Court Opinion

ID: 6478138
Source: CourtListenerOpinion
Date Created: 2022-06-26 22:47:07.01488+00
Date Added: 2024-06-11T15:54:03.387121
License: Public Domain

CORCORAN, Supreme Court Justice,
dissenting:
I respectfully dissent from the court’s opinion. Rule 17(a), Arizona Rules of Civil Procedure, provides:
No action shall be dismissed on the ground that it is not prosecuted in the name of the real party in interest until a reasonable time has been allowed after objection for ... joinder or substitution of, the real party in interest____
In addition, rule 15(a) provides:
Leave to amend [a pleading] shall be freely given when justice requires.
Although the right to amend is not automatic, a denial of a motion to amend is justified only by “ ‘undue’ delay, bad faith, dilatory motive, repeated failure to cure deficiencies by previous amendments or undue prejudice to the opposing party.” Owen v. Superior Court, 133 Ariz. 75, 79, 649 P.2d 278, 282 (1982); see also Foman v. Davis, 371 U.S. 178, 182, 83 S.Ct. 227, 230, 9 L.Ed.2d 222, 226 (1962). “Prejudice” to an opposing party “is not that occasioned by defeat on the merits, but rather the inconvenience and delay suffered when the amendment raises new issues or inserts new parties into the litigation.” Romo v. Reyes, 26 Ariz.App. 374, 376, 548 P.2d 1186, 1188 (1976).
Permitting the plaintiff to amend her complaint to add the insurance carrier as a real party in interest would neither raise new issues nor unduly prejudice Toshiba. I believe the trial corut abused its discretion in denying the plaintiff’s motion for leave to file an amended complaint.
If the plaintiff had been permitted to amend her complaint to name the insurance carrier as real party in interest, this amendment would have related back to the time the original complaint was filed. Rule 15(c); see Dunn v. Progress Indus., Inc., 153 Ariz. 62, 65, 734 P.2d 604, 607 (App.1986) (Froeb, J., specially concurring). We have previously stated:
[A] change in parties should relate back (a) where the claim amended arises out of the same transaction or occurrence described in the original pleading, (b) where because the defendant has had ample notice of the nature of the claim being asserted, there is no prejudice in the ability of the defendant to defend that amended complaint on the merits, and (c) where the initial failure to designate the appropriate party was the product of a mistake.
Watts v. State, 115 Ariz. 545, 547-48, 566 P.2d 693, 695 (App.1977). All 3 conditions would be satisfied in this case. Additionally, rule 17(a) provides that joinder or substitution of the real party in interest “shall have the same effect as if the action had been commenced in the name of the real party in interest.”
The majority concludes that the insurance carrier no longer had an interest in the claim and therefore was not the real party in interest and could not be a party plaintiff because it had reassigned its claim to plaintiff before she filed her motion to amend. However, as set forth in Stephens, an attempted reassignment of the claim, made after the statute of limitations has run, does not transfer ownership of the claim so as to confer standing on the injured worker; such a reassignment “is meaningless as to third parties” and “cannot alter the defenses or equities of a third party.” 127 Ariz. at 230, 619 P.2d at 739. Therefore, as far as Toshiba was concerned, the insurance carrier remained the real party in interest even after the reassignment. Thus, the trial court should *210have permitted plaintiff to amend her complaint to include the insurance carrier.
As we stated in Grim,
Stephens prevents the maintenance of an action only in those cases where the plaintiff has both failed to obtain a valid reassignment within the two-year limitations period, and where the plaintiff has failed to seek the joinder of the compensation provider as the real party in interest pursuant to rule 17(a). Stephens does not alter the operation of rules 15(c) and 17(a)____
154 Ariz. at 74, 740 P.2d at 495. Neither Stephens nor Grim precludes plaintiff from maintaining her action against Toshiba.
Based on the foregoing analysis, I respectfully dissent.
NOTE: The Honorable ROBERT J. CORCORAN, Justice of the Arizona Supreme Court, has been authorized by Administrative Order No. 89-3 of the Chief Justice to participate in the resolution of this case which was previously assigned to him as a judge of this Court or to his department before Thursday, January 5, 1989.