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You can search the entire site. or go to the recent opinions, or the chronological or subject indices. Miller v. Fowler (6/29/2018) sp-7255

Miller v. Fowler (6/29/2018) sp-7255

             Notice:   This opinion is subject to correction before publication in the P                            ACIFIC  REPORTER.   Readers  

             are requested to bring errors to the attention of the Clerk of the Appellate Courts, 303 K Street,                                   

             Anchorage, Alaska 99501, phone (907) 264-0608, fax (907) 264-0878, email                               

             corrections@akcourts.us.  



                            THE SUPREME COURT OF THE STATE OF ALASKA                                                          



CALVIN  N.  MILLER,                                                              )  

                                                                                 )      Supreme  Court  No.  S-16538  

                                        Appellant,                               )  

                                                                                                                                                                

                                                                                 )      Superior Court No. 3AN-13-08698 CI  

             v.                                                                  )  

                                                                                                                 

                                                                                 )     O P I N I O N  

                                             

JUNE FOWLER and HOMESTEAD                                                        )  

                                                                                                                                  

                                                                 

PROPERTY INVESTMENTS, INC.,                                                      )     No. 7255 - June 29, 2018  

                                                                                 )  

                                        Appellees.                               )  

                                                                                 )  



                                                                                                                                         

                                           

                           Appeal from the Superior Court of the State of Alaska, Third  

                                                                                                                     

                           Judicial District, Anchorage, Paul E. Olson, Judge.  



                                                                                                                                   

                           Appearances:  William D. English, Law Office of William  

                                                                                                                                   

                           English, Anchorage, for Appellant. J.E. Wiederholt, Aglietti,  

                                                                                                 

                           Offret & Woofter, Anchorage, for Appellees.  



                                                                                                                                    

                           Before:  Stowers, Chief Justice, Winfree, Maassen, Bolger,  

                                                     

                           and Carney, Justices.  



                                                  

                           BOLGER, Justice.  



I.           INTRODUCTION  



                                                                                                                                                                

                           The purchaser of an apartment building filed suit to bar the seller's attempt  



                                                                                                                                                                     

to  foreclose  on  the  property  after  the  purchaser  stopped  making  payments.                                                                                   The  



                                                                                                                                                          

purchaser also alleged that the seller had misrepresented the condition of the building's  



                                                                                                                                                                        

sewer lines at the time of sale.  The superior court granted summary judgment in the  



                                                                                                                                                                         

seller's favor on all of the misrepresentation claims on the basis that they were barred by  


----------------------- Page 2-----------------------

the statute of limitations.                                                                       During the trial, the superior court denied the purchaser leave                                                                                                                                                             



to amend his complaint.                                                                         After a bench trial on the remaining claims, the superior court                                                                                                                                                               



concluded   that the seller                                                                           did   not wrongfully                                                             foreclose on                                         the building                                            because the   



purchaser was in default.                                                                           The purchaser appeals these three decisions.                                                                                                                                     We reverse the                                   



grant of summary judgment because the seller failed to establish an absence of material                                                                                                                                                                                                                           



fact issues regarding when the purchaser's causes of action accrued. We vacate the order                                                                                                                                                                                                                                      



denying the wrongful foreclosure claim because the superior court erred when it found                                                                                                                                                                                                                                      



the purchaser in default.                                                                        We affirm the denial of the purchaser's motion to amend.                                                                                                                                               



II.                       FACTS AND PROCEEDINGS                                     



                          A.                        Facts  



                                                    In 2009 Calvin Miller purchased from June Fowler by warranty deed an                                                                                                                                                                                                                 



eight-unit, three-story apartment building located in Anchorage.                                                                                                                                                                                             Fowler is licensed by                                                      



the   Alaska   Real   Estate   Commission   and   served   as   the   listing   licensee   and   listing  



brokerage on the sale.                                                                  Miller and Fowler entered into a Purchase and Sale Agreement,                                                                                                                                               



and the sale was completed on September 2.                                                                                                                                     Miller made a down payment of $20,000                                                                                              



and   financed   the   remaining   balance   with   a   promissory   note   to   Fowler.     The   note  



provided that it would be repaid over a five-year term in monthly installments starting  



at $2,000 and increasing to $2,500 in October 2010.                                                                                                                                                        The note was secured by a deed of                                                                                               



trust, which Fowler recorded on September 4.                                                                                                                                          



                                                    As   part   of   the   sale,   Fowler   provided   the   written   property   disclosure  

                                                                                                                                                  1       In relevant part, Fowler disclosed defects in the  

 statement required under Alaska law.                                                                                                                                                                                                                                                                                                 



building's private sewer line: "Sewage: has plugged up. 2006 correction to sewer pipe  

                                                                                                                                                                                                                                                                                                                                 



with  excavation.                                                          All  records  of  service  calls  at  Alaska  sewer  and  drain.                                                                                                                                                                            Recent  

                                                                                                                                                                                                                                                                                                                   



problems - very occassional [sic] caused by tenants mis-use."  In addition to this written  

                                                                                                                                                                                                                                                                                                                       



                          1                         See AS 34.70.010.  

                                                                                                                               



                                                                                                                                                                    -2-                                                                                                                                                                         7255  


----------------------- Page 3-----------------------

                                                                                                                        

statement, Miller alleges that Fowler verbally told him at the time of the sale that any  



                                                                                                                            

structural problems with the sewer line had been resolved and that any lingering issues  



                                                                                                                          

were the result of tenant misuse.  Miller claims that Fowler cited examples of tenants  



                                                                                                                        

disposing of cat litter and dog waste in the toilet as the cause of any remaining drainage  



            

issues.  



                                                                                                                               

                    Miller alleges that soon after his purchase of the building, the sewer line  



                                                                                                                         

began posing significant issues.  He claims that tenants complained of sewage backing  



                                                                                                                      

up in the drains and overflowing from toilets, tubs, and sinks.  According to Miller, at  



                                                                                                                       

first he tried to address these issues himself.  He and his wife, Vicky Powell, manually  



                                                                                                                            

vacuumed the building's sewer line and transferred the waste to RV dump sites.  Miller  



                                                                                                                           

eventually hired plumbers to snake the sewer line and, after plumbing expenses started  



                                                                                                                               

adding up, later bought his own snake.  He claims that he sometimes snaked the line  



                                                                                                                                  

several times a week.  As the back-ups and overflows recurred, Miller was forced to  



                                                                         

refurbish the bathrooms of several of the units.  



                                                                                                                        

                    The sewer problems persisted and, in August 2012, Miller hired a plumber  



                                                                                                                         

who used a camera to view the inside of the building's sewer pipe.  The camera showed  



                                                                                                                            

tree roots growing through the pipe and numerous breaks and buckles in the pipe. Miller  



                                                                                                                    

claims that, after learning of the extent of the damage to the pipe, he began to investigate  



                                                                                                                        

the building's history of sewer issues.  Miller contacted a former owner of the building  



                                                                                                                                

who had purchased it from Fowler shortly before Miller had.  According to Miller, the  



                                                                                                                          

former owner had owned the building for about six months and had experienced similar  



                                                                                                                            

issues with the sewer line. The former owner exhausted his funds trying to fix the sewer  



                                                                                                                                  

issues and ultimately lost the building in foreclosure to Fowler, who in turn sold it to  



                                                                                                                             

Miller.  Miller also spoke to some of the building's tenants, many of whom were long- 



                                                                                                                                

time residents.  Several of them told Miller that the sewage issues had been ongoing for  



                                                                                                                          

years,  including  during  the  time  Fowler  owned  the  building.                                   In  addition,  Miller  



                                                                -3-                                                         7255
  


----------------------- Page 4-----------------------

                                                                                                                            

consulted Anchorage officials who told him they had received several complaints about  



                                                                                                                           

the building's sewer line over the years, but had ultimately been informed that the issues  



                        

were resolved.  



                                                                                                                                  

                    Miller decided to reroute the building's sewer line to connect it with a  



                                                                                                                         

different segment of the public sewer. He claims that he secured a permit for the reroute  



                                                                                                                               

and hired engineers to design it, a process that was complicated by the proximity of the  



                                                                                                                        

new sewer line to Campbell Creek.  He alleges he spent over $100,000 on this process  



                                                                                                              

but ultimately exhausted his funds before the new line was constructed.  



                                                                                                                               

                    To  help  Miller  pay  for  the  repairs,  Fowler  agreed  to  a  series  of  



                                                                                                                          

modifications to the terms of the promissory note. First, in August 2012, Fowler agreed  



                                                                                                                             

to a modification that deferred and reduced monthly payments and reduced the note  



                                                                                                                         

balance.  The note balance was reduced on the condition that Miller provide Fowler  



                                                                                                                                

"Proof of Completed Repairs and Certification of Inspection by the Municipality of  



                                                                                                                                  

Anchorage of the Sewage System . . . by December 20, 2012."   Fowler agreed to a  



                                                                                                                     

second modification to the terms in September that further reduced monthly payments  



                                                                                                                             

and  the  note  balance.             Like  the  first  modification,  the  note  balance  reduction  was  



                                                                                                                              

conditioned on Miller providing the same proof of repairs by December 20, 2012.  



                                                                                                                                     

                    Fowler agreed to a third and final modification on November 12, 2012.  



                                                                                                                             

Only  this  modification  is  directly  at  issue  in  this  appeal.                             Unlike  the  prior  two  



                                                                                                                               

modifications, which took the form of typed letters from Fowler to the escrow bank, the  



                                                                                                                               

third modification is a handwritten one-page note fromFowler to Miller and Powell. The  



                                                                                                                      

third modification provides for two additional changes:  (1) "No payments of principal  



                                                                                                 

or interest on loan . . . until June 2013" and (2) "An additional credit of $80,000 to be  



                                                                                                                             

deducted from loan balance upon completion of certification of sewer upgrades."  



                                                                                                                               

                    In February 2013 counsel for Fowler sent Miller a letter declaring that the  



                                                                                                                               

modifications  were  "null  and  void"  and  stating  that  Miller  would  be  offered  no  



                                                               -4-                                                         7255
  


----------------------- Page 5-----------------------

reductions to offset the expenditures on the sewer line.                                                                                                    The letter instructed Miller to                                                 



fully pay all past due amounts on the note by May 15 and provide proof of insurance for                                                                                                                                                   



the building; it also requested copies of permits that he had secured for the repair project.                                                                                                                                                        



After Miller apparently failed to comply, Fowler commenced nonjudicial foreclosure                                                                                                                                



proceedings on the building in May 2013.  The notice of default stated that Miller had   



breached    the    deed    of    trust    by    failing    to    make    payments    on    the    note    since  



September 2012.                                   



                   B.                Proceedings  



                                      On August 7,  2013  Miller  sued  Fowler  and  her  company,  Homestead  

                                                                                                                                                                                                                 

Properties Investment, Inc., to stop the foreclosure.2  Miller's complaint raised several  

                                                                                                                                                                                                           



claims against Fowler: (1) wrongful foreclosure; (2) breach of contract; (3) breach of  

                                                                                                                                                                                                                                            



statutory                      and            professional                            duties;                 (4)           statutory                     and             common                        law             negligent  

                                                                                                                                                                                                                    



misrepresentation;                                       (5)           willful   misrepresentation;   (6)                                                             common                        law   intentional  

                                                                                                                                                                                                                



misrepresentation and fraud; (7) breach of the duty of good faith and fair dealing;  

                                                                                                                                                                                                                           



(8) extinguishment of the loan under illusory promise and promissory estoppel; and  

                                                                                                                                                                                                                                       



(9)  slander of title.   Miller asked the court to enjoin the foreclosure, to enforce the  

                                                                                                                                                                                                                                         



modifications to the note, and to award damages. Fowler counterclaimed for a judgment  

                                                                                                                                                                                                                      



of judicial foreclosure and for a judgment on the promissory note.  The superior court  

                                                                                                                                                                                                                                   



issued a preliminary injunction enjoining nonjudicial foreclosure during the pendency  

                                                                                                                      

of the suit.3  

                                   



                   2                 Miller initially named four additional defendants:  the broker for the sale   



of the building and his company, a property management company that Fowler had                                                                                                                                                         

utilized, and the title company trustee for the deed of trust. Fowler and her company are                                                                                                                                                 

the only remaining defendants on appeal; for simplicity, we refer to them collectively as                                                                                                                                                   

"Fowler."  



                   3                 After the superior court denied Miller's claims relating to the nonjudicial  

                                                                                                                                                                                                                  

                                                                                                                                                                                                             (continued...)  



                                                                                                                     -5-                                                                                                            7255
  


----------------------- Page 6-----------------------

                    In October 2013 Fowler moved for summary judgment on all of Miller's  



claims.  Fowler argued that Miller's claims were barred by the statute of limitations,  

                                                                                                                  



because they were based on misrepresentations that occurred four years prior, well  

                                                                                                                             



beyond the two- and three-year statutes of limitations applicable to tort and contract  

                                                                                                                       

claims,  respectively.4              Miller  opposed  summary  judgment,  urging  that  under  the  

                                                                                                                              



discovery rule his causes of action did not accrue until long after the sale date.  In the  

                                                                                                                               



alternative, he argued that Fowler was equitably estopped from pleading a statute-of- 

                                                                                                                    



limitations defense.  

                                 



                    In April 2014 the superior court granted summary judgment in Fowler's  

                                                                                                                      



favor on all of Miller's claims relating to the initial sale of the building in 2009:  breach  

                                                                                                                          



of     statutory         and      professional           duties,      negligent         misrepresentation,               willful  

                                                                     



misrepresentation, intentional misrepresentation and fraud, and breach of the duty of  

                                                                                                                                



good faith and fair dealing. The superior court concluded that the discovery rule did not  

                                                                                                                               



delay the accrual of these claims because, given "the serious and systemic nature of the  

                                                                                                                               



[building's sewage] problem and evidence that . . . Miller was aware of the problem soon  

                                                                                                                             



after the sale, a reasonable person would have investigated further wellbeforethreeyears  

                                                                                                                            



had passed." The superior court declined to grant summary judgment on Miller's claims  

                                                                                                                          



relating to the nonjudicial foreclosure because they were based on recent events and thus  

                                                                                                                              



were not barred by any statute of limitations.  

                                                                      



          3         (...continued)  



                                                                                                                               

foreclosure, the court issued a decree of foreclosure and authorized the sale of the  

                                                                                                                     

building in a judicial foreclosuresale. Thesuperior court also awarded Fowler attorney's  

                                                                                                                               

fees and the costs of foreclosure.   The superior court apparently never dissolved the  

                                                                  

injunction against nonjudicial foreclosure.  



          4         See AS 09.10.053 (contract claims); AS 09.10.070(a) (tort claims).  

                                                                                                                           



                                                               -6-                                                         7255
  


----------------------- Page 7-----------------------

                                                                                                                           

                    Miller's remaining claims against Fowler proceeded to a three-day bench  



                                                                                                                                 

trial beginning in September 2015.   On the second day of the trial, Miller moved to  



                                                                                                                

amend his complaint to assert the defense of unilateral mistake to Fowler's counterclaim  



                                                                                                                        

for foreclosure.  This motion was made on the basis of testimony by Powell that the  



                                                                                                                         

December  20,  2012  completion  deadline  had  not  been  mentioned  in  any  verbal  



                                                                                                                            

discussions with Fowler and the date the parties had actually discussed was in 2013  



                                                                                                         

rather than 2012.  The superior court denied the motion, stating:  "It is so untimely.  It  



                                                                                                                                 

is so prejudicial now at the time of the second day of the trial.  It's never been pled.  It  



                                                                                                                                  

has never been the position of the plaintiffs since the beginning of this case.  I find it  



                                

overly prejudicial."  



                                                                                                                              

                    In  December  2015  the  superior  court  issued  an  order  concluding  that  



                                                                                                                             

Fowler did not wrongfully foreclose on the building.  The court reasoned that the third  



                                                                                                                        

modification, though on its face silent as to any deadline for completion of repairs,  



                                                                                                                     

implicitly imposed a December 20, 2012 deadline.  Accordingly, the court reasoned,  



                                                                                                                                

"Miller defaulted on the agreement when he failed to complete the sewer repairs by  



                                                                                                                             

December 20, 2012."  It concluded that because Miller was in default and failed to cure,  



                                                                                  

Fowler did not wrongfully foreclose on the building.  



                                                                                                                          

                    Miller appeals three issues:  the grant of summary judgment on the statute  



                                                                                                                     

of  limitations issue, the order concluding that Fowler did not wrongfully foreclose  



                                                                                                                             

because Miller was in default, and the denial of his motion to amend the pleadings mid- 



                                                                                            

trial to include an affirmative defense of unilateral mistake.  



                                       

III.      STANDARD OF REVIEW  



                                                                                                                          

                    "We review a grant of summary judgment de novo, 'affirming if the record  



                                                                                                                                  

presents no genuine issue of material fact and if the movant is entitled to judgment as a  



                                                               -7-                                                         7255
  


----------------------- Page 8-----------------------

                                 5  

matter of law.' "                     "We must determine 'whether any genuine issue of material fact                                         



 exists,' and in so doing all factual inferences must be drawn in favor of - and the facts                                                                   



must be viewed in the light most favorable to - the party against whom summary                                                                     

                                              6  The accrual date on which the statute of limitations begins to  

judgment was granted."                                                                                                                                            

run is a question of fact.7                         For this reason, summary judgment is "[o]rdinarily . . . an  

                                                                                                                                                         

 inappropriatemeans of ascertaining when astatuteoflimitationscommences."8  "Where,  

                                                                                                                                                       



however, there exist uncontroverted facts that determine when a reasonable person  

                                                                                                                                                        

 should have been on inquiry notice, 'we can resolve the question as a matter of law.' "9  

                                                                                                                                                                        



Whether such uncontroverted facts exist is reviewed de novo, "adopting the rule that best  

                                                                                                                                                               

reflects precedent, reason, and policy."10                                          We similarly review the superior court's  

                                                                                                                                                        

 interpretation of contract language de novo.11                                            Finally, we review the superior court's  

                                                                                                                                                         

                                                                                                                                12   A superior court  

 denial of a motion to amend the pleadings for abuse of discretion.                                                                                         

                                                                                                            



             5            Kelly   v.   Municipality   of  Anchorage ,   270   P.3d   801,   803   (Alaska   2012)  



 (quoting  Beegan  v.  State,  Dep't  of  Transp.  & Pub.  Facilities,  195  P.3d  134,  138  (Alaska  

2008)).  



             6            Id. (quoting Nielson v. Benton, 903 P.2d 1049, 1051-52 (Alaska 1995)).  

                                                                                                                                                      



             7            Jones v. Westbrook, 379 P.3d 963, 967 (Alaska 2016).  

                                                                                                                      



             8            Palmer v. Borg-Warner Corp., 818 P.2d 632, 634 (Alaska 1990).  

                                                                                                                                           



             9            Id.  (quoting Mine  Safety  Appliances  Co.  v.  Stiles,  756  P.2d  288,  292  

                                                                                                                                                              

 (Alaska 1988)).  

                 



             10           Egner v. Talbot's, Inc., 214 P.3d 272, 277 (Alaska 2009).  

                                                                                                                            



             11           Alaska Fur Gallery, Inc. v. Hwang, 394 P.3d 511, 514 (Alaska 2017).  

                                                                                                                                                                 



             12           Patterson v. GEICO Gen. Ins. Co., 347 P.3d 562, 568 (Alaska 2015).  

                                                                                                                                                   



                                                                                -8-                                                                         7255
  


----------------------- Page 9-----------------------

abuses its discretion when its denial "is manifestly unreasonable."                                               13  



IV.	        DISCUSSION  



                       Miller appeals three separate decisions by the superior court:  the grant of  

                                                                                                                                                   



summary judgment based on the statute of limitations, the interpretation of the third  

                                                                                                                                              



modification to include a December 20, 2012 deadline, and the denial of Miller's motion  

                                                                                                                                          



to amend the pleadings to include an affirmative defense of unilateral mistake.   We  

                                                                                                                                                        



address each issue in turn.  

                                      



            A.	        Granting Summary Judgment On The Basis That Some Of Miller's  

                                                                                                                                        

                       Claims Were Barred By The Statute Of Limitations Was Error.  

                                                                                                                                  



                       Miller argues that the superior court erred in concluding that some of his  

                                                        



claims - those originating from alleged misrepresentations made at the time of the sale  

                                                                                                                                                



- were barred by the statute of limitations.  The statute of limitations restricts the time  

                                                                                                                                               

a plaintiff has to bring a cause of action; it begins to run after a cause of action accrues.14  

                                                                                                                                                        



"Although a cause of action generally accrues when the plaintiff incurs an injury, accrual  

                                                                                                                                          



can be delayed under [the] . . . discovery rule" if injury "is not immediately apparent" at  

                                                                                                                                                   

the time of a wrongful act.15   The common law discovery rule provides that a cause of  

                                                                                                                                     



action accrues on the date "when a reasonable person has enough information to alert  

                                                                                                                                              



that person that he or she has a potential cause of action or should begin an inquiry to  

                                                                                                                                                   

protect his or her rights."16  Determining this date "requires a 'fact-intensive' analysis"17  

                                                                                                                                    



            13         Ranes & Shine, LLC v. MacDonald Miller Alaska, Inc.                                          , 355 P.3d 503, 508         



(Alaska 2015).              



            14         Cameron  v.  State,  822  P.2d   1362,   1365  (Alaska   1991).   



            15         Gefre  v.  Davis  Wright  Tremaine,  LLP,  306  P.3d  1264,  1274  (Alaska  2013).  



            16         Reasner  v.  State,  Dep't  of  Health  & Soc.  Servs.,  Office  of  Children's  Servs.,  



394  P.3d  610,  614  (Alaska  2017)  (quoting  Mine  Safety  Appliances  Co.  v.  Stiles,  756  P.2d  

                                                                                                                              (continued...)  



                                                                        -9-	                                                                 7255
  


----------------------- Page 10-----------------------

because "[w]hat a plaintiff should have known about her cause of action depends upon                                                         



                                                                 18  

all of the surrounding circumstances."                                                                                              

                                                                     Generally, inquiry notice is when an individual  



                                                                                                                                               

"has sufficient information to prompt an inquiry, not . . . when [the individual] has  

                                                                                                                        19   In the context  

                                                                                                                                         

                                                                                                           

specific information establishing each element of [a] cause of action." 



of claims alleging common law fraud and misrepresentation, we have held that a plaintiff  

                                                                                                                                       

need not have "actual knowledge of scienter" for the claim to accrue.20                                                          Rather, the  

                                                                                                                                                



defrauded individual need only be on inquiry notice of a misrepresentation, not that the  

                                                                                                                                                



                                                       21  

misrepresentation was intended.  

                                                            



                       Miller filed his complaint on August 7, 2013.  Accordingly, assuming the  

                                                                                                                                                



minimum  two-year  statute  of  limitations  applies,  all  of  his  tort  and  professional  

                                                                                                                               

misconduct claims must have accrued no earlier than August 7, 2011 to be timely.22   The  

                                                                                                                                               



            16         (...continued)  



                                             

288, 291 (Alaska 1988)).  



            17         Id.  (quoting  Ranes  &  Shine,  355  P.3d  at  509).   



            18         Breck  v.  Moore,  910  P.2d  599,  604  (Alaska   1996).   



            19         Reasner,  394  P.3d  at  614  (emphasis  omitted).   



           20          City   of   Fairbanks   v.  Amoco   Chem.   Co.,   952   P.2d   1173,   1179   (Alaska  



 1998);  see also  Bauman v.  Day, 892 P.2d 817,  826 n.13 (Alaska 1995) ("[N]othing in  

[a  prior  case]  relaxes  the  'reasonable  person'  standard  so  much  as  to  allow  the  statute  of  

limitations  to  run  only when  the  person  has a   ctual k                             nowledge  of  the  fraud.").   Amoco  

dealt   with   a   statutory   discovery   rule,   but   in   doing   so   it   discussed   the   common   law  

discovery  rule.   952  P.2d  at   1177-80.  



           21          Bauman, 892 P.2d at 826 n.13.  

                                                                     



           22          Like the superior court, we find it unnecessary to determine which specific  

                                                                                                                                        

statute of limitations (two-year or three-year) applies to each of Miller's claims because,  

                                                                                                                                       

even assuming the shorter limitations period applies to all of them, our conclusion is the  

                                                                                                                                                

                                                                                                                                (continued...)  



                                                                       -10-                                                                 7255
  


----------------------- Page 11-----------------------

 sale of the building was completed on September 2, 2009.                                                                                                                                 The key question then is                                  



whether a reasonable person in Miller's position would have been on notice before                                                                                                                                                                    



August 7, 2011 (just under two years after purchasing the building) that he either had a                                                                                                                                                                              



potential   cause   of   action   against   Fowler   for   her   misrepresentations   relating   to  the  

                                                                                                                                                                                                                    23   On this record,  

building's sewage line or should begin an inquiry to protect his rights.                                                                                                                                                                            



we cannot say as a matter of law that a reasonable person would have been on notice.  

                                                                                                                                                                                                                                                  



                                         As the movant, Fowler bore the burden of showing "through admissible                                                                                                                           

                                                                                                                                                                               



 evidence (1) the absence of genuine fact disputes, and (2) [her] entitlement to judgment                                                                                                                                                    



                                                            24  

 as a matter of law."                                             However, at the summary judgment stage, Fowler failed to offer                                                                                                                          



 "uncontroverted   facts"   establishing   that   "a   reasonable   person   should   have   been   on  



                                                                                                                     25  

inquiry notice" before August 7, 2011.                                                                                      Fowler's summary judgment motion appeared                                                                         



to assume Miller's claims accrued on the date of purchase, and thus made no mention of                                                                                                                                                                              



 another possible accrual date. However, there is no evidence that Miller was on inquiry                                                                                                                                                           



notice   of   Fowler's   alleged  misrepresentation   immediately   upon   purchasing   the  



                            26  

building.                                                                                                                                                                                                                                     

                                       Fowler's  pre-sale  disclosure  statement  acknowledged  that  the  building  



                                                                                                                                                                                                                                                          

 experienced some  sewer issues in the past and did not guarantee that the issues were  



 (...continued)
  

 same.   In making this assumption, we express no view on the merits of this question.
                                                                                                                                                                               



                     23                  See  Egner  v.  Talbot's,  Inc.,  214  P.3d  272,  278  (Alaska  2009).  



                     24                  Id.  



                     25                  Palmer  v.  Borg-Warner   Corp.,   818  P.2d  632,  634  (Alaska   1990)  (citing  



Mine  Safety  Appliances  Co.  v.  Stiles,  756  P.2d  288,  292  (Alaska   1988)).   



                     26                  See Bauman, 892  P.2d  at 828 (reasoning that homeowners  were not  initially  



 on  inquiry  notice  of  permafrost-related  issues  with  their  property  "because  the  presence  

 of  permafrost  is  not  something  that  [the  owners]  could  ascertain  merely  by  observing  the  

property").  



                                                                                                                               -11-                                                                                                                       7255
  


----------------------- Page 12-----------------------

                                                                                                                     

entirely resolved.  But it further asserted that any lingering issues with the building's  



                                                                       

sewer were attributable to "tenants mis-use."  Accordingly, even assuming that Miller  



                                                                                                                               

did experience significant issues with the building's sewer system beginning on the date  



                                                                                                                               

of purchase, there is a genuine dispute of material fact whether it was reasonable for him  



                                                                              

to initially attribute these issues to tenant misuse.  



                                                                                                                     

                    In addition, Fowler failed to offer any evidence establishing an alternative  



                                                                                                                                

accrual date other than the date of purchase.  The record contains scant evidence on the  



                                                                                                                               

precise nature and extent of the sewage issues during the crucial two-year period.  The  



                                                                                                                                  

only exhibit attached to Fowler's summary judgment motion pertaining to the timing of  



                                                                                                                                      

the sewer issues was a May 2013 letter from counsel for Fowler to counsel for Miller.  



                                                                                                                              

In it, Fowler's counsel asserted that the building's property manager denied "having ever  



                                                                                                                                 

received  a  single  complaint  respecting  the  sewage  issues  claimed."                                     (Emphasis  in  



                                                                                                                       

original.)        Further,  "neither  tenants  nor  neighbors  [of  the  building]  ha[d]  reported  



                                                                                                                         

'barrels' of sewage being transported from the building on the industrial scale" claimed  



                                                                                                                      

by Miller.  Therefore, the only evidence Fowler offered with her summary judgment  



                                                                                                                                      

motion indicated that the building's sewage issues were neither severe nor frequent.  



                                                                                                                            

Fowler's version of the facts would weigh in favor of a later inquiry notice date, given  



                                                                                                                          

that the fewer and less severe the sewer issues were, the less cause Miller had to believe  



                                                                                                                       

that Fowler made misrepresentations about the sewage system.   Moreover, Fowler's  



                                                                                                                 

version of the facts conflicts with Miller's own account that he started experiencing  



                                                                                                                                      

significant issues with the sewer line "[f]rom nearly the beginning" of his ownership.  



                                                                                                                             

Given this record, Fowler did not establish an absence of factual dispute regarding when  



                                                                             

Miller's claims accrued under the discovery rule.  



                                                                                                                           

                    We conclude, based on this record, that "[r]easonable minds may differ"  



                                                                                                                           

over whether Miller should have been aware that he had a potential cause of action  



                                                                                                                                

against Fowler or that he should have begun an inquiry to protect his rights during the  



                                                               -12-                                                         7255
  


----------------------- Page 13-----------------------

                                           27  

critical two-year period.                      Therefore, we cannot conclude as a matter of law that Miller's                                 



claims accrued during this time.                            We accordingly reverse the superior court's grant of                                        

summary judgment on the basis that the claims were barred by the statute of limitations,                                                                 28  



                                                                       29  

                                                 

and we remand for further proceedings. 



            B.	         TheDenial Of Miller's WrongfulForeclosureClaimWas BasedOnAn  

                                                                                                                                                       

                        Erroneous               Interpretation                 Of       The        Modification                To       The        Sale  

                                                                                                                                                  

                        Agreement.  



                        Miller also appeals the court's post-bench-trial order denying his wrongful  

                                                                                                                                            

foreclosure claim and related claims.30  

                                                       

                                                                                                                                               

                                                                         This denial was based on the superior court's  



                                                                                                                                            

interpretation of the third modification to the Agreement. "When interpreting a contract,  



                                                                                                                                               31  

                                                                                                                                                     

[our] goal 'is  to  give  effect to  the reasonable expectations of the parties.'  "                                                                 We  



            27	         Pedersen v. Zielski               , 822 P.2d 903, 907 (Alaska 1991).                  



            28          Because we reverse the grant of summary judgment on this basis, we do not  

                                                                                                                                                       

address Miller's alternative equitable estoppel argument.  

                                                                                                         



            29          We note that on remand the superior court may wish to hold an evidentiary  

                                                                                                                                        

hearing on the statute of limitations issue.  Cf. John's Heating Serv. v. Lamb, 46 P.3d  

                                                                                                                                                    

 1024, 1033 (Alaska 2002) (remanding "the statute of limitations issue to the superior  

                                                                                                                                             

court for determination as a preliminary question of fact" the question "whether the  

                                                                                                                                                      

[plaintiffs] had sufficient information [during the relevant time period] to constitute  

                                                                                                                                          

inquiry notice under the discovery rule"). We have repeatedly encouraged that, before  

                                                                                                                  

granting summary judgment on statute of limitation grounds, a trial court should hold an  

                                                                                                                                                        

evidentiary hearing on factual issues to determine when a cause of action accrued.  See  

                                                                                                                                                      

Gefre v. Davis Wright Tremaine, LLP, 306 P.3d 1264, 1278-79 (Alaska 2013); Erkins  

                                                                                                                                                

v. Alaska Tr. LLC, 265 P.3d 292, 301 (Alaska 2011); Pederson, 822 P.2d at 908.  

                                                                                                                                                   



            30          The  remaining  claims  were  wrongful  foreclosure,  breach  of  contract,  

                                                                                                                                            

extinguishment of the loan under illusory promise and promissory estoppel, and slander  

                                                                                                                                               

of title.  

      



            31          Nautilus Marine Enters., Inc. v. Exxon Mobil Corp., 305 P.3d 309, 315  

                                                                                                                                                     

(Alaska 2013) (quoting Villars v. Villars, 277 P.3d 763, 768 (Alaska 2012)).  

                                                                                                                                            



                                                                          -13-	                                                                    7255
  


----------------------- Page 14-----------------------

"ascertain[] the parties' reasonable intentions by looking 'to the language of the disputed                                                                       



provision and other provisions, relevant extrinsic evidence, and case law interpreting                                                                    

                                              32     It  is  therefore "not  necessary  to  find  that  an  agreement  is  

similar  provisions.'   "                                                                                                                                                     



ambiguous  before  looking  to  extrinsic  evidence  as  an  aid  in  determining  what  it  

                                                                                                                                                                               

means."33   "Moreover, interpretation of a contract term does not take place in a vacuum,  

                                                                                                                                                                

but rather requires consideration of the provision and agreement as a whole."34  

                                                                                                                                               



                            Thethird modification provides for two changes to theAgreement: (1) "No  

                                                                                                                                                                           



payments of principal or interest on loan . . . until June 2013" and (2) "An additional  

                                                                                                                                                              



credit of $80,000 to be deducted from loan [balance] upon completion certification of  

                                                                                                                                                                              



sewer upgrades as previously described by the 4 permits issued."  This modification  

                                                                                                                                                        



followed  two  prior  modifications,  which  had  also  deferred  and  reduced  monthly  

                                                                                                                                             



payments  on  the  note  and  reduced  the  principal  on  the  note  based  on  Miller's  

                                                                                                                                                                 



expenditures on the sewage repairs.  Each of these two prior modifications conditioned  

                                                                                                                                                          



the reduction in principal - but not the deferment of payments - on Miller providing  

                                                                                                                                                               



Fowler proof that repairs had been completed and inspected by December 20, 2012.  

                                                                                                                                                                               



                            The superior court interpreted the third modification to implicitly contain  

                                                                                                                                                                   



the same December 20, 2012 deadline for both changes - the reduction in principal and  

                                                                                                                                                                           



deferment of payments.   However, the two prior modifications  do not support this  

                                                                                                                                                                          



interpretation.  Neither of the two prior modifications require the December 20, 2012  

                                                                                                                                                                        



repair deadline to be met in order for monthly payments to be deferred. Rather, deferral  

                                                                                                                                                                   



              32           Flint Hills Res. Alaska, LLC v. Williams Alaska Petroleum, Inc.                                                                    , 377 P.3d     



959, 975 (Alaska 2016) (quoting                                     W. Pioneer, Inc. v. Harbor Enters., Inc.                                        , 818 P.2d 654,       

656 (Alaska 1991)).        



              33           Id. (quoting Estate of Polushkin ex rel. Polushkin v. Maw, 170 P.3d 162,  

                                                                                                                                         

 167 (Alaska 2007)).  

                           



              34           Id. (quoting Mahan v. Mahan, 347 P.3d 91, 95 (Alaska 2015)).  

                                                                                                                                                               



                                                                                     -14-                                                                               7255
  


----------------------- Page 15-----------------------

of monthly payments is unqualified. In both prior modifications, the December 20, 2012                                                                                                                   



repair deadline applies only to the reduction of the note balance. The prior modifications                                                                                         



therefore do not indicate that the deferral of payment in the third modification was                                                                                                                      



conditioned on any deadline.                                              



                                 Moreover, the superior court stated that extrinsic evidence could not be                                                                                                     



considered in interpreting a contract unless it was ambiguous.  But a contract need not                                                                                                                      

                                                                                                                                                                                        35     The case  

be ambiguous for a court to consider extrinsic evidence in its interpretation.                                                                                                                            



cited by the superior court involves the standard for deed interpretation, which prohibits  

                                                                                                                                                                                               



a  court  from  considering  extrinsic  evidence,  rather  than  the  standard  for  contract  

                                                                                                                                                                                                

interpretation, which permits such consideration.36                                                                              Given this error and the evidence  

                                                                                                                                                                                               



contradicting the superior court's interpretation, we vacate the superior court's denial of  

                                                                                                                                                                                                                



Miller's wrongful foreclosure claim and related claims and remand these claims for  

                                                                                                                                                                                                             



reconsideration.  On remand, the superior court should consider any available extrinsic  

                                                                                                                                                                                                



evidence in interpreting the modification, including the testimony of the parties.  

                                                                                                                                                                                   



                 C.	             The Superior Court Did Not Abuse Its Discretion In Denying Miller  

                                                                                                                                                                                                    

                                 Leave To Amend His Complaint Mid-Trial.  

                                                                                                                        



                                 Miller's final point on appeal challenges the superior court's denial of his  

                                                                                                                                                                                                              



motion to amend his complaint to assert the defense of unilateral mistake to Fowler's  

                                                                                                                                                                                               

counterclaim for foreclosure.37                                                This motion was made on the second day of the trial,  

                                                                                                                                                                                                         



                35	              Id.    



                36               See HP            Ltd. P'ship v. Kenai River Airpark, LLC                                                         , 270 P.3d              719, 726              (Alaska  



                  

2012).  



                37               Miller also urges that the superior court should have permitted him to  

                                                                                                                                                                                                               

amend his pleadings to include a request for contract reformation. However, Miller does  

                                                                                                                                                                                                          

not cite to where he requested such relief in the superior court, nor has our review of the  

                                                                                                                                                                                                             

trial transcript revealed any such request.  The only basis upon which Miller moved to  

                                                                                                                                                                                                                

                                                                                                                                                                                        (continued...)  



                                                                                                     -15-	                                                                                              7255
  


----------------------- Page 16-----------------------

right after Powell testified that the December 20, 2012 completion deadline had not been                                                                                                                                                                                           



mentioned in any discussions with Fowler and that the date the parties had actually                                                                                                                                                                                     



discussed was in 2013 rather than 2012.                                                                                                The superior court denied the motion from the                                                                                                     



bench, stating:                                    "It is so untimely.                                             It is so prejudicial now at the time of the second day                                                                                                              



of the trial. It's never been pled. It has never been the position of the plaintiffs since the                                                                                                                                                                                           



beginning of this case.  I find it overly prejudicial."  Miller argues that this denial was   



 an   abuse   of   discretion   because   he   raised   a   valid   defense   of   unilateral   mistake,   the  



 supporting facts of which came to light for the first time at trial.                                                                                                                                                                   Although Miller   



concedes his motion to amend "came late in the case," he argues that Fowler would not                                                                                                                                                                                                   



have been prejudiced by granting it because she would have still had the opportunity to                                                                                                                                                                                                     



cross-examine him.                                                  



                                             Alaska Civil Rule 15(a) provides that after a responsive pleading has been                                                                                                                                                            



 served and the case has been set for trial, a party may amend a pleading only by leave of                                                                                                                                                                                                  



the court or by written consent of the adverse party.                                                                                                                        It further provides that the superior                                                     

                                                                                                                                                                                                             38  Even so, denial of leave  

court "shall . . . freely give[]" leave "when justice so requires."                                                                                                                                                                                                               



to amend is justified in cases of "undue delay, bad faith or dilatory motive . . . [by] the  

                                                                                                                                                                                                                                                                                        

movant," and, among other circumstances, "undue prejudice to the opposing party."39  

                                                                                                                                                                                                                                                                                                     



"In deciding whether the superior court has abused its discretion by denying a motion  

                                                                                                                                                                                                                                        



 (...continued)
  

 amend was unilateral mistake.  Accordingly, the superior court could not have abused
  

                                                                                                                                                                                                                                                                       

its discretion in refusing to grant a motion that was never presented to it.  See Parks v.
  

                                                                                                                                                                                                                                                                                            

Parks, 214 P.3d 295, 304 (Alaska 2009) (holding trial court did not abuse discretion in
  

                                                                                                                                                                     

 failing to address argument not raised before it).
  



                       38                    Alaska R. Civ. P. 15(a).  

                                                                                                         



                       39                    Lingley v. Alaska Airlines, Inc. , 373 P.3d 506, 512 (Alaska 2016) (first  

                                                                                                                                                                                                                                                                                  

omission and alteration in original) (quoting Patterson v. GEICO Gen. Ins. Co., 347 P.3d  

                                                                                                                                                                                                                                                                                    

 562, 569 (Alaska 2015)).  

                                                                                       



                                                                                                                                           -16-                                                                                                                                    7255
  


----------------------- Page 17-----------------------

to amend, we balance 'the possible prejudice to [the nonmoving party] in defending [the                                                                                



new] claims with the potential harm caused to [the moving party] if he is precluded from                                                                             

litigating these issues.' "                      40  



                                                                                                                            

                           Here, both Miller's undue delay and the undue prejudice the amendment  



                                                                                                                                                                  

could have caused to Fowler justified denial of the motion to amend.   First, Miller  



                                                                                                                                                                        

delayed in moving to amend until the second day of trial, over two years after his  



                                                                                                                                                                        

complaint was filed and over four months after the last deadline for motions set in the  



                                                                                                                                                                

pre-trial order. Although Miller claims delay was justified because the testimony serving  



                                                                                                                                                                       

as the basis for the motion was elicited for the first time at trial, he overlooks the fact that  



                                                                                                                                                         

this testimony was offered by his wife.  Given the source of this testimony, reasonable  



                                                                                                                             

diligence could have elicited it well before the second day of trial.  



                                                                                                                                                                    

                           Moreover, Fowler would be unduly prejudiced if this amendment were  



                                                                                                                                                            

permitted.  Generally, the further along a case has proceeded, the more likely prejudice  



                                                                                                                                                                   

to the nonmoving party will outweigh hardship to the moving party. For example, where  



                                                                                                                                                           

a  plaintiff  moved  to  amend  "about  two  months  after  she  filed  her  first  amended  



                                                                                                                                                             

complaint," before discovery had commenced or a trial date had been set, the hardship  



                                                                                                                                                            

to the plaintiff of denying the motion "outweigh[ed] any prejudice to [the opposing  

                41    In contrast, where a motion to amend was filed approximately three weeks  

party]."                                                                                                                                                          



before the trial was set to begin and more than two years after the complaint was filed,  

                                                                                                                                                                    



             40            Patterson,   347   P.3d   at   569   (alterations   in   original)   (quoting   Miller   v.  



Safeway, Inc.              , 102 P.3d 282, 288 (Alaska 2004)).                                       



             41            Lingley, 373 P.3d at 513; see also Larson v. Benediktsson, 152 P.3d 1159,  

                                                                                                                                                                   

 1163 (Alaska 2007) (affirming grant of motion to amend when it was filed "shortly after  

                                                                                                                                                                      

the sixty-day deadline for amending as a matter of right had expired").  

                                                                                                                           



                                                                                   -17-                                                                             7255
  


----------------------- Page 18-----------------------

we found undue prejudice based on the fact that the opposing party would not be able   



                                                                                                                                                                                                                 42  

"to seek discovery or file a dispositive motion before the start of trial."                                                                                                                                             



                                       Miller's motion presents an even more prejudicial scenario: it was not filed  

                                                                                                                                                                                                                                                   



"on the eve of trial" but rather in the midst of the trial.  Given its timing, Fowler would  

                                                                                                                                                                                                                                             



have had no opportunity to seek discovery or file a dispositive motion. Although Miller  

                                                                                                                                                                                                                                              



insists that Fowler would not have been prejudiced because she would have had the  

                                                                                                                                                                                                                                                      



opportunity  to  cross-examine  him,  he  cites  no  authority  that  this  alone  would  be  

                                                                                                                                                                                                                                                       



sufficient to eliminate prejudice.   The superior court did not abuse its discretion in  

                                                                                                                                                                                                                                                         



denying Miller's motion to amend his complaint to assert a defense of unilateral mistake.  

                                                                                                                                                                                                                                                                   



V.                  CONCLUSION  



                                       We AFFIRM the denial of the motion  to amend.                                                                                                                 We REVERSE the  

                                                                                                                                                                                                                                                     



summary judgment order and we VACATE the order granting judgment in Fowler's  

                                                                                                                                                                                                                                     



favor on the remaining claims.  We REMAND for further proceedings consistent with  

                                                                                                                                                                                                                                                   



this opinion.  

                                       



                    42                 McAnally v. Thompson                                                , 397 P.3d 322, 327 (Alaska 2017);                                                                   see also Red Elk                      



v.  McBride, 344 P.3d 818, 823 (Alaska 2015) (affirming denial of leave to amend when                                                                                                                                                           

motion filed over a year after complaint and a month before trial because it would be                                                                                                                                                                   

overly prejudicial to opposing party);                                                                          Prentzel v. State, Dep't of Pub. Safety                                                                           , 169 P.3d   

573, 592 (Alaska 2007) (affirming denial of leave to amend when motion was filed "on                                                                                                                                                                 

the eve of trial");                               Valdez Fisheries Dev. Ass'n v. Alyeska Pipeline Serv. Co.                                                                                                             , 45 P.3d 657,             

671 (Alaska 2002) (affirming superior court finding of undue prejudice when the motion                                                                                                                                                     

to amend was filed seven weeks before trial).                                                                         



                                                                                                                          -18-                                                                                                                   7255
  

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