Opinion ID: 1678589
Heading Depth: 2
Heading Rank: 2

Heading: CLM's claims against UNB as asserted by Gilbert as assignee.

Text: On June 6, 1986, Gilbert filed a second amended complaint against UNB. In addition to restating Gilbert's two individual claims, this complaint alleged the two CLM claims assigned to Gilbert, which had been dismissed. Gilbert also alleged that UNB was negligent toward CLM in handling the account of CLM, its depositor. This claim was not previously asserted by CLM. On July 10, 1986, UNB moved for summary judgment on the second amended complaint based on the doctrine of collateral estoppel. No issues of material fact were claimed or raised with respect to these assigned CLM claims. The trial court granted UNB's motion on the basis of collateral estoppel. Gilbert argues that the court improperly granted summary judgment on the CLM claims assigned to and asserted by Gilbert based on collateral estoppel. For reasons stated below, Gilbert is correct as to collateral estoppel. However, as assignee, Gilbert holds no better claim than that held by CLM. As a general rule [an assignee] takes the subject of the assignment with all the rights and remedies possessed by or available to the assignor, and a claim good in the hands of an assignor which is good against the original debtor is ordinarily equally good and free from defenses in the hands of his assignee.... In an action on the claim assigned, the assignee is ordinarily subject to any setoff or counterclaim available to the obligor against the assignor and to all other defenses and equities which could have been asserted against the [claim] in the hands of the assignor at the time of the assignment. (footnotes omitted). 6 Am.Jur.2d Assignments § 102 (1963). Though Gilbert asserts that UNB was negligent in handling CLM's account, CLM failed to assert negligence against UNB in its 1982 cross-claim or at any other time. CLM's causes of action against UNB, including any claim of negligence, arose in 1979, and would be subject to the six-year limitation period under SDCL 15-2-13, or the shorter three-year limitation period under SDCL 15-2-14. UNB's motion for summary judgment or dismissal asserted that any purported claims ... would be time barred by the statute of limitations. This motion was sufficient to challenge any claim of negligence. Therefore, CLM's negligence claim is barred for failing to plead it within the above limitation periods. The claims asserted in CLM's 1982 cross-claim would also be subject to the court's determination of UNB's motion for summary judgment or dismissal. CLM assigned its claims to Gilbert prior to the trial court's dismissal of CLM's cross-claims. However, SDCL 15-6-41(b) provides that For failure of the plaintiff to prosecute... a defendant may move for dismissal of an action or of any claim against him. (emphasis added). The record is clear that the trial court intended to dismiss all of CLM's claims for failure to prosecute. The assignment to Gilbert did not correct four years of inactivity by CLM and Gilbert takes the assignment with no better claim than held by CLM. 6 Am.Jur.2d Assignments, supra. Gilbert's counsel was present at the hearing and resisted the dismissal of CLM's claims. In addition, insufficient time elapsed after the assignment to permit any new activity by Gilbert's counsel to resurrect the claims. Schwartzle v. Austin Co., 429 N.W.2d 69 (S.D.1988); Holmoe v. Reuss, 403 N.W.2d 30 (S.D.1987); Duncan v. Pennington Co. Housing Auth., 382 N.W.2d 425 (S.D.1986). As indicated above, the trial court was incorrect in using collateral estoppel as the reason for granting summary judgment because: 1) the issues were not identical; 2) the original dismissals were based on failure to prosecute rather than on the merits of the causes of action; and 3) at the time of the original dismissals CLM's claims were already owned by Gilbert, not CLM. Cook v. Rezek, 296 N.W.2d 731 (S.D.1980). CLM's claims, though assigned, were subject to dismissal for lack of prosecution and inactivity, just as any negligence claim was time barred, whether in the hands of CLM or Gilbert. Holmoe, supra ; Duncan, supra . Thus, the trial court was correct in granting UNB's summary judgment motion on Gilbert's claims as assignee of CLM. We will not reverse where the trial court reached the correct result, though based on the wrong reason. Cook, supra; Uken v. Sloat, 296 N.W.2d 540 (S.D.1980); Owens v. City of Beresford, 87 S.D. 8, 201 N.W.2d 890 (1972).