356 P.3d 1049
Idaho2015Background
- Several men (Appellants) sued Boy Scouts of America and the LDS Church alleging constructive fraud for failing to disclose dangers of sexual abuse by scout leaders and affirmatively misrepresenting leaders as trustworthy.
- Defendants moved to certify questions to the Idaho Supreme Court about (1) which statute of limitations governs constructive fraud and (2) when such a cause of action accrues.
- The federal district court framed the dispute as whether the claim is substantive constructive fraud (subject to fraud limitations) or effectively a personal-injury/breach claim (subject to other limitations).
- Idaho law requires choosing the limitations period based on the substance (not form) of the claim; the district court rejected characterizing these claims as personal-injury for statute-of-limitations purposes.
- The Idaho Supreme Court accepted certification and limited its review to (1) which statute of limitations applies to constructive fraud, and (2) when the cause of action accrues.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Which statute of limitations governs constructive fraud? | Fraud statute (Idaho Code § 5-218(4)) applies to constructive fraud. | Personal-injury or catch-all statute should apply (defendants argued personal injury or §5-224). | Idaho Code § 5-218(4) (fraud statute) governs constructive fraud claims. |
| When does a constructive fraud claim accrue? | Discovery rule: accrual is delayed until plaintiff knew or reasonably should have known the facts constituting the fraud. | Accrues at time of the abusive act (defendants argued abuse was immediately discoverable and thus started accrual). | The discovery rule in § 5-218(4) applies: accrual is when plaintiff had actual or constructive knowledge of facts constituting the fraud (a fact question for the trial court). |
Key Cases Cited
- Hillock v. Idaho Title & Trust Co., 22 Idaho 440, 126 P. 612 (1912) (implicitly applied fraud limitations to actions grounded in mistake or constructive fraud and endorsed discovery accrual)
- McCoy v. Lyons, 120 Idaho 765, 820 P.2d 360 (1991) (interpreted §5-218(4) to require accrual when plaintiff knew or reasonably should have known facts constituting fraud)
- Nancy Lee Mines, Inc. v. Harrison, 95 Idaho 546, 511 P.2d 828 (1973) (assumed fraud limitations apply and discussed discovery/inference of knowledge)
- McGhee v. McGhee, 82 Idaho 367, 353 P.2d 760 (1960) (defined constructive fraud as breach of duty in relationship of trust; explained elements overlap with fraud)
- Country Cove Dev., Inc. v. May, 143 Idaho 595, 150 P.3d 288 (2006) (distinguished constructive fraud and breach of fiduciary duty as separate causes of action)
- Jones v. Runft, Leroy, Coffin & Matthews, Chartered, 125 Idaho 607, 873 P.2d 861 (1994) (applied catch-all statute to fiduciary-duty claims but did not convert constructive fraud into breach-only category)
