State Ex Rel. Equity Supply Co. V.

No, 12214

I N THE SUPREME C U T O THE STATE O M N A A OR F F OTN

STATE O M N A A e x r e l , EQUITY SUPPLY COMPANY, F OTN Petitioner,

THE DISTRICT C U T O THE ELEVENTH JUDICIAL DISTRICT OF OR F THE STATE O MONTANA, i n and f o r t h e County of F l a t h e a d F and t h e Honorable Robert S. K e l l e r , a Judge t h e r e o f , Respondents.

ORIGINAL PROCEEDING:

Counsel of Record For P e t i t i o n e r : Korn,Warden,Walterskirchen & C h r i s t i a n s e n ,Kalispe11 M e r r i t t Warden argued, K a l i s p e l l , Montana.

For Respondents: McGarvey, Morrison and Hedman, Whitefish, Montana. Frank B Morrison argued, Whitefish, Montana.

Submitted: February 25, 1972 Decided: - MAR 9 1972

M r . J u s t i c e Wesley C a s t l e s d e l i v e r e d t h e Opinion of t h e Court.

This i s an o r i g i n a l proceeding i n which r e l a t o r Equity Supply Company seeks a w r i t of s u p e r v i s o r y c o n t r o l d i r e c t e d t o t h e d i s t r i c t c o u r t of t h e e l e v e n t h j u d i c i a l d i s t r i c t , F l a t -head County, Hon. Robert S. K e l l e r p r e s i d i n g .

R e l a t o r i s one o f t h e defendants named i n Cause No. 21,801 i n Flathead County f i l e d March 2 2 , 1971, e n t i t l e d Edward Pagel and Leona Pagel, P l a i n t i f f s v s . P h i l l i p Barr and Equity Supply Company, Defendants, wherein p l a i n t i f f s seek damages f o r p e r s o n a l i n j u r i e s a r i s i n g o u t of a motor v e h i c l e c o l l i s i o n on January 31, 1964, i n Lincoln County. Defendant, P h i l l i p B a r r , has never been served w i t h process and has n o t appeared i n t h e action. Barr was a l l e g e d l y t h e d r i v e r of a motor v e h i c l e owned by Equity Supply Company.

A p r i o r i d e n t i c a l a c t i o n , Cause No. 18,685 i n t h e same c o u r t i n Flathead County, was f i l e d on January 27, 1967, No

summons was i s s u e d on t h e complaint i n t h a t a c t i o n . O March 3 , n

1969, a n amended complaint was f i l e d seeking i d e n t i c a l damages. On t h a t d a t e summons was i s s u e d and served on t h e d e f e n d a n t , r e l a t o r h e r e i n , on March 4 , 1969, over f i v e y e a r s a f t e r t h e a c c i -dent.

On A p r i l 3 , 1969, defendant Equity Supply Company appeared by motion t o quash summons and t o d i s m i s s t h e a c t i o n , pursuant to Rule 4 1 ( e ) , M.R.Civ.P. B r i e f s were f i l e d and on March 15, 1971, t h e p r e s i d i n g judge g r a n t e d t h e motion f o r t h e reason t h a t summons was n o t i s s u e d w i t h i n one year of t h e d a t e of commencement of t h e a c t i o n . The d i s t r i c t judge wrote t h e following memorandum w i t h h i s o r d e r :

"Section 93-4705 (7) , RCM, 1947, s p e c i f i c a l l y provided f o r t h e d i s m i s s a l of a c t i o n s wherein summons had n o t been i s s u e d w i t h i n one y e a r . This s t a t u t e was repealed i n 1961, c o n c u r r e n t l y w i t h t h e a d o p t i o n of t h e Rules of C i v i l Procedure. Rule 4 1 ( e ) , which has no c o u n t e r p a r t i n t h e F e d e r a l Rules, was adopted i n 1963, and i t pro- vided t h a t u n l e s s summons s h a l l have been served and r e t u r n made w i t h i n t h r e e y e a r s a f t e r commence- ment of t h e a c t i o n , t h e a c t i o n should be dismissed. Rule 41(e) was a g a i n amended i n 1965, but t h e 1963 r u l e came o u t of t h e old S e c t i o n 93-4705. That s t a t u t e n o t only provided f o r a d i s m i s s a l i f summons had n o t been i s s u e d w i t h i n one y e a r , but i t a l s o provided f o r a d i s m i s s a l i f s e r v i c e and r e t u r n of summons had n o t been made w i t h i n t h r e e y e a r s , a s Rule 4 1 ( e ) , i n i t s 1963 v e r s i o n attempted t o s t a t e . Rule 4 1 ( e ) , a s amended i n 1965, i s , f o r t h e p a r t t h a t i s r e l e v a n t t o t h i s motion, t a k e n almost d i r e c t l y from S e c t i o n 93-4705.

"Section 93-3002, RCM, 1947, s p e c i f i c a l l y provided t h a t p l a i n t i f f may have summons i s s u e d w i t h i n one y e a r a f t e r t h e f i l i n g of t h e complaint. T h i s s t a t u t e was n o t r e p e a l e d when t h e r u l e s were adopted and i n f a c t has never been r e p e a l e d a s such, but was superseded by Rule 41(e) a s amended by Supreme Court Order 10750. Rule 4 1 ( e ) , i n i t s 1963 v e r s i o n , was amended t o i t s p r e s e n t v e r s i o n by Supreme Court Order 10750, i . e . , t h e p r e s e n t Rule 41(e) supersedes S e c t i o n 93-3002, and based upon t h e commission n o t e t o t h e 1965 amendment, i t a l s o i n c o r p o r a t e s S e c t i o n 93-4705(7), RCM, 1947, now r e p e a l e d , 1I It i s now c l e a r t h a t a l l a c t i o n s now commenced s h a l l be dismissed by t h e Court:

"1. Unless summons s h a l l have been i s s u e d w i t h i n one y e a r , o r ,

"2. Unless summons i s s u e d w i t h i n one y e a r s h a l l have been s e r v e d and r e t u r n made and f i l e d w i t h t h e C l e r k w i t h i n t h r e e y e a r s a f t e r t h e com- mencement of t h e a c t i o n , o r ,

"3. Unless appearance has been made by t h e defendant t h e r e i n w i t h i n s a i d t h r e e y e a r s .

"The complaint i n t h i s a c t i o n was f i l e d on January 27, 1967, and i f a summons were then i s s u e d , i t has n o t been r e t u r n e d , i n s o f a r a s t h e f i l e r e f l e c t s . An amended complaint was f i l e d on March 3 , 1969, and a summons was then i s s u e d on t h e amended complaint. This was improper. N summons can i s s u e w i t h i n one o y e a r a f t e r t h e f i l i n g of t h e complaint, and t h e amended complaint would r e l a t e back t o t h e d a t e o f t h e f i l i n g of t h e o r i g i n a l complaint."

During t h e seven y e a r p e r i o d , d i f f e r e n t c o u n s e l appeared both a s t o t h e o r i g i n a l complaint and t h e amended complaint. Following t h e d i s m i s s a l of Cause 18,685 on March 15, 1971, a n o t h e r new counsel appeared and on March 22, 1971, a complaint was f i l e d a s a new a c t i o n , but i d e n t i c a l i n a l l ways t o t h e p r e v i o u s l y dismissed a c t i o n . A f t e r s e r v i c e of process on r e l a t o r a s one of t h e d e f e n d a n t s , r e l a t o r f i l e d i t s answer s e t t i n g f o r t h a s a f f i r m a t i v e defenses s e c t i o n 93-2605, R.C .M. 1947, ( t h e t h r e e y e a r s t a t u t e of l i m i t a t i o n s ) , and r e s j u d i c a t a by reason o f t h e d i s m i s s a l of Cause No. 18,685. A t t h e same time, r e l a t o r f i l e d a motion f o r summary judgment a s t o t h e i s s u e of l i a b i l i t y by reason of t h e a f f i r m a t i v e d e f e n s e s .

O January 12, 1972, Judge K e l l e r denied t h e motion f o r n

summary judgment. Again, a s i n t h e previous c a s e , Judge K e l l e r wrote a memorandum:

"Whitcraft v s . Semenza, 1965, 145 Mont. 94, 97, 399 Pac 2d. 757, i s a c a s e d i r e c t l y i n p o i n t , and i t c l e a r l y holds t h a t a d i s m i s s a l under t h e p r o v i - s i o n s o f Rule 4 1 ( e ) i s n o t r e s j u d i c a t a , does n o t c o n s t i t u t e a bar t o a n o t h e r s u i t on t h e same c l a i m , and i s n o t a d i s m i s s a l upon t h e m e r i t s .

" P l a i n t i f f r e l i e s upon t h e p r o v i s i o n s of S e c t i o n 93-2708, RCM, 1947, t o avoid t h e s t a t u t e of l i m i t a - t i o n s , which o r d i n a r i l y would have run i n t h i s c a s e . Defendant t a k e s t h e p o s i t i o n t h a t t h a t s t a t u t e i s n o t a p p l i c a b l e i n t h i s c a s e s i n c e t h e previous d i s - m i s s a l of t h i s c a s e under t h e p r o v i s i o n s o f Rule 4 1 ( e ) c o n s t i t u t e d a d i s m i s s a l of t h e complaint f o r n e g l e c t t o p r o s e c u t e t h e a c t i o n . C i t e d c a s e s , and l e g a l a u t h o r i t i e s , a r e d i v i d e d on t h e q u e s t i o n of whether o r n o t t h e f a i l u r e t o i s s u e summons i s a n e g l e c t t o p r o s e c u t e t h e a c t i o n . S u f f i c e i t t o s a y t h a t Rule 41(b) provides t h a t a f a i l u r e t o p r o s e c u t e t h e a c t i o n o p e r a t e s a s a n a d j u d i c a t i o n upon t h e m e r i t s , and then provides f o r Rule 41(e) which i s a d i s m i s s a l f o r f a i l u r e t o s e r v e a summons, i . e . , t h e l a t t e r cannot be a n e g l e c t t o p r o s e c u t e t h e a c t i o n . 11

The two memorandums of t h e t r i a l judge a c t u a l l y s e t f o r t h t h e problem presented h e r e . This Court g r a n t e d a n ex p a r t e a l -t e r n a t i v e o r d e r t o show cause. Return was made, b r i e f s f i l e d and t h e m a t t e r f u l l y argued.

ela at or 's p o s i t i o n i s t h a t t h e d i s m i s s a l of Cause No. 18,685 under Rule 4 1 ( e ) , M.R.Civ.P., f o r f a i l u r e t o have summons i s s u e d w i t h i n one y e a r c o n s t i t u t e d "a d i s m i s s a l of t h e complaint f o r n e g l e c t t o p r o s e c u t e t h e a c t i o n " and t h e r e f o r e p l a i n t i f f s were n o t e n t i t l e d t o t h e e x t e n s i o n of l i m i t a t i o n s provided f o r i n s e c t i o n 93-2708, R.C.M. 1947. This being t h e c a s e , r e l a t o r r e a s o n s , t h e t h r e e y e a r s t a t u t e of l i m i t a t i o n s provided f o r i n s e c t i o n 93-2605, R.C.M. 1947, i s a p p l i c a b l e t o Cause No. 21,801 and t h e motion f o r summary judgment should have been g r a n t e d . Relator a l s o urges t h a t t h e e f f e c t of t h e d i s m i s s a l of Cause No. 18,685 f o r f a i l u r e t o have t h e summons i s s u e d w i t h i n one y e a r was a d i s m i s s a l f o r f a i l u r e t o p r o s e c u t e and o p e r a t e s a s a n a d j u d i c a -t i o n upon t h e m e r i t s and i s thus r e s j u d i c a t a .

P l a i n t i f f s below r e l y on s e c t i o n 93-2708, R.C,M. 1947,

which provides : II P r o v i s i o n where judgment has been r e v e r s e d . I f a n a c t i o n i s commenced w i t h i n t h e time l i m i t e d t h e r e f o r , and a judgment t h e r e i n i s r e v e r s e d on a p p e a l , without awarding a new t r i a l , o r t h e a c t i o n is terminated i n any o t h e r manner than by a voluntary discontinuance, a dismissal of t h e complaint f o r n e g l e c t t o p r o s e c u t e t h e a c t i o n , o r a f i n a l judgment upon t h e m e r i t s , t h e p l a i n t i f f , o r , i f he d i e s , and t h e cause of a c t i o n s u r v i v e s , h i s r e p r e s e n t a t i v e , may commence a new a c t i o n f o r t h e same c a u s e , a f t e r t h e e x p i r a t i o n o f t h e time s o l i m i t e d , and w i t h i n one y e a r a f t e r such a r e v e r s a l o r t e r m i n a t i o n . 1I

P l a i n t i f f s a r g u e t h a t s e c t i o n 93-2708 i s a "saving s t a t u t e " enabling p l a i n t i f f s t o r e f i l e even though t h e s t a t u t e of l i m i t a t i o n s had run and t h e f i r s t c a s e had been dismissed f o r f a i l u r e t o have a summons i s s u e d w i t h i n one y e a r . Plaintiffs go on t o a r g u e t h a t t h e only way a d i s m i s s a l under Rule 4 1 ( e ) , M.R.Civ.P., could be a n a d j u d i c a t i o n upon t h e m e r i t s would be i f Rule 41(e) i s contemplated i n t h e language of Rule 41(b) a s a ' ' f a i l u r e t o prosecute".

A s noted i n t h e second memorandum of Judge K e l l e r , t h e c a s e o f W h i t c r a f t v. Semenza, 145 Mont. 94, 96, 399 P.2d 757, c o n t a i n s language concerned h e r e . Also, a s noted i n Judge ~ e l l e r ' smemorandums, t h e h i s t o r y of Rule 41, M.R.Civ.P., is involved. I n S t a t e ex r e l . Baldwin v. D i s t r i c t Court, 142 Mont. 64, 68, 381 P.2d 473, decided i n 1963 p r i o r t o t h e amendment i n

1965 of Rule 4 1 ( e ) , t h i s Court h e l d t h a t where a summons i s s u e d w s a on May 23, 1958, b u t l n o t served u n t i l December 20, 1962, s e c t i o n

93-4705, R.C.M. 1947, operated s o a s t o p l a c e a l i m i t a t i o n of t h r e e y e a r s on s e r v i c e o f summons f o r a l l purposes.

I n a somewhat p a r a l l e l s i t u a t i o n a s h e r e involved, t h e Court i n Baldwin s a i d :

"The a f f i d a v i t f i l e d by t h e p l a i n t i f f adminis- t r a t o r i n t h e d i s t r i c t c o u r t i n d i c a t e s changes of counsel and a p p a r e n t l a c k of d i l i g e n c e i n e f f e c t i n g t h e s e r v i c e by counsel. These m a t t e r s a r e u n f o r t u n a t e , p a r t i c u l a r l y h e r e where t h e s t a t u t e o f l i m i t a t i o n s has run a g a i n s t t h e c l a i m f o r r e l i e f , but t h e r e a r e two s i d e s i n a l l l i t i g a - t i o n . Here t h e wreck occurred December 17, 1956. O December 20, 1962, t h e defendant was served w i t h n process c a l l i n g upon him t o defend an a c t i o n f o r damages which had occurred s i x y e a r s and t h r e e days p r e v i o u s l y . Such d e l a y i n p r o s e c u t i o n should n o t be t o l e r a t e d , and i s n o t under our law. Whether o r n o t a c t i o n s o f c o u n s e l s e l e c t e d by t h e p l a i n t i f f - a d m i n i s t r a t o r c a n ' b e excused o r condoned i s n o t b e f o r e us i n t h i s proceeding."

Fallowing Baldwin, W h i t c r a f t was decided on March 5 , 1965. Rule 41(e) was amended t h e r e a f t e r and t h e Commission n o t e r e a d s a s follows:

"This c l a r i f i e s and brings t o g e t h e r t h e l a c h e s p r o v i s i o n s w i t h r e s p e c t t o i s s u a n c e and s e r v i c e of summons. A t p r e s e n t Rules 4 C ( l ) , 4 1 ( e ) , S e c t i o n 93-3002, R.C.M. 1947, and Rule 12(b) a l l need t o be r e f e r r e d t o . This amendment i n - c o r p o r a t e s t h e l a c h e s p r o v i s i o n o f S e c t i o n 93- 4705(7), R.C.M. 1947, which was r e p e a l e d by Chapter 13 of t h e 1961 Session Laws.

"This amendment r e n d e r s S e c t i o n 93-3002, R.C .M. 1947, unnecessary, and t h a t s e c t i o n superseded and added t o Tables B and C."

I n W h i t c r a f t t h e Court h e l d t h a t t h e r a i s i n g of f a i l u r e t o s e r v e summons w i t h i n t h r e e y e a r s a f t e r i s s u a n c e could be by motion r a t h e r than pleaded; and t h a t t h e f a i l u r e t o s e r v e t h e summons w i t h i n t h r e e y e a r s could be r a i s e d a s a bar even though s e c t i o n 93-4705, R.C.M. 1947, had been r e p e a l e d ; and even though Rule 41(e) had n o t been adopted t o cover t h e s i t u a t i o n p r e s e n t e d . I n W h i t c r a f t t h e following language appears :

"It must be borne i n mind t h a t t h e Rule i s n o t h i n g more than a r u l e of procedure, de- signed t o encourage promptness i n t h e prose- c u t i o n of a c t i o n s . Dismissal thereunder i s n o t based upon t h e absence of a c l a i m , nor upon any d e f e c t i n t h e s u b s t a n t i v e r i g h t , nor i s t h e Rule a s t a t u t e of l i m i t a t i o n b a r r i n g t h e c l a i m a f t e r l a p s e of t h e s p e c i f i e d time. While a n a c t i o n may be dismissed t h e c l a i m remains. An o r d e r o f d i s m i s s a l i s n o t r e s j u d i c a t a , i t does n o t c o n s t i t u t e a bar t o a n o t h e r s u i t on t h e same claim. It i s a funda- mental r u l e t h a t a judgment i s n o t r e s j u d i c a t a u n l e s s it i s on t h e m e r i t s , and a d i s m i s s a l under t h e Rule i s n o t . "

This language makes Judge ~ e l l e's f e e l i n g o f o b l i g a t i o n under- r

standable. However, i n t h e c o n t e x t i n which i t was used, a s a

prelude t o t h e d i s c u s s i o n of ~ h e t h e .Rble 4 1 ( e ) was then t o be r

used r e t r o s p e c t i v e l y a s contended by t h e a p p e l l a n t i n W h i t c r a f t , t h e language i s l i m i t e d t o t h a t c o n t e x t .

A s Rule 41(e) i s now w r i t t e n , a n o r d e r of d i s m i s s a l i s a bar t o a n o t h e r s u i t on t h e same c l a i m , i f , a s h e r e , t h e s t a t u t e of l i m i t a t i o n s a s w e l l a s t h e period provided f o r by t h e r u l e , have run. S e c t i o n 93-2708, R.C.M. 1947, a s quoted p r e v i o u s l y , has been l i m i t e d t o t h a t e x t e n t by t h e a p p l i c a t i o n o f Rule 41. A s we s a i d i n t h e above quoted p o r t i o n o f Baldwin, such d e l a y i n p r o s e c u t i o n should n o t be t o l e r a t e d , and i s n o t under our law. Rule 41(e) i s e x p l i c i t and i n c o r p o r a t e s t h e l a c h e s p r o v i s i o n s p r e v i o u s l y contained i n s e c t z o n 93-470>(7), R.C .M. 1947. Any o t h e r i n t e r p r e t a t i o n would make Rule 41, M.R.Civ.P., and i t s s u b d i v i s i o n s meaningless and they would simply become t e c h n i c a l d e f e c t s which could be e n d l e s s l y c o r r e c t e d upon being c a l l e d t o t h e a t t e n t i o n o f t h e Court.

Having found t h a t s e c t i o n 93-2708, R.C.M. 1947, does n o t o p e r a t e t o s a v e a c l a i m where t h e f a i l u r e t o have summons issued within t h e s t a t u t o r y period o f l i m i t a t i o n s had o c c u r r e d , i t then follows t h a t t h e o r d e r of t h e d i s t r i c t c o u r t should be r e v e r s e d and t h e c a s e dismissed.

It i s s o ordered.

"7 ,c # -r--%l~'-,-,-,,,,-,-------

Associate J u s t i c e

Associate J u s t i c e s . M r . J u s t i c e Frank I. Haswell, s p e c i a l l y c o n c u r r i n g .

I concur i n t h e r e s u l t reached by t h e m a j o r i t y , b u t d i s a g r e e w i t h i t s i n t e r p r e t a t i o n of Rule 4 1 ( e ) , M.R.Civ.P.

The m a j o r i t y h o l d s t h a t a n o r d e r of d i s m i s s a l i s a bar t o a n o t h e r s u i t by t h e same p a r t i e s on t h e same c l a i m only i f t h e s t a t u t e o f l i m i t a t i o n s , a s w e l l a s t h e p e r i o d

provided i n Rule 4 1 ( e ) , h a s run. I n m view, a d i s m i s s a l y

under Rule 4 1 ( e ) o p e r a t e s independently of any s t a t u t e o f l i m i t a t i o n s , and a d i s m i s s a l t h e r e u n d e r f o r f a i l u r e t o have a summons i s s u e d w i t h i n one y e a r b a r s a subsequent a c t i o n between t h e same p a r t i e s on t h e same c l a i m .

The o p e r a t i v e words of Rule 4 1 ( e ) t h a t a r e p e r t i n e n t h e r e provide:

'I* * * all actions heretofore or hereafter commenced s h a l l be d i s m i s s e d by t h e c o u r t i n which t h e same s h a l l have been commenced *** u n l e s s summons s h a l l have been i s s u e d w i t h i n one y e a r * * *." The purpose of t h i s Rule i s n o t o n l y t o promote d i l i g e n t

p r o s e c u t i o n of c l a i m s once s u i t has been f i l e d t h e r e o n , a l s o t o bar f u r t h e r prosecution of lached lawsuits. The Commission Note t o amended Rule 41(e) makes t h i s c l e a r i n t h e f o l l o w i n g language, quoted i n p a r t a s f o l l o w s :

"This c l a r i f i e s and b r i n g s t o g e t h e r t h e l a c h e s p r o v i s i o n s w i t h r e s p e c t t o i s s u a n c e and s e r v i c e of summons * * *. T h i s amendment i n c o r p o r a t e s t h e l a c h e s p r o v i s i o n s of S e c t i o n 93-4705 (7) , R . C.M. 1947, which was r e p e a l e d by Chapter 1 3 o f t h e 1961 S e s s i o n Laws * * *." (Emphasis added)

T h i s purpose i s completely d e f e a t e d by i n t e r p r e t i n g Rule 4 1 ( e ) , M.R.Civ.P. , t o permit a subsequent r e f i l i n g o f a l a c h e d l a w s u i t p r e v i o u s l y d i s m i s s e d s o long a s t h e s t a t u t e of l i m i t a t i o n s has n o t e x p i r e d . A c c o r d i n g l y , I would d i r e c t l y o v e r r u l e t h e language quoted i n t h e m a j o r i t y o p i n i o n from W h i t c r a f t v. Semenza, 145 Mont. 94, 399 P.2d 757, decided p r i o r t o t h e amendment of Rule 4 1 (e) , which I b e l i e v e t o be a t v a r i a n c e w i t h t h e purpose and express language of amended Rule 41 (e) , M.R.Civ. P.

O t h e foregoing b a s i s , I would hold t h a t Judge ~ e l l e 's n r

o r d e r of March 15, 1971, d i s m i s s i n g t h e o r i g i n a l s u i t f o r t a i l u r e t o have summons i s s u e d w i t h i n one year ended f u r t h e r prosecution of t h e same c l a i m i r r e s p e c t i v e of t h e s t a t u t e of limitations.

Associate J u s t i c e .