              UNITED STATES COURT OF APPEALS
                   For the Fifth Circuit



                       No. 99-40041



         PAUL M. DUTHU; LEE ROY DUTHU; REX DUTHU;
               HERMAN DUTHU; RUBY M. DUTHU,

                                        Plaintiffs-Appellants,


                          VERSUS


                 RUBEN PENA, ETC., ET AL.,

                                                    Defendants,

        RUBEN PENA, Individually and as Co-Executor and
       Co-Trustee of the McGarr Estate and Trust, and as
    Member of the Law Firm of Jones, Galligan, Key & Pena,
   and as Member of the Law Firm of King & Pena; FOREST L.
JONES, Individually and as Member of the Law Firm of Jones,
 Galligan, Key & Pena; ROBERT L. GALLIGAN, Individually and
as Member of the Law Firm of Jones, Galligan, Key and Pena;
 HARLINGEN NATIONAL BANK, In Its Corporate Capacity and as
  Successor in Interest to Town and Country National Bank;
       TERRY D. KEY; JONES, GALLIGAN, KEY & LOZANO, LLP,

                                         Defendants-Appellees.


     -------------------------------------------------



                       No. 99-40190



         PAUL M. DUTHU; LEE ROY DUTHU; REX DUTHU;
               HERMAN DUTHU; RUBY M. DUTHU,
                                          Plaintiffs-Appellants,


                           VERSUS


                 RUBEN PENA, ETC.; ET AL.,

                                                     Defendants,

       RUBEN PENA, Individually and as Co-Executor and
      Co-Trustee of The McGarr Estate and Trust, and as
   Member of The Law Firm of Jones, Galligan, Key & Pena,
        and as Member of The Law Firm of King & Pena,

                           Defendant-Cross Defendant-Appellee,

 FOREST L. JONES, Individually and as Member of The Law Firm
      of Jones, Galligan, Key & Pena; ROBERT L. GALLIGAN,
     Individually and as Member of The Law Firm of Jones,
Galligan, Key & Pena; KING & PENA, A Law Firm; NEAL P. KING,
  Individually and as Member of The Law Firm of King & Pena;
    HARLINGEN NATIONAL BANK, In Its Corporate Capacity and
 as Successor In Interest to Town and Country National Bank;
       TERRY D. KEY; JONES, GALLIGAN, KEY & LOZANO, LLP,

                                          Defendants-Appellees,


                           VERSUS


                     ROBERT E. PEDRAZA,

                           Defendant-Cross Claimant-Appellant.




        Appeal from the United States District Court
             For the Southern District of Texas
                       (B-96-CV-191)
                       July 20, 2000



                             2
Before KING, Chief Judge, GARWOOD and DeMOSS, Circuit Judges.

DeMOSS, Circuit Judge:*

     This appeal presents the Court with the bitter remnants of

several factually complex disputes relating to the distribution of

the estate of Texas farmer Rex McGarr, who died more than fourteen

years ago, on January 14, 1986.         The case is before the Court on

the basis of complete diversity and the matter is controlled by

Texas law. The primary issue is whether the claims asserted herein

are barred by the applicable state statutes of limitation.

     Appellants Paul M, Duthu, Leroy Duthu,2 Rex Duthu, Herman

Duthu, and Ruby Duthu (hereinafter "the Duthus") are beneficiaries

and contingent remainder men under McGarr’s will.          In the district

court, the Duthus filed suit against: (1) attorney Ruben Pena and

a host of lawyers and law firms associated with him (hereinafter

"Pena" or "the Pena interests"), (2) Harlingen National Bank

(hereinafter "the Bank"), as successor in interest to Town &

Country National Bank, which was taken over by the RTC, and (3)

Robert H. Pedraza (hereinafter "Pedraza").        Attorney Pena drafted

the will and served as co-executor of McGarr’s estate.         Pedraza, a

trusted   McGarr   employee   of   long   service,   was   both   a   named

     *
      Pursuant to 5TH CIR. R. 47.5, the Court has determined that
this opinion should not be published and is not precedent except
under the limited circumstances set forth in 5TH CIR. R. 47.5.4.
     2
      We note that this appellant’s name is variously reported in
the record as Lee Roy Duthu and Leroy Duthu. For the purposes of
this opinion, we have adopted the spelling Leroy, as used by the
appellant himself in record evidence.

                                    3
beneficiary and served, together with Pena, as co-executor of the

will.    The Bank’s predecessor in interest, Town & Country National

Bank, extended certain loans secured by the estate’s assets and

then    sued   in   Texas   state   court   to   collect   on   those   loans,

eventually capturing all of the estate’s assets pursuant to a

settlement agreement consummated in 1989.            In December 1999, the

district court entered separate orders granting summary judgment in

favor of Pena and the Bank, finding, inter alia that the Duthus’

claims were barred by both of the potentially applicable Texas

statutes of limitation. The district court then severed the Duthu’s

remaining claims against Pedraza, which are still pending in the

district court, and certified the orders granting summary judgment

to Pena and the Bank for immediate appeal.             The Duthus filed a

timely notice appealing the district court’s December 9 orders.

       In the district court, appellant Robert Pedraza filed a cross-

action against his fellow executor, attorney Pena. With respect to

Pedraza’s claims, the district court granted summary judgment in

favor of Pena, holding that Pedraza’s claims were likewise barred

by the applicable statute of limitations.           Pedraza filed a timely

notice appealing the district court’s order.

       Viewed broadly, there are only two issues presented for review

by this Court: (1) whether the district court properly granted

summary judgment in favor of the defendants with respect to the

Duthus’ claims against Pena and the Bank, and (2) whether the



                                       4
district court properly granted summary judgment with respect to

Pedraza’s claims against Pena.         We review both of these issues de

novo, and affirm.

                                       I.

     The facts, in a light most favorable to the non-movants, are

as follows.    In August 1982, an elderly Rex McGarr executed a last

will and testament.      The will was drafted by attorney Ruben Pena,

who was recommended by McGarr’s long-time friend and farm employee,

Robert Pedraza.        The will provided, in relevant part, for cash

distributions     in    the   amount       of   $5,000   to   certain   named

beneficiaries, including (1)      McGarr’s sister, Ruby Duthu; (2) his

four nephews, Paul, Leroy, Herman, and Rex Duthu; and (3) Robert

Pedraza.     The will further provided for the conveyance of a 114

acre tract owned by McGarr to Pedraza in fee simple.            Finally, the

will provided that the residual estate, that portion remaining

after the distribution of the cash bequests and the conveyance of

the 114 acre tract, be placed into a testamentary trust.                 The

testamentary trust, which was anticipated to include both real and

personal property, was to be administered by Pena and Pedraza as

trustees for the benefit of McGarr’s sister, Ruby Pena, until her

death or for a period of twenty years, with the beneficial interest

to be divided among his nephews and Pedraza at the termination of

the trust.    In May 1982, about three months before Pena prepared

McGarr’s will, Pena prepared a report valuing McGarr’s net worth,



                                       5
and thus his estate, at approximately $1.8 million.

     The same day the will was drafted, attorney Pena prepared a

power of attorney giving Pedraza control over McGarr’s affairs,

which McGarr signed.     The parties have not presented any issues

relating to McGarr’s competence to execute either the will or the

power of attorney.   Months later, in March 1984, Pena drafted and

filed documents in a Cameron County, Texas probate court stating

that McGarr was incompetent and requesting that Pedraza be made

McGarr’s guardian.   Between the time that McGarr fell ill in 1982

and McGarr’s death in 1986, Pedraza, in his role as McGarr’s

guardian, and as assisted and advised by Pena, borrowed more than

one million dollars from several Texas banks, including Town &

Country National Bank.    Pedraza claims that the loans were secured

for the purpose of continuing McGarr’s farming operations.      The

Duthus claim the money was secured for Pedraza’s own personal

business ventures.      Some of the earlier loans were secured by

McGarr’s property, but some were not.     In addition, some of the

loans were obtained without the statutorily required consent of the

probate court administering the guardianship.

     McGarr died in January 1986.       In February 1986, Pena and

Pedraza filed McGarr’s will in a second Cameron County probate

court, one different from the probate court supervising the McGarr

guardianship.   Pena and Pedraza were appointed independent co-

executors of the estate and issued letters testamentary by the

second probate court.    At the time of McGarr’s death, his estate

                                  6
was heavily burdened with the debt accumulated by Pedraza as

McGarr’s guardian, including approximately $500,000 owed to Town &

Country National Bank.    Of the $500,000 debt owed to Town & Country

National Bank, approximately $200,000 was not secured by any of

McGarr’s assets.

     In this action, the Duthus claim they were never aware of any

of these facts.    They claim they did not know the value of McGarr’s

estate, did not know about the guardianship, and did not know any

of the details about the timing or nature of the bank loans.       To

the contrary, the Duthus claim that Pena contacted them after

McGarr’s death, told them that he was their lawyer, and that

McGarr’s estate was burdened by debt that would obliterate their

interest under the will.       Pena further suggested that McGarr

himself had approved the burdensome debt prior to his death, that

their only hope of recovering anything under the will was to sign

releases of their interest under the will, and that they might

become liable for the debt itself if they failed to sign releases.

     On May 15, 1986, Pedraza, assisted by Pena, formed a separate

corporation for real estate development, the El Rancho Potrero

Development Co., Inc.      El Rancho Potrero was privately held by

Pedraza and was not organized for the benefit of McGarr’s estate.

Later in May, Pena negotiated a settlement of the Duthus’ interest

in the estate with Ruby Duthu.    Ruby Duthu and Rex Duthu agreed to

release their interest in exchange for the amount of the cash

bequest and signed releases.           The remaining Duthus, however,

                                   7
refused to sign and the deal fell through.

     In June 1986, Pena, Pedraza, and the Town & Country National

Bank negotiated a new loan that would permit payment of the cash

bequests in full.     Town & Country National Bank agreed to lend the

estate an additional $40,000, to be used for payment of the cash

bequests.    Pedraza and Pena, as co-executors and trustees, agreed

to execute a new note and deed of trust consolidating the $500,000

debt, and most importantly, securing the note with all of the

estate’s    assets.    The   new   note   thus   provided   the   bank   with

additional security in the form of previously unpledged assets and

further converted approximately $200,000 of the debt from unsecured

to secured status.    As an added incentive to sign the consolidated

note, Town & Country National Bank agreed to extend a separate bank

loan to Pedraza’s corporation El Rancho Potrero in the amount of

$219,000.     The proceeds of that loan were to be used to fund

Pedraza’s purchase of 62 acres from the estate.        In late June 1986,

Pena and Pedraza signed the note consolidating the various loans

and securing the debt with the assets of the estate.              The total

amount of the consolidated and secured loan, however, was $625,000,

rather than $540,000.     The Duthus claim that the additional monies

covered loans extended to Pedraza personally. The Duthus challenge

the validity of the consolidated note on various grounds.

     Throughout the balance of 1986, Pena tried to negotiate

settlements of the Duthus’ outstanding interest in the pledged



                                     8
estate property.     Ruby Duthu and Rex Duthu remained willing to

settle for the negotiated amounts, but the remaining Duthus raised

objections.    Eventually, in January 1987, all of the Duthus signed

releases.    Ruby Duthu, Rex Duthu, and Herman Duthu signed releases

in exchange for $5,000. Leroy Duthu and Paul Duthu signed releases

in exchange for $7,000.    In this action, Ruby Duthu, Herman Duthu

and Rex Duthu claim that, notwithstanding the fact that they were

paid in full under the express terms of the releases, Pena promised

to try and get them an additional $2,000 so that they would

ultimately receive the same amount as Leroy Duthu and Paul Duthu.

The record contains documentation supporting this claim in the form

of subsequent letters from Pena distributing an additional $500 to

these parties, with the comment that Pena hopes to be able to

obtain a remaining balance of $1,500 in the near future.        The

Duthus thus dispute the validity of the releases for a variety of

reasons, including failure of promised consideration and fraudulent

inducement based upon misrepresentations by Pena.

     Nothing else happened until March 1988, when Pedraza defaulted

on bank notes secured by the estate’s assets.       Town & Country

National Bank tried to satisfy the note by selling the estate’s

assets.     While in that process, Town & Country National Bank was

taken over by the RTC.     In August 1988, the notes were purchased

from the RTC by Harlingen National Bank (referred to herein as "the

Bank").

     In 1988, the Bank sued Pena, Pedraza, Pedraza’s wife Olivia,

                                  9
El Rancho Potrero, McGarr’s estate, and its title insurer for

payment      on    the     loans    in   a    Texas      state   court    of    general

jurisdiction.           In December 1988, and while the state foreclosure

suit   was    pending,       Ruby   Duthu,        Rex   Duthu,   and   Herman   Duthu,

contacted Mississippi attorney Don Barrett about their substantial

rights under McGarr’s will.              The Duthus claim that they contacted

Barrett purely and solely for the purpose of obtaining the $1,500

balance owed to them pursuant to Pena’s promise to obtain $2,000

for each of them in addition to the amount recited as consideration

under the terms of the releases executed by them.                              However,

Barrett’s initial investigatory letter to Pena includes the Duthus’

allegation that they were “induced” to sign a waiver of their

rights under the will. Moreover, the record reflects that attorney

Barrett made a broader investigation, eventually corresponding with

the Texas state probate court and obtaining copies of the public

filings in the court’s file.

       In January 1989, Pena responded to Barrett’s inquiry on behalf

of Ruby Duthu, Rex Duthu, and Herman Duthu.                  Pena informed Barrett

that McGarr’s estate was heavily burdened by debt that exceeded the

value of the estate. Pena forwarded Barrett copies of the releases

in which the Duthus released their claims for $5,000 and explained

that   when       the    releases    were    signed,      Pena   was     hopeful   that

successful negotiations would eventually permit Pedraza to take

over the farm, which could have potentially preserved some value to

the estate. Pena informed Barrett that that was no longer possible

                                             10
because the debt owed to the Bank had been placed in litigation

that would essentially bankrupt the estate, leaving no further

assets to be distributed.    Thus, by January 1989, at least three of

the Duthus had actual or constructive notice through their counsel

that the state court foreclosure action threatened to consume all

of the estate’s assets.

      In July 1989, the Bank and the estate settled the state court

foreclosure suit by assigning all of the estate’s assets to the

Bank, and the state court entered final judgment dismissing the

action.    In August 1989, the estate’s assets were conveyed to the

Bank pursuant to the settlement agreement.             The Duthus challenge

the validity of both the Bank’s claims and the settlement agreement

in the state court foreclosure suit on a variety of grounds.

      The Duthus claim that they were not aware of either the

$625,000 consolidation loan or the Bank’s foreclosure suit and

final judgment until 1996 when a third-party, Texas attorney

Heriberto Medrano, conducted an independent investigation and then

traveled to Mississippi to inform the Duthus of the relevant

facts.3

      Pedraza likewise claims that he has been the victim of the

more sophisticated machinations of a purportedly self-dealing Pena

in   the   administration   of    the    guardianship     and   the   estate.

Notwithstanding   his   central    role    in   most    of   the   misconduct

      3
      Attorney Medrano accepted the case himself and continues to
represent the Duthus in this appeal.

                                    11
identified by the Duthus, Pedraza claims that his only desire was

to have the will enforced as written.   Pedraza claims that he wrote

Pena demand letters insisting that Pena establish the trust, pay

the bequests, and convey the 114 acre tract to him, but that Pena

took no action.   Pedraza does not, however, explain how Pena would

have been able to accomplish any of those things in light of the

heavy debt accrued by Pedraza himself as guardian of McGarr’s

estate.   Pedraza claims that he consolidated the loans and secured

them with the estate’s assets because Pena and a bank officer

convinced him it was necessary to avoid unpleasant ramifications in

a bank audit.     Pedraza further claims that he objected to the

formation of El Rancho Potrero, and that he did not understand why

the estate’s property was being conveyed to El Rancho Potrero.

Pedraza also accuses Pena of a variety of other misconduct.

                                II.

     The instant suit began in October 1996, when the Duthus filed

suit against Pena, Pedraza, and the Bank in federal district court.

The Duthus’ Complaint alleges: (1) that Pena and Pedraza breached

certain fiduciary duties owed to the Duthus, committed fraud, and

engaged in a civil conspiracy which damaged the Duthus; (2) that

the Bank’s conduct during the administration of the guardianship

and estate amounted to civil conspiracy; and (3) that Pena and

various law firms and attorneys associated with Pena committed

legal malpractice.



                                 12
     In January 1997, Pena moved for dismissal or summary judgment.

Pena argued that the Duthus’ claims were barred by the applicable

Texas statute of limitations.   Alternatively, Pena argued that the

claims should be dismissed because the Duthus formally released

their interest in the estate in 1987, or because there was no

privity between the Duthus and the defendant law firms.

     In February 1997, the Bank moved for dismissal or summary

judgment.   The Bank argued that the Duthus’ claims were barred by

the applicable statute of limitations.     Alternatively, the Bank

argued that the Duthus’ claims were barred by the D’Oench Duhme

doctrine, or by the doctrines of compromise and settlement, accord

and satisfaction, release, and res judicata.

     In January 1998, Pedraza filed cross-claims against Pena,

alleging legal malpractice and breach of fiduciary duty.   In March

1998, the Bank filed conditional cross-claims against Pena seeking

contribution and indemnity in the event that the Bank was held

liable. Also in March 1998, Pena moved to dismiss Pedraza’s cross-

claim against Pena.    As in his motion to dismiss the Duthus’

claims, Pena argued that Pedraza’s claims were time barred by the

applicable statute of limitations.

     On December 9, 1998, the district court entered separate

orders granting Pena’s motion for summary judgment with respect to

the Duthus’ claims, and granting the Bank’s motion for summary

judgment with respect to the Duthus’ claims.    The district court

held that the undisputed facts established that the Duthus’ claims

                                 13
accrued, at the latest, in July 1989 when the state court entered

final judgment in the Bank’s foreclosure suit pursuant to the

settlement agreement providing for the transfer of all of the

estate’s assets to the Bank.      Given that the claims were not filed

until more than seven years later, on October 28, 1996, the claims

were time barred by both of the potentially applicable Texas

limitation periods, which would be two years for those claims

sounding in tort, see TEX. CIV. PRAC. & REM. CODE § 16.003, and four

years for those claims sounding in contract, see TEX. CIV.         PRAC. &

REM. CODE § 16.004.    The Duthus appeal the district court’s grant of

summary judgment with respect to their claims against Pena and the

Bank.

     On January 22, 1999, the district court entered an order

granting Pena’s motion for summary judgment as to Pedraza’s cross-

claims,   holding     that   Pedraza’s   claims   were   also   barred   by

limitations.   In this order, the district court noted that Pedraza

was aware of both the operative facts and any available legal

theories against Pena no later that February 10, 1992, when an

attorney retained by Pedraza wrote Pedraza a letter stating that

the statue of limitations for a claim against Pena would expire the

following month.      Given that the cross-claims were not filed until

almost 6 years later, on January 29, 1998, the claims were time

barred by both of the potentially applicable Texas limitation

statutes.   Pedraza appeals the district court’s January 22, 1999


                                    14
order.

     In addition to the proceedings in the district court, there

have been significant developments in two related state court suits

during the pendency of this appeal.4           In Pedraza v. Pena, No. 13-

97-450-CV    (Tex.    App.   -    Corpus      Christi,     Sept.   16,   1999)

(unpublished), Rogerio Pedraza, who is both Robert Pedraza’s father

and a beneficiary under the will, filed suit against Pena for,

inter alia, failure to make the distribution required under the

will.    In that case, which was filed in Hidalgo County, Texas, the

state trial court granted Pena summary judgment, holding that

Rogerio Pedraza’s claims were barred by limitations.                 The state

court of appeals reversed, holding that Pena failed, in that case,

to prove when Rogerio Pedraza’s cause of action accrued as a matter

of law.    The court of appeal’s judgment in that case was informed

only by a copy of McGarr’s will and the date that the case was

admitted to probate.

     Three   months   later,     the   same   court   of   appeals   issued a

decision in an adversarial action arising from the Cameron County,

Texas probate court handling the McGarr estate.             See In re McGarr,


     4
      There is also at least one other related third state court
action pending. While this suit was pending, Pena filed Pena v.
Jimenez, No. 98-02-663-A in the 107th District Court of Cameron
County, Texas against certain parties, including Pedraza and the
Duthus. In March 1998, the Duthus removed the action to federal
court and requested consolidation with the instant action. Pena
objected to removal and moved to remand for lack of subject matter
jurisdiction. The district court granted the motion, and Pena v.
Jimenez forms no part of the current case.

                                       15
10 S.W.3d 373 (Tex. App. - Corpus Christi 1999, no writ).                       In re

McGarr    was     filed     by     Robert       Pedraza    and    other     non-Duthu

beneficiaries under the will for an accounting and inventory of the

estate.     The     Duthus       later     intervened,     adding    a     claim    for

distribution under the will.             See id. at 374 n.1.        The trial court

received extensive evidence before denying all requests, including

evidence relating to the Duthus’ and Pedraza’s reliance upon

counsel, the Duthus’ releases, and the bank foreclosure action.

See id. at 375-76.          The court of appeals affirmed the probate

court’s denial of relief.

     The rationale and authorities relied upon in this second, and

more pertinent, state court appellate decision are ultimately

controlling in our disposition of this appeal.                       The court of

appeals   began    by     noting    that    the    issue   of    which    statute    of

limitations applies to demands for an accounting, inventory and

distribution, is unclear under Texas law.                  See id. at 376 (citing

Little v. Smith, 943 S.W.2d 414, 416 (Tex. 1997)).                       The court of

appeals then held that the plaintiffs’ cause of action accrued and

limitations began to run when the estate closed, which occurred in

July 1989, when the state court handling the foreclosure suit

entered final judgment giving the estate’s assets to the Bank.

See id. at 376.     Thus, the plaintiffs’ claims, filed more than four

years later, were barred without regard to which statute applied.

The court of appeals expressly distinguished its decision three


                                           16
months earlier in Pedraza v. Pena on the basis that the record in

that case was inadequate to decisively establish when the McGarr

estate closed.       See id. at 376 n.4.

      The court of appeals then considered whether the plaintiffs

suit could nonetheless be permitted to proceed by application of

the Texas discovery rule.         Where applicable, the discovery rule

provides that a statutory limitation period may be tolled until the

claimant either discovers, or through the exercise of reasonable

diligence   should     have    discovered,    the   facts    establishing   the

elements of the cause of action.            See, e.g., Little v. Smith, 943

S.W.2d 414, 418 (Tex. 1997); Andress v. Condos, 672 S.W.2d 627, 630

(Tex. App. - Fort Worth 1984, writ ref’d n.r.e.); Eastman v.

Biggers, 434 S.W.2d 439 (Tex. App. - Dallas 1968, no writ).                In In

re   McGarr,   the     Texas   court   of    appeals   concluded    that    the

limitations period was not tolled because the plaintiffs’ could be

charged with constructive notice of the actual knowledge that could

be obtained by an examination of public records, including the

record of the guardianship, probate, and foreclosure proceedings.

See id. at 377-78.      The court of appeals further concluded that the

fiduciary relationship between the Duthus and Pena, in his role as

an attorney or executor, was insufficient to excuse their failure

to exercise due diligence to discover the basis for their cause of

action from available public records.           See id.     Thus, the court of

appeals held that the facts of this case supported a holding that

                                       17
the Duthus and Pedraza could have, but did not discover the facts

made     the    basis     of   their     multiple     claims     in     July    1989,

notwithstanding the fact that certain facts may have been concealed

from them by someone purporting to act as a fiduciary on their

behalf. The plaintiffs later filed a petition from this holding of

the state court of appeals, which was denied.                          Keeping this

important holding of the state court of appeals in mind, we proceed

to a consideration of the parties’ specific arguments in this

appeal.

                                         III.

       The Duthus argue that summary judgment in favor of Pena was

inappropriate because they could not have known the facts giving

rise to their claims until shortly before they filed suit in 1996,

when attorney Medrano visited them in Mississippi.                       Texas law

provides       that   a   cause   of   action   for    an    accounting        or   for

distribution of an estate accrues and the limitation period begins

to run when the independent executor files a final verified account

of the estate or when all of the debts of the estate have been paid

and any remaining estate property has been distributed.                    See TEX.

PROBATE CODE § 151; see also In re McGarr, 10 S.W.3d at 376.                   In the

context of this case, the second circumstance occurred, and most of

the Duthus’ claims would have normally accrued in July 1989, when

the state court entered judgment in the foreclosure suit, or at the

latest    in    August    1989,   when    the   assets      of   the   estate       were


                                          18
transferred to the Bank. In addition, all of the operative conduct

giving rise to the Duthus’ remaining claims occurred before or

shortly after August 1989.   Thus, there appears to be no dispute

that the Duthus’ remaining claims would likewise have accrued at

that time.

     The Duthus did not file suit until October 1996, more than

seven years later. Thus, assuming arguendo that the Duthus’ claims

are governed by the more generous four year state statute of

limitations,5 their claims are time barred if they accrued before

October 1992.   The Duthus attempt to deal with the gap between the

last relevant conduct in 1989 and the last possible trigger date in

October 1992 by invoking the Texas version of the discovery rule.

     Texas courts have applied the discovery rule in “two types of

cases: fraud or fraudulent concealment, and where the nature of the



     5
      Precisely which statute of limitations applies to which of
the appellants’ multiple claims is actually a fairly complex issue.
Certainly, some of the Duthus’ and Pedraza’s claims would be
controlled by the shorter two year period of limitations, see Kansa
Reinsurance Co., Ltd., 20 F.3d 1362, 1374 (5th Cir. 1994) (applying
Texas’ two year statute of limitation to breach of fiduciary duty
claims); Willis v. Maverick, 760 S.W.2d 642, 643 (Tex. 1988) (“A
cause of action for legal malpractice is in the nature of a tort
and is thus governed by the two-year limitations statutes.”);
Chandler v. Chandler, 991 S.W.2d 367, 394 (Tex. App.–El Paso,
Texas, writ denied), cert. denied, 120 S. Ct. 2033 (2000) (“The
statute of limitations for civil conspiracy is two years.”), while
others may be controlled by the four year period of limitations,
see Kansa Reinsurance Co., 20 F.3d at 1369 (noting that Texas law
provides a four year limitation period for fraud claims). We need
not definitively resolve the issue in order to dispose of this
case, because we conclude that the appellants’ claims are barred
without regard to which of the two limitations periods apply.

                                 19
injury   incurred    is   inherently   undiscoverable,   but   may   be

objectively verified.”     Mellon Serv. Co. v. Touche Ross & Co., 17

S.W.3d 432, 436 (Tex. App. - Houston [1st Dist.] 2000, no writ).

The Duthus maintain that Pena’s and the Bank’s wrongful concealment

of the relevant facts prevented them from obtaining notice of their

claims any earlier than 1996.          This is the equivalent of a

fraudulent concealment claim.    Therefore, the discovery rule is at

least potentially applicable to toll the relevant limitation period

in this case.    See, e.g., Andress, 672 S.W.2d at 629-30; Eastman,

434 S.W.2d at 441.

     What remains for determination is whether Pena has established

that the Duthus either discovered or should have, through the

exercise of reasonable diligence, discovered the facts made the

basis of their claims.    We hold that Pena has met that burden as a

matter of law.   All of the operative facts forming the basis of the

Duthus’ claims occurred before the end of 1989.           The summary

judgment record conclusively establishes that there were, at that

time, publicly available records placing the Duthus on constructive

notice of the factual basis for their claims.    See In re McGarr, 10

S.W.3d at 377; see also Little, 943 S.W.2d at 421 (“Constructive

notice is usually applied when a person knows where to find the

relevant information but failed to seek it out.”); Mooney v.

Harlin, 622 S.W.2d 83, 85 (Tex. 1981) (“When evidence of fraud may

be disclosed by examination of public records this court has held


                                  20
that limitations will begin to run from the time the fraud could

have been discovered by the exercise of ordinary diligence.”; id.

(“Persons interested in an estate admitted to probate are charged

with notice of the contents of the probate records.”); Andress, 672

S.W.2d at 630-31 (affirming summary judgment in favor of defendants

on limitation grounds and holding that plaintiffs’ failure to

search publicly available records supported determination that

plaintiffs’ failed to exercise due diligence in the discovery of

their claim as a matter of law); Eastman, 434 S.W.2d at 443 (same).

Indeed, the Duthus do not identify one fact or circumstance which

came into existence or occurred between 1989 and 1996 that made

their previously undiscoverable claim or injury discoverable in

1996.   To the contrary, the only thing that happened in that time

period is that attorney Medrano, a stranger to the suit and all

dealings, decided for some undisclosed reason to look into the

matter.   The clear implication is that the Duthus could have, with

an exercise of due diligence, done so themselves much earlier.

See, e.g., Andress, 672 S.W.2d 627; Eastman, 434 S.W.2d 439.

     The Duthus assert that they are relatively unsophisticated

people who cannot fairly be charged with constructive notice of the

content of the state court files in the guardianship, probate, and

foreclosure   proceeding,   because   they   justifiably   relied   upon

various misrepresentations made by Pena as their attorney and

fiduciary with respect to their interests under the estate.


                                 21
     We disagree with both the factual premise and the legal

conclusion underlying the Duthus’ argument.    At least three of the

Duthus (Ruby, Rex, and Herman) obtained notice from Pena through

their counsel Barrett that the assets of the estate had been placed

in litigation with a lien holder, and that the litigation was

expected to bankrupt the estate.     Had the Duthus investigated the

status of that pending litigation, they would have discovered

virtually all of the facts that they claim were concealed from them

by Pena, including the existence of the guardianship proceeding and

the rapid accumulation of debt by Pedraza on McGarr’s behalf, from

the terms of the note at issue in the foreclosure proceeding.

     In addition, the record conclusively establishes that four of

the five Duthus (Ruby, Rex, Herman, and Paul) obtained legal

counsel with respect to the effect of the signed releases.    Record

evidence in the form of correspondence from Ruby Duthu states that

Leroy also sought and received legal counsel while the estate was

being administered. Pena may have been proceeding in the technical

role of fiduciary, but the essentially adversarial and conflict-

ridden nature of the relationship between the Duthus and Pena is

obvious in the record.     This is, therefore, not the type of

fiduciary relationship were the Duthus were blindly following the

lead of a trusted fiduciary, nor where they were consenting without

question to the fiduciary’s handling of their own affairs.   Even if

the Duthus are themselves rather unsophisticated, we have no



                                22
trouble under the specific circumstances of this case, concluding

that the relevant facts and circumstances placed the Duthus on

sufficient notice that they both could have, and should have

followed up upon Pena’s 1989 disclosure of the pending foreclosure

suit by reviewing publicly available records in lawsuits involving

the estate.     Had they done so, they would have discovered the facts

made the basis of their claims against Pena from the face of those

records.

     We likewise reject the Duthus’ suggestion that Pena’s alleged

concealment of the guardianship or the nature and origin of the

debt burdening the estate trumps the requirement that they exercise

due diligence to discover their claims.          Texas law is clear; while

fraudulent concealment by a fiduciary may be a factor in the

determination of whether a plaintiff exercised due diligence, such

a factor neither supplants nor excuses the requirement for the

exercise of due diligence on the part of the prospective plaintiff.

See, e.g., Colonial Penn Ins. Co. v. Market Planners Ins. Agency,

1 F.3d 374, 377 (5th Cir. 1993) (“Texas cases make clear that

fraudulent concealment does not trump the discovery rule, but is

merely a factor to consider in determining when a plaintiff in a

fiduciary relationship knew or should have known of the facts

giving   rise    to   its   cause   of    action.”);   Courseview,   Inc.   v.

Phillips Petroleum Co., 312 S.W.2d 197, 205 (Tex. 1957) (“a failure

to exercise reasonable diligence is not excused by mere confidence


                                         23
in the honesty and integrity of the other party”); Andress, 672

S.W.2d at 630 (“The fact that parties are fiduciaries does not,

however, change the rule that diligence is required in discovering

the fraud. Rather, the fiduciary relationship is merely one of the

circumstances to be considered in determining whether fraud might

have been discovered by the exercise of reasonable diligence.”);

Eastman, 434 S.W.2d at 442 (“the fact that a fiduciary relation

exists does not justify a party in negligenting every precaution

until something occurs to arose his suspicions.”).

     Pena has established that the Duthus’ claim accrued more than

four years before they filed suit in 1996.    For that reason, the

Duthus’ claims against Pena were untimely filed and we therefore

affirm the district court’s grant of summary judgment in favor of

Pena as to those claims.

                                IV.

     The same reasoning applies in large part to the Duthus’ claims

against the Bank.    We need pause only briefly to consider the

Duthus’ primary arguments.   The Duthus argue that summary judgment

was inappropriate with respect to their claims against the Bank for

two reasons.   The Duthus first claim that they were denied the

opportunity to engage in the discovery required to fully respond to

the Bank’s motion.   The Duthus preserved error on this point by

moving for a continuance for such discovery pursuant to Federal

Rule of Civil Procedure 56(f), which was denied.   The Duthus argue


                                24
that, given the opportunity, they would have explored what the Bank

knew and what documents were in its files when the Bank filed the

foreclosure suit against the estate. We note that virtually all of

the items identified for further discovery related to the merits of

the Duthus’ claim, i.e. the Bank’s conduct during the course of

McGarr’s      guardianship,        Pena    and     Pedraza’s       administration        of

McGarr’s will, and the Bank’s foreclosure suit.                              There is no

indication in the record that any of the discovery would have been

responsive      to   or    provided      any    means    for     avoiding     the   Bank’s

limitation defense, which was the basis for the district court’s

decision. We conclude, therefore, that the district court’s denial

of the Duthus’ rule 56(f) motion was not an abuse of discretion.

     The   Duthus         next   claim    that    there    are     genuine     issues    of

material fact for the jury with respect to the Bank’s limitation

defense. The Duthus’ arguments, however, are tied primarily to the

merits of their civil conspiracy claims against the Bank rather

than the Bank’s limitations defense.                   The Bank, on the other hand,

correctly responds that there was no fraudulent concealment on its

part, that it dealt openly, in conformity with Texas law, and as a

matter of public record with the estate, and that the Duthus’

claims were inherently discoverable from the pertinent public

records    no    later      than   late    1989.         There    is,   therefore,       no

justification        for    applying      the    discovery       rule   to    extend    the

limitations period with respect to the Duthus’ claims against the

Bank,   and     we   therefore     affirm        the    district    court’s     decision

                                            25
granting summary judgment in favor of the Bank as to those claims.

                                      V.

     What remains for review is the district court’s decision

granting   summary   judgment   in    favor    of   Pena   with   respect   to

appellant Pedraza’s claims for breach of fiduciary duty, self-

dealing, fraudulent misrepresentation, and conversion.               Pedraza

maintains that the district court’s decision is flawed by two

errors.    First, Pedraza argues that the district court’s order

granting summary judgment is premised upon a significant factual

error.    Pedraza notes the district court’s observation that:

            There is no question but that PEDRAZA through his
            attorney was aware of sufficient facts to commence
            the running of the statute of limitations by early
            1991 and was advised by letter of February 10, 1992
            that the “statute of limitations against Pena [and
            Sanchez] expires on March 19, 1992, two years after
            you fired them.”

The letter quoted by the district court was written by Texas

attorney Elihu Dodier, who agreed to try and find counsel for

Pedraza’s potential claims against Pena, another attorney named

Sanchez, and the Bank.     Pedraza claims that he only asked Dodier to

investigate suit against the Bank and that he did not have any

facts supporting suit against Pena until attorney Medrano conducted

his investigation in 1996.      Pedraza’s argument in this regard is

without any merit.    Both Dodier’s February 10, 1992 letter, and a

previous   communication    from     another   prominent    attorney,   John

O’Quinn, demonstrate that Pena’s conduct was likewise at issue.



                                      26
     Pedraza next invokes his ignorance of the law, and his lack of

sophistication.     While sympathetic, Pedraza does not cite any

authority   that   would   permit   this   Court   to   avoid   the   quoted

correspondence, or the obvious fact that counsel secured by Pedraza

made him clearly aware of facts that should have given rise, at the

very least, to more investigation.

     We are also influenced by the fact that Pedraza played an

active role in every aspect of the conduct he now identifies as

objectionable.     Pedraza was the guardian appointed by one of the

probate courts. Pedraza signed the notes that burdened the estate.

Pedraza signed documents forming El Rancho Potrero. Pedraza signed

the consolidated note pledging the estate’s assets and converting

a partially unsecured loan to a completely secured loan backed by

estate assets worth more than the actual debt.           Further, Pedraza

was party to the “self-dealing” sale of real estate from McGarr’s

estate to Pedraza’s own corporation.         Pedraza was party to the

foreclosure action by the bank. After the Bank foreclosed, Pedraza

retained a lawyer to shop around a lender liability claim against

the Bank.   In March 1990, Pedraza fired Pena and apparently began

trying to secure counsel for claims against Pena as well.         In early

1991, Pedraza received attorney O’Quinn’s analysis of his case,

which listed Pena as a target defendant. In February 1992, Pedraza

received actual notice from attorney Dodier that the statute of

limitations against Pena was about to expire. Nonetheless, Pedraza

did not file suit until January 1998, almost six years after that

                                    27
date.

     Assuming that some or all of Pedraza’s claims are controlled

by the more liberal four year statute of limitations, his cause of

action would be barred unless it accrued some time after January

1994.      We agree with the district court that the record is

sufficient to establish as a matter of law that Pedraza was

actually aware of the facts made the basis of his claim well in

advance of that date.      We therefore affirm the district court’s

order granting Pena’s motion for summary judgment with respect to

Pedraza’s claims against him.

                                 CONCLUSION

     The    summary   judgment    record   in   this   case   conclusively

establishes as a matter of law that the appellants’ claims accrued

and limitations began to run more than four years before they filed

suit.   For that reason, the district court is AFFIRMED.




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