McDowell v. Citicorp Inc.
| Citation | 2008 SD 50,752 N.W.2d 209 |
| Decision Date | 18 June 2008 |
| Docket Number | No. 24657-A-RWS.,24657-A-RWS. |
| Court | Supreme Court of South Dakota |
| Parties | Pamela McDOWELL, Plaintiff and Appellant, v. CITICORP INC., Citibank of South Dakota, N.A.; Crawford & Company, Defendants and Appellees. |
Chet Groseclose of Chet Groseclose, Prof. LLC, Sioux Falls, South Dakota, Attorney for appellant.
Lon J. Kouri, David A. Pfeifle of May & Johnson, PC Sioux Falls, South Dakota, Attorneys for appellees Citicorp/Citibank of SD, N.A.
Steven W. Sanford, Michael A. Henderson of Cadwell, Sanford, Deibert & Garry, LLP, Sioux Falls, South Dakota, Attorneys for appellee Crawford & Co.
[¶ 1.] Pamela McDowell appeals the circuit court's denial of her motion to amend her complaint to include pre-bankruptcy causes of action. We affirm.
[¶ 2.] This case begins in a workers' compensation case originating in December of 1991. As a result of her injury, McDowell entered into a settlement agreement with her employer's insurance adjustment firm, Crawford & Company (Crawford), who administered workers' compensation claims on behalf of her employer, Citibank/Citicorp (Citicorp).1 McDowell also brought a lawsuit alleging Citicorp had unreasonably delayed payments of her medical bills. She claimed the unreasonable delay in her payments constituted bad faith, intentional and negligent infliction of emotional distress, vexatious denial of claim, fraud, deceit and intentional interference with a business relationship.2
[¶ 3.] Citicorp moved for summary judgment. While the circuit court was considering the motion, Citicorp learned McDowell did not include these claims or list any health care provider, hospital/clinic or collection agency of either on her October 20, 2000 bankruptcy petition. Citicorp petitioned the circuit court to hold McDowell was judicially or equitably estopped from bringing those claims. A hearing was held on May 2, 2005 where the parties discussed the effect of failing to list the pre-bankruptcy claims on the bankruptcy schedule. During that hearing, McDowell repeatedly agreed that the pre-bankruptcy claims could not be brought. Therefore, she amended her complaint a second time (second amended complaint), this time only including claims alleging bad faith, intentional and negligent infliction of emotional distress, and punitive damages for post-bankruptcy conduct.
[¶ 4.] On June 6, 2005, the circuit court issued a memorandum decision that concluded McDowell was judicially estopped from asserting pre-bankruptcy claims. Citicorp was granted a partial summary judgment on the basis of judicial estoppel. Furthermore, the circuit court stayed the post-bankruptcy claims until a ruling could be obtained on her lawsuit to reopen her settlement agreement. Once the settlement agreement case had been decided the circuit court dismissed the bad faith claim, which allegedly arose from post-bankruptcy conduct and granted summary judgment in favor of Citicorp on the remaining claims (also post-bankruptcy conduct).
[¶ 5.] On October 18, 2005, an order for summary judgment in favor of Citicorp was entered along with a judgment of dismissal, which dismissed all McDowell's claims on the merits and with prejudice. McDowell reopened her bankruptcy case and added the pre-bankruptcy causes of action on November 21, 2005.3 On December 2, 2005, McDowell petitioned the circuit court, Judge Kean, to amend her second amended complaint in order to add the pre-bankruptcy claims. Less than two weeks later, before the circuit court ruled on the issue, McDowell filed a notice of appeal. This Court affirmed the judgment. See McDowell v. Citicorp, 2007 SD 53, 734 N.W.2d 14(McDowell II).4
[¶ 6.] On June 6, 2007, two months after McDowell II was issued, McDowell made a revised motion to amend her second amended complaint, which was denied by the circuit court. She appeals raising the following issues:
1. Whether the circuit court had jurisdiction to grant McDowell's motion to further amend her complaint.
2. Whether the circuit court erred when it denied McDowell's motion to amend her second amended complaint when the motion was filed two months after this Court had affirmed the dismissal of her complaint.
[¶ 7.] We review the decision denying plaintiff's request to amend pleadings under the abuse of discretion standard of review. Sejnoha v. City of Yankton, 2001 SD 22, ¶ 5, 622 N.W.2d 735, 737 (citing Tesch v. Tesch, 399 N.W.2d 880, 882 (S.D.1987)). "An abuse of discretion occurs when `discretion [is] exercised to an end or purpose not justified by, and clearly against, reason and evidence.'" In re Name Change of L.M.G., 2007 SD 83, ¶ 6, 738 N.W.2d 71, 73-74 (quoting Miller v. Jacobsen, 2006 SD 33, ¶ 18, 714 N.W.2d 69, 76).
[¶ 8.] 1. Whether the circuit court (Judge Kean) had jurisdiction to grant McDowell's motion to further amend her complaint while the case was on appeal.
[¶ 9.] McDowell claims Judge Kean erred in not allowing her to amend her second amended complaint, even though the case was on appeal. She argues that the circuit court retained jurisdiction to allow her to add the pre-bankruptcy claims even though the case was on appeal. First, Citicorp argues that Judge Kean did not have jurisdiction to allow an amendment to a complaint that was on appeal. Second, Citicorp claims this issue is not properly before this Court because McDowell did not appeal from the denial of the motion in front of Judge Kean, but has only appealed the denial of the revised motion to amend in front of Judge Srstka.
[¶ 10.] The record reflects that McDowell only appealed "the Order Denying Plaintiff's Revised Motion to Amend Second Amended Complaint rendered in this action on the 29th day of August 2007." Therefore, we do not consider whether Judge Kean had jurisdiction to allow McDowell to amend her complaint to include pre-bankruptcy claims while appealing the dismissal of her post-bankruptcy claims.
[¶ 11.] 2. Whether the circuit court erred when it denied McDowell's motion to amend her second amended complaint when the motion was filed two months after this Court had affirmed the dismissal of her complaint.
[¶ 12.] McDowell argues that Judge Srstka abused his discretion by denying her revised motion to amend her second amended complaint, even though all claims within the second amended complaint had been dismissed and that dismissal had been affirmed by this Court two months prior to submitting the revised motion. McDowell argues that under SDCL 15-6-15(a) "leave shall be freely given when justice so requires" and Citicorp has not demonstrated it would be unduly prejudiced by allowing her to amend her complaint. Therefore, McDowell claims she should have been allowed to amend her complaint.
[¶ 13.] Citicorp argues that SDCL 15-6-15(a) is inapplicable because McDowell did not move to amend her complaint until after the judgment of dismissal had been granted and affirmed. In essence, Citicorp argues that there is nothing to amend since all the claims in the second amended complaint have been dismissed. Citicorp alleges that McDowell was required to set aside the judgment before being allowed to amend.
[¶ 14.] While a search of our case law does not reveal a case on point, other jurisdictions have considered this issue. The Eighth Circuit Court of Appeals noted that "[a]lthough a pretrial motion for leave to amend one's complaint is to be liberally granted, different considerations apply to motions filed after dismissal." Dorn v. State Bank of Stella, 767 F.2d 442, 443 (8thCir.1985) (emphasis added).5 If a complaint is dismissed, "the right to amend under Fed.R.Civ.P. 15(a) [SDCL 15-6-15(a)] terminates." Id. (additional citation omitted). If the "dismissal of the complaint also constitutes dismissal of the action[,]" then the motion to amend is improper. Id. Other courts have held that once a judgment is entered, amending the pleadings cannot be allowed until the judgment is set aside or vacated. For example, in Laber v. Harvey, 438 F.3d 404 (4thCir.2006), the Fourth Circuit Court of Appeals explained that a court cannot deny a motion to amend only because it has entered judgment against the plaintiff, but the court cannot grant the post-judgment motion to amend unless the judgment is vacated pursuant to Rule 59(e) or 60(b). Id. at 427 . Also, the Second Circuit Court of Appeals has noted "[t]he merit of this approach is that `[t]o hold otherwise would enable the liberal amendment policy of Rule 15(a) to be employed in a way that is contrary to the philosophy favoring finality of judgments and the expeditious termination of litigation.'" Nat'l Petrochemical Co. of Iran v. M/T Stolt Sheaf, 930 F.2d 240, 245 (2d Cir.1991) (quoting 6 Wright, Miller & Kane, Federal Practice & Procedure Civil 2d § 1489, at 694 (1990)).
[¶ 15.] Therefore, there was no abuse of discretion in denying McDowell's revised motion to amend her second amended complaint after judgment of dismissal and summary judgment had been granted and affirmed. Essentially, there was no complaint left to amend. See Graham v. County of Washtenaw, 358 F.3d 377, 385 (6thCir.2004); Sparrow v. Heller, 116 F.3d 204, 206 (7thCir.1997). The denial of McDowell's motion is affirmed.
[¶ 16.] Furthermore, even if we were to consider SDCL 15-6-15(a) to be the standard, McDowell has not demonstrated that Judge Srstka abused his discretion by denying the motion to amend. When considering whether a party's motion to amend should be granted "the most...
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