 |
 |
to fill out a simple form to connect to Personal Injury Lawyers in your area.
|
|
|
|
|
KELLY v. PRIMELINE ADVISORY2/3/1995
The opinion of the court was delivered by
This is a first impression statute of limitations case arising under K.S.A. 17-1268(a), the civil liabilities section of the Kansas
Securities Act (the Act), K.S.A. 17-1252 et seq. The district court concluded that the statutory claims of James and Ellen Kelly were barred by K.S.A. 60-512(2), a three-year statute of limitations. The paramount question is when a fraud-based K.S.A. 17-1268(a) action commences under K.S.A. 60-512(2) — upon discovery of the fraud or at the time of sale of the security.
The Kellys appeal the decision entered against them on defendants' motion for summary judgment. We apply a discovery rule to K.S.A. 60-512(2), reverse the summary judgment, and remand for further proceedings. Defendants Primeline Advisory, Inc., Primeline Securities Corp., Primeline Financial Group, Inc., Fred F. Liebau, Jr., James G. Woodall, and Bruce W. Bertsch cross-appeal, challenging the effect of various statements in the district court's order. Our jurisdiction is under K.S.A. 20-3018(c) (a transfer from Court of Appeals on our own motion). We will refer to all defendants as "Primeline," unless we are specifically discussing factual circumstances involving defendant Don Baxter. Baxter, who has separate counsel, has not filed a brief on appeal. His interests are identical to the other defendants.
Facts
The Kellys approached Baxter for investment advice and assistance in February 1986. Baxter, who advertised as a certified financial planner, worked for Primeline Advisory, Inc., a financial planning and investment services firm, and its sister corporation, Primeline Securities Corp., a registered broker-dealer of securities. The Kellys had read about Baxter in Money magazine. At the time the Kellys came to Baxter, their retirement money was in a CD. The Kellys' position is that they told Baxter they did not want risk; if they had wanted risk they would have invested in the stock market. They told him that they wanted to have something when they retired. They told him they had four children, they wanted all their children to go to college, and they could not afford to lose the money. The Kellys and Baxter, on behalf of Primeline Advisory, Inc., signed a letter of engagement on February 3, 1986. Baxter and Primeline Advisory, Inc., promised to "recommend and educate [the Kellys] about investments suitable
to [their] income tax, estate and family circumstances, liquidity needs, retirement goals, objectives and preferences and economic resources."
Over the next three years, Baxter recommended and the Kellys agreed to 21 different investments in various limited partnerships and other assorted securities. The first purchase occurred on March 2, 1986, the last on April 21, 1989. The Kellys invested a total of $172,941.25.
Heavy losses followed, as several limited partnerships went through bankruptcy . According to the Kellys, Baxter had persuaded them to invest in "high risk, high-commission limited partnerships and direct investments" without adequately informing them of the risks of each investment. The Kellys also contend Baxter did not adequately consider whether such high-risk investments were suited to their investment goals and portfolio. Baxter and Primeline argue the Kellys knew or should have known of the nature and risk of each investment because they received prospectuses or other offering documents at or near the time of each purchase.
The Kellys filed the instant action on January 8, 1993, seeking relief afforded under K.S.A. 17-1268(a). In addition, they sought damages and equitable relief through common-law claims of breach of fiduciary d
Page 1 2 3 4 5 6 7 8 9 10 Kansas Personal Injury Attorneys
Personal Injury Lawyers
|
| |
to fill out a simple form to connect to Personal Injury Lawyers in your area.
|
|