Opinion
No. 53151-4-I
Filed: August 23, 2004 UNPUBLISHED OPINION
Appeal from Superior Court of King County. Docket No: 03-2-29769-1. Judgment or order under review. Date filed: 09/26/2003. Judge signing: Hon. James A. Doerty.
Counsel for Appellant(s), Linda Lidie Brain, Attorney at Law, 110 110th Ave NE Ste 670, Bellevue, WA 98004.
Counsel for Respondent(s), Brian William Esler, Miller Nash LLP, 601 Union St Ste 4400, Seattle, WA 98101.
James H. Jordan, Miller, Nash LLP, 601 Union St Ste 4400, Seattle, WA 98101-1367.
In cases involving real property, the failure to timely sue a person constitutes inexcusable neglect when the person's identity could have been discovered through a search of public records. Here, Valerie Gildon sought to add the owner of a shopping mall as a defendant after the statute of limitations for her claim had expired, and the record shows that she failed to search public records to determine the actual owner's identity. The trial court did not abuse its discretion when it denied Gildon's motion to amend because it would not relate back. Further, a trial court has no jurisdiction over a purported defendant not served with process. Here, Gildon did not serve process on the shopping mall's owner, a partnership, or name it as a defendant, and service on a general partner does not constitute effective service of process on the partnership. Thus, the trial court did not err by dismissing Gildon's case as against the mall's owner. However, Northgate Mall Partnership was not an indispensable party to Gildon's action. Therefore, the trial court erred in dismissing this action as against Simon Property Group, Inc.
FACTS
On June 28, 2000, Valerie Gildon allegedly slipped and fell on wet tiles in the common walkway at Northgate Mall. On June 24, 2003, Gildon and her husband (collectively, Gildon) sued Simon Property Group, Inc. (hereinafter, Simon) and several fictitiously-named defendants for personal injuries, based on negligence and premises liability theories. But Gildon did not name the mall's owner, Northgate Mall Partnership, as a defendant. In fact, Simon was merely one of two general partners that formed the Northgate Mall Partnership.
Simon moved to dismiss Gildon's suit under CR 12(b)(7) because she failed to sue the Partnership, which Simon argued was an indispensable party. Gildon did not file a direct opposition to Simon's motion to dismiss, but on August 7, 2003, she moved to amend her complaint to add the Partnership and Simon Property Group, L.P., the other general partner, as additional defendants. Simon opposed Gildon's motion on the ground that it would be futile to add the proposed additional defendants because, as to them, the statute of limitations had expired, and Gildon had not shown why the amendment should relate back to the date of her original complaint. The trial court denied Gildon's motion to amend because the statute of limitations barred the claims against the proposed additional defendants, and the amendment would not relate back. The court also granted Simon's motion to dismiss all of Gildon's claims because she failed to sue the Partnership, which the court found to be a necessary and indispensable party.
ANALYSIS
Both a denial of a motion to amend a pleading and a ruling on the relation back of an amendment are reviewed for abuse of discretion. For the addition of a new party to relate back, the moving party must prove four elements:
Herron v. Tribune Pub. Co., Inc., 108 Wn.2d 162, 165, 736 P.2d 249 (1987) (denial of motion to amend); Kommavongsa v. Haskell, 149 Wn.2d 288, 295, 67 P.3d 1068 (2003) (ruling on relation back).
(1) the amendment arose out of the same conduct, transaction, or occurrence set forth in the original pleading;
CR 15(c).
(2) the party to be added received actual notice of the lawsuit before the statute of limitations expired, so that the party would not be prejudiced by having to defend on the merits;
CR 15(c).
(3) the party to be added knew or should have known that, but for a mistake concerning the identity of the proper party, it would have been sued; and
CR 15(c).
(4) the movant's failure to timely name the party to be added was not because of inexcusable neglect, or a conscious decision, strategy, or tactic.
North St. Ass'n v. Olympia, 96 Wn.2d 359, 368-69, 635 P.2d 721 (1981), overruled on other grounds by Sidis v. Brodie/Dohrmann, Inc., 117 Wn.2d 325, 815 P.2d 781 (1991).
Here, there can be no serious dispute as to the first three elements: Simon admits that Gildon's motion to add the Partnership arose out of the same conduct or occurrence set forth in her original complaint; the Partnership received notice of the suit before the statute of limitations expired because Simon, a general partner, received service of Gildon's summons and complaint; and because Simon knew that the Partnership actually owned the mall, and Simon knew that Gildon sought to make the owner liable, the Partnership (again, through Simon, its general partner) knew or should have known that but for Gildon's mistake, it would have been named as a defendant.
See RCW 25.05.010(6) (a partner's knowledge, notice, or receipt of notification of a fact relating to the partnership is effective immediately as knowledge, notice, or receipt of notification by the partnership, subject to an exception).
There is a serious dispute, however, about whether Gildon's failure to timely sue the Partnership was the product of excusable or inexcusable neglect.
In cases involving real property, it is inexcusable neglect not to name a party whose identity could have been discovered through a search of public records. Thus, in South Hollywood Hills, the moving party's neglect was held to be inexcusable because it failed to check the county property records; had it done so, `the proper parties would have been immediately evident.' And in Iwai, the fact that the movant had been misled by another party about a property's true owner had no bearing on her inexcusable neglect in failing to check public records. Gildon argues that she tried to discover the identity of the mall's owner by methods other than a public records search, but that several agents of the owner misled her about the owner's actual identity. But as Iwai made clear, due diligence is irrelevant to the issue of inexcusable neglect in cases involving real property. Had Gildon performed a title search on the property, she would have discovered that the Partnership, not Simon, was the mall's owner. She neglected to do this, however.
Tellinghuisen v. King County Council, 103 Wn.2d 221, 224, 691 P.2d 575 (1984); South Hollywood Hills Citizens Ass'n v. King County, 101 Wn.2d 68, 78, 677 P.2d 114 (1984); Iwai v. State, 76 Wn. App. 308, 314, 884 P.2d 936 (1994); City of Federal Way v. King County, 62 Wn. App. 530, 540, 815 P.2d 790 (1991).
South Hollywood Hills, 101 Wn.2d at 78.
Iwai, 76 Wn. App. at 314 n. 5, 315 n. 6.
The trial court did not abuse its discretion when it found that Gildon's proposed amendment would not relate back, and when it denied Gildon's motion to amend.
As to the motion to dismiss, Gildon appears to raise two issues. She first argues that dismissal was improper because her lawsuit against Simon, as a general partner, was `also effective as filed and served against the partnership.' To support this argument, Gildon cites RCW 25.05.010(6), which imputes to a partnership one partner's knowledge or notice of a fact. In addition, she cites RCW 25.05.120(1), which makes a partnership liable for a partner's actionable conduct under certain circumstances, and RCW 25.05.130(2), which provides that a lawsuit `may be brought against the partnership and . . . any . . . partner.'
The statutes do not support her argument, however. While RCW 25.05.010(6) arguably imputed to the Partnership knowledge of the fact that a suit had been filed and served against Simon, because the Partnership was not named as a defendant, service on Simon did not impute effective service of process on the Partnership.
Of course, had Gildon timely named the Partnership as a defendant, service on Simon would have been effective as service on the Partnership. RCW 4.28.080(10).
Likewise, the other statutes do not aid Gildon because they presume the fact that the Partnership had been named as a defendant. If Gildon had sued the Partnership, it clearly could have been held liable for Simon's actionable conduct while it was acting in the ordinary course of business of the Partnership or with the Partnership's authority. But because Gildon failed to name or add the Partnership as a defendant, she cannot now make the Partnership a party under RCW 25.05.120.
See RCW 25.05.120(1).
Gildon's suit cannot proceed against the Partnership because the trial court never acquired jurisdiction over the Partnership. Thus, even if the court allows her suit to proceed against Simon, the Partnership could never be held liable directly or vicariously for the claims she alleges in her complaint.
Finally, Gildon argues that her suit against Simon should have been allowed to proceed even in the absence of the Partnership. On this issue, she is correct. Under CR 19(b), even where it is not feasible to join a party, the trial court must determine `whether in equity and good conscience the action should proceed among the parties before it, or should be dismissed, the absent person being thus regarded as indispensable.' The factors the court should consider as to indispensability include:
(1) to what extent a judgment rendered in the person's absence might be prejudicial to him or those already parties;
(2) the extent to which, by protective provisions in the judgment, by the shaping of relief, or other measures, the prejudice can be lessened or avoided;
(3) whether a judgment rendered in the person's absence will be adequate; [and]
(4) whether the plaintiff will have an adequate remedy if the action is dismissed for nonjoinder.
CR 19(b).
Here, the expired statute of limitations made it not feasible indeed, futile to join the Partnership. But the record does not indicate what factors, if any, the trial court considered before it found that the Partnership was indispensable. Regardless of what these factors were, however, the trial court plainly abused its discretion by declaring the Partnership to be indispensable.
Inexplicably, both the parties and the trial court seemed to treat Simon's motion to dismiss as if its potential liability could only have been premised on its ownership of the mall. That is not the case. The complaint obviously alleges a number of negligence claims against Simon in a variety of other capacities: operator, manager, occupier, lessee or lessor, sublessee or sublessor, builder, repairer, designer, controller, possessor, maintainer, and instructor. These claims raise bases of liability that depend not at all on the Partnership's presence in the case. If the trial court had considered the factors in CR 19(b) in a reasonable manner, it would have found that:
(1) because the statute of limitations had expired as against the Partnership, no judgment could be rendered against it and no judgment could prejudice it;
(2) a judgment against Simon would likely compensate Gildon adequately; and
(3) Gildon would have no other remedy to pursue if her suit against Simon were dismissed.
Because the trial court's finding of indispensability was manifestly unreasonable, the trial court's dismissal of Gildon's suit under CR 12(b)(7) was an abuse of discretion. The court should allow the suit to proceed against Simon.
We affirm the trial court's order denying motion to amend complaint, but reverse the dismissal of the claim against Simon Properties, Inc.
GROSSE, BECKER and AGID, concur.
I agree with the result the majority reaches. But I do not agree that the trial court acted `unreasonably' when it dismissed the lawsuit against Simon. As the majority acknowledges, both parties assumed liability must be premised on property ownership (Majority at 7). Thus, while the trial court erred in agreeing with them, its decision was not `manifestly unreasonable.' (Majority at 8).