Savings Clause of § 6-2-3 – Fraud Claim – Statute of Limitations

Price v. Alabama One Credit Union, et al., [Ms. SC-2022-1013, Oct. 27, 2023] So. 3d__(Ala. 2023). The Court (Parker, C.J., and Shaw, Bryan, Mendheim, Stewart, Mitchell, and Cook, JJ., concur; Sellers, J., concurs in the result; Wise, J., recuses) affirms the Tuscaloosa Circuit Court’s summary judgment dismissing Walter Price’s (“Price”) fraud action against Alabama One Credit Union and William A. Lunsford (“the defendants”).

On July 15, 2009, Price and the defendants entered into a real estate transaction conveying their respective interests in the subject property. On December 28, 2014, Price commenced this action against the defendants, alleging that the defendants conspired to divest Price of his interest through fraud. The circuit court determined that all of Price’s claims against the defendants were barred by the two-year limitations period imposed by § 6-2-38, Ala. Code 1975.

On appeal, Price argues that § 6-2-3, Ala. Code 1975 saves his claims. The Court disagrees and reiterates:

“[Section] 6-2-3 does not ‘save’ a plaintiff’s fraud claim so that the statutory limitations period does not begin to run until that plaintiff has some sort of actual knowledge of fraud. Instead, under Foremost [Insurance Co. Parham], 693 So. 2d 409, 417-21 (Ala. 1997)], the limitations period begins to run when the plaintiff was privy to facts which would ‘provoke inquiry in the mind of a [person] of reasonable prudence, and which, if followed up, would have led to the discovery of the fraud.’ Willcutt v. Union Oil Co., 432 So. 2d 1217, 1219 (Ala. 1983) (quoting Johnson v. Shenandoah Life Ins. Co., 291 Ala. 389, 397, 281 So. 2d 636 (1973)); see also Jefferson County Truck Growers Ass’n v. Tanner, 341 So. 2d 485, 488 (Ala. 1977)(‘Fraud is deemed to have been discovered when it ought to have been discovered. It is sufficient to begin the running of the statute of limitations that facts were known which would put a reasonable mind on notice that facts to support a claim of fraud might be discovered upon inquiry.’).”

Ms. *11, quoting Auto-Owners Ins. Co. v. Abston, 822 So. 2d 1187, 1195 (Ala. 2001), emphasis in Abston.

With respect to Price, the Court concludes that Price did, in fact, inquire about irregularities in the July 15, 2009, transaction that same day and that, if Price had followed up on those inquiries, he could have discovered the defendants’ alleged fraud within the limitations period. Ms. **12-13. Thus, because Price did not commence this action until 2014, his claims are barred.

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