Opinion
Case No. 3:16-cv-2650-SAL
2020-09-09
Paige MARTINEAU, Plaintiff, v. Joel WIER, Diane Wier, and Richard Guest, Defendants.
Paige Martineau, Grantham, NH, pro se. Bess Jones DuRant, Thornwell Forrest Sowell, III, Sowell and DuRant LLC, Columbia, SC, for Defendants Joel Wier, Richard Guest. Bess Jones DuRant, Sowell and DuRant LLC, Columbia, SC, for Defendant Diane Wier.
Paige Martineau, Grantham, NH, pro se.
Bess Jones DuRant, Thornwell Forrest Sowell, III, Sowell and DuRant LLC, Columbia, SC, for Defendants Joel Wier, Richard Guest.
Bess Jones DuRant, Sowell and DuRant LLC, Columbia, SC, for Defendant Diane Wier.
OPINION AND ORDER
SHERRI A. LYDON, United States District Judge
On October 13, 2009, Plaintiff Paige Martineau was the victim of a knife attack at the hands of Defendant Richard Guest. Defendants Joel and Diane Weir are Guest's relatives who owned the apartment building where the attack occurred and where they provided Guest a place to live. Plaintiff settled her claims against Mr. Guest and the Wiers in October of 2012. She now seeks, however, to rescind the settlement agreement as fraudulently induced.
Plaintiff, proceeding pro se , filed this action on July 27, 2016, against Guest in addition to Joel and Diane Wier (collectively, "Defendants"). The Complaint alleges that Guest is mentally ill and that the Wiers knew of Guest's propensity for violence prior to the attack. Plaintiff further alleges she was fraudulently induced to settle her claims by the Wiers’ deceit regarding their knowledge of Guest's disposition, and the Complaint alleges seven state law tort claims against Defendants in connection with the attack.
This matter is now before the Court on remand from the Fourth Circuit, which vacated this Court's prior grant of summary judgment in favor of Defendants. The Court previously granted summary judgment for Defendants based on judicial estoppel, as Plaintiff did not disclose the instant claims as an asset in bankruptcy. See ECF No. 68. On remand, Defendants have re-briefed the arguments not reached by the district court in granting their first dispositive motion. ECF No. 70. Plaintiff filed a response on November 18, 2019, ECF No. 72, and Defendants filed a reply. ECF No. 75. This matter is accordingly ripe for consideration.
Initially filed as a motion to dismiss, the Court converted Defendant's first dispositive motion into one for summary judgment pursuant to Rule 12(d) of the Federal Rules of Civil Procedure. See ECF No. 29.
I. Factual Background and Procedural History
A. Plaintiff's Claims Arising out of the Attack
In 2009, Plaintiff was a senior at the University of South Carolina. On October 13th of that year, she was alone at her former boyfriend's apartment building when she was attacked with a knife by Richard Guest, who lived in the apartment below. Guest was arrested and charged with kidnapping as well as assault and battery with intent to kill; however, he was determined incompetent to stand trial. The Complaint asserts claims for intentional infliction of emotional distress, assault, and battery against Guest in connection with the attack.
Plaintiff alleges that Defendants Joel and Diane Wier owned the apartment building where the attack occurred, and Plaintiff submits that Joel and Diane Wier possessed extensive knowledge of Guest's mental illness and dangerous propensities prior to the attack upon Plaintiff. Specifically, Plaintiff alleges that Diane Wier is the trustee of a "mental health trust" for the benefit of Guest. Diane Wier also allegedly attempted to have Guest involuntarily committed at a facility in France some months before the attack. Finally, Plaintiff alleges that both Joel and Diane Wier were aware of poems, authored by Guest, about "bloody stabbings." In possessing this knowledge, Plaintiff alleges that Joel and Diane Wier exhibited various forms of negligence and gross negligence by assuming yet failing to discharge the duties associated with caring for a dangerous and mentally ill relative. Importantly, Plaintiff contends that she did not learn of the Wiers’ knowledge of Guest's disposition until after she signed a release of all claims she has asserted in this action.
B. The October 2012 Settlement Agreement
Nearly four years prior to filing this lawsuit and more than three years after the attack occurred, Plaintiff–then represented by counsel–executed a settlement and release of all claims arising out of the attack. ECF No. 21-2. The release is dated October 22, 2012, and purports to release Defendants from all damages "on account of, or in any way resulting from, or in connection with an assault on October 13, 2009." ECF No. 21-2 at 1. Attached to the release is the incident report, detailing the attack for which Plaintiff released Defendants from liability and which forms the basis of seven of Plaintiff's eight causes of action. Id. at 4-6. Plaintiff does not dispute that the release, if binding, renders this lawsuit subject to dismissal. Instead, Plaintiff alleges in her first cause of action that the release was fraudulently induced and, therefore, subject to rescission.
The Court considers the release as a document attached to Defendants’ motion to dismiss and which is expressly referred to in the Complaint. ECF No. 1 at ¶ 55 ("Plaintiff Paige Martineau ... entered into a settlement ... with Richard Harold Guest, Diane Wier, and Joel Wier."); Powe v. City of Chicago , No. 95 C 1708, 1996 WL 99711, at *3 (N.D. Ill. Mar. 4, 1996) (considering release attached to motion to dismiss where the plaintiff "conceded in her complaint that she entered into the Settlement Agreement with the defendant.").
In support of this argument, Plaintiff alleges that during settlement negotiations, "Joel and Diane Wier represented to Plaintiff Martineau that they had no knowledge of Richard Harold Guest's mental illness or potential dangerousness." ECF No. 1 at ¶ 17. Joel Wier allegedly first made representations to this effect in response to direct questioning during a phone call with Plaintiff in the summer of 2012, some time after June 20th. See id. at ¶¶ 13, 16, 18-22; see also ECF No. 24 at 11. Plaintiff submits these statements fraudulently induced her to enter the settlement agreement, as evidence of the Wiers’ prior knowledge of Guest's dangerousness would have increased the value of Plaintiff's disputed claims against the Wiers.
Plaintiff learned the representations were false, she alleges, when she "learned that there were additional documents in the case." Id. at ¶ 24. Specifically, on December 30, 2013, Plaintiff obtained access to the criminal file associated with Guest's prosecution. Plaintiff submits these documents establish the Wiers’ knowledge of Guest's mental illness and dangerous propensities. Id. at ¶ 25-27; see also ECF No. 72 at 6 ("[Plaintiff] was unable to obtain this information before because it was in a confidential file that the prosecutor had declined to show her ...."). Accordingly, Plaintiff now contends that the October 22, 2012 settlement was fraudulently induced and does not bar her underlying tort claims against the Wiers and Guest in connection with the attack.
C. Plaintiff's 2015 Bankruptcy Proceedings and Appeal
On June 29, 2015, before she filed this action, Plaintiff filed a petition for relief under Chapter 7 of the Bankruptcy Code. ECF No. 21-3; In re Paige Jacqueline Martineau , C/A No. 4:15-bk-02767-JJT (Bankr. M.D. Pa. 2015). In doing so, Plaintiff did not list the claims she now asserts against Defendants as an asset. ECF No. 21-3 at 9 (listing only one unrelated claim against a landlord). On November 15, 2016, however–shortly after Defendants raised a judicial estoppel argument in this case–Plaintiff amended her bankruptcy disclosures to include the instant claims. The claims were subsequently exempted from Plaintiff's bankruptcy estate, and the bankruptcy court closed her reopened case on February 21, 2017. Nevertheless, Plaintiff's initial failure to list the causes of action she now asserts formed the basis for this Court's now-vacated grant of summary judgment in favor of Defendants. ECF No. 52. The Court previously held that (1) only the bankruptcy trustee had Article III standing to bring this action at the time it was filed, and (2) Plaintiff was judicially estopped from asserting claims that she did not initially disclose to the bankruptcy court.
On appeal, the Fourth Circuit held that Plaintiff did have Article III standing to sue and that Plaintiff's bankruptcy only implicated whether Plaintiff was the real party in interest. Martineau v. Wier , 934 F.3d 385, 392 (4th Cir. 2019). In addition, the Fourth Circuit vacated and remanded for further consideration the propriety of applying judicial estoppel in light of all facts and circumstances bearing on Plaintiff's intent to mislead the courts. See id. at 393.
After this action was remanded, Defendants re-briefed several bases for dismissing Plaintiff's claims pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure. They assert, among other things, that Plaintiff's underlying tort claims are all barred by the applicable three-year statute of limitations, which ran on October 13, 2012, and Plaintiff's remaining claim for fraudulent inducement fails to plausibly show damages. Plaintiff responds, in part, by arguing that the Wiers’ fraud tolls the statute of limitations. The parties agree that the fraud claim is timely, but Plaintiff does not address the issue of whether her fraud claim plausibly shows entitlement to relief if her remaining claims are barred by the statute of limitations.
After a careful review of the record, the parties’ arguments, the Fourth Circuit's opinion, and the applicable law, the Court declines to apply the doctrine of judicial estoppel to bar Plaintiff's claims. The Complaint, however, establishes that the statute of limitations has run on Plaintiff's underlying tort claims, and the Court cannot identify a plausible theory of recovery on Plaintiff's fraudulent inducement claim. Accordingly, Defendants’ motion to dismiss is granted. II. Legal Standard
Under Fed. R. Civ. P. 12(b)(6), a party may move to dismiss for "failure to state a claim upon which relief can be granted." When considering a Rule 12(b)(6) motion, the Court must accept the plaintiff's factual allegations as true and draw all reasonable inferences in the plaintiff's favor. See E.I. du Pont de Nemours & Co. v. Kolon Indus. , 637 F.3d 435, 440 (4th Cir. 2011). The Court need not, however, accept the plaintiff's legal conclusions. Ashcroft v. Iqbal , 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009). On a motion to dismiss, the Court's task is limited to determining whether the complaint states a "plausible claim for relief." Id. at 679, 129 S.Ct. 1937. Although Rule 8(a)(2) requires only a "short and plain statement of the claim showing that the pleader is entitled to relief," a "formulaic recitation of the elements of a cause of action will not do." Bell Atl. Corp. v. Twombly , 550 U.S. 544, 555, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007). To survive a motion to dismiss under Rule 12(b)(6), a complaint must contain "sufficient factual matter, accepted as true, to ‘state a claim to relief that is plausible on its face.’ " Iqbal , 556 U.S. at 678, 129 S.Ct. 1937 (quoting Twombly , 550 U.S. at 570, 127 S.Ct. 1955 ).
In ruling on a motion to dismiss pursuant to Rule 12(b)(6), a court may consider, without converting the motion into one for summary judgment under Rule 12(d), documents attached to the complaint. See Sec'y of State for Def. v. Trimble Navigation Ltd. , 484 F.3d 700, 705 (4th Cir. 2007). A court may also consider documents attached to a defendant's motion to dismiss if the document is "integral to and explicitly relied on" in the complaint, provided the plaintiff does not challenge the authenticity of the document. Am. Chiropractic Ass'n v. Trigon Healthcare, Inc. , 367 F.3d 212, 234 (4th Cir. 2004).
III. Discussion
The Court first addresses the issue on remand from the Fourth Circuit, i.e. , whether Plaintiff should be judicially estopped from asserting her claims because she initially failed to disclose them as an asset before the bankruptcy court in 2015. Finding no risk to judicial integrity in light of Plaintiff's amended filings with the bankruptcy court, the Court finds judicial estoppel inappropriate in this case. Even so, the Court agrees that all of Plaintiff's tort claims arising out of the October 13, 2009 attack are brought beyond expiration of the statute of limitations, and the only remaining claim for fraudulent inducement does not plausibly show an entitlement to relief. The Court, therefore, grants Defendants’ motion.
A. The Facts and Circumstances Surrounding Plaintiff's Bankruptcy Proceeding do not Warrant Application of Judicial Estoppel.
The Court declines to apply judicial estoppel to bar Plaintiff from pursuing her claims in this action, because Plaintiff ultimately realized no success in persuading the bankruptcy court to accept an inconsistent position. Plaintiff amended her bankruptcy schedules as soon as the issue was raised by Defendants. There is no risk of inconsistent judicial determinations as between this action and Plaintiff's bankruptcy case, and Plaintiff would have no unfair advantage and Defendants would suffer no unfair detriment if Plaintiff is not judicially estopped.
The doctrine of judicial estoppel "precludes a party from adopting a position that is inconsistent with a stance taken in prior litigation." Lowery v. Stovall , 92 F.3d 219, 223 (4th Cir. 1996) (quoting John S. Clark Co. v. Faggert & Frieden, P.C. , 65 F.3d 26, 28-29 (4th Cir. 1995) ). The purpose is to prevent parties from "playing fast and loose with the courts and to protect the essential integrity of the judicial process." Id. The circumstances under which application of judicial estoppel are appropriate, however, "are probably not reducible to any general formulation of principle." New Hampshire v. Maine , 532 U.S. 742, 750, 121 S.Ct. 1808, 149 L.Ed.2d 968 (2001) (quoting Allen v. Zurich Ins. Co. , 667 F.2d 1162, 1166 (4th Cir. 1982) ).
In New Hampshire v. Maine , the Supreme Court of the United States distilled three factors for courts to consider when analyzing whether to apply the doctrine of judicial estoppel. Id. at 750-51, 121 S.Ct. 1808. First, the party against whom judicial estoppel is to be applied must be taking a factual position that is "clearly inconsistent" with an earlier position. Id. at 750, 121 S.Ct. 1808 ; see also Zinkand v. Brown , 478 F.3d 634, 638 (4th Cir. 2007). Second, a court should look to whether the party "succeeded in persuading a court to accept" the earlier position. Id. Without such success, the risk of a "perception that either the first or the second court was misled" is averted. See id. (quoting Edwards v. Aetna Life Ins. Co. , 690 F.2d 595, 599 (6th Cir. 1982) ). The third enumerated consideration is "whether the party seeking to assert an inconsistent position would derive an unfair advantage or impose an unfair detriment on the opposing party if not estopped." Id. at 751, 121 S.Ct. 1808 (citations omitted). This third consideration carries with it an inquiry into whether the party to be estopped intentionally misled the court. Whitten v. Fred's, Inc. , 601 F.3d 231, 241 (4th Cir. 2010), abrogated on other grounds by Vance v. Ball State Univ. , 570 U.S. 421, 133 S.Ct. 2434, 186 L.Ed.2d 565 (2013). These considerations are not "inflexible prerequisites," nor do they constitute an "exhaustive formula" for determining the propriety of applying judicial estoppel in a particular case. Id.
"Judicial estoppel has often been applied to bar a civil lawsuit brought by a plaintiff who concealed the existence of the legal claim from creditors by omitting the lawsuit from his bankruptcy petition." Whitten , 601 F.3d at 241 (citing Cannon-Stokes v. Potter , 453 F.3d 446, 448 (7th Cir. 2006) (joining six appellate courts in holding that a debtor cannot realize on a legal claim he or she denies owning before the bankruptcy court)).
Focusing on the contested and "determinative" factor of Plaintiff's intent to mislead, see Zinkand , 478 F.3d at 638, the Court previously applied what amounted to a presumption of bad faith under In re Coastal Plains, Inc. , 179 F.3d 197 (5th Cir. 1999), where Plaintiff had knowledge of her claims at the time of her bankruptcy filing. In In re Coastal Plains , the Fifth Circuit set forth a standard for determining whether to apply judicial estoppel in the bankruptcy context: "the debtor's failure to satisfy its statutory disclosure duty is ‘inadvertent’ only when, in general, the debtor either lacks knowledge of the undisclosed claims or has no motive for their concealment." Id. at 210. The Fourth Circuit in this case joined two others in rejecting the presumption of bad faith applied in In re Coastal Plains . Martineau , 934 F.3d at 394 ; see also Slater v. United States Steel Corp. , 871 F.3d 1174, 1180 (11th Cir. 2017) (overruling precedent providing that omission of known civil claims in bankruptcy filings automatically saddled plaintiffs with intent in favor of "totality of the facts and circumstances" test); Ah Quin v. Cty. Of Kauai Dep't of Transp. , 733 F.3d 267, 276-77 (9th Cir. 2013) (rejecting presumption of bad faith and requiring courts to look beyond knowledge of a claim towards a plaintiff's subjective intent to mislead).
Here, Plaintiff did–although not until confronted with Defendant's judicial estoppel argument–reopen her bankruptcy case and disclose her claims. As noted in Ah Quin , this means two out of three factors from New Hampshire v. Maine suggest judicial estoppel should not be applied. Plaintiff is no longer taking inconsistent factual positions, and the bankruptcy court ultimately did not accept Plaintiff's initial position. See Ah Quin , 733 F.3d at 274. At this stage, Plaintiff will not have any unfair advantage, and Defendants will suffer no unfair detriment if Plaintiff is not estopped. This Court's acknowledgement of Plaintiff's claims cannot now be inconsistent with resolution of Plaintiff's bankruptcy case, even though Plaintiff initially represented to the bankruptcy court by omission that these claims did not exist.
Of course, as the Magistrate Judge noted in recommending that judicial estoppel be applied, allowing such late disclosure to the bankruptcy court might "promote a public policy that encourages nondisclosure unless and until a debtor is caught having concealed assets." ECF No. 40 (citing Love v. Tyson Foods, Inc. , 677 F.3d 258, 265-66 (5th Cir. 2012) ). Any incentive arguably created by declining to apply judicial estoppel, however, is sufficiently counterbalanced by potentially severe penalties associated with concealment of assets in bankruptcy in the first instance. See Fed. R. Bankr. P. 9011(c) (sanctions) ; 11 U.S.C. § 350(b) (allowing bankruptcy courts to reopen proceedings for cause); 18 U.S.C. § 152 (proscribing concealment of assets in bankruptcy proceedings and providing criminal penalties); 18 U.S.C. § 1621 (perjury).
Plaintiff is a licensed attorney, and "the importance of full and honest disclosure cannot be overstated." Ryan Operations G.P. v. Santiam-Midwest Lumber Co. , 81 F.3d 355, 362 (3d Cir. 1996) (citation omitted). At this stage, however, the Court can only determine that Plaintiff knew of her potential cause of action when she filed for bankruptcy and that she failed to disclose her claims even after she filed this suit. Even so, "[i]t is not difficult to imagine that ... those proceeding pro se ," Slater , 871 F.3d at 1186 –as Plaintiff did, just a few years out of law school at most–might fail to comply with a disclosure obligation without intentionally misleading the courts.
Without additional evidence bearing on the issue of Plaintiff's intent to mislead, and where two out of three considerations enumerated in New Hampshire v. Maine countenance against application of judicial estoppel, the Court denies Defendant's motion on this point.
B. All of Plaintiff's Underlying Tort Claims Arising out of the Attack are Brought Beyond Expiration of the Statute of Limitations.
Plaintiff has failed to carry her burden to establish that the three-year statute of limitations associated with her claims arising out of the attack should be tolled for enough time to survive a motion to dismiss on this issue. Because neither the Complaint nor argument from Plaintiff provide the Court any basis to find the underlying claims timely, the Court grants Defendants’ motion to dismiss as to such claims.
The statute of limitations begins to run when a cause of action accrues, i.e. , when it "reasonably ought to have been discovered." Dean v. Ruscon Corp. , 321 S.C. 360, 468 S.E.2d 645, 647 (1996). In other words, the statute begins to run when a plaintiff has notice that he might have a remedy for a harm. Id. "The injured party must act with some promptness where the facts and circumstances of an injury place a reasonable person of common knowledge and experience on notice that a claim against another party might exist." Id. The statute of limitations begins to run from this point of notice, "not when advice of counsel is sought or a full-blown theory of recovery developed." Wiggins v. Edwards , 314 S.C. 126, 442 S.E.2d 169, 170 (1994) (quoting Snell v. Columbia Gun Exchange, Inc. , 276 S.C. 301, 278 S.E.2d 333, 334 (1981) ).
Here, Plaintiff's claims against Guest began to run when Guest stabbed her. There are no facts to justify tolling Plaintiff's claims against him. Although Plaintiff asks the Court to toll the statute as to Guest on the basis of his mental illness, she provides no authority for this proposition, and, although the Court assumes Guest has been deemed incompetent to stand trial in the related criminal matter, the Complaint does not allege whether Guest has the present legal capacity to be sued civilly. This appears to be an issue, if at all, of whether Guest may be sued in his own name. See Fed. R. Civ. P. 17.
As to Plaintiff's claims against the Wiers arising out of the attack, the Court is unable to conclude that Plaintiff was misled for enough time to justify tolling the statute for nearly four years–as would be required to make any of these claims timely.
The statute of limitations may be tolled where the defendant has "wrongfully deceived or misled the plaintiff in order to conceal the existence of a cause of action." Crocker v. S.C. Dep't of Health & Envtl. Control , 428 S.C. 1, 9, 831 S.E.2d 924, 929 (S.C. Ct. App. 2019) (quoting English v. Pabst Brewing Co. , 828 F.2d 1047, 1049 (4th Cir. 1987) ) "[E]quitable tolling is a doctrine that should be used sparingly and only when the interests of justice compel its use." Hooper v. Ebenezer Senior Servs. & Rehab. Ctr. , 386 S.C. 108, 687 S.E.2d 29, 33 (2009). In addition, "[t]he party claiming the statute of limitations should be tolled bears the burden of establishing sufficient facts to justify its use." Id. at 32.
The Defendants argue that Plaintiff had a duty to investigate whether she had viable claims against the Wiers. In response, Plaintiff states that she "was unable to obtain" information about the Wiers’ relationship to Guest "because it was in a confidential file that the prosecutor had declined to show her." ECF No. 72 at 6. This is simply not the standard for objective due diligence. Although the criminal file purportedly contained a trove of information helpful to Plaintiff's case against the Wiers, the statute of limitations runs not when all facts are known and a full theory developed, but when a reasonable person of common knowledge and experience would be on notice that a claim might exist. See Dean , 468 S.E.2d at 647. Plaintiff's argument expressly assumes that it was impossible to know that the Wiers might face liability but for the information in the criminal case file. Not every civil plaintiff has the benefit of law enforcement investigative efforts, and Plaintiff does not mention any effort undertaken prior to her call with Joel Wier to develop the facts of a potential claim. Even drawing reasonable inferences in Plaintiff's favor, the fact that Plaintiff knew enough to "ask[ ] Joel Wier directly what he knew," ECF No. 24-2 at 11, all but establishes Plaintiff was previously on "notice that a claim against another party might exist."
Even assuming that the Wiers’ representations were sufficient to toll the statute of limitations, Plaintiff's Complaint establishes that she was deceived, at most, for approximately eighteen months. The incident and commencement of this action, on the other hand, are separated by nearly seven years. The attack upon Plaintiff occurred on October 13, 2009. In the Complaint, Plaintiff alleges that Defendant Joel Wier first made a false statement regarding the Wiers’ knowledge of Richard Guest's propensities in the summer of 2012, sometime after June 20th. See ECF No. 1 at ¶¶ 13, 16-18. Plaintiff submits she did not learn the falsity of this and subsequent statements until she obtained access to the criminal case file associated with Richard Guest on December 30, 2013. Id. at ¶¶ 24-25. Plaintiff did not file the Complaint in this action until July 27, 2016. Assuming for the benefit of Plaintiff at this stage that the Court should toll the statute, if at all, from June 20, 2012, Plaintiff was still only "deceived or misled" between June 20, 2012 and December 30, 2013. The Court finds no evidence or argument from Plaintiff to support tolling the statute from the date of the incident to June 20, 2012, or from December 30, 2013 until the Complaint was filed. This time period is more than five years and three months–substantially longer than the three-year statute of limitations applicable to Plaintiff's tort claims arising out of the attack. The Court finds all of Plaintiff's tort claims arising out of the attack to be time-barred.
C. Plaintiff's Fraudulent Inducement Claim Fails to Show a Plausible Entitlement to Relief, as Rescinding the Settlement Agreement Would Only Provide Plaintiff the Right to Assert Claims which are Otherwise Barred by the Statute of Limitations.
Plaintiff cannot establish a plausible theory of recovery on her remaining claim for fraudulent inducement, because rescission of the October 2012 release would only remove a contractual barrier to Plaintiff's maintenance of claims that are otherwise time-barred. Further, to the extent Plaintiff prays for actual, nominal, and punitive damages, ECF No. 1 at ¶ 61, the Court still cannot identify any damages not solely attributable to barred claims.
As an alternative to rescission, a defrauded party may elect to affirm the contract and recover damages. First Equity Inv. Corp. , 386 S.E.2d at 249 (citing Turner v. Carey , 227 S.C. 298, 87 S.E.2d 871, 874 (1955) ). Here, Plaintiff's claims are subject to dismissal in the event she wishes to proceed under a theory to collect damages. In doing so, she must, as a matter of law, affirm the entire settlement agreement, which would then operate to bar every claim asserted in this case because of the release provisions.
Rescission of a contract entitles the parties to be returned to the status quo ante. First Equity Inv. Corp. v. United Serv. Corp. , 299 S.C. 491, 386 S.E.2d 245, 248 (1989). Upon rescission, a party is entitled to "return of the consideration paid as well as any additional sums necessary to restore him to the position occupied prior to the making of the contract." Ellie, Inc. v. Miccichi , 358 S.C. 78, 594 S.E.2d 485, 494 (S.C. Ct. App. 2004) (citing Bank of Johnston v. Jones , 141 S.C. 98, 139 S.E. 190, 196 (1927) ). Although rescission seeks to create a situation "the same as if no contract ever had existed," id. (citations omitted), the court cannot locate any authority that allows a plaintiff, upon rescission of a release and settlement, to rewind the limitations clock on claims barred by the release. To the contrary, several courts have rejected this theory. See Munoz v. Witt , No. 10-07-00010-CV, 2008 WL 3971683, at *1 (Tex. App. Aug. 27, 2008) (rejecting proposition that rescission of a settlement agreement revives an expired statute of limitations); see also Rashid v. United States , 170 F. Supp. 2d 642, 648 (S.D.W. Va. 2001) (acknowledging that it would be "impossible for the court to restore the parties to the status quo ante" by rescinding a settlement agreement where applicable statutes of limitations had run), aff'd , 48 F. App'x 892 (4th Cir. 2002) ; Schmucker v. Naugle , 426 Pa. 203, 231 A.2d 121, 123 (1967) (affirming directed verdict for defendant where a settlement agreement, release, and subsequent disaffirmance "in no way tolled or stopped the statute of limitations from running against the claim from the date the cause of action accrued."). Of course, a party is free to negotiate for a provision tolling the statute of limitations. See Derrickson v. Circuit City Stores, Inc. , 84 F. Supp. 2d 679, 685 (D. Md. 2000) ("Agreements to toll applicable statutes of limitations are not unusual and are generally upheld.") (citations omitted).
Rescinding the settlement agreement would require the parties to return their respective consideration, i.e. , Defendants would be entitled to a return of $20,000, and Plaintiff would be entitled to assert causes of action against Defendants in connection with the attack. Even so, as discussed above, all of the underlying tort claims that Plaintiff would be entitled to assert are barred by the statute of limitations. With or without the release, Plaintiff would be in the same position. It is "impossible for the court to restore the parties to the status quo ante" because of Plaintiff's delay in filing suit. See Rashid , 170 F. Supp. 2d at 648. Further, as rescission is an equitable remedy, the Court declines to permit Plaintiff to avoid the clear import of the statute of limitations in this case.
The Court may assume without deciding that Plaintiff's factual allegations amount to a fraud by the Wiers sufficient to justify rescission; however, even when a party is entitled to disaffirm a settlement agreement, an expired statute of limitations can still, as it does here, pose an insurmountable obstacle to maintenance of the underlying claims. See Schmucker , 231 A.2d at 123.
For the foregoing reasons, the Court finds no plausible theory of recovery for Plaintiff to maintain her claim for fraud in the inducement of a settlement agreement: electing a damages remedy requires Plaintiff to affirm that Defendants are released from liability, and electing a rescission remedy is incapable of returning the parties to the status quo ante because the statute of limitations on the underlying tort claims has run.
IV. Conclusion
After a thorough review of the record, the parties’ arguments, and the applicable law, the Court declines to apply the doctrine of judicial estoppel to preclude Plaintiff from maintaining this action. The factual allegations of the Complaint, however, establish that Plaintiff's claims for negligence, gross negligence, intentional infliction of emotional distress, negligent supervision, negligent entrustment, assault, and battery are all brought beyond expiration of the statute of limitations. In addition, the Court cannot identify any plausible theory of recovery upon which Plaintiff can maintain her remaining claim for fraudulent inducement of a settlement agreement. Accordingly, the Court GRANTS Defendants’ Second Motion to Dismiss, ECF No. 70, and this action is DISMISSED with prejudice.
IT IS SO ORDERED.