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Sons v. McManis

September 3, 2010



Doc. # 49

This is an action in diversity for fraud and unjust enrichment by plaintiff Bruce Sons ("Plaintiff") against defendant Jim McManus ("Defendant"). The action arises out of an alleged agreement between Plaintiff and Defendant to convey property owned by Plaintiff to Defendant to avoid imminent foreclosure. Pursuant to the alleged agreement, Defendant was to receive title to the property by quitclaim deed and was thereafter to use his assets to clear title to the property. Thereafter, Defendant was to reconvey approximately 2.5 acres of the 10-acre property to Plaintiff and to retain the remainder for himself. The property was ultimately sold by Defendant and no reconveyance took place. Plaintiff's First Amended Complaint ("FAC"), filed on January 30, 2009, alleges four claims for relief that are untitled but generally track the elements of claims under California common law for breach of fiduciary duty, breach of contract, unjust enrichment, and fraud. Following the court's decision on Defendant's motion to dismiss, Plaintiff's claims for fraud and unjust enrichment remain.

In the instant motion, Defendants move for summary judgment as to Plaintiff's remaining claims on the ground that the claims are barred by applicable statutes of limitations. For the reasons that follow, the court will grant in part and deny in part Defendant's motion.


The complaint in this action was originally filed on June 13, 2008. Defendant filed a motion to dismiss or, in the alternative, a motion for a more definite statement on October 15, 2008. On January 5, 2009, the court issued an order granting Defendant's motion to dismiss Plaintiff's claims for fraud and for breach of fiduciary duty; both dismissals were with leave to amend. The court's January 5 order dismissed Plaintiff's claim for fraud on the ground the claim was not set forth with sufficient particularity in violation of Rule 9(b) of the Federal Rules of Civil Procedure. Plaintiff filed the now-operative FAC on January 30, 2009. The FAC restated the same four claims that were alleged in the original complaint with minor modifications. Pursuant to an order by the Magistrate Judge for limited discovery and further briefing, the parties submitted briefs and responses on the issues of amount in controversy, statute of limitations, statute of frauds and res judicata effects of prior proceedings in small claims court.

On January 8, 2010, the court issued a memorandum opinion and order that construed the parties' briefs as a motion to dismiss pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure (the "January 8 Order"). The court's January 8 Order dismissed Plaintiff's contract claim and claim for breach of fiduciary duty, both with prejudice. Defendant's brief did not specifically address Plaintiff's fraud claim and the court did not find that Plaintiff's fraud claim was subject to dismissal on any of the other grounds argued. The court found that Plaintiffs claims were not barred by the amount in controversy and found that there was not sufficient information that the court could consider to permit a decision on Defendant's contentions with regard to statutes of limitations. After the court's January 8 Order, Plaintiff's claims for fraud and unjust enrichment remain.

The instant motion for summary judgment was filed on June 30, 2010. Plaintiff's opposition was filed on August 9, 2010, following a stipulated modification of the scheduling order. Defendant's reply was filed on August 16, 2010.


The following summarizes in narrative form Defendant's proffered undisputed material facts. Here, the "Property" refers to an approximately 10-acre parcel of land located in Bakersfield, California. "Dwight" refers to Plaintiff's brother, Dwight Sons. "Vincent" refers to Plaintiff's brother, Vincent Sons.

Plaintiff owned the Property which was in foreclosure and scheduled to be sold at a trustee's sale on May 10, 1994. Plaintiff and his brother, Dwight, decided to seek the assistance of Defendant with regard to the pending foreclosure on the Property before Dwight spoke to Defendant about the Property. Dwight approached Defendant with a proposal to arrange the transfer of the Property from Plaintiff to Defendant. The transfer was accomplished by quitclaim deed. At the time the Parcel was transferred from Plaintiff to Defendant, the two had never met or spoken directly to each other regarding the transfer, nor had they discussed any of the terms of the transfer. Plaintiff contends [in the complaint] that (1) the Property was to be subdivided by Defendant and (2) that Defendant would reconvey a 2.5-acre portion of the Property back to Plaintiff. Plaintiff alleges [in the complaint] that Plaintiff agreed to reimburse Defendant for all monies Defendant spent with regard to the property.*fn1 Plaintiff also contends that, after the transfer of the Property to Defendant, both parties intended that Plaintiff should continue living at the residence on the Property.*fn2

Plaintiff and his former wife, Linda Sons, transferred the Property [by quitclaim deed] to Defendant and his wife on May 10, 1994. Plaintiff was arrested on July 11, 1994 for fatally shooting a California Highway Patrolman on the same day. Plaintiff remained incarcerated until he was released in 2006. Plaintiff never reimbursed Defendant for any monies spent with regard to the Property.

On or about October 18, 1994, Defendant wrote a letter addressed to Dwight stating as follows:

In response to your request for a proposal for the [Property], the following offering will be in effect until January 18, 1995.

If a satisfactory response is not made by that date, the property will go on the open market.

The selling price of the total Property is $331,863.45. Debt service, taxes, and insurance will be prorated from this date until the date of sale. Also, any expenses incurred in maintaining the [P]roperty will be added to the selling price.

If water is not provided to the [P]roperty as previously agreed, the attorney fees, costs of litigation, [illegible] or drilling a well will be added to the selling price. If a satisfactory settlement is not made by the January 18, 1995, date, then any implied agreements will be null and void.

Doc. # 52 - 4 (hereinafter, the "Letter").

Defendant alleges the Letter was received by Dwight in 1994 and was received by Vincent in 1994. Defendant alleges, and Plaintiff denies that Plaintiff believed as of September 13, 1995, that Defendant had not reconveyed any portion of the Property to Plaintiff. Defendant also alleges that Dwight believed in 1994 that Defendant's Letter indicated that Defendant intended to renege on the alleged Deal. Defendant stated [in his ...

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