Biby v. Kansas City Life Ins. Co.
| Decision Date | 26 September 1980 |
| Docket Number | No. 79-1922,79-1922 |
| Citation | 629 F.2d 1289 |
| Parties | James BIBY; Jeffrey Gourson and Samuel A. Keesal, Jr., Co-Executors of the Estate of N. Edward Gourson, Appellants, v. KANSAS CITY LIFE INSURANCE CO. and Mid-Delta Land & Investment Co., and Estate of Norvel Duncan, Appellees. |
| Court | U.S. Court of Appeals — Eighth Circuit |
Robert H. Logan, Samuel A. Keesal, Jr., Keesal, Young & Logan, a Professional Corporation, Long Beach, Cal., Philip E. Kaplan, Kaplan, Brewer & Bilheimer, P. A., Little Rock, Ark., for appellants.
Randolph B. Hopkins, Barber, McCaskill, Amsler, Jones & Hale, Little Rock, Ark., for appellees.
Before STEPHENSON and McMILLIAN, Circuit Judges, and VIETOR, * District Judge.
This is an appeal from an order of the United States District Court for the Eastern District of Arkansas 1 dismissing appellants' complaint in a diversity action that had been transferred from the Central District of California on the ground that it is barred by the applicable statutes of limitations. We affirm.
Appellants are residents of California and appellees are residents of Arkansas and Missouri. Appellants' complaint, which arises out of a land transaction in 1971 and 1972, consists of three claims for relief; one alleges fraud, one alleges breach of fiduciary duty, and one alleges negligence. The applicable statute of limitations on each claim expired before December 30, 1977, the date the complaint was filed, unless it was timely tolled. Appellants assert that the statutes of limitations were tolled by events in the course of some companion litigation, hereinafter called the original lawsuit, which we trace below.
On February 13, 1976, appellants initiated the original lawsuit by filing a complaint against appellees and others in respect to the 1971-72 land transactions in the United States District Court for the Central District of California. 2 That complaint asserted claims for relief for alleged violations of section 10(b) of the Securities Exchange Act of 1934, violation of California security laws, fraud, conspiracy, breach of warranty, and negligence. Although the matter is in dispute, we assume that this complaint was filed within the time allowed by the applicable statutes of limitations. By agreement of the parties that complaint was dismissed without prejudice, and a first amended complaint was filed on December 9, 1976.
Appellees and defendants Keith Duncan and Norvel Duncan appeared specially in the original lawsuit to question the jurisdiction of the court over them. After some discovery and before resolution of the jurisdiction question, appellants and appellees and defendants Keith Duncan and Norvel Duncan entered into agreements for dismissal orders, which provided, in relevant part, as follows:
IT IS HEREBY STIPULATED by and between Plaintiffs James Biby and Ed Gourson and Defendants Keith Duncan and Norvel Duncan, by and through their respective counsel, that the First Amended Complaint in this matter be dismissed as to Keith Duncan and Norvel Duncan without prejudice to the Plaintiffs' refiling the Complaint on or before August 24, 1977.
IT IS FURTHER STIPULATED that Defendants waive the further running, if any, for a period of 180 days commencing with the date of the signing of this Order and ending 180 days from the date of the signing of this order, of any applicable statutes of limitations.
SAMUEL A. KEESAL, JR.
By /s/ Michael M. Gless
MICHAEL M. GLESS
Attorneys for Plaintiffs
Dated: March 10, 1977
MUNGER, TOLLES &
RICKERSHAUSER
By /s/ Harvey I. Saferstein
HARVEY I. SAFERSTEIN
Attorneys for Defendants
Keith Duncan and Norvel Duncan
Dated: March 9, 1977
IT IS SO ORDERED:
Dated: 3/16/77
/s/ HARRY PREGERSON
HARRY PREGERSON
UNITED STATES
IT IS HEREBY STIPULATED, by and between plaintiffs James Biby and Ed Gourson and defendants Kansas City Life Insurance Company and Mid-Delta Land and Investment Company, by and through their respective counsel of record, that:
1. The First Amended Complaint in this matter be dismissed as to Kansas City Life Insurance Company and Mid-Delta Land and Investment Company, without prejudice, to plaintiffs refiling said Complaint on or before August 24, 1977;
2. In the event said First Amended Complaint is refiled on or before August 24, 1977, such proceedings as to said defendants shall be deemed to have commenced on the date of filing of the initial Complaint in the above-entitled action as to the claims made in the initial complaint herein, for the purposes of any applicable statute of limitations. It is understood and agreed, however, that no waiver or other relinquishment of any applicable statute of limitations or other claim or defense which said defendants may have to the initial complaint herein or the First Amended Complaint herein or at the time of valid service of process thereof shall be found from or is intended by this Stipulation or otherwise.
DATED: March 4, 1977.
SAMUEL A. KEESAL, JR.
MICHAEL M. GLESS
By /s/ Michael M. Gless
Attorneys for Plaintiffs
GIBSON, DUNN & CRUTCHER
ARTHUR L. SHERWOOD
PHILLIP L. BOSL
By /s/ Arthur L. Sherwood
Attorneys for Defendants
Kansas City Life Insurance
Company and Mid-Delta Land
and Investment Company
ORDER
On the basis of the foregoing Stipulation, it is Ordered that Defendants Kansas City Life Insurance Company and Mid-Delta Land and Investment Company are hereby dismissed, without prejudice.
DATED: March 14, 1977.
/s/ Harry Pregerson
United States
The first amended complaint in the original lawsuit was not dismissed as to the other defendants.
On August 18, 1977, six days before the August 24 deadline for refiling the complaint and before the expiration of the 180 days referred to in the Duncan stipulation, appellants' counsel telephoned counsel for appellees and Keith Duncan and Norvel Duncan or his estate 3 and obtained an agreement to further extend the time to December 31, 1977, within which to refile the complaint. On that same date, counsel for appellants wrote a letter to counsel for appellees and Keith Duncan and Norvel Duncan or his estate confirming the agreement. Nothing further was done by appellants to perfect the extension agreed to; specifically, there was never an attempt to comply with Local Rule 1.7 for the United States District Court for the Central District of California, which provides as follows:
On December 19, 1977, in response to a motion by the remaining defendants in the original lawsuit and over the objection of appellants, the original lawsuit was ordered transferred from the Central District of California to the Eastern District of Arkansas.
On December 30, 1977, appellants filed their present complaint against appellees and Keith Duncan and the Norvel Duncan estate as a new lawsuit in the United States District Court for the Central District of California. On that same date, summonses were issued by the California clerk to the United States Marshal for the Central District of California for each defendant, but were returned "not executed" by the marshal on February 2, 1978, with the notation under reason for lack of service: "No instructions received." No effort was made by appellants to complete service of the summonses during the pendency of the proceeding in California.
On January 9, 1978, appellants filed an ex parte application for transfer of the new lawsuit to the Eastern District of Arkansas pursuant to 28 U.S.C. § 1404(a), alleging that Arkansas was a more convenient venue for purposes of trial and that a companion case, the original lawsuit which was still pending against the undismissed defendants, had already been transferred to the Eastern District of Arkansas. An order granting the transfer to Arkansas was entered on the same day, and the new lawsuit was received and docketed by the clerk in Arkansas on January 12, 1978. Summonses were issued for the appellees and Keith Duncan on March 22, 1978, and they were served on April 3, 1978. Apparently no summons was issued in Arkansas for the other defendant, the estate of Norvel Duncan. The appellees had no knowledge of the filing of the new complaint until they were served in April.
The district court dismissed the new complaint in response to motions to dismiss filed by appellees Kansas City Life Insurance Company and Mid-Delta Land and Investment Company and a motion for summary judgment filed by Keith Duncan. 4
The district court predicated its holding that the complaint is barred by the statutes of limitations on two separate legal conclusions: (1) the oral agreement to extend the time for refiling a complaint against appellees and the Duncans was ineffective because there was not compliance with either Local Rule 1.7 of the Central District of California, supra, or Local Rule 6 of the Eastern District of Arkansas, which provides: "The Court will not recognize any agreement between counsel if counsel differ as to its terms, unless the agreement has been reduced to writing." 5 (2) Assuming a valid extension to December 31, 1977, under all of the circumstances the filing of the complaint in the Central District of California on December 30, 1977, did not commence the action for purposes of tolling the statutes of limitations.
We agree with the district court that the August agreement of counsel did not constitute a valid extension of time within which to refile the complaint. Local Rule 1.7 of the Central District of California expressly provides that an agreement "affecting the progress of the case will not be effective unless approved by the Judge." The language of the rule is plain, and it is also plain that an agreement to extend the time for refiling a complaint...
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