Court Opinion

ID: 4357233
Source: CourtListenerOpinion
Date Created: 2019-01-09 17:06:56.623425+00
Date Added: 2024-06-11T13:28:53.872277
License: Public Domain

IN THE COURT OF APPEALS OF IOWA

                                   No. 18-0473
                              Filed January 9, 2019

JUDITH K. BUCKNER and MARK A. BUCKNER,
     Plaintiffs-Appellees,

vs.

GREAT SOUTHERN BANCORP, INC., d/b/a GREAT SOUTHERN BANK, A
Missouri Corporation,
     Defendant-Appellant.
________________________________________________________________

      Appeal from the Iowa District Court for Scott County, Henry W. Latham II,

Judge.

      In this interlocutory appeal, the defendants challenge the district court’s

denial of a pre-answer motion to dismiss the plaintiffs’ personal-injury action for

failure to serve process. REVERSED AND REMANDED.

      J. Scott Bardole of Andersen & Associates, West Des Moines, for appellant.

      Emilie Roth Richardson of Roth Law Office, PC, Dubuque, for appellee.

      Considered by Vogel, P.J., and Vaitheswaran and McDonald, JJ.
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VAITHESWARAN, Judge.

       Iowa Rule of Civil Procedure 1.302(5) requires a plaintiff to serve a

defendant with an original notice of the filing of a petition “within 90 days after” the

filing. If service is not made within this time frame, the district court “shall dismiss

the action without prejudice as to that defendant, respondent, or other party to be

served or direct an alternate time or manner of service.” Iowa R. Civ. P. 1.302(5).

“If the party filing the papers shows good cause for the failure of service, the court

shall extend the time for service for an appropriate period.” Id.

       Judith and Mark Buckner filed a personal injury action against Great

Southern Bancorp, Inc., d/b/a Great Southern Bank (“Great Southern”) on

September 18, 2017. The final day for timely service on Great Southern was

December 17, 2017.       On January 19, 2018—over a month after the service

deadline expired—the Buckners moved for an extension of time to serve Great

Southern. They asserted, “Before and after filing the Petition at Law, Plaintiffs

engaged in settlement discussions with Defendant’s insurance adjuster [but] the

negotiations were terminated by the insurance company on January 18, 2018.”

They claimed there was good cause to grant additional time and requested at least

“an additional thirty (30) days to complete service.” The district court summarily

granted the motion and gave the Buckners thirty days to serve Great Southern.

Service was completed within that time frame.

       Great Southern moved to dismiss the petition, citing the Buckners’ failure to

complete service within ninety days, as required by rule 1.302(5). Great Southern

also disputed the Buckners’ assertion of ongoing settlement negotiations. The

Buckners resisted the motion. They relied on the court order granting them an
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extension of time to serve the original notice. In their view, “[t]here was good cause

for the court to grant their motion to extend the time for service.” The district court

denied the motion to dismiss. The court reasoned that the Buckners “obtain[ed]

an order from the court allowing an extension of time to serve the defendant” and

there was “no prejudice to the defendant.”

       The Iowa Supreme Court granted Great Southern’s application for

interlocutory appeal and stayed further district court proceedings. The appeal was

transferred to this court for disposition.

       Great Southern contends the Buckners lacked good cause for late service

of the petition. The Buckners reiterate that the order extending the time for service

afforded them good cause for late service.

       Good cause turns on “all the surrounding circumstances, including

circumstances that would make it inequitable for a defendant to successfully move

to dismiss.” Rucker v. Taylor, 828 N.W.2d 595, 601 (Iowa 2013). Notwithstanding

the reference to equity, our review of the order denying the motion to dismiss is for

errors of law. Id. at 598. In evaluating the court’s ruling, the critical question is

whether the prior order extending time for service warranted denial of the motion

to dismiss.1

1
  Although Great Southern did not appeal the extension order, the order was central to its
dismissal motion and the Buckners’ resistance and was the primary rationale behind the
district court’s denial of the dismissal motion. Accordingly, we may review the extension
order. See Carroll v. Martir, 610 N.W.2d 850, 857 (Iowa 2000) (“The defendants correctly
assert that the district court was not prohibited from revisiting its earlier determination that
justification existed for the delay of service in this case. The authority to do so is
particularly appropriate in circumstances in which, as here, the initial ruling is made ex
parte. Simply put, it would seem appropriate for a court to revisit a prior ex parte ruling
once all the relevant parties are before it.”); Feldhacker v. West, No. 12-2003, 2013 WL
3855694, at *4 (Iowa Ct. App. July 24, 2013) (“Because both rulings centered on the rule
1.302(5) good cause issue, we believe plaintiffs’ motion to extend and West’s motion to
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        The extension motion precipitating the extension order was unquestionably

untimely. See Meier v. Senecaut, 641 N.W.2d 532, 543 (Iowa 2002) (stating rule

“requires the plaintiff to take affirmative action to obtain an extension or directions

from the court if service cannot be accomplished”); Oetken v. Guerrero, No. 07-

2091, 2008 WL 4308134, at *2 (Iowa Ct. App. Sept. 17, 2008) (presupposing

“timely motion for extension of [t]he service deadline”). And, as noted, Great

Southern disputed the reason asserted by the Buckners for seeking a belated

extension. Specifically, Great Southern attached an affidavit and documents to its

dismissal motion contesting the Buckners’ assertion that the parties were engaged

in settlement negotiations. See Rucker, 828 N.W.2d at 598–99 (stating while case

pleadings ordinarily form the outer boundaries of material to be evaluated in a

motion to dismiss, when the motion is based on failure to provide timely service, a

court may consider facts outside the pleadings).

       An employee of Great Southern’s insurer attested that the Buckners were

offered $5000 to settle the suit after it was filed but before Great Southern was

served.2 Days after the offer was made, the Buckners requested and obtained

video footage of the accident.      The insurer had “no further contact with” the

Buckners’ attorney until January 18, 2018, when counsel informed the insurer the

Buckners rejected the $5000 offer. One day later, the Buckners filed their motion

to extend the time for service of process. In short, Great Southern asserted there

dismiss present two sides to the same coin for error preservation purposes. After the
court’s good cause finding, West revisited the issue through his motion to dismiss, which
was ruled on by the district court.”).
2 The fact Great Southern knew of the lawsuit is irrelevant. See Henry v. Shober, 566

N.W.2d 190, 192 (Iowa 1997); accord Rucker, 828 N.W.2d at 603.
                                         5

were no ongoing settlement negotiations that might have prompted the Buckners

to delay service.

       Notably, the Buckners agreed with the facts as outlined in the insurer’s

affidavit. In their resistance to Great Southern’s motion to dismiss, they stated,

“The adjuster made a settlement offer right after the case was filed.” And they

stated, “On or about January 18, 2018, Plaintiffs rejected the settlement offer and

requested to resolve the matter. Then the adjuster stated since there was no

service completed any offers were off the table. Plaintiffs then immediately moved

the court for additional time to serve Defendants.” (Emphasis added.) Although

the Buckners asserted the insurer “kept communicating with the Plaintiffs’ attorney

by providing information relevant to the claim even after suit was filed,” they did

not explain why they allowed the ninety-day service period prescribed by rule

1.302(5) to expire before rejecting the $5000 settlement offer.

       We conclude the order extending the time for service was not supported by

good cause. See Henry, 566 N.W.2d at 193 (concluding “settlement negotiations,

even if done in good faith, do not constitute adequate justification or good cause

for delaying service”), superseded by rule as recognized in Dickens v. Associated

Anesthesiologists, P.C., 709 N.W.2d 122, 127 (Iowa 2006); but cf. Rucker, 828

N.W.2d at 603 (“[T]he action by the insurance representative in this case in

continuing to negotiate with Rucker’s attorney with knowledge that Rucker did not

plan to timely serve the petition made it inequitable for the Taylors to subsequently

seek dismissal of the case . . . .”); Wilson v. Ribbens, 678 N.W.2d 417, 418 (Iowa

2004) (concluding “the district court erred in failing to correctly recognize that an

agreement not to effect timely service may constitute ‘good cause’ for failing to
                                          6

effect service within the ninety-day period required by the rules of civil procedure”

(emphasis added)); Feldhacker, 2013 WL 3855694, at *5–6 (concluding the totality

of the circumstances supported the district court’s finding of good cause where the

parties were engaged in ongoing settlement negotiations, the plaintiffs had

difficulty gathering medical evidence, and the plaintiffs made unsuccessful efforts

to serve notice within the final days of the ninety-day deadline). We further

conclude that, because the extension order was unsupported by good cause, it

could not serve as the basis for denying Great Southern’s motion to dismiss.

       Nor are we persuaded that the denial of the dismissal motion may be

affirmed on the ground that Great Southern suffered no prejudice by the late

service. As the Iowa Supreme Court stated in Henry, “Even if State Farm had

actual knowledge that a petition would be filed or was filed, or it was not prejudiced

by the delay in service, Iowa Rule of Civil Procedure [1.302(5)] still requires service

of an original notice and petition upon the defendant.” 566 N.W.2d at 192.

       We reverse the order denying Great Southern’s motion to dismiss and

remand for dismissal of the petition.

       REVERSED AND REMANDED.