USCA1 Opinion
October 27, 1994
[NOT FOR PUBLICATION]
UNITED STATES COURT OF APPEALS
FOR THE FIRST CIRCUIT
____________________
No. 94-1320
KEVIN PRICE, ET AL.,
Plaintiffs, Appellants,
v.
SHAWMUT BANK, N.A.,
Defendant, Appellee.
____________________
APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEW HAMPSHIRE
[Hon. Paul J. Barbadoro, U.S. District Judge]
___________________
____________________
Before
Torruella, Chief Judge,
___________
Coffin, Senior Circuit Judge,
____________________
and Keeton*, District Judge.
______________
____________________
Edmund J. Waters, Jr. for appellants.
_____________________
Richard V. Wiebusch with whom Jude A. Curtis and Michael G.
____________________ ________________ ___________
Bongiorno were on brief for appellee.
_________
____________________
____________________
____________________
*Of the District of Massachusetts, sitting by designation.
COFFIN, Senior Circuit Judge. This appeal raises the
______________________
question of the proper time to commence the statute of
limitations period in an action challenging a bank's failure to
discharge a mortgage. Plaintiffs contend that the district court
started the clock prematurely, and thus wrongly dismissed the
case as time-barred.
The facts, drawn from the complaint, are as follows. In the
summer of 1989, plaintiffs Kevin and Linda Price began the
process of building a house on Lot 10 of a subdivided parcel of
land they owned in Deerfield, New Hampshire. Arlington Trust
Company, the predecessor in interest to defendant Shawmut Bank,
held a $250,000 mortgage on the entire property. To finance the
construction, the Prices obtained a $100,000 loan from Rockingham
County Trust Co., which was secured by a mortgage specifically on
Lot 10. The Prices allege that, before signing with Rockingham,
they elicited an oral promise from Arlington that it would
discharge its mortgage on Lot 10 in exchange for $30,000 of the
$100,000 Rockingham loan.
The plaintiffs paid the $30,000 to Arlington in October
1989. Sometime thereafter, as a result of a title search
conducted in connection with the sale of the house on Lot 10, the
Prices learned that the mortgage had not been discharged. They
hired an attorney, who made multiple demands for release of the
mortgage on Shawmut, which by then had acquired Arlington's
assets and liabilities. On both February 14 and March 6, 1990,
Shawmut, in writing, refused to do so.
Further discussion ensued and, in April, Shawmut agreed to
subordinate its mortgage to Rockingham's construction loan
mortgage. Rockingham foreclosed on Lot 10 in June 1990. Shawmut
foreclosed on the remainder of the property about a year later.
The Prices filed this lawsuit on March 23, 1993, asserting
various claims arising from the bank's failure to provide the
mortgage discharge. The district court dismissed the action,
holding that the three-year statute of limitations contained in
N.H. Rev. Stat. Ann. 508:4 began to run when the Prices
"learned that there was an encumbrance on Lot 10 which Arlington
had wrongfully failed to remove." The court found that this
occurred, according to the allegations in the complaint, "well
more than three years before they commenced this action."
On appeal, plaintiffs argue that the district court selected
the wrong point in time to begin the limitations period. They
assert that the injury occurred, and the statute began running,
only when Rockingham foreclosed on Lot 10 in June 1990. Until
that time, plaintiffs maintain, Shawmut could have changed its
position and issued the discharge that would have allowed the
sale of the house to proceed smoothly.
We agree with the district court that the limitations period
commenced when the Prices learned that Arlington had not complied
with its alleged promise to discharge the Lot 10 lien upon
receipt of the $30,000.* Unquestionably, the agreement between
____________________
* The complaint indicates that this probably occurred in
late 1989 but, in any event, in February 1990 when Shawmut first
informed the Prices in writing that it would not discharge the
-3-
the Prices and Arlington was breached when Arlington failed to
release Lot 10 from the mortgage shortly after the Prices made
their payment. The breach had an immediate impact: it clouded
the Prices' title to Lot 10, stalling the ongoing purchase-and-
sale process, and caused the Prices to hire an attorney to pursue
the issue. Indeed, the causes of action asserted in their
complaint center on Shawmut's failure to discharge the mortgage,
not on the subordination of its mortgage and the subsequent
foreclosures.
During the negotiations in late 1989 and early 1990, the
Prices undoubtedly hoped that they could persuade Shawmut to
grant the release. That the irrevocable injury did not occur
until Rockingham foreclosed in June, however, does not eradicate
the injury that occurred as soon as Arlington failed to release
the mortgage upon receipt of the Prices' payment. See Rowe v.
___ ____
John Deere, 533 A.2d 375, 376-78, 130 N.H. 18, 21-23 (1987)
___________
(limitations period commences at time of initial injury, not at a
later date when plaintiff learned the full extent of his
injuries). Plaintiffs' theory comes down to saying that, so long
as an injury remains reversible through successful negotiation,
it has not accrued. Such would indeed defeat the policies
underlying limitations statutes.
Moreover, even when their lack of success became apparent,
the Prices still had more than two and one-half years during
which they could have filed a timely lawsuit. As the district
____________________
mortgage.
-4-
court ruled, "[t]heir failure to do so . . . serves as a bar to
their present claims."
Affirmed.
________
-5-
