HORTON v. HAMILTON
2015 OK 6
| Okla. | 2015Background
- Horton purchased a $100,000 Life Fund 5.1 capital appreciation bond after attending a seminar presented by Hamilton and Peck in 2007; she later received a call from the Oklahoma Securities Commission that it was investigating possible fraud.
- The bond was issued Oct. 1, 2007; Horton received it Nov. 21, 2007, then repeatedly sought return of her funds and worked with the Commission.
- Life Fund 5.1 filed bankruptcy Sept. 2, 2009; Horton filed a proof of claim Sept. 15, 2009, and hired counsel in Sept. 2009.
- Horton sued in state district court Dec. 10, 2009 asserting Securities Act misrepresentation, common-law fraud, breach of fiduciary duty, negligence, and gross negligence; two statutory Securities Act claims were previously dismissed.
- Defendants moved for summary judgment arguing all remaining claims were time-barred by two-year statutes of limitations; the district court and Court of Civil Appeals granted summary judgment, prompting certiorari.
- The Oklahoma Supreme Court reversed, holding defendants failed to supply sufficient evidentiary material to establish when Horton knew or should have discovered the facts giving rise to each claim.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| When did Horton's Securities Act misrepresentation claim accrue / when did limitations begin to run? | Horton: discovery did not occur until later; factual dispute exists about what she learned and when. | Defs: limitations began when Horton first sought return of funds and learned of the Commission call in 2007. | Reversed — defendants failed to show as a matter of law when Horton discovered or should have discovered the misrepresentations; question is factual. |
| Whether Horton's common-law fraud claim was time-barred | Horton: fraud discovery occurred later; pleading requires particularized facts, so earlier concern was insufficient. | Defs: Horton knew or should have known of fraud in 2007 when she sought her money and spoke to the Commission. | Reversed — insufficient evidence to establish discovery date; material factual dispute remains. |
| Whether defendants owed a per se fiduciary duty and when negligence/fiduciary claims accrued | Horton: alleged meetings and reliance created fiduciary relationship; claims accrued upon discovery of damage. | Defs: argue claims accrued early; no per se broker fiduciary duty and Horton knew earlier. | Reversed — existence of fiduciary duty is fact-specific; defendants did not prove when Horton discovered tort elements; issue for factfinder. |
| Whether Life Fund 5.1 bankruptcy tolled the statutes of limitations against the individual defendants | Horton: bankruptcy stay and proceedings tolled limitations. | Defs: no connection between debtor and defendants; stay does not apply to non-debtors. | Affirmed (as to lack of proof) — Horton presented no evidentiary basis showing the automatic stay or bankruptcy tolled claims against these non-debtors; she may pursue the argument with evidence at trial. |
Key Cases Cited
- Pickens v. Tulsa Metro. Ministry, 951 P.2d 1079 (Okla. 1997) (standard of review and summary judgment principles)
- Consol. Grain & Barge Co. v. Structural Sys., Inc., 212 P.3d 1168 (Okla. 2009) (accrual requires each element to have materialized)
- Digital Design Grp., Inc. v. Info. Builders, Inc., 24 P.3d 834 (Okla. 2001) (discovery rule delays statute of limitations until injured party knows or should have known of injury)
- Redwine v. Baptist Med. Ctr. of Okla., Inc., 679 P.2d 1293 (Okla. 1983) (defendant must prove when plaintiff knew or should have discovered claim to support summary judgment on limitations)
- Lampf, Pleva, Lipkind, Prupis & Petigrow v. Gilbertson, 501 U.S. 350 (U.S. 1991) (federal securities-law accrual/discovery inquiry-notice standard)
- Smith v. Baptist Found. of Okla., 50 P.3d 1132 (Okla. 2002) (statute of limitations on fiduciary claims begins when beneficiary learns it suffered damage that might be trustee's fault)