May 10, 2017

Equitable Estoppel

When a litigant desires to seek legal action, timeliness is key. A party is generally obligated to seek redress within a certain period of time. This is known as the statute of limitations.

For example, Code of Civil Procedure § 366.3(a) provides that "[i]f a person has a claim that arises from a promise or agreement with a decedent to distribution from an estate or trust or under another instrument, whether the promise or agreement was made orally or in writing, an action to enforce the claim to distribution may be commenced within one year after the date of death, and the limitations period that would have been applicable does not apply." Therefore, the aggrieved party has 1 year to commence an action following the decedent's death. If filed after 1 year, the claim is considered time-barred because the statute of limitations has run. 

However, there is an exception to this rule. The doctrine of equitable estoppel "comes into play only after the limitations period has run to preclude a party from asserting the statute of limitations as a defense to an untimely action where the party's conduct has induced another into forbearing to file suit." (McMackin v. Ehrheart (2011) 194 Cal.App.4th 128, 140. This doctrine consists of four elements: "(1) the party to be estopped must be apprised of the facts; (2) he must intend that his conduct shall be acted upon, or must so act that the party asserting the estoppel had a right to believe it was so intended; (3) the other party must be ignorant of the true state of facts; and (4) he must rely upon the conduct to his injury." City of Long Beach v. Mansell (1970) 3 Cal.3d 462, 489.

For purposes of illustration, assume that Danny orally promised Billy that he would bequeath his home to him in a will. Danny thereafter had a change of heart and bequeathed the property to his neighbor Fred and named Fred the executor. Danny then died on May 10, 2010. Fred intentionally stalled in lodging the will until 1 year had elapsed. He eventually lodge the will on June 2, 2011.

Fred was aware of Code of Civil Procedure § 366.3(a) so he thought by delaying probate until after the statute of limitations had run, he would not have to worry about Billy's claim. When Billy periodically asked Fred about the matter, Fred told him that he was still searching for the will. Billy believed Fred as they were acquaintances. 

These facts could potentially give rise to an equitable estoppel claim if Billy pursues an action against Fred, as executor of Danny's estate.

First, Fred knew the pertinent facts regarding Danny's will, i.e. he received the property not Billy. Second, Fred knew that Billy would believe him about the will's erroneous disappearance because of their relationship. Third, Billy was not able to procure a copy of Danny's will so as to be made aware of the situation. Fourth, by believing Fred's false statements about the will, Billy suffered an injury as any claim he could make would be time-barred since more than 1 year elapsed after Danny's passing.