Waldron v. Wilson , 532 N.E.2d 1154 ( 1989 )

PIVARNIK, Justice.

This cause comes to us on a petition to transfer from the Indiana Court of Appeals, Second District. Petition is brought by Plaintiff-Appellant Roger Eugene Wal-dron, who initially appealed the denial of his motion to amend his complaint. He claimed that under Ind.R.Tr.P. 15(C) his amended proposed complaint related back to the date of the filing of his original complaint. The facts are accurately stated by the court of appeals as follows:

On October 14, 1980, Waldron was injured when he caught his foot in a corn drying auger while it was in operation on a farm located in Howard County, Indiana. On October 14, 1982, Waldron commenced this action against Max L. Wilson (Max) and Earl Wilson (Earl) [hereinafter collectively referred to as the Wilsons] for the negligent care and maintenance of the corn drying auger. The sheriff of Howard County served a summons and the complaint upon each of the Wilsons on October 15, 1982. The Wilsons filed an answer to the complaint on November 22, 1982. The answer contained an admission that the Wilsons owned the farming operation where Wal-dron was injured. However, on April 29, 1983, the Wilsons moved to amend their answer by asserting that the farming operation was in fact owned by Wilson Livestock Farms, Inc.

On May 17, 1983, Waldron moved to amend his complaint "to indicate that the farming operation at which the plaintiff was injured was owned by Wilson Livestock Farms, Inc., an Indiana corporation." Record at 27. Waldron's proposed amended complaint was identical to the original complaint except that Wilson Livestock Farms, Inc. was named additionally as a defendant in the caption. The trial court granted the Wil-sons' motion to amend their answer and denied Waldron's motion to amend his complaint on August 8, 1984. On May 17, 1985, Waldron moved for the trial court to reconsider its ruling on his previous motion to amend. This motion was denied by the trial court on September 24, 1985. The trial court explained "that if the party [Waldron] seeks to add by amendment did receiv [sic] notice, constructive or otherwise, such alleged notice came after the applicable statue [sic] of limitations had expired." Record at 42. The trial court determined that there was no just reason for delay and directed entry of judgment against Waldron as to Wilson Livestock Farms, Inc., pursuant to T.R. 54(B).

Additionally, certain facts were stipulated to by the parties. Max and Earl are father and son and were engaged in a farming operation continuously from 1955 to January 11, 1980. On January 11, 1980, Wilson Livestock Farms, Inc. (the Corporation) was incorporated. The Corporation carried on substantially the same farming business as the Wilsons had carried on before the incorporation. The Wilsons were employees and the sole shareholders of the Corporation. Earl was the president and director of the Corporation from its inception through August 18, 1983. Max was secretary-treasurer and a director of the Corporation from its inception through August 18, 19883. There were no other officers or directors during the same time period. In October, 1980, Max was resident agent of the Corporation.

The injury to Waldron took place on a farm owned and operated by the Corporation. The real estate was conveyed the Corporation on February 1, 1980. All the equipment used in the farming operation in 1980 was owned by the Corporation.

Although the Wilsons had knowledge of Waldron's injury within one hour from the time it happened, Waldron did not place the Wilsons on notice of his claim prior to filing his complaint. No summons or other notice was directed by Waldron to the Corporation prior to October 15, 1982 when the complaint was served. Meridian Mutual Insurance Company, the lability insurance carrier for Max, Earl, and the Corporation, was notified by American States Insurance Company, the workmen's compensation carrier for Waldron's employer, of its claim for subrogation. The letters, dated May 27, 1981 and July 12, 1982, referred to the insured as Max and Earl and made no mention of the Corporation as an insured.

The court of appeals found two issues were raised in the appeal:

1. Did Waldron pursue a timely appeal in this action?

2. Did the trial court err in denying Waldron's motion to amend?

The court of appeals found Waldron timely pursued his appeal and we summarily affirm the court of appeals opinion on that issue and adopt it as a part of this opinion. The court of appeals further affirmed the trial court in its denial of Waldron's motion to amend, citing this court's decision in Czarnecki v. Lear Siegler, Inc. (1984), Ind., 471 N.E.2d 299. It is our observation our holding in Czarnecki was contravened and accordingly we vacate the opinion of the court of appeals on this issue and reverse the trial court.

In Czarnecki, the complaint was filed August 31, 1977, one day before the statute of limitations had run. Summons and complaint were served on Hinson Cab Co. on September 2, 1977, clearly after the statute had run. Actually there was no Hinson Cab Co. but the manufacturer of the cab was Royal Industries, Inc., through its Hinson Division. Royal Industries merged into Lear Siegler, Inc., and in the same year the assets of the former Hinson Division of Royal Industries, Inc. were purchased by Hinson Manufacturing Company, Inc. Royal Industries, Inc. was not served and never received notice of the institution of the action. Five years after the accident, on September 12, 1980, a summons addressed to Hinson Cab Co. was served on Hinson Manufacturing Company, Inc. «This was the first notice of the action received by Hinson Manufacturing Company, Inc., or its predecessors, Lear Siegler Inc., and Hinson Division Royal Industries, Inc. This court held:

It is clear that Ind.R.Tr.P. 15(C) contemplates the newly named defendant will have received notice of the institution of the action such that he will not be prejudiced in maintaining his defense on the merits. It is equally clear the rule contemplates that such a defendant knew or should have known that but for a mistake concerning the identity of the proper party the action would have been brought against him. Rule 15(C) would relate back here if the summons addressed to Hinson Cab Company had actually been served on Royal Industries, Inc., Hinson Division, and Royal would therefore have been given notice that suit was being brought against the manufacturer of the cab, which, of course, was Royal, and that they were the intended target defendant even though misnamed by the summons served. An amended complaint served after the running of the statute of limitations which properly named Royal Industries, Inc., Hinson Division, as a defendant, would 'have related back under 15(C) because clearly they would have had notice of the institution of the action and would have known that but for a mistake of misnomer they were the intended target defendant.

Czarnecki, at 801.

T.R. 15(C)(1) does not require process or that a summons be served before the statute of limitations has expired. What is required is such notice of the institution of the action that the added defendant will not be prejudiced in maintaining his defense on the merits. In the instant case, Waldron filed his cause on October 14, 1982, the last day within the statute of limitations. The Wilsons received the complaint and summons on October 15, 1982; service would have been effective and proper had it not been for the misnomer. In fact, the Wil-sons raised no question about the service for three years,. Even though there was a misnomer, however, the newly named defendant clearly would have had notice the action was instituted and would have known, but for the misnomer, they were the intended target defendants. We also note the added defendant had notice the action was instituted before the statute had run. Meridian Mutual Insurance Company, the liability insurance carrier for Max, Earl, and the corporation, was notified by American States Insurance Company, the workmen's compensation carrier for Wal-dron's employer, of its claim for subrogation. This was done by letters dated May 27, 1981 and July 12, 1982. Thus the necessary parties were notified of the impending action. The trial court improperly denied Waldron's motion to amend. The trial court is in all other respects affirmed.

DeBRULER and GIVAN, JJ., concur. DICKSON, J., concurs with separate opinion in which PIVARNIK, J., concurs. SHEPARD, C.J., dissents with separate opinion.