text:
    2006 ND 228
    In the Matter of the DISCIPLINARY ACTION AGAINST James R. BULLIS, a Member of the Bar of the State of North Dakota. Disciplinary Board of the Supreme Court of the State of North Dakota, Petitioner, v. James R. Bullis, Respondent.
    No. 20060132.
    Supreme Court of North Dakota.
    Nov. 13, 2006.

      Brent J. Edison, Assistant Disciplinary Counsel, Bismarck, N.D., for petitioner.
    Ronald H. McLean (argued) and Joseph A. Wetch, Jr., (on brief), Serkland Law Firm, Fargo, N.D., for respondent.
   SUSPENSION ORDERED.

PER CURIAM.

[¶ 1] James R. Bullís challenges a Disciplinary Board hearing panel report finding that he violated N.D.R. Prof. Conduct 1.7(a), (b), and (c), and 1.8(a) and (b), and recommending that Bullís be reprimanded, complete six hours of non-self-study continuing legal education (“CLE”) in the area of conflicts of interest within the next two years in addition to the mandatory CLE requirements, and pay the costs and expenses of the disciplinary proceeding in the amount of $5,181.15. We conclude there is clear and convincing evidence Bul-lís violated N.D.R. Prof. Conduct 1.7(a), (b), and (e), and 1.8(a) and (b). We order that Bullís be suspended from the practice of law for 90 days, rather than be reprimanded, and adopt the other sanctions recommended by the panel.

I

[¶ 2] Bullís was admitted to practice law in North Dakota on October 1, 1992. Since then, he has worked in law offices located in Fargo and Moorhead, Minnesota. In 1997, Bullis began acting as Michael Volk’s attorney for various personal and business matters.

[¶ 3] In 2000, Bullis opened a new law firm in the Amber Valley Parkway area of Fargo. Kevin Christianson was the landlord of the building in which the law firm was located. At that time, Volk was employed as the chief financial officer for Intellisol, Inc., an Australian computer software company which had offices in the same building as the law firm. Intellisol granted Volk an option to purchase 110,-000 shares of Intellisol stock for $10 per share, which was less than the market value of the stock. However, Volk did not have the funds available to exercise the option. Volk consulted with Bullis, and Bullis recommended that Volk contact Bruce Hager, a Fargo stockbroker, for suggestions on how to raise the money to exercise the option. Bullis also set up a series of limited liability companies to be used as holding companies to effectuate the transfer of Volk’s Intellisol stock.

[¶ 4] Hager found a group of investors willing to purchase the stock, and in April 2000, Bullis and Volk traveled to Phoenix, Arizona, and met with the Fargo Capital Group to structure the transaction. The Fargo Capital Group was a limited liability company consisting of former Fargo residents living in the Phoenix area. Volk sold the Fargo Capital Group approximately 30,000 of his option shares for $1.2 million. Bullis used his law firm trust account to handle the money for Volk’s Intellisol stock transactions. Hager received a 5 percent commission on each sale of stock and Bullis received 5 percent for “legal fees.”

[¶ 5] After the sale, Volk had approximately 80,000 shares of stock remaining, but he also needed funds to pay for his income tax liability incurred in exercising the option. Hager found another investor, James D. Ellefson from Ada, Minnesota, who was interested in purchasing Intellisol stock. Ellefson had approached Hager for financial advice in early 2000, and Hager began managing a substantial amount of his investments. Ellefson chose Hager because Hager advertised as a full service investment advisor with connections to certified public accountants and attorneys. In June 2000, Ellefson purchased approximately 30,000 shares of Intellisol stock for $100,000. Hager had Bullis complete the paperwork for the transaction and the money was paid to Bullis’s law firm. El-lefson also completed a prospective investor questionnaire for Bullis disclosing his net worth. According to Bullis, he acted as Volk’s attorney for this transaction. The shares were then transferred to Ellef-son’s revocable living trust. In October 2000, Volk was fired from his position with Intellisol.

[¶ 6] In December 2000, Hager sold Ellefson life insurance to be héld in trust for estate planning purposes and had Bul-lis handle the legal work for the transaction. Bullis drafted an irrevocable trust agreement for Ellefson. Bullis served as Ellefson’s attorney in the transaction and was named trustee of the trust.

[¶ 7] In spring 2001, Ellefson decided to invest further in Intellisol. Ellefson purchased $500,000 worth of stock warrants, giving him an option to acquire additional shares of Intellisol stock. In exchange for the stock warrants, Ellefson was required to co-make a note with Intel-lisol at Wells Fargo Bank in Moorhead, Minnesota, for $500,000 with a maturity date of September 1, 2001. Bullis served as Intellisol’s attorney in this transaction, but Ellefson testified he believed Bullis was acting as his attorney because “it was represented to me that Bruce Hager and Jim Bullis were representing my best interests.”

[¶ 8] By October 2001, Intellisol was in default with its creditors, including Ellef-son,'the Fargo Capital Group, and Chris-tianson, Intellisol’s landlord. The Fargo Capital Group took over control of Intelli-sol to protect its investment in the company. The Fargo Capital Group proposed a work-out agreement under which Intellisol could cure its defaults with its larger creditors. Bullís represented Ellefson and Christianson in connection with the proposed work-out agreement. Bullís did not advise Ellefson of his joint representation of Christianson, but Ellefson learned of the joint representation when he was copied on correspondence indicating Christianson was also Bullis’s client. In November 2001, Bullís also represented Ellefson in connection with Ellefson’s negotiations with Intellisol regarding the terms for renewal of the $500,000 note Ellefson had previously signed as co-maker. Bullís invoiced legal services to both Ellefson and Intellisol for work completed in connection with the work-out agreement and the renewal of the note, but the invoices were submitted to Intellisol for payment.

[¶ 9] In March 2002, Intellisol ceased operations and was taken over by Workforce ROI, LLC, a company consisting of some members of the Fargo Capital Group. At this time, Ellefson still owed the Wells Fargo Bank $500,000. Ellefson declined an opportunity afforded him as a convertible note-holder to purchase shares in Workforce ROI. After Ellefson declined, Bullís informed Ellefson that Bullís and others were interested in purchasing Ellef-son’s right to buy shares in Workforce ROI. Bullís told Ellefson he would have a conflict of interest in advising Ellefson concerning the transaction, telling him “I can’t represent you. I can’t tell you why I can’t represent you, but Bruce [Hager] can tell you why I can’t represent you. You may want to check with your estate planning counsel if you have any concerns about this.” Ellefson did not consult with another attorney, and Ellefson’s right to acquire shares was purchased for $100,000 by AV IV, LLC, a limited liability company composed of Hager, Christianson, and GMB Investments, LLC. GMB Investments is a limited liability company composed of Bullís and his law partners, which also owned 50,000 shares of Intellisol stock. Bullís drafted the agreement under which Ellefson’s interests were purchased and acted as AV TV’s lawyer in the transaction. The agreement allowed for the possibility of Ellefson recouping $483,259.67, but only if AV IV first recouped its original investments and prior Intellisol losses in the amount of $1,046,837.54.

[¶ 10] During the time he represented Ellefson, Bullís did not advise him of his relationship with Volk, Hager, and Intelli-sol; the various legal entities Bullís had created for Volk to effectuate the transfer of Intellisol stock; the arrangement in which Bullís and Hager each received 5 percent for each sale of stock; and Bullís and his law partners’ ownership of 50,000 shares of Intellisol stock. Ellefson filed a complaint with the Disciplinary Board upon learning of Bullis’s various relationships through a newspaper article.

[¶ 11] Following a hearing, the hearing panel found that Bullís violated N.D.R. Prof. Conduct 1.7(a), (b), and (c) because his loyalties were impaired by conflicting responsibilities as the lawyer for Volk, In-tellisol, Ellefson, Christianson, and AV IV; as the business associate of Volk, Hager and Christianson; as trustee of the Ellef-son irrevocable trust; and as an owner of Intellisol stock. The panel also found that Bullís violated N.D.R. Prof. Conduct 1.8(a) and (b) because Bullís used his knowledge of Ellefson’s investment strategies to his advantage and failed to advise Ellefson to seek independent counsel. The panel recommended:

1. Reprimand under Standard 4.33, N.D. Stds[.] Imposing Lawyer Sanctions;
2. A requirement that, in addition to the mandatory continuing legal education (CLE) requirements of Rule 3, N.D.R. Continuing Legal Ed., Bullís complete six hours of CLE in the area of conflicts of interest and how to avoid them within the next 24 months, these six hours shall be active CLE courses and not self study;
3. An assessment of costs and expenses of the disciplinary proceeding in the amount of $5,181.15.

II

[¶ 12] In In re Chinquist, 2006 ND 107, ¶ 7, 714 N.W.2d 469 (citations omitted), we set forth our standard of review for disciplinary proceedings:

We review disciplinary proceedings de novo on the record. We accord due weight to the findings, conclusions, and recommendations of the hearing panel, but we do not act as a mere rubber stamp. Disciplinary counsel bears the burden of proving each alleged violation of the disciplinary rules by clear and convincing evidence. Each disciplinary case must be considered upon its own facts to decide what discipline, if any, is warranted.

Because the hearing panel had the opportunity to hear the witnesses and observe their demeanor, we accord special deference to its findings on matters of conflicting evidence. In re Crary, 2002 ND 9, ¶ 7, 638 N.W.2d 23.

A

[¶ 13] The hearing panel found that Bullís violated N.D.R. Prof. Conduct 1.7(a), (b), and (c), which provide:

(a) A lawyer shall not represent a client if the lawyer’s ability to consider, recommend, or carry out a course of action on behalf of the client will be adversely affected by the lawyer’s responsibilities to another client or to a third person, or by the lawyer’s own interests.
(b) A lawyer shall not represent a client when the lawyer’s own interests are likely to adversely affect the representation.
(c) A lawyer shall not represent a client if the representation of that client might be adversely affected by the lawyer’s responsibilities to another client or to a third person, or by the lawyer’s own interests, unless:
(1) The lawyer reasonably, believes the representation will not be adversely affected; and
(2) The client consents after consultation. When representation of multiple clients in a single matter is undertaken, the consultation shall include explanation of the implications of the common representation and the advantages and risks involved.

Conflicts of interest affect a lawyer’s loyalty, which “is an essential element in the lawyer’s relationship to a client.” Comment, N.D.R. Prof. Conduct 1.7; see also Continental Res., Inc. v. Schmalenberger, 2003 ND 26, ¶ 12, 656 N.W.2d 730. When a lawyer has conflicting responsibilities as the lawyer for various clients, those loyalties owed to the client are impaired. See In re Christensen, 2005 ND 87, ¶ 14, 696 N.W.2d 495. “The mere possibility of adverse effect upon exercise of free judgment prevents a lawyer from representing clients with opposing interests.” In re Gerde, 634 N.E.2d 494, 497 (Ind.1994). Although the conflict situation described in subsection (c) of the rule may be waived by the client, if a conflict situation described in subsections (a) and (b) arises, “the lawyer is absolutely prohibited from undertaking or continuing representation of the client.” Comment, N.D.R. Prof. Conduct 1.7.

[¶ 14] We agree with the hearing panel that Bullis’s ability to consider, recommend, and carry out a course of action on behalf of Ellefson was adversely affected by Bullis’s responsibilities to other clients, including Volk, Intellisol, Chris-tianson, and AV TV; to third party business associates, including Volk, Hager, and Christianson; and by Bullis’s own interests. Although Bullís contends he had no attorney-client relationship with Ellefson until late 2001 when he represented Ellef-son and Christianson in connection with the work-out agreement, Bullís created the irrevocable living trust for Ellefson in December 2000 and served as the trustee throughout these various transactions after creation of the trust.- While Bullís characterizes creation of the trust as a “minor transaction,” Ellefson afterward believed Bullís was representing him in spring 2001 when he was co-maker of a note in exchange for the Intellisol stock warrants, even though Bullís was actually representing Intellisol. Ellefson’s belief is understandable considering Bullis’s creation of the trust only a few months earlier and his continuing service as the trustee. The attorney-client relationship continues as long as the influence arising from the attorney-client relationship continues. See In re Giese, 2003 ND 82, ¶ 17, 662 N.W.2d 250.

[¶ 15] We also reject Bullis’s argument that his multiple representations did not run afoul of N.D.R. Prof. Conduct 1.7 because “[a]ll of the interests of his clients were the same.” Bullis’s law firm owned 50,000 shares of Intellisol stock and Bullís received a 5 percent “legal fee” on each sale of Intellisol stock. Bullís had longstanding personal relationships with Volk, Intellisol, and Hager, and provided legal representation to Volk and Intellisol. Bul-lís initially represented Volk when Ellefson purchased $100,000 worth of Intellisol stock, and his representation of Volk was not disclosed to Ellefson. Bullís proceeded to create the irrevocable living trust for Ellefson and served as its trustee. Bullís then represented Intellisol when Ellefson purchased $500,000 worth of Intellisol stock warrants, before again representing Ellefson concerning the work-out agreement and the negotiations with Intellisol for renewal of the $500,000 note. Unbeknownst to Ellefson, Bullís also represented Christianson in connection with the work-out agreement, and Christianson would ultimately become part of AV IV, the company that purchased Ellefson’s right to buy shares in Workforce ROI. Bullís acted as AV TV’s attorney in this final transaction and also had an interest in AV IV.

[¶ 16] Ellefson’s interests as an investor in and creditor of Intellisol were directly adverse to the interests of Volk and Intellisol. Intellisol’s interests were adverse to Christianson’s interests as a creditor of Intellisol. Ellefson’s interests were also adverse to Christianson’s interests, at least by the time AV IV purchased Ellefson’s rights, and Ellefson’s interests were adverse to AV IV’s interests. Bul-lis’s interests as an Intellisol stockholder and recipient of “legal fees” upon each sale of stock were also adverse to Ellefson’s interests. Yet, Bullís never sought consent for his multiple representations. Indeed, during a relatively short time span, Bullís switched back and forth representing Volk, Intellisol, Ellefson, Christianson, and AV IV. This Court has condemned the practice of “side-switching” because of the appearance of impropriety which will create the client’s suspicion that the attorney has breached the duty of fidelity and loyalty to the client. See Continental Res., Inc., 2003 ND 26, ¶24, 656 N.W.2d 730; Heringer v. Haskell, 536 N.W.2d 362, 366-67 (N.D.1995). The impropriety is worse when the client is apparently unaware that his attorney has switched sides. An attorney representing multiple clients cannot by subjective or secret analysis eliminate one as a current client and decide that he is only representing another current client on a particular transaction. See In re Vaile, 300 Or. 91, 707 P.2d 52, 55 (1985).

[¶ 17] We conclude there is clear and convincing evidence that Bullís violated N.D.R. Prof. Conduct 1.7(a), (b), and (c).

B

[¶ 18] The panel also found Bullís violated N.D.R. Prof. Conduct 1.8(a) and (b), which provide:

(a) Except for standard commercial transactions involving products or services that the client generally markets to others, a lawyer shall not enter into a business, financial or property transaction with a client unless:
(1) The transaction is fair and reasonable to the client; and
(2) After consultation, including advice to seek independent counsel, the client consents to the transaction.
(b) Except as permitted or required in N.D.R. Prof. Conduct 1.6 and 3.3, a lawyer shall not use information relating to representation of a client to the disadvantage of the client for purposes of furthering either the lawyer’s or another person’s interest unless after consultation, including advice to seek independent counsel, the client consents.

The hearing panel reasoned this rule was violated because Bullís used his knowledge of Ellefson’s investment strategies to his advantage and failed to advise Ellefson to seek independent counsel. Bullís argues the rule was not violated because the transaction in which AV IV purchased El-lefson’s right to buy shares was fair and reasonable to Ellefson; because he advised Ellefson to contact his estate counsel about the transaction; and because he did not use any information gained during the representation to Ellefson’s disadvantage.

[¶ 19] “Business transactions between an attorney and client are fraught with pitfalls and traps, and an attorney, with his superior knowledge and education, engages in business transactions with a client at the attorney’s peril and is held to the highest standards.” Giese, 2003 ND 82, ¶ 22, 662 N.W.2d 250. Bullís was well aware of Ellefson’s financial situation through the prospective investor questionnaire and his representations of him. Bul-lis did not disclose to Ellefson that he had a longstanding business relationship with Volk, Hager, and Intellisol; that his law firm owned Intellisol stock; and that he was receiving a 5 percent fee from each sale of Intellisol stock. After the initial sale of stock to Ellefson and after Bullís created the trust for Ellefson, Bullís represented Intellisol in securing an additional $500,000 commitment from Ellefson in the form of stock warrants. After having again represented Ellefson in connection with renewal of the $500,000 note, Bullís represented AV IV, a company in which he had a stake, in purchasing Ellefson’s right to invest in Workforce ROI.

[¶ 20] We have said the prohibition against transactions with a client continues as long as the influence arising from the attorney-client relationship continues. Giese, 2003 ND 82, ¶ 17, 662 N.W.2d 250. Ellefson testified that he has lost approximately $491,000 through these transactions, and denied that Bullís told him to secure independent legal advice. Although Bullís testified he informed Ellef-son that he could not represent him because of a conflict of interest, Bullís did not explain what the conflict was and proceeded to acquire Ellefson’s interests as the lawyer for AV IV. An attorney must take precautions to ensure a client is fully aware of the details and risks of such a transaction, “and a passing suggestion to consult a second attorney does not discharge an attorney’s obligation.” Id. at ¶22. We agree with the hearing panel that these circumstances establish Bullís used his knowledge of Ellefson’s investment strategies to his advantage and failed to adequately advise Ellefson to seek independent counsel.

[¶ 21] We conclude there is clear and convincing evidence that Bullís violated N.D.R. Prof. Conduct 1.8(a) and (b).

Ill

[¶ 22] The hearing panel recommended that Bullís be reprimanded, complete six additional hours of non-self-study continuing legal education on conflicts of interest within the next two years, and pay $5,181.15 for the costs and expenses of the disciplinary proceeding. Disciplinary counsel argues that a reprimand is inappropriate under the circumstances, and Bullís should be suspended for 90 days in addition to the other sanctions recommended by the panel.

[¶ 23] Under N.D. Stds. Imposing Lawyer Sanctions 2.1, 2.2, and 2.4, potential sanctions include disbarment, suspension, and reprimand. See Chinquist, 2006 ND 107, ¶21, 714 N.W.2d 469. In determining a proper sanction, N.D. Stds. Imposing Lawyer Sanctions 3.0 directs that this Court consider “(a) the duty violated; (b) the lawyer’s mental state; (c) the potential or actual injury caused by the lawyer’s misconduct; and (d) the existence of aggravating or mitigating factors.” Sanctions for failure to avoid conflicts of interest are explained in N.D. Stds. Imposing Lawyer Sanctions 4.3, which provides in relevant part:

Absent aggravating or mitigating circumstances, upon application of the factors set out in N.D. Stds. Imposing Lawyer Sanctions 3.0, the following sanctions are generally appropriate in cases involving conflicts of interest:
4.32 Suspension is generally appropriate when a lawyer knows of a conflict of interest and does not fully disclose to a client the possible effect of that conflict, and causes injury or potential injury to a client.
4.33 Reprimand is generally appropriate when a lawyer is negligent in determining whether the representation of a client may be materially affected by the lawyer’s own interests, or whether the representation will adversely affect another client, and causes injury or potential injury to a client. The issuance of an admonition should be limited to cases of negligence which cause no serious injury or little or no injury to a client. A reprimand is not a sufficiently harsh sanction in an instance where the lawyer’s negligence causes substantial injury to a client.

The hearing panel decided a reprimand was appropriate because “Bullís exercised poor judgment and was negligent in determining there was a conflict and caused injury or potential injury to the client.”

[¶ 24] “Knowledge” and “Negligence” are defined in the definitions section of the North Dakota Standards for Imposing Lawyer Sanctions:

“Knowledge” is the conscious awareness of the nature or attendant circumstances of the conduct but without the conscious objective or purpose to accomplish a particular result.
“Negligence” is the failure of a lawyer to heed a substantial risk that circumstances exist or that a result will follow, which failure is a deviation from the standard of care that a reasonable lawyer would exercise in the situation.

[¶ 25] We reject the hearing panel’s finding that Bullis’s conduct was the product of mere “negligen[ce]” and “poor judgment.” “A knowing or willful act for purposes of a professional disciplinary proceeding does not require evil intent or bad purpose; rather, the terms mean the act was done in the exercise of the performer’s free will and was not done under coercion.” In re LaQua, 548 N.W.2d 372, 376 (N.D.1996). Bullís demonstrated knowledge ,of a conflict of interest when he testified that he told Ellefson he could not represent him during the transaction in which AV IV purchased Ellefson’s right to buy Intellisol stock. Bullís would not explain the nature of the conflict and proceeded to act as the attorney for AV IV in completing the purchase. Because Bullís acted with knowledge, we believe a suspension from the practice of law is the appropriate sanction.

[¶ 26] The North Dakota Standards for Imposing Lawyer Sanctions are designed to promote “consistency in the imposition of disciplinary sanctions for the same or similar offenses within and among jurisdictions.” N.D. Stds. Imposing Lawyer Sanctions 1.3. Sanctions imposed for conflict of interest violations in North Dakota have ranged from reprimand to disbarment, depending on the egregiousness of the conduct, the existence of other ethical violations, and the presence of mitigating or aggravating factors. See, e.g., In re Christensen, 2005 ND 87, ¶¶ 17-19, 696 N.W.2d 495 (reprimanded and required to successfully complete Multistate Professional Responsibility Examination based on consent to discipline); Giese, 2003 ND 82, ¶ 28, 662 N.W.2d 250 (suspended for 90 days and ordered to pay restitution); Crary, 2002 ND 9, ¶ 27, 638 N.W.2d 23 (disbarred and ordered to pay restitution). Cases from other jurisdictions demonstrate a similar divergence in sanctions imposed. See, e.g., Gerde, 634 N.E.2d 494, 497 (Ind.1994) (reprimanded); Iowa Supreme Court Disciplinary Bd. v. Howe, 706 N.W.2d 360, 382 (Iowa 2005) (indefinitely suspended with no possibility of reinstatement for four months); In re Dato, 130 N.J. 400, 614 A.2d 1344, 1355 (1992) (suspended for one year); In re Gelbwaks, 260 A.D.2d 47, 696 N.Y.S.2d 45, 51 (1999) (disbarred); State ex rel. Oklahoma Bar Ass’n v. McGee, 48 P.3d 787, 794 (Okla.2002) (suspended for four months); Vaile, 300 Or. 91, 707 P.2d 52, 59-60 (1985) (suspended for 60 days and placed on probation); Committee on Legal Ethics v. Frame, 189 W.Va. 641, 433 S.E.2d 579, 584 (1993) (reprimanded).

[¶ 27] Under N.D. Stds. Imposing Lawyer Sanctions 9.22, the hearing panel found as aggravating factors that Bullís committed multiple offenses, refused to acknowledge the wrongful nature of his conduct, and had substantial experience in the practice of law. Under N.D. Stds. Imposing Lawyer Sanctions 9.32, the panel found as mitigating factors Bullis’s lack of a prior disciplinary record, his full and free disclosure to the disciplinary board and cooperative attitude toward the proceedings, and his character and reputation.

[¶ 28] Bullis’s conduct was pervasive and demonstrates an indifference to basic conflict of interest considerations. There has been at least potential injury, if not actual injury, to Ellefson. Having taken into consideration all of the circumstances surrounding Bullis’s misconduct, including aggravating and mitigating circumstances and sanctions imposed under similar circumstances, we order that Bullís be suspended from the practice of law for 90 days commencing January 1, 2007. Bullís must complete six hours of non-self-study CLE courses on conflicts of interest within the next two years in addition to the normal CLE requirements under N.D.R. Continuing Legal Ed. 3. We further order that Bulks pay the costs and expenses of the disciplinary proceeding in the amount of $5,181.15.

[¶ 29] GERALD W. VANDE WALLE, C.J., and WILLIAM F. HODNY, S.J., BENNY A. GRAFF, S.J., CAROL RONNING KAPSNER, and MARY MUEHLEN MARING, JJ., concur.

[¶ 30] The Honorable WILLIAM F. HODNY, S.J., and the Honorable BENNY A. GRAFF, S.J., sitting in place of SANDSTROM, J. and CROTHERS, J., disqualified.

      . We apply the North Dakota Rules of Professional Conduct as they existed when the hearing .was held and the panel issued its recommendations, which occurred before the most recent amendments to the rules became effective on August 1, 2006. See In re Landon, 1999 ND 202, ¶ 19, 600 N.W.2d 856.


source: Caselaw Access Project

author: SANDSTROM, Justice.

license: Public Domain

text:
    2006 ND 229
    Kelly Ray TVERBERG, Claimant and Appellant, v. WORKFORCE SAFETY AND INSURANCE, Appellee, and Delmar Rink Construction, Respondent.
    No. 20060064.
    Supreme Court of North Dakota.
    Nov. 13, 2006.

      Stephen D. Little (on brief), Dietz & Little Lawyers, Bismarck, N.D., for claimant and appellant.
    Jacqueline S. Anderson (on brief), Special Assistant Attorney General, Fargo, N.D., for appellee.
   SANDSTROM, Justice.

[¶ 1] Kelly Ray Tverberg appeals from a judgment affirming a Workforce Safety and Insurance (“WSI”) order that terminated an award of rehabilitation benefits to him and awarded him partial disability benefits under N.D.C.C. § 65-05.1-01(6). We conclude WSI correctly interpreted and applied the provisions for rehabilitation services in N.D.C.C. § 65-05.1-01, and we affirm.

I

[¶ 2] Tverberg sustained a work-related injury to his lower back in July 1998 while employed near Watford City as an equipment operator for a construction firm. WSI accepted Tverberg’s claim for benefits and paid him associated medical and disability benefits. In 2001, WSI initiated vocational rehabilitation services for Tverberg under N.D.C.C. ch. 65-05.1 and determined his first appropriate rehabilitation option under N.D.C.C. § 65-05.1-01(4) was a 24-month retraining program at Bismarck State College. Tverberg claimed he was unable to complete that long-term rehabilitation program, in part, because he lived in Watford City, and that rehabilitation program was discontinued in the spring of 2002.

[¶ 3] After related administrative proceedings regarding Tverberg’s failure to complete the retraining program at Bismarck State College, WSI reopened vocational rehabilitation services for Tverberg in 2004. WSI conducted an updated functional capacities assessment that placed Tverberg in a “Light-Medium” job classification. WSI also learned that after failing to complete the rehabilitation program at Bismarck State College in the spring of 2002, Tverberg had worked as a pipeline repairer from September 2002 through November 2003. In 2004, WSI determined Tverberg’s first appropriate rehabilitation option under N.D.C.C. § 65-05.1-01(4) was long-term retraining and implemented a 24-month vocational rehabilitation program in agribusiness sales and management at Williston State College. Tverberg objected to that program and sought a part-time program that he could complete in three to five years. Although Tverberg started the program at Williston State College in August 2004, he fell behind in his assignments. WSI conducted labor market research to ascertain whether Tverberg had a retained earnings capacity for a vocational determination under N.D.C.C. § 65-05.1-01(6), and a vocational consultant identified the following six jobs for Tverberg: production assembler, fast food worker, service station attendant, cashier, sales clerk, and telephone solicitor.

[¶ 4] In October 2004, WSI issued a notice of intention to discontinue Tver-berg’s rehabilitation plan, informing him that rather than considering his unsatisfactory progress at Williston State College as a failure to comply with the plan, WSI would discontinue his rehabilitation benefits and pay him temporary partial disability benefits under N.D.C.C. § 65-05.1-01(6). WSI thereafter issued an order determining Tverberg’s rehabilitation options would not return him to the lesser of two-thirds of the state’s average weekly wage or ninety percent of his pre-injury earnings. WSI determined Tverberg had a retained earnings capacity because he was able to perform competitive gainful employment and identified the following six jobs within his physical limitations: production assembler, fast food worker, service station attendant, cashier, sales clerk, and telephone solicitor. WSI awarded Tverberg partial disability benefits for a period not to exceed five years based upon two-thirds of the difference between his pre-injury earnings and the greater of his actual wages or his retained earnings capacity of $269.60 per week.

[¶ 5] Tverberg requested a rehearing. After an administrative hearing, an administrative law judge (“ALJ”) recommended affirming WSI’s decision to award Tver-berg partial disability benefits. WSI adopted the ALJ’s recommendation, and the district court thereafter affirmed WSI’s decision.

[¶ 6] The district court had jurisdiction under N.D. Const, art. VI, § 8, and N.D.C.C. §§ 27-05-06, 65-10-01, and 28-32-42. Tverberg’s appeal was timely under N.D.R.App.P. 4(a) and N.D.C.C. § 28-32-49. This Court has jurisdiction under N.D. Const, art. VI, §§ 2 and 6, and N.D.C.C. § 28-32-49.

II

[¶ 7] Courts exercise a limited review in appeals from administrative agency decisions under the Administrative Agencies Practice Act, N.D.C.C. ch. 28-32. Victor v. Workforce Safety Ins., 2006 ND 68, ¶ 12, 711 N.W.2d 188. Under N.D.C.C. § 28-32-46, a district court must affirm an administrative agency order unless:

1. The order is not in accordance with the law.
2. The order is in violation of the constitutional rights -of the appellant.
3. The provisions of this chapter have not been complied with in the proceedings before the agency.
4. The rules or procedure of the agency have not afforded the appellant a fair hearing.
5. The findings of fact made by the agency are not supported by a preponderance of the evidence.
6. The conclusions of law and order of the agency are not supported by its findings of fact.
7. The findings of fact made by the agency do not sufficiently address the evidence presented to the agency by the appellant.
8. The conclusions of law and order of the agency do not sufficiently explain the agency’s rationale for not adopting any contrary recommendations by a hearing officer or an administrative law judge.

[¶ 8] On appeal from a district court’s decision in an administrative appeal, we review the agency order in the same manner. N.D.C.C. § 28-32-49; Victor, 2006 ND 68, ¶ 12, 711 N.W.2d 188. WSI is responsible for weighing the credibility of witnesses and resolving conflicts in the evidence, Grotte v. North Dakota Workers’ Comp. Bureau, 489 N.W.2d 875, 878 (N.D.1992), and we do not “make independent findings of fact or substitute our judgment for that of the agency. We determine only whether a reasoning mind reasonably could have determined that the factual conclusions reached were proved by the weight of the evidence from the entire record.” Power Fuels, Inc. v. Elkin, 283 N.W.2d 214, 220 (N.D.1979).

Ill

[¶ 9] Tverberg challenges WSI’s determination that he is employable as a production assembler, fast food worker, service station attendant, cashier, sales clerk, or telephone solicitor. He claims those jobs will not reasonably result in any retained earnings capacity because no reasonable person would leave a family and home in Watford City to look for those jobs. He asserts those jobs will not reasonably result in an adequate retained earnings capacity and he is entitled to temporary total disability benefits until WSI can identify a rehabilitation option under which he can reasonably replace his lost wages.

[¶10] WSI responds that N.D.C.C. § 65-05.1-01(6) applies when none of the rehabilitation options in N.D.C.C. § 65-05.1-01(4) are appropriate and provides a mechanism for assessing an individual’s employability and entitlement to ongoing disability benefits. WSI argues N.D.C.C. § 65-05.1-01(6) is intended to determine an injured worker’s retained earnings capacity for the calculation of temporary partial disability benefits and represents a legislative determination that the injured worker will be paid only partial disability benefits based on that retained earnings capacity. WSI asserts N.D.C.C. § 65-05.1-01(6) does not depend on where an injured worker resides in North Dakota and argues a reasoning mind could reasonably conclude that Tverberg has a retained earnings capacity, entitling him only to temporary partial disability benefits.

[¶ 11] Statutory interpretation is a question of law, GO Comm. ex rel. Hale v. City of Minot, 2005 ND 136, ¶ 9, 701 N.W.2d 865, and “[questions of law, including the interpretation of a statute, are fully reviewable on appeal from an administrative decision.” Barnes v. Workforce Safety & Ins., 2003 ND 141, ¶ 9, 668 N.W.2d 290. The primary objective in interpreting a statute is to determine the legislature’s intent. Amerada Hess Corp. v. State ex rel. Tax Comm’r, 2005 ND 155, ¶ 12, 704 N.W.2d 8. Words in a statute are given their plain, ordinary, and commonly understood meaning, unless defined by statute or unless a contrary intention plainly appears. N.D.C.C. § 1-02-02. Statutes are construed as a whole and are harmonized to give meaning to related provisions. N.D.C.C. § 1-02-07. If the language of a statute is clear and unambiguous, “the letter of [the statute] is not to be disregarded under the pretext of pursuing its spirit.” N.D.C.C. § 1-02-05. The language of a statute must be interpreted in context and according to the rules of grammar, giving meaning and effect to every word, phrase, and sentence. N.D.C.C. §§ 1-02-03 and 1-02-38(2). We construe statutes to give effect to all of their provisions, so that no part of the statute is rendered inoperative or superfluous. N.D.C.C. § 1-02-38(2) and (4).

[¶ 12] At the time relevant to Tverberg’s claim, N.D.C.C. § 65-05.1-01 authorized rehabilitation services and provided, in part:

3. It is the goal of vocational rehabilitation to return the disabled employee to substantial gainful employment with a minimum of retraining, as soon as possible after an injury occurs. “Substantial gainful employment” means bona fide work, for remuneration, which is reasonably attainable in light of the individual’s injury, functional capacities, education, previous occupation, experience, and transferable skills, and which offers an opportunity to restore the employee as soon as practicable and as nearly as possible to ninety percent of the employee’s average weekly earnings at the time of injury, or to sixty-six and two-thirds percent of the average weekly wage in this state on the date the rehabilitation consultant’s report is issued under section 65-05.1-02.1, whichever is less. The purpose of defining substantial gainful employment in terms of earnings is to determine the first appropriate priority option under subsection 4 which meets this income test set out above.
4. The first appropriate option among the following, calculated to return the employee to substantial gainful employment, must be chosen for the employee:
a. Return to the same position.
b. Return to the same occupation, any employer.
c. Return to a modified position.
d. Return to a modified or alternative occupation, any employer.
e. Return to an occupation within the local job pool of the locale in which the claimant was living at the date of injury or of the employee’s current address which is suited to the employee’s education, experience, and marketable skills.
f. Return to an occupation in the statewide job pool which is suited to the employee’s education, experience, and marketable skills.
g. On-the-job training.
h. Short-term retraining of fifty-two weeks or less.
i. Long-term retraining of one hundred four weeks or less.
j. Self-employment.
6. a. If the vocational consultant concludes that none of the priority options under subsection 4 of section 65-05.1-01 are viable, and will not return the employee to the lesser of sixty-six and two-thirds percent of the average weekly wage, or ninety percent of the employee’s preinjury earnings, the employee shall continue to minimize the loss of earnings capacity, to seek, obtain, and retain employment:
(1) That meets the employee’s functional capacities;
(2) For which the employee meets the qualifications to compete; and
(3) That will reasonably result in retained earnings capacity equivalent to the lesser of ninety percent of the employee’s preinjury earnings or the state’s current hourly minimum wage on the date the rehabilitation consultant’s report is issued. If an employee is initially released to part-time employment by the doctor, the income test defined under this paragraph must be waived provided there is a reasonable expectation that the employee will return to full-time employment meeting the income test previously defined under this paragraph.
b. Under section 65-05-10, the organization shall award partial disability based on retained earnings capacity calculated under this section.

[¶ 13] The rehabilitation provisions in N.D.C.C. ch. 65-05.1 are intended to return an injured employee to substantial gainful employment with a minimum of retraining as soon as possible after a work injury, but those provisions do not require complete rehabilitation to preinjury earning capacity. Lucier v. North Dakota Workers Comp. Bureau, 556 N.W.2d 56, 59 (N.D.1996). Section 65-05.1-01(3), N.D.C.C., defines substantial gainful employment as bona fide work that offers an opportunity to return the employee to the lesser of ninety percent of the employee’s average weekly earnings at the time of the injury, or two-thirds of the state average weekly wage on the date the rehabilitation consultant’s report is issued.

[¶ 14] The plain language of N.D.C.C. § 65-05.1-01(6) indicates it applies if the vocational consultant determines none of the priority options under N.D.C.C. § 65-05.1-01(4) are viable and will not return the employee to the lessor of two-thirds of the average weekly wage or ninety percent of the employee’s prein-jury earnings. If those priority options are not viable and will not return the employee to substantial gainful employment, N.D.C.C. § 65-05.1-01(6) authorizes an award of partial disability benefits based on a calculation for retained earnings capacity under that section. The plain language of N.D.C.C. § 65-05.1-01(6) represents a legislative determination that the benefits under that provision are available if none of the priority options under N.D.C.C. § 65-05.1-01(4) are viable to return the employee to substantial gainful employment. The language of N.D.C.C. 65-05.1-01(6) indicates it is not a vocational rehabilitation plan, but applies to determine an injured employee’s retained earnings capacity for the calculation of partial disability benefits and is distinct from the hierarchy of rehabilitation options in N.D.C.C. § 65-05.1-01(4). That interpretation of N.D.C.C. § 65-05.1-01(6) gives meaning to the plain language of the rehabilitation and workers’ compensation statutes as a whole and explicitly incorporates N.D.C.C. § 65-05-10, which says an “employee’s earnings capacity may be established by expert vocational evidence of a capacity to earn in the statewide job pool.” N.D.C.C § 65-05-10(3). When read together, those statutes authorize WSI to use a statewide job pool to calculate retained earnings capacity under N.D.C.C. § 65-05.1-01(6).

[¶ 15] We conclude there is evidence from which a reasoning mind could reasonably conclude Tverberg was unwilling to complete the 24-month rehabilitation program at Williston State College under the hierarchy of options in N.D.C.C. § 65-05.1-01(4) and none of his rehabilitation options would return him to the lesser of two-thirds of the state’s average weekly wage or ninety percent of his preinjury earnings, which triggered application of N.D.C.C. § 65-05.1-01(6). We, therefore, conclude WSI correctly interpreted- and applied those rehabilitation provisions to calculate Tverberg’s retained earnings capacity, and its decision is supported by a preponderance of the evidence.

IV

[¶ 16] We affirm the judgment affirming WSI’s order.

[¶ 17] GERALD W. VANDE WALLE, C.J., and WILLIAM F. HODNY, S.J., and CAROL RONNING KAPSNER, and MARY MUEHLEN MARING, JJ., concur.

[¶ 18] The Honorable WILLIAM F. HODNY, Surrogate Judge, sitting in place of CROTHERS, J., disqualified.


author: PER CURIAM.

text:
    2006 ND 230
    In the Matter of the APPLICATION FOR DISCIPLINARY ACTION AGAINST Steven K. AAKRE, a person admitted to the Bar of the State of North Dakota. Disciplinary Board of the Supreme Court of the State of North Dakota, Petitioner, v. Steven K. Aakre, Respondent.
    No. 20060260.
    Supreme Court of North Dakota.
    Nov. 14, 2006.
   SUSPENSION ORDERED.

PER CURIAM.

[¶ 1] Steven K. Aakre (“Aakre”) was admitted as an attorney in North Dakota on October 5, 1981, and his name has appeared on the roll of attorneys since that date. On June 29, 2006, Aakre was placed on interim suspension after violating the terms the Supreme Court’s November 28, 2005, Order, denying an interim suspension and setting forth the conditions under which Aakre could continue practicing law. Disciplinary Board Aakre, 2006 ND 146, 718 N.W.2d 1.

[¶ 2] On July 20, 2006, Aakre admitted service of a Summons, Petition for Discipline, and Notice of Appointment of Hearing Panel. The Petition alleges that Aakre took $75,506 from Serkland Law Firm between June 2003 and May 2005, and that he violated the terms of the Supreme Court’s November 28, 2005, Order which set forth the conditions under which Aakre was permitted to practice law.

[¶ 3] The Petition further asserts that Aakre violated:

N.D.R. Prof. Conduct 1.15(a), Safekeeping Property, (a lawyer shall hold property of clients or third persons that is in a lawyer’s possession in connection with a representation separate from the lawyer’s own property);

N.D.R. Lawyer Discipl. 1.2(A)(2)(a lawyer may be disciplined for committing a criminal act that reflects adversely on the lawyer’s honesty, trustworthiness, or fitness as a lawyer as a result of violating N.D.C.C. §§ 12.1-23-07, Misapplication of Entrusted Property, and 12.1-23-02, Theft of Property);

N.D.R. Lawyer Discipl. 1.2(A)(3)(a lawyer may be disciplined for engaging in conduct involving dishonesty, fraud, deceit or misrepresentation);

N.D.R. Prof. Conduct 3.4, Fairness to Opposing Party and Counsel (a lawyer shall not knowingly disobey an obligation under the rules of a tribunal except for an open refusal based on an assertion that no valid obligation exists);

N.D.R. Prof. Conduct 8.4, Misconduct (it is professional misconduct for a lawyer to engage in conduct enumerated in the North Dakota Century Code, such as N.D.C.C. §§ 12-13-01(1) and 27-14-02, as a basis for revocation or suspension of a lawyer’s certificate of admission).

[¶ 4] On August 15, 2006, Aakre filed an Answer to the Petition admitting the underlying facts in the matter, but asserting several of the rules and statutes are not applicable in this matter. Aakre further asserts there are mitigating factors under N.D..Stds. Imposing Lawyer Sanctions 9.82(e)(full and free disclosure to disciplinary board or cooperative attitude toward proceedings).

[¶ 5] On October 2, 2006, a Stipulation and Consent to Discipline was filed by Aakre and Disciplinary Counsel, stipulating to Aakre’s suspension from the practice of law for eighteen months, retroactive to June 29, 2006, and payment of costs in the amount of $1,000 to be paid no later than the end of the suspension period, for violation of N.D.R. Lawyer' Discipl. 1.2(A)(3); N.D.R. Prof. Conduct 3.4, Fairness to Opposing Party and Counsel; and N.D.R. Prof. Conduct. 8.4, Misconduct. The Stipulation and Consent to Discipline was referred to the Hearing Panel under N.D.R. Lawyer Discipl. 4.2(B).

[¶ 6] The Hearing Panel filed its Findings, Conclusions and Recommendation on October 2, 2006, finding that Aakre improperly took $75,506 from the Serkland Law Firm between June 2003 and May 2005. The money was repaid and Aakre self-reported the matter to the Disciplinary Board. The Hearing Panel also found that Aakre violated the Supreme Court’s November 28, 2005, Order, denying an interim suspension and permitting him to practice under strict conditions.

[¶ 7] The Hearing Panel concluded that Aakre’s actions violated N.D.R. Lawyer Discipl. 1.2(A)(3); N.D.R. Prof. Conduct 3.4, Fairness to Opposing Party and Counsel; and N.D.R. Prof. Conduct. 8.4, Misconduct, through violation of N.D.C.C. § 27 — 13—01(1). The Hearing Panel recommended that Aakre be suspended from the practice of law for eighteen months, retroactive to June 29, 2006, and pay costs in the amount of $1,000, to be paid no later than the end of the suspension period.

[¶ 8] The matter was referred to the Supreme Court under N.D.R. Lawyer Dis-cipl. 3.1(F). No objections to the Findings, Conclusions and Recommendation were filed under N.D.R. Lawyer Discipl. 3.1(F)(2). The Court considered the matter, and

[¶ 9] ORDERED, the Stipulation and Consent to Discipline and the Findings, Conclusions and Recommendation of the Hearing Panel are accepted, and Steven K. Aakre is suspended from the practice of law for a period of eighteen months, retroactive to June 29, 2006.

[¶ 10] FURTHER ORDERED, Steven K. Aakre pay the costs and expenses of the disciplinary proceeding in the amount of $1,000, payable to the Secretary of the Disciplinary Board, to be paid no later than the end of the suspension period.

[¶ 11] FURTHER ORDERED, Steven K. Aakre must petition for reinstatement under N.D.R. Lawyer Discipl. 4.5, governing reinstatement following a long suspension.

[¶ 12] GERALD W. VANDE WALLE, C.J., DANIEL J. CROTHERS, and CAROL RONNING KAPSNER, JJ„ concur.

[¶ 13] Justice DALE V. SANDSTROM and Justice MARY MUEHLEN MARING, deeming themselves disqualified, did not participate in this decision.


author: CROTHERS, Justice.

text:
    2006 ND 231
    TRINITY HOSPITALS, a North Dakota non-profit corporation, Petitioners, v. The Honorable Douglas L. MATTSON, Judge of the District Court, Northwest Judicial District, and Laura Phillips, as Co-Personal Representative, of the Estate of Eleanor Neiss and on behalf of the Heirs at Law of Eleanor Neiss, Respondents.
    No. 20060121.
    Supreme Court of North Dakota.
    Nov. 15, 2006.

      Brenda L. Blazer (argued) and Michael T. Andrews (on brief), Vogel Law Firm, Bismarck, N.D., for petitioners.
    Anthony J. Weiler (argued) and David S. Maring (appeared), Maring Williams Law Office, Bismarck, N.D., for respondents.
   CROTHERS, Justice.

[¶ 1] Trinity Hospitals, a North Dakota non-profit corporation, petitions for a supervisory writ, asking this Court to direct the district court to vacate its order denying Trinity Hospitals’ motion for summary judgment and to dismiss a wrongful death action by Laura Phillips, as personal representative of the estate of Eleanor Neiss, against Trinity Hospitals. We conclude Trinity Hospitals is immune from suit under the exclusive remedy provisions of workers’ compensation law, and we direct the district court to dismiss Phillips’ action.

I

[¶ 2] Phillips brought a wrongful death action against Trinity Hospitals, alleging Neiss was employed by Trinity Health, a North Dakota non-profit corporation, and was walking in a service tunnel that was owned by Trinity Hospitals and that connected Trinity Hospital St. Joseph’s with the Health Center Medical Arts building in Minot when she fell and hit her head, resulting in serious injuries that led to her death. The accident occurred while other Trinity Health employees were stripping and waxing the floor of the service tunnel. At the time of the accident, Neiss had been assigned to clean the second floor of the Medical Arts building and was using -the service tunnel to return to the Medical Arts building from a cafeteria in Trinity Hospital St. Joseph’s. A “skywalk and service tunnel access and utilities easements agreement” provided that Trinity Hospitals was responsible for the maintenance and upkeep of the service tunnel. Phillips alleged Trinity Hospitals was negligent in “failing to keep the service tunnel in good working order and condition, failing to make necessary repairs, failing to properly maintain, failing to prevent leakage and seepage into the service tunnel, failing to maintain a dry walking/working surface for employees of Trinity Health or others using the tunnel, failing to warn, failing to take reasonable precautions to prevent people from being injured/ killed, and/or otherwise failing to take appropriate safety precautions.”

[¶ 3] Trinity Hospitals answered and moved for summary judgment, asserting Neiss’ surviving spouse had received Workforce Safety and Insurance (“WSI”) benefits through Trinity Health and Phillips was barred from suing Trinity Hospitals under the exclusive remedy provisions of workers’ compensation law because Trinity Health and Trinity Hospitals were the same entity. Trinity Hospitals claimed it is part of Trinity Health, an integrated healthcare system consisting of four nonprofit corporations, Trinity Hospitals, Trinity Homes, Trinity Kenmare Hospital, and Trinity Health Foundation; Trinity Health is governed by a single board of directors and operated by a single administrative team; Trinity Health controls all operations and facilities of the integrated healthcare system, including the repairs, maintenance, and housekeeping for the properties of all four of the related nonprofit corporations; although the assets and liabilities of each corporation are tracked separately, all four corporations’ financial statements are consolidated in Trinity Health’s financial statement; Trinity Health, under its own name and under the name “Trinity Health and Affiliates,” is the only entity that files a tax return, which includes the revenues and expenses for all four corporations; Trinity Hospitals has no employees and all employees in the healthcare system are employees of Trinity Health; Trinity Health is responsible for the payroll of all employees within its healthcare system and Trinity Hospitals does not pay wages to anyone; Trinity Health prepares and distributes all W-2 forms to its employees; Trinity Health uses one employee handbook for all employees in its healthcare system; Trinity Health has one Human Resources Department; Trinity Health employees work between and among all the facilities within the healthcare system and an employee’s salary generally is allocated to the respective entity according to the time the employee works at each entity; Trinity Health pays the WSI premiums for all the employees in the healthcare system; WSI has determined that Trinity Hospitals is not a separate entity from Trinity Health for purposes of WSI coverage; and Trinity Health’s premium payments to WSI covered all employees in the Trinity Health system, including those employees working at Trinity Hospitals.

[¶ 4] The district court denied Trinity Hospitals’ motion for summary judgment, concluding Trinity Hospitals was not immune from tort liability under the exclusive remedy provisions of workers’ compensation law. The court, relying upon a parent and subsidiary analysis in Wodogaza v. H & R Terminals, Inc., 161 Mich. App. 746, 411 N.W.2d 848 (1987), concluded Trinity Hospitals was not the same entity as Trinity Health for purposes of the exclusive remedy provisions. The court decided WSI’s “assessment of the Trinity Health system [was not] of any import” to the issue and Phillips’ action against Trinity Hospitals was not barred by the exclusive remedy provisions of workers’ compensation law. The court thereafter denied Trinity Hospitals’ motion for reconsideration.

II

[¶ 5] Trinity Hospitals petitions this Court for a supervisory writ, asking us to direct the district court to vacate its denial of Trinity Hospitals’ motion for summary judgment and to dismiss Phillips’ action. Trinity Hospitals argues the district court’s decision is erroneous because Trinity Hospitals and Trinity Health are the same entity for purposes of the exclusive remedy provisions. Trinity Hospitals seeks a supervisory writ, asserting the district court’s decision is not appealable and requires Trinity Hospitals to defend a lawsuit in which it is immune from liability. Trinity Hospitals claims it has no adequate alternative remedy. Phillips responds that Trinity Hospitals’ petition for a supervisory writ should be denied because Trinity Hospitals has a right to appeal from any subsequent adverse judgment. Phillips argues Trinity Hospitals is not immune from suit under the exclusive remedy provisions and the district court did not err in denying Trinity Hospitals’ motion for summary judgment.

A

[¶ 6] Our authority to issue supervisory writs originates from N.D. Const, art. VI, § 2, and is a discretionary power that we exercise rarely, cautiously, and not as a matter of right. Dimond v. State Bd. of Higher Educ., 1999 ND 228, ¶ 19, 603 N.W.2d 66. We issue supervisory writs only in extraordinary cases to rectify errors and to prevent injustice when no adequate alternative remedy exists. Id.

[¶ 7] In State v. Haskell, 2001 ND 14, ¶ 4, 621 N.W.2d 358, we concluded a supervisory writ was appropriate to review a district court’s denial of the State’s motion to dismiss a State employee’s termination action where the employee failed to present a statutorily required notice of claim, because the case was extraordinary, the district court erred, and the State had no adequate alternative remedy for appeal from a nonappealable order denying the motion to dismiss. In Mitchell v. Sanborn, 536 N.W.2d 678, 683 (N.D.1995), we concluded a supervisory writ was appropriate because that case embodied important public and private interests in the significance of the exclusive remedy provisions of workers’ compensation law and allegations of a co-employee’s horseplay, and in the posture of that case, there was certain liability against only the co-employee and a reasonable suggestion that expensive and extensive medical discovery would be necessary before a trial on damages.

[¶ 8] We conclude this case is controlled by Mitchell because in this case a similar important public interest in. the workers’ compensation immunity provisions is present. We further conclude this case is extraordinary and Trinity Hospitals has no adequate alternative remedy because the denial of a motion for summary judgment is not appealable. We therefore hold this is an appropriate case in which to exercise our discretionary authority and invoke our supervisory jurisdiction.

B

[¶ 9] Trinity Hospitals argues it is the same entity as Trinity Health and is immune from suit under the exclusive remedy provisions of the workers’ compensation law in N.D.C.C. tit. 65. Trinity Hospitals claims it is completely controlled by Trinity Health and the two entities are so integrated that neither can be viewed as a separate economic entity. Phillips responds that Neiss’ employer, Trinity Health, did not own the service tunnel and was not responsible for its maintenance and that Trinity Hospitals, the corporation that owned the tunnel and was responsible for its maintenance, is a third party responsible for Neiss’ death under N.D.C.C. § 65-01-09.

[¶ 10] The district court decided this case in the posture of a denial of a motion for summary judgment, and our analysis is within that context. Summary judgment is a procedural device for promptly resolving a controversy on the merits without a trial if either party is entitled to judgment as a matter of law, and if no dispute exists as to either the material facts or the inferences to be drawn from undisputed facts, or if resolving disputed facts would not alter the result. ACUITY v. Burd & Smith Constr., Inc., 2006 ND 187, ¶6, 721 N.W.2d 33. The party moving for summary judgment must show there are no genuine issues of material fact and the case is appropriate for judgment as a matter of law. Green v. Mid Dakota Clinic, 2004 ND 12, ¶ 5, 673 N.W.2d 257. A party resisting a motion for summary judgment cannot merely rely on the pleadings or other unsupported con-clusory allegations. Fast v. State, 2004 ND 111, ¶ 6, 680 N.W.2d 265. A resisting party must present competent admissible evidence by affidavit or other comparable means which raises an issue of material fact. Beckler v. Bismarck Pub. Sch. Dist., 2006 ND 58, ¶ 7, 711 N.W.2d 172. A district court’s decision on a motion for summary judgment is a question of law that we review de novo on the record. See Ernst v. Acuity, 2005 ND 179, ¶7, 704 N.W.2d 869.

[¶ 11] The workers’ compensation act, N.D.C.C. tit. 65, is a legislatively created compromise for claims between injured workers and their employers. Cervantes v. Drayton Foods, L.L.C. 1998 ND 138, ¶ 6, 582 N.W.2d 2. Under the workers’ compensation act, an employee generally gives up the right to sue the employer in exchange for sure and certain benefits for all workplace injuries, regardless of fault. Id. See N.D.C.C. § 65-01-01. An “employee” is “a person who performs hazardous employment for another for remuneration,” and an “employer” is “a person who engages or received the services of another for remuneration.” N.D.C.C. § 65-01-02(16) and (17). Under N.D.C.C. § 65-01-08, injured employees do not have a claim for relief against a “contributing employer or against any agent, servant, or other employee of the employer for damages for personal injuries, but shall look solely to the fund for compensation.” Section 65-04-28, N.D.C.C., provides that “[ejmploy-ers who comply with the provisions of [N.D.C.C. ch. 65-04] shall not be liable to respond in damages at common law or by statute for injury to or death of any employee.” Under N.D.C.C. § 65-05-06, “[t]he payment of compensation or other benefits by the organization to an injured employee, or to the injured employee’s dependents in case death has ensued, are in lieu of any and all claims for relief whatsoever against the employer of the injured or deceased employee.” Section 65-01-09, N.D.C.C., provides that “when an injury or death for which compensation is payable under provisions of this title shall have been sustained under circumstances creating in some person other than the organization a legal liability to pay damages in respect thereto, the injured employee, or the employee’s dependents may claim compensation under this title and proceed at law to recover damages against such other person.”

[¶ 12] In Cervantes, 1998 ND 138, ¶ 1, 582 N.W.2d 2, we construed those exclusive remedy provisions and held an employee of a company providing laborers to another business on a temporary basis was not precluded from suing the other business in tort. We construed the statutory language precluding an employee from suing a “contributing employer” in N.D.C.C. § 65-01-08 and said that language was clear and unambiguous and precluded an injured employee from bringing an action against a “contributing employer.” Cervantes, at ¶ 9. We concluded a “contributing employer” is the entity who pays the WSI premium to secure workers’ compensation coverage for the employee and, in turn, receives immunity from legal liability for injuries to the employee! Id. Although the legislature has since amended N.D.C.C. § 65-01-08 to provide that both a client company and staffing service are entitled to immunity when the workers’ compensation statutes have been met, see 2003 N.D. Sess. Laws ch. 563, § 1, Cervantes provides the basic statutory framework for analyzing the parties’ claims in this case.

[¶ 13] Here, it is undisputed Trinity Health is a “contributing employer” under workers’ compensation law and Phillips has sued a related corporation, Trinity Hospitals, for Neiss’ death. In analyzing immunity issues for related corporations, one noted commentator has said “[t]he commonest question arising out of relations between affiliated corporations and their employees is whether an employee of a wholly-owned subsidiary can sue the parent corporation, and whether an employee of the parent can sue the subsidiary.” 6 Arthur & Lex K. Larson, Larson’s Workers’ Compensation Law § 112.01 (2006). Professor Larson recognizes common ownership, identity of management, and the presence of a common insurer are not enough to create the same identity between a parent and a subsidiary for compensation purposes and the most significant factor for compensation purposes is actual control. Id. If the subsidiary is in practice not only completely owned, but completely controlled by the parent, identity may well be found and immunity conferred, and conversely, a showing of absence of control is perhaps the most effective single way to disprove the unity of a parent corporation and a subsidiary. Id.

[¶ 14] In denying Trinity Hospitals’ motion for summary judgment, the district court relied on the analysis in a Michigan Court of Appeals case, Wodogaza, 411 N.W.2d at 848. The Michigan courts have adopted an “economic reality” test for considering issues about the exclusive remedy provisions of workers’ compensation laws in the context of parent and subsidiary corporations. Wells v. Firestone Tire & Rubber Co., 421 Mich. 641, 364 N.W.2d 670, 672-73 (1984). Under the economic reality test, a court considers the following factors: (1) control of a worker’s duties; (2) payment of wages; (3) the right to hire, fire, and discipline; and (4) the performance of the duties as an integral part of the employer’s business toward the accomplishment of a common goal. Id. See also James v. Commercial Carriers, Inc., 230 Mich.App. 533, 583 N.W.2d 913, 915-16 (1998); Verhaar v. Consumers Power Co., 179 Mich.App. 506, 446 N.W.2d 299, 300 (1989); Wodogaza, 411 N.W.2d at 850. No one factor is controlling, and the economic reality test “ ‘looks to the employment situation in relation to the statutory scheme of workers’ compensation law with the goal of preserving and securing the rights and privileges of all parties.’ ” Wells, at 673 (quoting Farrell v. Dearborn Mfg. Co., 416 Mich. 267, 330 N.W.2d 397, 400 (1982)).

[¶ 15] In Wodogaza, the plaintiff was an employee of the parent corporation, Preston Trucking, and was injured when a forklift he was driving overturned because of actions of a co-worker who was driving a tractor owned by S & P Equipment, a wholly-owned subsidiary of Preston Trucking. 411 N.W.2d at 848-49. The accident occurred on premises owned by H & R Terminals, another wholly-owned subsidiary of Preston Trucking. Id. at 849. The injured plaintiff received workers’ compensation benefits from Preston Trucking and thereafter sued the two subsidiary corporations, alleging H & R Terminals was negligent in failing to properly maintain its premises and S & P Equipment incurred liability under the owner liability provision of the Michigan Vehicle Code. Id. The Michigan Court of Appeals applied the economic reality test and decided the subsidiary corporations were not immune from liability under a Michigan’s workers’ compensation law that provided the employee’s exclusive remedy against the “employer.” Id.

[¶ 16] The Wodogaza court distinguished an earlier Michigan Supreme Court case, Wells, in which an employee of a wholly-owned subsidiary corporation, Muskegon Firestone, sued the parent corporation, Firestone. 411 N.W.2d at 851-52. In Wells, the plaintiff received workers’ compensation benefits through the parent corporation and subsequently sued the same parent corporation. 364 N.W.2d at 671-72. The Michigan Supreme Court recognized the general principle that separate corporate entities would be respected unless doing so would subvert justice or cause a result that would be contrary to some other overriding public policy. Id. at 674. The court disregarded the separate corporate entities and held the parent corporation was immune from liability under the exclusive remedy provisions of workers’ compensation law, reasoning:

Our disregard of the separate corporate entities of Firestone and its wholly owned subsidiary is premised upon our recognition of the important public policies underlying the Michigan Worker’s Disability Compensation Act and our belief that a contrary determination would be inequitable under the facts of this case. The statutory workers’ compensation scheme was enacted for the protection of both employees and employers who work and do business in this state. The system assures covered employees that they will be compensated in the event of employment-related injuries. In addition, employers are assured of the parameters of their liability for such injuries. By agreeing to assume responsibility for all employment-related injuries, employers protect themselves from the possibility of potentially excessive damage awards. In order to effectuate these policies, the statute has been liberally construed to provide broad coverage for injured workers.
If the statute is to be construed liberally when an employee seeks benefits, it should not be construed differently when the employer asserts it as a defense to a tort action brought by the employee who claimed and accepted benefits arising from that employment relationship. There is absolutely no evidence that [Firestone] maintained Muskegon Firestone for the purpose of insulating itself from its workers’ compensation liabilities. [Firestone] supplied workers’ compensation benefits through its insurance company and accepted responsibility for the work related injuries of its Muskegon employees. Indeed, under the facts and circumstances of this case, we would not have permitted Firestone to shield itself behind its wholly owned subsidiary in order to avoid payment of workers’ compensation benefits to plaintiff.

Wells, 364 N.W.2d at 674-75 (citations omitted).

[¶ 17] Wodogaza distinguished Wells, recognizing that although courts generally respect the separateness of corporate entities, the equities in the cases were not the same. 411 N.W.2d at 852. In Wodogaza, the parties being sued, the subsidiaries, had not provided workers’ compensation coverage for the injured plaintiff and were seeking to shield themselves from tort liability without assuming any liability for payment of workers’ compensation benefits, while in Wells the party being sued had provided workers’ compensation coverage for the inured plaintiff. 411 N.W.2d at 852. A common thread in Wells and Wodogaza involves whether the entity being sued has provided workers’ compensation coverage for the injured plaintiff.

[¶ 18] In James, 583 N.W.2d at 916, the Michigan Court of Appeals highlighted that common thread, stating “[a] salient factor in determining an employee-employer relationship in the parent-subsidiary context is the use of a combined worker’s compensation insurance policy by both parent and subsidiary.” See also Isom v. Limitorque Corp., 193 Mich.App. 518, 484 N.W.2d 716, 717 (1992); Verhaar, 446 N.W.2d at 300. In James, the plaintiff was an employee of Fleet Carrier, a wholly-owned subsidiary of Ryder System, and alleged he was injured when an employee of Commercial Carriers, another wholly-owned subsidiary of Ryder System, struck him with a truck chassis while loading the chassis onto a delivery truck. 583 N.W.2d at 915. The plaintiff applied for workers’ compensation benefits from his employer, Fleet Carrier, and he received benefits from Ryder Automotive Operations, another wholly-owned subsidiary of Ryder System responsible for administering all workers’ compensation claims for Ryder System and its subsidiaries. Id. The plaintiff sued Commercial Carriers. Id. The Michigan Court of Appeals applied the economic reality test and concluded the plaintiffs action against Commercial Carriers was barred by the exclusive remedy provisions of Michigan’s workers’ compensation law. Id. at 918-19. The James court distinguished Wodogaza, stating Fleet Carrier and Commercial Carriers were not shell corporations and Commercial Carriers had workers’ compensation insurance under the same filing as Ryder System and Fleet Carrier, and the workers’ compensation claims were all processed through the same wholly-owned subsidiary. Id. at 918. The James court said in addition to sharing a filing for workers’ compensation self-insurer status, the subsidiaries shared numerous financial functions, there was a unity of management between the parent corporation, Ryder, and each of its subsidiaries, and there was a unity of personnel policy. Id. The court decided that under the totality of circumstances, Ryder System was the plaintiffs employer for purposes of the exclusive remedy provisions and Commercial Carriers and Fleet Carrier were such integral components of Ryder System that Commercial Carriers was entitled to the benefits of the exclusive remedy provisions. Id. at 919.

[¶ 19] We agree with the James court that a salient factor in determining an employer-employee relationship is the use of combined workers’ compensation premiums for related corporations. That factor is particularly relevant in North Dakota because N.D.C.C. § 65-01-08 specifically precludes an injured employee from bringing an action against a “contributing employer.” See Cervantes, 1998 ND 138, ¶ 9, 582 N.W.2d 2. Under North Dakota law, WSI is the entity charged with administering the policies, powers, and duties of N.D.C.C. tit. 65. See N.D.C.C. § 65-01-02(22). Here, an unrefuted affidavit of the assistant director to policyholder services at WSI provides:

2. Trinity Health pays the WSI premiums for all employees in the Trinity Health system.
3. WSI set up and determined the structure of the premiums and coverage for the employees of Trinity Health; as such, all Trinity corporations fall under one account at Workforce Safety <& Insurance for the payment of WSI premiums.
4. WSI does not consider Trinity Hospitals to be a separate entity from Trinity Health for WSI purposes; the premium payment made by Trinity Health to WSI is intended to cover all employees in the Trinity Health system.
5. WSI has determined the structure of premiums paid by Trinity Health to encompass employees working at Trinity Hospitals, in addition to all other employees in the Trinity Health integrated healthcare system.

We conclude WSI’s determination that “all Trinity corporations fall under one account” at WSI is a prominent factor in this case.

[¶ 20] Moreover, the organizational structure for Trinity Health and its related corporations is not disputed. Although Trinity Health and Trinity Hospitals are separate corporations, Trinity Hospitals is part of Trinity Health, a healthcare system consisting of four non-profit corporations: Trinity Hospitals, Trinity Homes, Trinity Kenmare Hospital, and Trinity Health Foundation. Trinity Health is the sole member of the four non-profit corporations, and Trinity Health and the four nonprofit corporations are governed by the same board of directors and by the same officers. All employees in the Trinity healthcare system are employees of Trinity Health, Trinity Health is responsible for the payroll for all employees, and there is one Human Resources Department at Trinity Health. Although a “skywalk and service tunnel access and utilities easements agreement” provided that Trinity Hospitals was responsible for the maintenance and upkeep of the service tunnel, according to Kevin Seehafer, the chief financial officer for Trinity Health and the four non-profit corporations, the director of plant operations and maintenance for Trinity Health was responsible for repairs, maintenance, and housekeeping for the properties of all four of the related nonprofit corporations. Phillips has not identified any evidence to contradict the organizational structure for Trinity Health and its related non-profit corporations or the control Trinity Health exercises over those corporations. WSI’s determination about the structure of Trinity Health’s WSI premiums, coupled with the organizational structure and relationship of Trinity Health and Trinity Hospitals, compels a conclusion that Trinity Health and Trinity Hospitals are the same entities for WSI purposes under both the “control” and the “economic reality” tests.

[¶ 21] On this record, we conclude Trinity Hospitals is the same entity as Trinity Health for WSI purposes and is entitled to the benefits of the exclusive remedy provisions as a “contributing employer” under the plain and unambiguous language of N.D.C.C. § 65-01-08. Holding otherwise would allow WSI to collect a premium for all Trinity Health employees but only provide coverage while those employees were on property owned by Trinity Health and only while those employees were doing the work of Trinity Health. This conclusion would leave the other four Trinity corporations without employees and without WSI coverage any time Trinity Health employees did work for the four wholly-owned corporations. We therefore conclude Trinity Hospitals is immune from suit under the exclusive remedy provisions of our workers’ compensation law and Trinity Hospitals’ motion for summary judgment should have been granted.

Ill

[¶ 22] We exercise our supervisory jurisdiction and direct the district court to vacate its order denying Trinity Hospitals’ motion for summary judgment and to dismiss Phillips’ action.

[¶ 23] GERALD W. VANDE WALLE, C.J., and NORMAN J. BACKES and WILLIAM F. HODNY, S.J., and DALE V. SANDSTROM, J., concur.

[¶ 24] The Honorable WILLIAM F. HODNY, S.J., and the Honorable NORMAN J. BACKES, S.J., sitting in place of KAPSNER, J., and MARING, J., disqualified.


author: MEIERHENRY, Justice.

text:
    2006 SD 93
    Collin LOESCH, Plaintiff and Appellant, v. The CITY OF HURON, A Municipal Corporation, Defendant and Appellee.
    No. 23922.
    Supreme Court of South Dakota.
    Considered on Briefs Oct. 2, 2006.
    Decided Oct. 25, 2006.
    Beverly J. Katz of Katz Law Office, Huron, South Dakota, Attorney for plaintiff and appellant.
    Robert B. Anderson of May, Adam, Gerdes and Thompson, Pierre, South Dakota, Attorneys for defendant and appel-lee.
   MEIERHENRY, Justice.

[¶ 1.] Collin Loesch (Loesch) brought suit against the City of Huron (City) after he was injured on a city street while riding his bicycle. The City brought a motion for judgment on the pleadings claiming that Loesch had failed to file suit within the two year statute of limitations in SDCL 9-24-5. Loesch claimed that SDCL 3-21-2, which requires an injured party to give notice to a city, and SDCL 3-21-6, which allows a city ninety days to respond, tolled the two year statute of limitations. The trial court ruled against Loesch and dismissed the lawsuit. The trial court also dismissed Loesch’s claim of nuisance. We affirm dismissal of the nuisance claim, reverse dismissal as to the statute of limitations and remand for trial.

PROCEDURAL BACKGROUND

[¶ 2.] In his pleadings, Loesch claimed that on May 2, 2003, he fell and was injured while riding his bicycle on a City street. He claimed that the City was negligent in not marking the area of the street where it was making repairs and that the City’s negligence caused his injuries. On September 2, 2003, Loesch provided written notice to the City, indicating the time, place, and cause of his injury as required by SDCL 3-21-2 and waited for the City to respond. Ninety days passed without reply from the City. Loesch subsequently served a summons and complaint on June 27, 2005. The City filed a motion for judgment on the pleadings based on Loeseh’s failure to commence his personal injury action against the City within two years of the occurrence as required by SDCL 9-24-5. The trial court granted the City’s motion, concluding that neither SDCL 3-21-2 nor 3-21-6 stayed the two-year statute of limitations. Loesch appeals and raises the following issues:

ISSUES

1. Whether the trial court erred by not excluding the ninety day time frame between Loesch’s notice to the City and the City’s failure to reply, and in so doing erred in dismissing Loesch’s lawsuit based upon the two year statute of limitations in SDCL 9-24-5.
2. Whether the trial court erred in dismissing Loesch’s nuisance claims against the City.

STANDARD OF REVIEW

[¶3.] “Judgment on the pleadings provides an expeditious remedy to test the legal sufficiency, substance, and form of the pleadings.” M.S. v. Dinkytown Day Care Center, Inc., 485 N.W.2d 587, 588 (S.D.1992) (internal quotations omitted). It is only an appropriate remedy to resolve issues of law when there are no disputed facts. Id. Loesch’s arguments relate solely to whether the trial court erred in finding that his action was time barred by South Dakota law. A question of statutory interpretation is a question of law which we review de novo. State v. $1,010.00 in American Currency, 2006 SD 84, ¶ 8, 722 N.W.2d 92, 94.

DECISION

Statute of Limitations

[¶ 4.] Loesch’s first issue is that the trial court erred in concluding his negligence action was barred because it was not brought within the two year statute of limitations specified in SDCL 9-24-5. The statute provides as follows:

Any action for recovery of damages for personal injury or death caused by the negligence of a municipality must be commenced within two years from the occurrence of the accident causing the injury or death.

SDCL 9-24-5. The statute sets forth an “occurrence rule” statute of limitations, which means a cause of action accrues at the time the injury occurs. See Burgard v. Benedictine Living Communities, 2004 SD 58, ¶ 17, 680 N.W.2d 296, 301; Green v. Siegel, Barnett, and Schütz, 1996 SD 146, ¶ 10, 557 N.W.2d 396, 399. Since this is an occurrence rule, any argument by Loesch concerning delayed accrual is without merit.

[¶ 5.] In this case, the statute of limitations began to run when Loesch was injured on May 2, 2003. Loesch argues that the notice provisions in SDCL 3-21-6 and 3-21-2 prohibited him from maintaining a lawsuit against the City for a period of time and tolled the two year statute of limitations. The statutory notice provisions first require that before commencing a court action, a claimant must give notice to the public entity within 180 days of the occurrence. SDCL 3-21-2. The statute mandates the following:

No action for the recovery of damages for personal injury, property damage, error, or omission or death caused by a public entity or its employees may be maintained against the public entity or its employees unless written notice of the time, place, and cause of the injury is given to the public entity as provided by this chapter within one hundred eighty days after the injury.

SDCL 3-21-2.

[¶ 6.] Additionally after receiving notice, the public entity has ninety days to accept or reject the claim before the claimant can file a lawsuit. SDCL 3-21-6. The statute provides:

The claimant or the claimant’s legal representative may file a suit if the public entity does not accept or reject the claim within ninety days of receipt of the notice as provided in § 3-21-2.

SDCL 3-21-6. Loesch argues that these statutes toll or suspend the two year statute of limitations in SDCL 9-24-5 for the period of time that (1) the city responds to the claim or (2) ninety days has passed from the date of the notice of the claim.

[¶ 7.] The plain and ordinary language of the statutes supports Loesch’s interpretation. Although we have examined the mandatory notice requirements of the statutes, we have not had occasion to address whether the mandatory notice and reply time frames toll the statute of the limitations. See Gakin v. City of Rapid City, 2005 SD 68, ¶ 15, 698 N.W.2d 493, 498; Purdy v. Fleming, 2002 SD 156, ¶ 14, 655 N.W.2d 424, 429-30; Peterson, ex rel. Peterson v. Burns, 2001 SD 126, ¶ 39, 635 N.W.2d 556, 570 (stating that SDCL 3-21-2 is an example of a notice statute in which a plaintiff must give 180 days notice after the time of the injury); In re Kindle, 509 N.W.2d 278, 280 (S.D.1993) (stating that “[ujnder South Dakota law, no action for damages may be maintained against a public entity or official unless written notice of the injury is given to that entity within 180 days of the injury”); Finck v. City of Tea, 443 N.W.2d 632, 635 (S.D.1989) (holding that notice of tort claim to mayor or city finance officer is mandatory). Additionally in the context of analyzing “substantial compliance,” we acknowledged the legislative objectives for the notice requirement to public entities as follows:

To investigate evidence while fresh; (2) to prepare a defense in case litigation appears necessary; (3) to evaluate claims, allowing early settlement of meritorious ones; (4) to protect against unreasonable or nuisance claims; (5) to facilitate prompt repairs, avoiding further injuries; (6) to allow the [public entity] to budget for payment of claims; and (7) to insure that officials responsible for the above tasks are aware of their duty to act.

Myears v. Charles Mix County, 1997 SD 89, ¶ 13, 566 N.W.2d 470, 474 (internal quotations omitted).

[¶ 8.] To determine whether the legislature intended the notice provision of SDCL 3-21-2 and the mandatory response time frames in SDCL 3-21-6 to toll the two-year statute of limitations, we first examine the statute as a whole and the plain, ordinary, and popular meaning of its language. State v. Ducheneaux, 2003 SD 131, ¶ 9, 671 N.W.2d 841, 843. We have said, “[sjince statutes must be construed according to their intent, the intent must be determined from the statute as a whole, as well as enactments relating to the same subject.” Dahn v. Trownsell, 1998 SD 36, ¶ 14, 576 N.W.2d 535, 539 (quoting Moss v. Guttormson, 1996 SD 76, ¶ 10, 551 N.W.2d 14, 17) (reversed on other grounds). Both SDCL 3-21-2 and 3-21-6 were enacted in the 1986 Legislative Session as provisions in the same bill. S.D. Laws 1986 ch. 4 § 6. In addition, a previously passed statutory provision codified in SDCL 15-2-25 specifically provided that “[w]hen the commencement of an action is stayed by ... statutory prohibition, the time of the ... prohibition is not part of the time limited for the commencement of the action.” In determining legislative intent, we also take into consideration prior enacted statutes on the same subject matter and read the statutes in pari materia. We have recognized:

The object of the rule of pari materia is to ascertain and carry into effect the intention of the legislature. It proceeds upon the supposition that the several statutes were governed by one spirit and policy, and were intended to be consistent and harmonious in their several parts and provisions.
For purposes of determining legislative intent, we must assume that the legislature in enacting a provision has in mind previously enacted statutes relating to the same subject matter. As a result, the provision should be read, if possible, in accord with the legislative policy embodied in those prior statutes.

State v. Chaney, 261 N.W.2d 674, 676 (S.D.1978) (internal quotations omitted) (citations omitted).

[¶ 9.] Here, we must assume that when the legislature adopted SDCL 21-3-2 and 21-3-6, the legislature had in mind the previously enacted SDCL 15-2-25. Therefore, since the legislature set forth prohibitions against commencing an action against a city until a city has notice and time to reply, it necessarily follows that the legislature intended SDCL 15-2-25 also to apply and that the “time of the prohibition” was to be excluded from the two year statute of limitations.

[¶ 10.] Other jurisdictions, which have interpreted statutes similar to SDCL 15-2-25, have reached similar conclusions. For example, the Supreme Court of Wisconsin analyzed a statute identical to SDCL 15-2-25 both in relation to the requirement that a city be given notice of a personal injury claim and in relation to the requirement that the city be given 120 days to accept or reject a claim. Colby v. Columbia Co., 202 Wis.2d 342, 550 N.W.2d 124, 127-28 (Wis.1996) (analyzing Wis Stat 893.23). The court held that the 120-day period should be excluded from the statute of limitations. Id. at 131. The court noted that although extending the statute of limitations frustrated the purpose of such statutes in ensuring prompt litigation, the solution to the conflict was “a matter reserved to the province of the legislature.” Id.

[¶ 11.] Similarly, the California Supreme Court also excluded the period of time where a claimant is statutorily prohibited from commencing an action from the statute of limitations. California’s Civil Code, which South Dakota adopted, contains Cal Civ PROC § 356, a provision identical to SDCL 15-2-25. The California Supreme Court held that § 356 suspends the running of the statute of limitations and noted that “[i]t is well recognized that the running of the statute of limitations is suspended during any period in which the plaintiff is legally prevented from taking action to protect his rights.” Dillon v. Bd. of Pension Comm’rs, 18 Cal.2d 427, 116 P.2d 37, 39 (1941).

[¶ 12.] Thus, the statutes prohibited Loesch from commencing his cause of action against the City from the time he gave notice under SDCL 3-21-2 until the City responded or until ninety days had passed. The City failed to respond within the ninety days. Consequently, the statute of limitations was tolled from the time Loesch gave notice to the City until the passage of ninety days. Accordingly, Loesch had until August 1, 2005, to file suit against the City. Thus, the trial court erred in granting the City’s motion for judgment on the pleadings.

Nuisance

[¶ 13.] Loesch also argues that the trial court erred in dismissing his nuisance claim because the trial court found that the City maintained the road under statutory authority. Statutorily authorized actions or maintenance are specifically exempt from being considered a nuisance under SDCL 21-10-2. The statute provides: “Nothing which is done or maintained under the express authority of a statute can be deemed a nuisance.” SDCL 21-10-2. Because the City was repairing and maintaining the road pursuant to a statutory obligation, the trial court did not err in concluding that the City’s acts did not constitute a nuisance. See Krier v. Dell Rapids Twp., 2006 SD 10, ¶ 19, 709 N.W.2d 841, 846; Hedel-Ostrowski v. City of Spearfish, 2004 SD 55, ¶13, 679 N.W.2d 491, 497.

[¶ 14.] We affirm in part, reverse in part and remand for further proceedings consistent with this opinion.

[¶ 15.] GILBERTSON, Chief Justice, and SABERS, KONENKAMP, and ZINTER, Justices, concur.

      . See California Cigarette Concessions, Inc. v. City of Los Angeles, 53 Cal.2d 865, 3 Cal.Rptr. 675, 350 P.2d 715 (1960); Dillon v. Board of Pension Comm’rs, 18 Cal.2d 427, 116 P.2d 37 (1941); City of Atlanta v. Truitt, 55 Ga.App. 365, 190 S.E. 369 (1937); Unadilla v. Felder, 145 Ga. 440, 89 S.E. 423 (1916); Woodcrest Const. Co. v. City of New York, 185 Misc. 18, 57 N.Y.S.2d 498 (1945); Amex Asphalt Corp. v. City of New York, 263 A.D. 968, 33 N.Y.S.2d 182 (N.Y.App.Div.1942); Brehm v. City of New York, 104 N.Y. 186, 10 N.E. 158 (1887); Colby v. Columbia County, 202 Wis.2d 342, 550 N.W.2d 124 (1996).

      . The Wisconsin Supreme Court reviewed the developed body of New York case law in this area. New York’s statutory framework includes NY CPLR Law § 204(a), a statute almost identical to SDCL 15-2-25. See NY CPLR Law § 204(a) (McKinney 2006). After the New York Court of Appeals determined that the statute prohibited the commencement of an action until the city had rejected the claim, the court excluded the three month period from the statute of limitations. Mulligan v. Westchester County, 272 A.D. 1023, 71 N.Y.S.2d 153 (N.Y.App.Div.1947).
      The New York Court of Appeal’s interpretation of § 204(a) resulted in varying periods of limitations for claimants bringing actions against various quasi-governmental entities. Colby, 550 N.W.2d at 130. Consequently, the New York legislature sought to create uniformity by enacting a uniform statute of limitations for all tort actions against cities, counties, towns, villages, fire districts, and school districts. See N.Y. Gen Mun Law § 50-i (McKinney 2006). In addition, the legislature also specifically provided that neither the notice requirement nor the three month waiting period would operate to extend the statute of limitations period. See id.