Rice v. Granite School District

QALLISTER, Justice:

Plaintiff initiated this action to recover for the injuries she sustained while attending a high school football game.. She alleged that she fell from a bleacher, which was negligently maintained by defendant in a dangerous, unsafe, and neglected condition. Defendant filed a motion to dismiss on the ground that plaintiff’s claim was barred by the one-year limitation period provided in Section 63-30-15, U.C.A.1953, Repl. Vol. Plaintiff filed an affidavit in opposition to defendant’s motion; the trial court treated the matter as a motion for summary judgment and dismissed her complaint with prejudice. On appeal, plaintiff contends that her affidavit contained sufficient facts to create an estoppel, which she was entitled to present to a jury.

For the purpose of this appeal defendant will concede the truth of the facts as set forth in plaintiff’s affidavit. Plaintiff has claimed to have suffered severe injuries to her neck and back, and as an incident thereto, she was required to have a surgical procedure performed to effect a fusion of her back in two places. Immediately following her accident, which occurred on the 30th of September, 1966, she notified in writing the authorities of Cyprus High School. Subsequently, plaintiff was contacted by an insurance adjuster of the Scott Wetzel Adjusting Company, who informed her that he represented the Great American Insurance Company, the insurance carrier for the Granite School District. The adjuster advised her that she would be compensated for her damages as soon as the costs thereof were ascertained.

During January of 1967, plaintiff was hospitalized for back surgery. Thereafter she was again contacted by an adjuster who reiterated that she would be indemnified for her medical expenses. She was reassured that the insurance company would accept responsibility and that she was not to worry. The adjuster showed her pictures of the bleachers and commented that they were old and obsolete and that there would be no problem whatsoever in taking care of her expenses.

During the month of November, 1967, plaintiff contacted the adjuster’s office and inquired as to the settlement. She was advised that everything was in proper order, but the company was unable to do anything until she was released by her doctor. In September, 1968, although plaintiff had rstill not been released by her doctor, she again contacted the company; she was notified for the first time that her claim was ■denied. She immediately contacted an attorney, who filed the instant action. Based ■on the aforementioned conduct of the adjuster, plaintiff contends that defendant is ■estopped to assert the statute of limitations.

As a preliminary matter it is important to notice the status of an insurance carrier under the Governmental Immunity Act. Section 63-30-14, U.C.A.1953, Repl. Vol., provides:

Within ninety days of the filing of a claim the governmental entity or its insurance carrier shall act thereon and notify the claimant in writing of its approval or denial. A claim shall be deemed to have been denied if at the end of the ninety-day period the governmental entity or its insurance carrier has failed to approve or deny the claim. (Emphasis added.)

Implicit within this statutory designation of the insurance carrier to deal directly with the claimant is the acknowledgment that the insurance carrier’s conduct may be such as to support an estoppel. The insurance carrier is specifically authorized to approve or deny a claim; therefore, we are not confronted by a fact situation wherein the agent’s actions were not authorized by statute, and the governmental entity could not be estopped to assert the statute of limitations.

Similarly, the concept that a governmental entity is generally not subj ect to an estoppel cannot be sustained under the mandate of Section 63-30-4, which provides :

* * * Wherein immunity from suit is waived by this act, consent to be sued is granted and liability of the entity shall be determined as if the entity were a private person.

The Supreme Court of the State of Washington has observed:¹

Governmental immunity from estoppel is a derivative of the doctrine conferring the sovereign entity with immunity from suit without its consent. [Citations omitted.] The legislature of this state has indicated that sovereign immunity in tort actions is no longer desirable or acceptable. R.C.W. 4.92.090. The modern trend in both legislative and judicial thinking is toward the concept that the citizen has a right to expect the same standard of honesty, justice and fair dealing in his contact with the state or other political entity, which he is legally accorded in his' dealings with other individuals. * * *

The foregoing concept has been embodied in the Utah Governmental Immunity Act. It would appear to be an anomalous situation if we were to hold that although sovereign immunity has been waived, a derivative- of that doctrine, governmental immunity from estoppel, is a viable principle which may be asserted to avert liability by an entity denominated by the act as a private person.

■ Even if the one-year limitation of Section 63-30-15 be deemed mandatory, this court has previously held:

* * * Waiver or estoppel may be found in the face of a mandatory statute. For instance, statutes of limitation ordinarily are mandatory both in form and effect. Nevertheless, they may be waived or the party may be estopped from relying upon them. [Citation omitted.]²

A case which reviews the relevant principles to be applied in the instant action is Dettamanti v. Lompoc Union School District, ³ wherein the court stated:

* * * Although it has been repeatedly held that compliance with the appropriate claim statute is mandatory and an essential requisite to plaintiff’s cause of action, nevertheless, the time demerit? with respect to the filing of the claim-is essentially procedural in nature and': is analogous to a statute of limitation. It has been intimated by some authorities, that the claim statute is the measure of-the power of the governmental agency in paying the tort claims involved, andi hence any deviation from that procedure-cannot be dispensed with by waiver,, estoppel, or otherwise. That conclusion,, at least with respect to the time of filing - the claim, is not supported .by the statute or reason. The various reasons advanced for the adoption of the claim statute,, that is, to afford the agency an opportunity to investigate the merits of the-claim, and to arrive at a settlement, thus - avoiding litigation, are not inconsistent with the view that the statute is not the measure of the power. From the standpoint of the agency it has general power ■ to pay claims arising from the liability imposed by the public liability act. Hence-the filing of the claim within ninety days, while mandatory upon the claimant and' a condition precedent to his cause of action, is nothing more than a procedural requirement as to the agency, which,., as to the claimant, may be excused by-estoppel. * * *

In Benner v. Industrial Acc. Comm., supra, 26 Cal.2d 346, 349, 159 P.2d 24, 26, the court said: “Where, as here, the delay in commencing action was induced by the conduct of the party sought to he charged the latter may not invoke such conduct to defeat recovery. An estoppel may arise although there was no designed fraud on the part of the person sought to be estopped. To create an equitable estoppel, ‘it is enough if the party has been induced to refrain from using such means or taking such action as lay in his power, by which he might have retrieved his position and saved himself from loss.’ * * * ‘It is well settled that a person by his conduct may be estopped to rely upon these defenses. Where the delay in commencing action is induced by the conduct of the defendant it cannot be availed of by him as a defense.’ ”⁴

Furthermore, we do not find applicable in the instant case the principle that an •estoppel in pais may not be invoked in respect to cases arising under statutes •creating a new cause of action and limiting the time for commencing suit thereunder.

The Utah Governmental Immunity Act does not create a new cause of action; this act merely waives a defense, sovereign immunity in certain specified actions; see Section 63-30-5 through 63-30-10,⁵ and provides that the liability of the governmental entity shall be determined as if the entity were a private person.

Defendant asserts that the judgment of the trial court should be affirmed because settlement negotiations do not estop a party from interposing the statute of limitations as a defense.

The question of whether negotiations for the compromise of a claim or debt will give rise to an estoppel against pleading the statute of limitations depends upon the character of the negotiations and the circumstances surrounding the parties.⁶ In the instant action, the facts, as asserted in plaintiff’s affidavit, indicate that the adjuster for the insurance carrier admitted liability and promised compensation upon several occasions. Plaintiff was led to believe that the only unresolved issue was the ascertainment of her damages, which she was informed was contingent solely on her discharge by her doctor. If the facts be substantiated in plaintiff’s affidavit, the trier of fact could reasonably conclude that the conduct of the adjuster was such as to induce plaintiff to delay filing her action.

Where the delay in commencing an action is induced by the conduct of the defendant, or his privies, or an insurance adjuster acting in his behalf, it cannot be availed of by any of them as a defense.

One cannot justly or equitably lull an adversary into a false sense of security thereby subjecting his claim to the bar of limitations, and then be heard to plead that very delay as a defense to the action when brought. Acts or conduct which wrongfully induce a party to believe an amicable adjustment of his claim will be made may create an estoppel against pleading the Statute of Limitations. [Citations omitted.] ⁷

The record that was before the trial court upon the motion for summary judgment discloses the existence of a genuine issue of a material fact, namely, whether defendant is estopped to assert Section 63-30-15, U.C.A.1953, Repl. Vol. as a bar to recovery in this action. The trial court erred by its entry of summary judgment in behalf of defendant. This case is reversed and remanded for further proceedings in accordance with this opinion.

TUCKETT, J., concurs.

1 . Finch v. Matthews, Wash., 443 P.2d 833, 842 (1968).

2 . Hurley v. Town of Bingham, 63 Utah 589, 592, 228 P. 213, 214 (1924) ; also see McKee v. Industrial Comm., 115 Utah 550, 206 P.2d 715 (1949), wherein this court stated that if the plaintiff could establish the facts to support an estop-pel, the defendant could he estopped to assert the statute of limitations under the Workmen’s Compensation Act as a bar to plaintiff’s right to compensation-

3 . 143 Cal.App.2d 715, 300 P.2d 78, 81 (1956).

4 . Also see Rand v. Andreatta, 60 Cal.2d 846, 36 Cal.Rptr. 846, 389 P.2d 382 (1964) ; Bruce v. Jefferson Union High School District, 210 Cal.App.2d 632, 26 Cal.Rptr. 762 (1962) ; Driscoll v. City of Los Angeles, 67 Cal.2d 297, 61 Cal.Rptr. 661, 431 P.2d 245 (1967); and Lerner v. Los Angeles City Bd. of Education, 59 Cal.2d 382, 29 Cal.Rptr. 657, 380 P.2d 97 (1963).

5 . As an example of tlie construction of the act, Section 63-30-9 provides: “[i]m-munity from suit of all governmental entities is waived for any injury caused from a dangerous or defective condition of any public building, structure, dam, reservoir or other public improvement. Immunity is not waived for latent defective conditions.”

6 . 24 A.L.R.2d Statute of Limitations — Estoppel, Sec. 13, pp. 1430-1431.

7 . North v. Culmer, Fla.App., 1967, 193 So.2d 701, 705; also see Knight v. Lawrence, 331 Mass. 293, 118 N.E.2d 747 (1954); MacKeen v. Kasinskas, 333 Mass. 695, 132 N.E.2d 732 (1956), wherein the court held that the evidence warranted a finding that the defendant was estopped from asserting the statute of limitations by reason of the conduct of an adjuster for an insurance company. The court found that the representations of the adjuster were such as to lead plaintiffs reasonably to believe that when they were fully recovered from their injuries and their damages could be definitely determined, the insurer would pay them for all sucli damages.