stating that “[a]bsent a fiduciary relationship, this Court has held that a plaintiff seeking to establish fraudulent concealment must prove that the defendant took affirmative action to conceal the cause of action and that the plaintiff could not have discovered the cause of action despite the exercise of reasonable diligence, ... and that, in such cases, the affirmative act on the part of the defendant ... must be some act intended to exclude suspicion and prevent injury, or there must be a duty on the part of the defendant to disclose such facts, if known”
How later courts described this case
- stating that “[a]bsent a fiduciary relationship, this Court has held that a plaintiff seeking to establish fraudulent concealment must prove that the defendant took affirmative action to conceal the cause of action and that the plaintiff could not have discovered the cause of action despite the exercise of reasonable diligence, ... and that, in such cases, the affirmative act on the part of the defendant ... must be some act intended to exclude suspicion and prevent injury, or there must be a duty on the part of the defendant to disclose such facts, if known”
- stating that, based on the facts known to plaintiffs as of a certain date, they were on inquiry notice; their continued reliance on a lawyer’s advice was akin to “a passenger on the Titanic, observing the ship plunging into the sea . . . remain[ing] convinced that all was well”
- holding that on the record in this case, “a finder-of-fact could conclude that it was reasonable for the petitioners, untrained in the law and relying on the fiduciary relationship with their attorneys, to have failed to discover their cause of action against the respondents”
- explaining that the determination of accrual “may be based solely on law, solely on fact, or on a combination of law and fact, and is reached after careful consideration of the purpose of the statute and the facts to which it is applied”
Written by the judges who cited it.
The opinion
WILNER, Judge,
Dissenting.
With respect, I dissent. Sweeping aside as though irrelevant or unimportant all of the stark facts to the contrary, the Court concludes that “on the record in this case, a finder-of-fact could conclude that it was reasonable for the petitioners, untrained in the law and relying on the fiduciary relationship with their attorneys, to have failed to discover their cause of action against the respondents.” On the record in his case, it seems to me, it was about as reasonable for petitioners, after December, 1988, to continue to rely on Brown’s advice and *119 assurances as it would have been for a passenger on the Titanic, observing the ship plunging into the sea, to remain convinced that all was well.
Under the “discovery rule,” a cause of action accrues “when the wrong is discovered or when with due diligence it should have been discovered. Poffenberger v. Risser, 290 Md. 631, 634-35 , 431 A.2d 677, 679 (1981). That rule, we further held, “contemplates actual knowledge — that is express cognition, or awareness implied from ‘knowledge of circumstances which ought to have put a person of ordinary prudence on inquiry [thus, charging the individual] with notice of all facts which such an investigation would in all probability have disclosed if it had been properly pursued.’ ” Id, at 637, 431 A.2d at 681 (alteration in original) (quoting Blondell v. Turover, 195 Md. 251, 257 , 72 A.2d 697, 699 (1950)). I agree with the Court’s view that, when the parties are in a confidential relationship, the confiding party “is under no duty to make inquiries about the quality or bona fides of the services received, unless and until something occurs to make him or her suspicious.” My disagreement is not so much with the statement of the law as with its application in this case. It was more than “something” that occurred that should have made petitioners suspicious; it was a whole senes of things, culminating in the events of December, 1988.
Petitioners were on notice from the very beginning that Brown’s scheme was possibly flawed. They were aware of Mr. Wolfs deep concern, and even the accountant, Bonsai, warned them of “possible tax consequences.” They had every right, at that time, to regard Mr. Wolfs warnings as merely a difference of professional opinion and to proceed in accordance with Mr. Brown’s advice, but they at least were aware that a highly qualified attorney believed that the scheme was flawed, that it likely would be challenged by IRS, and that, if challenged successfully, they would be subject to a substantial tax and penalty. Even when, as Mr. Wolf, and Mr. Brown, predicted, IRS did challenge the scheme, petitioners probably had the right to rely on Mr. Brown’s assurance that all would be well in the end. At least, a jury could find that to be so. *120 When, in a complete turn-about, however, Brown advised petitioners to throw in the towel and settle for $20 million, half of which was in penalties, their continuing blind faith in him for another six-and-a-half years is simply inexplicable.
Petitioners are not unsophisticated, uneducated people. They are affluent individuals who obviously had lawyers and accountants at their command. They were privileged, of course, at their risk, to remain in a state of denial and accept Brown’s statement that their position was prejudiced only by IRS’s possession of Wolfs letter, but to hold that they were not, as a matter of law, on inquiry notice at that point strikes me as wholly unwarranted. This is not a credibility issue— who one believes. The test is an objective one — what would a person of ordinary prudence be expected to do when undisput-ably aware of these uncontradicted facts? Petitioners, who had been warned at the outset that the scheme was flawed, had just seen it collapse. Instead of making an independent, objective inquiry into Brown’s excuse that Wolf was at fault, they blindly followed Brown’s recommendation that they hire another lawyer to sue Wolf. It is not entirely clear from this record how IRS came into possession of Wolfs letter, but, however that occurred, it now seems to be accepted that the letter would have been inadmissible against petitioners, which presumably any competent attorney would have told petitioners had they inquired. If petitioners had consulted counsel in that regard and been so informed, they would certainly have had a basis not only to question Brown’s assertion that the need to settle was prompted by Wolfs letter but to question as well virtually everything he had told them.
To me, on this record, the Court’s conclusion constitutes an unwarranted extension of the discovery rule. I would affirm the judgment of the Court of Special Appeals.
Judge RODOWSKY has authorized me to state that he joins in this dissenting opinion.