UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
No. 04-2499
ANTHONY A. FARLEY,
Plaintiff - Appellant,
versus
CSX TRANSPORTATION, INCORPORATED,
Defendant - Appellee.
Appeal from the United States District Court for the District of
South Carolina, at Florence. R. Bryan Harwell, District Judge.
(CA-03-3306-4-27)
Submitted: June 30, 2005 Decided: August 17, 2005
Before MOTZ, TRAXLER, and DUNCAN, Circuit Judges.
Vacated and remanded by unpublished per curiam opinion.
Mary P. Miles, West Columbia, South Carolina, for Appellant.
Ronald K. Wray, II, John R. Bell, Jr., GALLIVAN, WHITE & BOYD,
P.A., Greenville, South Carolina, for Appellee.
Unpublished opinions are not binding precedent in this circuit.
See Local Rule 36(c).
PER CURIAM:
Anthony A. Farley appeals the district court’s order
dismissing his civil action as time-barred under Fed. R. Civ. P.
12(b)(6). Farley is currently employed by CSX Transportation
(“CSX”) as a locomotive engineer, based in Florence, South
Carolina. On September 19, 2003, Farley filed the instant action
alleging breach of contract, quasi-contract, and conversion.
In his complaint, Farley alleged that sometime in 1996,
he designed a handheld safety device for use in General Electric
locomotive cabs. In September 1996, and in March 1997, Farley
delivered a picture and a prototype of his device to CSX personnel.
Although he received no response, in January 1998, CSX nominated
Farley for the “Cut-Through-the-Knot” award for his design. As a
reward, CSX offered to send Farley and his wife to dinner
“somewhere nice” and told Farley to select a gift from the company
catalogue. Farley believed that “a number of other CSX employees
had received compensation for similar contributions,” but he was
not offered any additional compensation for his device at that
time. At some point, Farley actively sought monetary compensation
for the device. However, the complaint alleges that on
September 29, 2000, Farley received a letter from an Assistant Vice
President, stating that “the company ha[d] provided you with its
final answer to your request for cash payments.” The complaint
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further alleges that on or about May 1, 2001, Farley noticed that
his safety device was beginning to appear on CSX locomotives.
The district court granted the employer’s motion to
dismiss, finding that Farley’s cause of action accrued in 1998,
when he was offered dinner and a gift for his design instead of
monetary compensation, and his claims were therefore barred under
the South Carolina three-year statute of limitations. Farley
appeals.
This court reviews de novo a district court’s dismissal
of a complaint for failure to state a claim upon which relief can
be granted pursuant to Fed. R. Civ. P. 12(b)(6). Duckworth v.
State Admin. Bd. of Election Laws, 332 F.3d 769, 772 (4th Cir.
2003). The statute of limitations is an affirmative defense that
may be brought under Rule 12(b)(6) if the time bar is apparent from
the face of the complaint. Dean v. Pilgrim’s Pride Corp., 395 F.3d
471, 474 (4th Cir. 2005). A motion to dismiss for failure to state
a claim should be granted only if it appears beyond doubt that a
plaintiff can prove no set of facts in support of a claim that
would entitle him to relief. Conley v. Gibson, 355 U.S. 41, 45-46
(1957). The factual allegations set forth in the complaint must be
accepted as true, Zinermon v. Burch, 494 U.S. 113, 118 (1990), and
the court must view those allegations in the light most favorable
to the plaintiff. Scheuer v. Rhodes, 416 U.S. 232, 236 (1974).
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Under South Carolina law, an action for breach of
contract must be brought within three years from the date the
action accrued. S.C. Code Ann. § 15-3-530(1) (Supp. 1997); see
also Simmons v. S.C. State Ports Auth., 694 F.2d 63, 64 (4th Cir.
1982) (citing previous version of statute). “Pursuant to the
discovery rule, a breach of contract action accrues not on the date
of the breach, but rather on the date the aggrieved party either
discovered the breach, or could or should have discovered the
breach through the exercise of reasonable diligence.” Maher v.
Tietex Corp., 331 S.C. 371, 376 (Ct. App. 1998). Likewise, a cause
of action for conversion accrues when the plaintiff knew, or
through the exercise of due diligence, should have known of the
defendant’s wrongful possession of the plaintiff’s property. See
Roberts v. James, 160 S.C. 291 (1931). “A cause of action should
have been discovered through exercise of reasonable diligence when
the facts and circumstances would have put a person of common
knowledge and experience on notice that some right had been invaded
or a claim against another party might exist.” Maher, 331 S.C. at
376.
Farley first asserts that his cause of action accrued in
May 2001, when he had “an accurate sense of whether his invention
ha[d] monetary value.” The district court rejected this claim,
holding that South Carolina does not allow the plaintiff to wait
until he ascertains the full extent of the damage, but instead
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requires that a plaintiff promptly investigate the existence of a
claim when facts and circumstances place the plaintiff on notice.
We agree. Binkley v. Burry, 352 S.C. 286, 297-98 (Ct. App. 2002)
(holding that once a reasonable person has reason to believe that
some claim against another party might exist, the requirement of
reasonable diligence to investigate takes precedence over the
inability to ascertain the amount of damages or even the
possibility that damages may be forthcoming at all); see also
Dean v. Ruscon Corp., 321 S.C. 360, 364 (1996) (“[T]he fact that
the injured party may not comprehend the full extent of the damage
is immaterial.”).
Instead, relying on Maher, 331 S.C. 371, the district
court held that Farley should have known “by early 1998, when he
was nominated for the “Cut-Through-the-Knot” award, treated to
dinner, and told to choose a gift . . . that CSX was not going to
pay him cash compensation.” However, we conclude that Maher is
distinguishable from the instant case. While the plaintiff in
Maher received what could only be viewed as negative responses, at
a discrete point in time, to his inquiries regarding his
entitlement to a bonus, Farley was singled out and praised for his
contribution to CSX. Accordingly, we find that viewing the facts
in the complaint in a light most favorable to the plaintiff, there
was no reason for Farley to assume that the award, dinner and gift
he received were an indication that he would not receive cash
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compensation. On the contrary, Farley’s complaint implies that he
still believed that a cash compensation might be forthcoming, and
based upon this belief he continued to pursue monetary
compensation.
Although we disagree with the district court’s finding
that the cause of action accrued in 1998, when Farley was nominated
for an award, the record before us is not sufficiently developed to
determine if the cause of action accrued prior to September 29,
2000, which the complaint alleges to be the date that Farley’s
efforts to obtain monetary compensation were finally rejected by
CSX. We therefore vacate the district court’s order and remand for
further proceedings. We dispense with oral argument because the
facts and legal contentions are adequately presented in the
materials before the court and argument would not aid the
decisional process.
VACATED AND REMANDED
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