In Valdez v. Hollenbeck, parties attempted to sue an administrator for thefts from the estate by a third person around 1995 after the court had discharged the administrator in 1996. No. 13-0709, 2015 Tex. LEXIS 556 (Tex. June 12, 2015). The Texas Supreme Court held that all bills of review (statutory or equitable) from probate proceedings have a two-year statute of limitations under Texas Estates Code Section 55.251, which begins at the end of any tolling period. The Court recognized two doctrines that may delay accrual or toll limitations: (1) the discovery rule and (2) fraudulent concealment. The Court held that the discovery rule applies on a categorical basis to injuries that are both inherently undiscoverable and objectively verifiable. When applicable, the discovery rule defers the accrual of the cause of action until the injury was or could have been reasonably discovered. Unlike the discovery rule’s categorical approach, fraudulent concealment is a fact-specific equitable doctrine that tolls limitations until the fraud is discovered or could have been discovered with reasonable diligence. When a defendant is under a duty to make a disclosure but conceals the existence of a cause of action from the party to whom it belongs, the defendant is estopped from relying on the defense of limitations until the party learns of the right of action or should reasonably have discovered it. The estoppel effect of fraudulent concealment ends when a party learns of facts, conditions, or circumstances which would cause a reasonably prudent person to make inquiry, which, if pursued, would lead to the discovery of the concealed cause of action. Knowledge of such facts is in law equivalent to knowledge of the cause of action.
The Court held in this case that the claims accrued in 2003 when a receiver informed the beneficiaries that the estate had been undervalued due to misappropriations by a third party, and disclosed an amount therefore. “[T]he August 2003 report made clear that the assets on hand at Bernard’s death vastly exceeded the amounts stated in the March 1994 inventory. A half-million-dollar discrepancy is considerable and gives rise to a duty to make further inquiry.” Id. The Court entered judgment for the administrator and surety company due to the running of limitations.