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You can search the entire site. or go to the recent opinions, or the chronological or subject indices. American Marine Corporation v. Sholin (3/8/2013) sp-6755

American Marine Corporation v. Sholin (3/8/2013) sp-6755, 295 P3d 924

       Notice:  This opinion is subject to correction before publication in the PACIFIC  REPORTER . 

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d/b/a AMERICAN HYPERBARIC                        ) 

CENTER,                                          ) 

                                                 )   Supreme Court No. S-14299 

                       Appellant,                ) 

                                                 )   Superior Court No. 3AN-09-12353 CI 

        v.                                       ) 

                                                 )   O P I N I O N 

CRYSTAL SHOLIN, Individually; and                ) 

PUBLIC EMPLOYEES LOCAL 71                        ) 

TRUST FUND,                                      ) 

                                                 )   No. 6755 - March 8, 2013 

                       Appellees.                ) 


               Appeal from the Superior Court of the State of Alaska, Third 

               Judicial District, Anchorage, Andrew Guidi, Judge. 

               Appearances:     Jeffrey J. Waller, Holmes Weddle & Barcott, 

               P.C.,   Anchorage,   for   Appellant.   Sarah   E.   Josephson   and 

               Cheryl     Mandala,     Jermain    Dunnagan      &   Owens,     P.C., 

               Anchorage,  for Appellee Public Employees Local 71 Trust 

               Fund.   No appearance by Appellee Crystal Sholin. 

               Before:    Carpeneti,    Chief   Justice,  Winfree    and  Stowers, 

               Justices.  [Fabe, Justice, not participating.] 

               WINFREE, Justice. 

               STOWERS, Justice, dissenting. 

----------------------- Page 2-----------------------


                A medical service provider filed but failed to serve a complaint against a 

former patient and her insurer.         The superior court dismissed the complaint without 

prejudice for lack of service.      Nearly a year later, the medical service provider filed a 

second     complaint   against   the   same   parties.   The   superior   court   granted   summary 

judgment dismissing that complaint, ruling that the medical service provider’s claims 

were barred by the statute of limitations and that Alaska’s savings statute, AS 09.10.240, 

did not apply because of failure to provide timely notice of the initial complaint.  The 

medical service provider appeals.         Because we conclude that AS 09.10.240 does not 

require   timely   notice   of   the   initial   complaint,   we   reverse   the   superior   court’s   order 

granting summary judgment and remand for further proceedings. 


                In 2005 American Marine Corporation d/b/a American Hyperbaric Center 

(American Hyperbaric) provided Crystal Sholin hyperbaric oxygen therapy treatments. 

Sholin     was   insured    by   Public   Employees      Local    71  Trust   Fund    (Trust   Fund), 

administered by Zenith Administrators, Inc. (Zenith).  American Hyperbaric asserts, but 

the Trust Fund disputes, that a Zenith representative gave American Hyperbaric oral 

authorization before Sholin was provided the treatments. 

                In June 2005 Zenith sent American Hyperbaric notice denying coverage for 

the   treatments.    American   Hyperbaric   requested   reconsideration,   and   Zenith   sent   a 

second denial.  Sholin appealed the denial to the Trust Fund, and the appeal was denied. 

In March 2006 American Hyperbaric sent Zenith a letter demanding payment for the 


                In February 2008 American Hyperbaric filed a complaint for breach of 

contract   against   Sholin   and   the   Trust   Fund,   but   did   not   serve   either   defendant.  In 

December 2008 the superior court dismissed the case for lack of service under Alaska 

                                                  -2-                                           6755

----------------------- Page 3-----------------------

Civil Rule 4(j).1     Nearly a year later American Hyperbaric refiled its complaint under 


Alaska’s savings statute, AS 09.10.240,  and properly served Sholin and the Trust Fund. 

                 The   Trust   Fund   moved   for   summary   judgment,   arguing   that   American 

Hyperbaric’s claims were time-barred.   The parties agreed that American Hyperbaric’s 

first complaint was filed within the statute of limitations and its second complaint was 

not.  The Trust Fund argued that American Hyperbaric should not be allowed to rely on 

the savings statute when no effort at service had been made and the Trust Fund had no 

actual notice of the initial lawsuit until after the statute of limitations expired.  American 

Hyperbaric argued that the savings statute does not require notice of the initial complaint. 

                 The superior court acknowledged that the savings statute requires only 

commencement   of   the   initial   suit,   but   ruled   that   plaintiffs   still   must   be   diligent   in 

providing notice to defendants. The court granted summary judgment to the Trust Fund, 

dismissed American Hyperbaric’s claims, and entered final judgment in favor of the 

Trust Fund. 

                 American Hyperbaric appeals. 


                 We review a grant of summary judgment de novo and affirm “when there 

are   no   genuine   issues   of   material   fact,   and   the   prevailing   party   .   .   .   was   entitled   to 

        1        Alaska   R.   Civ.   P.   4(j)   (providing   time   limit   for   plaintiff  to   serve   all 


        2        AS 09.10.240 provides in relevant part: 

                 If an action is commenced within the time prescribed and is 

                 dismissed upon the trial or upon appeal after the time limited 

                 for bringing a new action, the plaintiff . . . may commence a 

                 new action upon the cause of action within one year after the 

                 dismissal or reversal on appeal. 

                                                    -3-                                              6755

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judgment as a matter of law.” 3        “We review de novo questions of law, including the 

interpretation of a statute, adopting the rule of law most persuasive in light of precedent, 

reason, and policy.”4     Statutory interpretation begins with the plain meaning of the text, 

but it does not stop there.5   “Instead, we apply a sliding scale approach, where the plainer 

the   statutory   language   is,   the   more   convincing   the   evidence   of   contrary   legislative 

purpose or intent must be.”6 


                American Hyperbaric argues that AS 09.10.240’s plain language requires 

only that a plaintiff commence a suit by filing a complaint, and does not require timely 

notice to the defendants. The Trust Fund responds that AS 09.10.240’s purpose supports 

a notice requirement. 

                We begin with the plain meaning of AS 09.10.240.              The statute provides 

that a timely action dismissed other than on its merits may be refiled within one year of 

the initial action’s dismissal.7     The initial action must be “commenced within the time 

        3       Fraternal Order of Eagles v. City & Borough of Juneau , 254 P.3d 348, 352 

(Alaska 2011) (quoting Rockstad v. Erikson , 113 P.3d 1215, 1219 (Alaska 2005)). 

        4       Toliver v. Alaska State Comm’n for Human Rights, 279 P.3d 619, 622 

(Alaska 2012) (quoting Alaskans For Efficient Gov’t , Inc. v. Knowles , 91 P.3d 273, 275 

(Alaska 2004)). 

        5       State, Commercial Fisheries Entry Comm’n v. Carlson, 270 P.3d 755, 762 

(Alaska 2012). 

        6       Id. (quoting Gov’t Emps. Ins. Co. v. Graham-Gonzalez, 107 P.3d 279, 284 

(Alaska 2005)) (internal quotation and editing marks omitted). 

        7       See Alderman v. Iditarod Props., Inc., 104 P.3d 136, 142 (Alaska 2004) 

(providing savings statute “applies to all actions that are dismissed at the trial or appellate 

level other than those dismissed on their merits” (citing Smith v. Stratton, 835 P.2d 1162, 


                                                  -4-                                           6755

----------------------- Page 5-----------------------


prescribed,”  but the statute does not require notice or service of process as a prerequisite 

to refiling the action.9     Civil Rule 3(a) provides that “[a] civil action is commenced by 

filing   a   complaint   with   the   court.”10   Although   Rule   4   “contemplates   diligence   in 

procuring service of process,” it adds no condition to the commencement of an action.11 

Accordingly, the statute’s plain meaning requires only the filing of an initial complaint, 

not notice or service of the filing. 

                 We now consider the statute’s intent.            A savings statute’s purpose is to 

facilitate resolution of suits on the merits.12         This purpose supports the plain meaning 

interpretation of AS 09.10.240. We recognize a contrary interpretation is suggested from 

the notion that “if the primary purpose of the statute of limitations is to provide timely 

        7        (...continued) 

1165 (Alaska 1992))). 

        8        AS 09.10.240. 

        9        Cf.   OR .   REV .  STAT .  §  12.220 (providing   action   may   be   refiled   under 

Oregon’s savings statute “if the defendant had actual notice of the filing of the original 

action not later than 60 days after the action was filed”). 

        10       See also Silverton v. Marler, 389 P.2d 3, 6 (Alaska 1964) (“Diligence in 

procuring service of process is not involved in determining whether an action has been 


        11      Id.  at 5; see also Alaska R. Civ. P. 4(j) (requiring defendants be served 

within 120 days after complaint’s filing). 

        12       See, e.g., Furnald v. Hughes , 804 N.W.2d 273, 276 (Iowa 2011) (“The 

purpose of a savings statute is to prevent minor or technical mistakes from precluding 

a plaintiff from obtaining his day in court and having his claim decided on the merits.”); 

Hatley   v.   Truck   Ins.   Exch. ,   494   P.2d   426,   430   (Or.   1972)   (describing   purpose   of 

Oregon’s savings statute as “to avoid the bar of the statute of limitations for a diligent 

plaintiff    whose     timely   action    has  been    dismissed     over    his  objection    without     a 

determination on the merits”). 

                                                    -5-                                              6755

----------------------- Page 6-----------------------

notice to the defendant to enable him to preserve and collect his evidence, service of that 

notice would constitute commencement of the [initial] suit.”13  But although a statute-of­ 

limitations defense is legitimate, the defense “is not generally favored by the courts.”14 

And   our   general   policy   is   to   broadly   construe   the   rules   of   procedure   to   adjudicate 

disputes   on   the   merits.15     Accordingly,   we   conclude   that   AS   09.10.240’s   purpose 

supports its plain meaning — mere filing of the initial action without notice or service 

of process is sufficient.16 

                 The superior court found equitable tolling requirements to be “important 

in construing” AS 09.10.240; we disagree.              The equitable tolling doctrine is applicable 


80 (1978); see also   Kulinski v. Medtronic Bio-Medicus, Inc., 577 N.W.2d 499, 504 

(Minn.     1998)    (“Because      a  savings    statute  represents     an  exception     to  statutes   of 

limitations, we agree that a key to determining whether a subsequent action is saved is 

whether by invoking judicial aid in the original action, a litigant has given timely notice 

to his adversary of a present purpose to maintain his rights before the courts.” (quoting 

Gaines v. City of New York, 109 N.E. 594, 596 (N.Y. 1915)) (internal quotation and 

editing marks omitted)). 

         14      Jarvill v. Porky’s Equip., Inc. , 189 P.3d 335, 340 (Alaska 2008) (quoting 

Safeco Ins. Co. of Am. v. Honeywell, Inc., 639 P.2d 996, 1001 (Alaska 1981)). 

         15      Farmer v. State , 788 P.2d 43, 48 n.15 (Alaska 1990). 

         16      The   dissent   focuses   on   perceived   prejudice   to     the   Trust   Fund   in   this 

particular   case   to   conclude   that   notice   of   an   initial   complaint   should   always   be   a 

necessary predicate to later reliance on AS 09.10.240.   According to the Trust Fund, the 

Zenith employee who engaged in discussions with American Hyperbaric had not worked 

for Zenith for three years and had not been located by the time of its motion for summary 

judgment.     We note that demand for payment had been made over a year before the 

employee left Zenith, and even if American Hyberbaric had given notice of the initial 

complaint to Zenith and the Trust Fund, that notice would have come after the employee 

left Zenith’s employment; it also seems unlikely that the employee would not ultimately 

be found given the available resources for locating people.                   We believe   the alleged 

prejudice in this case is insufficient to create the general rule advocated by the dissent. 

                                                    -6-                                              6755

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“when a plaintiff has multiple legal remedies available” so that “[c]ourts will not force 

a   plaintiff   to  simultaneously   pursue   two   separate   and   duplicative   remedies.”17  In 

contrast, AS 09.10.240 allows a plaintiff to commence a second action pursuing the same 

remedy for the same cause of action.   While both toll a statute of limitations, they apply 

in distinct situations.   Accordingly, we refuse to graft the equitable tolling doctrine’s 

common-law requirements onto AS 09.10.240’s statutory requirements. 


               We REVERSE the superior court’s summary judgment order and remand 

for further proceedings. 

        17     Gudenau & Co. v. Sweeney Ins., Inc., 736 P.2d 763, 768 (Alaska 1987). 

                                                -7-                                            6755 

----------------------- Page 8-----------------------

STOWERS, Justice, dissenting. 

               I respectfully dissent from the court’s opinion.     The court concludes that 

Alaska’s savings statute, AS 09.10.240, does not require timely notice of the initial 

complaint to be served on the defendant.      I believe that timely notice is required, and I 

would affirm the superior court’s grant of summary judgment for the reasons that follow. 

               The   court   correctly  observes   that  other  courts  have  determined    that 

“[b]ecause a savings statute represents an exception to statutes of limitation, . . . a key 

to determining whether a subsequent action is saved is whether by invoking judicial aid 

in the original action, a litigant has given timely notice to his adversary of a present 

purpose to maintain his rights before the courts.”1       The court also cites to Professor 

Ferguson’s  The Statutes of Limitation Saving Statutes2 which explains that “courts in 

applying the saving statute should do so in accordance with the basic purpose of the 

statutes of limitations” and “[t]he saving statute is a part of the law of limitations of 

action and, therefore, should be construed and applied in accordance with the primary 

policy of the statutes of limitation.”3 

               After conducting an historical analysis of the origin and purposes of statutes 

of   limitation,  Professor   Ferguson    identifies  three  possible   purposes   or  interests 

underlying the statutes of limitations:    the public’s interest, the plaintiff’s interest, and 

the defendant’s interest. Ferguson first concludes that the public’s interest in suits being 

timely brought is valid but not of substantial weight (apart from real property actions): 

       1       Slip Op. at 6 n.13 (quoting Kulinski v. Medtronic Bio-Medicus, Inc ., 577 

N.W.2d 499, 504 (Minn. 1998) (quoting Gaines v. City of New York, 109 N.E. 594, 596 

(N.Y. 1915))). 

       2       Slip   Op.   at   6   n.13   (citing   WILLIAM D.  FERGUSON , THE STATUTES   OF 

LIMITATION  SAVING  STATUTES 80 (1978) (hereafter “Ferguson”)). 

       3       Ferguson at 5. 

                                              -8-                                         6755

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                  Of course, the public has an interest that suits be promptly 

                 brought and controversy should be ended either by suit or by 

                  time.   But such a vague value can hardly be weighed in the 

                  scales   of   justice  vis-a-vis   the   interests   of   the    parties.    It 

                  therefore is difficult to find any persuasive reason to conclude 

                  that   the   statute   enacted   was   for   the   benefit   of   the   public 

                  except as to real property actions where that interest should 

                 be given some consideration.[4] 

Ferguson next rejects that the plaintiff’s interest should be given any significant weight, 


                  Although   the   public   interest   is   entitled   to   be   given   some 

                  weight,   it   is   doubtful   that   any   support   can     be  found   for 

                  adopting the statutes to compel plaintiffs to sue promptly.  If 

                  only    the   plaintiff   is  considered      and    the  interests    of  the 

                  defendant       and     public     excluded,      there    is   nothing      to 

                  recommend         a  coercion     for   coercion’s     sake    purpose.      If 

                 plaintiff wished to assume the risk that his witnesses would 

                  die or his evidence be lost, it does not seem appropriate to say 

                  he cannot run that risk.[5] 

                  Finally, Ferguson identifies the true purpose underlying the statutes   of 

limitations:     to protect the defendant’s interest. 

                  The only other interest involved is that of the defendant.  The 

                  defendant,      unlike    the   plaintiff,   has    no   control    over   the 

                 bringing of the action and thus no chance to avoid the risk of 

                  the death of witnesses or the loss of evidence. . . . 

                                                       . . . 

                  [I]t logically appears that the primary purpose of the statutes 

                  was    to   protect    defendant      against    loss   of  witnesses      and 

                  evidence   and   to   protect   his   acts   in   reasonable   reliance   on 

                 plaintiff’s inaction.  The public interest was furthered by the 

         4       Id . at 41. 

         5       Id . at 42. 

                                                       -9-                                                 6755 

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                 protection      of  the  defendant’s     interest   and   should    not   be 

                 permitted to override those interests.  The interest in fair and 

                 equal justice could be served only by assuring defendants that 

                 suit   would   be   commenced   before   witnesses   and   evidence 

                 were lost. . . .    Likewise, the purpose of compelling plaintiff 

                 to bring suit is really only valid as it relates to the protection 

                 of defendant’s interests.  Coercion for the sake of coercion is 

                 invalid but coercion to protect others from the harm resulting 

                 from plaintiff’s propensity to delay suit has meaning and is 


                 These considerations are clearly illustrated in the case at bar.  The superior 

court determined that the defendant would be prejudiced by plaintiff’s delay in filing suit 

because a critical witness (an employee who allegedly entered into the oral contract with 

plaintiff) had not worked for the employer in over three years and had not been located. 

The plaintiff, appellant herein, does not challenge this ruling   and it is supported by 

affidavits submitted with the defendant’s motion for summary judgment.  Thus the court 

was faced with a situation where the plaintiff filed suit, but failed to serve the defendant 

within the statute of limitations, and then sought to revive its action by relying on the 

savings statute, even though plaintiff’s delay actually prejudiced the defendant’s ability 

to present its defense.7 

                 The superior court interpreted the savings statute in light of its purpose, 

reasoning that its purpose was to provide an exception to the statute of limitations for the 

diligent plaintiff whose timely action was dismissed without reaching the merits of the 

action:   The court concluded, “In light of the purpose of the statute, a party who wishes 

to   invoke   the   savings   statute   to   save   his   action   still   must   be   diligent,   and   diligence 

         6       Id . at 42-44. 

         7       The   court   attempts   to     avoid   this  uncontested      finding  of   prejudice   by 

engaging in its own weighing of the evidence, which is inappropriate for an appellate 

court to do.    Slip Op. at 6 n.16. 

                                                    -10-                                                  6755 

----------------------- Page 11-----------------------

requires notice to opposing parties.”             I believe the superior court’s analysis is exactly 

right and this court is wrong in reversing the superior court. 

                  This court relies on truisms to avoid dealing with the real purposes of the 

statute of limitations and the savings statute.  The court says that the statute’s purpose is 

“to   facilitate   resolution   of   suits   on   the   merits,”8  which   is   to   say   that   its   purpose   is 

remedial; that the statute of limitations defense is not favored by the courts;9  and that it 

is our general policy to broadly construe rules of procedure to adjudicate disputes on the 

merits.10     This   is   all   well   and   good,   but   it   is   neither   analytical   nor   persuasive.   As 

Professor Ferguson explains: 

                  To say, as some courts have, that the statute is remedial is to 

                  state the obvious but sheds little light on what it is   that is 

                  being remedied and why the remedy is appropriate.                     Others 

                  have   identified   the   purpose   as   being   to   protect   plaintiffs 

                  against the loss of their causes of action because of technical 

                  matters of procedure and matters of form.                This sounds fine 

                  but   may   lead   to   some   questionable   extensions   where   the 

                  purpose of the statute of limitations has not been satisfied, 

                  e.g., the defendant did not receive notice within the limitation 

                  period.  Others have said the same thing by concluding it was 

                  the purpose of the legislature   to insure trial on the merits. 

                  This likewise may turn out to be too broad in some instances 

                  for failure to look at the purpose of the procedural rule which 

                  caused plaintiff’s downfall. 

                                                       . . . 

                          Some       of  the  courts    have,    however,      looked    to   the 

                  purpose of the statutes of limitations as the savings statutes 

                  relate    thereto    and    have    looked     to   see   whether     or   not 

         8        Slip Op. at 5. 

         9       Id . at 6. 

         10      Id . 

                                                      -11­                                                    6755 

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                 defendant received notice of the claim within the period of 

                 limitations.   The position taken by Judge Cardozo in one of 

                 the leading and most frequently cited cases, Gaines v. City of 

                 New York , stands as strong a beacon to guide others in the 

                 interpretation of a saving statute: 

                         The statute is designed to insure to the diligent 

                         suitor   the   right   to  a   hearing   in  court   till   he 

                         reaches a judgment on the merits. Its broad and 

                         liberal purpose is not to be frittered away by 

                         any     narrow     construction.       The     important 

                         consideration is that, by invoking judicial aid, a 

                         litigant gives timely notice to his adversary of a 

                         present purpose to maintain his rights before the 


                 Because plaintiff in   this case was not diligent and failed to give timely 

notice to the defendant — which predictably caused prejudice to the defendant through 

loss of a witness and evidence — I conclude that the purposes underlying both the statute 

of limitations and the savings statute are not advanced by permitting plaintiff to invoke 

the savings statute to revive its action. I would affirm the superior court’s ruling denying 

the plaintiff its plea to invoke the savings statute. 

        11       Ferguson at 56-58 (quoting Gaines v. City of New York, 109 N.E. 594, 596 

(N.Y. 1915) (other citations omitted)). 

                                                   -12-                                                 6755 

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