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Keywords

contractlawsuitbreach of contracttortplaintiffdefendantdamagesnegligencestatutefiduciarystatute of limitationsfiduciary dutytreble damages
contractlawsuitbreach of contracttortplaintiffdefendantdamagesnegligencestatutefiduciarystatute of limitationssustainedtreble damages

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Jones v. Childers, 18 F.3d 899, RICO Bus.Disp.Guide 8529, 40 Fed. R. Evid. Serv. 843

Facts

Gordon and Laura Jones, a professional athlete and his wife, filed a lawsuit against Talent Services, Inc. (TSI) and its president, John H. Childers, alleging fraud, negligence, breach of contract, and violations of Florida's Civil Remedies for Criminal Practices Act (CRCPA). The Joneses claimed that while representing Gordon as his agent and financial advisor, the defendants mismanaged their investments and provided misleading information about the risks involved. The case was initially filed in state court and later removed to federal court, where the district court found in favor of the plaintiffs, awarding them damages.

On December 3, 1987, Plaintiffs filed this action in the Circuit Court for Hillsborough County, Florida, alleging that Defendants Childers and TSI committed fraud, negligence, breach of contract, and Florida civil RICO violations while representing Gordon Jones, a professional football player, as his agent and financial advisor.

Issue

Did the district court err in its application of Florida's economic loss doctrine, the statute of limitations, and the awarding of treble damages under the CRCPA?

Did the district court err in its application of Florida's economic loss doctrine, the statute of limitations, and the awarding of treble damages under the CRCPA?

Rule

Under Florida's economic loss doctrine, a plaintiff cannot pursue tort claims for purely economic damages resulting from a breach of contract unless there is evidence of personal injury or property damage. Additionally, the statute of limitations for claims begins when a party is put on notice of their right to a cause of action, which can be equitably tolled if a fiduciary relationship exists and the defendant conceals the cause of action.

Under Florida's economic loss doctrine, a plaintiff may not raise tort claims to recover solely economic damages arising from breach of contract absent evidence of personal injury or property damage.

Analysis

The court determined that the economic loss doctrine did not bar the Joneses' tort claims because they were based on breaches of fiduciary duty and fraud, which are independent of the contract. The court also found that the statute of limitations did not begin until the Joneses received their first IRS notice of deficiency in June 1985, as they had relied on Childers' assurances and were not aware of their claims earlier. The court concluded that the Joneses exercised reasonable diligence in pursuing their claims, and thus, the claims were timely.

The district court found that the Joneses' causes of action did not accrue until June 1985, when they received the first IRS notice of deficiency. The court concluded that the Joneses exercised reasonable due diligence to determine whether injury had been sustained or that a right had been invaded.

Conclusion

The court affirmed in part and reversed in part, ruling that the Joneses were entitled to damages and that the economic loss doctrine did not bar their claims.

The court affirmed in part and reversed in part, ruling that the Joneses were entitled to damages and that the economic loss doctrine did not bar their claims.

Who won?

The plaintiffs, Gordon and Laura Jones, prevailed in their lawsuit against TSI and John H. Childers. The court found that the defendants had committed fraud and breached their fiduciary duties, leading to significant financial losses for the Joneses. The court's ruling emphasized the defendants' misleading representations and the fiduciary relationship that existed, which justified the award of damages, including treble damages under the CRCPA.

The plaintiffs, Gordon and Laura Jones, prevailed in their lawsuit against TSI and John H. Childers. The court found that the defendants had committed fraud and breached their fiduciary duties, leading to significant financial losses for the Joneses.

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