text:
    William E. CARROLL, Jr., Appellant, v. Rizaldo MARTIR, E & E Investment Co. and C.R. England & Sons, Inc., Appellees.
    No. 98-1907.
    Supreme Court of Iowa.
    April 26, 2000.
    Rehearing Denied May 31, 2000.

      Jerry R. Foxhoven, Des Moines, for appellant.
    James A. Pugh of Morain, Burlingame & Pugh, P.L.C., West Des Moines, for appel-lees.

       NEUMAN, J., taking no part.

   LAVORATO, Justice.

In this personal injury action, the plaintiff appealed from a district court ruling dismissing his petition for failing to serve the defendants in a timely manner. We transferred the case, to the court of appeals, which reversed and remanded. We vacate the court of appeals decision and affirm the district court judgment.

I. Background Facts and Proceedings.

On January 18, 1996, William E. Carroll, Jr. of Crystal Springs, Missouri, was in a motor vehicle accident in Polk County, Iowa. An officer of the Iowa State Patrol investigated the accident. In his report, the officer noted that Carroll’s tractor-trailer was rear-ended by another tractor-trailer driven by Rizaldo A. Mártir of “1412 Stancrest Ln., National City, CA 91950.” The report listed “E & E Investment Co., CR England & Sons, Inc.” of “4701 W. 2100 South W. Valley City, Utah, 84120” as the owners of the truck Mártir was driving.

On February 9 Gary Toomb, claims administrator for C.R. England & Sons, Inc., faxed Carroll, asking him to “Please sign authorization and fax back to me ASAP.” The fax listed the address of “C.R. England & Sons, Inc.” as “4701 West 2100 South Salt Lake City, Utah 84120.”

On February 12 Don H. Evans, an attorney in Jackson, Mississippi, faxed Toomb a letter ■ that he was representing Carroll. On the same day, Evans sent the letter of representation through the mails. The letter put Toomb and C.R. England & Sons, Inc. on notice that Carroll had retained Evans to represent Carroll for injuries and damages Carroll had sustained in the January 18,1996 accident.

On February 15 Toomb and Evans talked by phone. Toomb told Evans that he had made Carroll a $7500.offer to settle and. that the offer was still open. The following day Toomb wrote Evans a letter' confirming the phone, conversation and asking if the offer was agreeable.

These settlement negotiations between Toomb and Evans continued until June 13, at which time Evans, in a letter, made- a demand of $125,000 to settle the case. In a letter dated June 21, Nelson L. Hayes, general counsel for C.R. England & Sons, Inc., notified Evans that he had taken over the matter and wished to continue settlement negotiations and suggested mediation.

On December 11, 1997, attorney Jerry Foxhoven filed a lawsuit on behalf of Carroll against Mártir, E & E Investment Co., and C.R. England & Sons, Inc. Foxhoven filed the lawsuit in Polk County, Iowa. The lawsuit sought personal injury and property damages from the defendants arising out of the January 18, 1996 accident. The petition was filed approximately one month before the expiration of the two-year statute of limitations. See Iowa Code § 614.1(2) (1997). .

Meanwhile, settlement negotiations apparently continued at least until May 26, 1998, when J. Ashley Ogden, an attorney in Evans’ law firm, wrote a letter to Hayes in which he stated:

Enclosed please find a courtesy copy of the Complaint filed by local counsel, Jerry Foxhoven. Please forward your offer in writing so that we may negotiate settlement without further litigation expense.
Further, any answer to the Complaint should be sent to Jerry Foxhoven....

On June 5 Carroll, through Foxhoven, filed a “Motion for leave to extend time for service of process.” The motion alleged that Foxhoven had (1) been retained shortly before the statute of limitations had run, (2) identified the defendants through the accident report, (3) not located a proper person or agent for the service of process on the corporate defendants despite expenditure of great time and energy, and (4) hired a private investigator to locate an agent for service and the investigator had apparently discovered the identity of the agent. The motion asked that the court enter an order (1) finding that good cause exists to extend the time for service of process and (2) extending the time for service until June 26,1998.

The same day, the district court entered an ex parte order sustaining the motion. The court (1) found that Carroll had established good cause for an extension and (2) authorized an extension until June 26, 1998.

On June 24 Foxhoven served all three defendants pursuant to Iowa Code section 321.501. Section 321.501 permits a nonresident involved in a motor vehicle accident in Iowa to be served

[b]y filing a copy of said original notice of suit with [the director of transportation] ... and
,..[b]y mailing to the defendant, and to each of the defendants if more than one, within ten days after said filing with the director, by restricted certified mail addressed to the defendant at the defendant’s last known residence or place of abode, a notification of the said filing with the director.

On June 24, pursuant to section 321.501, Foxhoven mailed a copy of the notification to Rizaldo Mártir at his California address as listed on the accident report. Mártir acknowledged receipt. Foxhoven also mailed a copy of the notification to Keith Walus, Jr., as registered agent for E & E Investment Co. and C.R. England & Sons, Inc. at 4701 W. 2100 South, Salt Lake City, Utah. Walus acknowledged receipt of the notification for both companies.

On July 16 all three defendants filed a motion to dismiss. They alleged a 195-day delay between the filing of the petition on December 11, 1997, and service of the original notice on June 24, 1998. They further alleged the delay was presumptively abusive in violation of Iowa Rule of Civil Procedure 49 and warranted dismissal of the action.

On August 7 Carroll filed a resistance to the motion to dismiss. The motion alleged that (1) the cases the defendants cited in their motion to dismiss arose before the implementation of Iowa Rule of Civil Procedure 49(f); (2) rule 49(f) provides that service must occur within ninety days or, if good cause is shown for failure to provide the service, the court shall extend the time for an appropriate period; (3) Carroll previously set forth good cause for extending the time for his service in his previously filed motion for leave to extend time for service; (4) the court found good cause and extended the time for service up to and including June 26, 1998; and (5) Carroll effected service on all the defendants before June 26, 1998.

Foxhoven also filed his affidavit in support of the motion. Foxhoven stated that (1) upon filing the petition he checked with the Iowa Secretary of State and found no listing for C.R. England & Sons, Inc. or E & E Investment with that office, and (2) he took the names of the defendants from the accident report in this case. He also stated that he contacted a private investigator to locate the registered agents for the corporate defendants but gave no date as to when he contacted the investigator.

Foxhoven further stated that (1) the private investigator reported that there was a C.R. England & Sons, Inc. that had been registered as a corporation in Illinois, and the registered agent for the corporation was Philip Lee at 33 N. Deerborn, Suite 2400, Chicago, Illinois 60602; (2) the private investigator also reported 'that the State of Illinois had revoked the license of C.R. England &. Sons, Inc. for failure to file an annual report and that there was no listing found for E & E Investment Company; (3) he — Foxhoven—continued, to search for the correct location of the corporate defendants; (4) the private investigator found that C.R. England, Inc. — a corporation similar in name as the defendant listed in the accident report — was incorporated in Salt Lake City, Utah, and its registered agent was Keith Walus," Jr. at 4701 West 2100 South, Salt Lake City, Utah, 84120; and (5) the private investigator determined that C.R. England & Sons, Inc. had been incorporated in Utah in 1960 and that the corporation in Illinois had changed its name in Illinois from C.R. England & Sons, Inc. to C.R. England, Inc. Foxhoven also stated that he learned this information about the Salt Lake City corporation in June 1998.

The defendants filed a reply to Carroll’s resistance and alleged that Carroll was aware of the defendants’ addresses since February 1996. In support of this allegation, the defendants attached the correspondence, previously referred to, between Carroll’s Mississippi lawyer and the claims representative for C.R. England & Sons, Inc.

The defendants also alleged in their reply that, on May 26, 1998 (166 days after the plaintiff had filed his petition), the plaintiffs Mississippi lawyer mailed a “courtesy copy” of his petition to the corporate defendants’ general counsel. The defendants attached to their reply a copy of the cover letter that had accompanied the courtesy copy of the petition. The defendants further alleged that, on June 5, 1998 (176 days postfiling), the plaintiff — ex parte — filed for, and was improperly granted, an extension of time to obtain service on the defendants.

Following a hearing on the motion to dismiss, the district court (the same judge who had granted Carroll’s motion to extend time for service) granted the defendants’ motion to dismiss. The court found that the 195-day delay between the filing of the action and service of the original notice was “presumptively abusive of the guidelines set forth in R.C.P. 49.” The court also found that the facts contained in Foxhoven’s affidavit, “when viewed in conjunction with the documentary evidence attached to the defendants’- reply, do not constitute adequate justification for the delay in this case.” The court dismissed the petition against all the defendants.

Following Carroll’s appeal from this latest ruling, we transferred the case to the court of appeals. The court of appeals reversed and remanded as to all three defendants. The court of appeals found that the district court’s finding of inadequate justification for the delay in service was not supported by substantial evidence.

We granted the defendants’ application for further review in which they contend that, contrary to the ' court of appeals, there- was substantial evidence to support the district court’s finding that there was inadequate justification for the delay in service.

II. Whether There Was Substantial Evidence to Support the District Court’s Finding of Inadequate Justification For the Delay in Service.

A. Matters outside the pleadings. Motions to dismiss under Iowa Rule of Civil Procedure 104(b) (failure to state a claim on which any relief can be granted) are generally limited to the pleadings, and facts outside the pleadings are not to be considered. Estate of Dyer v. Krug, 533 N.W.2d 221, 223 (Iowa 1995). Summary judgment is the appropriate remedy when parties wish to rely on facts outside the pleadings. Id.

Nevertheless, we have permitted a resort to facts outside the pleadings when (1) those facts arise after the plaintiff has filed the petition, (2) the parties do not dispute those facts, and (3) the issues in the motion to dismiss do not concern the adequacy of the petition to state a claim for relief. Id.

Here, the district court did consider matters outside the pleadings when it granted the defendants’ motion to dismiss. However, neither party voiced objection to this procedure. See Berger v. General United Group, Inc., 268 N.W.2d 630, 634-35 (Iowa 1978) (matters outside the pleadings considered when parties voiced no objection to such procedure in the district court).

Additionally, a motion to dismiss for delay of service falls within the category of motions to dismiss that do not address the pleadings. We note that, in several cases in which delay in service was the issue, the district court and this court on appeal resorted to matters outside the pleadings in deciding the issue. See, e.g., McCormick v. Meyer, 582 N.W.2d 141, 145-46 (Iowa 1998); Henry v. Shober, 566 N.W.2d 190, 191 (Iowa 1997); Alvarez v. Meadow Lane Mall Ltd. Partnership, 560 N.W.2d 588, 589 (Iowa 1997). We therefore consider here matters outside the pleadings raised in the motion to dismiss, the resistance, the reply to the resistance (including documents submitted in support of the resistance), and Foxhoven’s affidavit in support of the resistance to the motion to dismiss.

B. Rule 49, amendment to rule 49, and scope of review. Pursuant to Iowa Rule of Civil Procedure 48, a plaintiff commences a lawsuit by filing a petition. When Carroll filed his lawsuit in December 1997, Iowa Rule of Civil Procedure 49 was in effect. Subsection (a) of the rule provides in relevant part:

Written directions for the service of the original notice and copy of petition shall be delivered to the clerk with the petition. There shall also be delivered to the clerk with the petition the original notice to be served and sufficient copies of both.

Iowa Rule of Civil Procedure 49(b) directs that “[u]pon the filing of the petition the clerk shall forthwith deliver for service the original notice and copies, copies of the petition, and the directions for service to the sheriff, to a person specially appointed to serve it, or other appropriate person.” Iowa R. Civ. P. 49(b) (emphasis added).

Rule 49 set no time limit within which service was to be accomplished. However, we have interpreted the rule as requiring dismissal of an action if there was an unjustified abusive delay in completing service. See McCormick, 582 N.W.2d at 145. Whether the delay was justified involved determining whether good cause existed for the delay. Id.

On January 24, 1998 — one month after Carroll filed his petition — rule 49 was amended by adding subsection (f), which provides:

If service of the original notice is not made upon the defendant, respondent, or other party to be served within 90 days after filing the petition, the court, upon motion or its own initiative after notice to the party filing the petition, shall dismiss the action without prejudice as to that defendant, respondent, or other party to be served or direct an alternate time or manner of service. If the party filing the papers shows good cause for the failure of service, the court shall extend the time for service for an appropriate period.

The district court granted the defendants’ motion to dismiss under our cases interpreting rule 49 as it existed before the amendment. Neither party ot> jected. Neither party filed an Iowa Rule of Civil Procedure 179(b) motion to preserve the issue that the amendment should apply. Lawrence v. Grinde, 534 N.W.2d 414, 418 (1995) (holding that party must file a motion to amend and enlarge under rule 179(b) in order to preserve an issue for appeal when the court fails to resolve an issue, claim, defense,- or legal theory properly submitted to it for adjudication). We therefore decide .this ease under the cases interpreting rule 49 as it existed before the amendment.

Our review of a district court ruling on a motion to dismiss for failure to serve in a timely manner an original notice pursuant to rule 49 is for correction of errors at law. McCormick, 582 N.W.2d at 144. In circumstances in which, as here, the district court has made findings of fact, those findings are binding on appeal unless they are not supported by substantial evidence. Id. However, neither the district court’s application of legal principles nor the court’s conclusions of law are binding on appeal. Id.

C. The' merits. Before proceeding to the merits, we must first address Carroll’s contention that the district court should not have dismissed the case because (1) the court had previously made the findings contemplated by the rule, (2) the court granted the extension for a period of time, and (3) Carroll complied with the order.

We have long recognized that a district court has the power to-correct its own perceived errors, “so long as the court has jurisdiction of the case and the parties involved.” McCormick, 582 N.W.2d at 144. Until the district court has rendered a final order or decree, it has the power to' correct any of the rulings, orders or partial summary judgments it has entered. Hayes v. Kerns, 387 N.W.2d 302, 308 (Iowa 1986). In short, a party has no vested interest in an erroneous ruling. Davenport Bank & Trust Co. v. City of Davenport, 318 N.W.2d 451, 455 (Iowa 1982).

Here, the district court’s initial order extending time was not a final "order. Compare Wesley Retirement Servs., Inc. v. Hansen Lind Meyer, Inc., 594 N.W.2d 22, 28 (Iowa 1999) (noting that a final judgment or decision is “one that finally adjudicates the rights of "the parties”), with Recker v. Gustafson, 271 N.W.2d 738, 739 (Iowa 1978) (holding that a ruling is merely interlocutory if it is not finally .decisive of the casé). Nor had the district court entered a final order or judgment in the case before granting the motion to dismiss. Additionally, when the court did grant the motion to dismiss, it had jurisdiction of the case and the parties.

The defendants correctly assert that the district court was hot prohibited from revisiting its earlier determination that justification existed for the delay of service in this case. The authority to do so is particularly appropriate in circumstances in which, as here, the initial ruling is made ex parte. Simply put, it would seem appropriate for a court to revisit a prior ex parte ruling • once all the relevant parties are before it.

As mentioned, dismissal is required if there is an unjustified abusive delay in completing service. McCormick, 582 N.W.2d at 145. Determining whether there is such a delay requires the following analysis. If there is a delay in service, the district court must first decide if the delay was presumptively abusive. Id. If the court finds the delay is presumptively abusive, the court must then decide if the plaintiff has shown the delay was justified. Id. If the district court finds the delay was not justified, the court must dismiss the case. Id. In doing the analysis, the district court must keep in mind that once the petition is filed the plaintiff has the burden of making sure that the service of the original notice and petition is both proper and timely. Id.

We have equated justification for delay in service to good cause. Id. Good cause requires that

“[t]he plaintiff must have taken some affirmative action to effectuate service of process upon the defendant or have been prohibited, through no fault of his [or her] own, from taking such an affirmative action. Inadvertence, neglect, misunderstanding, ignorance of the rule or its burden, or half-hearted attempts at service have generally been waived as insufficient to show good cause. Moreover, intentional nonservice in order to delay the development of a civil action or to allow time for additional information to be gathered prior to ‘activating’ the lawsuit has been held to fall short of ... good cause.... ”

Henry, 566 N.W.2d at 192-93 (quoting Vincent v. Reynolds Mem’l Hosp., Inc., 141 F.R.D. 436, 437-38 (N.D.W.Va.1992)). Additionally, we have recognized that a lengthy delay is indicative of a plaintiff who has filed a petition “not to seriously institute litigation, but rather to ‘ice’ the statute of limitations for a later determination on whether to proceed with suit.” Alvarez, 560 N.W.2d at 591.

With these principles in mind, we proceed to consider whether there was substantial evidence to support. the district court’s finding that inadequate justification existed 'for the delay in service. (It is undisputed that the delay was presumptively abusive.) This case involves service of process upon three separate defendants: Rizaldo Mártir, E & E Investment Co., and C.R. England & Sons, Inc. We address each in turn.

1. Mártir. Carroll’s primary contention throughout this case has been that he, through his attorney, was unable to locate a “proper person or agent for service of the corporate defendants.” Setting aside for the moment the corporate defendants, Carroll gives no explanation why he needed additional time to serve Mártir in his individual capacity.

The record shows that Mártir was served under the same name and the same address as that shown in the January 1996 accident report. Carroll offered no reason to the district court explaining why he had failed to serve notice on Mártir in a timely manner. Nor has he offered us any reason. As mentioned, Carroll has this burden. There was, therefore, substantial evidence supporting the district court’s finding that inadequate justification existed for the delay in service of the original notice and petition on Mártir.

To the extent that the court of appeals found justification for the delay in serving the original notice and petition upon Már-tir, we vacate this portion of its decision and affirm the district court ruling.

2. C.R. England & Sons, Inc. As to C.R. England & Sons, Inc., the record is clear that Carroll knew the location of this corporate defendant as early as February 9, 1996 — less than a month after the accident. On that date, the claims representative for C.R. England & Sons, Inc. sent a fax to Carroll, and that fax had the company’s name and address on it.

Additionally, Carroll, through his Mississippi counsel, had been in settlement negotiations with C.R. England & Sons, Inc. since early February 1996. The record clearly shows that Carroll’s Mississippi counsel knew the name and address of C.R. England & Sons, Inc., as indicated by the names and addresses shown in the repeated written correspondence between the Mississippi counsel and C.R. England & Sons, Inc.

It is true we have no direct evidence that Foxhoven had actual knowledge that Mississippi counsel had located C.R. England & Sons, Inc. and had been involved in settlement negotiations with the company. However, we think the district court could reasonably infer that Foxhoven had such knowledge. It seems incredulous to us that Mississippi counsel would neglect to give Foxhoven this information.

In any event, Carroll, not Foxhoven, is ultimately responsible for accomplishing service. The question, therefore, is not simply what Carroll’s Iowa counsel may or may not have known, but rather what Carroll himself knew. • ■ ‘

The rule is that a client is charged with knowledge of matters known to the chent’s attorney, which matters the attorney learns through the course of representing the client. In short, knowledge of an attorney is knowledge of' the client. Nachazel v. Mira Co. Mfg., 466 N.W.2d 248, 252-53 (Iowa 1991); State v. Roghair, 390 N.W.2d 123, 125 (Iowa 1986); Perpetual Sav. & Loan Ass’n v. Van Atten, 211 Iowa 435, 437-39, 233 N.W. 746, 747 (1930); see 7A C.J.S.. Attorney & Client § 180 n.57, at 284 (1980) (noting that attorney acts as the representative and alter ego of his client). There are several exceptions to the rule, but none apply here. See Moser v. Thorp Sales Corp., 312 N.W.2d 881, 888 (Iowa 1981).

As mentioned, Carroll’s ' Mississippi counsel knew the correct name and address of C.R. England & Sons, Inc. The law imputes that knowledge to Carroll. Therefore, as a matter of law, Carroll knew the location of C.R. England & Sons, Inc. Carroll can offer no justification for a prolonged search and delay in,the service of the original notice and petition on this corporate defendant. There was therefore substantial evidence to support the district court’s finding that inadequate justification existed for the delay in service. The court of appeals erred in concluding otherwise. We must therefore vacate the court of appeals decision as to this defendant and affirm the district court ruling;

3. E & E Investment Co. Although we uphold the district court’s ruling as to E & E Investment Co. on a different basis, the following discussion applies, with equal force to C.R. England & Sons, Inc.

Carroll waitéd nearly 175 days after he filed his petition before asking for an extension of time. The district court could reasonably infer that Carroll had done nothing until then to serve E & E Investment. (Foxhoven’s resistance and affidavit give no hint as to when he hired thé investigator or began seriously searching for the location of this corporate defendant.) Carroll had the burden to show that he tried to serve the defendants in a reasonably short period of time after the petition was filed.

Additionally, had Carroll simply used the nonresident motorist statute immediately, using the last known address, he might have been successful in effectuating service. (We are mindful that such service is not good unless the defendant’s actual location is established. See Emery Transp. Co. v. Baker, 254 Iowa 744, 749-50, 119 N.W.2d 272, 276 (1963)). The address for the two defendants as it appears in the accident report was 4701 W. 2100 South W. Valley City, Utah, 84120. The actual address is 4701 W. 2100 South, Salt Lake City, Utah 84120. Given this degree of similarity, service under the nonresident motorist statute might have been successful. Again, Carroll had the burden to show that he at least tried to serve E & E Investment under the nonresident motorist statute in a reasonably short period of time after the petition was filed.

Contrary to the court of appeals, we conclude there was substantial evidence to support the district court’s finding that there was inadequate justification for delay in service as to E & E Investment. We therefore vacate the court of appeals deeision as to this defendant and affirm the district court ruling.

The 195-day delay in serving the defendants together with the totality of the circumstances suggests an attempt to “ice” the statute of limitations so that more time could be given to settlement negotiations. See Alvarez, 560 N.W.2d at 591 (holding that any delay in service beyond 120 days “indicates the plaintiff filed the petition, not to seriously institute litigation, but rather to ‘ice’ the statute of limitations for a later determination on whether to proceed with suit”). Under the facts here, we think the district court would have been justified in so finding.

III. Disposition.

In sum, we conclude there was substantial evidence to support the district .court’s finding that there was inadequate justification for the delay in service on all three defendants. The district, court therefore correctly dismissed the plaintiffs petition. We vacate the court of appeals decision to the contrary and affirm the district court judgment.

DECISION OF COURT OF APPEALS VACATED; DISTRICT COURT JUDGMENT AFFIRMED.


source: Caselaw Access Project

author: CADY, Justice.

license: Public Domain

text:
    Dean OWENS, Appellant, v. John BROWNLIE and Donna Brownlie, Appellees.
    No. 98-1133.
    Supreme Court of Iowa.
    April 26, 2000.
    Rehearing Denied May 31, 2000.

      Morris L. Eekhart of Milroy, Eckhart and Thompson, Vinton, for appellant.
    Ross Hauser of Shea Law Offices, Cedar Rapids, and Keith Mossman of Mossman and Mossman, L.L.P., Vinton, for appel-lees.

       NEUMAN, J., taking no part.

   CADY, Justice.

This is an appeal from an order by the district court dismissing an action for declaratory judgment and injunctive relief filed in response to the condemnation of land. We affirm.

I. Background Facts and Proceedings.

Dean Owens is the brother of Donna Brownlie. Their family has owned a 200-acre farm in Benton County since 1928. It was originally owned by Dean and Donna’s grandparents, and later by their parents. After the death of their father in 1967, the land continued to be owned by their mother and was farmed by John Brownlie. John is Donna’s husband.

The land passed to Dean and Donna in 1995 following the death of their mother. Dean inherited the southern 100 acres while Donna inherited the northern 100 acres.

The 200-acre tract was bordered on the east by the Benton-Linn Road. A public road also bordered the property to the south. Farm land owned by third parties bordered the property to the west and the north. A creek, known as Dry Creek, runs diagonally across the tract from the northeast corner of the land to the western half of the southern border. Most of the northern tract inherited by Donna lies west of Dry Creek.

Contrary to its name, water runs through Dry Creek at various levels depending upon the time of the year and the amount of rainfall. The creek is generally seven to nine feet wide with water at a minimum level of three inches in the fall of the year. The water level is around eighteen inches in springtime. For the most part, the creek has steep banks. After a heavy rain, the creek can rise to levels in excess of five feet and spill over the banks. The creek normally rises over its banks several times each year.

Over the years, the Owens family gained access with their farm equipment to the land west of Dry Creek by three methods. One method was to enter from the public road running along the southern border. Another means was to cross over the neighbor’s land to the north. The third' method was to cross through a shallow area of the creek in the northern portion of the land where the banks of the creek slope.

Over time, the access point through the creek was discontinued. It was last used in 1967. A grove of trees subsequently grew in the area and the creek has started to produce steeper banks. Additionally, the crossing over the neighbor’s land to the north was lost years ago. This , land had been owned by Dean and Donna’s uncle, who permitted the crossing. The land is now owned by a third person.

After the land was divided into north and south tracts, the Brownlies believe they did not have ingress or egress to their land west of Dry Creek. They instituted a condemnation proceeding seeking to acquire a public way over Owens’ land for the purpose of ingress arid egress.' They alleged in their condemnation application that their property was land locked, and sought to condemn a 100-yard path along the western border of Owens’ land to the public road running along the southern border of the land.

The Brownlies presented their application for condemnation to the chief judge of the sixth judicial district. This is the judicial district in' which the property is located. The judge appointed a condemnation commission to assess the value of the strip of land sought to be condemned. Owens was notified of the time and date in which the commission would view his land to' assess the damages.

The land was appraised by the commission at $2740. Owens subsequently filed a petition seeking a declaratory judgment that the Brownlies were not authorized to condemn the land. Owens also sought permanent and temporary injunctive relief. He claimed the Brownlies had reasonable access to the land west of Dry Creek by simply crossing through the creek. Prior to trial, Owens amended his petition to include allegations of fraud and illegality based upon deficiencies in the application for condemnation. He also claimed he was denied due process because of the lack of notice prior to the appointment of the condemnation commission.

Owens acknowledged at trial that the area of the creek formerly used as a crossing could not presently accommodate farm equipment. However, he believed the old creek crossing could be restored by removing the trees, grading the banks, and installing a rock or gravel bed. Owens indicated his father was able to transport all of his farm equipment over the area when it was used as a crossing prior to 1967. Owens also believed the Brownlies could install a large culvert or construct a bridge over the creek, but offered no evidence of the cost of such a project.

John Brownlie farmed the 200-acre tract for nearly thirty years prior to the time it was divided into north and south sections. He testified at trial that the creek has changed since the Owens family used it as a crossing. It now handles a greater volume of water due to increased tiling which runs into the creek from farms upstream. The creek bottom contains deep silt and loose sand, and the ground around the banks is frequently wet and swampy.

Brownlie also testified farming practices and machinery have changed dramatically since the Owens family used the creek as a crossing. The machinery is much bigger and heavier. Brownlie believed his planter in particular would be damaged by driving it through the creek, and grain trucks would be unable to traverse any crossing.

Brownlie further opined that the force of the water at certain times of the year would wash out a rock bed, and the depth of the water level at various times of the year would require an elaborate bridge or culvert system. He believed the cost of a bridge or culvert crossing would be more than the value of the land.

The district court denied the request for injunctive relief and found the Brownlies did not have reasonable access to their land west of Dry Creek and were entitled to condemn Owens’ land to gain a public way. Owens appeals.

II. Scope of Review.

We review declaratory judgment actions according to the manner the case was tried in the district court. Smith v. Bertram, 603 N.W.2d 568, 570 (Iowa 1999). If tried in equity, as in this case, our review is de novo. Iowa R.App. P. 4; Western States Ins. Co. v. Continental Ins. Co., 602 N.W.2d 360, 362 (Iowa 1999). Our review of actions for injunctive relief is also de novo. See In re Luloff, 569 N.W.2d 118, 122 (Iowa 1997). Thus, we give weight to the findings of fact made by the trial court in this case, especially with respect to the credibility of witnesses, but are not bound by those findings. See id.

III. Eminent Domain.

Eminent domain is the power of a government to take private property for public use conditioned upon the payment of just compensation. Hinrichs v. Iowa State Highway Comm’n, 260 Iowa 1115, 1126, 152 N.W.2d 248, 255 (1967). It is recognized to be an inherent aspect of government, exercised through entities or individuals authorized by statute. Hardy v. Grant Township Trustees, 357 N.W.2d 623, 625 (Iowa 1984); see also Reter v. Davenport Ry., 243 Iowa 1112, 1118, 54 N.W.2d 863, 867 (1952). Common recipients of the power of eminent domain include counties, cities, public service entities, as well as the state. See Iowa Code §§ 6A.1, .4, .6. The power to condemn land in Iowa is also conferred upon those who own or lease land which has no public or private access. Id. § 6A.4(2). Thus, an owner of “land locked” property is permitted to institute condemnation proceedings to secure a public way over other land to permanently solve the inability to access the property. In re Luloff, 512 N.W.2d 267, 274 (Iowa 1994) (hereinafter “Luloff I”).

An eminent domain action is recog nized as a special proceeding. Richardson v. City of Centerville, 137 Iowa 253, 256, 114 N.W. 1071, 1072 (1908). It is a unique blend of administrative and legal procedures which are prescribed by statute. See Iowa Code ch. 6B; see also State v. Johann, 207 N.W.2d 21, 23 (Iowa 1973). Unlike a traditional adversary proceeding, an eminent domain action is initiated by the condemner without notice to the con-demnee by claiming to be an entity authorized by the legislature to condemn land. The only judicial action which occurs before the condemnation commission is assembled to assess the compensation for the taking is a determination by the chief judge of the judicial district in which the land is located that the application is legally sufficient and the applicant is empowered to condemn the land. Johann, 207 N.W.2d at 24. Following this threshold determination, a condemnation commission is selected to appraise the damages as a result of the taking. See Iowa Code § 6B.4. The condemnee is then given notice of the time the commission will view the land to assess the damages. Id. § 6B.8; see Thornberry v. State Bd. of Regents, 186 N.W.2d 154, 156 (Iowa 1971).

Once the award is made by the condemnation commission, either the condemner or condemnee may appeal the assessment to the district court. Iowa Code § 6B.18; Burnham v. City of West Des Moines, 568 N.W.2d 808, 810 (Iowa 1997). The general focus of the appeal, however, concerns the amount of damages. See State ex rel. Iowa State Highway Comm’n v. Read, 228 N.W.2d 199, 203 (Iowa 1975). Additionally, a condemnee may challenge the initiating action of the condemner by injunction, mandamus, and certiorari. Thompson v. City of Osage, 421 N.W.2d 529, 581 (Iowa 1988). These remedies give the condemnee a procedural vehicle to promptly challenge the propriety of the condemnation, including the issue whether the property sought to be condemned is necessary for public use. Id. at 532.. Although our legislature primarily decides those activities that constitute public use, courts decide whether the underlying facts show an activity that constitutes a public use. 27 Am.Jur.2d Eminent Domain § 555, at 112-13 (1996). Thus, our legislature has declared the taking of land for access to land locked property .to be a public use under section 6A.4(2). -Yet,.the right of an- owner of land locked property to proceed under the statute depends upon “the existence of facts upon which the right rests.” Strawberry Point Dist. Fair Soc’y v. Ball, 189 Iowa 605, 609, 177 N.W. 697, 698 (1920). An owner who seeks to exercise the right of condemnation nrnst in-fact have no public or private way from the land to a street or highway. Luloff I, 512 N.W.2d at 271.

IY. Challenge to Authority to Condemn as Owner of Land Locked Property.

Owens initially claims the Brownlies had no underlying right to condemn his land because their property was not land locked. His claim is based on two arguments. First, he asserts land cannot be land locked under section 6A.4(2) as long as a portion of the overall tract of the land is accessible from a public road. Second, he argues the Brownlies have reasonable access to their land west of Dry Creek.

A. Burden of Proof. .

Before addressing the factual basis for condemnation, we must consider the procedural posture- in which the challenge is made. Owens requested declaratory and injunctive relief in response to the condemnation of his land. The burden of proof in a declaratory judgment action is the same as in an ordinary action at law or equity. North Liberty Land Co. v. Incorporated City of North Liberty, 311 N.W.2d 101, 103 (Iowa 1981). The plaintiff bringing the action has the burden of proof, even if a negative declaration is sought. Id.; see Myers v. Caple, 258 N.W.2d 301, 305 (Iowa 1977) (party seeking injunction has burden of proof). Moreover, we have previously determined that the burden of proof in an action to challenge the authority of the condemning entity to condemn land rests with the landowner whose land is sought to be condemned. Hardy, 357 N.W.2d at 627; Mann v. City of Marshalltown, 265 N.W.2d 307, 314 (Iowa 1978). Thus, we conclude Owens had the burden of proof by a preponderance of the evidence to show the Brownlies were, not authorized under the statute to condemn land as a public way because their property was not land locked..

B. Land Locked Property.

The language of section 6A.4(2) authorizes condemnation when a landowner has “no public or private way to the lands.” Iowa Code § 6A.4(2). The statute does not expressly define whether condemnation is authorized when only a portion of the land is claimed to be without “public or private way.” However, we recognize the goal of the statute authorizing condemnation by an owner of land locked property is to solve the problem of access to the property. Luloff I, 512 N.W.2d at 274. It is socially desirable to make land locked property useable by providing a means of ingress and egress. Id. at 273 (providing a public way to land locked property is for the general good of the public). This purpose is implicated when part of a tract of land is inaccessible just as when all of the land is inaccessible.

A natural obstruction can be so obtrusive that it essentially creates two separate tracts of land. See Anderson v. Lee, 191 Iowa 248, 251, 182 N.W. 380, 381 (1921) (stream and large ditch subject to overflow, coupled with stony hills claimed impassable); see also McGowin Inv. Co. v. Johnstone, 54 Ala.App. 194, 306 So.2d 286, 288 (Civ.App.1974) (physical make-up of land — swamps, ravines, and creeks — coupled with the prohibitive cost of improving denied reasonable access to land); Miller v. Schmitz, 80 Ill.App.3d 911, 36 Ill.Dec. 68, 400 N.E.2d 488, 490-91 (1980) (easement by implication granted across neighbor’s land where bridging the creek which bisected the land constituted substantial expenditure in light of inexpensive easement across defendant’s land); Wiese v. Thien, 279 Mo. 524, 214 S.W. 853, 855 (1919) (impassability of river which divided land resulted in two separate parcels of land); Beeson v. Phillips, 41 Wash.App. 183, 702 P.2d 1244, 1247 (1985) (access to one portion of condemner’s property does not preclude obtaining vehicular access to other parts of property not reasonably available without encroaching upon neighbors’ property); see Michael A. DiSabatino, Way of Necessity Where Only Part of Land is Inaccessible, 10 A.L.R.4& 500 (1981). We believe the language and purpose of our condemnation statute reveal a landowner is authorized to condemn land when any portion of the entire tract of land has no public or private way. We reject Owens’ claim that the Brownlies’ land west of Dry Creek cannot be considered land locked because there is public access to their land east of Dry Creek.

C. Reasonable Necessity.

A landowner is only authorized to condemn an access way to a public road or private land under section 6A.4(2) if there is no existing private or public access to the land. Luloff I, 512 N.W.2d at 271. The parties agree there is no public access in this case to the land west of Dry Creek. The dispute is whether the Brownlies have private access through their own land. The Brownlies claim the creek prevents reasonable private access to the land west of the creek. Owens claims that the Brownlies can acquire access through the creek by making some minor modifications to the area.

We have never squarely addressed the issue of when a natural obstruction over private land makes a portion of the land inaccessible for the purposes of condemnation. Other jurisdictions offer a host of views. See Ex parte Cater, — So.2d -, -, 2000 WL 264227 (Ala.2000) (condemnation not allowed where no evidence showing disproportionate nature of building bridge or repairing previous private roadway); Riggs v. Bert, 245 Ark. 515, 432 S.W.2d 852, 853 (1968) (building bridge or bulldozing and filling the intervening creek were options precluding condemnation of neighbor’s land); Thompson v. Whinnery, 895 P.2d 537, 541-42 (Colo.1995) (easement by necessity declined where land was accessible by foot or horseback); McCluggage v. Loomis, 176 Kan. 318, 270 P.2d 248, 253 (1954) (“statute makes no provision for laying out a road over the land of another ... [where land] is separated ... by a stream, gulch, deep ravine or any other natural depression or obstruction.... ”); Hollars v. Church of God, 596 S.W.2d 73, 75 (Mo.Ct.App.1980) (“hollow” which bisected land did not create two separate parcels, land was one tract with access to public highway thus precluding condemnation); State ex rel. Carlson v. Superior Court, 107 Wash. 228, 181 P. 689, 691 (1919) (“A man having a present right of way may find a more convenient way over the land of another, but he may not take it under a claim that it is necessary to the proper use and enjoyment of his land or to save expense, unless there is no other passable way or expense would be prohibitive.”).

Owens argues a landowner should have no right to condemn under section 6B.4(2) if the owner is able to get to property however inconvenient or costly the access may be. This absolute necessity standard has been followed in some jurisdictions. See 26 Am.Jur.2d Eminent Domain § 75, at 512-13 (1996). Other jurisdictions, however, follow a less stringent standard of reasonable necessity, and permit condemnation if providing private access between two tracts would be extremely inconvenient or impractical, or cost-prohibitive. Id.

We have previously recognized that an existing right of access to defeat the right of condemnation for an access route must be reasonably adequate for the intended purpose. Luloff I, 512 N.W.2d at 271; Anderson, 191 Iowa at 251, 182 N.W. at 382. Thus, we reject the absolute necessity standard urged by Owens. However, we also recognize that the ability to change the condition of land to provide for access is .considered. See Anderson, 191 Iowa at 251, 182 N.W. at 382. Thus, while we follow a reasonableness standard, there are actually two areas of inquiry. As stated by the Supreme Court of Alabama:

“If one has a way through his'own land, he cannot impose a ‘way of necessity’ through his neighbor’s land, unless his own way is not reasonably adequate or its cost is prohibitive. Mere inconvenience or mere cost, as the basis for using another’s land to get access to one’s own property, falls short of meeting this test.”

Cater, — So.2d at -, 2000 WL 264227 (citations omitted) (quoting Oyler v. Gilliland, 382 So.2d 517, 519 (Ala.1980)).

The first inquiry is whether the land in its existing state provides reasonable access. Mere inconvenience does not establish lack of reasonable access. Instead, this standard considers the nature of the obstruction and all other surrounding circumstances, including the intended use of the land and the intended purpose for access. See Luloff I, 512 N.W.2d at 271; Anderson, 191 Iowa at 251, 182 N.W. at 382 (width of path inadequate to accommodate farm machinery). It may also be appropriate in some cases to consider the value of the land sought to be condemned against the value of the land benefited by the condemnation. See MacCaskill v. Ebbert, 112 Idaho 1115, 739 P.2d 414, 419 (App.1987); Jackson v. Nash, 109 Nev. 1202, 866 P.2d 262, 269 (1993).

If Reasonable access does not exist, the next inquiry is whether the land can be changed by the owner to provide reasonable access. See Anderson, 191 Iowa at 251, 182 N.W. at 382 (reasonable improvements impractical in light of natural character of land). Many jurisdiction's who follow the reasonable necessity standard consider the cost of the improvements and apply a test of proportionality to answer this inquiry. See Michael A. DiSabatino, Way of Necessity Over Another’s Land, Where a Means of Access Does Exist, But is Claimed to be Inadequate, Inconvenient, Difficult, or Costly, 10 A.L.R.4th 477 (1981).

Under the test of proportionality, a natural obstruction makes land privately inaccessible where the cost of making the land reasonably accessible is disproportionate to the value of the land. See LeSatz v. Deshotels, 757 P.2d 1090, 1093 (Colo.App.1988) (no evidence that cost of construction of bridge was grossly in excess of value of land); Eisenbarth v. Delp, 70 Idaho 266, 215 P.2d 812, 814 (1950); Miller, 36 Ill.Dec. 68, 400 N.E.2d at 491 ($25,000 cost to build bridge across forty-foot-wide creek that is four feet deep, when compared to a $500-900 annual agricultural income from the land is disproportionate where can inexpensively access neighbor’s land for ingress/egress); Badura v. Lyons, 147 Neb. 442, 23 N.W.2d 678, 684 (1946) (cost of improvement compared to value of land); Daniel v. Fox, 917 S.W.2d 106, 111 (Tex.Ct.App.1996); but see McCluggage, 270 P.2d at 253 ($3500-4500 cost to build bridge across twenty-to-thirty foot wide and one-and-a-half foot deep creek not so prohibitive ■ as to permit access across neighbor’s land). In many cases, this test will consider the cost of constructing a way across the natural obstruction with the value of the land benefited by the way. Miller, 36 Ill.Dec. 68, 400 N.E.2d at 491. In other cases it may be appropriate, to also consider the value of the land sought to be condemned. Thus, the test does not employ strict guidelines, but like the first inquiry relies on the standard of reasonableness, and requires all the facts to be considered.

In considering the first inquiry in this case, Owens acknowledged there was no present access for farm machinery through the creek. Thus, the fighting issue is whether reasonable access can be gained by constructing a crossing through or over the creek at a reasonable cost under the test of proportionality.

Upon our review of all the evidence, we find Owens failed to prove the Brownlies’ property is not land locked. The evidence offered by Owens to support the claim that reasonable access can be gained by making modifications to the creek was speculative. There was no evidence of the cost of constructing a bridge or culvert. The record also failed to reveal the value of the land west of the creek to compare to the cost of construction. Additionally, the Brownlies offered evidence to create sufficient doubt over the feasibility of the improvements proposed by Owens. Owens failed to meet his burden of proof.

V. Challenge to the Application For Condemnation.

Owens claims the entire proceedings were rendered null and void because the condemnation application failed to set forth sufficient information to support an initial judicial determination that the property was land locked. He also claims the petition failed to disclose other relevant information that would have caused the application to be denied by the chief judge.

An applicant for condemnation must comply with the condemnation statute. Aplin v. Clinton County, 256 Iowa 1059, 1061, 129 N.W.2d 726, 727 (1964). However, the information Owens claims should have been presented in the application is not required to be contained by the statute. See Iowa Code § 6B.3. The eon-demner under section 6A.4(2) is not required to explain the theory to support the claim of “no public or private way” to the land, but only “the purpose for which the condemnation is sought.” See id. § 6B.3(4). The Brownlies alleged in the application their property was “land locked” and they needed “ingress and egress.” We believe this constituted sufficient compliance.

We recognize the chief judge is required to make a quasi judicial determination of the legal sufficiency of the application and further determine the applicant is empowered to exercise condemnation. See Johann, 207 N.W.2d at 24. However, this determination is made from the information required to be placed in the application under section 6B.3. Id. (interpreting Iowa Code section 472.3, the precursor to Iowa Code section 6B.3). The statute does not contemplate that the applicant who claims to be land locked be required to litigate the issue before exercising the power of condemnation. Carter v. Barkley, 137 Iowa 510, 514-15, 115 N.W. 21, 22-23 (1908).

We conclude the application contained sufficient information for the chief judge to determine the Brownlies were authorized to condemn the land. In permitting the owners of land locked property to condemn land to establish a public way, our legislature has concluded that there is a public benefit for condemning land for access to land locked property. Luloff I, 512 N.W.2d at 273. Our legislature has also concluded a private landowner could utilize the statute just as a public entity is authorized to exercise the power of condemnation. The court accepts the legislatively granted authority, and a condemnee who" believes no factual basis exists for the authority is afforded an opportunity to assert a subsequent challenge.

VI. Procedural Due Process Challenge.

Owens ■ claims the statutory condemnation scheme is procedurally defective because it fails to provide the con-demnee with notice and opportunity to be heard before the application is judicially approved.

Due process must be afforded where state action threatens to deprive an individual of a protected liberty or property interest. Callender v. Skiles, 591 N.W.2d 182, 189 (Iowa 1999). If a protected interest is involved, we evaluate what process is due. Id. There are two fundamental requirements involved, notice and the opportunity to be heard. In re Estate of Adams, 599 N.W.2d 707, 710 (Iowa 1999). The requirements, however, are flexible and the type of hearing required depends upon:

“(a) the private interests implicated; (b) the risk of an erroneous determination by reason of the process accorded and the probable value of added procedural safeguards; and (c) the public interest and administrative burdens, including costs that the additional procedure would involve.”

Skiles, 591 N.W.2d at 189-90 (quoting In re Marriage of Settler, 559 N.W.2d 7, 9 (Iowa 1997)).

Owens argues he was denied due process when he was not given an opportunity to argue his opposition to the condemnation prior to the decision- by the chief judge to permit condemnation to proceed. However, a pre-determination hearing is not required to satisfy due process. Rather, the hearing must “be granted at a meaningful time and in a meaningful manner.” Fuentes v. Shevin, 407 U.S. 67, 80, 92 S.Ct. 1983, 1994, 32 L.Ed.2d 556, 570 (1972) (quoting Armstrong v. Manzo, 380 U.S. 545, 552, 85 S.Ct. 1187, 1191, 14 L.Ed.2d 62, 66 (1965)). The key is “whatever its form, opportunity for [the] hearing must be provided before the deprivation at issue takes effect.” Id. at 82, 92 S.Ct. at 1995, 32 L.Ed.2d at 571.

Owens was afforded ample notice and opportunity to submit his opposition to the proposed condemnation. For example, he was notified of the appointment of a Condemnation Commission and the date of the assessment of his property two days after the chief judge granted Brownlie’s application, and over three weeks prior to the assessment. Shortly after the assessment, Owens filed a "petition in equity seeking declaratory judgment and an injunction. The Brownlies filed a motion to dismiss in response to this petition, upon which the court heard oral arguments. Owens was able to present evidence to the court and cross-examine Brownlies’ witnesses at this hearing. The court ruled in favor of Owens on the Brownlies’ motion to dismiss. There was an additional hearing on Owens’ request for a temporary injunction. Finally, there was a trial to the court on Owens’ petition in equity.

When a hearing is afforded, “due process demands contestants be given notice thereof sufficient to permit a reasonable opportunity to appear and assert their rights.” Hyde v. Anania, 578 N.W.2d 647, 650 (Iowa 1998) (quoting Smith v. Iowa Employment See. Comm’n, 212 N.W.2d 471, 472 (Iowa 1973)). Owens cannot argue he was not given sufficient notice of the action against his property, for he took substantial steps to alert the court of his objection and resistance to the condemnation. Additionally, Owens was given three separate hearings before the court to present his evidence. Owens cannot now argue his rights were procedurally infringed upon, for he was afforded all the due process to which he was entitled.

VII. Conclusion.

On our de novo review, we find Owens failed to establish the Brownlies had a public or private way to their land west of Dry Creek. We conclude the procedure for condemnation does not violate the Due Process Clause under the state or federal constitutions in light of the opportunity provided for a hearing to challenge the right to condemn land.

AFFIRMED.

All justices concur except LAVORATO, J., who takes no part.

      . The recent amendments to chapter 6B, not applicable to this case, now provide for notice and good faith negotiations for the purchase of the land before filing an application for condemnation. See 1999 Iowa Acts ch. 171, §§ 3, 4.

      .Iowa Code section 6B.3 sets forth the requirements for an application for condemnation. They include:
      1. A description of all the property in the county, affected or sought to be condemned, by its congressional numbers, in tracts not exceeding one-sixteenth of a section, or, if the land consists of lots, by the numbers of the lot and block, and plat designation.
      2. A plat showing the location of the right-of-way or other property sought to be condemned with reference to such description.
      3. The names of all record owners of the different tracts of land sought to be condemned, or otherwise affected by the proceedings, and of all record holders of liens and encumbrances on such lands; also the place of residence of all such persons so far as known by the applicant.
      4. The purpose for which condemnation is sought.
      5. A request for an appointment of a commission to appraise the damages.
      Iowa Code § 6B.3(l)-(5).

      .The Code editor transferred Iowa Code section 472.3 to section 6B.3 in 1993.

      . In Fuentes, the Supreme Court ruled unconstitutional two prejudgment replevin statutes that did not provide for a pre-deprivation hearing. Fuentes, 407 U.S. at 96, 92 S.Ct. at 2002, 32 L.Ed.2d at 579. However, it noted that such pre-deprivation hearings were not necessary where an important governmental or public interest is served by the quick adjudication of rights. Id: at 90-92, 92 S.Ct. at 1999-2000, 32 L.Ed.2d at 575-77. In the case of land locked property, our legislature has declared immediate access to one’s property an immediate public interest, thus permitting the determination for condemnation to be made upon the initial application, postponing the condemnee’s opportunity to be heard until after such determination. Id. at 90, 92 S.Ct. at 1999, 32 L.Ed.2d at 575.

      . The process established by the legislature for the condemnation of another's land by a private party, in effect, places the burden of protecting one's land on the landowner-con-demnee by granting the condemner the power of eminent domain. See Iowa Code § 6A.4(2). While the argument that shifting this burden to the condemnee infringes upon his constitutional rights by denying him due process was not raised, we note this is not a consideration in the procedural due process analysis. The key to the procedural due process analysis is to ensure any deprivation of private property is fair. 16B Am.Jur.2d Constitutional Law § 901, at 485 (1998). In doing so, the court focuses upon the procedure afforded, namely notice and an opportunity to be heard, which were both fulfilled here. Id. § 902, at 488; see also Logan v. Zimmerman Brush Co., 455 U.S. 422, 428, 102 S.Ct. 1148, 1153-54, 71 L.Ed.2d 265, 273 (1982); Board of Regents v. Roth, 408 U.S. 564, 569, 92 S.Ct. 2701, 2705, 33 L.Ed.2d 548, 556 (1972).


author: Kathleen A. Blatz Chief Justice

text:
    Gerald D. SIMONSON, Respondent, v. ZUPANICH BROTHERS and EBI Companies, Relators, and Zupanich Brothers and Sentry Insurance Company, Zupanich Brothers and American Family Insurance Company, Respondents, and Northern Minnesota-Wisconsin Retail Food Health & Welfare Fund, intervenor, Respondent, and Special Compensation Fund.
    No. C7-00-324.
    Supreme Court of Minnesota.
    May 16, 2000.
    Russell J. LaCourse, Duluth, for employee-respondents.
    Todd Jerome Thun, Bassford, Lockhart, Truesdall & Briggs, P.A., Minneapolis, for relators.
   ORDER

Based upon all the files, records and proceedings herein,

IT IS HEREBY ORDERED that the decision of the Workers’ Compensation Court of Appeals filed January 27, 2000, be, and the same is, affirmed without opinion. See Minn. R. Civ.App. P. 136.01, subd. 1(b).

BY THE COURT:

Kathleen A. Blatz Chief Justice


author: Alan C. Page Associate Justice

text:
    In re Petition for DISCIPLINARY ACTION AGAINST Peter Bruce ZATZ, an Attorney at Law of the State of Minnesota.
    No. C9-98-209.
    Supreme Court of Minnesota.
    May 22, 2000.
   ORDER

The Director of the Office of Lawyers Professional Responsibility has filed a petition for disciplinary action alleging that respondent Peter Bruce Zatz has committed professional misconduct warranting public discipline, namely, neglecting a client matter and misrepresenting the status of the matter to the client, failing to hold client funds in a trust account, failing to promptly return funds to a client, failing to return a client’s file in a timely manner, neglecting a conservatorship proceeding and failing to disclose the conservator’s conversion of estate assets, and omitting the conservatorship matter from his probation reports, in violation of Rules 1.1, 1.2(c), 1.3, 1.4, 1.15(a) and (c), 1.16(a) and (d), 3.2, 3.3(a)(2), 3.4(c), 4.1, 8.1(a)(1), 8.4(c) and 8.4(d), Minnesota Rules of Professional Conduct, and Lawyers Professional Responsibility Board Opinion 15.

Respondent admits his conduct has violated the Rules of Professional Conduct, waives his rights pursuant to Rule 14, Rules on Lawyers Professional Responsibility (RLPR), and has entered into a stipulation with the Director wherein they jointly recommend that the appropriate discipline is a three-month suspension and payment of $900 in costs pursuant to Rule 24, RLPR. Respondent further acknowledges that this court may impose any discipline it deems appropriate.

This court has independently reviewed the file and accepts respondent’s admission of misconduct. However, we conclude that respondent’s disciplinary history and the fact that the misconduct admitted here occurred while on probation requires that respondent be suspended indefinitely. See In re Anderson, 569 N.W.2d 923 (Minn. 1997). Therefore, we find that the appropriate discipline is indefinite suspension with no right to apply for reinstatement for three months.

IT IS HEREBY ORDERED that respondent is suspended indefinitely for a minimum of three months, and that he pay $900 in costs pursuant to Rule 24, RLPR. Respondent shall comply with the reinstatement hearing provisions of Rule 18, RLPR, should he apply for reinstatement.

BY THE COURT:

Alan C. Page Associate Justice


author: GILBERT, Justice.

text:
    Carol BECKER, et al., petitioners, Appellants, v. STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, Respondent.
    No. C6-99-288.
    Supreme Court of Minnesota.
    May 25, 2000.

      John P. Dehen, New Brighton, for appellants.
    Ken D. Schueler, Dunlap and Seegér, P.A., Rochester, Kay Nord Hunt, Lorn-men, Nelson, Cole & Stageberg, Minneapolis, for respondent.
    Paul D. Peterson, Woodbury, for amicus curiae Minnesota Trial Lawyers Association.
    Paul Á. Banker, Arthur, Chapman, Kettering, Smetak & Pikala, Minneapolis, for amicus curiae Robert J. Hauer, Jr. and Theodore J. Smetak.
   OPINION

GILBERT, Justice.

This case addresses the question of whether an employee injured while occupying her employer’s insured .vehicle can seek excess uninsured/underinsured motorist (UM/UIM) coverage from her personal automobile insurance policy under Minn.Stat. § 65B.49, subd. 3a(5) (1998). Carol Becker, a truck driver, was injured in a motor vehicle accident during the course and scope of her employment while driving a semi-truck owned by her employer. Becker obtained UM/UIM benefits from her employer’s coverage, but her covered damages exceeded the policy limits of liability available from the occupied vehicle. She thus sought excess coverage from her personal automobile insurance policy in which she was otherwise insured. The court of-appeals concluded that pursuant to Minn.Stat. § 65B.49, subd. 3a(5), Becker was an insured under her employer’s policy on the occupied motor vehicle and thus was not entitled to seek excess UM/UIM protection afforded by her policy in which she was otherwise insured. We reverse and remand to the court of appeals for further proceedings.

The facts of this case, other than the amount of damages, are undisputed. On July 2, 1992, appellant Carol Becker was injured in a car-truck accident near Everly, Iowa, when the truck she was driving was struck by a car that crossed over the centerline. At the time of the accident, Becker was employed by Barry Wold Trucking Company and was driving in the course and scope of her employment a 1992 Peterbilt semi-truck owned by Wold Trucking. Wold Trucking had workers’ compensation insurance with Employers Mutual Insurance Company, which paid Becker at least $52,810.06 in benefits after the accident.

Becker and her husband, David Becker, brought a claim against the driver of the other car. The other driver had very few assets and was insured by Midwest Mutual Insurance Company with a bodily injury liability limit of only $20,000. On May 25, 1995, the Beckers agreed to a settlement with Midwest for $20,000 in return for a release of “any/all claims” against the other driver or Midwest. Midwest paid this money directly to Employers Mutual, the workers’ compensation insurer, which then waived its subrogation rights against the other driver.

The Beckers claim the damages that they sustained exceeded their recovery from the other driver. Because the other driver was considered an uninsured/under-insured motorist under Minnesota law, the Beckers sought UM/UIM coverage. Pursuant to Minn.Stat. § 65B.49, subd. 3a(5), the Beckers first sought UM/UIM coverage from the insurer of the truck Becker was driving, Harco Insurance Company. Harco paid the Beckers $50,000 UM/UIM benefits, the extent of its liability under the policy with Wold Trucking. However, the Beckers claim they have sustained damages in excess of this amount.

In January 1997, the Beckers notified their personal automobile insurer, State Farm Mutual Automobile Insurance Company, that they were filing a claim for excess UM/UIM coverage under their policy, which had limits of $100,000 per person, up to a total of $300,000 per accident. This notification was the first State Farm knew of Becker’s 1992 accident. State Farm initially denied coverage on the grounds that the Beckers did not provide State Farm with notice of their intent to settle with Watson as required by our decision in Schmidt v. Clothier, 338 N.W.2d 256, 263 (Minn.1983).

The Beckers initiated this lawsuit in May 1997. State Farm moved for summary judgment because the Beckers’ failed to provide State Farm with a Schmidt-Clothier notice of their settlement with Watson. The district court denied the motion, deciding that State Farm was not prejudiced by the lack of Schmidh-Clothier notice because Watson “would have been a very poor subrogation prospect.”

In 1998, State Farm again moved for summary judgment, this time claiming that the Beckers were not entitled to seek excess UM/UIM benefits under Minn.Stat. § 65B.49, subd. 3a(5), because Becker was an insured under her employer’s insurance policy on the occupied vehicle and thus she could only receive UM/UIM benefits from that insurance policy. The Beckers responded that under the definition of insured in the No-Fault Act found at Minn. Stat.- § 65B.43, subd. 5 (1998), Becker was not a named insured, or the spouse, resident relative, or a minor in the custody of a named insured, under the Harco policy so she was entitled to seek excess coverage. The district court granted summary judgment to State Farm, deciding the issue on the basis of an unpublished court of appeals opinion, Crane v. ABF Freight Systems, Inc., No. C2-95-1039, 1995 WL 635131 (Minn.App. Oct.31, 1995), review denied (Minn. Dec. 20,1995).

The Beckers appealed and the court of appeals affirmed. See Becker v. State Farm Mut. Auto. Ins. Co., 596 N.W.2d 697, 701 (Minn.App.1999). The court of appeals concluded that it was error for the district court to rely exclusively on the unpublished Crane decision, but the court held the error was harmless because the language of the Minnesota No-Fault Act and published case law supported the decision. See Becker, 596 N.W.2d at 700. The court of appeals based its decision on two of its prior cases. The first case cited was LaFave v. State Farm Automobile Insur ance Co., 510 N.W.2d 16 (Minn.App.1993). See Becker, 596 N.W.2d at 700. In La-Fave, Sharen LaFave was injured when the pick-up truck she was riding in, which was owned and operated by her husband, was struck by an uninsured motorist. See id. at 17. Sharen LaFave sought excess UM/UIM coverage from another insurance policy on an automobile owned by her. See id. at 17-18. The court of appeals concluded that she was an insured under the policy on the occupied vehicle and therefore she was not entitled to excess coverage under her own policy. See id. at 18-19.

The second decision relied upon by the court of appeals was Murphy v. Milbank Mutual Insurance Co., 438 N.W.2d 390 (Minn.App.1989), rev. denied (Minn. June 9, 1989), which held that the statutory definition of insured in section 65B.43, subd. 5, also includes employees of the named insured. See Becker, 596 N.W.2d at 700-01. Based on these cases, the court of appeals rejected the “narrow definition” of insured advocated by the Beckers and concluded that because Becker was “covered” under a plan of reparation security, she was an insured under her employer’s policy. See id. at 701. Thus, the.court of appeals held she could not seek excess UM/UIM coverage from her own insurance policy with State Farm under Minn. Stat. 65B.49, subd. 3a(5). See Becker, 596 N.W.2d at 701. In light of this holding, the court of appeals did not reach the Schmidl-Clothier notice and collateral source offset issues decided by the district court.

The Beckers petitioned this court for review. State Farm requested cross-review of the SchmAM-Clothier notice and collateral source offset issues. We granted the Beckers’ petition for review, but denied State Farm’s request for cross-review..

On appeal from summary judgment we must determine whether there are any genuine issues of material fact and whether the moving party is entitled to judgment as a matter of law. See Lobeck v. State Farm Mut. Auto. Ins. Co., 582 N.W.2d 246, 249 (Minn.1998). The only issue before us involves the interpretation of Minn.Stat. § 65B.49, subd. 3a(5). The interpretation of a statute is a question of law that is reviewed by this court de novo. See Hertz Carp. v. State Farm Mut. Ins. Co., 573 N.W.2d 686, 688 (Minn.1998).

The Minnesota No-Fault Automobile Insurance Act requires every motor vehicle owner to maintain, and mandates all plans of reparation security to provide, separate minimum UM/UIM limits of coverage of $25,000 per person, up to a total of $50,000 per occurrence. See Minn.Stat. § 65B.49, subd. 3a(l)-(2) (1998). Under this system, individuals may select and purchase the amount of UM/UIM coverage they desire on their own personal automobile insurance policy up to the bodily injury liability limits of that policy. See Minn.Stat. § 64B.49, subd. 3a(3) (1998).

The crucial question presented is whether under these facts this reparation security is nullified in regard to covered damage claims when an individual is the driver and/or occupant of her employer’s insured motor vehicle. We must look to Minn. Stat. § 65B.49, subd. 3a(5), in answering this question. This statute provides:

If at the time of the accident the injured person is occupying a motor vehicle, the limit of liability for uninsured and underinsured motorist coverages available to the injured person is the limit specified for that motor vehicle. However, if the injured person is occupying a motor vehicle of which the injured person is not an insured, the injured person may be entitled to excess insurance protection afforded by a policy in which the injured party is otherwise insured. The excess insurance protection is limited to the extent of covered damages sustained, and further is available only to the extent by which the limit of liability for like coverage applicable to any one motor vehicle listed on the automobile insurance policy of which the injured person is an insured exceeds the limit of liability of the coverage available to the injured person from the occupied motor vehicle.

Minn.Stat. § 65B.49, subd. 3a(5).

The first sentence of subdivision 3a(5) directs injured occupants to seek UM/UIM coverage initially from the insurer of the motor vehicle they occupied at the time of the accident and establishes as limits of liability those specified in the policy on the occupied vehicle. See id.; Hanson v. American Family Mut. Ins. Co., 417 N.W.2d 94 (Minn.1987). The second sentence of the subdivision provides that if the injured person is not an insured of the occupied motor vehicle, the injured person may then be entitled to seek excess insurance protection through another automobile insurance policy in which the injured person is insured. See Minn.Stat. § 65B.49, subd. 3a(5). The third sentence of this statute then limits the availability of this excess coverage to the “extent of covered damages sustained,” and to the extent that “like coverage” from another automobile insurance policy “exceeds the limit of liability of the coverage available to the injured person from the occupied motor vehicle.” Id.

Because the second sentence of subdivision 3a(5) makes an injured person eligible for excess UM/UIM coverage only if she is “not an insured” with respect to the occupied vehicle, the resolution of this case turns on the proper definition of “insured” as used in subdivision 3a(5). To resolve this controversy over applicable coverage, both parties direct our attention to the definition of insured in section 65B.43, subd. 5. According to that statute, an insured is

an insured under a plan of reparation security as provided by sections 65B.41 to 65B.71, including the named insured and the following persons not identified by name as an insured while (a) residing in the same household with the named insured and (b) not identified by name in any other contract for a plan of reparation security complying with sections 65B.41 to 65B.71 as an insured:
(1) a spouse,
(2) other relative of a named insured or
(3) a minor in the custody of a named insured or of a relative residing in the same household with a named insured.

Minn.Stat. § 65B.43, subd. 5.

The Beckers urge this court to interpret the statutory definition of insured as meaning only the named insured, spouse of the named insured, or relative or minor residing in .the same household with a named insured. In LaFave, one of the decisions relied upon by the court of appeals, the injured occupant was the spouse of the named insured in the policy on the occupied vehicle, thus meeting the statutory definition of an insured. See LaFave, 510 N.W.2d at 17, 19. However, in the instant case, Barry Wold was the named insured on the policy for the vehicle Becker was driving and, as a result, Becker was not the named insured, the spouse of the named insured, or a resident relative or minor of the named insured under that policy. Therefore, if the legislature intended the term “insured” as used in section 65B.49, subd. 3a(5), to mean only those persons expressly mentioned in section 65B.43, subd. 5, Becker is not an insured under the policy on the vehicle she was driving and would be entitled to seek excess insurance from her own personal automobile policy.

In contrast, State Farm argues that an employee-driver is an insured within the statutory definition. First, State Farm points out that under the definition an insured is anyone “insured under a plan of reparation security * * * including the named insured,” spouse of the named insured, and minor or resident relative of the named insured. Minn.Stat. § 65B.43, subd. 5 (emphasis added). State Farm contends that the term “including” in the definition is a word of illustrative application that is followed by a nonexhaustive list of examples of insureds, and thus an employee-driver could also be an insured under the definition. ,State Farm adds that Becker, as the obvious object of her employer’s policy on the truck she was driving, was an insured under a plan of reparation security.

We do not find State Farm’s arguments persuasive. First, a broad construction of the definition of insured in section 65B.43, subd. 5, is difficult to reconcile with the language of section 65B.49, subd. 3a(5).. In essence, State Farm’s position is that because Becker received benefits from her employer’s policy on the truck she was driving, she should be precluded from seeking the excess UM/UIM coverage she paid for in a policy where she was otherwise insured, as provided for by section 65B.49, subd. 3a(5). By this argument, anyone who receives UM/UIM benefits from the policy on the occupied vehicle is an insured and thus is not entitled to seek excess UM/UIM coverage from another policy even though that coverage is provided for in the remaining sentences of section 65B.49, subd. 3a(5).

State Farm’s position would only "provide recourse to a person who had purchased UM/UIM coverage and was injured while occupying an uninsured vehicle. This interpretation does "not make sense in light of the language that is used in the remaining provisions of section 65B.49, subd. 3a(5). The legislature used language such as “excess insurance protection afforded by a policy in which the injured party is otherwise insured,” “like coverage applicable,” and “exceeds the limit of liability of the coverage available * * * from the occupied motor vehicle.” Minn.Stat. § 65B.49, subd. 3a(5) (emphasis added). These terms would be meaningless, and “excess” UM/UIM coverage would be nullified, if only occupants of uninsured vehicles could seek UM/UIM coverage from their personal automobile policies. To the contrary, this language demonstrates that the legislature envisioned that more than one policy could provide UM/UIM coverage under these circumstances. Further, section 65B.49, subd. 3a(5), establishes the priority scheme for the source of any UM/ UIM coverage for persons injured in accidents while occupants of motor vehicles, except for those persons excluded by the definition of insured provided in Minn.Stat. § 65B.43, subd. 5. See Michael K. Steenson, Minnesota No-Fault Automobile Insurance, 217-1 (2d ed. 1989 & Issue 8, 1998). .

Accordingly, we do not interpret the term “insured” as used in section 65B.49, subd. 3a(5), so broadly as to include any person who receives UM/UIM benefits from a policy only by virtue of their occupancy of a vehicle. State Farm argues, however, that it does not seek such a broad holding, only that employee-drivers should be precluded from seeking UM/ UIM coverage from their personal automobile insurance policies. However, Becker only received coverage from the policy on her employer’s vehicle because she was an occupant of that vehicle and was guaranteed such coverage by section 65B.49, subd. 3a(5). Her status as an employee had nothing to do with her entitlement to that primary UM/UIM coverage.

Then the fundamental question becomes under what circumstances does the legislature intend an injured person to recover UM/UIM benefits only from the policy on the occupied vehicle and not also have recourse to her own mandatory automobile policy for excess UM/UIM coverage. See Minn.Stat. § 645.16 (1998) (“The object of all interpretation and construction of laws is to ascertain and effectuate the intention of the legislature.”). State Farm argues that the legislature has expressed an intent that employee-drivers should not have recourse to their excess UM/UIM coverage by its enactment of Minn.Stat. § 548.36 (1998), which allows a court to reduce an award to an injured plaintiff by the amount of workers’ compensation benefits received, among other things. We disagree.

First, section 548.36 does not provide any guidance as to whether an employee-driver should be precluded from seeking excess UM/UIM coverage from her personal automobile policy under section 65B.49, subd. 3a(5), of the No-Fault Act. Rather, this argument by State Farm goes to the issue of collateral sources for offsetting recoveries, an issue that State Farm raised below but that was not addressed by the court of appeals and is not before us. Second, the legislature has indicated its willingness and ability to provide for limitations on recourse to a personal automobile policy in other situations. For example, the legislature has precluded UM/ UIM coverage for motorcycle occupants, as well as the occupants and resident relatives of owned but uninsured vehicles. See Minn.Stat. §§ 65B.43, subd. 5; 65B.49, subd. 3a(7)-(8) (1998). These persons do not have recourse to the UM/UIM coverage on a personal automobile insurance policy due to statutory limitations.

We hold that the correct interpretation of “insured” as used in Minn.Stat. § 65B.49, subd. 3a(5), is limited to those persons specifically listed in Minn.Stat. § 65B.43, subd. 5; that is, the named insured, or spouse, minor, or resident relative of the named insured, in the policy of the occupied vehicle. This interpretation is consistent with those provisions of Minn. Stat. § 65B.49, subd. 3a(l)-(2) (1998), that permit individuals to protect themselves and family members by paying for UM/ UIM coverage to which they can turn in the event they are injured while riding in someone else’s vehicle covered by a policy with lower limits. Our decision also comports with the underlying goal of the UM/ UIM scheme as enacted in 1985. That scheme gives motor vehicle owners the ability to select and purchase the amount of UM/UIM coverage they desire in excess of the mandatory mínimums, and then access that coverage in the event they are injured while occupying a vehicle owned by someone who has purchased only the minimum UM/UIM coverage, subject to the limitations of section 65B.49, subd. 3a.

Accordingly, we reverse the court of appeals and hold that Becker may seek excess UM/UIM coverage afforded her under her automobile policy with State Farm. As provided in the No-Fault Act, her claim is limited to that amount which “exceeds the limit of liability of the coverage- available to the injured person from the occupied motor vehicle.” Minn.Stat. § 65B.49, subd. 3a(5). We remand to the court of appeals for further proceedings.

Reversed and remanded.

      . Becker injured her knee and claims she is unable to return to work as a truck driver or do many other things she used to enjoy. Becker’s husband; who was also her partner driving trucks, seeks lost wages as well as other damages.

      . A 1993 claim investigation report indicated that the other driver was a retiree living in a long-term care facility due to the severity of her injuries and declining health. She had no assets besides her house and a few personal belongings. Her house and most of her personal belongings were sold in 1994, but these funds were consumed by her health care costs. The other driver died on January 30, 1997.

      . The other driver's liability coverage, although in compliance with Iowa law, was below the $30,000 required by Minn.Stat. § 65B.49, subd. 3 (1998). See Murphy v. Milbank Mut. Ins., 320 N.W.2d 423, 425 (Minn. 1982).

      . For the purposes of the anticipated appeal, after granting summary judgment to State Farm, the district court also ruled on State Farm’s claim that it is entitled to a collateral source offset for the workers’ compensation benefits Becker received. The court of appeals did not reach that issue because it held that State Farm was entitled to summary judgment, and that issue is not before us.

      . As support for this proposition, State Farm cites to a court of appeals' decision with similar facts, Murphy v. Milbank, 438 N.W.2d 390, 395 (Minn.App.1989). However, that case was decided under a statutory scheme that existed prior to 1985, before the statutory UM/UIM priority scheme and excess coverage provisions of section 65B.49, subd. 3a(5), were enacted.

      . Professor Michael K. Steenson identified this problem in the statutory language of section 65B.49, subd. 3a(5), in his treatise Minnesota No-Fault Automobile Insurance, 217-1 (2d ed. 1989 & Issue 8, 1998). He stated:
      The priority scheme [of subdivision 3a(5)] establishes the source of coverage for underinsured and uninsured motorist insurance, and it also mandates coverage in those situations. Occupants of vehicles are entitled to recover under the coverage on those vehicles, irrespective of whether they are insureds under the coverage. * * * Therefore, the second sentence of the statute must mean that the person who may seek excess coverage is "insured” other than by reason of occupancy, that is, as a resident relative. Otherwise, excess insurance coverage would never be available under the statute because the person seeking coverage under the policy covering the car in which he is riding would always be an insured by reason of occupancy.

        Id.


author: PER CURIAM

text:
    In re Petition for DISCIPLINARY ACTION AGAINST Lewis M. KOSS, an Attorney at Law of the State of Minnesota.
    No. C2-96-2024.
    Supreme Court of Minnesota.
    June 1, 2000.
    Lewis M. Koss, Law Offices of Robert J. Vars, Encino, CA, for appellant.
    Edward J. Cleary, Kenneth Jorgensen, Mary L. Galvin, Office of Lawyers Professional Responsibility, St. Paul, for respondent.
   OPINION

PER CURIAM

On December 11, 1997, we suspended respondent Lewis M. Koss from the practice of law in Minnesota as a result of his convictions for mail fraud and racketeering in California in 1991. Respondent requested a disciplinary hearing and a referee was appointed. After a full hearing on the merits, the referee concluded the respondent violated Minn. R. Prof. Conduct 8.4(b), (c), (d), relating to engaging in criminal conduct, dishonesty, and conduct prejudicial to the administration of justice, and recommended his disbarment.

Respondent was convicted of three counts of felony mail fraud and one count of felony racketeering in the United States District Court for the Southern District of California on June 25, 1991. The convictions were based on respondent’s participation in a network of attorneys known as the “Alliance” which engaged in the defrauding of insurance companies of millions of dollars in legal fees in a series of schemes involving the manipulation of civil litigation, including the payment of kickbacks to opposing attorneys and to clients to encourage them to continue litigation, splitting of fees, sharing of office expenses among adverse counsel, and delaying the settlement of lawsuits until the insurance companies were unable or unwilling to pay further legal fees. Respondent was sentenced to concurrent sentences of 46 months for each of his four convictions and fined $100,000. On appeal to the Ninth Circuit Court of Appeals, his convictions were affirmed. See United States v. Mason, Nos. 91-50690, et al., 1994 WL 266102, at *35 (9th Cir. June 15, 1994).

The California Supreme Court ordered respondent’s summary disbarment on May 1, 1996, based upon respondent’s felony convictions. In Minnesota, the Director of the Office of Lawyers Professional Responsibility filed a petition for reciprocal discipline pursuant to Rule 12(d), Rules on Lawyers Professional Responsibility (RLPR). In addition, the Director sought disbarment based upon respondent’s criminal activities in violation of Minn. R. Prof. Conduct 8.4(b), (c), and (d), relating to engaging in criminal conduct, dishonesty and conduct prejudicial to the administration of justice. We temporarily suspended respondent from the practice of law on December 11, 1997, but declined to impose reciprocal discipline under Rule 12(d), RLPR, because the California Supreme Court, in accordance with California’s summary disbarment statute, had failed to provide for a hearing or allow the consideration of mitigating circumstances. See In re Koss, 572 N.W.2d 276, 277-78 (Minn. 1997). We ordered that respondent petition the court for a disciplinary hearing by April 12, 1999, a date six months subsequent to his scheduled release from prison, and if he failed to do so, the court would order, his disbarment. See id. at 278. We also .warned respondent that he would have a heavy burden at a future disciplinary hearing because a felony conviction generally warrants disbarment absent significant mitigating factors. See id.

On April 6, 1999, the New York Supreme Court, Appellate Division, ordered that respondent be stricken from the roll of attorneys in that state due to his felony convictions.

Respondent timely petitioned this court for a disciplinary hearing on April 9, 1999. Respondent appeared and testified at the hearing, and in recommending disbarment the referee concluded that respondent’s criminal conduct violated Minn. R. Prof. Conduct 8.4(b), (c) and (d). The referee further noted that respondent did not offer any character evidence in mitigation or any expression of contrition, and that there were no mitigating factors.

Respondent did not order a transcript of the hearing and therefore the referee’s findings of fact and conclusions of law are deemed admitted pursuant to Rule 14(e), RLPR. We only consider the appropriate discipline. We give the referee’s recommendation great weight but have the final responsibility for determining a disciplinary sanction. See In re Shoemaker, 518 N.W.2d 552, 554-55 (Minn.1994). In determining an appropriate sanction, we consider the nature of the misconduct, the cumulative weight of the disciplinary violations, the harm to the public and the harm to the legal profession. See In re Sigler, 512 N.W.2d 899, 901 (Minn.1994). We impose sanctions on a case-by-case basis, considering both' aggravating and mitigating circumstances, but look to similar cases for guidance. See id; In re Iliff, 487 N.W.2d 234, 236 (Minn.1992). We also weigh the relevant considerations in light of the purpose of attorney discipline which is not to punish the attorney blit to protect the courts, the public and the'legal profession, and to guard the administration of justice. See In re Madsen, 426 N.W.2d 434, 435 (Minn.1988) (citing In re Peck, 302 N.W.2d 356, 359 (Minn.1981)).

Our previous cases have made plain that a felony conviction warrants disbarment unless there are significant mitigating factors. See, e.g., In re Anderley, 481 N.W.2d 366, 369 (Minn.1992). We have generally disbarred attorneys convicted of racketeering or mail fraud, see id. at 370 (disbarring attorney who pled guilty to mail fraud); In re Kraemer, 361 N.W.2d 402, 40.5 (Minn.1985) (disbarring attorney convicted of interstate transportation of stolen goods, mail fraud, conspiracy, and theft); In re Holman, 322 N.W.2d 726, 726 (Minn.1982) (disbarring attorney convicted of racketeering, aiding and abetting, interstate transportation of property obtained by fraud and mail fraud), as well as attorneys who have committed felonies in the course of their law practice, see In re Shoemaker, 518 N.W.2d at 555 (disbarring attorney who misappropriated funds from law firm employer).

The referee concluded that respondent failed to show any mitigating circumstances or contrition for his conduct justifying a sanction less severe than disbarment. We agree.

Disbarment is ordered.

Respondent is ordered to pay $900 in costs and disbursements pursuant to Rules 24(a) and (b), RLPR. .

      . See Cal. Bus. & Prof.Code § 6102(c) (West 1990).

      . Rule 8.4 prohibits behavior by an attorney that is criminal and reflects adversely on the attorney’s honesty, that is dishonest or fraudulent, or that is prejudicial to the administration of justice:
      It is professional misconduct for a lawyer to:

      (b) commit a criminal act that reflects adversely on the lawyer's honesty, trustworthiness or fitness as a lawyer in other respects;
      (c) engage in conduct involving dishonesty, fraud, deceit or misrepresentation;
      (d) engage in conduct that is prejudicial to the administration of justice * * ⅜.
      Minn. R. Prof. Conduct 8.4(b) — (d).