Limitations of Action: Royalty Litigation Royalties and Royalty Interests: Limitations of Action

摘要

In September 1993, Texaco sends a letter to Thomas Nygaard, as trustee for the Daisy Keith Trust (the 'Trust"), informing him that certain royalties due the Trust are being held in suspense by Texaco's predecessor, Getty Oil Co. After Nygaard provides the documentation requested in the letter, the suspended royalties are paid to the Trust. In July 1996, Nygaard submits an independent study to Texaco purporting to show that additional royalties are due the Trust. In June 2002, Nygaard (in his capacity as trustee) sues Texaco, Getty, and J.R. Pounds Inc., who had purchased the field from Texaco. The suit seeks unpaid royalties and alleges fraud, deceit, and conversion. The trial court holds that all claims over three years old are barred by Mississippi's three-year statute of limitations for causes Of action that are not subject to any other specific limitations period. Nygaard appeals, claiming that a ten-year limitations period applies, or alternatively mat fraudulent concealment tolls the limitations period. Held: affirmed. The court of appeal rejects Nygaard's argument that the ten-year limitation period for claims for recovery of an interest in land applies to a claim for accrued royalties, finding that accrued royalty interests are personal property. There being no other applicable statute, the general three-year limitation period applies. The court declines to consider Nygaard* s constructive trust argument because it was not asserted in his complaint, but notes mat the Trust's relationship with the defendants was contractual, and there was no evidence the defendants agreed to assume a trust relationship. Nygaard's fraudulent concealment claim is rejected because his receipt of the check from Texaco in 1993 was sufficient to put him on notice and impose a duty to investigate.