Derron Gerard Flores, administrator of the Estate of Donald G. Flores v. First Hawaiian Bank

NOT FOR PUBLICATION
UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT
DERRON GERARD FLORES,
administrator of the Estate of Donald G.
Flores,
Plaintiff - Appellant,
v.
FIRST HAWAIIAN BANK,
Defendant,
and
MUFG UNION BANK, N.A, fka Union
Bank of California, fka Union Bank, N.A.,
Defendant - Appellee.
No. 13-17434
D.C. No. 1:11-cv-00022
MEMORANDUM*
Appeal from the United States District Court
for the Northern Mariana Islands
Ramona V. Manglona, Chief District Judge, Presiding
Argued and Submitted February 11, 2016
University of Hawaii Manoa, Honolulu, Hawaii
Before: GRABER, BYBEE, and CHRISTEN, Circuit Judges.
FILED
MAR 04 2016
MOLLY C. DWYER, CLERK
U.S. COURT OF APPEALS
* This disposition is not appropriate for publication and is not precedent
except as provided by 9th Cir. R. 36-3.

-- 1 of 9 --

Plaintiff Derron Gerard Flores, administrator of the Estate of Donald G.
Flores ("Decedent"), appeals the district court’s grant of summary judgment to
Defendant Union Bank on the ground that the statute of limitations bars Plaintiff’s
claims and appeals the award of attorney fees to Defendant. Reviewing de novo
the grant of summary judgment, Johnson v. Poway Unified Sch. Dist., 658 F.3d
954, 960 (9th Cir. 2011), and for abuse of discretion the award of attorney fees,
Goodman v. Staples Office Superstore, LLC, 644 F.3d 817, 822 (9th Cir. 2011),
we affirm in part, reverse in part, and remand for further proceedings.
1. We reverse the district court’s holding that the statute of limitations
began to run in 1999. Under relevant law of the Commonwealth of the Northern
Mariana Islands ("CNMI"), a "cause of action against the obligor of a demand or
time certificate of deposit accrues upon demand." 5 CMC § 3122(2). The district
court held that Decedent’s visit to the Bank in 1999 and his inquiry—"how I get
my money"—constituted a demand.
We disagree. It is disputed whether Decedent was requesting payment or
merely inquiring about the process by which to redeem his time certificate of
deposit ("TCD"). But, even if Decedent requested payment, the Bank did not
refuse to pay him at that time. Instead, it simply told him to bring in his TCD,
which was a conditional acceptance.
2

-- 2 of 9 --

The statute of limitations did not begin to run until Decedent’s demand was
refused. Although this is an issue of first impression in the CNMI, every court to
consider what constitutes a "demand" in the context of suing on a certificate of
deposit requires not only an unequivocal "demand," but also a refusal. See, e.g.,
Statute of Limitations as Applied to Certificate of Deposit, 128 A.L.R. 157 (1940);
Allied Fid. Ins. Co. v. Bank of Okla., N.A., 894 P.2d 1101, 1105 (Okla. 1995)
(statute of limitations began to run when unequivocal demand was unsatisfied);
Edelmann v. Chase Manhattan Bank, N.A., 861 F.2d 1291, 1302 n.66 (1st Cir.
1988) ("Demand occurs upon presentment and refusal to pay." (quoting Garcia v.
Chase Manhattan Bank, N.A., 735 F.2d 645, 648 (2d Cir. 1984))); Erwin v. Erwin,
41 N.E.2d 644, 646 (Ind. Ct. App. 1942) ("great weight of authority" holds that
claim does not accrue until there has been a refusal). When we confront an issue
of first impression under state law, we must decide what we think the highest state
court would do. Med. Lab. Mgmt. Consultants v. Am. Broad. Cos., 306 F.3d 806,
812 (9th Cir. 2002). Here, we conclude that the CNMI Supreme Court would
follow the general rule and hold that a refusal is required to begin the statute of
limitations after a demand for payment of a certificate of deposit has been made.
Accordingly, Decedent’s cause of action did not accrue in 1999.
3

-- 3 of 9 --

2. On June 10, 2008, Decedent wrote to the Bank, formally requesting
payment. This action was unequivocally a demand that was refused on September
22, 2008, when the Bank wrote back. We therefore hold that a cause of action
accrued on that date and began the statute of limitations period.
3. Decedent filed this action on September 22, 2011, claiming breach of
contract, unjust enrichment, negligence, fraud, and violation of the CNMI
Consumer Protection Act. In the CNMI, the statute of limitations for contract
claims is six years. Century Ins. Co. v. Guerrero, 2009 MP 16 ¶ 7, 2009 WL
4855961, at *2 (N. Mar. I. 2009). The period is four years for claims under the
Consumer Protection Act. 4 CMC § 5110. It is two years for tort claims. 7 CMC
§ 2503(d). Therefore, we hold that Decedent’s contract claims and Consumer
Protection Act claim are not barred by the statute of limitations; his tort claims are
time-barred.
4. Decedent argues that fraudulent concealment tolls the statute of
limitations for his tort claims. But Decedent did not raise a material issue of fact
that Defendant fraudulently concealed facts that prevented him from discovering
his claim. Accordingly, the fraudulent concealment claim fails.
5. Defendant argues that, notwithstanding the statute of limitations, laches
should apply to bar his claims. A party claiming a laches defense bears the burden
4

-- 4 of 9 --

to show "(1) inexcusable delay in the assertion of a known right; and (2) the party
asserting laches was prejudiced." In re Estate of Rios, 2008 MP 5 ¶ 9, 2008 WL
986043, at *3 (N. Mar. I. 2008). The Bank has shown neither inexcusable delay
nor prejudice. Even assuming that laches could apply in addition to the applicable
statute of limitations, the doctrine would not bar Plaintiff’s claims.
6. Finally, Decedent argues that the district court erred in awarding attorney
fees despite denying a grant of a motion to compel. Federal Rule of Civil
Procedure Rule 37 provides that the court must award attorney fees for a motion to
compel "[i]f the motion is granted—or if the disclosure or requested discovery is
provided after the motion was filed." Here, Decedent produced all tax documents
in his possession after Defendant had filed a motion to compel. For that reason,
the district court correctly awarded attorney fees to Defendant.
AFFIRMED in part, REVERSED in part, and REMANDED. The
parties shall bear their own costs on appeal.
5

-- 5 of 9 --

Flores v. MUFG Union Bank, N.A., No. 13-17434
BYBEE, Circuit Judge, concurring in part and in the judgment, dissenting in part:
I agree with the majority’s decision holding that summary judgment in favor
of Union Bank (“the Bank”) was inappropriate at this stage in the litigation, and
concur in the judgment that this case should be remanded to the district court. See
Mem. Dispo. at 2. I also agree that Decedent’s fraudulent concealment claim fails,
see Mem. Dispo. at 4, that the doctrine of laches does not apply to this case, see
Mem. Dispo. at 4–5, and that the district court properly awarded attorney fees to
the Bank, see Mem. Dispo. at 5.
I part ways with the majority, however, as to what is necessary under the
governing law of the Commonwealth of the Northern Mariana Islands (“CNMI”)
to trigger the two, four, and six-year limitations periods at issue here. See Mem.
Dispo. at 2–4. 5 CMC § 3122(2) explains that a “cause of action against the
obligor of a . . . time certificate of deposit accrues upon demand.” (Emphasis
added.) The majority, however, reads into § 3122(2) a refusal requirement,
holding that “refusal is required to begin the statue of limitations after a demand
for payment of a certificate of deposit has been made.” Mem. Dispo. at 3. This
requirement is absent from the text of the CNMI statute, and, as the majority
rightly points out, such a requirement has never been found by the CNMI Supreme
Court. See Mem. Dispo. at 2 (noting that “what constitutes a ‘demand’” is “an
FILED
MAR 04 2016
MOLLY C. DWYER, CLERK
U.S. COURT OF APPEALS

-- 6 of 9 --

issue of first impression in the CNMI”). Although the weight of out-of-jurisdiction
authority favors the majority’s reading of the statute, see Mem. Dispo. at 2–3, I see
no need to answer this question on behalf of the CNMI Supreme Court, especially
as the district court did not pass on the issue.
Instead, I think that summary judgment was improper because there is a
disputed issue of material fact—whether Decedent’s 1999 conversation with a
Bank representative constituted a demand or merely a request for information. If
the finder of fact was to determine that the conversation was a demand, then I think
the statute of limitations on all Decedent’s claims began ticking in 1999, rendering
all his claims time-barred when he brought his suit in 2011. Alternatively, if the
finder of fact was to determine that the conversation was not a demand, then I think
the statute of limitations would not begin running until Decedent’s counsel wrote a
letter to the Bank demanding payment in 2008, rendering only his tort claims time-
barred.
Even if I were to agree with the majority’s reading of § 3122(2) and hold
that both a demand from the Decedent and a refusal from the Bank are necessary to
start the statute-of-limitations clock, I do not believe the outcome I have outlined
above would change. If, on remand, the finder of fact were to determine that
Decedent’s 1999 conversation with a Bank representative was a demand, then
2

-- 7 of 9 --

didn’t the Bank refuse that demand? Perhaps the Bank did not say, “Mr. Flores,
we are refusing your demand and you may not have your money,” but Decedent
certainly did not walk out of the Bank with $200,000 in his pocket. If the Bank’s
response was not a refusal, what was it? A “conditional acceptance,” see Mem.
Dispo. at 2, as the majority terms it? A contingent refusal? The practical effects of
the Bank saying “no” and the Bank saying “no, because you don’t have your
certificate of deposit” are the same—both are refusals of Decedent’s immediate
demand of “I’d like my money right now, please.”1 As the Oklahoma Supreme
Court observed when examining a similar statute under Oklahoma law, the statute
of limitations began running only after the holder of the certificate of deposit, “first
made demand for the funds, and that demand was unsatisfied.” Allied Fid. Ins. Co.
v. Bank of Okla., N.A., 894 P.2d 1101, 1105 (Okla. 1995) (emphasis added). That
is precisely what the finder of fact could determine happened here: Decedent made
a demand and it was unsatisfied. The majority has stepped into the role of
factfinder and decided that the Bank did not refuse the Decedent. If the majority is
unsure—as I am—that Decedent demanded his money, I don’t see how the
1 The majority resists this conclusion, noting that “even if Decedent
requested payment, the Bank did not refuse to pay him,” and instead “simply told
him to bring in” his certificate of deposit. Mem. Dispo. at 2. When one is in need
of $200,000 and cannot find his certificate of deposit to redeem that $200,000, this
seems to me a distinction without a difference.
3

-- 8 of 9 --

majority gets to decide that the Bank didn’t refuse him.
Because I would decline to read a refusal requirement into § 3122(2) where
the CNMI Supreme Court has not, as to that issue, I respectfully dissent. And,
even if I agreed with the majority’s construction of § 3122(2), I think the issues of
demand and refusal should be decided by a jury.
4

-- 9 of 9 --