Ingvoldstad v. Estate of Young

19 V.I. 115, 1982 U.S. Dist. LEXIS 9253
CourtDistrict Court, Virgin Islands
DecidedMay 13, 1982
DocketCivil No. 80-262
StatusPublished
Cited by13 cases

This text of 19 V.I. 115 (Ingvoldstad v. Estate of Young) is published on Counsel Stack Legal Research, covering District Court, Virgin Islands primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Ingvoldstad v. Estate of Young, 19 V.I. 115, 1982 U.S. Dist. LEXIS 9253 (vid 1982).

Opinion

O’BRIEN, Judge

MEMORANDUM OPINION AND ORDER

Defendants have moved to dismiss the above captioned case on the grounds that it is barred by the V.I. six-year statute of limitations for actions on an express or implied contract, 5 V.I.C. § 31(3)(A), as well as by the general tort two-year statute in 5 V.I.C. § 31(5)(A). Plaintiff opposed the motion by arguing that the action is timely because the appropriate statute of limitations is the 10-year statute for a cause of action not otherwise provided for in § 31.1 Alternatively, plaintiff argued that the six-year statute for contract actions is applicable and that the suit was timely brought within six years of plaintiff’s discovery of defendants’ fraudulent conduct.

At oral argument held on April 30, 1982, counsel for both sides specifically requested guidance from the Court on the issue of the applicable statute of limitations for legal malpractice and breach of fiduciary duty. Counsel also agreed that in an action for fraud, the statute of limitations would commence at the time the alleged fraud was discovered or reasonably should have been discovered by plaintiff, pursuant to 5 V.I.C. § 32(c).2

[119]*119Defendants’ motion to dismiss will be denied so that the parties will be put to their proof regarding the dates the alleged causes of action in Counts I, II and III accrued and the date on which plaintiff discovered or reasonably should have discovered defendants’ fraud.

FACTS

In her First Amended Complaint (“Amended Complaint”), Mrs. Mable Ingvoldstad (“plaintiff”), the wife of the deceased Captain Chester Ingvoldstad (“Ingvoldstad”), alleges three causes of action against defendants Warren H. Young (“Young”), Ruth H. Young, James Isherwood (“Isherwood”), Sarah Isherwood, Phillip C. Clark, Meredith P. Clark and The Pentheny, Ltd.3 The first cause of action (“Count I”) has been brought against all the defendants but the second and third causes of action (“Counts II and III”) have been asserted only against Young and Isherwood. Plaintiff is successor to all of Ingvoldstad’s interests in both his real and personal property.

Count I is an action alleging fraudulent misrepresentation, nondisclosure and concealment of material facts, breach of oral contract and breach of fiduciary duty by Young and Isherwood with respect to property owned by Ingvoldstad located at 46 King Street in Christiansted, St. Croix. Ingvoldstad leased the property to Young for a term of 50 years, by executing a lease (the “Lease Agreement”) dated July 28, 1961, which Young had prepared. Young had previously performed legal services for Ingvoldstad and plaintiff on certain estate matters and, according to plaintiff, had been orally retained by Ingvoldstad to serve as his, and his wife’s, counsel.

During the period from 1961 to 1964, plaintiff alleges that Young and Isherwood, by making misrepresentations of material fact and failing to inform Ingvoldstad of facts, fraudulently induced him to sign various lease documents and mortgages.4 The Lease Agreement, as well as the other documents, were allegedly economically disadvantageous to Ingvoldstad, were intended to benefit the defendants and resulted in the Ingvoldstads’ loss of possession of the property for the duration of the 50-year lease. Plaintiff is requesting $750,000 in damages for loss of profits and rentals, $1.5 million in [120]*120punitive damages and rescission of the Lease Agreement and recovery of possession of the 46 King Street property.

In Count II, plaintiff basically alleges that Young and Isherwood breached their oral contractual relationship with, and violated their fiduciary duty to, plaintiff and Ingvoldstad by representing conflicting interests. Young and Isherwood represented both Ingvoldstad as landlord, and Wallace St. Croix, Inc., as original lessee, in the drafting of a lease commencing December 1, 1960, and subsequent amendments, for premises at 59 King Street, which lease terms proved “substantially disadvantageous” to Ingvoldstad. Plaintiff is seeking $2 million in lost profits and $5 million punitive damages.

Similar allegations of breach of oral contract and fiduciary relationship by Young and Isherwood’s representation of conflicting interests are made in Count III, with respect to the negotiation and preparation of a lease for property located at 55 King Street. The lease on this property, which was owned in part by Ingvoldstad, was signed on August 4,1961, and amended at various times. Lost profits in the amount of $750,000 and punitive damages for $1.5 million are sought to compensate plaintiff for this economically disadvantageous lease. Plaintiff claims that she did not discover Young and Isherwood’s conflicting representation regarding the 59 and 55 King Street leases until June 1979.

It appears that Ingvoldstad owned all of the properties in question and collected the rents thereon until January 22, 1969, on which date he transferred the properties to plaintiff. Ingvoldstad died in February 1969 and suit was commenced by plaintiff on November 4, 1980.

I. Fraudulent Misrepresentation, Nondisclosure and Concealment Are Torts and Are Subject to the Two-Year Statute of Limitations

In essence, Count I consists of two causes of action: fraud and legal malpractice. Fraud is premised on the alleged intentional misrepresentation, nondisclosure and concealment by Young and Isherwood of material facts which Ingvoldstad relied upon and which allegedly induced him to execute a number of documents regarding 46 King Street which were economically disadvantageous to him. The legal malpractice claim is treated at length in Point II and the discussion therein is intended to include the claim in Count I.

The Virgin Islands Code does not have a specific statute of limitations for fraud, as do many jurisdictions. Therefore, we must initially decide the type of action which fraud constitutes, and then apply the pertinent limitation period.

[121]*121The Restatements of Law, which in the absence of local laws to the contrary are deemed to be controlling in the Virgin Islands,5 have classified fraudulent misrepresentation as a tort.6 In addition, the foundation of a fraud action has consistently been held to be tort, not contract. Hood v. Hood, 335 F.2d 585, 590 (10th Cir.), cert. denied, 379 U.S. 915 (1964); see, also, Sedco International, S.A. v. Cory, 522 F.Supp. 254, 329 (S.D. Iowa 1981) (fraudulent misrepresentation deemed an intentional tort).

In light of the above, it is this Court’s finding that the portion of plaintiff’s first cause of action which alleges intentional misrepresentation, concealment and nondisclosure of material facts for the purpose of inducing Ingvoldstad’s reliance on them is a claim for fraud. Since fraud is considered a tort in the Virgin Islands, the general tort two-year statute of limitations in 5 V.I.C. § 31(5)(A) must be applied.

Plaintiff’s request for equitable relief in the form of rescission of the lease and restitution of the premises does not change our determination since rescission and restitution are simply remedies, not rights. See, Roberts v. Sears, Roebuck and Co., 617 F.2d 460, 464 (7th Cir.), cert.

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Arlington Funding Services, Inc. v. Geigel
51 V.I. 118 (Supreme Court of The Virgin Islands, 2009)
Montgomery v. Estate of Griffith
49 V.I. 255 (Superior Court of The Virgin Islands, 2008)
Hall v. Delta Air Lines, Inc.
340 F. Supp. 2d 596 (Virgin Islands, 2004)
Whitaker v. Merrill Lynch, Pierce Fenner & Smith, Inc.
36 V.I. 75 (Supreme Court of The Virgin Islands, 1997)
Phaire v. Galiber-Babb
26 V.I. 144 (Supreme Court of The Virgin Islands, 1991)
Joseph v. Hess Oil Virgin Islands Corp.
671 F. Supp. 1043 (Virgin Islands, 1987)
Edwards v. Groner
23 V.I. 265 (Virgin Islands, 1987)
Lawaetz v. Bank of Nova Scotia
653 F. Supp. 1278 (Virgin Islands, 1987)
Hobson v. Government of the Virgin Islands Fire Division
22 V.I. 87 (Supreme Court of The Virgin Islands, 1986)
Moorehead v. Miller
21 V.I. 79 (Virgin Islands, 1984)
Fountain Valley Corp. v. Wells
19 V.I. 607 (Virgin Islands, 1983)
Simmons v. Ocean
544 F. Supp. 841 (Virgin Islands, 1982)

Cite This Page — Counsel Stack

Bluebook (online)
19 V.I. 115, 1982 U.S. Dist. LEXIS 9253, Counsel Stack Legal Research, https://law.counselstack.com/opinion/ingvoldstad-v-estate-of-young-vid-1982.