Court Opinion

ID: 4205523
Source: CourtListenerOpinion
Date Created: 2017-09-22 17:02:35.117197+00
Date Added: 2024-06-11T14:41:29.221312
License: Public Domain

IN THE

    SUPREME COURT OF THE STATE OF ARIZONA
        DIANE M. FLYNN AND ROBERT FLYNN, WIFE AND HUSBAND
                        Plaintiffs/Appellants,

                                     v.

                           SARAH W. CAMPBELL,
                            Defendant/Appellee.

                            No. CV-16-0199-PR
                         Filed September 22, 2017

           Appeal from the Superior Court in Maricopa County
               The Honorable Thomas L. LeClaire, Judge
                          No. CV2014-055536
                    REVERSED AND REMANDED

              Opinion of the Court of Appeals, Division One
                        240 Ariz. 264 (App. 2016)
                               VACATED

COUNSEL:

Daryl Manhart, Melissa Iyer Julian (argued), Burch & Cracchiolo, P.A.,
Phoenix; and Thomas M. Richardson, Friedl & Richardson, Phoenix,
Attorneys for Diane Flynn and Robert Flynn

Jonathan P. Barnes, Jr., (argued), Jones, Skelton & Hochuli, P.L.C.,
Phoenix, Attorney for Sarah W. Campbell

Christopher Robbins, Hill, Hall & DeCiancio, PLC, Phoenix, Attorney for
Amicus Curiae Arizona Association of Defense Counsel

Stanley G. Feldman, Miller, Pitt, Feldman & McAnally, P.C., Tucson; and
David L. Abney, Ahwatukee Legal Office, P.C., Phoenix, Attorneys for
Amicus Curiae Arizona Association for Justice/Arizona Trial Lawyers
Association
                          FLYNN V. CAMPBELL
                           Opinion of the Court

JUSTICE LOPEZ authored the opinion of the Court, in which CHIEF
JUSTICE BALES, VICE CHIEF JUSTICE PELANDER, and JUSTICES
BRUTINEL, TIMMER, BOLICK and GOULD joined.

JUSTICE LOPEZ, opinion of the Court:

¶1            We hold that under Rule 15(c), Arizona Rules of Civil
Procedure, an amended complaint naming a new defendant relates back to
the original complaint if the newly added defendant knew or should have
known the plaintiff mistakenly failed to name him or her as a party in the
original complaint.

                             BACKGROUND

¶2            On October 17, 2012, Diane Flynn was injured in a car accident
with Sarah Campbell. At the accident scene, a police officer gave Flynn a
“crash report” that identified Campbell’s insurance carrier, State Farm
Mutual Automobile Insurance Company (“State Farm”), the policy
number, and the insurer’s phone number. Flynn later contacted State Farm
to report the accident.

¶3             On October 16, 2014, one day before the two-year statute of
limitations expired, Flynn, representing herself, sued State Farm. In her
complaint (“original complaint”), Flynn alleged that State Farm’s insured
caused the collision by “recklessness, carelessness, and negligence,” that
State Farm had “assumed full responsibility for its insured’s actions,” and
that it had “intentionally delayed, postponed, or otherwise disregarded the
resolution of this matter; at times providing false information to [Flynn],”
resulting in compensatory damages of $37,500 and requesting $200,000 in
punitive damages.

¶4              State Farm moved to dismiss the original complaint, arguing
Flynn did not have a cause of action because “in Arizona there is no right
of direct action against an insurance carrier for damages claimed as a result
of an accident with one of its insureds.” Before the superior court could
rule on the motion, Flynn retained counsel, and, on November 24, 2014,
filed an amended complaint removing State Farm, naming Campbell (and
several fictitious parties) as defendants, and alleging negligence.

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                          FLYNN V. CAMPBELL
                           Opinion of the Court

¶5            Campbell, on December 22, 2014—still within the period to
serve the original complaint and summons under Arizona Rule of Civil
Procedure 4(i)—moved to dismiss the amended complaint, arguing it did
“not ‘relate back’ under Rule 15(c)” and was therefore time-barred. The
superior court dismissed the amended complaint, finding Flynn
“committed a mistake of law [and] not a mistake of fact” because she was
“aware of the identity of the driver.” The court of appeals reversed, holding
Flynn’s mistake cognizable under Rule 15(c) as “a mistake concerning the
identity of the proper party.” Flynn v. Campbell, 240 Ariz. 264, 269 ¶ 18
(App. 2016).

¶6            We granted review because the standard for allowing
“relation back” of pleadings under Rule 15(c) presents a recurring issue of
statewide importance. We have jurisdiction under article 6, section 5(3) of
the Arizona Constitution and A.R.S. § 12-120.24.

                              DISCUSSION

             I.     Standard of Review

¶7             We review the interpretation of a rule of civil procedure de
novo. Pima Cty. v. Pima Cty. Law Enf’t Merit Sys. Council, 211 Ariz. 224, 227
¶ 13 (2005). A superior court, in analyzing a motion under Rule 15(c),
determines “through reference to the original complaint, analysis of
affidavits or other evidence submitted by the parties, and by applying
common sense” whether a cognizable mistake occurred, and the burden is
on the plaintiff to establish such a mistake. Tyman v. Hintz Concrete, Inc.,
214 Ariz. 73, 76–77 ¶ 22 (2006).

             II.    Arizona Rule of Civil Procedure 15(c)

¶8           Rule 15(c) provides:

     (c) Relation Back of Amendments. 1

1 We apply the 2017 version of Rule 15(c). See Ariz. R. Civ. P. 81(b)(2)(B)
(“Upon the effective date, a rule or amendment governs . . . proceedings
after that date in a pending action unless . . . the court determines that
applying the rule or amendment in a particular action would be infeasible
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                            FLYNN V. CAMPBELL
                             Opinion of the Court

     (1) Amendment Adding Claim or Defense. An amendment relates
     back to the date of the original pleading if the amendment
     asserts a claim or defense that arose out of the conduct,
     transaction, or occurrence set forth, or attempted to be set forth,
     in the original pleading.

     (2) Amendment Changing Party. An amendment changing the
     party against whom a claim is asserted relates back if:

        (A) Rule 15(c)(1) is satisfied; and

        (B) within the applicable limitations period—plus the period
        provided in Rule 4(i) for the service of the summons and
        complaint—the party to be brought in by amendment:

           (i) has received such notice of the institution of the action
           that it will not be prejudiced in maintaining a defense on
           the merits; and

           (ii) knew or should have known that, but for a mistake
           concerning the identity of the proper party, the action
           would have been brought against the party.

     (3) Service. Service of process in compliance with Rule 4.1(h), (i),
     or (j) satisfies Rule 15(c)(2)(B)(i) and (ii) with respect to the state,
     county, or municipal corporation—or any agency or officer of
     those entities—to be brought into the action as a defendant.

¶9            Arizona’s Rule 15(c) is modeled after its federal counterpart.
See Tyman, 214 Ariz. at 74 ¶ 9; see also In re Establishment of the Task Force on
the Ariz. Rules of Civil Procedure, Admin. Order No. 2014-116 (2014)
(establishing a task force to, among other things, “avoid unintended
variation from language in counterpart federal rules”). Although a federal
court’s interpretation of a federal procedural rule is “not binding in the

or work an injustice, in which event the former rule or procedure applies.”).
The relevant portions of the Rule are substantially similar to the former
version and any differences do not affect our analysis or conclusion.
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                           FLYNN V. CAMPBELL
                            Opinion of the Court

construction of our rule,” we recognize its instructive and persuasive value
and that “uniformity in interpretation of our rules and the federal rules is
highly desirable.” Orme Sch. v. Reeves, 166 Ariz. 301, 304 (1990). The only
difference between the two relevant Rule 15(c) subsections—Arizona Rule
15(c)(2)(B)(ii) and Federal Rule 15(c)(1)(C)(ii)—is the location of the
dependent clause “but for a mistake concerning the identity of the proper
party.”2 Because this difference does not create divergent meanings, the
federal courts’ interpretation of the federal rule is persuasive.

¶10            Rule 15(c)’s purpose is “to ameliorate the effect of the statute
of limitations.” Tyman, 214 Ariz. at 74 ¶ 9 (quoting 6A Charles Alan Wright,
Arthur R. Miller & Mary Kay Kane, Federal Practice and Procedure § 1497 (2d
ed. 1990) (describing Fed. R. Civ. P. 15(c))). In applying Rule 15(c),
however, we recognize that “[s]tatutes of limitations afford substantial
rights to prospective defendants,” including protection from stale claims
and uncertainty about potential unresolved claims. Ritchie v. Grand Canyon
Scenic Rides, 165 Ariz. 460, 464 (1990). We also interpret procedural rules
“to maximize the likelihood of a decision on the merits.” Allstate Ins. Co. v.
O’Toole, 182 Ariz. 284, 287 (1995) (citing Rule 1’s mandate to construe rules
in a “just” manner). Rule 15(c), as the United States Supreme Court has
succinctly explained, serves to “balance the interests of the defendant
protected by the statute of limitations with the preference . . . for resolving
disputes on their merits.” Krupski v. Costa Crociere S. p. A., 560 U.S. 538, 550
(2010).

¶11            Four conditions must exist for an amended complaint to
relate back under Rule 15(c): (1) the claim in the amended pleading “arose
out of the conduct, transaction, or occurrence” of the original pleading,
Ariz. R. Civ. P. 15(c)(1); (2) the party to be joined by amendment received
notice of the action within the applicable limitations period plus the time
for the service of the summons and original complaint, Ariz. R. Civ. P.
15(c)(2)(B); (3) the notice is sufficient to avoid prejudicing the joined
defendant’s ability to defend on the merits, Ariz. R. Civ. P. 15(c)(2)(B)(i);
and (4) within that same period, the party to be joined by amendment
“knew or should have known that, but for a mistake concerning the identity

2 Federal Rule 15(c)(1)(C)(ii) reads: “knew or should have known that the
action would have been brought against it, but for a mistake concerning the
proper party’s identity.”
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                          FLYNN V. CAMPBELL
                           Opinion of the Court

of the proper party,” plaintiff would have named the proper party in the
original complaint, Ariz. R. Civ. P. 15(c)(2)(B)(ii). Tyman, 214 Ariz. at 74–
75 ¶ 9.

¶12            Here, there is no dispute that Flynn’s amended complaint met
the first three requirements: (1) the amended complaint arose out of the
same car accident as the original complaint; (2) Campbell received actual
notice of the amended complaint within the applicable statute of limitations
plus the time for service of the summons and original complaint; and (3)
Campbell received sufficient notice to defend on the merits.

¶13           The central issue, thus, is whether Flynn’s decision to sue
State Farm rather than Campbell is cognizable under Rule 15(c)(2)(B)(ii):
first, whether Campbell knew or should have known that the action would
have been brought against her, but for a mistake concerning the identity of
the proper party; and second, whether Flynn’s decision to sue State Farm is
a mistake “concerning the identity of the proper party.”

¶14            Before we consider the merits, we reconsider our Rule 15(c)
approach in light of the United States Supreme Court’s decision in Krupski,
which post-dated our decision in Tyman by four years. The Court decided
Krupski “to resolve tension among the Circuits over the breadth of Rule
15(c)(1)(C)(ii)” regarding mistakes of law. Krupski, 560 U.S. at 546.

¶15           Campbell argues that the court of appeals, instead of relying
on Krupski, should have followed Tyman, which quoted Leonard v. Parry, 219
F.3d 25 (1st Cir. 2000), for the proposition that “a mistake of law by counsel
regarding whom to name in a lawsuit” is not a cognizable Rule 15(c)(2)
mistake. Tyman, 214 Ariz. at 76 ¶ 21 (internal quotation marks omitted). In
another court of appeals case, a concurring opinion urged this Court to
resolve the tension between Krupski and Tyman. See Sundevil Power
Holdings, LLC v. Ariz. Dep’t of Revenue, 240 Ariz. 339, 348–50 ¶¶ 32, 37, 40
(App. 2016) (Kessler, J., specially concurring).

¶16           We adopt Krupski’s Rule 15(c) analysis because it is more
consistent with the Rule’s text and purpose. Under this approach, we first
ask whether the defendant rather than the plaintiff knew or should have
known that, absent some mistake, the action would have been brought
against him or her. Krupski, 560 U.S. at 548. In this regard, we depart from

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                           FLYNN V. CAMPBELL
                            Opinion of the Court

Tyman in that we now focus our inquiry on the defendant rather than the
plaintiff. Compare id. (“Information in the plaintiff’s possession is relevant
only if it bears on the defendant’s understanding of whether the plaintiff
made a mistake regarding the proper party’s identity.”), with Tyman, 214
Ariz. at 76 ¶ 19 (“[W]hat the plaintiff knew (or thought he knew) at the time
of the original pleading generally is the relevant datum in respect to the
question of whether a mistake concerning identity actually took place.”
(internal quotation marks omitted)). We also reject Campbell’s claim that a
“mistake of law” does not qualify under Rule 15(c) and clarify that a
mistake—factual or legal—is cognizable under the Rule, if it is not “a
deliberate choice to sue one party instead of another while fully
understanding the factual and legal differences between the two parties.”
Krupski, 560 U.S. at 549. This approach comports with Rule 15(c)(2)(B)(ii)’s
text, which neither excludes legal mistakes nor distinguishes between types
of mistakes concerning the proper party’s identity. See Leonard, 219 F.3d
at 29 (noting that Rule 15(c) “does not distinguish among types of mistakes
concerning identity”). Accordingly, we overrule Tyman, and disapprove
Sundevil Power and O’Keefe v. Grenke, 170 Ariz. 460 (App. 1992), to the extent
they are inconsistent with our Rule 15(c) analysis here.

              III.   Campbell’s Knowledge

¶17            We begin our analysis by determining whether Campbell
knew or should have known that Flynn, but for her mistake regarding the
proper party, would have named Campbell as the defendant in her original
complaint. Ariz. R. Civ. P. 15(c)(2)(B)(ii); Krupski, 560 U.S. at 549. We assess
a defendant’s knowledge within the applicable limitations period—plus the
period provided in Rule 4(i) for the service of the summons and complaint.
See Krupski, 560 U.S. at 548. However, a prospective defendant’s mere
“[n]otice of the suit does not necessarily establish that knowledge.” O’Keefe,
170 Ariz. at 466.

¶18          In determining whether a Rule 15(c)(2) mistake exists, the
court must decide whether a plaintiff with accurate and complete
knowledge regarding the role and liability of the proper party would have
brought the action against that party. See Tyman, 214 Ariz. at 76 ¶ 19. “[I]t
would be error to conflate knowledge of a party’s existence with the
absence of mistake” because it is possible for a plaintiff to know about a
prospective defendant “while misunderstanding [its] role[]” in the event

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                           FLYNN V. CAMPBELL
                            Opinion of the Court

giving rise to her claim. Krupski, 560 U.S. at 548–49; see also Tyman, 214 Ariz.
at 76 ¶ 21 (“Lack of knowledge as to the appropriate defendant—as
opposed to a mistaken belief that a defendant is liable—does not constitute
a Rule 15(c)(2) mistake.”). Thus, a plaintiff’s confusion concerning a party’s
role in the “‘conduct, transaction, or occurrence’ giving rise to her claim”
constitutes a cognizable Rule 15(c) mistake. Krupski, 560 U.S. at 549.
“Information in the plaintiff’s possession is relevant only if it bears on the
defendant’s understanding of whether the plaintiff made a mistake
regarding the proper party’s identity.” Id. at 548. “The reasonableness of
the mistake is not itself at issue.” Id. at 549.

¶19            Here, Campbell argues that the amended complaint does not
relate back because she could have believed Flynn “strategically decided to
sue State Farm.” This argument is unpersuasive. First, the original
complaint exhibited Flynn’s mistaken belief that State Farm was the proper
defendant because it alleged State Farm had “assumed full responsibility”
to pay for damage to Flynn caused by Campbell, and it alleged both a claim
against State Farm and sought compensatory damages for injuries caused
by its insured. As the superior court noted, “it seems readily evident that
Plaintiffs wrongfully assumed they could sue the insurance company
because ultimately the insurance company paid the claim.” Second, Flynn’s
claim against State Farm for Campbell’s negligence was precluded as a
matter of law. See Nationwide Mut. Ins. Co. v. Ariz. Health Care Cost
Containment Sys., 166 Ariz. 514, 517 (App. 1990) (“[A]n injured person has
no direct cause of action against a tortfeasor’s insurance company.”).
Campbell has “articulated no strategy that [she] could reasonably have
thought [Flynn] was pursuing in suing a defendant that was legally unable
to provide relief,” at least with respect to her negligence claim. Krupski, 560
U.S. at 555 (reasoning that even if a plaintiff’s mistake is not reasonable, the
defendant still could understand that the plaintiff “harbor[s] a
misunderstanding about his status or role in the events giving rise to the
claim at issue and she may mistakenly choose to sue a different defendant
based on that misimpression”)

¶20          Campbell cannot credibly claim, under these circumstances,
that she was unaware that Flynn’s decision to sue State Farm was an
inadvertent legal error. Accordingly, we conclude on this record that
Campbell knew or should have known, for purposes of Rule 15(c)(2)(B)(ii),

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                          FLYNN V. CAMPBELL
                           Opinion of the Court

that Flynn would have sued her, but for Flynn’s mistake concerning the
proper party’s identity.

              III.   Mistake Concerning the Proper Party’s Identity

¶21          We next determine whether Flynn’s decision to sue State
Farm rather than Campbell is a cognizable mistake. See id. at 549. A
mistake—factual or legal—is cognizable under Rule 15(c) if it is not “a
deliberate choice to sue one party instead of another while fully
understanding the factual and legal differences between the two parties.”
Id.

¶22              “When the original complaint and the plaintiff's conduct
compel the conclusion that the failure to name the prospective defendant in
the original complaint was the result of a fully informed decision as
opposed to a mistake concerning the proper defendant's identity, the
requirements of Rule 15(c)(1)(C)(ii) are not met.” Id. at 552. Intentionally
suing one party instead of another “while fully understanding the factual
and legal differences between the two parties,” does not constitute a
mistake regarding the proper party’s identity. Id. at 549. Consequently, if
a plaintiff makes a deliberate choice to sue one party instead of another for
litigation advantage, however ill-advised and fairly characterized as legal
error, it is a strategic decision and is not cognizable under Rule 15(c) as a
mistake concerning the identity of a proper party. See Tyman, 214 Ariz. at
76–77 ¶¶ 21, 23 (holding plaintiff’s decision to sue fictitious defendants was
not cognizable under Rule 15(c) because it was not a mistake at all; she sued
them as placeholder defendants for the strategic purpose of tolling the
statute of limitations as she sought to identify the liable parties).

¶23            Here, Flynn erred by suing State Farm rather than Campbell
because the law precluded her negligence cause of action. See Nationwide
Mut. Ins. Co., 166 Ariz. at 517. Flynn’s suit against State Farm was clearly a
mistake, an action “proceeding from faulty judgment, inadequate
knowledge, or inattention.” Tyman, 214 Ariz. at 76 ¶ 19 (quoting Webster’s
Ninth New Collegiate Dictionary (1983)’s definition of mistake) (internal
quotation marks omitted). As we have discussed, supra ¶¶ 19–20, Campbell
was, or should have been, aware that Flynn would have sued her in the
original complaint, but for a mistake concerning the proper party’s identity.
Although Flynn may have intended to state a claim against State Farm,

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                          FLYNN V. CAMPBELL
                           Opinion of the Court

Flynn obviously misunderstood the legal significance of State Farm’s role.
Cf. Krupski, 560 U.S. at 543, 549 (finding a Rule 15(c) error where plaintiff
suffered an injury on a cruise ship and mistakenly sued the “sales and
marketing agent” for the cruise ship carrier rather than the carrier as the
responsible party). Also, in her original complaint Flynn named Campbell
as the driver who caused the accident. We conclude Flynn’s mistake falls
under Rule 15(c) because it was not a deliberate strategic decision, but
rather resulted from confusion concerning the correct party to sue. See id.,
560 U.S. at 549 (stating that a Rule 15(c) mistake occurs where a plaintiff
mistakenly chooses to sue a different defendant based upon a
misimpression of the defendant’s status or role in the events giving rise to
the claim); Tyman, 214 Ariz. at 76 ¶ 21 (acknowledging that a mistaken belief
that a defendant is liable constitutes a Rule 15(c)(2) mistake).

              IV.    Pro Se Status

¶24           Campbell argues that considering a pro se plaintiff’s status in
the Rule 15(c) context will nullify the statute of limitations for
unrepresented parties and create two different relation-back standards. We
disagree. We hold unrepresented litigants in Arizona to the same standards
as attorneys. Smith v. Rabb, 95 Ariz. 49, 53 (1963). Therefore, in applying
Rule 15(c), courts may not afford special leniency to pro se litigants.

¶25           A pro se litigant’s lack of legal knowledge, however, may be
relevant when assessing whether the plaintiff made a deliberate strategic
decision rather than a mistake concerning the identity of the proper party.
Ignorance of the law, while not an excuse for noncompliance with
procedural rules, may inform the question of whether an unrepresented
party made a cognizable Rule 15(c) mistake.

¶26            Under Rule 15(c), an amended complaint relates back to the
date of the original complaint only if all four of the Rule’s requirements are
met. Contrary to Campbell’s assertion, recognizing a pro se plaintiff’s
status will not allow plaintiffs to revive the strategy rejected in Tyman—
seeking to avoid the statute of limitations by suing parties they know are
not liable—because such deliberate, purposeful strategic decisions, whether
pursued by counsel or a pro se litigant, are not mistakes under Rule 15(c).
Cf. Barrow v. Wethersfield Police Dep’t, 66 F.3d 466, 469 (2d Cir. 1995)
(declining to apply relation back where pro se plaintiff “was not ‘mistaken’

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                          FLYNN V. CAMPBELL
                           Opinion of the Court

for purposes of rule 15(c)” because he disregarded the court’s instruction to
name proper defendants in amended complaint), modified, 74 F.3d 1366 (2d
Cir. 1996). A prospective defendant, however, “who understood, or who
should have understood, that he escaped suit during the limitations period
only because the plaintiff misunderstood a crucial fact about his identity”
is not entitled to a windfall repose. Krupski, 560 U.S. at 550. This approach
advances the policy underlying Rule 15(c) and comports with Rule 15(a)(2),
which allows parties to amend pleadings “when justice requires.” Ariz. R.
Civ. P. 15(a)(2) (“Leave to amend must be freely given when justice
requires.”).      These procedural safeguards appropriately balance
defendants’ legitimate interests in repose with our strong preference for
merits determinations.

                              CONCLUSION

¶27           We vacate the court of appeals’ opinion and reverse the
superior court’s order dismissing Flynn’s complaint. We remand to that
court for further proceedings consistent with this opinion.

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