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You can search the entire site. or go to the recent opinions, or the chronological or subject indices. Kaiser v. Umialik Insurance (03/11/2005) sp-5877

Kaiser v. Umialik Insurance (03/11/2005) sp-5877

     Notice:   This opinion is subject to correction  before
     publication  in  the  Pacific  Reporter.   Readers  are
     requested to bring errors to the attention of the Clerk
     of  the  Appellate  Courts, 303  K  Street,  Anchorage,
     Alaska 99501, phone (907) 264-0608, fax (907) 264-0878,


WILLIAM KAISER,               )
                              )    Supreme Court No. S-11088
             Appellant,            )
                              )    Superior Court No.
     v.                       )    4FA-02-02158 CI
INSURANCE,                    )    [No. 5877 - March 11, 2005]
             Appellees.            )

          Appeal  from the Superior Court of the  State
          of    Alaska,   Fourth   Judicial   District,
          Fairbanks, Niesje J. Steinkruger, Judge.

          Appearances:   William   Kaiser,   pro    se,
          Sheridan,  Oregon, Appellant.   Gary  Foster,
          Fairbanks, for Appellees.

          Before:   Bryner,  Chief  Justice,  Matthews,
          Eastaugh, Fabe, and Carpeneti, Justices.

          FABE, Justice.


          In  this bad faith action against insurers, the pro  se

plaintiff  filed his complaint at least a year after the  statute

of  limitations had run.  He appeals the dismissal of his  claim,

arguing that his untimeliness should be excused.  He argues  both

that  the  defendants  should be estopped  from  relying  on  the

statute  of  limitations and that the statute should  be  tolled.

The estoppel argument is raised for the first time on appeal, and

the  plaintiff  does not meet the requirements for  tolling.   We

therefore affirm the superior courts order dismissing his claim.


     A.   Factual History

          This  case  arises from a fire at William and  Patricia

Kaisers  North Pole home in April 1998.  The home was insured  by

Umialik Insurance, through agent Rural Alaska Insurance.  William

Kaiser  filed  an  insurance  claim  and  began  receiving   some

payments.   At  the  time, the Kaisers were in  the  midst  of  a

divorce  and  Patricia was, according to William, suffering  from

severe psychological and emotional distress.1

          In  a  pair  of letters dated July 29 and September  2,

1998,  Gary  Foster, who apparently served as both  attorney  and

investigator  for Umialik, wrote to Kaiser to deny the  insurance

claim  and  explain  the reasons for the denial.   In  these  two

letters, the first one brief and the second more detailed, Foster

depicted  the  fire as suspicious and the Kaisers  as  homeowners

saddled  with  an  unsellable property and an expiring  insurance

policy.   Foster  noted  that  in  March  1997  the  Kaisers  had

attempted to sell the house, but the sale fell through  when  the

prospective  purchasers  engineer found  many,  many  structural,

systems,  and  code problems.  Foster further recounted  that  in

December 1997 Kaiser informed Rural Alaska, his insurance agency,

that his wife had threatened to burn the house down and asked the

agency  whether  his policy would cover the  house  if  she  did.

Fosters letter then detailed an attempted refinancing of the home

in  January  1998,  which he surmised was  intended  to  pay  for

repairs.   According  to Fosters reconstruction  of  events,  the

refinancing  was  approved but conditioned on an  appraisal.   An

appraiser visited the home and found that its condition  rendered

it not appraisable.   The refinancing never occurred.

          On  February  12,  1998, according to Fosters  letters,

Kaiser  informed Rural Alaska that he did not want to  renew  the

insurance policy because he and his soon-to-be ex-wife planned to

move  out  by  April.  On April 13, however, Kaiser requested  an

          extension on the insurance policy, explaining to the insurance

agent  that  he  and his wife were going to stay  in  the  house.

According  to  Fosters  account, a Rural  Alaska  agent  informed

Kaiser  on the afternoon of April 20 that Umialik had denied  the

extension  and  that  other insurance was not  forthcoming.   The

house  burned  the  next  morning.  In the  course  of  the  fire

investigation,  Foster wrote, kerosene, not fuel oil,  was  found

near  the homes furnace.  Based on these events, Foster concluded

that it is more likely than not[] that [Kaiser] intentionally set

this fire.  Kaisers insurance claim was therefore denied.

           Fosters first letter also noted that Kaiser might have

ongoing  liabilities: Umialik might be obliged  to  pay  off  the

mortgage,  in  which case Kaiser would be liable for  reimbursing

Umialik.   Umialik  later  obtained a  default  judgment  against

Kaiser for just over $88,000.

          Following  the fire, Kaiser was hospitalized twice,  in

1999 and 2000, for a serious illness that left him physically and

intellectually unable to function in a reasonably normal  manner.

He  was  also arrested in December 2000 on unrelated drug charges

and has been incarcerated since then.

     B.   Procedural History

          On  September  12,  2002, while  in  a  federal  prison

hospital in Minnesota, Kaiser, acting as his own lawyer, filed  a

complaint    against   Umialik,   Foster,   and   Rural    Alaska

(collectively,  Umialik)  in superior court  in  Fairbanks.   The

complaint alleges that Kaiser had no involvement of any  kind  in

the  fire,  and further alleges bad faith by Umialik and  Foster.

According  to  Kaiser,  this  bad  faith  was  manifested  in   a

systematic  method of intimidation to deny [Kaiser] his  rightful

claim.   This assertion seems to refer to Fosters conduct of  the

investigation.  Before answering Kaisers complaint, Foster  moved

for  dismissal  under  Alaska Rule of Civil  Procedure  12(b)(6),

arguing  that  Kaisers  claim  was  barred  by  the  statute   of

limitations.  Rural Alaska joined the motion and Umialik filed  a

statement of non-opposition.  Kaiser then filed a Motion To  Show

Good  Cause To Allow Petitioner To File Claim, which contained  a

series  of  factual  assertions  that  Kaiser  claimed  supported

grant[ing] equitable tolling of the statute of limitations.   The

superior  court  considered  the  motion  as  an  opposition   to

dismissal and dismissed the complaint.


     A.   Standard of Review

          The superior court dismissed Kaisers claim under Alaska

Rule  of  Civil Procedure 12(b)(6).  Kaisers Motion to Show  Good

Cause  asserted  facts  not  included  in  the  complaint.   When

materials  outside the pleadings are submitted with regard  to  a

motion  to  dismiss,  the superior court must  either  explicitly

exclude  the materials or convert the motion into one for summary

judgment  under  Alaska Rule of Civil Procedure  56.2   When  the

superior court does neither, but instead decides the motion under

Rule  12(b)(6)  without  stating whether it  is  considering  the

outside  materials or not, this court has three options:   [W]  e

may reverse and remand for proper consideration, or we may review

the  superior courts decision as if the motion for dismissal  had

been  granted  after  exclusion of outside materials,  or  as  if

summary judgment had been granted after conversion of the  motion

to dismiss into one for summary judgment.3

          It  is not clear which standard the superior court used

in  this  case, nor whether the court excluded outside materials.

On  March  3, 2003, the superior court entered an order by  which

Kaisers  complaint [was] dismissed with prejudice.  It  noted  on

that  order that it considered Kaisers Motion To Show Good  Cause

as  an  opposition to dismissal.  But the superior  courts  final

judgment,  entered  on  April 14, 2003,  announced  that  it  had

granted summary judgment for the defendants.

          Under  Rule  12(b)(6) a complaint may be dismissed  for

failure to state a

claim  upon  which relief can be granted.  We review a  dismissal

under  Rule  12(b)(6) de novo presum[ing] all factual allegations

of   the  complaint  to  be  true  and  [making]  all  reasonable

inferences  in  favor of the non-moving party.4  The  failure  to

file  a  complaint  within  the time set  out  by  a  statute  of

limitation  is  a  ground  for  Rule  12(b)(6)  dismissal.5   The

complaint  should survive as long as there is  a  set  of  facts,

provable  within the framework of the complaint, under which  the

complaint was timely filed.6

          Summary judgment may be entered for a party under  Rule

56 when there is no genuine issue as to any material fact and . .

.  [the] party is entitled to judgment as a matter of law.7   All

reasonable  inferences of fact are drawn in favor  of  the  party

opposing the motion [for summary judgment] and against the moving

party.8  We review grants of summary judgment de novo.9

          Under  either standard, if the facts presented  by  the

plaintiff,  whether offered as allegations in a complaint  or  as

evidence  in  the  record, do not excuse his  untimeliness  as  a

matter  of law, his claim fails.  That is the case here.  Kaisers

complaint  was untimely as a matter of law even if we  take  into

account all of the facts he has alleged and asserted before  this

court  and  the superior court.  Our choice of whether to  review

the superior courts decision as a dismissal or a summary judgment

therefore has no effect on the outcome of the case.10

     B.   Kaisers Claim Was Barred by the Statute of Limitations.

          The  statute of limitations began running on  September

2,  1998,  when  Foster  sent  his  letter  offering  a  detailed

explanation  for the denial of Kaisers claim.  Kaiser  filed  his

complaint  alleging  bad faith in that denial  on  September  12,

2002,  over  four years later.  The Alaska statute of limitations

for  tort  actions  is two years11 and the statute  for  contract

actions  is  three  years.12  Kaisers  complaint  was  thus  late

regardless of how the claim is characterized.  Kaiser argues that

his unquestioned untimeliness should be excused.

          He  makes  two distinct arguments, one related  to  the

          doctrine of equitable estoppel and one related to equitable

tolling.   Although  both doctrines serve to excuse  an  untimely

filing,   they  differ  in  that  equitable  estoppel  turns   on

wrongdoing  by  the  party invoking the statute  of  limitations,

while  our  equitable tolling rule looks only  to  the  claimants

circumstances  whether he has pursued an alternative remedy  that

proved  unavailing.13  Neither doctrine saves Kaisers claim,  nor

does Alaskas statutory tolling provision.

          1.   Kaiser waived his claim to equitable estoppel.

          When   a   defendants  wrongful  conduct   lull[s]   [a

plaintiff] into inaction or otherwise induces him to delay filing

a  claim  until the limitation period has run, the  defendant  is

equitably  estopped  from invoking the statute.14   To  establish

grounds for equitable estoppel, the plaintiff must plead that  he

or  she  relied  on  the defendants fraud by  either  consciously

relying  on  an  affirmative  misrepresentation,  or  failing  to

discover fraudulently concealed evidence.15

          Kaiser  argues on appeal that Umialik is estopped  from

invoking  the  statute of limitations because Gary Foster  lulled

him  into  not  filing suit or seeking independent  legal  advice

until the statute had run.  But in his Motion To Show Good Cause,

which  the  superior court treated as an opposition to dismissal,

Kaiser  only  argued that his divorce, illness, and incarceration

should  toll the statute of limitations.  Kaiser averred  in  the

superior  court that he had experienced a bitter and  emotionally

draining   divorce   and  that  he  had  been   sick,   requiring

hospitalization in 1999 and again in 2000.  He also relied on his

arrest and incarceration on an unrelated matter in 2000.  He told

the superior court that he had unsuccessfully attempted to retain

counsel to represent him in the matter and did not have access to

the   appropriate  legal  materials  and  state  statutes   while

incarcerated.   Kaiser concluded by alleging  that  [u]nder  what

have been extremely difficult circumstances, he had attempted  to

address  this  matter  in a timely manner  and  []  attempted  to

          preserve his right to pursue action on this claim.  Based on

these  circumstances,  he  asked  the  superior  court  to  grant

equitable  tolling for the mitigating circumstances.  Kaiser  did

not  argue  in the superior court, as he does here, that  he  was

unaware  of  his  claim  as  a result of  Gary  Fosters  conduct.

Indeed,  at  the  time he opposed the motion to  dismiss,  Kaiser

argued  that  he had attempted to pursue his claim  in  a  timely

fashion and was unable to proceed with his claim because  of  his

illness  and  incarceration.  Estoppel is thus a  new  theory  of

Kaisers case, not raised below.  This court will not consider  on

appeal  new  arguments which (1) depend on  new  or  controverted

facts,  (2)  are not closely related to the appellants  arguments

[in the superior court], and (3) could not have been gleaned from

the  pleadings,  unless  the new issue raised  establishes  plain


          Kaisers estoppel claim is based on new facts and cannot

be discerned from his pleadings.  He appears to base his claim of

equitable  estoppel on the allegation that [s]ubsequent  to  [the

letter  denying  Kaisers claim], Gary Foster  informed  appellant

that  he could not sue or pursue any claim against Umialik.  This

argument  is presented only in Kaisers appellate briefs.   Kaiser

alleges  in  his  complaint that Foster engaged in  a  systematic

method of intimidation to deny plaintiff his rightful claim,  but

this  allegation does not go to equitable estoppel.   It  appears

that   Kaiser  is  alleging  interference  with  his  claim   for

reimbursement from the insurance company, not with his ability to

file  a  lawsuit,  and there is no mention of   communication  by

Foster  concerning  Kaisers right to  sue.   The  complaint  also

alleges  bad  faith acts of the insurance company  through  their

attorney  Gary  Foster.  Similarly, the alleged  bad  faith  acts

appear to relate to the denial of the insurance claim, not to the

discouragement of a lawsuit.

          Finally,  Kaisers  estoppel  argument  is  not  closely

related  to  the  tolling argument he made  before  the  superior

          court.  While the two doctrines have the same general effect of

excusing untimeliness, they focus on entirely different realms of

facts   estoppel looks to the conduct of the party  invoking  the

limitation   period   while  tolling  is   concerned   with   the

circumstances of the untimely party.17  Kaisers opposition to the

motion   to   dismiss  was  based  on  the  extremely   difficult

circumstances of divorce, illness, and incarceration that he  had

experienced  and his tolling argument was based on his  inability

to retain counsel or address the known claims during this period.

Kaisers  appellate claim that defendants should be estopped  from

asserting the statute of limitations as a defense is thus  a  new

argument  and  is  waived because he did  not  raise  it  in  the

superior court; we will not consider it here.18

          2.   Kaiser is not entitled to equitable tolling.

          In  Alaska, the doctrine of equitable tolling has  been

applied  to  halt the running of the statute of limitations  when

multiple  legal remedies are available to the plaintiff and  time

runs  out  on one remedy while the plaintiff is pursuing  another

unavailing remedy.19  A claim for tolling has three elements:  (1)

pursuit  of the initial remedy [must] give[] defendant notice  of

plaintiffs  claim,  (2)  defendants ability  to  gather  evidence

[must] not [be] prejudiced by the delay, and (3) plaintiff [must]

act[] reasonably and in good faith.20  Kaiser has not pursued any

other  remedy  and  therefore cannot toll the  limitation  period

under this theory.

          Other  jurisdictions  apply equitable  tolling  in  two

additional  situations.   The statute may  be  tolled  where  the

plaintiff,  by  exercising reasonable diligence, could  not  have

discovered  essential information bearing on his or her  claim.21

Alaska   recognizes  this  principle  in  its   discovery   rule,

controlling  the starting date of the statute of limitations  for

certain claims.22  In many jurisdictions, equitable tolling  also

applies  where extraordinary circumstances outside the plaintiffs

control make it impossible for the plaintiff to timely assert his

          or her claim.23  We have neither accepted nor rejected this theory

of tolling.

          But this case does not require us to decide whether the

statute of limitations should be tolled when the plaintiff  faces

extraordinary  circumstances beyond his control,  because  Kaiser

faced no such circumstances.  He claims the events following  the

denial  of  his insurance claim  his divorce, incarceration,  and

illness   add up to extraordinary circumstances.  But  these  are

not  the  kind of extraordinary circumstances that would  justify

tolling.   Courts have allowed equitable tolling when  plaintiffs

have  been kept from the courts by legal barriers24 or  by  truly

extraordinary events, like wars.25  Even if we were to  recognize

equitable   tolling  for  extraordinary  circumstances,   Kaisers

circumstances, as a matter of law, would not earn it.26

          3.    Tolling under AS 09.10.140 does not save  Kaisers


          Alaska Statute 09.10.140 provides that when a person is

incompetent  by  reason of mental illness  or  mental  disability

during  the limitation period, the period is tolled for the  time

of  the  disability.  We interpret[] liberally the type of mental

condition  that will toll a statute of limitations.  The  general

test  is  whether  a  person could know or understand  his  legal

rights sufficiently well to manage his personal affairs.27  Kaiser

does  not raise this tolling statute, but he does assert that  he

was  totally incapacitated . . . for approximately six []  months

in  1999 and that he was physically and intellectually unable  to

function  in  a  reasonably  normal  manner  during  his   second

hospitalization,  in May of 2000.  Even accepting  the  inference

that  the  2000  hospitalization left him incapacitated  for  the

entire  month of May, that adds up to seven months of incapacity.

Under  the  most  generous statute of limitation  that  might  be

available to him, Kaiser had three years to file his claim.28  He

filed  four  years  after the statute began running.   Even  with

seven months tolling, he was untimely as a matter of law, and his

          claim is barred by the statute of limitations.


          For the foregoing reasons, the judgment of the superior

court is AFFIRMED.

     1     This factual account is drawn from the allegations  of
Kaisers  complaint, the attachments thereto,  and  assertions  he
made  in  subsequent  briefing.   The  attachments  are  properly
considered as part of the complaint.  See Hal Roach Studios, Inc.
v.  Richard  Feiner & Co., Inc., 896 F.2d 1542,  1555  (9th  Cir.
1990);  Ahwinona  v.  State, 922 P.2d  884,  886  (Alaska  1996).
Although  the subsequent assertions are unsworn and not  part  of
the  record, they are not contested and we include them  here  in
order  to  provide  the  pro se appellant  the  fullest  possible
opportunity to make his case.

     2    Alaska R. Civ. P. 12(b); Martin v. Mears, 602 P.2d 421,
425-26 (Alaska 1979).

     3     Reed v. Municipality of Anchorage, 741 P.2d 1181, 1184
(Alaska 1987).

     4     Kollodge  v. State, 757 P.2d 1024, 1026 & n.4  (Alaska
1988) (quotation marks and ellipsis omitted).

     5     Hutton  v. Realty Executives, Inc., 14 P.3d  977,  979
(Alaska 2000).

     6     Toney v. City of Anchorage Police Dept, 950 P.2d  123,
124 (Alaska 1997).

     7    Alaska R. Civ. P. 56(c).

     8     Yurioff v. American Honda Motor Co., 803 P.2d 386, 388
(Alaska 1990).

     9     Power Constructors, Inc. v. Taylor & Hintze, 960  P.2d
20, 28 (Alaska 1998).

     10    The resolution of this particular case does not relieve
the  superior court of its duty to clarify the standard  it  uses
and to announce whether it is excluding outside material.

     11    AS 09.10.070.

     12    AS 09.10.053.

     13     See  Abbott  v. State, 979 P.2d 994,  997-98  (Alaska
1999);  see  also Fred Meyer, Inc. v. Bailey, 100 P.3d  881,  886
(Alaska 2004).

     14     Gudenau & Co., Inc. v. Sweeney Ins., Inc.,  736  P.2d
763,  769 (Alaska 1987); see also Groseth v. Ness, 421 P.2d  624,
630 (Alaska 1966).

     15     Law  Offices of Steven D. Smith, P.C. v.  Borg-Warner
Security Corp., 993 P.2d 436, 446 (Alaska 1999).

     16    Krossa v. All-Alaskan Seafoods, Inc., 37 P.3d 411, 418-
19 (Alaska 2001) (quotation marks and citation omitted).

     17    See Abbott, 979 P.2d at 997-98.

     18    Although the superior court apparently relied on facts
outside  the  pleadings without prior notice of conversion  to  a
Civil  Rule 56 motion for summary judgment, the party potentially
prejudiced  by  the  superior courts failure  to  rely  on  these
matters  was  Umialik.  Had the superior court  decided  to  deny
Umialiks  motion  to dismiss based on Kaisers factual  assertions
without giving Umialik a chance to file further materials outside
the  pleadings, Umialik could have complained about the  lack  of
notice.   But because Kaiser was permitted by the superior  court
to  make  factual  claims that fell outside of the  pleadings  in
response to the motion to dismiss, he was not prejudiced  by  the
courts  failure to formally convert the motion.  And  whether  we
review the superior courts order as a ruling on the Rule 12(b)(6)
motion  or as a decision granting summary judgment, Kaiser  never
mentioned  his  equitable estoppel theory in  opposition  to  the
motion in the superior court.

     19     See  Fred  Meyer, Inc. v. Bailey, 100  P.3d  at  886;
Dayhoff  v. Temsco Helicopters, Inc., 772 P.2d 1085, 1087 (Alaska

     20    Id.

     21    Abbott, 979 P.2d at 998 (applying federal law).

     22    See, e.g., Sopko v. Dowell Schlumberger, Inc., 21 P.3d
1265,  1270-72 (Alaska 2001); Bauman v. Day, 892 P.2d 817, 827-28
(Alaska 1995); Greater Area, Inc. v. Bookman, 657 P.2d 828,  829-
30 (Alaska 1982).

     23     Abbott,  979  P.2d  at 998; see also,  e.g.,  Seattle
Audubon  Socy  v.  Robertson, 931 F.2d 590, 596 (9th  Cir.  1991)
([W]hen   external  forces,  rather  than  plaintiffs   lack   of
diligence,  account  for  the failure to  file  a  timely  claim,
equitable  tolling  is proper.); Dean Witter  Reynolds,  Inc.  v.
Hartman,  911  P.2d  1094, 1099 (Colo. 1996) (allowing  equitable
tolling  when  truly  extraordinary circumstances  prevented  the
plaintiff from filing his or her claim despite diligent efforts);
Machules  v.  Dept of Admin., 523 So. 2d 1132, 1134  (Fla.  1988)
(allowing  tolling  when plaintiff has in some extraordinary  way
been prevented from asserting his rights).

     24     Cf.  Seattle  Audubon, 931 F.2d at 595-96  (equitably
tolling  limitations   period  because  unconstitutional  statute
barred plaintiffs from filing claims).

     25     E.g.,  Hanger  v.  Abbott, 73 U.S.  532,  542  (1867)
(tolling  statute of limitations because Civil  War  made  filing
suit impossible); Osbourne v. United States, 164 F.2d 767, 768-69
(2d  Cir. 1947) (tolling statute of limitations because plaintiff
held in Japan during Second World War was unable to file claim).

     26    Cf. Yurioff v. American Honda Motor Co., 803 P.2d 386,
389-90  (Alaska 1990) (holding that discovery rule did  not  save
plaintiffs untimely claim merely because he was bedridden).

     27    Adkins v. Nabors Alaska Drilling, Inc., 609 P.2d 15, 23
(Alaska 1980).

     28    See AS 09.10.053 (three-year statute of limitations for
contract actions).