John R. Berding v. Menards, Inc. ( 2020 )

IN THE COURT OF APPEALS OF IOWA
No. 20-0078
Filed September 2, 2020
JOHN R. BERDING,
Plaintiff-Appellant,
vs.
MENARDS, INC.,
Defendant-Appellee.
________________________________________________________________
Appeal from the Iowa District Court for Cerro Gordo County, DeDra L.
Schroeder, Judge.
John Berding appeals from the dismissal of his petition. AFFIRMED.
William P. Baresel of Prichard Law Office, PC, Charles City, for appellant.
Paul J. Hammell and Kristine L. Britven, Eau Claire, Wisconsin, for appellee.
Considered by Bower, C.J., and Doyle and Schumacher, JJ.
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SCHUMACHER, Judge.
John Berding appeals from the dismissal of his petition based on failure to
comply with Iowa Rule of Civil Procedure 1.302(5). Berding argues the district
court erred by granting Menards, Inc.’s (Menards) motion to dismiss for failure to
serve the defendant within ninety days after the filing of his petition. Because we
agree with the district court’s determination that Berding failed to demonstrate
good cause in delaying service, we affirm the dismissal.
I. Facts and Prior Proceedings
The facts relevant to this appeal are uncomplicated. The alleged cause of
action arose on June 22, 2017, wherein Berding alleged negligence on the part of
Menards for leaving a low pallet jack in an aisle unattended, with no warnings to
customers, which caused injury to Berding as he shopped. On November 2, 2018,
the third-party claim administrator for Menards denied liability for the incident.
Berding’s counsel sent a letter to the insurance carrier eight months later on
June 7, 2019, alerting Menards of Berding’s intention to file a lawsuit. Berding’s
counsel, Brian McPhail, filed a petition on June 20, 2019.
Attorney Todd Prichard filed an appearance on behalf of Berding on
October 11, 2019, and filed an application to extend time for service on behalf of
Berding three days later, citing miscommunication between counsel as the basis
for good cause.1 This application was filed after the time to serve Menards had
expired. The court granted the motion but indicated that the order was “without
prejudice to the defendant to contest the court’s finding of good cause.” Following
1 Both Attorney McPhail and Attorney Prichard represent Berding.
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service of the original notice and petition on October 23, 2019, Menards moved to
dismiss for lack of good cause for the delay in service. After hearing on the motion
to dismiss, the district court found that the service of the petition was not timely
and there was not good cause established for the delay. The district court
dismissed the petition. Berding appeals.
II. Standard of Review
“We review decisions by the district court to grant a motion to dismiss for
correction of errors at law.” Rucker v. Taylor, 828 N.W.2d 595, 598 (Iowa 2013).
“Dismissal is proper ‘only if the petition shows no right of recovery under any state
of facts.’” Hawkeye Foodservice Distrib., Inc. v. Iowa Educators Corp., 812 N.W.2d
600, 604 (Iowa 2012) (quoting Southard v. Visa U.S.A. Inc., 734 N.W.2d 192, 194
(Iowa 2007)).
“Ordinarily, the pleadings in the case form the outer boundaries of the
material subject to evaluation in a motion to dismiss.” Rucker, 828 N.W.2d at 598.
However, if a party moves to dismiss on the basis of untimely service, “a court is
permitted to consider facts outside the pleadings.” Id. at 598–99. When the district
court makes findings of fact for such a motion to dismiss, “those findings ‘are
binding on appeal unless not supported by substantial evidence.’ We are not
bound, however, by either the legal conclusions or application of legal principles
reached by the district court.” Id. at 599 (quoting McCormick v. Meyer, 582 N.W.2d
141, 144 (Iowa 1998)).
III. Legal Analysis
Iowa Rule of Civil Procedure 1.302(5) governs the consequences for failure
to serve an original notice:
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If service of the original notice is not made upon the defendant,
respondent, or other party to be served within 90 days after filing the
petition, the court, upon motion or its own initiative after notice to the
party filing the petition, 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. 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.
For good cause to be shown, our case law establishes that “the plaintiff
must have taken some affirmative action to effectuate service of process upon the
defendant or have been prohibited, through no fault of his own, from taking such
an affirmative step.” Meier v. Senecaut, 641 N.W.2d 532, 542 (Iowa 2002) (quoting
Carroll v. Martir, 610 N.W.2d 850, 858 (Iowa 2000)). “Inadvertence, neglect,
misunderstanding, ignorance of the rule or its burden, or half-hearted attempts at
service have generally been waived as insufficient to show good cause.” Id.
Good cause is likely (but not always) to be found in the plaintiff’s
failure to complete service in a timely fashion is a result of the
conduct of a third party, typically the process server, the defendant
evaded service of process or engaged in misleading conduct, the
plaintiff has acted diligently in trying to effect service, or there are
understandable mitigating circumstances.
Wilson v. Ribbens, 678 N.W.2d 417, 421 (Iowa 2004) (quoting 4B Charles Alan
Wright & Arthur R. Miller, Federal Practice & Procedure § 1137 at 342 (3rd ed.
2002)).
A. Miscommunication between Counsel and Settlement Negotiations
Neither party asserts that Menards was served within the timeframe
prescribed in Iowa Rule of Civil Procedure 1.302(5). Berding instead argues that
good cause exists for this failure, as miscommunication between counsel and
settlement negotiations equate to good cause, and the district court erred in failing
to find good cause.
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In support of his argument for good cause, Berding relies on Duwa v.
Brooks, No. 08-2038, 2009 WL 5126140, at *3 (Iowa Ct. App. Dec. 30, 2009). In
such case, we found good cause for delay in service, finding that a third party, the
sheriff, delayed service and that the plaintiff had pursued a reasonable course of
action to effectuate service within ninety days. Duwa, 2009 WL 5126140, at *2.
However, Berding failed to take any affirmative steps to effectuate service.
As such, Berding’s position is similar to the litigant in Jones v. Busta, No. 14-0522,
2015 WL 162066, at *1 (Iowa Ct. App. Jan. 14, 2015). In Jones, the appellant
argued good cause “due to an omission from the manual calendar system to an
electronic calendar system the deadline was inadvertently removed from the
calendaring.” 2015 WL 162066, at *1. We held that as the appellant failed to take
affirmative steps to effectuate service, the court appropriately dismissed the case
for failure to serve within ninety days. Id. at *4. We find Berding’s actions do not
involve the failure of a third party, such as a process server. He failed to take any
affirmative action to serve Menards within the ninety-day timeframe.
Secondly, we do not find the fact the parties were engaged in settlement
negotiations constitutes good cause. As the supreme court has previously stated,
“[S]ettlement negotiations, even if done in good faith, do not constitute adequate
justification or good cause for delaying service.” Henry v. Shober, 566 N.W.2d
190, 193 (Iowa 1997).
Lastly, Berding argues Menards had notice of the lawsuit because of the
letter sent by Berding on June 7, 2019. Berding offers no precedence in support
of this argument and we reject the same, as notifying a litigant that they may be
served cannot equate to service under the Iowa Rules of Civil Procedure.
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B. Iowa Rule of Civil Procedure 1.309
For the first time on appeal, Berding argues that the district court erred in
voiding its previous order allowing an extension of time and failing to find prejudice
to Menards. Pursuant to Iowa Rule of Civil Procedure 1.309, a court “may allow
any process or proof of service thereof to be amended at any time in its discretion
and upon such terms as it deems just, unless it clearly appears that material
prejudice would result to the substantial rights of the party against whom the
process issued.”
Our preservation rules ensure district courts the opportunity to avoid or
correct errors. See State v. Pickett, 671 N.W.2d 866, 869 (Iowa 2003) (finding the
practice of casting fault on the district court for failing to rule correctly on an issue
as “fundamentally unfair” when the party did not give that court an opportunity to
fix its mistake). The preservation rules also prevent a party from “remain[ing]
silent . . . in the face of error . . . and subsequently assert[ing] error on appeal if the
outcome in the trial court is unfavorable.” Id. (citation omitted). Here, Berding did
not raise the same issue below that he advances on appeal. It is fundamentally
unfair to reach an argument advanced on appeal concerning Iowa Rule Civil
Procedure 1.309 because it was not properly presented to the district court. We
decline to address this argument.
IV. Conclusion
Berding did not serve Menards with notice of the lawsuit within ninety days
after the petition was filed and did not file a motion for an extension of time to serve
notice prior to the expiration of the ninety days. We conclude Berding has not
shown good cause for the delay in serving Menards, and we find unpreserved his
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argument under Iowa Rule of Civil Procedure 1.309. Accordingly, we affirm the
district court’s dismissal.
AFFIRMED.