Nebraska Supreme Court Online Library
www.nebraska.gov/apps-courts-epub/
11/09/2018 08:12 AM CST




                                                          - 94 -
                                  Nebraska Supreme Court A dvance Sheets
                                          301 Nebraska R eports
                               CHAFIN v. WISCONSIN PROVINCE SOCIETY OF JESUS
                                              Cite as 301 Neb. 94




                        K athleen Chafin, appellant, v. Wisconsin Province
                             of the Society of Jesus and the Catholic
                                 A rchdiocese of Omaha, appellees.
                                                     ___ N.W.2d ___

                                        Filed September 21, 2018.   No. S-17-1059.

                1.	 Appeal and Error. To be considered by an appellate court, an alleged
                    error must be both specifically assigned and specifically argued in the
                    brief of the party asserting the error.
                2.	 Motions to Dismiss: Pleadings: Appeal and Error. An appellate court
                    reviews a district court’s order granting a motion to dismiss de novo,
                    accepting the allegations in the complaint as true and drawing all rea-
                    sonable inferences in favor of the nonmoving party.
                3.	 Limitations of Actions: Fraud. An action for fraud does not accrue
                    until there has been a discovery of the facts constituting the fraud, or
                    facts sufficient to put a person of ordinary intelligence and prudence on
                    an inquiry, which, if pursued, would lead to such discovery.
                4.	 Limitations of Actions: Pretrial Procedure. Discovery, as applied to
                    the statute of limitations, occurs when one knows of the existence of an
                    injury or damage and not when he or she has a legal right to seek redress
                    in court.
                5.	 Limitations of Actions: Pleadings: Proof. If the complaint on its face
                    shows that the cause of action is time barred, the plaintiff must allege
                    facts to avoid the bar of the statute of limitations and, at trial, has the
                    burden to prove those facts.
                6.	 Fraud: Estoppel: Limitations of Actions: Proof. In order to success-
                    fully assert the doctrine of fraudulent concealment and thus estop the
                    defendant from claiming a statute of limitations defense, the plaintiff
                    must show the defendant has, either by deception or by a violation of a
                    duty, concealed from the plaintiff material facts which prevent the plain-
                    tiff from discovering the misconduct.
                7.	 Fraud: Pleadings: Time. Allegations of fraudulent concealment for
                    tolling purposes must be pleaded with particularity.
                                  - 95 -
            Nebraska Supreme Court A dvance Sheets
                    301 Nebraska R eports
          CHAFIN v. WISCONSIN PROVINCE SOCIETY OF JESUS
                         Cite as 301 Neb. 94

 8.	 Motions to Dismiss: Fraud: Pleadings: Proof. In order to survive a
     motion to dismiss, a complaint alleging fraudulent concealment must
     plead with particularity how material facts were concealed to prevent
     the plaintiff from discovering the misconduct and how, through due
     diligence, the plaintiff failed to discover his or her injury.
 9.	 Pleadings: Words and Phrases. Pleading facts with particularity means
     the who, what, when, where, and how: the first paragraph of any news-
     paper story.

  Appeal from the District Court for Douglas County: Shelly
R. Stratman, Judge. Affirmed.

  Thomas C. Dorwart and Benjamin E. Maxell, of Govier,
Katskee, Suing & Maxell, P.C., L.L.O., for appellant.

   James J. Frost, of McGrath, North, Mullin & Kratz, P.C.,
L.L.O., for appellee Wisconsin Province of the Society of
Jesus.

   Patrick M. Flood and Lisa M. Meyer, of Pansing, Hogan,
Ernst & Bachman, L.L.P., for appellee Catholic Archdiocese
of Omaha.

  Heavican, C.J., Miller-Lerman, Cassel, Stacy, Funke,
Papik, and Freudenberg, JJ.

   Cassel, J.
                       INTRODUCTION
   Kathleen Chafin sued two religious organizations, alleging
that when she gave birth, these organizations kidnapped her
newborn son and fraudulently concealed his adoption. Based
upon the statute of limitations, the district court dismissed her
amended complaint. Chafin contends that her allegation of
fraudulent concealment tolled the statute. Because a pleading
rule requires the facts of fraudulent concealment to be stated
with particularity and because Chafin pled mere legal conclu-
sions, dismissal was correct. Therefore, we affirm.
                                      - 96 -
                Nebraska Supreme Court A dvance Sheets
                        301 Nebraska R eports
              CHAFIN v. WISCONSIN PROVINCE SOCIETY OF JESUS
                             Cite as 301 Neb. 94

                        BACKGROUND
                         1969 A doption
   Because of the procedural posture, we state facts as alleged
in the amended complaint. And at this stage, we are required
to assume that these allegations are true. Chafin gave birth to
a son in 1969, who was then put up for adoption through the
Wisconsin Province of the Society of Jesus and the Catholic
Archdiocese of Omaha (collectively the Church). Chafin alleges
that her son was fraudulently adopted without her consent and
that the Church concealed this fraud over 40 years, until Chafin
reunited with her son in 2015.
   In 1968, Chafin discovered she was pregnant and left col-
lege to return home to Omaha, Nebraska. After the discovery
of the pregnancy, Father Thomas A. Halley “forced” Chafin to
sign a contract for room and board in a residence for young
unmarried pregnant women. The complaint alleges that “the
end-game in this process was to provide babies for compliant
couples in good standing with the [Church] under for-profit
fraudulent adoptions.”
   While at the residence, Chafin arranged for her grandmother
“to rescue her from this nightmare” of the residence. Before
Chafin’s grandmother arrived, Chafin went into labor and the
baby was immediately “taken” from her.
   We set forth the allegations of fraudulent concealment in the
analysis section below.
                        Motion to Dismiss
   The Church moved to dismiss the amended complaint for
failure to state a claim. The district court determined that the
allegations failed to toll the statute of limitations for various
reasons. It reasoned that the amended complaint failed to plead
sufficient facts to overcome the statute of limitations. The court
granted the motion and dismissed the claims with prejudice.
   Chafin filed a timely appeal, which we moved to our docket.1

 1	
      See Neb. Rev. Stat. § 24-1106(3) (Supp. 2017).
                                      - 97 -
                Nebraska Supreme Court A dvance Sheets
                        301 Nebraska R eports
              CHAFIN v. WISCONSIN PROVINCE SOCIETY OF JESUS
                             Cite as 301 Neb. 94

                ASSIGNMENTS OF ERROR
   Chafin assigns generally that the district court erred (1)
in dismissing her amended complaint and (2) in evaluating
its merits.
   [1] But Chafin’s argument is quite limited. To be considered
by an appellate court, an alleged error must be both specifi-
cally assigned and specifically argued in the brief of the party
asserting the error.2 Chafin argues only that the fraudulent
concealment of the adoption persisted until she discovered her
son in 2015, therefore tolling the statute of limitations. Thus,
we confine her assignment of error to her specific argument
regarding fraudulent concealment.
                  STANDARD OF REVIEW
   [2] An appellate court reviews a district court’s order grant-
ing a motion to dismiss de novo, accepting the allegations in
the complaint as true and drawing all reasonable inferences in
favor of the nonmoving party.3
                           ANALYSIS
                      Statute of Limitations
    The Church asserts that Chafin’s claims are barred by a
4-year statute of limitations. Neb. Rev. Stat. § 25-207(3)
(Reissue 2016) sets forth a 4-year statute of limitations for
“an action for an injury to the rights of the plaintiff, not aris-
ing on contract, and not hereinafter enumerated.” Although a
claim under § 25-207 can be asserted at the time the cause of
action accrued, “an action for relief on the ground of fraud
. . . shall not be deemed to have accrued until the discovery of
the fraud.”4
    [3,4] An action for fraud does not accrue until there has
been a discovery of the facts constituting the fraud, or facts

 2	
      In re Interest of Nicole M., 287 Neb. 685, 844 N.W.2d 65 (2014); Carlson
      v. Allianz Versicherungs-AG, 287 Neb. 628, 844 N.W.2d 264 (2014).
 3	
      Burklund v. Fuehrer, 299 Neb. 949, 911 N.W.2d 843 (2018).
 4	
      § 25-207(4).
                                       - 98 -
                Nebraska Supreme Court A dvance Sheets
                        301 Nebraska R eports
              CHAFIN v. WISCONSIN PROVINCE SOCIETY OF JESUS
                             Cite as 301 Neb. 94

sufficient to put a person of ordinary intelligence and pru-
dence on an inquiry, which, if pursued, would lead to such
discovery.5 Discovery, as applied to the statute of limitations,
occurs when one knows of the existence of an injury or dam-
age and not when he or she has a legal right to seek redress
in court.6
   Unless Chafin sufficiently pled fraudulent concealment,
the statute of limitations began to run in 1969 when Chafin
discovered the existence of her injury. At that point, Chafin
knew that the Church facilitated the adoption, knew that the
child never returned to her, and knew she was injured by the
adoption because she was not allowed to keep her son. At
the time of her child’s birth, Chafin was aware of her injury
and sufficient facts to put a person of ordinary intelligence
and prudence on inquiry. From these facts, Chafin knew
who allegedly committed the fraud, what was done, where
it was done, how it was done, and when her injury from the
fraud occurred.
                     Tolling by Fraudulent
                          Concealment
   [5,6] Chafin asserts that fraudulent concealment tolls the
statute of limitations. If the complaint on its face shows that
the cause of action is time barred, the plaintiff must allege
facts to avoid the bar of the statute of limitations and, at trial,
has the burden to prove those facts.7 In order to successfully
assert the doctrine of fraudulent concealment and thus estop
the defend­ant from claiming a statute of limitations defense,
the plaintiff must show the defendant has, either by deception

 5	
      Fitzgerald v. Community Redevelopment Corp., 283 Neb. 428, 811 N.W.2d
      178 (2012).
 6	
      Andres v. McNeil Co., 270 Neb. 733, 707 N.W.2d 777 (2005). See, also,
      Alston v. Hormel Foods Corp., 273 Neb. 422, 730 N.W.2d 376 (2007);
      Kalkowski v. Nebraska Nat. Trails Museum Found., 20 Neb. App. 541, 826
      N.W.2d 589 (2013) (applying general discovery rule to discovery of fraud).
 7	
      See Lindner v. Kindig, 285 Neb. 386, 826 N.W.2d 868 (2013).
                                       - 99 -
                Nebraska Supreme Court A dvance Sheets
                        301 Nebraska R eports
              CHAFIN v. WISCONSIN PROVINCE SOCIETY OF JESUS
                             Cite as 301 Neb. 94

or by a violation of a duty, concealed from the plaintiff mate-
rial facts which prevent the plaintiff from discovering the mis-
conduct.8 Under the doctrine of fraudulent concealment, the
plaintiff must show that he or she exercised due diligence to
discover his or her cause of action before the statute of limita-
tions expired.9
               Pleading Fraudulent Concealment
                       With Particularity
   In order to determine whether an allegation of fraudulent
concealment is sufficient to survive a motion to dismiss, we
must determine the proper pleading standard. The Church con-
tends that a specific pleading rule controls.
   “In all averments of fraud, . . . the circumstances constitut-
ing fraud . . . shall be stated with particularity.”10 The height-
ened pleading requirement stems from the practice at common
law and under the codes and “imparts a note of seriousness and
encourages a greater degree of pre-institution investigation by
the plaintiff.”11
   [7] Because we have not specifically considered whether
§ 6-1109(b) applies to pleading fraudulent concealment to
avoid a statutory bar and because the Nebraska Court Rules
of Pleading in Civil Cases are modeled after the Federal Rules
of Civil Procedure, we may look to federal decisions for
guidance.12 The Eighth Circuit determined that “allegations of
fraud, including fraudulent concealment for tolling purposes,
[must] be pleaded with particularity.”13 While we are not

 8	
      Andres v. McNeil Co., supra note 6.
 9	
      Id.
10	
      Neb. Ct. R. Pldg. § 6-1109(b) (rev. 2008).
11	
      See 5A Charles Alan Wright & Arthur R. Miller, Federal Practice and
      Procedure § 1296 at 31 (3d ed. 2004).
12	
      See Ichtertz v. Orthopaedic Specialists of Neb., 273 Neb. 466, 730 N.W.2d
      798 (2007).
13	
      Great Plains Trust Co. v. Union Pacific R. Co., 492 F.3d 986, 995 (8th Cir.
      2007).
                                      - 100 -
                Nebraska Supreme Court A dvance Sheets
                        301 Nebraska R eports
              CHAFIN v. WISCONSIN PROVINCE SOCIETY OF JESUS
                             Cite as 301 Neb. 94

bound to follow this decision, we are persuaded by the Eighth
Circuit’s reasoning. Moreover, at oral argument, Chafin effec-
tively conceded that the “particularity” requirement applies
to fraudulent concealment. We now hold that allegations of
fraudulent concealment for tolling purposes must be pleaded
with particularity.
    [8,9] In order to survive a motion to dismiss, a complaint
alleging fraudulent concealment must plead with particularity
how material facts were concealed to prevent the plaintiff from
discovering the misconduct and how, through due diligence,
the plaintiff failed to discover his or her injury.14 “‘This means
the who, what, when, where, and how: the first paragraph of
any newspaper story.’”15
    Chafin’s brief argued that she “pled specific facts that sup-
port her further allegation that the original fraud regarding the
illegal taking of her baby was fraudulently concealed by the
[Church] until 2015.”16 At oral argument, she again claimed to
have alleged specific facts.
    So, what did Chafin plead to meet this requirement? Only
four statements in the amended complaint purport to address
the period from 1969 to 2015. These were:
• The Church “covered-up and concealed facts and witnesses
  necessary to pursue and [sic] action against them.”
• The concealment continued from the birth of her son until
  they were reunited in 2015.
• 
  The Church “continued in their fraudulent adoption and
  fraudulently covered up and concealed from Chafin any facts
  that would have put her on notice of the adoption fraud and,
  therefore, Chafin was unable to discover the necessary rel-
  evant facts to put her on notice of the adoption fraud perpe-
  trated against her.”

14	
      See Andres v. McNeil Co., supra note 5.
15	
      Great Plains Trust Co. v. Union Pacific R. Co., supra note 13, 492 F.3d at
      995 (quoting DiLeo v. Ernst & Young, 901 F.2d 624 (7th Cir. 1990)).
16	
      Brief for appellant at 6.
                             - 101 -
           Nebraska Supreme Court A dvance Sheets
                   301 Nebraska R eports
         CHAFIN v. WISCONSIN PROVINCE SOCIETY OF JESUS
                        Cite as 301 Neb. 94

• Chafin was unaware of her claims until 2015 as a result of
  the Church’s “deceptions, cover-up, concealment, misrepre-
  sentations, illegal suppression of evidence and destruction of
  evidence,” and remained unaware of potential legal claims
  because of the concealment.
    But all of these allegations are mere legal conclusions. As
to fraudulent concealment, the amended complaint simply does
not tell us the who, what, when, where, and how. Because
Chafin failed to particularly allege fraudulent concealment, the
statute of limitations did not toll. Thus, long before 2015, her
claims were time barred.
                      CONCLUSION
  We conclude that Chafin’s claims are barred by the statute
of limitations. We therefore affirm the order of the district
court granting the motion to dismiss her amended complaint
with prejudice.
                                                 A ffirmed.
