Evjen v. Brooks

• Decision Date: 31 July 1985
• Docket Number: No. 84-1055,84-1055
• Citation: 372 N.W.2d 494
• Parties: George M. EVJEN, Administrator of the Estate of Mark Allen Evjen, Plaintiff, v. Philip D. BROOKS, Administrator of the Estate of Mark J. Pauly, Appellee, The Southland Corporation, and 7-Eleven, Mt. Vernon Road, S.E., Cedar Rapids, Iowa, Appellant.
• Court: Iowa Supreme Court

Page 494

372 N.W.2d 494

George M. EVJEN, Administrator of the Estate of Mark Allen Evjen, Plaintiff, v. Philip D. BROOKS, Administrator of the Estate of Mark J. Pauly, Appellee The Southland Corporation, and 7-Eleven, Mt. Vernon Road, S.E., Cedar Rapids, Iowa, Appellant.

No. 84-1055.

Supreme Court of Iowa.

July 31, 1985.

Craig A. Levien and Vicki L. Seeck, Davenport, for appellant.

Robert R. Rush and John C. Monroe of Lynch, Dallas, Smith & Harman, Cedar Rapids, for appellee.

Considered by UHLENHOPP, P.J., and HARRIS, McGIVERIN, LARSON, and SCHULTZ, JJ.

LARSON, Justice.

Two defendants in a wrongful death case arising out of a car accident cross-claimed against the estate of the driver for indemnity or contribution. Summary judgment was entered for the estate on the ground the cross-claim was barred by the six-month limitation of Iowa Code section 633.410 (1981). We reverse.

On March 14, 1982, Mark J. Pauly, the driver, and Mark Allen Evjen, his passenger, were both killed in a one-car accident. Estates were opened for both Pauly and Evjen. The six-month period for filing claims in the Pauly estate began to run on May 1, 1982, the date of publication of the second notice to creditors. See Iowa Code § 633.410 (1981). It is the application of this statute, our nonclaims statute, in the Pauly estate which is the focal point of this appeal.

In August, 1982, an attorney for the Evjen estate (hereinafter Evjen) sent a letter to the local 7-Eleven store and its owner-operator, The Southland Corporation, informing them of his intention to bring an action for damages under Iowa Code section 123.93 (actually section 123.92, the dram-shop statute). Such a notice to the liquor licensee or permittee or their insurance carrier is required to notify them of the intention to bring a dram-shop action and "indicating the time, place and circumstances causing the injury." This notice must be given in writing and within six months of the occurrence. Iowa Code § 123.93 (1981). The notice to Southland and the 7-Eleven store complied with these requirements. It notified them of the accident and the resulting deaths. It also stated that

at the time and place of said fatal accident the automobile, operated by Mark James Pauly, was traveling at a high rate of speed and failed to negotiate a curve in the road on Indian Hill Rd. S.E. Cedar Rapids, Linn County, Iowa and did strike a tree killing both Mark Allen Evgen [sic] and Mark James Pauly. That at the time and place of said fatal accident the operator of the automobile, Mark James Pauly, was in an intoxicated condition as a result of the consumption of alcoholic beverages obtained on or about the 14th day of March, 1982 from the 7-Eleven Store located at 3342 Mt. Vernon Rd. S.E. Cedar Rapids, Linn County, State of Iowa.

This notice was dated August 11, 1982, and receipt of it was acknowledged by Southland's legal department on August 30, 1982.

On receipt of this notice, an adjuster for Southland's insurance company telephoned Evjen's attorney and requested information that would connect Southland with the fatal accident. The attorney for the estate indicated at that time that he had no such information to forward. He simply wanted to put Southland on notice of his intention to bring the action and, presumably, to keep the dram-shop action alive by complying with the notice provisions of section 123.93. Southland's insurer followed up the phone call with a letter requesting the same information. No such information was forthcoming.

The claims period in the Pauly estate expired on November 1, 1982. On May 10, 1983, Evjen sued the Pauly estate, Southland, and the local 7-Eleven store. The petition alleged negligence and intoxication of Pauly and the illegal sale of liquor by the defendants Southland and the local 7-Eleven.

The Pauly estate moved for summary judgment on Evjen's suit on the ground it had failed to file a timely probate claim under section 633.410. Evjen resisted, urging that "peculiar circumstances" existed so as to provide an exception under section 633.410. The court ruled that the claim was covered by section 633.410 and that no peculiar circumstances existed. Summary judgment for the Pauly estate was entered, and Evjen's claim against it was dismissed. That ruling was affirmed by the court of appeals in an opinion reported at 365 N.W.2d 52 (Iowa Ct.App.1985).

On August 1, 1983, Southland filed a cross-claim against the Pauly estate for indemnity or contribution asserting that Pauly had been guilty of "active and primary" negligence in causing the fatal accident. Southland also filed a probate claim in the estate, on August 17, 1983, and attached a copy of its cross-claim as an exhibit.

By the time the cross-claim and the probate claim were filed, approximately nine months had passed since the expiration of the six-month claims period. The Pauly estate moved for summary judgment on the ground the cross-claim was barred by section 633.410. Southland resisted, claiming that a demand for indemnity or contribution was not a "claim" covered by section 633.410 until a judgment or settlement fixed the extent of liability, if any, of the indemnitee. It also claimed peculiar circumstances excused its late filing of the claim.

The district court, apparently assuming a claim for indemnity or contribution was covered by section 633.410, granted summary judgment for the estate on the ground that peculiar circumstances had not been established.

Section 633.410 provides:

All claims against a decedent's estate, other than charges, whether due or to become due, absolute or contingent, liquidated or unliquidated, founded on contract or otherwise, shall be forever barred against the estate, the personal representative, and the distributees of the estate, unless filed with the clerk within six months after the date of the second publication of the notice to creditors; provided, however, that the personal representative may waive such limitation on filing; and this provision shall not bar claimants entitled to equitable relief due to peculiar circumstances.

(Emphasis added.) The claims period has now been reduced from six months to four, 1984 Iowa Acts ch. 1080, § 9, but this amendment does not affect this case.

Nowhere in chapter 633 is "claim" defined. The language of section 633.410, however, suggests a broad interpretation of that term, applying to "[a]ll claims ... whether due or to become due, absolute or contingent, liquidated or unliquidated...." Iowa Code section 633.424 requires that "[c]ontingent claims which cannot be allowed as absolute debts shall, nevertheless, be filed in the court and proved." Section 633.424 also provides the procedure for processing a contingent claim.

In Baldwin v. City of Waterloo, 372 N.W.2d 486 (Iowa 1985), filed today, we considered an analogous question, whether a cross-petition to bring in an additional defendant was a "claim" under section 633.410. We concluded that it was. In Baldwin, we adopted a test suggested by an earlier Iowa case for determining whether the contingent claim in question would be barred if not filed within the time provided by the nonclaim statute. Under that test, the question is not whether the claim has in fact "accrued," or the degree of certainty in the claim; rather the test is whether the basis for such a claim against the decedent was "reasonably foreseeable" during the time the claims period remained open. See Nichols v. Harsh, 202 Iowa 117, 209 N.W. 297 (1926). See generally S. Kurtz & R. Reimer, Iowa Estates: Taxation and Administration § 13.13, at 441 (1975).

It must be kept in mind that whether a particular claim is of such a nature that it can be barred by section 633.410 is a separate issue from the question of whether in fact it will be barred. The latter question turns on whether "peculiar circumstances" exist, an area of inquiry which allows broad consideration of the circumstances surrounding the claim. At this point, we consider only the question whether the claim for indemnity or contribution can be barred by section 633.410.

I. Is This a "Claim" Under Section 633.410?

It is true, as Southland points out, an action for indemnity or contribution accrues or becomes enforceable only when the indemnitee's legal liability becomes fixed or certain as in the entry of judgment or a settlement. See Vermeer v. Sneller, 190 N.W.2d 389, 392 (Iowa 1971); Archibald v. West Paper Stock Co., 176 N.W.2d 761, 763-64 (Iowa 1970); Kroblin Transfer, et al. v. Birmingham Fire Insurance Co., 239 Iowa 15, 18, 30 N.W.2d 325, 327 (1948); Duke v. Tyler, 209 Iowa 1345, 1349, 230 N.W. 319, 320-21 (1930); Samuelson v. Chicago, R.I. & Pac. R.R., 287 Minn. 264, 268, 178 N.W.2d 620, 624 (1970); Furnish, Distributing Tort Liability: Contribution and Indemnity in Iowa, 52 Iowa L.Rev. 31, 53 (1966); 42 C.J.S. Indemnity § 21, at 596 (1944) ("an implied contract of indemnity arises in favor of a person who without fault on his part is exposed to liability and compelled to pay damages on account of the negligence or tortious act of another....").

Under these principles, Southland could not have enforced an indemnity or contribution claim during the six-month claims period, because it had not yet been subjected to liability. There is a difference, however, between the accrual of the cause of action sufficient to allow suit and a "contingent claim" for purposes of Iowa Code section 633.410. We have previously discussed, in another context, the distinction between a right of contribution in the inchoate stage and one which is "accrued" so as to provide a basis for a cause of action.

It is important to note ... the distinction between the accrual of the right to recover contribution and the inchoate right to contribution before payment or discharge of the common liability. Even though a cause of action for contribution does not become complete until the claimant's act of payment or discharge of more than his...