In Litigation, Details Matter – Lawyers Must Remember the Fundamentals
At the outset of each lawsuit, the lawyers need to formulate a big-picture strategy. They need to then navigate the lawsuit using that strategy as a compass. But the devil is in the details – and the buck stops with the lawyers. A new case out of the Washington Court of Appeals, Spencer v. Franklin Hills Health-Spokane, LLC, illustrates the need to do the little things right.
The Case – Facts
Ms. Spencer filed a personal injury lawsuit against a health care provider, Franklin Hills Health. Spencer’s process server, named Mr. Kenworthy, attempted to serve the lawsuit on the “registered agent” for Franklin Hills, named Tolman. A registered agent is someone appointed to receive service of lawsuits and subpoenas. The easiest way to start a lawsuit against a company is usually serving the registered agent. That is usually uncomplicated, because the identity of the registered agent is public record. But in the Spencer v. Franklin Hills lawsuit, when registered agent Tolman was unavailable, Kenworthy served the human resources and payroll manager, Flavel. Flavel did not tell Kenworthy whether she was authorized to accept such service. The issue on appeal: Whether Flavel was a proper person to accept service for the company under RCW 4.28.080(9).
Washington State’s Service Requirements – RCW 4.28.080(9)
In serving lawsuits, lawyers must ensure the process servers strictly comply with RCW 4.28.080(9). See Witt v. Port of Olympia, 126 Wn. App. 752, 757, 109 P.3d 489 (2005).
RCW 4.28.080(9) states:
“[s]ervice made in the modes provided in this section is personal service. The summons shall be served by delivering a copy thereof, as follows: (9) If against a company… to the president or other head of the company or corporation, the registered agent, secretary, cashier or managing agent thereof or to the secretary, stenographer or office assistant of the president or other head of the company or corporation, registered agent, secretary, cashier or managing agent” (emphasis added).
In short, “the service statute for corporations [and companies] communicates the Legislatures’ decision that only persons holding in certain positions can accept service on behalf of a corporation.” See Crystal, China & Gold, Ltd. V. Factoria Ctr. Invest., Inc., 93 Wn. App. 606, 608, 969 P.2d 1093 (1999). Consequently, service on individuals not specifically named in RCW 4.28.080(9) renders service ineffective upon a corporation or company.
The Case – Ruling
Luckily for Spencer and her lawyer, the Court of Appeals held that Flavel was both a “managing agent” and an “office assistant” for purposes of RCW 4.28.080(9) – thus Flavel was a suitable person to accept Spencer’s service.
Flavel met the Court’s definition of ‘managing agent’, because the Court defined a ‘managing agent’ as someone “in charge of, or have managerial authority over the corporation’s property, business, or affairs in a particular locality, branch, division, or significant department of the corporation’s operations.”
Flavel also met the Court’s definition of “office assistant”, because she “worked under the direct supervision of the registered agent and executive director and, as the human resource manager, would be responsible for ensuring that important communications are delivered to those persons.” Therefore, under either term, Flavel was a suitable person to accept service on behalf of the company.
Had Spencer lost, her statute of limitations would likely have expired, preventing her lawsuit entirely.
The Lesson
While Spencer eventually won the appeal, the lesson from this case is clear: Do the little things right. In the service-of-process example, avoid drama – and the significant time, risks, and financial costs of an appeal – by simply serving a person clearly authorized by the statute to receive service. Lawyers must take ownership of the entire case, ensuring proper completion of simple details such as service. Those simple details can be the difference between winning and losing.
To learn more about In Litigation, Details Matter – Lawyers Must Remember the Fundamentals, please contact Beresford Booth at info@beresfordlaw.com or by phone at (425) 776-4100.
