Ponce v. Parker Fire District (CA1 3/27/14)

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Yet another notice-of-claim case, this one involving waiver-by-litigation.

Ponce’s house burned down a few days after the house next door did. He blamed un-extinguished embers that escaped through openings made by the firefighters. He filed a notice of claim but did so 16 days late – 196 days rather than 180. Then he filed suit. The fire district litigated it for a year before moving for summary judgment on the notice issue. The trial court granted it.

The Court of Appeals reverses. Although the District had not initiated any discovery it had participated in a lot of it, much of it having nothing to do with the notice issue. It also did such things as to move for change of venue. And although it claimed that it needed Ponce’s deposition to support its notice defense, it argued the motion in such a way that what he said didn’t matter. It also contended that it needed the deposition of Ponce’s expert in aid of another argument it made in its motion for summary judgment. But the notice issue didn’t have to wait for that; there was no reason that it could not have been resolved promptly.

So the District said that summary judgment was proper on that other argument, a fact-dependent claim that Ponce’s expert wasn’t qualified. The Court of Appeals disagrees. Judgment reversed.

(link to opinion)

Newman v. Cornerstone National Insurance (CA1 3/27/14)

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                                             THIS OPINION HAS BEEN VACATED

This presents the issue raised in Melendez but this panel comes to the opposite conclusion.

Newman had refused an offer of UIM coverage but argued that the offer was invalid because it didn’t quote a premium. The trial court disagreed and gave Cornerstone summary judgment. Then, in Melendez, this court agreed with the argument. Newman got a different panel, though. Apparently it took a hint from the fact that the Supreme Court had later re-designated Melendez a memorandum (or took some other hint; how information works its way along the judicial grapevine is not for outsiders to know – in fact, you’re not even supposed to know that there is one).  The court concludes that the statute doesn’t require a premium quote with the offer.

Except to say that Newman relied on it the court does not mention Melendez. Whether that is intended as a comment is an exercise for the reader. Melendez is a memo now, so there’s an excuse.

(link to opinion)

In Re Estate of Snure (CA2 2/28/14)

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Whether this case is right or wrong, it’s a good little practice pointer/reminder.

A creditor contacted an estate to make a claim. She gave it her address, phone number, and email address. It replied to her by email.  Later, the estate denied the claim. It notified her only by certified mail, return receipt requested. The letter was returned unclaimed. (If you don’t see where this is going then you do need to read the rest of it.)

When she learned of the disallowance she filed a petition. She argued that because she wasn’t given notice of disallowance, her claim – per the normal statutory procedure – was allowed. The estate pointed out that the statute (14-3806) says to give notice of disallowance by “mail.” The trial court dismissed the petition.

Of course the Court of Appeals was going to find a reason to reverse. Whenever courts have to wonder whether you were really trying to give notice, or not really trying to give notice, or really trying not to give notice, you’re likely to lose. The court finds a U.S. Supreme Court case (Jones 2006) to the effect that notice by certified mail isn’t due process if its returned unclaimed. Since the estate had reason to know that the creditor hadn’t received notice, it should have done something else.

The estate did not contend that the creditor deliberately did not pick up the certified letter, perhaps because it couldn’t prove it. That’s the problem with certified/return-receipt mail: you never can. The letter is a two-edged sword; its purpose is to prove that a letter was received but it can also prove that it wasn’t. We all know that some people never pick up certified mail, so as to avoid the bad news it often brings; but the same people who boast of that when it makes them seem clever will deny it when it doesn’t.

The court rules, however, that the failure to give actual notice does not result in allowance of the claim. It holds instead that the time for responding to the disallowance runs from the date the creditor had actual knowledge of it. Dismissal of the petition is therefore reversed and the parties will litigate whether the claim should be allowed.

(link to opinion)