Franzen v. Deere and Co.

• Decision Date: 22 July 1987
• Docket Number: No. 86-837,86-837
• Citation: 409 N.W.2d 672
• Parties: Eligius FRANZEN and Hannah Franzen, Plaintiffs, v. DEERE AND COMPANY, Defendant. DEERE AND COMPANY, Applicant-Appellant, v. DONOHUE LAW OFFICE, P.C., Resister-Appellee.
• Court: Iowa Supreme Court

Page 672

409 N.W.2d 672

Eligius FRANZEN and Hannah Franzen, Plaintiffs, v. DEERE AND COMPANY, Defendant.

DEERE AND COMPANY, Applicant-Appellant, v. DONOHUE LAW OFFICE, P.C., Resister-Appellee.

No. 86-837.

Supreme Court of Iowa.

July 22, 1987.

David L. Riley, of Lindeman & Yagla, Waterloo, and Eric C. Rose, Moline, Ill., for applicant-appellant.

Scott D. Brown, of Brown, Kinsey & Funkhouser, Mason City, for resister-appellee.

Considered en banc.

WOLLE, Justice.

Much of the drama of this products liability case has already been played out in proceedings which led to two previous decisions of this court. See Franzen v. Deere & Co., 334 N.W.2d 730 (Iowa 1983) (Franzen I); Franzen v. Deere & Co., 377 N.W.2d 660 (Iowa 1985) (Franzen II). At issue in this third appeal is the defendant Deere and Company's application to require the plaintiffs' lawyer to pay the attorney fees Deere incurred in successfully defending the lawsuit and prosecuting the two appeals. Deere did not file its application in the district court until after we had affirmed summary judgment for Deere in Franzen II, and plaintiffs and their lawyer contended the application was filed too late to give the district court authority to decide the issue. The trial court rejected that challenge to jurisdiction of this particular case, but after a plenary hearing the court found no merit in the application for attorney fees and dismissed it. On appeal Deere seeks to impose its attorney fees only on the plaintiffs' lawyer, dropping its claim against the plaintiffs themselves. We conclude the application was indeed filed too late to give the district court authority to act on it, and we therefore affirm.

Plaintiff Eligius Franzen was injured while using a Deere-manufactured forage wagon on June 25, 1979. The Franzens filed a damage action against Deere on March 10, 1982. In response to Deere's motion to dismiss asserting the action was barred by Iowa's two-year statute of limitations, Franzens amended their petition to allege that they did not discover the wagon's defect until January of 1981 notwithstanding due diligence on their part. The district court sustained Deere's motion to dismiss, but in Franzen I we reversed and remanded to allow Franzens the opportunity to present evidence supporting a discovery rule exception to the governing two-year statute of limitations. Iowa Code § 614.1(2) (1979); see Franzen I, 334 N.W.2d at 732-33. Following remand and completion of discovery, Deere moved for summary judgment based on its statute of limitations defense. The trial court granted the motion, and we affirmed that summary judgment in Franzen II, finding that the "record shows no genuine issue of fact supporting application of the discovery rule...." Franzen II, 377 N.W.2d at 661.

More than a month after the filing of our Franzen II decision, Deere filed in the district court its application requesting that the court require Franzens and their lawyer to pay the attorney fees incurred by Deere in defending the allegedly frivolous lawsuit. Deere presented two theories for recovery of its attorney fees: (1) the district court should order Franzens and their lawyer to pay the attorney fees as a sanction for violation of Iowa Rule of Civil Procedure 80(a); and (2) the district court should exercise its inherent power to tax the fees as costs. Franzens and their lawyer fought the application on several fronts, contending that it was filed too late to give the court authority to decide it and that it was otherwise entirely without merit.

We do not reach the substantive issues on which the district court found the application was without merit. We conclude at the threshold that the court was without authority to consider the application, because it lost jurisdiction of this particular case once the final judgment had been affirmed without remand in Franzen II.

Iowa Rule of Civil Procedure 80(a), as amended effective April 1, 1986, provides in pertinent part:

Counsel's signature to every motion, pleading, or other paper shall be deemed a certificate that: counsel has read the motion, pleading, or other paper; that to the best of counsel's knowledge, information, and belief, formed after reasonable inquiry, it is well grounded in fact and is warranted by existing law or a good faith argument for the extension, modification, or reversal of existing law; and that it is not interposed for any improper purpose, such as to harass or cause an unnecessary delay or needless increase in the cost of litigation. If a motion, pleading, or other paper is not signed, it shall be stricken unless it is signed promptly after the omission is called to the attention of the pleader or movant. If a motion, pleading, or other paper is signed in violation of this rule, the court, upon motion or upon its own initiative, shall impose upon the person who signed it, a represented party, or both, an appropriate sanction, which may include an order to pay the other party or parties the amount of the reasonable expenses incurred because of the filing of the motion, pleading, or other paper, including a reasonable attorney fee.

Rule 80(a) serves the important purpose of discouraging parties and their counsel from filing frivolous lawsuits, motions, and pleadings. We adopted the rule in its present form in April of 1986, borrowing the wording of the last sentence concerning sanctions from Federal Rule of Civil Procedure 11. We thereby served notice that trial courts should not and will not countenance misuse of pleadings, motions, or other court papers. The important last sentence of the rule is mandatory in character: "the court, upon motion or upon its own initiative, shall impose " appropriate sanctions for violation of the rule. Iowa R.Civ.P. 80(a) (emphasis added). This new language concerning sanctions, like the identical language of the federal rule, was intended to reduce the reluctance of courts to impose sanctions on parties and attorneys who violate their responsibilities to the court and other parties. The advisory committee note which accompanied amendment of the federal rule to include that last sentence states:

Greater attention by the district courts to pleading and motion abuses and the impositions of sanctions when appropriate, should discourage dilatory or abusive tactics and help to streamline the litigation process by lessening frivolous claims or defenses.

Amendments to the Federal Rules of Civil Procedure, 97 F.R.D. 165, 198 (1983); see C. Wright, A. Miller & M. Kane, 5 Federal Practice and Procedure §§ 1331-34 (1986 Supp.).

The threshold issue in this case, however, is whether Deere filed its motion too late to give the court jurisdiction to consider it. Even though Deere based its rule 80(a) motion on information available to it when the district court heard its motion for summary judgment on December 3, 1984, Deere waited until January 20, 1986 to file its motion. Deere's belated filing deprived the district court of authority to decide the attorney fees issue.

Neither rule 80(a), its federal counterpart (Fed.R.Civ.P. 11), nor any other Iowa rule or statute sets a deadline for the filing of a motion to impose sanctions. The language of rule 80(a) does make clear, however, that such a request is to be filed in the lawsuit in which the violation allegedly has occurred, not in a separately filed action at law or in equity. The rule provides for entry of "an order to pay" which clearly means an order entered in the underlying case itself. Moreover, the district court may act "upon motion or upon its own initiative," strongly suggesting that the court's authority to take such action arises in the lawsuit in which the rule 80(a) violations have occurred.

It follows that any motion or application to impose rule 80(a) sanctions must be filed while the underlying action is pending and before the court's authority to act on issues within that lawsuit expires. See Rerat Law Firm v. Iowa Dist. Court, 375 N.W.2d 226, 230 (Iowa 1985) (distinguishing jurisdiction of the particular case from subject matter jurisdiction and in personam jurisdiction). Ordinarily the authority of the district court to decide substantive issues in a particular case terminates when a final judgment is entered and postjudgment motions have been resolved. A final judgment, one that conclusively determines the rights of the parties and finally decides the controversy, creates a right of appeal and also removes from the district court the power or authority to return the parties to their original positions. Snyder v. Allamakee County, 402 N.W.2d 416, 418 (Iowa 1987); Robco Transp., Inc. v. Ritter, 356 N.W.2d 497, 499 (Iowa 1984). In the absence of a remand or procedendo directing further proceedings in the trial court, the jurisdiction of the district court terminates both as to the parties and the subject matter when a district court judgment has been affirmed. Jersild v. Sarcone, 163 N.W.2d 78, 79 (Iowa 1968); see Dunton v. McCook, 120 Iowa 444, 448, 94 N.W. 942, 944 (1903) ("So far as the questions at issue were concerned, the suit, upon affirmance, became a part of the irrevocable past.").

While a district court retains jurisdiction during and after appeal from its...