Jill Hansen, et al., Appellants,

This opinion will be unpublished and
may not be cited except as provided by
Minn. Stat. § 480A.08, subd. 3 (2016).

STATE OF MINNESOTA
IN COURT OF APPEALS
A17-1608

Jill Hansen, et al.,
Appellants,

vs.

U. S. Bank National Association,
as Special Administrator and Personal Representative
of the Estate of Robert J. Hansen,
Respondent.

Filed July 2, 2018
Affirmed
Schellhas, Judge

Hennepin County District Court
File No. 27-CV-17-3332

Richard W. Huffman, James T. Smith, Huff man, Usem, Crawford & Greenberg, P.A.,
Minneapolis, Minnesota (for appellants)

Martin S. Fallon, Leora M. Maccabee, Maslon LLP, Minneapolis, Minnesota (for
respondent)

Considered and decided by Schellhas, Presiding Judge; Reyes, Judge; and Randall,
Judge.
*

* Retired judge of the Minnesota Court of Appeals, serving by appointment pursuant to
Minn. Const. art. VI, § 10.

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U N P U B L I S H E D O P I N I O N
SCHELLHAS, Judge
Appellants challenge the dismissal of their breach-of-fiducia ry-duty and unjust-
enrichment claims against resp ondent, arguing that the district court erred in concluding
that their claims are barred by the applicable six-year statute of limitations. We affirm.
FACTS
In August 2009, Robert Hans en (Robert) and his brother, Bryan Hansen, agreed to sell
certain real property (the property) located in the City of Vadnais Heights to Community
Facilities Partnership of Vadnais Heights, LLC (CFP) for approximately $4.6 million. CFP
intended to develop a nd construct a sports complex on the property and to finance its
acquisition and construction of the sports complex project through the city’s issuance of tax-
exempt revenue bonds. The city would then be the “master lessee” of the sports complex.
Under the terms of the purchase agreement, CFP agreed to pay the sellers $2.5 million
cash at closing and the balance of $2 million under a tax-exempt subordinate note or notes,
(the note) issued by the city. The parties contemplated that CFP or its designated payor would
make the note payments to the sellers, using the sports-center lease revenue. Although the
purchase agreement stated that the city’s leas e payments would be “s ufficient to pay the
amounts due on the Bonds and the Note,” the agreement also stated that “payments on the
Note are to be subordinate . . . to operating expenses of the Project and debt service on the
Bonds.” The purchase agreement required CFP to provide the sellers with
a five-year compiled financia l forecast prepared by an
independent firm of certified public acc ountants or other
independent financial consultant which shows that projected net

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operating income of the Projec t is more than the amount
necessary to pay the debt service on the Buyer’s financing for
such improvements and the debt service on the Bonds and the
Note.

Robert died on November 22, 2009, leaving as beneficiaries of his estate his daughter
and grandson, appellants Jill Hansen and Leif Layman. To supervise the closing of the sale
of the property, the probate court appointed respondent U.S. Bank (the bank) and Barbara
Pagel as co-special administrators of Robert’s estate.1 In April 2010, the purchase agreement
was amended, changing, among other things, the amount of cash due at closing, and requiring
that:
[p]rior to closing, an independe nt certified public accounting
firm or financial prof essional selected by Seller shall forecast
more than enough net operating income is expected to pay the
debt service on all improveme nts and on all Tax-Exempt and
Taxable Bonds and Taxable Notes applicable to this Project, its
operation, and the property retained by the Buyer herein.

But the bank and Pagel did not select an independent certified public accounting firm or
financial professional to conduct the required forecast. The sale of the property nevertheless
closed on April 27, 2010, and the probate court entered an “Order Allowing Account and
Discharging Special Administrator,” finding that the “Special Administrator has otherwise
complied with all the orders of the court, wi th the provisions of applicable law, and fully
discharged the duties of the Sp ecial Administrator.” On April 30, 2010, the probate court
appointed the bank and Pagel as co-personal representatives of Robert’s estate.

1 Barbara Pagel is Robert’s former wife, the mother of Jill Hansen, and the grandmother of
Leif Layman.

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The sports complex experi enced revenue shortfalls, and in August 2012, the city by
resolution ceased its support of the sports complex. Robert’s estate consequently stopped
receiving payments under the note. In January 2017, appellants commenced this action in
district court against the ba nk, alleging breach of fiduciary duty a nd unjust enrichment.
Appellants claimed that the bank breached its fiduciary duties as co-special administrator of
Robert’s estate by (1) failing to require CFP to provide the sellers with financial forecasts of
the sports complex as required by the purchase agreement; (2) failing to select an independent
certified public accounting firm to forecast C FP’s ability to service the debt on the sports
complex as required by the amended purchase agreement; and (3) failing to require CFP to
demonstrate that the lease with the city was sufficient to pay the sports complex’s operating
expenses and note payments as required by the amended purchase agreement. Appellants also
claimed that the bank breached its fiduciary duty as personal representative of Robert’s estate
by failing to “hold itself liable for the damages caused by the breaches identified.” Appellants
further alleged that the bank wa s unjustly enriched “for all payments it received from
[Robert’s] Estate in association with and arising out of its breach of its fiduciary duties to the
Estate and the closing of the sale of the property in April 2010.”
The bank moved to dismiss the complain t under Minn. R. Civ. P. 12.02(e) or,
alternatively, for summary judgment under Minn. R. Civ. P. 56.02. The bank argued that
appellants’ claims are barred by the applicable statute of limitations and the doctrines of res
judicata and collateral estoppel. The district court conc luded that appellants’ breach-of-
fiduciary-duty claims against the bank, both as both special administrator and personal
representative, are “based solely on the actions, or inactions, of [the bank] which occurred

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prior to the sale of the property in April 2010.” The court also conc luded that appellants
“suffered ‘some’ damage when [the bank] closed on the sa le of the property without,
allegedly, performing the required due dili gence.” Because appellants suffered “some”
damage at the time the sale closed in Apr il 2010, but did not commence their action until
January 2017, the court concluded that more than six years had passed, and that appellants’
breach-of-fiduciary-duty claim therefore is barred by the six-year statute of limitations.
The district court also concluded that a ppellants’ unjust-enrichment claim is barred
by the six-year statute of limitations because appellants “have not filed anything, and there
is nothing in the record,” to contradict the conclusion in the 2012 scheduling order that the
bank’s special-administrator fees were addr essed in the probate court’s April 30, 2010
discharging order. The court therefore granted the bank’s moti on to dismiss under rule
12.02(e), concluding that appellants’ claims are barred by the statute of limitations. In
reaching its conclusion, the court did not address the bank’s arguments based on collateral
estoppel and res judicata.
This appeal follows.
D E C I S I O N
Appellants challenge the district court’s ru le 12.02(e) dismissal of their breach-of-
fiduciary-duty and unjust-enrichment claims. “When a case is dismissed pursuant to Minn.
R. Civ. P. 12.02(e) for failure to state a claim for which re lief can be granted, [appellate
courts] review the legal sufficiency of th e claim de novo to determine whether the
complaint sets forth a legally sufficient claim for relief.” Graphic Commc’ns Local 1B
Health & Welfare Fund “A” v. CVS Caremark Corp., 850 N.W.2d 682, 692 (Minn. 2014).

6
In so doing, appellate courts “accept the facts alleged in the complaint as true and construe
all reasonable inferences in fa vor of the nonmoving party.” Frederick v. Wallerich , 907
N.W.2d 167, 172 (Minn. 2018 ) (quotation omitted). “[Appella te courts] therefore rely
principally on the allegations of the complaint for the factual record.” Id. at 170. We also
consider statements or documents incorporated in or atta ched to a compla int as exhibits.
Minn. R. Civ. P. 10.03 (“A copy of any written instrument which is an exhibit to a pleading
is part of the statement of claim or defense set forth in the pleading.”). “A district court
may only dismiss a complaint under Rule 12.02(e) if it appears to a certainty that no facts,
which could be introduced consistent with the pleading, exist which would support granting
the relief demanded.” Finn v. Alliance Bank, 860 N.W.2d 638, 653 (Minn. 2015) (quotation
omitted). But “[appellate courts] are not bound by legal conclusions stated in a complaint
when determining whether the complaint survives a motion to dismiss for failure to state a
claim.” Id. at 653–54 (quotation omitted).
The parties agree that appellants’ claims are subject to the six-year statute of
limitations period set forth in Minn. Stat. § 541.05, subd. 1 (2016). “The statute of
limitations begins to run on a claim when ‘the cause of action accrues.’” Park Nicollet
Clinic v. Hamann , 808 N.W.2d 828, 832 (Minn. 2 011) (quoting Minn. Stat. § 541.01
(2010)). “Accrual is the point at which a plaintiff can allege sufficient facts to survive a
motion to dismiss for failure to state a claim on which relief can be granted.” Frederick,
907 N.W.2d at 173 (quotation omitted). This court reviews “de novo the construction and
application of a statute of limitations, including the law governing the accrual of a cause of
action.” Sipe v. STS Mfg., Inc., 834 N.W.2d 683, 686 (Minn. 2013) (quotation omitted).

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Minnesota follows the damage-accrual rule. Antone v. Mirviss , 720 N.W.2d 331,
336 (Minn. 2006). Under this rule, the stat ute of limitations be gins to run once any
compensable damages occur. Id. Also known as the “some damage rule,” the damage-
accrual rule is broadly defined “to include any damage, regardless of whether that damage
was alleged in the complaint.” Frederick, 907 N.W.2d at 178 (emphasis added) (quotation
omitted). And the “ability to ascertain the exact amount of damages is not dispositive with
respect to the running of the statute of limitations.” Antone, 720 N.W.2d at 338.
Breach-of-fiduciary-duty claim
Appellants alleged that “[the bank] and Barbara Pagel as co-special administrators of
the Estate failed to obtain the five-year compiled forecast from CFP prior to the closing as
required by the August 2009 Pu rchase Agreement and Ame nded Purchase Agreement.”
Appellants further alleged that “[i]t has been later discovered that at the time of the Closing,
two reports or forecasts had been prepared and provided to CFP and/or the City. Both reports
forecasted that revenue projections were overstated and incorrectly or erroneously relied upon
unsupported revenue commitments and sources.”
“To prevail on a claim of breach of fiduc iary duty, a plaintiff must prove four
elements: duty, breach, causation, and damages.” TCI Bus. Capital, Inc. v. Five Star Am.
Die Casting, LLC, 890 N.W.2d 423, 434 (Minn. App. 2017).
Alleged breach as special administrator
Appellants argue that the district court erroneously concluded that they suffered
“some damage” at the time of the April 2010 closing because the “facts pleaded in this case
plainly allege that until 2012, the bonds [fu nding the note] had not defaulted nor caused

8
[Robert’s] Estate any damage.” Appellants argue that their claim therefore did not accrue,
and the statute of limitations did not begin to run, until August 2012, when the estate
stopped receiving payment on the note. We disagree.
In Frederick, our supreme court discussed when “some damage” occurred in the
context of a legal malpractice claim. 907 N.W. 2d at 178–79. In that case, the plaintiff
brought a legal-malpractice action against hi s attorney who prepar ed an unenforceable
antenuptial agreement. Id. at 171. The supreme court concluded that as a result of the failed
execution of an antenuptial agreement, some damage occurred, and the statute of
limitations began to run, when the parties married.2 Id. at 179.
In reaching its conclusion, the supreme court relied upon Antone, which
“specifically addressed the ‘some damage’ rule in the context of an antenuptial agreement.”
Id. at 178 (citing Antone, 720 N.W.2d at 335). In Antone, the supreme court established a
rule that “some damage” occurred at the “ point of no return” wh en the plaintiff was
“expos[ed]” to “a claim upon a portion of any appreciation of his premarital property.” 720
N.W.2d at 337. The supreme court concluded that this “point of no return” was the date of
marriage because “some damage” occurred on that date when each member of the couple
lost the right to protect hi s or her premarital assets. Id. at 337–38 (concluding that
“exposure” to “a claim upon a portion of any appreciation in [the] premarital property”
constituted “an injury that resulted in some damage”).

2 Although the supreme court in Frederick also considered whether “multiple acts of legal
malpractice can give rise to independent cause s of action, each having a separate accrual
date under an applicable statute of limitations,” that issue is not before us in this case. Id.
at 174.

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In this case, when the sale of the property closed without the required forecast that
“more than enough net operating in come [was] expected to pay debt service on all . . .
Taxable Notes,” appellants reached the “point of no return” beca use they lost the
opportunity to demand the forecast, to renegotiate the terms of the purchase agreement, or
to cancel the purchase agreement. Although the precise amount of appellants’ damages
may not have been readily ascertainable when the sale closed and was not alleged in their
complaint, appellants incurred “some damage” when the closing occurred, and the statute
of limitations began to run on that date. Appellants commenced their action against the
bank in January 2017, mo re than six years after the closing on the sale of the property in
April 2010. The district court therefore di d not err by concluding that the statute of
limitations barred appellants’ breach-of-fiduciary-duty claim.
Alleged breach as personal representative
Appellants contend that the district c ourt erroneously dismissed their breach-of-
fiduciary-duty claim against the bank in its capacity as personal representative. Appellants
argue that even if the statute of limitations began to run at the time of the closing, the bank’s
subsequent “silence constituted fraudulent misrepresentation that tolled the statute of
limitations.” Appellants do not claim that the bank made any affirmative, false statements
to them.
“Under the common law, a party may be liable for fraud either by making an
affirmative statement that is false or by co ncealing or not disclosi ng facts under certain
circumstances.” Graphic Commc’ns, 850 N.W.2d at 695. “[I]f a fiduciary duty existed the
fiduciary could be liable for fraudulent misrepresentation by silence even though there was

10
no evidence of fraudulent statements or intentional concealment.” Toombs v. Daniels, 361
N.W.2d 801, 809 (Mi nn. 1985) (quotation omitted). “Fra udulent concealment tolls the
statute of limitations until the party discovers, or has a reasonable opportunity to discover,
the concealed defect.” Hydra-Mac, Inc. v. Onan Corp., 450 N.W.2d 913, 918 (Minn. 1990).
“The 6-year period begins to run when the facts constituting fraud were discovered or, by
reasonable diligence, should have been discovered.” Toombs, 361 N.W.2d at 809.
“In all averments of fraud or mistake, the circumstances constituting fraud or
mistake shall be stated with particularity.” Minn. R. Civ. P. 9.02. “[Appellate courts] may
independently review the sufficiency of the complaint under rule 12.02(5) and determine
on its face whether it is barred by the statute of limitations.” Pederson v. Am. Lutheran
Church, 404 N.W.2d 887, 889 (Minn. App. 1987), review denied (Minn. June 30, 1987).
“[D]ismissal [is] proper under rule 12.02(5) only if it clearly and unequivocally appears
from the face of the complaint that the statute of limitati ons has run and only if the
complaint contains no facts to toll that running.” Id.
Here, the district court concluded that:
The Record . . . is devoid of a ny allegation against [the bank]
for fraud or concealment of an y fact. Additionally, there is
nothing in the Record stating that [appellants] were unaware of
the sale of Property, the terms of this sale, or the requirements
of the 2009 Purchase Agreement or the Amended Purchase
[Agreement]. Given the Record submitted, there was nothing
preventing [appellants], with du e diligence, from discovering
[the bank]’s failure to obtain required forecasts when the
Property was sold. The statut e of limitations is not tolled
simply because [appellants] ignor ed the sale of the Property
and its terms until a ‘later’ date.

Based on our de novo review of the record, we agree with the district court.

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Appellants’ complaint contains no particul ar date on which the alleged fraudulent
concealment began. Presumab ly, the bank’s alleged fraudulent concealment by silence
began no later than the day on which the probat e court appointed it to serve as a personal
representative. As noted above, appellants’ mother and grandmother, Barbara Pagel, served
as co-special administrator with the bank for the purpose of effectuating the closing of the
property. Appellants do not asse rt that they requested, and th e bank denied, copies of the
original or amended purchase agreements or any related closing documents. And appellants
do not assert that their mother and grandmother could not or did not share the documents
with them.
We agree with the district court that the record contai ns nothing to suggest that
appellants, with reasonable diligence, could not have discovered the bank’s alleged breach
of fiduciary duty. “Ordinarily, a plaintiff’s due diligence and the existence of a fiduciary
relationship will be questions of fact for a jury, but where the evidence leaves no room for
a reasonable difference of opinion, the court ma y properly resolve fact issues as a matter
of law.” Hope v. Klabal, 457 F.3d 784, 791 (8th Cir. 2006) (discussing Toombs) (quotation
omitted). Under the circumstances here, withou t pleading any facts to suggest that the
bank’s alleged fraudulent concealment preven ted appellants from discovering the bank’s
alleged breach of fiduciary duty, we conclu de that appellants’ complaint, on its face,
“clearly and unequivocally” demonstrates that the statute of limitations was not tolled and
therefore has run on appellants’ breach-of-fiduciary-duty claims against the bank as special
administrator and personal representative.

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Unjust-enrichment claim
To establish an unjust-enrich ment claim, the claimant must show that the defendant
has knowingly received or obtained something of value for which the defendant “in equity
and good conscience” should pay. Klass v. Twin City Fed. Sav. & Loan Ass’n , 291 Minn.
68, 71, 190 N.W.2d 493, 494–95 (1971). “[U]nj ust enrichment claims do not lie simply
because one party benefits from the efforts or obligations of others, but instead it must be
shown that a party was unjustly enriched in th e sense that the term ‘unjustly’ could mean
illegally or unlawfully.” ServiceMaster of St. Cloud v. GAB Bus. Servs., Inc., 544 N.W.2d
302, 306 (Minn. 1996) (quoting First Nat’l Bank v. Ramier, 311 N.W.2d 502, 504 (Minn.
1981)).
Appellants argue that like their breach-of-fi duciary-duty claim, their cause of action
for unjust enrichment as spec ial administrator would not ha ve accrued against the bank
until the August 2012 default on the note. We disagree. Any unjust-enrichment claim
against the bank accrued when th e bank, as co-special admini strator, allowed the sale of
the property to close in April 2010 without first selecting a certified public accounting firm
or financial professional to forecast that enough net operating income was expected to pay
the note. Appellants allegedly incurred some damage when the probate court addressed the
bank’s special-co-administrator fees in its April 30, 2010 order discharging the special co-
administrators. Appellants’ unjust-enrichment claim accrued in April 2010, more than six
years before appellants commenced their ac tion against the bank. The district court
therefore did not err by conclu ding that the statute of limita tions bars appellants’ unjust-
enrichment claim. Because the statute of lim itations bars appellants’ breach-of-fiduciary-

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duty claims and unjust-enrichme nt claims, we need not addr ess the bank’s alternative
arguments in support of affirmance. See Court Park Co. v. County of Hennepin , 907
N.W.2d 641, 645 n.4 (Minn. 2018) (declining to address issue when deciding case on other
grounds and addressing issue would not alter outcome of case).
Affirmed.