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§42.9 Fraudulent Concealment Exception to Statute of Limitations

The Case: Doe v. Catholic Bishop for the Diocese of Memphis , No. W2007-01575-COA-R9-CV, 2008 WL 4253628 (Tenn. Ct. App. Sept. 16, 2008), perm. appeal denied, (Mar. 16, 2009).

The Bottom Line:

  • "A close cousin of the discovery rule is the 'well accepted principle . . . of fraudulent concealment.'" Mark K. v. Roman Catholic Archbishop of L. A., 79 Cal. Rptr. 2d 73, 78 (Cal. Ct. App. 1998) (quoting Bernson v. Brown, 873 P.2d 613 (Cal. 1994)).

    The Tennessee Supreme Court has set forth the elements of fraudulent concealment:
    To establish fraudulent concealment, a plaintiff must prove (1) that the defendant took affirmative action to conceal the cause of action or remained silent and failed to disclose material facts despite a duty to do so and, (2) the plaintiff could not have discovered the cause of action despite exercising reasonable care and diligence.

    The third essential element of fraudulent concealment is knowledge on the part of the defendant of facts giving rise to the cause of action. In other words, the defendant must be aware of the wrong.

    The fourth and final essential element of fraudulent concealment is a concealment of material information from the plaintiff.
    Shadrick v. Coker, 963 S.W.2d 726, 735 (Tenn. 1998) (citations omitted). If a fiduciary relationship exists between the plaintiff and defendant, the party asserting fraudulent concealment need not show affirmative concealment of the cause of action, because 'failure to speak where there is a duty to speak is the equivalent of some positive act or artifice planned to prevent inquiry or escape investigation.' Id. (quoting Hall v. De Saussure, 297 S.W.2d 81, 85 (Tenn. Ct. App. 1956))." 2008 WL 4253628 at *6.
  • "In this case, Doe asserts in his complaint that, at the time he was being victimized, the Diocese had knowledge of other complaints of sexual abuse against Father DuPree. For purposes of the Diocese's motion to dismiss, we assume the truth of this allegation. Such information would be material to Doe's claim that the Diocese negligently hired, supervised, or retained Father DuPree. Doe asserts a fiduciary or special relationship between the Church and its parishioner, such as Doe, that created an affirmative duty on the part of the Diocese to inform Doe of Father DuPree's pedophilic tendencies. The Diocese's failure to speak in the face of such a duty is the wrongful act of which it is accused, and also the equivalent of an affirmative act of fraudulent concealment. For purposes of the motion to dismiss, the Diocese does not appear to dispute the existence of such a fiduciary relationship. Thus, for purposes of this appeal, we assume arguendo that the Diocese knew of Father DuPree's propensities before Father DuPree began abusing Doe, had a duty to disclose such to Doe, and failed to do so." Id. (footnotes omitted).
  • "Under the doctrine of fraudulent concealment, the question remains whether Doe, in the exercise of reasonable care and diligence, could have discovered his cause of action against the Diocese; that is, whether Doe could have discovered that, at the time of Doe's abuse, the Diocese had prior knowledge of Father DuPree's proclivities. See Shadrick, 963 S.W.2d at 735." Id. at *7.
  • "... we must focus on whether Doe had 'inquiry notice' of the alleged fact that, prior to Father DuPree's molestation of Doe, the Diocese had knowledge of instances of sexual abuse of other children.FN10 Stated differently, had Doe exercised reasonable diligence at the time he reached majority, would he have learned that the Diocese had knowledge of Father DuPree's prior sexual abuse, and that it chose not to disclose this information to protect Doe?
    FN10. '[A]ctual notice' is that notice which a plaintiff actually possesses; 'inquiry notice' is that notice which a plaintiff would have possessed after due investigation. Cevenini v. Archbishop of Wash., 707 A.2d 768, 771 (D.C. 1998) (quoting Diamond v. Davis, 680 A.2d 364, 372 (D.C. 1996))."
    Id. at *8.
  • "From our review of decisions from other jurisdictions, the apparent majority hold as a matter of law that the plaintiff, in the exercise of reasonable diligence, would have discovered the defendant church's knowledge of the clergy member's prior acts of abuse, and that the plaintiff's lawsuit against the church is time-barred. A minority of courts have denied the defendants' motions to dismiss, holding that a fact issue exists as to whether the plaintiff, in the exercise of reasonable diligence, would have discovered the church's alleged knowledge of the prior sexual abuse." Id.
  • "...the majority of courts appear to have found that plaintiffs in Doe's position had inquiry notice, and that their claims were time-barred. These courts have emphasized that, even if the plaintiff did not know that the church was a cause of the injury, the plaintiff knew that he had been injured by the clergy member and was obligated to investigate the responsibility of the cleric's employer. At that point in the analysis, most of these courts simply concluded that the plaintiff would have discovered the church's prior knowledge. However, the Cevenini court took its analysis one step further, finding that because the priest and the church were clearly connected, a reasonable plaintiff would have investigated claims against the predator priest, and against the church." Id. at *12 (footnote omitted).
  • "We now consider the reasoning in these cases as applied to the facts in the case at bar, focusing on the issue of Doe's inquiry notice." Id. at *14.
  • "Doe insists that the statute of limitations should be tolled because, 'regardless of what other information Plaintiff may have possessed at the time of his abuse, Plaintiff did not have sufficient facts to bring a negligence claim against the Diocese . . . as he did not know the facts demonstrating that the Diocese was negligent.'" Id.
  • "We must reject this argument. As in Meehan, Doe's child abuse was the injury, not the Diocese's 'alleged cover-up.' Meehan, 870 A.2d at 921. In reality, Doe claims that he was 'unaware, not of [his] injury, but of a secondary cause of [his] injury (the primary cause being the individual who committed the abuse).' Id. at 920. As in Mark K., Doe knew that Father DuPree was a priest of the Diocese, obligating him 'to determine, as with any employer whose employee has injured a third party, whether the church shouldered some responsibility for the misconduct of its priest.' Mark K., 79 Cal. Rptr. 2d at 79." Id.
  • "We cannot, however, simply accept the Diocese's repeated conclusory assertion that Doe's knowledge of his abuse, the identity of his abuser, and the relationship between the abuser and the Diocese gave Doe sufficient knowledge to put him on inquiry notice of a possible claim against the Diocese. In a number of the cases cited above, the court adopted precisely this analysis. This equates to a finding in essence that, had Doe pursued any claim against the Diocese at the time he reached majority, he would have learned through discovery that there were prior instances of child sexual molestation by Father DuPree and that the Diocese had knowledge of such instances. This analysis, however, seems insufficient; we think it is necessary to examine in some detail what Doe knew at the time he reached majority, and follow the thread of what would have happened had Doe pursued a claim against the Diocese in 1987." Id.
  • "In 1987, Doe knew that he had been abused by Father DuPree as a minor, and either knew or could have easily ascertained that Father DuPree was employed by the Diocese. Doe had no actual knowledge that, at the time of Doe's abuse, the Diocese had information on Father DuPree's proclivities and failed to inform Doe or protect him from Father DuPree." Id. at *15.
  • "With this set of facts, the only claim that Doe could have asserted against the Diocese at the time was for vicarious liability, under the doctrine of respondeat superior. Had Doe filed such a lawsuit against the Diocese, could he then have conducted discovery and learned that there were other minor victims of Father DuPree's abuse, and that the Diocese had prior knowledge of them?" Id.
  • "We find no reported Tennessee cases applying the doctrine of respondeat superior to a clergy member accused of child sexual abuse. Cases from other jurisdictions on this issue have had mixed results. One commentator has noted that sexual batteries are generally deemed to be outside the scope of employment unless the tortfeasor employee used his employment to commit the tort, and adds: 'Notwithstanding the fact that allegations of a cleric's sexual misconduct often include situations where the cleric used his or her position in the Church to gain the trust of and access to a victim, most courts have been unwilling to apply this exception to clergy sexual abuse cases.' Jana Satz Nugent, Note, A Higher Authority: the Viability of Third Party Tort Actions Against a Religious Institution Grounded on Sexual Misconduct by a Member of the Clergy, 30 FLA. ST. U. L. Rev. 957, 968 (2003); see also, e.g., Tichenor v. Roman Catholic Church of the Archdiocese of New Orleans, 32 F.3d 953, 960 (5th Cir. 1994) ('It would be hard to imagine a more difficult argument than that [a priest's] illicit sexual pursuits were somehow related to his duties as a priest . . . .'); A.L.M. v. Diocese of Allentown, 68 Pa. D. & C.4th at 124-25 (finding that, under Pennsylvania law, the offending priest's sexual abuse would have been deemed outside the scope of employment). The court in A.L.M. concluded that the plaintiff could not have pursued a lawsuit against the church based on vicarious liability, and thus could not have discovered that the church was a separate cause for his injury. A.L.M., 68 Pa. D. & C. 4th at 123-25." Id.
  • "We need not decide at this juncture whether, in 1987, a Tennessee court would have held that Father DuPree's alleged sexual abuse of Doe was outside the course and scope of Father DuPree's employment. It is enough that the issue is unclear, and there is a substantial possibility that, had Doe asserted a claim of respondeat superior against the Diocese in 1987, the Diocese would have been granted a judgment on the pleadings, precluding Doe from conducting discovery which could have led to other possible claims. Absent such discovery, there would have been no way for Doe to learn that the Diocese had been aware that Father DuPree was a sexual predator. Therefore, we are unwilling to hold that, as a matter of law, had Doe filed a lawsuit only against the Diocese, he would have learned of the Diocese's knowledge of prior instances of child abuse." Id. at *16
  • "Our analysis, however, does not end there. We must also consider the analysis utilized in Cevenini. In Cevenini, the court held that the plaintiff's knowledge of wrongdoing on the part of the priest placed the plaintiff on notice of claims against the church, because the priest and the church were closely connected in a superior-subordinate relationship. Cevenini, 707 A.2d at 773. The Cevenini court explained:
    In some circumstances . . . the relationship of the defendants, together with these facts, may establish as a matter of law that a reasonable plaintiff with knowledge of the misconduct of one would have conducted an investigation as to the other. If that investigation would, as a matter of law, have revealed some evidence of wrongdoing on the part of the other defendant, then the cause of action will have accrued as to both.

    Thus . . . while knowledge of misconduct on the part of one defendant will not automatically create inquiry notice of claims against a potential co-defendant, such notice may be charged to the plaintiff if (1) a reasonable plaintiff would have conducted an investigation as to the co-defendant, and (2) such an investigation would have revealed some evidence of wrongdoing.
    Id. (quoting Diamond, 680 A.2d at 380). TheCevenini court concluded that a reasonable plaintiff would have conducted an investigation of both the priest and the co-defendant church, and that such an investigation would have revealed the church's knowledge of prior child sexual abuse by the priest." Id.
  • "Should we hold, then, that a reasonable person in Doe's position in 1987 would have filed a lawsuit against a separate potential co-defendant, namely Father DuPree? In this case, Doe would have been aware in 1987 that he had a claim against Father DuPree. Without question, Father DuPree and the Diocese are closely connected, in a superior-subordinate relationship. Unlike a respondeat superior claim against the Diocese, there is no reason to believe that a lawsuit by Doe against Father DuPree at that time would have been repelled by a court at the pleading stage, prior to discovery. Had Doe filed a lawsuit against Father DuPree, he would have had the opportunity to conduct routine discovery, which would almost certainly have involved questions regarding prior child sexual abuse by Father DuPree, as well as the Diocese's knowledge of such prior abuse. This would have provided a mechanism for Doe to learn that the Diocese had been negligent." Id.
  • "We find no Tennessee cases comparable to Cevenini or the cases cited therein. But we think that the rationale makes sense. We are unwilling to hold that knowledge of misconduct on the part of one defendant automatically results in a finding of inquiry notice of claims against a potential co-defendant. However, in appropriate circumstances, the plaintiff should be charged with inquiry notice of what an investigation of the potential co-defendant would have revealed. This is appropriate where the potential co-defendants are closely connected, as with an employer/employee relationship. We therefore adopt the rationale set forth in Cevenini, supra, and Diamond, supra. Id. at *17.
  • Had the Diocese been asked about Father DuPree's prior offenses in 1987, we cannot know whether the Diocese would have been forthcoming in response to such inquiries. As in Cevenini, had Doe requested such information and been refused, 'our decision might be different.' Cevenini, 707 A.2d at 774. But the tolling theories relied upon by Doe are only available to a plaintiff who has exercised reasonable diligence. '[T]he plaintiff must go find the facts; [he] cannot wait for the facts to find [him].' Jolly v. Eli Lilly & Co., 44 Cal.3d 1103, 1110-11 (Cal. 1988), quoted in Mark K., 79 Cal. Rptr. 2d at 77." Id. (footnote omitted).
  • "Therefore, under all of these circumstances, we find that plaintiff Doe, in the exercise of reasonable diligence, would have learned in 1987 about his right of action against the Diocese for negligent supervision and retention of Father DuPree. Consequently, we must conclude that Doe's complaint against the Diocese is barred under the one-year statute of limitations, and that the trial court erred in denying the Diocese's Rule 12.02(6) motion to dismiss." Id.

Recent Cases: 

Redwing v. Catholic Bishop for the Diocese of Memphis, No. W2009-00986-SC-R11-CV, 363 S.W.3d 436 (Tenn. Feb. 27, 2012) (finding diocese made prima facie showing that statute of limitations barred claims for negligent hiring, supervision, and retention but reversing dismissal finding allegations in victim’s complaint could, if proven, allow fact-finder to conclude doctrine of fraudulent concealment applied).

C.S. v. Diocese of Nashville , No. M2007-02076-COA-R3-CV, 2008 WL 4426891 (Tenn. Ct. App. Sept. 30, 2008), perm. appeal denied, (Mar. 16, 2009) (affirming summary judgment finding plaintiff had sufficient time to discover his cause of action and finding statute of limitations was not tolled on basis of fraudulent concealment).

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The foregoing is an excerpt from Day on Torts: Leading Cases in Tennessee Tort Law, published by John A. Day, Civil Trial Specialist, Fellow in the American College of Trial Lawyers, recipient of Best Lawyers in America recognition, Martindale-Hubbell AV® Preeminent™ rated attorney, and Top 100 Tennessee Mid-South Super Lawyers designee. Read John’s full bio here.

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