Baxter

INTRODUCTION

Defendant and appellant Gail Peterson appeals from a judgment in favor of plaintiff and respondent Harold Baxter. Baxter claimed that he and Peterson entered into an oral agreement, pursuant to which Baxter would lease a house from Peterson for two years and renovate the house at his own expense. In return, Baxter would have the option to buy the house from Peterson at the end of the lease period. Baxter performed, but Peterson refused to sell Baxter the house when he attempted to exercise the option.

Baxter sued for fraud, alleging that Peterson made the promise with no intent to perform it. Peterson denied the allegations and asserted that Baxter’s claim was barred by the statute of limitations because Baxter was on inquiry notice of her alleged wrongdoing more than three years (the period of limitations) prior to his filing the action. The jury returned a general verdict, finding Peterson liable for fraud and awarding Baxter compensatory damages of $250,000. After additional deliberation, the jury also awarded Baxter punitive damages of $75,000.

The jury’s general verdict necessarily implied a finding that Baxter’s claim was not barred by the statute of…