Wagg v. Estate of Dunham

• Court: Washington Supreme Court
• Writing for the Court: IRELAND, J.
• Citation: Wagg v. Estate of Dunham, 42 P.3d 968, 146 Wash.2d 63 (Wash. 2002)
• Decision Date: 28 March 2002
• Docket Number: No. 71238-7.
• Parties: Greg WAGG, a single person, Respondent, v. ESTATE OF Bard A. DUNHAM, deceased; Thomas Benner, Personal Representative of the Estate of Bard A. Dunham, deceased, Petitioners.

42 P.3d 968

146 Wash.2d 63

Greg WAGG, a single person, Respondent, v. ESTATE OF Bard A. DUNHAM, deceased; Thomas Benner, Personal Representative of the Estate of Bard A. Dunham, deceased, Petitioners.

No. 71238-7.

Supreme Court of Washington, En Banc.

Argued February 12, 2002.

Decided March 28, 2002.

Jeffrey T. Sperline, Kennewick, for Petitioners. Jeffers, Danielson, Sonn & Aylward, James Myron Danielson, Kari D. Kube, Wenatchee, for Respondent.

IRELAND, J.

Petitioner Estate of Bard Dunham seeks review of a Court of Appeals' decision affirming summary judgment dismissal of a creditor's claim against the estate and reversing summary judgment dismissal of a personal injury action covered by the decedent's liability insurance policy. We find that a personal injury suit properly commenced within the statute of limitations, and which is to be satisfied solely from insurance proceeds, is controlled by former RCW 11.40.011 (1989)¹ and is not subject to a time limitation for the filing of a claim against the estate.

FACTS

On May 30, 1996, Bard Dunham and Greg Wagg were involved in a motor vehicle accident on Washington State Route 97. The accident caused Dunham's immediate death. Wagg survived, but claims he sustained severe personal injuries. Wagg alleges Dunham, a high school student, fell asleep while driving, crossed the center line of the road, and collided head-on with the dump truck Wagg was driving. Dunham died without a will. His vehicle was covered by an automobile liability insurance policy.

PROCEDURAL HISTORY

On February 12, 1999, pursuant to RCW 11.28.120,² Wagg filed a petition for letters of administration in Okanogan County, requesting the appointment of Thomas Benner as personal representative of the estate for the sole purpose of resolving Wagg's personal injury claims. On May 7, 1999, the court opened Dunham's estate and appointed Benner as personal representative.

On May 11, 1999, Wagg filed a personal injury lawsuit against the estate in Okanogan County Superior Court. Wagg mailed a copy of the summons and complaint to Dunham's parents on May 13, 1999, along with a letter advising them that his intent was to preserve the claim against the decedent's insurance company for the May 30, 1996 collision. Wagg served the summons and complaint on Benner, the personal representative, on May 18, 1999. Service was perfected when Benner acknowledged service on June 16, 1999.

In its answer to complaint, filed on June 28, 1999, the estate asserted an affirmative defense (among others) that Wagg was precluded from proceeding with his lawsuit due to his failure to properly serve a creditor's claim. Another affirmative defense claimed the suit was barred by the statute of limitations. In apparent response, Wagg served a creditor's claim on Benner on July 2, 1999. The claim description acknowledged that the "claim is contingent upon the outcome of ... Wagg v. Dunham," and that "[a]ny verdict would be recovered from insurance policy proceeds." Clerk's Papers at 24-25.

On September 15, 1999, the estate moved for summary judgment of dismissal of the personal injury suit. The estate argued that former RCW 11.40.080 (1994) required Wagg to file a creditor's claim before filing his lawsuit. Because he filed the suit prior to filing a creditor's claim, the estate claimed Wagg's service of the suit on the estate was premature, the filing was void and ineffective, and therefore, the suit was barred by the statute of limitations.

On October 6, 1999, Benner filed a notice to creditors with the county clerk's office as required under RCW 11.40.020. On October 18, 1999, Wagg filed a revised creditor's claim, which amended his earlier claim to request any applicable insurance policy proceeds available.

The trial court granted the estate's summary judgment motion against Wagg on April 10, 2000. Wagg filed a motion for reconsideration urging the trial court to reconsider his lawsuit and to limit claims therein to those available through the decedent's insurance policy. Wagg argued that if his creditor's claim against the estate failed, his personal injury suit should survive under the nonclaim statutes, former RCW 11.40.011 and RCW 11.42.030. The motion was denied on March 17, 2000.

Wagg timely appealed denial of the motion to reconsider to Division Three of the Court of Appeals. On review, the Court of Appeals affirmed dismissal of Wagg's creditor's claim against the estate, but reversed the dismissal of Wagg's personal injury action. Wagg v. Estate of Dunham, 107 Wash. App. 35, 37, 26 P.3d 287 (2001). The court held that the lawsuit was timely commenced within the statute of limitations, and "[s]o long as that lawsuit is limited to damages covered by Mr. Dunham's liability insurance, Mr. Wagg's service of a creditor's claim after filing the lawsuit in superior court does not bar litigation of the personal injury claim." Id. at 42, 26 P.3d 287.

ISSUE

Whether a personal injury action filed within the statute of limitations against a decedent's estate, which is to be satisfied solely from a decedent's liability or casualty insurance, is exempt from chapter 11.40 RCW creditor claims time requirements.

ANALYSIS

Standard of Review

The standard applied to review of a trial court's order granting summary judgment is de novo. CLEAN v. City of Spokane, 133 Wash.2d 455, 462, 947 P.2d 1169 (1997). Here, the material facts are undisputed by the parties; therefore, this case is "ripe for summary judgment." Young v. Estate of Snell, 134 Wash.2d 267, 271, 948 P.2d 1291 (1997). To determine whether summary judgment dismissal of the creditor's claims and the personal injury action was appropriate, all evidence and reasonable inferences are viewed in the light most favorable to the nonmoving party. Wilson v. Steinbach, 98 Wash.2d 434, 437, 656 P.2d 1030 (1982). If there is no genuine issue of material fact, and the moving party is entitled to judgment as a matter of law, summary judgment is appropriate. CR 56(c).

Under the facts of this case, a determination of whether the moving party is entitled to judgment as a matter of law depends on our interpretation of chapter 11.40 RCW. Because this inquiry requires us to engage in statutory construction, the standard of review is de novo. Cockle v. Dep't of Labor Indus., 142 Wash.2d 801, 807, 16 P.3d 583 (2001).

Provisions of Controlling Statutes

Statute of Limitations

RCW 4.16.080(2) specifies that personal injury claims are subject to a three-year statute of limitations. When parties seek to recover damages against a deceased person, RCW 4.16.200 specifies that "[l]imitations on actions against a person who dies before the expiration of the time otherwise limited for commencement thereof are as set forth in chapter 11.40 RCW."

Creditor's Claims—Against Estate

Chapter 11.40 RCW governs claims against estates. Former RCW 11.40.010 (1995),³ concerning notice to creditors, provides:

Every personal representative shall, after appointment and qualification, give a notice to the creditors of the deceased, stating such appointment and qualification as personal representative and requiring all persons having claims against the deceased to serve the same on the personal representative or the estate's attorney of record, and file an executed copy thereof with the clerk of the court, within four months after the date of the first publication of such notice described in this section or within four months after the date of the filing of the copy of such notice with the clerk of the court, whichever is the later, or within the time otherwise provided in RCW 11.40.013. The four-month time period after the later of the date of the first publication of the notice to creditors or the date of the filing of such notice with the clerk of the court is referred to in this chapter as the "four-month time limitation." Such notice shall be given as follows:

(1) The personal representative shall give actual notice, as provided in RCW 11.40.013, to such creditors who become known to the personal representative within such four-month time limitation;

. . . .

Except as otherwise provided in RCW 11.40.011 or 11.40.013, any claim not filed within the four-month time limitation shall be forever barred, if not already barred by any otherwise applicable statute of limitations. This bar is effective as to claims against both the decedent's probate assets and nonprobate assets as described in RCW 11.18.200.

(Emphasis added.)

Former RCW 11.40.014 (1989)⁴ provides:

Whether or not notice under RCW 11.40.010 has been given or should have been given, any person having a claim against the decedent who has not filed a claim within eighteen months from the date of the decedent's death shall be forever barred from making a claim against the decedent, or commencing an action against the decedent, if such claim or action is not already barred by any otherwise applicable statute of limitation[s]. However, this eighteen-month limitation does not apply (1) to claims described in RCW 11.40.011, (2) to any claims where the personal representative has not given the actual notice described in RCW 11.40.010(1) ... or (3) to any claims where no personal representative has been appointed within twelve months after the date of death.

(Emphasis added.)

Creditor's Claim—Insurance Proceeds

Where liability or casualty insurance is involved, former RCW 11.40.011 provides:

The time limitations under this chapter for serving and filing of claims shall not accrue to the benefit of any liability or casualty insurer as to claims against the deceased ... and such claims, subject to applicable statutes of limitation, may at any time be:

(1) Served on the personal representative, or the attorney for the estate;

. . . .

Claims may be served and filed as herein provided, notwithstanding the conclusion of any probate proceedings: PROVIDED, That the amount of recovery under such claims shall not exceed the amount of applicable insurance

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