Opinion
No. 111,174.
2015-03-13
Craig A. REINMUTH and Donna L. Huffman, Appellants, v. PRIDE NATIONAL INSURANCE COMPANY; Rio National Insurance Services, Inc.; Victoria Flores; Metcalf Auto Plaza, Inc.; and Accountable Finance, Inc.; Appellees, and Farm Bureau Property and Casualty Insurance Co., Intervenor/Appellee.
Appeal from Jefferson District Court; Philip L. Sieve, Judge.Donna L. Huffman, of The Law Office of Donna L. Huffman, of Oskaloosa, for appellants.Michael L. Hughes and Daniel L. Doyle, of Sanders, Warren & Russell, LLP, of Overland Park, for appellees Pride National Insurance Company and Victoria Flores.
Appeal from Jefferson District Court; Philip L. Sieve, Judge.
Donna L. Huffman, of The Law Office of Donna L. Huffman, of Oskaloosa, for appellants. Michael L. Hughes and Daniel L. Doyle, of Sanders, Warren & Russell, LLP, of Overland Park, for appellees Pride National Insurance Company and Victoria Flores.
Mark H. Epstein, of Roe & Epstein, LLP, of Kansas City, Missouri, for appellles Metcalf Auto Plaza, Inc., and Accountable Finance, Inc.
Kevin L. Bennett, of Bennett, Bodine & Waters, P.A., of Shawnee, for intervenor/appellee Farm Bureau Property and Casualty Insurance Company.
Before PIERRON, P.J., GREEN, J., and BURGESS, S.J.
MEMORANDUM OPINION
PER CURIAM.
Craig A. Reinmuth and Donna L. Huffman (Plaintiffs) filed a lawsuit against Pride National Insurance Company (Pride), Rio National Insurance Services, Inc. (Rio), Victoria Flores, Metcalf Auto Plaza, Inc. (MAP), and Accountable Finance, Inc. (AF) attempting to recover damages incurred by Plaintiffs after a vehicle owned by Huffman and driven by Reinmuth collided with a vehicle driven by Flores. The district court granted motions to dismiss all the defendants based on the petition. Plaintiffs appeal, arguing that the district court erred in dismissing all the claims against the defendants. Nevertheless, Plaintiffs have failed to show on appeal that the district court erred in granting the motions to dismiss and denying a motion for reconsideration. We affirm the district court.
Factual and Procedural Background
On April 27, 2011, a vehicle driven by Flores ran a red light and hit Huffman's vehicle, which Reinmuth was driving in Kansas City, Missouri. Reinmuth suffered permanent bodily injury because of the accident for which she continues to undergo medical treatment and endure pain, suffering, and mental anguish. Huffman's vehicle was determined to be a “total loss.”
On April 26, 2013, Plaintiffs filed a petition in Jefferson County District Court against Pride, Rio, Flores, MAP, and AF. In the petition, Plaintiffs first alleged “bad faith failure to pay” against Rio and Pride. As entitled “Count II,” Plaintiffs alleged “negligence & negligence per se,” but they then argued that Rio and Pride violated K.S.A. 40–2404, which relates to unfair competition or deceptive acts or practices of insurance companies. Plaintiffs alleged negligent entrustment claims against MAP and AF. Plaintiffs alleged violations of the Kansas Consumer Protection Act by Rio and MAP.
On August 14, 2013, MAP and AF filed a motion to dismiss for failure to state a claim upon which relief could be granted. MAP and AF argued that Plaintiffs' negligent entrustment cause of action failed because Plaintiffs failed to allege that Flores was incompetent or that MAP had knowledge of or reason to know that Flores was incompetent. MAP and AF also argued that Plaintiffs could not allege claims under the Kansas Consumer Protection Act against them because Plaintiffs did not allege in their petition that they consumed anything MAP or AF supplied.
On August 22, 2013, several motions were filed in the district court. Pride filed a motion to dismiss for lack of subject matter jurisdiction, arguing that any claims against it were precluded by the fact that the company was placed in receivership by a district court in Oklahoma. Flores filed a motion to dismiss for lack of personal jurisdiction and insufficient service of process. Huffman filed a certificate of service of the answer from Pride and Flores that they served to Plaintiffs on August 17, 2013. Pride and Flores, however, never filed the answer with the district court.
On September 10, 2013, Plaintiffs filed a motion they called “Motion to Strike Motion to Dismiss of Pride National.” In the body of the motion, Plaintiffs stated they were asking the district court to strike Flores' motion to dismiss. In the motion, Plaintiffs argued that Flores filed her motion to dismiss for lack of personal jurisdiction after she served Plaintiffs with an answer and that her motion to dismiss was impermissible under K.S.A.2014 Supp. 60–212. Plaintiffs also argued that the State Insurance Pool should be substituted for Pride in this case. The same day, Plaintiffs filed a motion titled as “Motion to Strike Motion to Dismiss of Flores.” In this motion, Plaintiffs again argued that Flores could not file a motion to dismiss after serving them with an answer. Plaintiffs also argued that there was personal jurisdiction over Flores. Finally, on September 10, Plaintiffs filed a “Motion to Amend Pleadings as to [MAP] and [AF]” and a “First Amended Petition Only as to Claims Against [MAP] and [AF].”
On September 11, 2013, Farm Bureau Property and Casualty Insurance Company (Farm Bureau) filed a motion to intervene in order to protect its rights as the uninsured or underinsured motorist insurance carrier on Huffman's vehicle.
The district court held a hearing October 16, 2013, to address the various motions. At the hearing, Huffman agreed that the district court should dismiss Pride because it was insolvent. The district court, therefore, sustained Pride's motion to dismiss. After hearing the parties' arguments, the district court also decided to sustain Flores' motion to dismiss because Jefferson County was not the proper venue for the lawsuit for the reasons stated in Flores' motion. The district court then made the specific finding that MAP and AF were not the owners of the car Flores was driving at the time of the accident. Furthermore, the district court determined that Plaintiffs did not properly plead negligent entrustment or a violation of the Kansas Consumer Protection Act, so the district court sustained MAP and AF's motion to dismiss. The district court filed an order permitting Farm Bureau to intervene.
On October 17, 2013, the district court filed a journal entry dismissing Pride based on Plaintiffs' voluntary dismissal of the claims against it. The district court also determined that after reviewing the file and hearing the arguments of counsel, it would grant Flores' motion to dismiss. The district court filed a separate journal entry on the motion to dismiss filed by MAP and AF. The district court again stated that after reviewing the file and hearing the arguments of counsel, it was sustaining MAP and AF's motion to dismiss.
On October 18, 2013, after Plaintiffs notified the parties and the district court of its intent to dismiss Rio with prejudice, the district court filed a journal entry dismissing Rio with prejudice.
On October 30, 2013, Plaintiffs filed a motion for reconsideration under K.S.A.2014 Supp. 60–260, in which Plaintiffs argued they had newly discovered information that proved MAP and/or AF owned the vehicle driven by Flores at the time of the accident. That same day, Plaintiffs also filed a motion titled “Premature Notice of Appeal.” MAP and AF filed suggestions in opposition to Plaintiffs' motion to reconsider or set aside. Flores also filed a memorandum in opposition to Plaintiffs' motion.
On November 13, 2013, Farm Bureau filed an answer “out of an abundance of caution” even though the district court had already dismissed all claims against everyone but Farm Bureau. On November 18, 2013, Farm Bureau filed a motion to dismiss, arguing that it was the only party remaining and Plaintiffs had not alleged a claim against Farm Bureau. Farm Bureau filed a proposed journal entry of dismissal with prejudice; but Plaintiffs objected to the journal entry, arguing among other things that the dismissal should not be with prejudice. On January 8, 2014, the district court filed the proposed journal entry dismissing Farm Bureau with prejudice and also overruled Plaintiffs' motion to reconsider or set aside. Plaintiffs timely filed a notice of appeal.
After the case was docketed, MAP and AF filed a motion with this court, asking this court to strike Plaintiffs' brief or in the alternative require Plaintiffs to make arguments that are more definite. The motions panel of this court denied the motion, stating that the panel that heard the appeal would decide the merits of the brief. Additionally, MAP/AF and Flores argue in their separately filed appellate briefs that Plaintiffs' brief fails to comply with the requirements in Supreme Court Rule 6.02 (2014 Kan. Ct. R. Annot. 40), in that the brief does not contain a concise statement of fact without argument, a citation to a standard of review, or references to the location in the record where issues on appeal were raised and ruled.
A review of Plaintiffs' brief reveals a statement of facts, at least one citation to a general standard of review, and citations to the record of places where at least some of the issues were raised and ruled on. Because of the contents of Plaintiffs' brief, some of the issues may not be properly raised or relevant, but Plaintiffs' brief does not appear to be so insufficient that this court should strike it.
Analysis
Did the district court err in granting Map/AF's motion to dismiss?
In their first issue, Plaintiffs argue that the district court erred in granting the motion to dismiss MAP and AF.
Whether a district court erred by granting a motion to dismiss for failure to state a claim is a question of law subject to unlimited review. On appeal, the appellate court views the well-pleaded facts in a light most favorable to the plaintiff and assumes as true those facts and any inferences reasonably drawn from them. If those facts and inferences state any claim upon which relief can be granted, then dismissal is improper. Cohen v. Battaglia, 296 Kan. 542, 545–46, 293 P.3d 752 (2013).
Plaintiffs argue that the district court erred when it made the erroneous finding of fact that neither MAP nor AF owned the vehicle. MAP and AF argue that whether they owned the vehicle was irrelevant to the district court's decision that Plaintiffs failed to state a claim against them.
Factual disputes cannot be resolved or decided on a motion to dismiss for failure to state a claim. Judges must exercise skepticism when a party moves to dismiss before discovery is complete. Kansas' notice pleading statutes do not intend the petition to govern the entire course of the case. Instead, the pretrial order contains the ultimate decision as to the legal issues and theories on which the case will be decided. Rector v. Tatham, 287 Kan. 230, 232, 196 P.3d 364 (2008).
At the end of the hearing on the parties' motions to dismiss, when announcing its decision on the motions, the district judge stated, “I make the specific finding that for purposes of the issues presented here that [MAP and AF] are not the owners of the car that was sold to Ms. Flores at the time this [accident] took place.” It appears that this was an improper finding to make at this stage of the litigation. Plaintiffs' petition alleged that both MAP and AF were registered owners of the vehicle at the time of the accident. The district judge specifically stated that he had not intended to turn the motion to dismiss into a summary judgment decision in any of his rulings. The district court should have decided whether dismissal was appropriate regardless of whether MAP or AF owned the vehicle.
Although MAP and AF do not concede that the district court's finding might have been premature, they are correct that ownership of the vehicle was irrelevant to the district court's ultimate ruling that the petition failed to allege any proper claims against them. The district judge ruled on this issue as follows: “I think neither the negligent entrustment nor Consumer Protection—neither one of those was properly-violation of the [Kansas] Consumer Protection Act was properly pled. And again, based upon those findings I find the—those two defendants['] motion to dismiss is also sustained.” Plaintiffs do not challenge this portion of the district court's finding on appeal. Accordingly, we affirm the district court's order granting MAP/AF's motion to dismiss.
Plaintiffs argue that the district court erred in ruling on MAP and AF's motion to dismiss without ever ruling on the motion to amend the pleadings. Plaintiffs claim they filed the amendment in response to MAP and AF's allegation that they did not own the vehicle. MAP and AF do not respond to Plaintiffs' argument regarding the district court's failure to consider the amended petition. Nevertheless, since the finding that neither MAP nor AF owned the vehicle did not affect the ultimate conclusion that Plaintiffs failed to state a claim, Plaintiffs' argument is ineffectual.
Did the district court abuse its discretion in denying the motion to reconsider or set aside the dismissal of MAP and AF?
Plaintiffs argue that the district court erred in denying their motion to reconsider or set aside the order of dismissal of claims against MAP and AF, and that the district court needed to reconsider its decision based on newly discovered evidence that supported Plaintiffs' position that MAP or AF owned the car. MAP and AF respond, arguing that the district court properly denied the motion to reconsider because the alleged newly discovered evidence was not relevant to the claims the district court dismissed.
Appellate courts apply an abuse of discretion standard of review for the denial of a motion to reconsider. Subway Restaurants, Inc. v. Kessler, 266 Kan. 433, 441, 970 P.2d 526 (1998) (stating that motions to alter or amend are reviewed for abuse of discretion); cert. denied 526 U.S. 1112 (1999); Exploration Place, Inc. v. Midwest Drywall Co., 277 Kan. 898, 900, 89 P.3d 536 (2004) (stating that Kansas motions to reconsider are generally treated as motions to alter or amend under K.S.A.2013 Supp. 60–259[f] ).
The newly discovered evidence Plaintiffs relied on to claim that the district court must reconsider its decision dismissing the claims against MAP/AF dealt with the issue of ownership of the car. As stated previously, ownership did not ultimately matter in granting the motion to dismiss. The district court, therefore, did not abuse its discretion in denying Plaintiffs' motion to reconsider.
Should the district court have denied Flores' motion to dismiss because Flores served an answer before she filed her motion to dismiss?
Plaintiffs argue that the district court erred in granting Flores' motion to dismiss because Flores served an answer to Plaintiffs' petition before she filed her motion to dismiss. Plaintiffs contend that according to K.S.A.2014 Supp. 60–212, the district court should not have considered Flores' motion to dismiss. Flores responds, arguing that she only inadvertently sent the answer to Huffman and that even if that answer was deemed filed, the answer included the defenses raised in her motion to dismiss, so dismissal was still proper.
Again, appellate courts have unlimited review over the question of whether a district court erred by granting a motion to dismiss for failure to state a claim. Cohen, 296 Kan. at 545–46. Additionally, interpretation of a statute is a question of law over which appellate courts have unlimited review. Cady v. Schroll, 298 Kan. 731, 734, 317 P.3d 90 (2014).
Flores never filed an answer in the district court. She did however send a copy of an answer to Huffman on August 14, 2013, before filing her motion to dismiss with the district court on August 22, 2013. Huffman filed Flores' answer along with a document notifying the district court that Flores had served Huffman with the answer.
Plaintiffs filed a motion to strike Flores' motion to dismiss arguing that under K.S.A.2014 Supp. 60–212(b) the motion was not allowed since Flores had already served an answer. Plaintiffs' argument on appeal is really that the district court erred in denying her motion to strike Flores' motion to dismiss under K.S.A.2014 Supp. 60–212. Plaintiffs argue that the plain language of K.S.A.2014 Supp. 60–212 states that once a party serves a responsive pleading that party cannot file a motion raising the defenses in K.S.A.2014 Supp. 60–212(b) instead. Therefore, Plaintiffs argue that since Flores served her answer by mailing it to Huffman, she was precluded from filing her motion to dismiss under K.S.A.2014 Supp. 60–212(b)(6). See K.S.A.2014 Supp. 60–205(b) (stating that service is complete upon mailing a paper to a person's last known address).
At the hearing on the motion to dismiss, Flores' counsel stated that his legal secretary had inadvertently sent a copy of the answer to Huffman but that someone from his office called Huffman and let her know that the secretary had mistakenly mailed the answer. After hearing the parties' arguments on the issue at this hearing, the district court found credible the argument of Flores' attorney that the answer was inadvertently sent to Huffman.
Plaintiffs do not challenge the district court's determination that Flores inadvertently mailed the answer to Huffman. Plaintiffs do not argue what affect that finding by the district court has on their argument that the motion to dismiss should be stricken. An issue not briefed by the appellant is deemed waived and abandoned. Superior Boiler Works, Inc. v. Kimball, 292 Kan. 885, 889, 259 P.3d 676 (2011). The district court did not err in denying Plaintiffs' motion to strike Flores' motion to dismiss. As this is the only argument advanced by Plaintiffs as to why the district court erred in granting of Flores' motion to dismiss, we find that the district court properly granted that motion.
Did the district court err in dismissing Farm Bureau with prejudice?
Plaintiffs' final argument is that the district court erred in dismissing Farm Bureau with prejudice. Since Plaintiffs agreed to Farm Bureau's dismissal from the case, it appears that Plaintiffs believed Farm Bureau should have been dismissed without prejudice. However, Plaintiffs do not provide a coherent argument as to why the district court's dismissal with prejudice was incorrect.
An appellate court has unlimited review over a district court's decision granting a motion to dismiss for failure to state a claim. Cohen, 296 Kan. at 545–46. Farm Bureau argues it was entitled to dismissal with prejudice because Plaintiffs' first amended petition did not state a claim against Farm Bureau. Farm Bureau argues that its dismissal was a dismissal on the merits under K.S.A.2014 Supp. 60–241 and therefore it was properly dismissed with prejudice.
Farm Bureau argues:
“A review of [P]laintiffs' Petition and First Amended Petition Only as to Metcalf Auto Plaza and Accountable Finance shows that both pleadings are rambling statements of alleged facts and ‘legal’ arguments that do not set forth a valid legal claim of any kind against Farm Bureau. There is no mention of Farm Bureau whatsoever in either Petition.”
Thus, Plaintiffs have not shown that the district court erred in dismissing Farm Bureau with prejudice.
Affirmed.