Higgins v. Superior Court
D071353M
Cal. Ct. App.Sep 28, 2017Background
- Cabandong filed a state court action in May 2012 against Powell, PFS, and Doe defendants seeking recovery of $155,000; Powell later appeared.
- Powell filed chapter 7 bankruptcy on March 13, 2014; Cabandong then filed an adversary proceeding in bankruptcy court alleging nondischargeability.
- Powell received a bankruptcy discharge on August 5, 2014; the bankruptcy case trustee was discharged and the case closed shortly thereafter.
- Cabandong amended in August 2016, naming Higgins (formerly Doe 2) and served him with the summons and third amended complaint on August 16, 2016 — more than three years after the May 2012 filing.
- Higgins moved to dismiss under Cal. Civ. Proc. Code § 583.210(a) for failure to serve within three years; the superior court denied the motion, reasoning Powell’s bankruptcy stay tolled the three-year period.
- The Court of Appeal granted mandamus, holding the automatic bankruptcy stay applied only to debtor Powell (not to nondebtor Higgins), so the three-year service period was not tolled and dismissal was required.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the automatic bankruptcy stay on Powell tolled the § 583.210 three-year service period as to nondebtor Higgins | The stay prevented prosecution of the entire state action from March 2014 until the bankruptcy court lifted the stay in July 2016, so service was timely | The automatic stay applies only to the debtor Powell and did not prevent serving or prosecuting claims against Higgins | Court: Stay applies only to debtor; it did not toll time to serve Higgins; superior court erred in denying dismissal |
| Whether service of the third amended complaint relates back to the original complaint for purposes of the three-year rule | Relation-back for Doe pleading means service relates to original filing, curing delay | Relation-back doctrine is distinct from the mandatory service requirement; relation-back does not eliminate the duty to serve within three years | Court: Relation-back does not excuse failure to serve within three years; separate requirement must be satisfied |
| Whether plaintiff’s post-petition discovery of Higgins’s identity excuses delayed service under § 583.240(d) | Discovery in the adversary proceeding showed Higgins’s role, making service earlier impossible or impracticable | Failure to discover identity is not a cause beyond plaintiff’s control and does not satisfy § 583.240(d) | Court: Failure to discover identity is not an excusing cause; tolling not established |
| Effect of Powell’s discharge on the duration of the automatic stay | The stay remained until the bankruptcy court’s July 2016 order lifting the stay in the adversary proceeding | Discharge terminated the automatic stay on August 5, 2014; any continuing injunction is limited to the debtor | Court: Discharge ended the automatic stay as a matter of law on Aug 5, 2014; even assuming tolling, plaintiff still served Higgins well after any excluded period |
Key Cases Cited
- Sanchez v. Superior Court, 203 Cal.App.3d 1391 (1988) (dismissal for failure to serve within three years is mandatory)
- Shaoxing County Huayue Import & Export v. Bhaumik, 191 Cal.App.4th 1189 (2011) (automatic stay is effective upon filing the bankruptcy petition)
- Valencia v. Rodriguez, 87 Cal.App.4th 1222 (2001) (same regarding automatic stay effectiveness)
- Cross v. Cooper, 197 Cal.App.4th 357 (2011) (automatic stay does not apply to nondebtor codefendants)
- Danko v. O'Reilly, 232 Cal.App.4th 732 (2014) (automatic stay does not extend to nondebtor entities)
- International Engine Parts, Inc. v. Feddersen & Co., 9 Cal.4th 606 (1995) (reviewing statutory application to undisputed facts is a question of law)
- Lopa v. Superior Court, 46 Cal.App.3d 382 (1975) (relation-back for fictitious Doe defendants does not satisfy service-timing rules)
- Republic Corp. v. Superior Court, 160 Cal.App.3d 1253 (1984) (failure to discover true identity is not an excuse under predecessor tolling rule)
- Weakly-Hoyt v. Foster, 230 Cal.App.4th 928 (2014) (discharge replaces automatic stay with an injunction that protects only the debtor)
- Cahill v. San Diego Gas & Electric Co., 194 Cal.App.4th 939 (2011) (issues not properly raised or supported are forfeited)