News World Communications, Inc. v. Thompsen
33 Media L. Rep. (BNA) 2166, 2005 D.C. App. LEXIS 380, 878 A.2d 1218 (2005)
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Rule of Law:
The statute of limitations for a claim of unjust enrichment begins to run when the plaintiff has rendered their final service and has been informed by the defendant that compensation will be wrongfully withheld, not when the defendant ultimately makes use of the benefit conferred.
Facts:
- In September 1994, Elaine J.S. Thompsen pitched an idea for a family magazine supplement to a reporter for News World Communications, Inc. (the Times).
- After being put in touch with an executive, Michael Mahr, and at his encouragement, Thompsen submitted a formal proposal, layouts for a 'Family Times' and 'Kids Times,' and a marketing strategy between November and December 1994.
- Mahr expressed strong interest, suggested potential compensation of $100,000 for the idea, and assured Thompsen in early 1995 that the project was 'all going to happen.'
- On April 4, 1995, Mahr telephoned Thompsen and stated that while a family magazine was being developed, her ideas were not novel and she would not be paid for her work.
- In June 1997, more than two years later, the Times published the first edition of a weekly supplement titled the 'Family Times.'
Procedural Posture:
- On July 22, 1998, Elaine J.S. Thompsen filed a five-count complaint against News World Communications, Inc. (the Times) in the trial court.
- The Times moved to dismiss all claims as barred by the three-year statute of limitations.
- The trial court dismissed Thompsen's contract-based claims as time-barred but denied the motion to dismiss the unjust enrichment claim, ruling it did not accrue until the Times published its magazine in June 1997.
- After Thompsen filed an amended complaint, the Times' subsequent motion for summary judgment on the same statute of limitations grounds was denied.
- The case proceeded to a jury trial, where the unjust enrichment claim was submitted to the jury.
- The jury returned a verdict in favor of Thompsen for $100,000, and the trial court entered judgment on the verdict.
- The Times filed a post-trial motion for Judgment as a Matter of Law, reasserting its statute of limitations defense, which the trial court denied.
- The Times (appellant) appealed the judgment to the District of Columbia Court of Appeals, with Thompsen as the appellee.
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Issue:
In an unjust enrichment claim, does the three-year statute of limitations begin to run when the plaintiff renders their final service and is refused payment, even if the defendant has not yet fully utilized the benefit conferred?
Opinions:
Majority - Schwelb, J.
Yes. The statute of limitations for an unjust enrichment claim accrues when the plaintiff renders their final service and is refused payment. The court reasoned that the core of an unjust enrichment claim is not the plaintiff's expectation of payment or the defendant's eventual use of a benefit, but rather the defendant's unjust retention of that benefit. The 'wrongful act' giving rise to the duty of restitution occurred on April 4, 1995, when the Times, having received the benefit of Thompsen's induced labor and ideas, informed her she would not be paid. At that moment, all elements of the claim were present: a benefit was conferred, the defendant retained it, and retention became unjust upon the refusal to pay. Therefore, Thompsen's lawsuit, filed on July 22, 1998, was outside the three-year statute of limitations which expired on April 4, 1998.
Analysis:
This decision establishes a clear and early trigger for the statute of limitations in unjust enrichment cases in the District of Columbia. By adopting the 'last rendition of services' test, the court aligns D.C. law with other jurisdictions and prioritizes the moment of the wrongful act (refusal to pay) over the defendant's subsequent actions (using the benefit). This precedent compels potential plaintiffs to act promptly after being denied compensation for services rendered. It prevents plaintiffs from waiting indefinitely to see if their work is eventually used, thereby promoting finality and preventing stale claims.
