Manuel Delos Santos, D/B/A M.S. Quisqueya Meat Market v. State Farm Fire and Casualty Company

902 F.2d 1092, 16 Fed. R. Serv. 3d 512, 1990 U.S. App. LEXIS 7701
CourtCourt of Appeals for the Second Circuit
DecidedMay 7, 1990
Docket537, Docket 89-7838
StatusPublished
Cited by109 cases

This text of 902 F.2d 1092 (Manuel Delos Santos, D/B/A M.S. Quisqueya Meat Market v. State Farm Fire and Casualty Company) is published on Counsel Stack Legal Research, covering Court of Appeals for the Second Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Manuel Delos Santos, D/B/A M.S. Quisqueya Meat Market v. State Farm Fire and Casualty Company, 902 F.2d 1092, 16 Fed. R. Serv. 3d 512, 1990 U.S. App. LEXIS 7701 (2d Cir. 1990).

Opinions

KEARSE, Circuit Judge:

Plaintiff Manuel Delos Santos, d/b/a M.S. Quisqueya Meat Market (“Santos”) appeals from a final judgment of the United States District Court for the Southern District of New York, John M. Walker, Jr., then-Distriet Judge, dismissing his complaint against defendant State Farm Fire and Casualty Company (“State Farm”) for breach of an insurance contract. The district court granted State Farm’s motion for [1093]*1093summary judgment dismissing the complaint on the ground that Santos had failed to serve the summons and complaint on State Farm within 120 days after the filing of the complaint as required by Fed.R. Civ.P. 4(j). On appeal, Santos contends principally that the summons and complaint were properly served within the 120-day period, and that even if they were not, Rule 4(j) did not permit dismissal of the complaint because the pertinent statute of limitations had run. Though we reject these arguments, we conclude that State Farm had waived its right to challenge the sufficiency of service, and we therefore vacate the judgment dismissing the complaint.

I. BACKGROUND

The meat market operated by Santos was insured against risk of loss, up to $120,000, under an insurance policy issued by State Farm. On November 5, 1984, the meat market was damaged by fire. Santos filed a claim with State Farm for $97,554.

The insurance policy provided, inter alia, that “[n]o action shall be brought unless ... the action is started within two years after the occurrence causing loss or damage.” It also required the insured, after assertion of a claim under the policy, to submit to examinations under oath at the request of State Farm. Santos underwent several such examinations, until he refused to continue with his deposition on June 26, 1985. State Farm did not pay Santos’s claim.

On August 2, 1985, Santos filed his present complaint against State Farm in Bankruptcy Court for the Southern District of New York, where Santos had previously filed a voluntary petition. The complaint alleged, inter alia, that State Farm’s failure to pay Santos’s claim breached the insurance contract. Santos sought to serve State Farm on August 2 by delivering copies of the summons and complaint to the office of the attorneys who had represented State Farm at the depositions.

It apparently is undisputed that the attorneys were not authorized by State Farm to receive service of process. However, neither State Farm nor the attorneys so advised Santos. Instead, on August 30, 1985, State Farm served an answer to the complaint; an amended answer was served on September 19,1985. In both the answer and the amended answer, State Farm’s first affirmative defense asserted “[tjhat this Court lacks personal jurisdiction over the defendant.” Though 15 affirmative defenses were asserted, insufficient service of process was not mentioned.

On April 8, 1986, Santos’s Bankruptcy petition was dismissed. On November 12, 1986, Santos served a copy of the August 2, 1985 summons and complaint on the State of New York Insurance Department (“State Insurance Department”). Thereafter, State Farm served another answer; the first affirmative defense pleaded in this new answer was that “suit was not commenced within two years after inception of the loss as mandated by the policy sued upon.” The new answer omitted the allegation that the court lacked personal jurisdiction over State Farm.

On May 11, 1987, State Farm moved for summary judgment dismissing Santos’s contract claim, based, in part, on its statute-of-limitations defense. Affidavits submitted in support of the motion stated that the attorneys to whom the summons and complaint were delivered were not authorized to accept service on behalf of State Farm. State Farm stated that after Santos’s delivery of the summons and complaint to State Farm’s attorneys on August 2, 1985,

[a]n answer was interposed on behalf of the defendant which, in addition to general denials, to the extent here pertinent, alleged that the Court lacked personal jurisdiction over the defendant since the defendant had not been served with the summons and complaint.

State Farm contended that the only proper service was the November 12, 1986 service on the State Insurance Department and that Santos’s suit was thus barred by the contractual statute of limitations “because [State Farm] was not properly served with the summons and complaint within two years of the [November 5, 1984] loss.”

[1094]*1094State Farm’s summary judgment motion was made returnable before the Bankruptcy Court. On August 17, 1987, that court, noting that the underlying bankruptcy proceeding had been terminated, declined to decide the motion; it retained jurisdiction for the sole purpose of allowing Santos to seek to have the matter decided in the district court. Eventually, the case was placed on the calendar of the district court, but the May 1987 motion was not ruled on.

In the district court, State Farm renewed its motion to dismiss on January 17, 1989. Relying largely on the same arguments advanced in its May 1987 motion, it also argued that Santos’s November 12, 1986 service on the State Insurance Department was ineffective because “it was not made ... within one hundred twenty days (120) after the filing of the complaint as required by Rule 4(j) of the Federal Rules of Civil Procedure.” State Farm argued that Santos therefore had “never properly served [State Farm].” It concluded that Santos “cannot now cure the delay in properly commencing suit since any service of process at this time will be in excess of two years after the loss and thus untimely.”

In a Memorandum and Order dated August 7, 1989, the district court granted the motion to dismiss. The court found that the August 2, 1985 service of the summons and complaint was ineffective because the State Farm attorneys to whom they were delivered “were not authorized to accept process. Significantly, no one disputes that defendant’s counsel were not authorized to accept process.” Id. at 2. The court concluded that since the next attempt at service did not occur until November 1986, the summons and complaint were not served within 120 days of filing as required by Fed.R.Civ.P. 4(j). It found that Santos had failed to show good cause, or indeed any cause, for failing to serve properly within the required period.

Accordingly, the complaint was dismissed, and this appeal followed.

II. DISCUSSION

On appeal, Santos argues principally (1) that the August 2 delivery to State Farm’s attorneys was proper service on State Farm, and hence he complied with Rule 4(j); and (2) that in any event, Rule 4(j) was “unavailable” as a basis for dismissing his complaint because the Rule provides for a dismissal without prejudice and the dismissal was necessarily prejudicial to him because the statute of limitations had run. Though Santos’s contentions have no merit, we vacate the judgment because we conclude that State Farm had waived its defense of insufficient service of process.

First, we reject Santos’s argument that service on State Farm’s attorneys was proper.

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Bluebook (online)
902 F.2d 1092, 16 Fed. R. Serv. 3d 512, 1990 U.S. App. LEXIS 7701, Counsel Stack Legal Research, https://law.counselstack.com/opinion/manuel-delos-santos-dba-ms-quisqueya-meat-market-v-state-farm-fire-ca2-1990.