Joyce v. Garnaas, 98-179.

• Decision Date: 15 July 1999
• Docket Number: No. 98-179.,98-179.
• Parties: Richard M. JOYCE, Plaintiff and Appellant, v. H.L. GARNAAS, Defendant and Respondent.
• Court: Montana Supreme Court

983 P.2d 369

1999 MT 170

Richard M. JOYCE, Plaintiff and Appellant, v. H.L. GARNAAS, Defendant and Respondent.

No. 98-179.

Supreme Court of Montana.

Submitted on Briefs December 17, 1998.

Decided July 15, 1999.

Gene R. Jarussi, Jarussi & Bishop; Billings, Montana, For Appellant.

Gary L. Graham; Garlington, Lohn & Robinson, PLLP; Missoula, Montana, For Respondent.

Justice JIM REGNIER delivered the opinion of the Court.

¶ 1 On October 24, 1995, Richard Joyce filed this action in the Thirteenth Judicial District Court, Yellowstone County, against H.L. Garnaas to recover damages for professional negligence. The case was subsequently moved to the Fourth Judicial District Court, Missoula County, following a stipulation for a change of venue. Garnaas thereafter moved for summary judgment on the grounds that Joyce's suit was barred by the ten-year statute of repose applicable to actions for legal malpractice. The District Court granted Garnaas's motion on December 2, 1997, and Joyce appeals. We affirm.

¶ 2 The sole issue on appeal is whether the District Court erred when it granted Garnaas's motion for summary judgment.

FACTUAL AND PROCEDURAL BACKGROUND

¶ 3 On July 4, 1978, Joyce was involved in a traffic accident in which the motorcycle he was driving collided with a vehicle driven by Edward John Glenn. Joyce's attorney, H.L. Garnaas, filed a negligence action against Glenn on Joyce's behalf on July 2, 1981, just prior to the expiration of the applicable three-year statute of limitations. The District Court issued a summons on July 2, 1981, the same day that Garnaas filed the complaint. It is undisputed that Garnaas never served the summons and complaint upon the defendant, and thereby failed to comply with the provisions of Rule 41(e), M.R.Civ.P., which mandate that a defendant be served with a summons within three years of its issuance. On January 13, 1993, the District Court issued an order advising that Joyce's action would "be dismissed without prejudice twenty (20) days from the date of this Order unless further pleadings are filed with the Clerk of Court." Garnaas filed no further pleadings in this case.

¶ 4 Joyce filed the present suit on October 24, 1995, alleging professional negligence on Garnaas's part in connection with the dismissal of his personal injury action against Glenn. In his complaint, Joyce asserted that Garnaas never told him "of his failure to serve the defendant," and instead "represented to Joyce that the case was proceeding and was being defended by the Garlington firm of Missoula, Montana." Joyce alleged he was damaged because Garnaas's negligence in the underlying suit has "forever precluded" him "from recovering damages for the injuries [he] suffered in the July 4, 1978 wreck."

¶ 5 Garnaas filed his answer on September 10, 1996. He later moved for permission to file an amended answer, asking that he be permitted to plead "as affirmative defenses the statute of limitations and the statute of repose applicable to allegations of attorney negligence." The District Court granted Garnaas's motion, and Garnaas filed an amended answer on March 18, 1997.

¶ 6 On March 24, 1997, Garnaas filed a motion for summary judgment on the grounds that the ten-year statute of repose for legal malpractice actions, codified at § 27-2-206, MCA, barred Joyce's suit. On December 2, 1997, the District Court issued an order granting Garnaas's motion for summary judgment. The District Court entered a judgment in Garnaas's favor on December 16, 1997, and ordered that Joyce's action be dismissed. Joyce filed his notice of appeal on December 31, 1997.

STANDARD OF REVIEW

¶ 7 This Court's standard of review in appeals from summary judgment rulings is de novo. See Treichel v. State Farm Mut. Auto. Ins. Co. (1997), 280 Mont. 443, 446, 930 P.2d 661, 663. (citing Motarie v. Northern Montana Joint Refuse Disposal Dist. (1995), 274 Mont. 239, 242, 907 P.2d 154, 156; Mead v. M.S.B., Inc. (1994), 264 Mont. 465, 470, 872 P.2d 782, 785). This Court reviews a summary judgment order entered pursuant to Rule 56, M.R.Civ.P., based on the same criteria applied by the district court. See Treichel, 280 Mont. at 446, 930 P.2d at 663 (citing Bruner v. Yellowstone County (1995), 272 Mont. 261, 264, 900 P.2d 901, 903).

In proving that summary judgment is appropriate:

The movant must demonstrate that no genuine issues of material fact exist. Once this has been accomplished, the burden then shifts to the non-moving party to prove, by more than mere denial and speculation, that a genuine issue does exist. Having determined that genuine issues of material fact do not exist, the court must then determine whether the moving party is entitled to judgment as a matter of law. [This Court] reviews the legal determinations made by the district court as to whether the court erred.

Bruner, 272 Mont. at 264-65, 900 P.2d at 903.

¶ 8 The "moving party has the burden of showing a complete absence of any genuine issue as to all facts considered material in light of the substantive principles that entitle the moving party to judgment as a matter of law and all reasonable inferences are to be drawn in favor of the party opposing summary judgment." Kolar v. Bergo (1996), 280 Mont. 262, 266, 929 P.2d 867, 869.

DISCUSSION

¶ 9 The sole issue raised on appeal is whether the District Court erred when it granted Garnaas's motion for summary judgment. Joyce assigns error to the District Court based on two theories. First, that the District Court erred when it concluded that the statute of repose for legal malpractice requires a dismissal of this action. Second, that the District Court erred when it determined that equity does not act to extend the statute of repose. We will address each theory accordingly.

Did the District Court err when it concluded that the statute of repose for legal malpractice requires a dismissal of this action?

¶ 10 On December 2, 1997, the District Court granted summary judgment in Garnaas's favor on the grounds that the ten-year statute of repose which governs actions for legal malpractice bars his action. The court recognized that Rule 41(e), M.R.Civ.P., requires that a summons be served upon a defendant within three years of the date the summons was issued, and observed that a summons had been issued in Joyce's personal injury suit on July 2, 1981. The court noted that Garnaas had failed to serve the summons upon Glenn within that three-year time period. Because Garnaas failed to serve the summons on or before July 2, 1984, the court reasoned, it was then that Joyce lost his cause of action against Glenn and "the statutes of limitation and repose, as set forth in MCA § 27-2-206, began to accrue as of July 3, 1984." The District Court determined that "[t]he present legal malpractice action was filed on October 24, 1995, which was eleven and one[-]third years after the legal malpractice action accrued based on the failure to timely serve the summons." The court thus concluded that Joyce's legal malpractice action had accrued on July 3, 1984, more than eleven years before he filed his complaint on October 24, 1995. Because more than ten years had passed between the time Joyce's cause of action had accrued and the filing of his complaint, the District Court concluded that the absolute bar imposed by the ten-year statute of repose contained in § 27-2-206, MCA, precluded Joyce from maintaining an action against Garnaas.

¶ 11 On appeal, Joyce argues that the District Court erred when it granted Garnaas's motion for summary judgment because he claims he acquired a second cause of action against Garnaas on July 4, 1994. Because of this second cause of action against Garnaas, Joyce claims that the District Court erred when it concluded that he failed to initiate his malpractice suit within the periods of limitation set forth in § 27-2-206, MCA. More specifically, Joyce asserts that he lost his personal injury cause of action against Glenn on July 2, 1984, and that his original cause of action against Garnaas for malpractice thus accrued on July 3, 1984. From that point forward, Joyce argues, Garnaas had a further duty, based on their fiduciary relationship, to inform Joyce that his cause of action against Glenn had been lost. Joyce contends that Garnaas breached that duty, however, and never told him of his failure to serve the summons. Joyce maintains that Garnaas affirmatively concealed his own negligence from Joyce because he "inquired of Garnaas on numerous occasions as to the progress of his lawsuit against Glenn," but Garnaas simply assured him his suit was ongoing and that further proceedings were pending. In short, Joyce claims that he has three distinct causes of action in his favor; one against Glenn and two against Garnaas.

¶ 12 The time within which an action for professional negligence against an attorney must be brought is set forth in § 27-2-206, MCA. That statute provides:

An action against an attorney licensed to practice law in Montana or a paralegal assistant or a legal intern employed by an attorney based upon the person's alleged professional negligent act or for error or omission in the person's practice must be commenced within 3 years after the plaintiff discovers or through the use of reasonable diligence should have discovered the act, error, or omission, whichever occurs last, but in no case may the action be commenced after 10 years from the date of the act, error, or omission.

The last phrase of the statute articulates the unconditional ten-year statute of repose. The act, error, or omission of which Joyce complains is that which "precluded [Joyce] from recovering damages for the injuries suffered in the July 4, 1978 wreck." The only act, error, or omission by Garnaas which could be said to have precluded Joyce from recovering damages was the failure to serve the summons and complaint within the three years allowed by Rule 41(e), M.R.Civ.P., on or before July 2, 1984. Therefore, we agree with...