Opinion
B322821
04-18-2024
R. R. CRANE INVESTMENT CORPORATION, INC., Cross-Complainant and Appellant, v. BRIAN W. CRANE, Cross-Defendant and Respondent.
Ogden & Motley and Dale E. Motley; Buchalter, George J. Stephan, Harry W.R. Chamberlain II and Efrat M. Cogan for Cross-Complainant and Appellant. Akerman and Caroline H. Mankey for Cross-Defendant and Respondent.
NOT TO BE PUBLISHED
APPEAL from a judgment of the Superior Court of Los Angeles County No. BC683006, Robert B. Broadbelt III, Judge.
Ogden & Motley and Dale E. Motley; Buchalter, George J. Stephan, Harry W.R. Chamberlain II and Efrat M. Cogan for Cross-Complainant and Appellant.
Akerman and Caroline H. Mankey for Cross-Defendant and Respondent.
MARTINEZ, J.
INTRODUCTION
Defendant and cross-complainant R. R. Crane Investment Corporation, Inc. (R. R. Crane) appeals from a judgment entered after the trial court granted the summary judgment motion of plaintiff and cross-defendant Brian Crane (Brian) on statute of limitations grounds. R. R. Crane's cross-complaint against Brian alleged five causes of action, seeking repayment of loans it made to him. The trial court ruled R. R. Crane's cross-claims were time-barred because Brian denied he owed any debt to the company in 2008 and, at the latest, the statute of limitations for R. R. Crane's claims expired in 2011, well before the crosscomplaint was filed in 2018. We reverse because R. R. Crane has adduced evidence creating a material factual dispute regarding when the statute of limitations accrued.
For ease of reference and meaning no disrespect, we refer to members of the Crane family by their first names.
FACTUAL AND PROCEDURAL BACKGROUND
R. R. Crane is a family-owned corporation formed in 1960 by the parents of Kevin, Brian, and Patrick Crane. The corporation primarily functions as a holding company for stock and real estate investments made by the parents. Initially, three separate trusts benefitting each of the brothers held equal shares of R. R. Crane. In 2014, the brothers settled a lawsuit initiated by Patrick against Kevin and Brian in probate proceedings. As part of the settlement, Patrick relinquished his shares of R. R. Crane to Kevin and Brian, who then each owned 50 percent of the company.
Because the brothers' interests are aligned with their trusts, when we refer to a brother by name we include his respective trust.
Patrick is not a party to this appeal.
A. Brian Seeks Dissolution of R. R. Crane, and R. R. Crane Files a Cross-Complaint Seeking Repayment of the Debt from Brian
This is the parties' second appeal before this court. We briefly summarize the initial litigation leading to the previous appeal. A more extensive discussion of the procedural background may be found in Crane v. R. R. Crane Investment Corp. (2022) 82 Cal.App.5th 748.
In 2017 Brian sued R. R. Crane, seeking its dissolution and the liquidation of its assets pursuant to Corporations Code section 1800.
On January 5, 2018 Kevin and R. R. Crane filed a crosscomplaint against Brian, alleging Kevin had the right to purchase Brian's shares of R. R. Crane to prevent dissolution under Corporations Code section 2000. The cross-complaint also alleged Brian owed the company over $1.2 million for loans it made to him between 1989 and 1999. In the operative first amended cross-complaint, R. R. Crane alleged five causes of action for money lent, money due on an account stated, money due on an open book account, breach of contract, and breach of fiduciary duty. R. R. Crane alleged the series of loans to Brian totaled $1,207,467.87 with interest accruing at a rate based on the Index of Applicable Federal Rates established by the Internal Revenue Service. The debt was purportedly "made with the understanding that repayment would be deferred until [R. R. Crane] sought to make additional investments or Brian declared his desire to cease his involvement as a shareholder of [the company]," but these terms, including repayment and interest rate, were not reduced to writing. R. R. Crane did not issue any demand for repayment until Brian sought dissolution of the company in 2017.
Brian would later argue in opposition to R. R. Crane's summary judgment motion that the terms of the Debt were uncertain and unenforceable because the parties never reached an agreement as to whether interest would accrue and at what rate, when repayment was due, and whether the terms would change if Brian resigned from R. R. Crane. He cited R. R. Crane's own inconsistent allegations: In its initial cross-complaint, it alleged a 7 percent interest rate. In the first amended crosscomplaint, it pegged the interest rate to the Index of Applicable Federal Rates.
In May 2018 the trial court stayed the dissolution action and ordered the valuation of Brian's shares of R. R. Crane using three appraisers: the brothers would each select one appraiser and the two appraisers would then select a third appraiser. On December 21, 2020 the trial court awarded $6,182,918 to Brian for his shares, based on the appraisers' valuation as of November 13, 2017 when Brian filed for dissolution.
The trial court declined to include an offset of $878,168 or 50 percent of the outstanding loan and accrued interest alleged in R. R. Crane's cross-complaint. The trial court explained it had not yet adjudicated the cross-complaint regarding the amount of principal and interest Brian owed on the debt, if any. Additionally, only one of the three appraisers applied the offset, not a majority of the three, and that appraiser noted the trial court could decline to apply the offset based on its findings.
The trial court denied Brian's requests for prejudgment interest and for a deferred valuation date. It also rejected Brian's challenges to the appraisal. The court ordered R. R. Crane to pay Brian $6,182,918 by January 15, 2021 "if R. R. Crane desires to prevent the winding up and dissolution of R. R. Crane." R. R. Crane timely paid Brian, leaving Kevin as the sole shareholder of the company.
Brian appealed only the denial of prejudgment interest, which this court affirmed. (Crane v. R. R. Crane Investment Corp., supra, 82 Cal.App.5th 748.)
B. After the Initial Appeal, R. R. Crane's Cross-complaint Is Adjudicated
When the matter returned to the trial court, the parties filed cross-motions for summary judgment on Brian's debt to R. R. Crane.
Brian argued R. R. Crane's claim for repayment of the loans was time-barred because he disavowed the debt in a five-page written agreement with Kevin and Patrick on February 14, 2008. Brian presented evidence that, after their mother's death, the brothers executed that written agreement (the 2008 Agreement) in connection with their filing of IRS Form 706 for their mother's federal estate tax return.
The 2008 Agreement provided, among other things, that, "Kevin and Patrick have asserted that Brian remains liable on certain outstanding loans. These loans ('Debt') are to their parents (Robert Crane or Marguerite Crane, or both) and/or to a corporation owned by their parents." "Brian has disputed that he owes any part of the Debt claimed by Kevin and Patrick." Because Brian was unwilling to execute IRS Form 706 "and thereby admit that he owes the Debt or some portion of it," the brothers agreed that Brian's execution of IRS Form 706 was not an admission that he owed any portion of the Debt, nor could IRS Form 706 be used against him in litigation absent all three brothers' agreement.
We have omitted all unnecessary capitalization or emphasis in any documents quoted. We adopt the definition of "Debt" as used in the 2008 Agreement to refer to the loans at issue.
In Brian's view, the 2008 Agreement started the clock on the statute of limitations. R. R. Crane's cross-claims, filed in 2018, 10 years after the 2008 Agreement, were thus time-barred under any applicable statute of limitations.
In its summary judgment motion, R. R. Crane asserted the limitations period did not accrue in 2008 because the Debt was not yet due at that time. R. R. Crane asserted the parties agreed that repayment of the Debt would be deferred until R. R. Crane required money for additional investments or Brian expressed a desire to cease being a shareholder of the company. In support, R. R. Crane submitted the minutes of an October 20, 2000 board of directors meeting, during which "[l]oans to Patrick Crane and Brian Crane were discussed. To date there has been no demand for payment on these outstanding loans, as no investment property has been procured that would necessitate use of these funds for which they are primarily earmarked. The loans shall be continued until such time that a suitable investment is found."
According to R. R. Crane, Brian's subsequent statements and conduct reflected he understood he still owed the Debt to the company but only disputed the amount, creating a dispute of material fact.
First, it pointed to Brian's deposition testimony in unrelated litigation involving Patrick. In an April 11, 2011 deposition Brian testified, "I do know that I owe the corporation monies." When asked whether he disputed the Debt, he answered, "No." On March 25, 2013 Brian again testified he had a "still outstanding" Debt from R. R. Crane and that "the principal has not been paid, nor interest." Next, R. R. Crane also relied upon business records and tax returns it argued that Brian signed or otherwise acknowledged as president of the company, that continued to list the Debt as an asset of R. R. Crane after 2008.
Third, R. R. Crane relied on two email messages from Brian. In the first email, dated March 18, 2015, Brian disputed the amount, but not the existence, of the Debt. And in the second email, dated June 19, 2015, Brian told Kevin, "As I have stated ma[n]y times, the Loan due from Brian Crane is incorrect. [¶] The outstanding Balance per my books is $548,201.52."
Finally, R. R. Crane argued Brian's payment in 2014 to Patrick of $575,000, as part of the settlement of Patrick's litigation, demonstrated Brian's continued recognition of the Debt.
The trial court granted Brian's motion for summary judgment, ruling each cause of action alleged by R. R. Crane was barred by the statute of limitations: two years for the common counts and the breach of contract claim (Code Civ. Proc., § 339) and three years for the breach of fiduciary duty claim (Code Civ. Proc., § 338). It determined Brian met his burden to show all five causes of action accrued in 2008 when Brian refused to honor his obligation to repay. Thus, the statute of limitations expired, at the latest, three years later in 2011.
As relevant here, the trial court denied R. R. Crane's cross motion for summary judgment because it had not demonstrated that it was entitled to judgment as a matter of law, that Brian owed it a fiduciary duty, or that Brian's acknowledgement of the loan induced it to forebear any action to recover the loan. R. R. Crane does not challenge the trial court's denial of its summary judgment motion in this appeal.
The court determined R. R. Crane failed to demonstrate the existence of a triable issue of material fact because Brian's statements recognizing the Debt, the earliest of which occurred in April 2011, were all made after the statute of limitations expired in February 2011 and thus could not revive the Debt.
R. R. Crane's cross-complaint filed in 2018 was time-barred.
The court entered judgment in favor of Brian on June 7, 2022. R. R. Crane then moved to set aside and vacate the judgment, which the court denied. R. R. Crane timely appealed, both from the judgment entered against it and from the postjudgment order denying its motion to vacate the judgment. On appeal, R. R. Crane challenges only the trial court's judgment and underlying summary judgment order.
DISCUSSION
R. R. Crane contends that none of its cross-claims are barred by the statute of limitations because it raised material factual disputes regarding when the claims accrued. We agree.
A. Standard of Review
Summary judgment is appropriate only if there are no triable issues of material fact and the moving party is entitled to judgment as a matter of law. (Code Civ. Proc., § 437c, subd. (c); Regents of University of California v. Superior Court (2018) 4 Cal.5th 607, 618; Doe v. Roman Catholic Archbishop of Los Angeles (2021) 70 Cal.App.5th 657, 668.) The standard of review for an order granting a motion for summary judgment is de novo. (Sabetian v. Exxon Mobil Corp. (2020) 57 Cal.App.5th 1054, 1068 (Sabetian).) "In ruling on the motion, the court must 'consider all of the evidence' and 'all' of the 'inferences' reasonably drawn therefrom ([Code Civ. Proc.,] § 437c, subd. (c)), and must view such evidence [citations] and such inferences [citations], in the light most favorable to the opposing party." (Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 843 (fn. omitted) (Aguilar).)
A defendant moving for summary judgment has the initial burden of presenting evidence that a cause of action lacks merit because the plaintiff cannot establish an element of the cause of action or there is a complete defense. (Code Civ. Proc., § 437c, subd. (p)(2); Aguilar, supra, 25 Cal.4th at p. 853; Jolly v. Eli Lilly &Co. (1988) 44 Cal.3d 1103, 1109.) If the defendant satisfies this initial burden, the burden shifts to the plaintiff to present evidence demonstrating there is a triable issue of material fact. (Code Civ. Proc., § 437c, subd. (p)(2); Aguilar, at p. 850; Sabetian, supra, 57 Cal.App.5th at p. 1069.) "There is a triable issue of material fact if, and only if, the evidence would allow a reasonable trier of fact to find the underlying fact in favor of the party opposing the motion in accordance with the applicable standard of proof." (Aguilar, at p. 850.) Thus, a party "cannot avoid summary judgment by asserting facts based on mere speculation and conjecture, but instead must produce admissible evidence raising a triable issue of fact." (LaChapelle v. Toyota Motor Credit Corp. (2002) 102 Cal.App.4th 977, 981.)
While "[r]esolution of statute of limitations issues is ordinarily a question of fact," a defendant may still prevail on summary judgment if "'"the uncontradicted facts established through discovery are susceptible of only one legitimate inference."'" (State Compensation Ins. Fund v. Superior Court (2010) 184 Cal.App.4th 1124, 1132, quoting Romano v. Rockwell Internat., Inc. (1996) 14 Cal.4th 479, 487.)
B. Common Counts and Breach of Contract
1. Applicable Statutes of Limitations
R. R. Crane contends, Brian concedes, and we agree that a two-year statute of limitations applies to the common count and breach of contract cross-claims. (See Code Civ. Proc., §§ 337, 339; Leighton v. Forster (2017) 8 Cal.App.5th 467, 493 [claims for account stated, open book account or other indebtedness not founded upon a writing is barred by the two-year statute of limitations].) The trial court noted R. R. Crane "neither disputes that this limitations period applies nor asserts that another statute of limitations period applies." In its opening brief, R. R. Crane acknowledges it did not "quibble" about which statute of limitations applied to these claims.
It is well-settled that "[a] statute of limitations 'does not begin to run until the cause of action accrues,' and a cause of action accrues at the moment when the party alleging injury is entitled to ""bring and prosecute an action thereon.""" (Pollock v. Tri-Modal Distribution Services, Inc. (2021) 11 Cal.5th 918, 930-931 (Pollock); Code Civ. Proc., § 312.) The statute of limitations for a breach of contract claim ordinarily begins to run from the time of breach. (Aryeh v. Canon Business Solutions, Inc. (2013) 55 Cal.4th 1185, 1199 (Aryeh); Piedmont Cap. Mgmt., L.L.C. v. McElfish (2023) 94 Cal.App.5th 961, 968.) In order "to pinpoint the time of an alleged breach for purposes of the statute of limitations, it is necessary to establish what it was the defendant promised to do, or refrain from doing, and when its conduct diverged from that promise." (McCaskey v. California State Automobile Assn. (2010) 189 Cal.App.4th 947, 958 (McCaskey).) "'There can be no actual breach of a contract until the time specified therein for performance has arrived.'" (Hewlett-Packard Co. v. Oracle Corp. (2021) 65 Cal.App.5th 506, 550, quoting Taylor v. Johnston (1975) 15 Cal.3d 130, 137.)
Actions to recover on the common counts have different accrual dates from breach of contract claims. (See R. N.C., Inc. v. Tsegeletos (1991) 231 Cal.App.3d 967, 971-972 [limitations period begins to run on an account stated or a book account on the date of the last item or entry in the account]; Tabata v. Murane (1944) 24 Cal.2d 221, 226 [money lent].) But R. R. Crane advances no argument on appeal addressing these differences, waiving the issue. (Vascos Excavation Group LLC v. Gold (2022) 87 Cal.App.5th 842, 856.) R. R. Crane rests its statute of limitations argument for the common counts entirely on whether the statute of limitations has run on the breach of contract claim.
By contrast, a debt payable on demand starts accruing "with the inception of the obligation and without necessity for any demand." (Carrasco v. Greco Canning Co., Inc. (1943) 58 Cal.App.2d 673, 675; accord, Clunin v. First Federal Trust Co. (1922) 189 Cal. 248, 249; see also 3 Witkin, Cal. Procedure (6th ed. 2023) Actions, § 581(3).)
But where there is evidence the parties expressly intended the creditor is to have an "indefinite" amount of time to make a demand, the statute of limitations does not bar what may otherwise be a stale demand for money. The California Supreme Court long ago established that "in cases involving contracts for the payment of money, if the contract shows by its terms that the right to demand it is to endure for a considerable period, and that an indefinite delay in making it is contemplated, the rule that a demand must be made within the statutory period of limitation, counting that period from the time when the demand can first be made has never . . . been held to control and bar the action as a stale demand." (Vickrey v. Maier (1912) 164 Cal. 384, 391; see also Aitken v. Hayward (1945) 68 Cal.App.2d 168, 172 ["'"where delay in making the demand is expressly contemplated, even though the obligation is payable on demand, there is no rule of law that requires that demand shall be made within the statutory period for bringing an action"'"]; Kaplan v. Reid Bros., Inc. (1930) 104 Cal.App. 268, 272 [same]; see also 3 Witkin, Cal. Procedure (6th ed. 2023) Actions, § 581.)
2. R. R. Crane Demonstrated a Triable Issue of Material Fact on Accrual of the Common Counts and Contract Cross-claims
As he did in the trial court, Brian relies primarily on the 2008 Agreement to argue that all of R. R. Crane's causes of action started accruing in 2008 and that the limitations period on the common counts and contract cross-claims thus expired in 2010.Even if Brian met his initial burden on summary judgment, an issue we need not decide, we conclude R. R. Crane adduced evidence showing a triable issue of material fact on accrual.
In its reply brief on appeal, R. R. Crane argues for the first time that the "Debt" referred to in IRS Form 706 that was the subject of the 2008 Agreement may not be the $1.2 million alleged in the cross-complaint. But new arguments raised for the first time in a reply brief are forfeited. (High Sierra Rural Alliance v. County of Plumas (2018) 29 Cal.App.5th 102, 111, fn. 2 ["the rule is that points raised in the reply brief for the first time will not be considered"].) At oral argument, R. R. Crane also raised for the first time that the Debt was an ongoing and recurring obligation. This argument is also forfeited. (See Collins v. Navistar, Inc. (2013) 214 Cal.App.4th 1486, 1508.)
R. R. Crane argues its evidence demonstrates the parties agreed the loan would not be due until R. R. Crane made a demand for repayment in order to procure a suitable investment property. In its view, because no suitable investment property was ever found and no demand made, the statute of limitations did not accrue until it demanded payment on the Debt.
We reject R. R. Crane's alternate argument that payment of the Debt was due when Brian expressed he no longer desired to be a shareholder. R. R. Crane presented no evidence this was a term of the contract. Even if we accept the Debt was due only upon Brian's demand to exit the company, Brian presented evidence that he expressed this desire as early as August 29, 2014 in a letter by his counsel to Kevin and R. R. Crane. Under this theory, the breach of contract claim would have started accruing in 2014 and would have expired in 2016, well before R. R. Crane's 2018 cross-complaint.
In support of its payment "on demand" argument, R. R. Crane primarily relies on the October 2000 board meeting minutes, signed by Brian, which state, "To date there has been no demand for payment on these outstanding loans, as no investment property has been procured that would necessitate use of these funds for which they are primarily earmarked. The loans shall be continued until such time that a suitable investment is found." R. R. Crane argues these board minutes create a material fact dispute about when the Debt became due.
R. R. Crane also argues the following evidence of Brian's subsequent conduct and statements are sufficient to create a factual dispute regarding when performance on the Debt was due and when the limitations period accrued:
2008-2019 Redacted R. R. Crane financial records, such as samples of its "Loan Receivables," balance sheet, and general ledger, showing the Debt as a receivable for the company and disclosing the accrual of interest.
April 11, 2011 Brian was asked in deposition in unrelated litigation involving Patrick: "do you dispute the validity of the loan that is asserted here as from the corporation to you?" Brian responded: "I do know that I owe the corporation monies." When asked again whether he disputed the Debt, he answered, "No."
July 12, 2011 Brian testified in the separate litigation involving Patrick: "The only thing I said is I wanted the loan to be verified. I didn't question it. I just wanted to verify the numbers." He confirmed he did not dispute the validity of the Debt.
2013-2019 Brian signed R. R. Crane's tax returns as president of the company that continued to list the Debt as an asset of R. R. Crane.
March 25, 2013 Brian again testified he had a "still outstanding" Debt from R. R. Crane and that "the principal has not been paid, nor interest."
2014 Brian paid Patrick $575,000, representing Patrick's portion of the Debt as part of the settlement of Patrick's litigation, resulting in the buyout of Patrick's share of R. R. Crane. According to R. R. Crane, this payment demonstrated Brian's continued recognition of the Debt.
R. R. Crane relies on the probate court's comments from the bench on April 22, 2013 in Patrick's litigation, reciting the amounts owed on Brian's Debt. Although R. R. Crane suggests these comments are "judicial admissions", it fails to provide any legal authority to support this characterization of a court's comments relating to the settlement of a separate case.
March 18, 2015 Brian disputed the amount, but not the existence, of the Debt in an email to Kevin.
June 29, 2015 Brian told Kevin in an email, "As I have stated ma[n]y times, the Loan due from Brian Crane is incorrect. [¶] The outstanding Balance per my books is $548,201.52."
This is sufficient evidence on summary judgment to create a triable issue regarding the repayment terms of the parties' oral agreement and when the breach of contract cross-claim accrued. The board meeting minutes state the loans "shall be continued," indicating a delay in repayment was intended. Brian's acknowledgments of the Debt support R. R. Crane's argument that the parties contemplated the company would not make a demand for repayment for many years. Moreover, Brian's acknowledgements lead to the reasonable inference that he believed he continued to owe the Debt even after the 2008 Agreement. Under these circumstances, even if Brian repudiated the Debt in 2008, the Debt was not due at that time and thus his purported repudiation did not trigger the limitations period. The board meeting minutes and Brian's post-2008 conduct and statements created triable issues of material fact regarding when the time period began to run and when it expired.
We are not persuaded the lack of the word "agree" or its derivatives in the board minutes demonstrates Brian did not agree to continue the Debt until a suitable investment was found. To the contrary, it is reasonable to infer that the minutes would likely have included any disagreement by Brian on these terms of the Debt. In any event, on summary judgment, we must consider the evidence in the light most favorable to R. R. Crane. (Aguilar, supra, 25 Cal.4th at p. 843.)
Nor are we persuaded by Brian's contention R. R. Crane may not rely on his acknowledgements of the Debt, all of which occurred after the limitations period had purportedly run on February 14, 2011, to excuse its failure to timely assert its contract claims or to revive the Debt. We need not consider whether this evidence supports revival. We instead consider that Brian's acknowledgment of the Debt through his conduct and statements created a triable issue regarding whether the parties intended "that the right to demand [repayment] is to endure for a considerable period, and that an indefinite delay in making it is contemplated." (Vickrey v. Maier, supra, 164 Cal. at p. 391.)
R. R. Crane relies heavily on the same evidence listed above to argue that Brian's conduct revived the Debt under Code of Civil Procedure section 360 (section 360). The argument is forfeited because it was not raised in the trial court. But even if we reached the argument, none of this evidence meets the statutory requirements to revive a debt under section 360, in particular the requirement of a "writing, signed by the party to be charged thereby."
C. Breach of Fiduciary Duty
1. Applicable Statutes of Limitations
"'The elements of a cause of action for breach of fiduciary duty are the existence of a fiduciary relationship, its breach, and damage proximately caused by that breach.'" (Thomson v. Canyon (2011) 198 Cal.App.4th 594, 604 (Thomson).) A four-year statute of limitations applies to a claim for breach of fiduciary duty, unless the gravamen of the claim is actual or constructive fraud, in which case the statute of limitations is three years. (City of Vista v. Robert Thomas Securities, Inc. (2000) 84 Cal.App.4th 882, 889.) Here, the trial court applied the three-year statute of limitations to R. R. Crane's breach of fiduciary duty claim because the claim was based on Brian's alleged concealment of his intent not to repay the Debt. R. R. Crane does not contend this was error.
"[O]rdinarily, the statute of limitations runs from 'the occurrence of the last element essential to the cause of action.'" (Aryeh, supra, 55 Cal.4th at p. 1191.) The statute of limitations for breach of fiduciary duty generally commences when "'the [plaintiff] has knowledge or notice of the act constituting a breach of fidelity.' [Citations.] The existence of the fiduciary relationship limits the plaintiff's duty of inquiry by eliminating the plaintiff's usual duty to conduct due diligence, but it does not empower that plaintiff to '"sit idly by"' when '"'facts sufficient to arouse the suspicions of a reasonable [person] . . .'"' '"come to his [or her] attention."'" (Ferguson v. Yaspan (2014) 233 Cal.App.4th 676, 683.) But where "'damages are an element of a cause of action, the cause of action does not accrue until the damages have been sustained. [Citation.] "Mere threat of future harm, not yet realized, is not enough."'" (Thomson, supra, 198 Cal.App.4th at p. 604.) In other words, the statute commences on a breach of fiduciary duty claim when damage to the plaintiff has been realized. (Ibid.)
In Thomson, the plaintiff hired defendants, a real estate agent and a broker, to sell her home. The plaintiff alleged the sale was meant to save her home from foreclosure by conveying the property to an investor, who would be paid to clear the liens and then reconvey the home to the plaintiff. The defendants failed to memorialize the reconveyance agreement in the sale documents and the buyer refused to reconvey the property, instead selling it to a third party. (Thomson, supra, 198 Cal.App.4th at p. 598.) After the plaintiff failed to recover against the buyer at trial, she sued the defendants for breach of fiduciary duty. The trial court granted defendants' motion for judgment on the pleadings based on the statute of limitations.
The Court of Appeal reversed. (Thomson, supra, 198 Cal.App.4th at p. 598.) Thomson ruled the trial court erred when it determined the cause of action accrued at close of escrow. While the defendants breached their duty to the plaintiff by failing to memorialize the sell-back agreement at that time, the plaintiff was not immediately damaged by the missing sell-back agreement. The damage occurred, and the claim for breach of fiduciary duty accrued, only when the buyer refused to honor the oral agreement and reconvey the property back to the plaintiff. (Id. at p. 604.)
2. R. R. Crane Demonstrated a Triable Issue of Material Fact on Accrual of the Fiduciary Duty Cross-claim
We again assume, without deciding, that Brian carried his initial summary judgment burden on the breach of fiduciary duty cross-claim. In Brian's view, the limitations period accrued in 2008 and expired in 2011. We conclude R. R. Crane adduced sufficient evidence to demonstrate there is a material dispute regarding whether Brian disclosed or hid his intent not to repay the Debt. Indeed, the basis for R. R. Crane's breach of fiduciary duty cross-claim is its allegation that Brian hid his intent not to repay the Debt by acknowledging the Debt after 2008.
As noted above, R. R. Crane introduced evidence that Brian acknowledged the Debt after 2008, which conflicted with his repudiation of it in the 2008 Agreement. The same facts set out above-the tax returns, financial statements, partial payment, deposition testimony, and emails-support R. R. Crane's position. Moreover, Brian admitted the Debt remained on R. R. Crane's books from 2008 (when he was president and after his repudiation) to 2014 (when he contends Kevin took control of R. R. Crane). He did not remove the Debt from R. R. Crane's financial records while he was president because he "did not want to be accused of self-dealing." He requested Kevin remove the Debt only after 2014. The facts acknowledging the validity of the Debt create a material factual dispute regarding Brian's repudiation of the Debt in 2008, and the record as whole is not "'"susceptible of only one legitimate inference."'" (State Compensation Ins. Fund v. Superior Court, supra, 184 Cal.App.4th at p. 1132; E-Fab, Inc. v. Accountants, Inc. Services (2007) 153 Cal.App.4th 1308, 1320 [factual questions become issues of law only if "'reasonable minds can draw only one conclusion from the evidence'"].) R. R. Crane's evidence created a triable issue whether a reasonable person would have known facts constituting the breach of fiduciary duty.
We are not persuaded by Brian's attempt to characterize his post-2008 statements as "nothing more than an acknowledgement by Brian that the Alleged Loan had at one time existed." That does not square with Brian's repeated conduct and statements acknowledging the existence of the Debt. Further, we are required to draw inferences from the evidence in the light most favorable to R. R. Crane as the non-moving party. (See Aguilar, supra, 25 Cal.4th at p. 843.) A fact finder could reasonably infer from Brian's post-2008 conduct and statements that he believed he continued to owe the Debt.
R. R. Crane's evidence also demonstrates a triable issue exists as to when R. R. Crane suffered damages, thus starting the limitations period on that basis. As noted above, R. R. Crane introduced evidence that Brian agreed in 2000 that no demand for repayment would be made for an undetermined but lengthy period of time. R. R. Crane made its demand for repayment 17 years later. Under Thomson, R. R. Crane's breach of fiduciary duty cause of action did not accrue until it suffered damages, that is, it demanded payment in the cross-complaint and Brian refused to pay. Viewing the evidence in the light most favorable to R. R. Crane, the evidence would also support a finding that the Debt was not due at the time of the 2008 Agreement because until R. R. Crane made a demand for payment, Brian's dispute of the Debt was a "'"[m]ere threat of future harm, not yet realized."'" (Thomson, supra, 198 Cal.App.4th at p. 604.)
Because we determine R. R. Crane has presented sufficient evidence to demonstrate a triable issue on accrual, we need not address its arguments that equitable estoppel bars Brian's reliance on the statute of limitations defense, or that R. R. Crane is entitled to an offset under Code of Civil Procedure section 431.70.
DISPOSITION
The judgment is reversed. The trial court is directed to vacate its order granting Brian's motion for summary judgment and enter a new order denying the motion. R. R. Crane is entitled to recover its costs on appeal.
We concur: SEGAL, Acting P. J., FEUER, J.