WILLIAM KINDLE,
Individually and as President of the Rosebud Sioux Tribe; and Rosebud Sioux Tribe, Both as
a Governmental and Corporate Entity,
Plaintiffs,
v.
MORISSET, SCHLOSSER, AYER & JOZWIAK,
a Professional Service Corporation, and its Predecessor in Interest, Pirtle, Morisset,
Schlosser & Ayer; Mason D. Morisset, Both Individually and as a Member and Employee of
Morisset, Schlosser, Ayer & Jozwiak, a Professional Service Corporation and as a
Member and Employee of its Predecessor in Interest, Pirtle, Morisset, Schlosser &
Ayer, a Professional Service Corporation; K. Allison McGaw, Both Individually and as a
Member and Employee of Morisset, Schlosser, Ayer & Jozwiak, a professional service
corporation and as a member and employee of its predecessor in interest, Pirtle, Morisset,
Schlosser & Ayer, a professional service corporation; and Patricia A. Marks, both
individually and as a member and employee of Morisset, Schlosser, Ayer & Jozwiak, a
professional service corporation and as a member and employee of its predecessor in
interest, Pirtle, Morisset, Schlosser & Ayer, a professional service corporation,
Defendants.
[1999 DSD 13]
United States District Court
District of South Dakota
Central Division
CIV. 97-3009, 97-3013
MEMORANDUM OPINION
GRANTING MOTION FOR SUMMARY JUDGMENT
Kenneth R. Dewell, Jeffrey L. Viken
Viken, Viken, Pechota, Leach & Dewell, Rapid City, SD
Attorneys for Plaintiffs
Gene R. Bushnell, Patricia A. Meyers
Costello, Porter, Hill, Heisterkamp & Bushnell, Rapid City, SD
Attorneys for Defendants
Filed April 29, 1999.
Richard H. Battey, Senior District Judge
PROCEDURAL HISTORY
[¶1] This legal malpractice action emanates from representation provided by defendants (Morisset) to plaintiffs (Tribe) in a construction dispute with Val-USC § Construction. Morisset advised the Tribe not to attend an arbitration hearing, held in May 1991, based on Morisset's belief that the Tribe was protected by sovereign immunity. The Tribe did not attend the hearing. The arbitrator found for Val-USC § Construction. As a result, the Tribe sued Val-USC § in federal district court in the central division of South Dakota.
[¶2] The district court affirmed the arbitrator's award in an order dated March 5, 1997. On March 20, 1997, the Tribe sued Morisset in state and federal court, Civ #97-3009, alleging legal malpractice. The state court action was removed to federal court, Civ #97-3013, and consolidated with Civ #97-3009 on October 30, 1998.
[¶3] Concurrently, the Tribe appealed the district court's order affirming the arbitration award. All action in the consolidated malpractice claims was stayed pending the outcome of the Tribe's appeal. In two separate opinions the Eighth Circuit Court of Appeals held that the Tribe had waived sovereign immunity and affirmed the arbitration award. Rosebud Sioux Tribe v. Val-USC § Constr., 50 F3d 560 (8th Cir. 1995) and Val-USC § Constr. v. Rosebud Sioux Tribe, 146 F3d 573 (8th Cir. 1998).
[¶4] On January 29, 1999, Morisset moved for summary judgment in the malpractice action claiming that the statute of limitations had expired. (Docket #25, Defendant's Motion). The Tribe filed a response on February 16, 1999, asserting that the statute of limitations was tolled by the continuous representation doctrine. (Docket #30, Response).
[¶5] Jurisdiction is based upon diversity of citizenship under 28 USC § 1332 as Morisset is a Seattle, Washington concern and the Tribe is a resident of South Dakota.
FACTS
[¶6] The only issue in this motion is the applicability of South Dakota's three-year statute of limitations for legal malpractice claims. The facts surrounding this issue are not in dispute. The following is a chronology of the relevant contacts between the two parties:
April 1991 - Morisset advised the Tribe not to attend an arbitration hearing.
January, 31, 1994 - Morisset informed the Tribe that unless payment for services was received by February 4, 1994, Morisset would withdraw. Defendants' Statement of Material Facts (Defendants' Facts) at 2; Plaintiffs' Statement of Material Facts (Plaintiffs' Facts) at 2.
February 16, 1994 - the Tribe passed resolution No. 94-40 instructing Morisset "to withdraw as counsel" in the pending cases. Attachment 2 to Requests for Admissions.
February 17, 1994 - Morisset appeared on behalf of the Tribe in a telephonic conference in Civ. 91-3019. Plaintiffs' Facts at 3.
February 18, 1994 - Morisset filed a motion for dismissal on behalf of the Tribe in Civ. #91-3019. Id.
February 22, 1994 - Kindle signed a declaration filed in Civ. #91-3019 affirming that Morisset had not been paid. Defendants' Facts at 3.
February 25, 1994 - notice of withdrawal of Morisset filed with court. Plaintiff's Facts at 5. On the same day, the district court granted the motion to withdraw which was reflected in the clerk's minutes. Defendants' Facts at 3. However, the clerk's minutes also noted that the "Final order dismissing this case will not be signed until March 29, 1994." Plaintiffs' Facts at 6.
February 28, 1994 - the Tribe received a letter dated February 23, 1994, from Morisset notifying the Tribe that it should obtain other counsel for possible future appeals and actions. Plaintiffs' Facts at 3-4.
March 1, 1994 - letter from Morisset to the Tribe noting that the motion to withdraw had been granted. Defendants' Facts at 3.
March 29, 1994 - district court issued a written order granting Morisset's motion to withdraw. Id.
March 20, 1997 - Morisset served with summons and complaint in this action.
[¶7] The Tribe offers the following additional facts from February - June 1994:
February 28, 1994 - bill from Morisset for 0.4 hours to "Prepare short report to Council." Plaintiffs' Facts at 6.
April 4, 1994 - the Tribe received billing statement for March 1994. Id.
April 6, 1994 - Morisset billed the Tribe for 0.5 hours of service. Id. at 8.
April 7, 1994 - Morisset billed the Tribe for 0.8 hours of service. Id.
May 2, 1994 - the Tribe received billing statement for April. Id. at 8-9.
May 9, 1994 - the Tribe received letter from Morisset summarizing the status of the Val-USC § Construction case. Id. at 9.
June 1, 1994 - the Tribe received May 17, billing statement from Morisset. Id. at 10.
June 27, 1994 - letter sent to auditor in Sioux Falls from Morisset concerning Val-USC § Construction litigation. Id. at 10-11.
III. SUMMARY JUDGMENT STANDARD
[¶8] Under Rule 56(c) of the Federal Rules of Civil Procedure, a movant is entitled to summary judgment if the movant can "show that there is no genuine issue as to any material fact and that [the movant] is entitled to judgment as a matter of law." In determining whether summary judgment should issue, the facts and inferences from those facts are viewed in the light most favorable to the nonmoving party, and the burden is placed on the moving party to establish both the absence of a genuine issue of material fact and that such party is entitled to judgment as a matter of law. Fed. R. Civ. P. 56(c); Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 106 S. Ct. 1348, 1356-57, 89 L. Ed. 2d 538 (1986). Once the moving party has met this burden, the nonmoving party may not rest on the allegations in the pleadings, but by affidavit or other evidence must set forth specific facts showing that a genuine issue of material fact exists.
[¶9] In determining whether a genuine issue of material fact exists, the Court views the evidence presented based upon which party has the burden of proof under the underlying substantive law. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 106 S. Ct. 2505, 2513, 91 L. Ed. 2d 202 (1986). The Supreme Court has instructed that "[s]ummary judgment procedure is properly regarded not as a disfavored procedural shortcut, but rather as an integral part of the Federal Rules as a whole, which are designed 'to secure the just, speedy, and inexpensive determination of every action.'" Celotex Corp. v. Catrett, 477 U.S. 317, 327, 106 S. Ct. 2548, 2555, 91 L. Ed. 2d 265 (1986). The nonmoving party "must do more than simply show that there is some metaphysical doubt as to the material facts," and "[w]here the record taken as a whole could not lead a rational trier of fact to find for the non-moving party, there is no 'genuine issue for trial.'" Matsushita, 106 S. Ct. at 1356.
DISCUSSION
[¶10] The issue in this case is a narrow one: does the statute of limitations preclude plaintiffs' malpractice action? The Tribe claims that the statute of limitations is tolled by the doctrine of continuous representation. Response at 8. According to the Tribe, Morisset continued to represent it at least until April 7, 1994, which, given the three-year statute of limitations, would mean the commencement of this case on March 20, 1997, was within the statute of limitations. Plaintiffs' Facts at 11.
[¶11] Both sides concur that this question is governed by South Dakota law. SDCL 15-2-14.2 governs malpractice actions. It provides:
Time for bringing legal malpractice actions - Prospective application. An action against a licensed attorney, his agent or employee, for malpractice, error, mistake or omission, whether based upon contract or tort, can be commenced only within three years after the alleged malpractice, error, mistake or omission shall have occurred. This section shall be prospective in application.
SDCL 15-2-14.2. This is an occurrence law which means the statute begins to run from the date of the allegedly negligent act giving rise to the cause of action. Keegan v. First Bank of Sioux Falls, 519 NW2d 607, 612 (S.D. 1994). The parties agree that the negligent act giving rise to this action, Morisset's recommendation that the Tribe not attend an arbitration hearing, occurred in April 1991. Response at 2; Defendants' Reply (Reply) at 2. The suit commenced on March 20, 1997, and therefore the three year statute of limitation bars this action unless an exception applies which tolls the statute.
[¶12] The Tribe argues that the continuous representation doctrine tolls the statute of limitations until after the action was commenced on March 20, 1997. Response at 8-9. The continuous representation doctrine tolls the statute of limitations until the legal representation terminates. Schoenrock v. Tappe, 419 NW2d 197, 200 (8th Cir. 1988). In Schoenrock, the South Dakota Supreme Court outlined the requirements of applying the continuous representation doctrine:
We hold, however, that the continuous representation doctrine applies only to malpractice actions when there is a "clear indicia of an ongoing, continuous, developing, and dependent relationship between the client and the attorney . . . ." This relationship is one "which is not sporadic but developing and involves a continuity of the professional services from which the alleged malpractice stems. (citations omitted). (emphasis added).
Id. at 201. Therefore, the central issue in this dispute is the date representation terminated.
[¶13] Morisset argues that its representation ended in February 1994. Defendants' Motion at 10. Morisset asserts that one of three triggering events supports this argument: (1) Morisset's letter to the Tribe informing them that it would withdraw unless paid; (2) the Tribe's resolution removing Morisset from the litigation; or (3) the district court's oral granting of the motion to withdraw. Id. at 10-15. Any actions taken by Morisset after one of these three events was merely the "winding down" of the representation. Id. at 13. Such concluding activity, according to Morisset, does not demonstrate a "developing" representation as required by the continuing representation doctrine.
[¶14] The Tribe, on the other hand, emphasizes those activities which occurred after March 20, 1994, in concluding that the representation continued. First, the Tribe notes that Morisset continued to bill the Tribe for services performed as late as May 1994. Response at 14-15. Second, the Tribe offers the language used by Morisset in various communications which demonstrates an on-going, developing relationship. In a letter dated January 31, 1994, Morisset noted that "Ms. McGaw and I remain available to answer any questions that any Council member may have or any questions about the Val-USC § case that the Tribe's other attorneys may have." Plaintiffs' Facts at 2,3,4,5,6,7. The billing statements from Morisset, received by the Tribe as late as May 24, 1994, indicate that services billed were rendered pursuant to a contract "which was in effect at the time these services were rendered." Id. at 15. Third, the Tribe notes that the formal order granting Morisset's motion to withdraw was not issued until March 29, 1994.
[¶15] The burden of demonstrating continuous representation lies with the party depending on the doctrine, in this case the Tribe. Greene v. Morgan, Theeler, Cogley & Petersen, 575 NW2d 457, 459 (S.D. 1998); Bosse v. Quam, 537 NW2d 8, 11 (1995). While the Court is mindful of the Tribe's assertions concerning the actions taken by Morisset in March and April of 1994, the facts demonstrate that the representation had ended in February 1994.
[¶16] The attorney-client relationship is consensual and its termination can be effected by the actions of either party. Flynt v. Brownfield, Bowen & Bally, 882 F2d 1048, 1052 (6th Cir. 1989); Artromick Int'l, Inc. v. Drustar, Inc., 134 F.R.D. 226, 229 (S.D. Ohio 1991). In the instant case, both parties indicated their desire for the representation to end in February 1994. Morisset's letter of January 31, 1994, demonstrates that unless payment was forthcoming it no longer would represent the Tribe. This unilateral action was followed by Tribal resolution of February 16, 1994, revealing the Tribe's desire to end the representation - "the law firm of Pirtle, Morisset, Schlosser & Ayer is hereby directed to withdraw as counsel in Cause No. 91-3019, and any related cases." This alone has been found to be enough to end a relationship for purposes of the continuous representation doctrine. Dolce v. Gamberdino, 376 N.E.2d 273, 274 (Ill. App. 1978); Basic Food Indus., Inc. v. Travis, Warren, Nayer & Burgoyne, 231 NW2d 466, 468 (Mich. App. 1975). Finally, the district court's oral order, as reflected in the clerk's minutes, of February 25, 1994, completes the triangle. The clerk's minutes indicated that "the motion to withdraw of Mason Morisset and K. Allison McGaw is granted." Attachment 6 to Defendants' Requests for Admissions. Although not written, the oral decision by the court was enough to end the representation.
[¶17] There is no doubt that Morisset did undertake certain activities relating to its representation of the Tribe following the Tribal resolution and oral order of the district court. Critical to determining the weight to be accorded these contacts is their quality, as opposed to quantity, in context of the overall relationship. Flynt v. Brownfield, Bowen & Bally, 726 F. Supp. 1106, 1113 (S.D. Ohio 1989). The actions taken by Morisset after February were primarily administrative, and they clearly demonstrate a "winding down" of the relationship. For example, the Tribe makes note of various billing statements from Morisset during March, April, and May for services rendered in March and April. However, none of these billing statements reflect more than .8 of an hour spent on the file at any one time. Review of the status of the case was billed as was time for communicating the need for the Tribe to obtain other counsel. These actions do not denote a continuing, developing relationship between Morisset and the Tribe but rather a concerted effort to conclude their relationship. Simply because this wrapping up process took several weeks does not toll the statute of limitations under the continuing representation doctrine.
[¶18] In sum, the Court finds that Morisset's representation of the Tribe, for all intents and purposes, ceased on one of three dates: (1) the date the Tribe received Morisset's letter indicating its intention to withdraw unless further payment was made; (2) the date of Tribal resolution No. 94-40; or (3) the date the district court orally granted Morisset's motion to withdraw. Since all three dates occurred in February 1994, the statute of limitations expired three years later, sometime in February 1997, and commencement of this action on March 20, 1997, was time barred.
CONCLUSION
[¶19] The sole issue in this motion for summary judgment was whether the continuing representation doctrine tolled the statute of limitations long enough to render valid the Tribe's commencement of this malpractice action on March 20, 1997. Morisset conveyed to the Tribe in February 1994, that it would no longer represent the Tribe unless it received payment for past services. Also in February, the Tribe passed a resolution which removed Morisset from representation. The district court orally granted Morisset's motion to withdraw as counsel on February 25, 1994, although the formal order was not signed until March 29, 1994. While Morisset did do work on behalf of the Tribe following February 1994, these were tasks done to conclude the relationship and did not satisfy the developing relationship component of the continuous representation doctrine. Since the relationship concluded in February 1994, the three-year statute of limitations for malpractice actions as outlined in SDCL 15 -2-14.2 had expired before commencement of this action on March 20, 1997. Thus, the Tribe's action against Morisset is time barred and dismissal is appropriate.
[¶20] Accordingly, it is hereby
[¶21] ORDERED that Morisset's motion for summary judgment is granted. Judgment for defendants against plaintiffs is granted. Costs shall be assessed by the Clerk.