA-CIV,No. 1,1 |
| Citation | 685 P.2d 757,141 Ariz. 120 |
| Parties | Gwendolyn HALL, a divorced woman; W.J. Spranger and Alta Marie Spranger, husband and wife, Clarence W. Siewert and Rose Zeena Siewert, husband and wife, Robert A. Celaya and Lucy L. Celaya, husband and wife, R.J. Gillespie and Una Gillespie, husband and wife, Charles Hall and Lois Hall, husband and wife, Darrel L. Lawson, a married man, Raymond J. Herst, a widower, Jacquelyn Herst, a single woman, on behalf of themselves and all other individuals similarly situated, Plaintiffs-Appellants, v. Cesar ROMERO and Jane Doe Romero, husband and wife, Defendants-Appellees. 5488. |
| Court | Arizona Court of Appeals |
Gallagher & Kennedy by Michael L. Gallagher and J. Ruth Sproull, Phoenix, for defendants-appellees.
This appeal stems from the trial court's grant of summary judgment for the defendant, a television and movie celebrity, against plaintiffs, buyers of certain real estate.
The relevant facts began in 1971, when Cesar Romero, a Hollywood personality, contracted with Consolidated Mortgage Company (Consolidated) to assist in promoting Consolidated's Arizona real estate venture, Chino Valley Estates. Romero agreed to make personal appearances at the property, to sign autographs, to greet prospective buyers, and to tape some television commercials. Under the terms of the contract, Consolidated had the right to use Romero's name in its promotional material. Romero was paid a flat monthly fee for his services. Consolidated used Romero's picture on a billboard and on a brochure, among other advertisements.
The named plaintiff-buyers bought their respective lots in 1972. At that time, the lots were minimally developed, Consolidated promising to improve them with underground utilities, a lake, paved roads, recreational facilities, and other amenities. The record is silent regarding the date by which Consolidated specifically promised to complete the Chino Valley improvements; however, the evidence reveals that no improvements were made even by 1977.
In May, 1974, the Arizona Attorney General instituted a suit against Consolidated, on behalf of the purchasers of the Chino Valley lots, for Consolidated's failure to improve the lots as it had promised. Romero was not involved in this action. The attorney general informed Chino Valley buyers (including plaintiffs) of the suit in a letter dated November 8, 1974. The buyers were informed that the suit was settled, and that Consolidated had agreed to make the promised improvements within twenty-eight months. As of August, 1977, at the expiration of the twenty-eight months, Consolidated still had not made the promised improvements. Plaintiffs filed this action against Romero in February, 1978, alleging that Romero negligently misrepresented the viability and stability of the Chino Valley investment through his "association" with the project and through his lending his name for the project's promotion. Romero filed a motion for summary judgment, on the grounds that the plaintiffs' suit was barred by the statute of limitations, A.R.S. § 12-542, and that Romero owed no legal duty to the plaintiffs upon which he could be held liable. The trial judge found no genuine issue of material fact, and granted Romero's motion for summary judgment, without stating the basis for his ruling. Plaintiffs appealed.
Two issues are thus presented on appeal: First, whether plaintiffs' claim was barred by the statute of limitations; second, whether Romero owed some duty to plaintiffs, on which basis Romero could be held liable to them had he been in breach. We hold that plaintiffs' claim was barred by the statute of limitations. Thus, we need not reach the second issue.
Which statute of limitations applies?
Plaintiffs recognize that the two-year statute, A.R.S. § 12-542(3), applies to actions "for trespass for injury done to the estate or the property of another." However, plaintiffs urge us to apply either the three-year statute, A.R.S. § 12-543, which applies to actions grounded in fraud; or the four-year general statute, A.R.S. § 12-550, which applies to actions to which no other statute applies.
We are aware of the principle that when there is substantial doubt as to which limitation period is applicable, the longer should be applied, Sato v. Van Denburgh, 123 Ariz. 225, 599 P.2d 181 (1979), however, we are not in substantial doubt. We hold that the two-year limitation provided by A.R.S. § 12-542 applies to this suit.
A.R.S. § 12-542 applies by its own terms to suits involving injury to property. Here, plaintiffs claim damages for "having spent substantial sums of money in purchasing lots which are virtually worthless," which clearly constitutes injury to their property. Additionally, A.R.S. § 12-542 applies to actions "sounding in negligence or tort." See Sato v. Van Denburgh, supra. Plaintiffs' theory of negligent misrepresentation falls within this category.
The general four-year limit of A.R.S. § 12-550 cannot apply because the two-year limit is prescribed for this type of action, as discussed above. Furthermore, A.R.S. § 12-543, the three-year provision for fraud claims, cannot apply for several reasons. We note that in plaintiffs' Third Amended Complaint, the only "representation" which plaintiffs attribute to Romero is the statement printed on a brochure, "I'm sure you'll never find a better, more secure investment." First, a representation of opinion will ordinarily not be regarded as a basis for actionable fraud. Page Investment Co. v. Staley, 105 Ariz. 562, 468 P.2d 589 (1970). The trial judge could have concluded that Romero's statement was merely an opinion. Second, actionable fraud cannot be predicated on unfulfilled promises, expressions of intention or statements concerning future events, unless such were made with the present intent not to perform. Staheli v. Kauffman, 122 Ariz. 380, 595 P.2d 172 (1979). Assuming Romero made statements about forthcoming improvements, the record lacks any evidence as to Romero's knowledge that Consolidated would not perform. Third, plaintiffs failed to plead the nine elements of fraud with particularity, as required by Rule 9(b), Ariz.Rules of Civil Procedure. We recognize that magic language is not necessary in pleading fraud, as long as the pleading, considered as a whole, can be construed to plead the nine elements. Spudnuts, Inc. v. Lane, 131 Ariz. 424, 641 P.2d 912 (App.1982). However, allegations that a defendant's actions are "fraudulent" are insufficient. Id.
Regarding the one statement which plaintiffs affirmatively attribute to Romero, plaintiffs fail to allege with particularity facts to show its falsity (i.e., that Romero was not sure they would find a better investment); its materiality; the buyers' ignorance of its falsity; their reliance on this statement, and their right to rely on this statement. Plaintiffs allege only that "because of Romero's various sales and promotional activities, and the esteem in which he was held," they purchased their lots and expected the improvements to be installed as promised. We hold that the plaintiffs' complaint fails to allege a cause of action for fraud.
Plaintiffs contend that the trial court erred in denying their motion to amend their Third Amended Complaint to allege fraud. We disagree. A motion for leave to amend the pleadings is within the sound discretion of the trial court, and we will not overturn that decision absent a clear abuse of discretion. Matter of Estate of Torstenson, 125 Ariz. 373, 609 P.2d 1073 (App.1980). Plaintiffs sought to amend their complaint after summary judgment had been entered against them. They had already amended their complaint twice. The plaintiffs' proffered "new" evidence, two pictures of Romero at Chino Valley Estates, did not tend to support their fraud allegation. Although courts are generally liberal in allowing amendments to pleadings, we hold that the trial judge did not abuse his discretion in denying plaintiffs' motion.
The two-year statute of limitations begins to run when the plaintiff knows or should have known of the defendant's negligent conduct, or when the plaintiff is first able to sue. Sato v. Van Denburgh, 123 Ariz. 225, 599 P.2d 181 (1979). In order to determine when the Chino Valley buyers knew of Romero's alleged misrepresentations, we first must assume that Romero made representations as to improvements, and second, that those representations became "negligent misrepresentations" when it became obvious that Consolidated was not going to improve the lots in the time and manner promised. Thus, the running of the statute of limitations against Romero is initially conditioned upon the point at which Consolidated failed to perform. After deciding when Consolidated failed to perform, we must then determine when plaintiffs knew or should have known of that failure, and thus, that Romero's representations as to improvements were not true.
The record before us fails to evidence a clear-cut oral or written promise to the plaintiffs that their improvements would be completed within a definite period of time. However, the following pertinent facts indicate when Consolidated failed to perform, and when plaintiffs knew of that failure.
1. Plaintiffs rely on a Chino Valley Estates brochure to show Romero's misrepresentations. That brochure advised:
An additional clubhouse and recreation area is planned and scheduled for completion by the end of 1972, with a large lake for swimming and fishing to be completed before the end of 1973.
2. Plaintiffs also rely on the Winter, 1972 edition of "Chino Valley Newsy Notes" to support their claim. That newsletter promised:...
To continue reading
Request your trial
-
Duyck v. Tualatin Valley Irr. Dist.
...between deceit and negligence, have held that the negligence statute of limitations is the applicable standard. Hall v. Romero, 141 Ariz. 120, 123, 685 P.2d 757 (App.1984) is illustrative. There, the question was whether the plaintiffs' negligent representations claim was governed by the fr......
-
Union Pacific Resources Co. v. State
...to a particular fact situation--in this case involving the collection of delinquent taxes--is a determination of law. Hall v. Romero, 141 Ariz. 120, 685 P.2d 757 (1984); Pembee Mfg. Corp. v. Cape Fear Const. Co., Inc., 313 N.C. 488, 329 S.E.2d 350 (1985); Smart v. Texas American Bank/Galler......
-
Aubuchon v. Brock
...not all of its claims were futile.¶13 We review the denial of a motion to amend for abuse of discretion. Hall v. Romero, 141 Ariz. 120, 124, 685 P.2d 757, 761 (App. 1984). It is within the court's discretion to deny a motion to amend based on futility in the proposed amendment. Bishop v. St......
-
Warfield v. Alaniz
...Rada Defendants' Motion for Summary Judgment. A state law claim for fraud must be plead with particularity. Hall v. Romero, 141 Ariz. 120, 124, 685 P.2d 757, 761 (Ct.App.1984). Mere allegations that the defendants' actions were "fraudulent" are insufficient. Id. A complaint fails to state a......