Hosogai v. Kadota

• Decision Date: 20 February 1985
• Docket Number: No. 17665-PR,17665-PR
• Citation: 145 Ariz. 227,700 P.2d 1327
• Parties: Michiko HOSOGAI, a surviving widow, individually and on behalf of the surviving children of Fukuo Hosogai, deceased, Plaintiffs-Appellants, v. Hiroshi KADOTA, or if deceased, John Doe I, the personal representative or administrator of the estate of Hiroshi Kadota and John Doe II guardian if Hiroshi Kadota is mentally incompetent, Defendant-Appellee.
• Court: Arizona Supreme Court

Page 1327

700 P.2d 1327

145 Ariz. 227

Michiko HOSOGAI, a surviving widow, individually and on behalf of the surviving children of Fukuo Hosogai, deceased, Plaintiffs-Appellants, v. Hiroshi KADOTA, or if deceased, John Doe I, the personal representative or administrator of the estate of Hiroshi Kadota and John Doe II guardian if Hiroshi Kadota is mentally incompetent, Defendant-Appellee.

No. 17665-PR.

Supreme Court of Arizona, In Banc.

Feb. 20, 1985.

Reconsideration Denied March 12, 1985.

Monbleau, Vermeire & Turley by Albert Vermeire, Kent E. Turley and Christopher J. Bork, Phoenix, for plaintiffs-appellants.

O'Connor, Cavanagh, Anderson, Westover, Killingsworth & Beshears by John H. Westover, Larry L. Smith and Brian C. Bond, Phoenix, for defendant-appellee.

HAYS, Justice.

On March 25, 1976, Michiko Hosogai, petitioner/appellant, sued Hiroshi Kadota, respondent/appellee, for the wrongful death of her husband. In this first action (Hosogai I ), the jury awarded petitioner $225,000 in damages. This verdict was overturned on appeal because the trial court lacked personal jurisdiction over appellee due to defective service of process. Kadota v. Hosogai, 125 Ariz. 131, 608 P.2d 68 (App.1980). On March 19, 1980, petitioner filed another wrongful death action (Hosogai II ) against respondent based on the same facts as the earlier suit. This lawsuit was dismissed by the trial court as barred by the two-year statute of limitations governing wrongful death actions. See A.R.S. § 12-542(2). The Court of Appeals affirmed in a memorandum decision. Hosogai v. Kadota, 145 Ariz. 254, 700 P.2d 1354 (App.1984). We have jurisdiction. Ariz. Const. art. 6, § 5(3); 17A A.R.S. Civil Appellate Proc.Rules, Rule 23; A.R.S. § 12-120.24. We vacate the memorandum decision of the Court of Appeals. We accepted this petition for review to address one question:

MAY THE STATUTE OF LIMITATIONS FOR A SECOND WRONGFUL DEATH ACTION BE EQUITABLY TOLLED BY THE FILING OF A FIRST ACTION DISMISSED BECAUSE OF A PROCEDURAL DEFECT?

FACTS

On July 26, 1975, Hiroshi Kadota, respondent, was driving on a highway near Prescott, Arizona. Respondent's automobile collided with a motor home. Fukuo Hosogai, a passenger in the automobile, was killed. The driver, respondent, suffered severe brain damage. At this time, respondent was a Japanese citizen residing in Arizona. Shortly after the accident, respondent returned to Japan where he has resided since that time. Petitioner sued respondent in Hosogai I, alleging that respondent's negligent driving caused the death of her husband.

Petitioner attempted to serve respondent by three different methods of process. First, petitioner filed an affidavit of a private process server stating that she had served the Arizona Superintendent of Motor Vehicles in accord with a statute authorizing personal jurisdiction over foreign motorists involved in accidents within the state. See A.R.S. §§ 28-502 and 28-503. Second, petitioner filed the affidavit of a Japanese process server which stated that he personally served respondent in Japan with a copy of the summons, together with a Japanese translation of the document. Third, petitioner personally served respondent's Arizona guardian ad litem.

After a jury verdict in her favor, the Court of Appeals reversed due to insufficiency of service of process. Kadota v. Hosogai, supra.

First, the court held that attempted service on the Arizona Superintendent of Vehicles was defective. Kadota v. Hosogai, 125 Ariz. at 137-38, 608 P.2d at 74-75. Petitioner had failed to comply with the statute by filing an affidavit regarding the use of registered mail or by filing a return-mail receipt with the court. A.R.S. § 28-503(A)(1). Similarly, the attempted service on respondent through a Japanese process server was ineffective. Kadota v. Hosogai, 125 Ariz. at 134-37, 608 P.2d at 71-74. The court concluded that the procedures for service of process created by a treaty with Japan on "Service Abroad of Judicial and Extrajudicial Documents," February 10, 1969, United States-Japan, 20 U.S.T. 361-67, T.I.A.S. No. 6638, were exclusive and that respondent hadn't complied with these procedures. Finally, it was held that the attempted service of process on the guardian ad litem was invalid. Kadota v. Hosogai, 125 Ariz. at 138-39, 608 P.2d at 75-76. The court concluded that a guardian ad litem is not the agent of an incompetent defendant for purposes of accepting service of process.

We denied review of Kadota v. Hosogai on March 11, 1980. On March 19, 1980, petitioner filed a new wrongful death action (Hosogai II ) against respondent. The trial court dismissed the action as barred by the statute of limitations and the Court of Appeals affirmed. Hosogai v. Kadota, supra.

EQUITABLE TOLLING OF THE STATUTE OF LIMITATIONS

Petitioner contends that the statute of limitations should be equitably tolled for a second action by the filing of a procedurally defective first action if there is: 1) timely notice to the defendant by filing the first claim; 2) no prejudice to the defendant in gathering evidence to defend against the second claim; and 3) reasonable and good faith conduct by the plaintiff in prosecuting the first claim and diligence in filing the second claim. Addison v. State, 21 Cal.3d 313, 578 P.2d 941, 146 Cal.Rptr. 224 (1978). We agree.

We must first determine whether petitioner preserved for appeal the question of the equitable tolling of the statute of limitations. Respondent urges that petitioner waived this error because she raised it for the first time in the Court of Appeals. We disagree. Although not denominated as a theory of "equitable tolling," petitioner argued below that public policy required tolling of the statute of limitations in this case. Petitioner reasoned that tolling was warranted because her opponent received timely notice of the claims against him and was not prejudiced by the delay. Petitioner also urged that she reasonably prosecuted the first action that was dismissed after the expiration of the statute of limitations. These are essentially the same arguments that are now before this court. Additionally, petitioner cited as authority two important equitable tolling cases: Burnett v. New York Central R.R., 380 U.S. 424, 85 S.Ct. 1050, 13 L.Ed.2d 941 (1965) and Brooks v. Southern Pacific Co., 105 Ariz. 442, 466 P.2d 736 (1970).

The Court of Appeals rejected the doctrine of equitable tolling primarily because it inferred legislative disapproval of this doctrine by the legislature's failure to enact a savings statute that applies to these facts. A "savings" statute allows an action, dismissed for reasons unrelated to the merits after the statute of limitations has expired, to be reinstated if a second action is filed promptly thereafter. See Ferguson, Statutes of Limitation: Savings Statutes (1978) (hereinafter referred to as "Ferguson "). Arizona does not have a general savings statute for civil actions, although tolling is available in certain limited circumstances. See A.R.S. § 12-501 (action tolled while defendant is absent from state); A.R.S. § 12-502 (action tolled during minority, insanity, and under some circumstances, the imprisonment of the plaintiff); A.R.S. § 12-507 (action tolled for persons removing to this state); A.R.S. § 44-2404(C) (savings statute for breach of sales contract actions under the Uniform Commercial Code). None of these savings provisions apply to the case at bar. We concede this much of the Court of Appeals argument.

We reject, however, the court's presumption that mere silence on a particular subject necessarily indicates legislative disapproval in all cases. There is a tendency for legislative inaction in certain areas of the law. The argument for implied legislative rejection would be considerably enhanced if there was evidence that the legislature failed to act after being presented with a bill to enact a civil savings statute covering this situation. We could not find any bill presented to the legislature for a general civil savings statute or which would apply to the instant facts. See the General Index to each volume of The Journal of the House of Representatives (1912-1984) and The Journal of the Senate (1912-1984). Nor could we find any rejected amendments to existing savings statutes which would cover the same ground. The general tolling provisions for statutes of limitations in article 1, chapter 5 of title 12, date back to the 1901 Civil Code and were adopted from similar Texas statutes. See Historical Notes to A.R.S. §§ 12-501 to 12-510. Like most western states, Texas had no general savings statute for civil actions. In 1978, the Arizona Legislature passed a general savings statute in criminal actions. See A.R.S. § 13-107. At this time, no proposal was presented to the legislature to pass a civil counterpart of this general savings statute. We can find no legislative disapproval of savings statutes generally or the equitable tolling doctrine in particular.

A court has a legitimate interest in the procedural rules that govern lawsuits, especially to prevent such rules from becoming a shield for serious inequity. Accordingly, a court may under certain circumstances make narrow equitable exceptions to statutes of limitations. See American Pipe & Constr. Co. v. Utah, 414 U.S. 538, 552-59, 94 S.Ct. 756, 765-69, 38 L.Ed.2d 713, 726-30 (1974); Burnett v. New York Central R.R., supra, 380 U.S. at 426-30, 85 S.Ct. at 1053-55, 13 L.Ed.2d at 944-45. The history of the equitable tolling doctrine evidences this claim.

The equitable tolling doctrine is rooted in a number of common law exceptions to statutes of limitations, including: defendant's fraudulent concealment of a cause of action, see Holmberg v. Armbrecht, 327 U.S. 392, 66 S.Ct. 582, 90 L.Ed. 743 (1946); Annot. 15 A.L.R.2d 500 (1951); defendant's inducement of plaintiff not to sue, see Glus v. Brooklyn Eastern District Terminal, 359 U.S. 231, 79 S.Ct. 760, 3 L.Ed.2d 770 (1...