Thursday, February 09, 2006

Time to file notice of claim under Government Immunity Act not tolled by discovery rule

Cedar Professional Plaza, L.C. v. Cedar City Corp., 2006 UT App 36

Cedar Professional Plaza (“CPP”) sought to use the discovery rule to circumvent the one-year statute of limitations for filing a claim under the Utah Governmental Immunity Act (“the Act”). The trial court refused to apply the discovery rule and dismissed CPP’s complaint. The court of appeals affirmed.

CPP’s property was flooded when a pipe burst at a construction project supervised by Cedar City and on city property. CPP filed two notices of claim against Cedar City within the one-year period, but filed them with the wrong government agent (the proper agent was the city recorder). Thinking it had complied with the notice requirements of the Act, CPP then filed a civil lawsuit against the city under a theory of supervisory negligence. But since CPP had not strictly complied with the notice requirements of the Act, the trial court dismissed the action.

After the dismissal, and almost two and half years after the flood, CPP filed a new notice of claim with the city recorder and commenced a new action against the city in district court. The new complaint alleged both supervisory negligence and direct negligence. The city moved for summary judgment because the notice was filed more than one-year after the flood. CPP argued that the notice was timely under the discovery rule because it was filed within one year of when CPP learned of the facts which formed the basis for its direct negligence claim. The trial court disagreed with CPP and dismissed the complaint. CPP appealed.

The court of appeals affirmed. It held that the discovery rule did not apply to CPP’s claim, because CPP did not need to know about the city’s direct negligence to file a notice of claim. The court explained that the notice of claim did not need to meet the standards required to plead a claim for relief. It only had to inform the government of the nature of the claim, so the government could appraise its potential liability. The court noted that if CPP had filed its first notice with the correct agent, it could have later amended its complaint to include a cause of action for direct negligence.

The court also held that there was nothing exceptional about CPP’s case that warranted tolling the time under the equitable discovery rule. CPP knew from the start that it would have a claim against the city, but simply failed to properly notify the city.


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