UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
No. 15-1975
CIVISTA HEALTH, INCORPORATED; CIVISTA MEDICAL CENTER, INC.,
Plaintiffs – Appellants,
v.
GILBANE BUILDING COMPANY,
Defendant – Appellee,
and
TRAVELERS PROPERTY CASUALTY COMPANY OF AMERICA,
Defendant.
Appeal from the United States District Court for the District of
Maryland, at Greenbelt. Alexander Williams, Jr., District
Judge. (8:13-cv-00284-RWT)
Submitted: October 4, 2016 Decided: November 23, 2016
Before KEENAN, DIAZ, and FLOYD, Circuit Judges.
Vacated and remanded by unpublished per curiam opinion.
Gary R. Jones, Danielle M. Vranian, BAXTER, BAKER, SIDLE, CONN &
JONES, P.A., Baltimore, Maryland, for Appellants. Charles M.
Asmar, John J. McKenna, Jr., ASMAR, SCHOR & MCKENNA, PLLC,
Washington, D.C., for Appellee.
Unpublished opinions are not binding precedent in this circuit.
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PER CURIAM:
Civista Health, Inc., and Civista Medical Center, Inc.,
(collectively “Civista”) appeal the district court’s order
granting summary judgment in favor of Gilbane Building Company
(“Gilbane”) and dismissing Gilbane as a named defendant prior to
the completion of any discovery. In its amended complaint,
Civista alleged breach of contract, negligence, breach of
express and implied warranties, and fraud/misrepresentation for
work related to a construction contract that Gilbane performed.
Gilbane moved for summary judgment on the ground that suit was
barred by the statute of limitations as determined by an accrual
clause contained in the contract. The district court agreed
that the accrual clause was valid, held that fraud as an
exception to its enforceability applied only to fraud in the
inducement of a contract, and granted Gilbane’s motion for
summary judgment, ruling that the claims against Gilbane were
barred by the statute of limitations. The court also denied
Civista’s Fed. R. Civ. P. 56(d) motion for discovery, concluding
that any additional evidence would be insufficient to create a
genuine issue of material fact.
On appeal, Civista argues that the district court erred in
concluding that the evidence was insufficient to establish
equitable estoppel of the statute of limitations, and that the
court erred in denying its Fed. R. Civ. P. 56(d) motion. With
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regard to Civista’s second claim, we have emphasized that,
“[g]enerally speaking, ‘summary judgment must be refused where
the nonmoving party has not had the opportunity to discover
information that is essential to his opposition.’” Harrods
Ltd. v. Sixty Internet Domain Names, 302 F.3d 214, 244 (4th Cir.
2002) (quoting Anderson v. Liberty Lobby, Inc., 477 U.S. 242,
250 n.5 (1986) (brackets omitted)). Reversal of the district
court’s denial of a Rule 56(d) motion is only appropriate where
there was “a clear abuse of discretion or . . . there is a real
possibility the party was prejudiced by the denial of” more time
for discovery. Ingle ex rel. Estate of Ingle v. Yelton, 439
F.3d 191, 195 (4th Cir. 2006) (internal quotation marks
omitted).
In the Rule 56(d) affidavit that Civista submitted to the
district court, Civista’s counsel stated that Civista’s
investigation “uncovered evidence of serious deficiencies in
Gilbane’s construction” of an addition to the medical center.
Civista asserted that it “wish[ed] to inquire into Gilbane’s
communications and interaction with its subcontractors and the
various inspectors who visited the construction site,” as well
as “Gilbane’s record of competence in performing its contractual
supervisory duties during construction and, in particular, how
violations as notorious [sic] as are described by the Fire
Marshall [sic] were either missed, ignored, or covered up.”
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Counsel’s affidavit asserts that Civista identified, on
account of the effects of an earthquake and hurricane that
impacted the hospital, significant defects in the construction
that Gilbane must have noticed, raising an inference that
Gilbane knew of the defects but intentionally failed to disclose
and correct the defects as it was contractually obligated to do.
The fact that Gilbane had previously identified many of these
issues and certified that they had been corrected, when serious
issues remained, supports an inference that Gilbane
intentionally concealed the deficiencies. Although this
suggestion of fraud is not strong, the evidence, while
insufficient standing alone to avoid summary judgment, is
sufficient to warrant further discovery. See Pearson v. First
NH Mortg. Corp., 200 F.3d 30, 35 n.2 (1st Cir. 1999) (“[i]n most
fraud cases, plaintiffs rarely obtain possession of the smoking
guns until a lawsuit is filed and discovery of the defendant’s
internal records becomes available” (internal quotation marks
and ellipses omitted)).
We disagree with the district court’s conclusion that the
requested discovery could not create a genuine issue of material
fact, as evidence of Gilbane’s knowledge of, and response to,
the construction deficiencies would directly bear on whether
Gilbane fraudulently concealed the deficiencies. If Gilbane did
engage in fraudulent concealment, such action may warrant
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equitable estoppel and prevent Gilbane from asserting a statute
of limitations defense in reliance on the accrual clause, rather
than the state’s discovery rule. See Poffenberger v. Risser,
431 A.2d 677, 680 (Md. 1981) (noting Maryland has applied
discovery rule “in a case involving faulty construction”).
Thus, the district court’s denial of Civista’s Rule 56(d) motion
created “a real possibility the party was prejudiced by the
denial of” more time for discovery, as Civista was left unable
to defend against Gilbane’s affirmative defense. Ingle, 439
F.3d at 195.
Accordingly, we vacate the district court’s grant of
judgment and remand for further proceedings consistent with this
opinion. We dispense with oral argument because the facts and
legal contentions are adequately presented in the materials
before this court and argument would not aid the decisional
process.
VACATED AND REMANDED
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