Opinion
112,111.
07-24-2015
ZAFER CHIROPRACTIC & SPORTS INJURIES, P.A., Appellant, v. STATE FARM FIRE & CASUALTY INSURANCE COMPANY, Appellee.
Paul Hasty, Jr., and Kathryn M. O'Shea, of Hasty & Associates, LLC, of Overland Park, for appellant. Brette S. Hart and Matthew W. Greenberg, of Harris & Hart, L.L.C., of Leawood, for appellee.
Paul Hasty, Jr., and Kathryn M. O'Shea, of Hasty & Associates, LLC, of Overland Park, for appellant.
Brette S. Hart and Matthew W. Greenberg, of Harris & Hart, L.L.C., of Leawood, for appellee.
Before MALONE, C.J., PIERRON and ATCHESON, JJ.
MEMORANDUM OPINION
PER CURIAM.
Plaintiff Zafer Chiropractic & Sports Injuries, P.A., took assignments from three of its patients for Personal Injury Protection (PIP) benefits ostensibly due them from Defendant State Farm Fire & Casualty Insurance Company and then filed limited actions in Johnson County District Court to obtain those benefits. The district court granted State Farm's motion for summary judgment on the grounds the actions were barred by the statute of limitations, an affirmative defense on which the insurance company would have borne the burden of proof at trial. Zafer Chiropractic has appealed. Because the summary judgment record contains insufficient facts to establish the defense, the district court erred. We, therefore, reverse and remand for further proceedings.
We confine our rendition of the facts and the procedural history to what is necessary to address the narrow issue on appeal—the propriety of summary judgment based on the running of the statute of limitations. On August 13, 2007, Fernando Kuripet, Maria Kuripet, and Josephina Diaz were injured in a motor vehicle mishap. Fernando Kuripet had a policy with State Farm that provided up to $4,500 a person in PIP benefits. All three received treatment at Zafer Chiropractic for their injuries. They assigned any PIP benefits due under the State Farm policy to Zafer Chiropractic. At some point, Zafer Chiropractic submitted claims to State Farm for PIP benefits covering the care it provided. As we discuss later, the summary judgment record does not establish when Zafer Chiropractic did so. State Farm didn't pay.
On September 27, 2013, Zafer Chiropractic filed two limited actions against State Farm: one to recover benefits due Fernando Kuripet and Maria Kuripet and the other to recover benefits due Diaz. The cases were consolidated in the district court. State Farm answered and pleaded various affirmative defenses, including the running of the statute of limitations. Later, State Farm filed what it titled a motion to dismiss based, in part, on the statute of limitations defense. The motion, however, incorporated evidentiary materials outside the pleadings, converting it to one for summary judgment. See K.S.A.2014 Supp. 60–212(d) ; Lehman v. City of Topeka, 50 Kan.App.2d 115, 117–18, 323 P.3d 867 (2014). The district court found the actions had been filed too late and granted summary judgment for State Farm. Zafer Chiropractic has appealed.
The standards governing summary judgment motions are well known. We repeat them briefly with particular attention to their application to a party seeking summary judgment on an issue on which it bears the burden of proof.
A party requesting summary judgment has the obligation to show, based on appropriate evidentiary materials, that there are no disputed issues of material fact and that judgment may, therefore, be entered in its favor as a matter of law. Thoroughbred Assocs. v.. Kansas City Royalty Co., 297 Kan. 1193, Syl. ¶ 2, 308 P.3d 1238 (2013) ; Shamberg, Johnson & Bergman, Chtd. v. Oliver, 289 Kan. 891, 900, 220 P.3d 333 (2009). In short, the movant argues there is nothing for a jury or a trial judge sitting as factfinder to decide that would make any difference. In addressing a request for summary judgment, the district court must view the evidence most favorably to the party opposing the motion and give that party the benefit of every reasonable inference that might be drawn from the evidentiary record. 289 Kan. at 900. An appellate court applies the same standards, so we are guided by those rules here. Thoroughbred Assocs., 297 Kan. 1193, Syl. ¶ 2.
A statute of limitations bar is an affirmative defense. K.S.A.2014 Supp. 60–208(c)(1)(P). A defendant asserting an affirmative defense bears the burden to prove that defense at trial. Slayden v.. Sixta, 250 Kan. 23, 26, 825 P.2d 119 (1992) (defendant must plead and prove statute of limitations defense). When a defendant seeks summary judgment on an issue on which it would bear the burden of proof at trial, it must furnish sufficient evidence in support of the motion to show entitlement to relief. Golden v. DenMat Corporation, 47 Kan.App.2d 450, 497, 276 P.3d 773 (2012) (A party asserting an affirmative defense “has an obligation to come forward with evidence on summary judgment that would allow a jury to find those facts necessary to show” the defense applies.); see Mickelson v. New York Life Ins. Co., 460 F.3d 1304, 1311 (10th Cir.2006) (if defendant bears ultimate burden of persuasion on issue, defendant must come forward with facts on summary judgment that would allow a jury finding in its favor); Hutchinson v. Pfeil, 105 F.3d 562, 564 (10th Cir.1997) (When advancing an affirmative defense on summary judgment, a defendant has the burden to establish a factual basis for the defense.); Hartman v. Stumbo, 195 Kan. 634, 638–39, 408 P.2d 693 (1965) (noting federal authority to be instructive on summary judgment under Kansas Code of Civil Procedure and recognizing that summary judgment could be granted on statute of limitations where defendant offered plaintiff's deposition testimony and other evidence demonstrating action had been untimely filed).
Because the obligation to pay benefits derives from a written insurance contract, the statute of limitations is 5 years. K.S.A. 60–511(1) ; Patterson v. Allstate Ins. Co., 31 Kan.App.2d 919, 922, 75 P.3d 763 (K.S.A. 60–511 [1] supplies limitations period for PIP benefit claims), rev. denied 276 Kan. 969 (2003). Everybody seems to agree on that much of the law. The crux of the matter is when a cause of action for PIP benefits accrues, thereby triggering the limitations period. As the Patterson court recognized, K.S.A. 40–3110, regulating PIP benefits, governs that issue. 31 Kan.App.2d at 921–22.
As provided in K.S.A. 40–3110(a), a person seeking PIP benefits must submit a claim to the insurance carrier within 2 years of the date of injury. Upon receipt of a notice for benefits showing “the fact of a covered loss” and “the amount of” the loss, the insurance carrier has 30 days to pay the PIP benefits. K.S.A. 40–3110(b). The PIP benefits “shall be overdue if not paid within thirty (30) days after” the notice has been received. K.S.A. 40–3110(b). A cause of action for failure to pay PIP benefits accrues on the 31 st day after a statutorily sufficient notice and proof of claim have been submitted to the insurance carrier if no payment has been tendered. See Patterson, 31 Kan.App.2d at 922 ; Miner v. Farm Bur. Mut. Ins. Co., Inc., 17 Kan.App.2d 598, ¶¶ 8 and 10, 841 P.2d 1093 (1992), rev. denied 252 Kan. 1092 (1993). Those time periods apply to the claims Zafer Chiropractic submitted to State Farm. As the assignee of the contractual rights of Fernando Kuripet, Maria Kuripet, and Diaz, the company acquired any benefits due them and assumed the obligations and protections of the governing statutes.
To establish facts supporting its statute of limitations defense, State Farm had to submit evidence showing when it received notices under K.S.A. 40–3110(b) for any PIP benefits due Fernando Kuripet, Maria Kuripet, and Diaz or payable to Zafer Chiropractic as their assignee. As we explain, State Farm has not done so. Without that evidence, the district court could not properly determine when the cause of action for breach of the insurance contract accrued and, in turn, when the 5–year statute of limitations began to run or when it expired. In short, State Farm has not submitted a properly supported summary judgment motion.
In its motion and supporting memorandum, State Farm argued that the 5–year limitations period began to run on the date of the motor vehicle mishap or the date of injury. But that is incorrect. The date of injury would trigger the personal injury statute of limitations for Fernando Kuripet, Maria Kuripet, and Diaz to sue anyone they considered legally liable for causing the mishap itself. But any personal injury claim would be distinct from a breach of contract claim for insurance benefits—there could be no breach until State Farm failed to pay PIP benefits in confonnity with the policy and the applicable statutes.
In its initial papers, State Farm alternatively argued that the 5–year statute of limitations began to run no later than its denial of any request for PIP benefits. In support of that argument, State Farm submitted a copy of its April 10, 2008, letter to Diaz and represented identical letters went to Fernando Kuripet and Maria Kuripet. The letter, however, is not a denial of benefits and could not fairly be characterized that way, particularly in support of summary judgment. The letter has the tenor of a form communication. The letter first acknowledges Diaz had been injured in a motor vehicle accident and informs her that Fernando Kuripet's policy includes PIP benefits. The letter briefly describes the sort of expenses that may be paid as PIP benefits and then explains how Diaz should go about applying for benefits. Viewed favorably to Zafer Chiropractic, as the party opposing summary judgment, the letter fosters an inference that State Farm had not received any claims for PIP benefits as of April 10, 2008–for whatever that might be worth as an evidentiary matter.
State Farm offered no factual averment in its motion as to when it received the claims for PIP benefits. None of the documents or other evidentiary materials the company submitted with the motion established the date on which it received the claims for PIP benefits.
In its reply to Zafer Chiropractic's opposition to summary judgment, the lawyer for State Farm represented as part of the rebuttal argument that PIP claims were submitted in late January and in February 2008. But a representation of a lawyer in motion papers does not provide an evidentiary foundation for a fact necessary to grant summary judgment. The fact must be supported in the pleadings, discovery materials, or an affidavit or declaration. K.S.A.2014 Supp. 60–256(c)(2) ; see RAMA Operating Co. v. Barker, 47 Kan.App.2d 1020, 1031, 286 P.3d 1138 (2012) (“conclusory affidavits are insufficient to establish contested facts for summary judgment); Midland Mortgage Corp. v. Wells Fargo Bank, N.A., 926 F.Supp.2d 780, 793 (D.S.C.2013) (statements set forth in brief without supporting evidence insufficient on summary judgment); Farm Credit Bank of Spokane v. Parsons, 758 F.Supp. 1368, 1372 (D.Mont.1990) (“legal memoranda, in the summary judgment context, are not evidence, and do not create issue of fact”).
In the reply, the lawyer refers to defense exhibits “to be supplemented upon request at the hearing” as supportive of the assertion. The reply brief does not clearly say what those exhibits might be. More significantly, the exhibits do not appear in the record, so we cannot consider them. See State v. Valladarez, 288 Kan. 671, 686, 206 P.3d 879 (2009) (appellate court will not consider materials outside record on appeal even if appended to appellate brief).
The district court apparently relied solely on State Farm's unsupported assertion in its reply brief to conclude when the claims for PIP benefits had been submitted. As we have outlined, the district court should not have drawn such a conclusion without a proper factual basis in the summary judgment record. We find no such basis. We, therefore, reverse the summary judgment in favor of State Farm and remand for further proceedings consistent with this opinion.
On remand, the district court should address Zafer Chiropractic's motion to amend to reflect its proper corporate capacity. The district court understandably found the motion to be moot in light of its grant of summary judgment. The parties addressed the motion to amend as a secondary issue in their appellate briefing. We decline to engage the issue in the absence of a district court ruling.
Reversed and remanded with directions.