Jeppesen v. Bank of Utah, 438 P.3d 81

Background

In 2001 Zane Jeppesen executed a $500,000 promissory note (2001 Note) secured by trust deeds on the Alpine Property in favor of Harry and Shira McMurdie (the McMurdies/McMurdie IRA). The 2001 Note matured March 24, 2003 and permitted extensions/renewals by the holder.
Zane executed subsequent notes in 2003 and 2004 (2003 Note, 2004 Notes) that changed terms (amounts, interest) and listed the Alpine Property but no new trust deed was recorded; parties dispute whether those instruments extended or superseded the 2001 Note.
Zane was later criminally/administratively sanctioned and obtained a bankruptcy discharge in 2005; the McMurdies did not pursue foreclosure then and later were told by Zane his liens remained intact.
In 2011 (two days before a six-year limitations period would have lapsed), the parties signed a Modification Agreement extending the maturity to March 24, 2013; short extensions followed in 2013.
Zane quitclaimed the Alpine Property to his son, Luke Jeppesen, who filed a quiet title suit one day before a nonjudicial trustee’s foreclosure sale in July 2015; the district court granted summary judgment for Jeppesen based on the six-year statute of limitations.
On appeal the Utah Court of Appeals reversed and remanded, holding genuine issues of material fact exist about (1) whether the later instruments extended rather than superseded the 2001 Note and (2) whether equitable estoppel (imputed from Zane to Jeppesen) prevents assertion of the statute-of-limitations defense.

Issues

Issue	Plaintiff's Argument (Jeppesen)	Defendant's Argument (McMurdies)	Held
Whether subsequent instruments extended or superseded the 2001 Note (thus when statute began to run)	The later notes and agreements created new obligations that superseded the 2001 Note, so limitations ran earlier	The 2003/2004 notes and 2011 modification were intended to extend the original secured obligation, so limitations did not run until 2013	Reversed: fact issues exist about parties’ intent; summary judgment improper
Whether equitable estoppel or equitable discovery tolls limitations because Zane induced delay	Jeppesen asserted statute of limitations; district court found discovery rule inapplicable	McMurdies argue Zane’s assurances induced them to delay and estop Jeppesen from asserting the defense	Reversed: material factual disputes exist on equitable estoppel elements
Whether Zane’s conduct can be imputed to Jeppesen (successor in title)	Jeppesen is an innocent successor and can raise limitations	McMurdies assert sufficient connection (quitclaim conveyance, son filing suit at father’s direction) to impute father’s conduct	Reversed: disputed facts on relationship/course of conduct preclude summary judgment
Whether summary judgment was appropriate overall	Jeppesen: limitations barred foreclosure, no tolling/estoppel	McMurdies: factual disputes on extension/estoppel require trial	Reversed and remanded for trial or further proceedings

Key Cases Cited

First Sec. Bank of Utah v. Proudfit Sporting Goods Co., 552 P.2d 123 (Utah 1976) (new note does not extinguish original debt absent clear intent to supersede)
Johnson v. Home State Bank, 501 U.S. 78 (U.S. 1991) (bankruptcy discharge extinguishes personal liability but lienholder’s foreclosure rights survive)
Russell Packard Dev., Inc. v. Carson, 108 P.3d 741 (Utah 2005) (equitable discovery rule may toll statute of limitations when plaintiff could not reasonably know of cause of action)
Travelers Ins. Co. v. Kearl, 896 P.2d 644 (Utah Ct. App. 1995) (elements of equitable estoppel to bar a limitations defense)
Dansie v. Anderson Lumber Co., 878 P.2d 1155 (Utah Ct. App. 1994) (actions of defendant or its privies that induce delay may bar assertion of limitations)
Rice v. Granite Sch. Dist., 456 P.2d 159 (Utah 1969) (party cannot lull adversary into delay and then assert the statute of limitations)
Glen Allen Mining Co. v. Park Galena Mining Co., 296 P. 231 (Utah 1931) (discussion of privity in imputation contexts)