Allred v. Allred

2008 UT 22
This opinion is subject to revision before final
publication in the Pacific Reporter.
IN THE SUPREME COURT OF THE STATE OF UTAH
----oo0oo----
David H. Allred, deceased, by and 	Nos. 20051049
through Mary A. Jensen, personal 	20060171
representative for the Estate of
David H. Allred; and Inez H. Allred,
Plaintiffs, Appellants, and
Cross-Appellees,
v.
Richard G. Allred, individually and
as Trustee for The Richard Mark
Allred Trust, The Robert Matthew
Allred Trust, The Mary Michelle
Allred Trust, The Michael Christopher
Allred Trust, The Stephen James
Allred Trust, The Karen Allred Trust,
The Nathan Allred Trust, The Mary
Allred Trust; Mary Lee Allred, as
Trustee for the Richard G. Allred
Trust; and Qwest Corporation, 	F I L E D
Defendants, Appellees, and
Cross-Appellants. 	March 4, 2008
---
Fourth District, Provo Dep’t
The Honorable Anthony W. Schofield
No. 010400765
Attorneys: 	Michael R. Carlston, Kenneth L. Reich, Salt Lake
City, for plaintiffs
Richard G. Allred, Anaheim, CA, for defendants
Mary Lee Allred, Bountiful, pro se
---
DURRANT, Justice:
INTRODUCTION
¶1 	In this case we are called upon to decide whether a
claimant to property by adverse possession may satisfy the actual

Nos. 20051049, 20060171 	2
possession requirement through a tenant. 	We conclude that
placing a tenant on property and collecting the rent for one’s
own benefit may constitute actual possession and use of the
property adverse to the legal title holder, which, if hostile,
open and notorious, and continuous for the statutory period, may
ripen into legal title. 	Accordingly, we reverse the district
court’s order granting summary judgment to the legal title holder
in this case. 	Further, we reverse the district court’s order
denying summary judgment for the claimants in this case and
remand with instructions to enter summary judgment in their favor
and for other proceedings consistent with this opinion.
BACKGROUND
¶2 	The material facts presented in this appeal are not in
dispute. 	Plaintiffs David and Inez Allred (the “Parents”)
acquired commercial property in Provo, Utah, (the “Property”) in
approximately 1972 and leased the Property shortly thereafter to
Mountain States Telephone & Telegraph Company, a predecessor of
Qwest Communications. 	Qwest Communications or its predecessors
(collectively, “Qwest”) have remained in possession of the
Property as tenants from 1974 to the present.
¶3 	In 1982, the Parents’ son Richard, an attorney,
prepared nine trust documents on behalf of the Parents for the
benefit of himself, his brother Stephen, and their spouses and
children. 	The documents named Richard as trustee of eight of the
trusts and Richard’s wife, Mary Lee Allred, as trustee of the
trust for the benefit of Richard. 	In December 1982, the Parents
signed the trust documents along with a quitclaim deed conveying
a fifty-percent interest in the Property to the nine trusts. 	In
early 1983, the Parents signed another quitclaim deed conveying
the remaining fifty-percent interest to the nine trusts.
¶4 	Despite the conveyance to the trusts, the Parents
continued to act as landlords of the Property. 	They collected
rent from Qwest and reported it as income on their tax returns,
which were sometimes prepared by Richard. 	They made alterations
and repairs on the Property at Qwest’s request. 	They personally
negotiated and signed lease modifications and renewals with Qwest
in 1987, 1994, and 1999, always designating themselves as “owner”
in the lease agreements. 	They paid taxes on the Property and, in
accordance with the terms of the leases, received reimbursements
from Qwest. 	In the 1987 lease modification, they arranged for
Qwest to pay the taxes directly.
¶5 	In 1991, the Parents decided to donate the Property to
their church. 	They contacted Richard and asked him to convey the

3 	Nos. 20051049, 20060171
Property back to them. 	Richard refused. 	Over the next several
years, the Parents repeatedly made requests for the return of the
property both in person and through a series of letters to
Richard. 	In one letter, they set a deadline by which, if the
Property had not been returned, they would “have to proceed with
such action as [they] deem necessary.”
¶6 	Although Richard steadfastly refused to reconvey the
Property, he did not take any action to prevent the Parents from
managing the Property and receiving the rent until 2000--nine
years after the Parents first requested that the Property be
returned. 	In 2000, Richard contacted Qwest and executed a new
lease agreement that directed Qwest to pay rent to the trusts.
The new lease agreement purported to incorporate and ratify the
conditions and terms of all previous lease agreements executed by
the Parents.
¶7 	In February 2001, the Parents filed suit against the
nine trusts, Richard Allred individually and as trustee, and Mary
Lee Allred as trustee (collectively, the “Trusts”), alleging
causes of action for fraud, breach of fiduciary duty, and adverse
possession. 	The Trusts’ Answer included assertions that the
claims for fraud and breach of fiduciary duty were barred by the
statutes of limitations. 	The Trusts counterclaimed for an
accounting and return of trust funds received as rent.
¶8 	The Parents and Qwest moved to interplead the rent from
the Property. 	Although the district court had not yet ruled on
the Parents’ adverse possession claim, it denied the motion to
interplead the rent, holding as follows:
[T]he documents provided by Richard Allred
demonstrate that the property leased by QWEST
is owned by the trusts, David and Inez Allred
having conveyed it to the trusts in 1982.
Though plaintiffs assert that they have a
colorable claim to the lease rents, I don’t
see it. 	Rather, on the face of the documents
provided by the parties, the property is
owned by the trusts and the lease rents
should be paid to the trusts.
Thereafter, Qwest paid rent to the Trusts.
¶9 	The parties filed cross-motions for summary judgment on
the issue of adverse possession. 	The Trusts argued that, as a
matter of law, the Parents could not adversely possess the
Property through a tenant. 	Furthermore, they argued that any

1 260 P.2d 542 (Utah 1953).
Nos. 20051049, 20060171 	4
actions by the Parents in administering the Property as landlord
were taken on behalf of and with the permission of the Trusts.
The district court denied both motions for summary judgment on
the adverse possession issue, citing unresolved issues of
material fact.
¶10 	The Trusts filed a motion for summary judgment on the
issues of fraud and breach of fiduciary duty, claiming the causes
of action were barred by the applicable statutes of limitations.
In their reply, the Parents argued that Richard Allred’s
relationship to the Parents as son and occasional tax preparer
tolled the statutes of limitations. 	The district court granted
summary judgment for the Trusts on the Parents’ claims for fraud
and breach of fiduciary duty, holding that the claims were barred
by the statutes of limitations. 	The district court found that,
at the very latest, the Parents were aware of their cause of
action in 1993 when they wrote the letters demanding that Richard
return the Property.
¶11 	Before a scheduled trial on the Parents’ adverse
possession claim and the Trusts’ accounting counterclaim, the
Trusts filed a motion in limine seeking to exclude any evidence
that the Parents had obtained title by adverse possession through
their tenant. 	The Trusts argued that the Parents never had
actual possession of the property and cited Pender v. Jackson 1
for the proposition that a lease is not a “use” of the property
by which a claimant can satisfy the requirement of actual
possession. 	The district court granted the Trusts’ motion in
limine, excluding any evidence of the Parents’ adverse possession
through a tenant. 	Because the Parents’ claim for adverse
possession relied solely on the theory that they had used the
Property as landlord, the order effectively granted summary
judgment to the Trusts on the adverse possession claim.
¶12 	Thus, the only remaining claim was the Trusts’
accounting counterclaim for the rent paid by Qwest to the
Parents. 	The district court ruled that the statute of
limitations for the accounting claim limited the reach-back
period of the accounting claim to three years and awarded the
Trusts $127,800, the gross rents for that period. 	Before any
order was entered, Judge Schofield replaced Judge Stott, who had
to that point presided over the litigation. 	The Parents filed a
motion to alter or amend Judge Stott’s ruling. 	Following a one-
day bench trial on the issue of offsets, Judge Schofield
concluded that the parents had valid claims of waiver and
estoppel that had not previously been considered. 	In Judge

2 Utah R. Civ. P. 56(c).
3 See Peterson v. Coca-Cola USA, 2002 UT 42, ¶ 20, 48 P.3d
941.
4 See Krantz v. Holt, 819 P.2d 352, 353 (Utah 1991).
5 	Nos. 20051049, 20060171
Schofield’s view, Richard had waived his right to claim rents for
the Trusts by preparing and filing the Parents’ tax returns for
tax years 1994, 1995, 1996, and 1997. 	The Trusts were therefore
awarded nothing.
¶13 	After Judge Stott awarded back rent to the Trusts but
before Judge Schofield took over the case, the Trusts recorded a
notice of lis pendens on the Parents’ residence, a property
unrelated to the Property occupied by Qwest. 	After the notice
was recorded, Judge Schofield advised the parties that he would
reconsider the accounting award. 	The Parents then moved for the
removal of the lis pendens as an unauthorized cloud on the title.
Judge Schofield ordered the Trusts to remove the notice of lis
pendens and awarded the Parents $8,511.60 in fees and costs under
the lis pendens statute.
¶14 	In this appeal, the Parents assert that the district
court (1) erred by ruling that the Parents could not present
evidence of adverse possession through a tenant, (2) erred by not
granting summary judgment in their favor on the adverse
possession claim, and (3) erred by ruling that the Trusts’ claims
for fraud and breach of fiduciary duty were barred by the
statutes of limitations. 	The Trusts, on cross-appeal, assert
that Judge Schofield erred by improperly reconsidering and
reversing Judge Stott’s award on the accounting claim and in
awarding fees and costs in the matter of the lis pendens. 	We
have jurisdiction pursuant to Utah Code section 78-2-2(3)(j).
STANDARD OF REVIEW
¶15 	Summary judgment is appropriate only when there is no
genuine issue of material fact and the moving party is entitled
to judgment as a matter of law. 2 	The court must view all facts
and inferences in the light most favorable to the nonmoving
party, but it may not assume facts for which no evidence is
offered. 3 	We review a trial court’s order granting summary
judgment for correctness. 4
ANALYSIS

5 739 P.2d 1104, 1106 (Utah 1987); see also Utah Code Ann. §
78-12-7 (2002).
6 Reed, 739 P.2d at 1106; see also Utah Code Ann.
§ 78-12-12.
7 260 P.2d 542 (Utah 1953).
8 Id. at 543.
Nos. 20051049, 20060171 	6
¶16 	We will first address the Parents’ claim to the
Property by adverse possession through their tenant, Qwest.
Second, we will discuss the Parents’ argument that their causes
of action for fraud and breach of fiduciary duty are not barred
by the statutes of limitations. 	Finally, we will discuss the
Trusts’ cross-appeals on the accounting award and the award of
fees and costs related to the filing of the lis pendens.
I. 	ADVERSE POSSESSION
¶17 	The Parents argue that even if the 1982 and 1983 deeds
effectively conveyed the Property to the Trusts, the Parents
regained title to the Property through adverse possession. 	In
Royal Street Land Co. v. Reed, we explained that one who claims
property by adverse possession must show that his use and
possession of the property has been actual, open and notorious,
and continuous for the statutory period. 5 	A claimant must also
have paid all taxes levied on the property during the statutory
period. 6
A. 	A Claimant May Satisfy the Actual Possession Requirement
Through a Tenant
¶18 	The Parents claim that their possession of the Property
was adverse to the legal title holder because the Property was
continuously occupied by Qwest, a tenant in subordination to the
Parents, not the Trusts. 	The Trusts argue that the Parents
cannot satisfy the actual possession requirement because they
never occupied the Property personally. 	The Trusts cited Pender
v. Jackson 7 for the proposition that a lease is not a “use” of
the property by which a claimant can satisfy the actual
possession requirement. 8 	The district court agreed and ruled
that the Parents could not introduce evidence of adverse
possession through their tenant.
¶19 	We disagree with the district court's interpretation of
Pender and hold that a claimant may satisfy the actual possession
requirement by leasing property to a tenant. 	Notably, Pender was

9 Id.
10 Id. (internal quotation marks omitted).
11 Id.
12 Id.
7 	Nos. 20051049, 20060171
not a case involving a landlord and tenant. 	Instead, the
claimant in Pender was a land speculator who purchased tax deeds
and never occupied or made any use of the land, either personally
or through a tenant. 9 	In Pender, we disagreed with the
claimant’s contention that “‘holding the land for investment,
speculation, lease, or the like’” fulfills the actual possession
and occupation requirement of adverse possession codified in Utah
Code section 78-12-9. 10 	We noted that “[m]erely holding the land
for speculation is the purpose for which the land is held and not
the use of the land.” 11 	We denied the “adverse claim because the
necessary element of possession or occupation, as defined by the
Utah statute, [was] not established.” 12
¶20 	Unlike the claimant in Pender, the Parents did not
merely hold the land for speculation in anticipation of a lease
or a future sale. 	Instead, the Parents made actual use of the
Property by signing rental agreements with the tenant, collecting
and using the rental income, making repairs, and improving the
Property.
¶21 	“Actual possession” is a flexible term, and the use of
property necessary to establish it will vary with the character
of the property. 	This concept is certainly not novel or
exclusive to Utah law:
[P]ossession of land is the holding of, and
exclusive exercise of, dominion over it. 	It
is evident that this is not and cannot be
uniform in every case, and that there may be
degrees in the exclusiveness even of the
exercise of ownership. 	The owner cannot
occupy literally the whole tract--he cannot
have an actual pedis possessio of all, nor
hold it in the grasp of his hands. 	His
possession must be indicated by other acts.
The usual one is that of inclosure. 	But this
cannot always be done, yet he may hold the
possession in fact of uninclosed land by the
exercise of such acts of ownership over it as
are necessary to enjoy the ordinary use of

13 Colvin v. McCune, 39 Iowa 502, 506-07 (1874) (internal
quotation marks and citation omitted); see also 3 Am. Jur. 2d
Adverse Possession § 24 (2000) (“The requirement of actual
possession may be met or kept fresh through possession, on behalf
of the adverse claimant, by a tenant of the claimant.”).
14 Colvin, 39 Iowa at 505-06; 3 Am. Jur. 2d Adverse
Possession § 75.
15 Park West Vill., Inc. v. Avise, 714 P.2d 1137, 1139 (Utah
1986) (stating that claimant “entered into possession . . . and
continuously occupied the same, either personally or through her
tenants”); Michael v. Salt Lake Inv. Co., 345 P.2d 200, 201 (Utah
1959) (upholding claimants’ adverse possession claim where
claimants’ “representatives, tenants and successors” occupied the
property and paid taxes for the statutory period); e.g.,
Bozievich v. Slechta, 166 P.2d 239, 241 (Utah 1946) (stating that
claimant “intended to assert and did assert ownership to the
property by placing its tenants in possession, and did not
recognize any right of redemption in the original owner”).
Nos. 20051049, 20060171 	8
which it is capable, and acquire the profits
it yields in its present condition. 	Such
acts, being continued and uninterrupted, will
amount to actual possession; and, if under
color of title or chain of right, will be
adverse. 13
For example, a claimant to a rock quarry may satisfy the actual
possession requirement by entering the land to quarry and remove
rock; the claimant need not be domiciled on the quarry. 14 	In the
case of a rental property like that in dispute in this case, it
would be incongruous to hold that a claimant must necessarily
occupy the property personally, particularly when the utility and
value in a rental property is in collecting rent from tenants.
¶22 	We have only infrequently addressed the issue of
adverse possession through a tenant. 	In each case, however, we
assumed without discussion that a claimant could satisfy the
actual possession requirement through a tenant and, if all other
requirements were met, claim legal title to the property by
adverse possession. 15 	In the context of an unlawful detainer
action to recover a possessory right in federally owned school
land, we held that “[a]fter the land has thus been subjected to
the will and dominion of the claimant, there seems to be no sound
reason why such claimant may not keep control through an agent or

16 Hyndman v. Stowe, 33 P. 227, 229 (Utah 1893).
17 Dignan v. Nelson, 72 P. 936, 938 (Utah 1903).
18 Utah Code Ann. § 78-12-14.
19 See People v. Lapcheske, 86 Cal. Rptr. 2d 565, 569 (Ct.
App. 1999).
20 Utah Code Ann. § 78-12-12.
9 	Nos. 20051049, 20060171
tenant.” 16 	In another early case, we held, without discussion,
that the claimants’ possession of several lots “in person and by
their tenants” constituted “open, notorious, and exclusive
adverse possession.” 17 	The lack of discussion on the point may
well be because no party in the cases advanced the contention
that actual possession could not be met by renting the property
to a tenant. 	Furthermore, our research reveals no case in which
we denied a claimant’s adverse possession claim because the
claimant possessed the land through a tenant.
¶23 	In addition to our caselaw, Utah statutory law provides
that “the possession of the tenant is the possession of the
landlord.” 18 	While the most obvious purpose of the statute is to
shield landlords from adverse possession claims by their tenants,
its plain language supports our conclusion that whoever is acting
as landlord to the tenant is in actual possession of the property
for the purpose of an adverse possession claim. 	Thus, we agree
with the Parents that a claimant may satisfy the actual
possession requirement of an adverse possession claim by placing
a tenant on the land and collecting the rent for the claimant’s
own benefit.
¶24 	A claimant who places a tenant on the land must still
meet all other requirements of adverse possession. 	Renting the
property to a tenant and collecting the rent for the claimant’s
own use is not hostile to the legal title owner when it is done
in subordination to the legal title owner. 19 	Thus, a sublease or
any lease recognizing the legal title owner will not meet the
hostility requirement. 	In addition, the claimant must pay all
taxes levied on the land, and his possession must be continuous
for the statutory period. 20
¶25 	In this case, the district court ruled that the Parents
could not, as a matter of law, introduce evidence of actual
possession through their tenant, Qwest. 	Because we hold that a
claimant may satisfy the actual possession requirement through a
tenant, we reverse.

21 Lapcheske,86 Cal. Rptr. 2d at 569.
Nos. 20051049, 20060171 	10
B. 	The Parents Are Entitled to Summary Judgment on Their Adverse
Possession Claim
¶26 	Prior to the district court’s determination that the
Parents could not present evidence of adverse possession through
their tenant, the district court denied the Parents’ motion for
summary judgment on the issue of adverse possession, citing
unresolved issues of fact. 	The Parents challenge this ruling on
appeal. 	In light of our holding that a claimant may satisfy the
actual possession requirement of adverse possession through a
tenant, we reverse the district court’s ruling and hold that the
undisputed facts show that the Parents possessed the Property
adverse to the Trusts for the statutory period.
¶27 	Following the 1982 and 1983 deed conveyances, the
Parents continued to act as landlord to Qwest by collecting rent,
managing the Property, negotiating lease agreements, and making
repairs. 	The possession was open and notorious, putting the
Trusts on notice that the Parents were acting as the landlord of
the property. 	Richard was put on notice because he prepared the
tax returns for the Parents on which they reported the rental
income from the Property. 	Acting as landlord and collecting the
rent for personal use is, as discussed above, actual possession
of the land. 	Furthermore, such actions are prima facie hostile
to the claim of the legal title owner unless done in
subordination to the legal title owner. 21
¶28 	Here, the Trusts argue that the Parents’ management of
the Property was in subordination to the Trusts. 	At various
times during the litigation, the Trusts attempted to present
testimonial evidence of a secret agency arrangement between David
and Richard whereby the Parents would continue to enjoy the
profits from the Property during their lifetime despite legal
ownership by the Trusts. 	Whether such an arrangement existed and
whether that arrangement negated the hostile character of the
possession would, under most circumstances, be factual issues for
trial.
¶29 	Regardless of whether there was such an arrangement at
one time, however, the dispute between the parties that arose in
1991 when the Parents attempted to donate the Property to their
church is inconsistent with the secret agency arrangement
continuing beyond that date. 	The Parents made an unequivocal
claim of ownership and continued for an additional nine years as
landlords of the Property until 2000, when Richard contacted

22 Utah Code Ann. § 78-12-12.
11 	Nos. 20051049, 20060171
Qwest and executed a new lease agreement. 	Any permissive
arrangement that might have existed prior to the 1991 dispute
could not have endured beyond that date. 	Despite the Parents’
apparent exercise of dominion over the Property, the Trusts did
not bring a cause of action during the seven-year statutory
period. 	Even if we assume, as the Trusts suggest, that a secret
agency relationship existed beginning in 1982, the Parents have
nevertheless met the requirement of actual possession of the
property that was hostile to the legal title holder and
continuous for the statutory period.
¶30 	Finally, the Parents were required to pay taxes on the
land throughout the statutory period. 22 	It is undisputed that
the Parents paid the taxes until 1987. 	In 1987, 1994, and 1999,
the Parents entered into lease agreements directing Qwest to pay
the taxes directly. 	Just as the Parents may satisfy the actual
possession requirement through the possession of their tenant, so
too they may satisfy the requirement to pay taxes by directing
their tenant to pay the taxes as part of the lease agreement. 	In
this case, the Parents, not the Trusts, entered into the lease
agreements directing that Qwest pay the property taxes. 	Thus the
Parents have satisfied the requirement to pay taxes on the
Property.
¶31 	Even with all inferences drawn in favor of the Trusts,
the Parents are nevertheless entitled to judgment as a matter of
law on their adverse possession claim. 	Therefore, we reverse the
decision of the district court and remand with instructions to
enter summary judgment in favor of the Parents on their adverse
possession claim quieting title to the Property in them and for
further proceedings consistent with this opinion.
II. 	STATUTES OF LIMITATIONS
¶32 	The Parents challenge the district court’s ruling on
summary judgment that their causes of action for fraud and breach
of fiduciary duty against Richard are barred by the applicable
statutes of limitations. 	The Parents argue that the statutes of
limitations were tolled through 1999 because Richard continued to
act as a fiduciary to the Parents until he redirected the rent.
The district court found that the Parents were aware of the
conveyance and any cause of action related to it no later than
1993, when the Parents wrote a letter to Richard demanding the
return of the Property. 	We find no error in the district court’s
analysis and affirm.

23 Colosimo v. Roman Catholic Bishop of Salt Lake City, 2007
UT 25, ¶ 11, 156 P.3d 806.
24 Compare Utah Code Ann. § 78-12-26(3), with Utah Code Ann.
§ 78-12-25(3); see also Kamas Sec. Co. v. Taylor, 226 P.2d 111,
118 (Utah 1950) (holding that the statute of limitations
governing claims for breach of fiduciary duty was the predecessor
to Utah Code section 78-12-25(3)).
25 Utah Code Ann. § 78-12-26(3).
26 2005 UT 14, ¶ 22, 108 P.3d 741.
Nos. 20051049, 20060171 	12
¶33 	The Parents’ fraud and breach of fiduciary duty claims
relate to the 1982 and 1983 deed conveyances. 	They claim that
Richard, acting as attorney and advisor to his parents, deceived
them into signing the deeds conveying the Property to the Trusts.
The alleged fraudulent activities occurred nineteen years before
the 2001 lawsuit was filed. 	Nevertheless, the Parents argue that
the discovery rule prevents their causes of action from being
barred by the applicable statutes of limitations. 	“The discovery
rule can toll the statute of limitations when there is (1) a
statutory tolling provision, (2) an exceptional circumstance, or
(3) fraudulent concealment.” 23 	We address each of these bases
for tolling in turn.
A. 	Statutory Tolling Provision
¶34 	While the statute of limitations for fraud found in
Utah Code section 78-12-26(3) contains a statutory tolling
provision, the statute of limitations for breach of fiduciary
duty found in Utah Code section 78-12-25(3) does not. 24 	Utah
Code section 78-12-26(3) requires that a cause of action for
fraud must be brought within three years, “except that the cause
of action in such case does not accrue until the discovery by the
aggrieved party of the facts constituting the fraud.” 25 	We
explained the application of the statutory discovery rule for
fraud claims in Russell Packard Development, Inc. v. Carson:
[W]hen a plaintiff first has actual or
constructive knowledge of the relevant facts
forming the basis of the cause of action--the
statutory limitations period begins to run
and a plaintiff who desires to file a claim
must do so within the time specified in the
statute. 	Otherwise, the claim will be
barred. 26

27 Colosimo, 2007 UT 25, ¶ 19 (quoting Russell Packard Dev.,
Inc., 2005 UT 14, ¶ 25).
28 Id. (quoting Burkholz v. Joyce, 972 P.2d 1235, 1237 (Utah
1998) (alteration in original)).
13 	Nos. 20051049, 20060171
¶35 	Considering that the Parents continued to exercise
control as owners of the Property following the conveyance, it is
certainly plausible that they did not discover the facts forming
the basis of their fraud claim immediately after the 1982 and
1983 conveyances. 	However, the Parents were aware of those facts
by 1991 when they asked Richard to return the Property so that
they could donate it. 	If not then, they were indisputably aware
by the time they wrote a letter to Richard dated January 15,
1993, demanding that Richard sign deeds conveying the Property
back to the Parents by February 15 of that year and stating:
“Richard, whatever your decision on February 15th, let’s have it,
either give us your signature as we have asked on the enclosed
form, or go about your way of ignoring us. 	We will then know how
to proceed in either event of your choice.” 	The Parents did not
file an action until eight years later in 2001. 	The statutory
discovery provision does not toll the statute of limitations in
this case because the Parents were aware of the facts
constituting the alleged fraud.
B. 	Exceptional Circumstance
¶36 	The Parents next argue that the applicable statutes of
limitations for both fraud and breach of fiduciary duty were
subject to tolling under the exceptional circumstances doctrine.
“Under this doctrine, the limitations period is tolled ‘where the
case presents exceptional circumstances and the application of
the general rule would be irrational or unjust, regardless of any
showing that the defendant . . . prevented the discovery of the
cause of action.’” 27 	In light of the Parents’ threat to pursue
and apparent ability to pursue a cause of action in a timely
manner and Richard’s steadfast refusal to return the Property, we
cannot say that the parties were in grossly unequal positions or
that the application of the statutes of limitations to this case
would be irrational or unjust. 	Moreover, “[f]or this exception
to apply, ‘an initial showing must be made that the plaintiff did
not know and could not reasonably have discovered the facts
underlying the cause of action in time to commence an action
within [the limitations period].’” 28 Once again, in light of the
fact that the Parents were indisputably aware of the facts
underlying their cause of action, the discovery rule does not
apply in this case.

Nos. 20051049, 20060171 	14
C. 	Fraudulent Concealment
¶37 	Finally, the Parents argue that the statutes of
limitations for fraud and breach of fiduciary duty were tolled by
the fraudulent concealment doctrine because Richard continued to
act as a fiduciary, allegedly misleading them into believing that
he would work with them in resolving the dispute. 	But while the
Parents allege fraud, they fail to allege concealment. 	It would
be circular to toll the statute of limitations for fraud or
breach of fiduciary duty merely because the defendant commits
fraud or breaches a fiduciary duty without some further showing
that the defendant also concealed it from the plaintiff. 	By
their own admission in their letters, the Parents were aware of
the facts forming the basis of their causes of action.
Furthermore, the possibility that the parties might have worked
out another solution outside of court or that Richard allegedly
cajoled them into not filing a lawsuit does not preserve the
Parents’ late-filed claim.
¶38 	Therefore, we affirm the district court’s ruling that
the Parents’ causes of action for fraud and breach of fiduciary
duty are barred by the applicable statutes of limitations.
III. 	RECONSIDERATION OF THE ACCOUNTING CLAIM AWARD
¶39 	The Trusts challenge the district court’s
reconsideration and ultimate withdrawal of the $127,800 judgment
previously awarded to the Trusts on their accounting claim.
Judge Stott never entered the award as a final order. 	Upon
reconsideration, Judge Schofield, who replaced Judge Stott, ruled
against the Trusts on the claim. 	The Trusts assert that
reconsideration was procedurally improper and substantively
incorrect. 	The accounting claim was premised, however, on the
district court’s determination that the Trusts owned the
Property. 	In light of our conclusion that the Trusts do not own
the Property, we need not reach the question of whether Judge
Schofield properly reconsidered the award. 	The Trusts are not
entitled to any of the rental income. 	We affirm the district
court’s ruling that the Trusts are not entitled to an award on
their accounting claim.
IV. 	AWARD OF ATTORNEY FEES AND COSTS UNDER THE LIS PENDENS
STATUTE
¶40 	The district court, on summary judgment, ordered
removal of the notice of lis pendens from the Parents’ residence
and awarded fees and costs to the Parents. 	We find no error in

29 Utah Code Ann. § 78-40-2 (2002).
30 Utah Code § 78-40-2.5 (Supp. 2007); Eldridge v.
Farnsworth, 2007 UT App 243, ¶ 42, 166 P.3d 639.
31 Utah Code Ann. § 78-40-2.5(3).
32 Id. § 78-40-2.5(7).
15 	Nos. 20051049, 20060171
the district court’s analysis and affirm the award and order to
remove the lis pendens.
¶41 	Utah Code section 78-40-2 authorizes a party to record
a lis pendens or notice of an action pending “[i]n any action
affecting the title to, or the right of possession of, real
property.” 29 	Section 78-40-2.5 provides property owners or
parties to the action with a procedure with which to secure a
release of the lis pendens under certain circumstances. 30 	In
such an action, section 78-40-2.5 requires that the “court shall
order a [lis pendens] released if . . . the court finds that the
claimant has not established by a preponderance of the evidence
the probable validity of the real property claim that is the
subject of the [lis pendens].” 31 	Furthermore, the statute
provides for the award of attorney fees and costs to the
prevailing party unless “the nonprevailing party acted with
substantial justification; or . . . other circumstances make the
imposition of attorney fees and costs unjust.” 32
¶42 	In this case, the Trusts never alleged any claim
affecting title to or possession of the Parents’ residence.
Furthermore, at the time of the hearing on the action to remove
the lis pendens, the Trusts did not have a judgment related to
either the residence or the Property, Judge Schofield having
advised the parties that he would reconsider the accounting award
before entering a final order. 	The district court correctly held
that the Trusts proceeded without substantial justification to
litigate their right to leave a notice on the title of the
Parents’ residential property. 	We affirm the district court’s
grant of summary judgment in favor of the Parents for fees and
costs related to removing the lis pendens from the Parents’
residential property.
CONCLUSION
¶43 	We reverse the district court’s order excluding
evidence of the Parents’ claim of adverse possession through
their tenant. 	In addition, we reverse the district court’s
denial of summary judgment to the Parents on their adverse

Nos. 20051049, 20060171 	16
possession claim and remand with instructions for the district
court to enter summary judgment in the Parents’ favor and for
such other proceedings as are consistent with this opinion. 	We
affirm the district court’s ruling that the Parents’ claims for
fraud and breach of fiduciary duty are barred by the statutes of
limitations. 	And as the Trusts do not own the Property and are
not entitled to the rental income, we affirm the district court’s
withdrawal of the accounting award. 	Finally, we affirm the
district court’s award of costs and fees to the Parents for
prevailing in their action to remove the notice of lis pendens.
---
¶44 	Chief Justice Durham, Associate Chief Justice Wilkins,
Justice Parrish, and Justice Nehring concur in Justice Durrant’s
opinion.