Gilbreath v. Brewster

Present: All the Justices

CLARENCE C. GILBREATH, ET AL.

v. Record No. 950178 OPINION BY JUSTICE ELIZABETH B. LACY
November 3, 1995
PAMELA J. BREWSTER, ET AL.

FROM THE CIRCUIT COURT OF ARLINGTON COUNTY
Paul F. Sheridan, Judge

The primary issue in this appeal is whether the dismissal

of an action pursuant to Supreme Court Rule 3:3 for lack of

timely service is with or without prejudice.
The relevant facts are undisputed. On July 11, 1991, a

traffic accident occurred involving two vehicles, one driven by

Pamela J. Brewster and the other driven by Clarence C.

Gilbreath, an employee of Wells Cargo, Inc. On July 9, 1993,

Brewster and Victoria Ann Brann, a passenger in the Brewster

vehicle, filed separate motions for judgment against Gilbreath

and Wells Cargo alleging that Gilbreath's negligence caused the

accident and seeking recovery for personal injuries allegedly

sustained in the accident. Service was obtained on both

defendants approximately 13 months after the actions were

filed.

Gilbreath and Wells Cargo (collectively "Gilbreath") filed

responsive pleadings, asserted a counterclaim for property

damage in the action filed by Brewster, and asserted a third-

party claim for contribution against Brewster in the action

filed by Brann. In addition, Gilbreath filed motions to

dismiss in both cases for failure to effect service within one

year after commencement of the action pursuant to Rule 3:3.
 The trial court heard the two actions together. At the

hearing on the motions to dismiss, Brewster and Brann requested

nonsuits. The trial court determined that Brewster and Brann

had not exercised due diligence in trying to effect service,

but granted their motions for nonsuits. Gilbreath filed a

motion for reconsideration, arguing that Brewster and Brann

were not entitled to nonsuits as a matter of right under Code

§ 8.01-380 because Gilbreath's counterclaim and third-party

claim could not be independently adjudicated. The trial court

agreed and vacated the nonsuit orders. The trial court then

granted Gilbreath's motions to dismiss pursuant to Rule 3:3 and

entered orders dismissing the actions without prejudice.
Gilbreath appealed the judgments, asserting that dismissal

of an action pursuant to Rule 3:3 should be with prejudice.

Brewster and Brann assigned cross-error asserting that they

were entitled to nonsuit their actions and the trial court

erred in vacating its orders granting the nonsuits. The cases

were consolidated for appeal.

Rule 3:3

Rule 3:3 provides in pertinent part:
No judgment shall be entered against a defendant
who was served with process more than one year after
the commencement of the action against him unless the
court finds as a fact that the plaintiff exercised
due diligence to have timely service on him.

We have not previously addressed whether this Rule requires

that dismissal be with prejudice when service on the defendant

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is not perfected within one year and the trial court finds a

lack of due diligence by the plaintiff. 1 Brewster and Brann

(collectively "Brewster") argue that the dismissal under Rule

3:3 must be without prejudice for two reasons: (1) the

dismissal is not based on the merits of the claim; and (2) a

dismissal with prejudice would conflict with Code § 8.01-

229(E)(1), and therefore, the statute must prevail. Clark v.

Butler Aviation, 238 Va. 506, 511, 385 S.E.2d 847, 850 (1989).

These arguments are not well taken, however.
First, contrary to Brewster's assertion, not all

dismissals terminating a cause of action without determining

the merits are dismissals without prejudice. A dismissal based

on a plea in bar, such as a plea of sovereign immunity, is a

dismissal with prejudice. In these circumstances, the ability

of a plaintiff to pursue a claim against the defendant is

finally determined, although not on the merits of the

plaintiff's claim against the defendant. Therefore, a

1
In Dennis v. Jones, 240 Va. 12, 393 S.E.2d 390 (1990), we
held that the plaintiff did not exercise due diligence in his
attempts to secure service on the defendant and that the
defendant was not served within the one year period. While we
directed that the dismissal under Rule 3:3 be with prejudice,
id. at 20, 393 S.E.2d at 394, the nature of the dismissal, the
issue in this case, was not an issue in Dennis.
Similarly, in Strickland v. Simpkins, 221 Va. 730, 273
S.E.2d 539 (1981), the plaintiff asserted that a dismissal under
Rule 3:3 was without prejudice and qualified for the tolling
provisions of the then recently enacted Code § 8.01-229(E)(1).
The court did not address the issue because it concluded that
Code § 8.01-229(E)(1) did not apply under the circumstances of
that case.

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dismissal under Rule 3:3 is not precluded from being a

dismissal with prejudice even though the merits of the

plaintiff's claim were not determined.

We also reject Brewster's second premise, that a dismissal

with prejudice conflicts with Code § 8.01-229(E)(1). That Code

section contains tolling provisions which allow an action,

previously terminated "without determining the merits," to

avoid a second dismissal based on a plea of the statute of

limitations. The statute applies, however, only when the claim

can be refiled following a dismissal. It is the nature of the

prior dismissal which determines whether the action remains

viable.
A dismissal with prejudice generally is "as conclusive of

the rights of the parties as if the suit had been prosecuted to

a final disposition adverse to the plaintiff," and it not only

terminates the particular action, "but also the right of action

upon which it is based." Virginia Concrete Co. v. Board of
Supervisors, 197 Va. 821, 825, 91 S.E.2d 415, 418 (1956). See

also Reed v. Liverman, 250 Va. 97, 100, 458 S.E.2d 446, 447

(1995). For example, as discussed above, a dismissal with

prejudice on the basis of a plea in bar, is conclusive as to

the rights of those parties, even though the substantive claim

of the plaintiff has not been litigated on the merits. Thus,

for purposes of Code § 8.01-229(E)(1), a dismissal with

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prejudice is a determination on the merits. 2 The claim in that

situation is no longer viable and the plaintiff does not have a

right to the tolling provisions of Code § 8.01-229(E)(1). A

dismissal with prejudice affects only the viability of the

claim, its ability to be litigated on the merits. Therefore, a

dismissal with prejudice does not conflict with Code § 8.01-

229(E)(1).

Clark v. Butler, relied on by Brewster, does not affect

the above analysis. Clark involved the interplay between Rule

3:3 and the nonsuit statutes. That statutory scheme is

significantly different from the single statute under

consideration here. In Clark, failure to comply with Rule 3:3

was raised in the first action, but a nonsuit was requested and

granted. The claim was refiled and the Rule 3:3 violation in

the first action was again asserted as a basis for dismissal.

238 Va. at 508, 385 S.E.2d at 847. This Court held that a

violation of Rule 3:3 in the original action could not be used

to bar prosecution of the refiled action and, therefore, no

conflict existed between the Rule and the statutes in issue.
Id. at 511-12, 385 S.E.2d at 849-50. Nothing in the holding of

Clark suggests that a conflict would exist between a case

terminated with prejudice, although not resolved on the merits,

2
A dismissal with prejudice may not always operate as a res
judicata bar to a subsequent action, Virginia Concrete, 197 Va.
at 825, 91 S.E.2d at 418, but these exceptions are not relevant
in this case.

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and Code § 8.01-229(E)(1).

Having determined that the arguments presented by Brewster

do not require that a dismissal under Rule 3:3 be without

prejudice, we turn to our original consideration -- whether a

dismissal under Rule 3:3 is with or without prejudice.

The Rule itself is silent; however, to allow dismissal

without prejudice renders the Rule ineffective. The purpose of

Rule 3:3 is to provide for timely prosecution of lawsuits and

to avoid abuse of the judicial system. If a dismissal under

the Rule were without prejudice, a litigant could repeatedly

file an action without serious attempt to serve the defendant.

This practice clearly would be an abuse of the system. To

sanction this abuse would be particularly offensive because

dismissal under the Rule requires a determination that the

plaintiff did not use due diligence in attempting to secure

service on the defendant. A dismissal without prejudice under

these circumstances would condone the plaintiff's lack of

diligent prosecution.
Furthermore, if dismissal under Rule 3:3 were without

prejudice, the tolling provisions of Code § 8.01-229(E)(1)

could be invoked, allowing repeated filings which effectively

nullify the statute of limitations and potentially allow

harassment of the defendant. See W. Hamilton Bryson, Handbook

on Virginia Civil Procedure, at 99-100 (2d ed. 1989); Leigh B.

Middleditch, Jr. & Kent Sinclair, Virginia Civil Procedure

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§ 7.12, at 375-79 (2d ed. 1992). If a plaintiff who has

suffered a dismissal for failure to comply with Rule 3:3

retains the right to refile the cause of action against the

previously unserved defendant, both the purpose of Rule 3:3 and

the statute of limitations are undermined.

Accordingly, we conclude that a dismissal under Rule 3:3

is a dismissal with prejudice and the trial court erred in

dismissing Brewster's and Brann's actions without prejudice. 3

CROSS-ERROR

Code § 8.01-380 gives a plaintiff a statutory right to one

nonsuit even if a counterclaim or third-party claim is pending,

if those claims can be independently adjudicated. Brewster

asserts that Gilbreath's counterclaim was in effect a "nullity"

and that the third-party claim could be independently litigated

and, therefore, the trial court erred in vacating its orders

granting nonsuits in the personal injury actions. We disagree.

Rule 3:8 allows a defendant to plead as a counterclaim any

claim, regardless of whether it relates to the original

transaction and irrespective of the amount claimed. Although

the amount of the counterclaim here was only $50, an amount

which, in an independent suit, would place the claim

3
We note that in 1994, the General Assembly enacted Code
§ 8.01-275.1, which codifies the one year service provision of
Rule 3:3. This Code section, like the Rule, does not address
the effect of the dismissal. That statute is not at issue in
this case.

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exclusively within the general district court's jurisdiction,

Code § 16.1-77, the counterclaim was not a nullity as argued by

Brewster. Furthermore, resolution of this claim would require

determination of Brewster's liability for the accident. Thus,

Gilbreath's claim could not be independently adjudicated

because "adjudication of one claim would be an adjudication of

both." Lee Gardens Arlington Limited Partnership v. Arlington

County Board, 250 Va. ___, ___ S.E.2d ___ (1995), decided

today.
Finally, Brewster argues that prohibiting the nonsuit

because of the existence of a third-party claim "works an

absurdity" because, due to the derivative nature of a third-

party claim, the defendant cannot be prejudiced if the

plaintiff takes a nonsuit. This argument is directly

contradicted by express language in Code § 8.01-380(C), which

refers specifically to third-party claims. There is no

question that a third-party claim is a derivative claim and as

such it cannot be adjudicated independently. Therefore, the

clear intent of the General Assembly was to prevent a plaintiff

from taking a nonsuit without the defendant's consent if a

third-party claim is pending.

In summary, Gilbreath's counterclaim was not a nullity and

could not be independently adjudicated. Similarly, the third-

party claim could not be independently adjudicated. In the

absence of Gilbreath's consent to a nonsuit, the trial court

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did not err in vacating its orders of nonsuit.

Accordingly, we will affirm those portions of the trial

court's orders vacating its previous orders granting nonsuits.

We will reverse those portions of the trial court's orders

dismissing Brewster's and Brann's personal injury actions

without prejudice and enter judgment dismissing the actions

with prejudice.
Affirmed in part,
reversed in part,
and final judgment.

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