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Buckner v. Great Southern Bancorp, Inc.

Court of Appeals of Iowa

January 9, 2019

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

          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.


         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 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]

          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 ...

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