This opinion will be unpublished and

may not be cited except as provided by

Minn. Stat. § 480A.08, subd. 3 (2006).






Nick Egge, et al.,





Depositors Insurance Company,

an Iowa Insurance Company

licensed to do business in the

State of Minnesota,



Filed September 18, 2007

Reversed and remanded
Klaphake, Judge



Crow Wing County District Court

File No. C3-06-2357

Meeker County District Court

File No. 47-CV-06-660


John E. Mack, Mack & Daby, PA, 26 Main Street, P.O. Box 302, New London, MN 56273  (for appellants)


Thomas J. Evenson, Jon A. Hanson, Hanson Lulic & Krall, LLC, 700 Northstar East, 608 Second Avenue South, Minneapolis, MN 55402 (for respondent)


            Considered and decided by Lansing, Presiding Judge, Klaphake, Judge, and Muehlberg, Judge.*

U N P U B L I S H E D   O P I N I O N


            Appellants Nick Egge and Chanda Egge challenge the district court’s dismissal of their action against respondent Depositors Insurance Company, an Iowa insurer.  Respondent insured appellants’ home, which was destroyed by two fires on May 24, 2004.  On March 2, 2006, respondent denied appellants’ claim for failure to cooperate.  On May 17, 2006, appellants attempted substitute service on respondent pursuant to Minn. Stat. § 45.028 (2004); respondent moved to dismiss based on improper service and for a change of venue from Meeker County to Crow Wing County, the site of the fires.  On June 22, 2006, before respondent’s motion could be heard, appellants served respondent personally.  Again, respondent challenged the service, arguing that it now was beyond the contractual limitations period of two years.  Ultimately, the Meeker County District Court ruled that the substitute service was improper, and on a motion under Minn. R. Civ. P. 12.02, the Crow Wing County District Court held that appellants’ claim was time-barred as beyond the contractual limitations period.

            Because appellants’ attempted substitute service was ineffective, we affirm the order of the Meeker County District Court.  But because appellant Chanda Egge’s chapter 7 bankruptcy action may have tolled the contractual limitations period, we reverse the order of the Crow Wing County District Court and remand this matter for further proceedings.


            Sufficiency of Process under Minn. Stat. § 45.028 (2004)       

            This court reviews the sufficiency of service of process as a question of law subject to de novo review.  Turek v. A.S.P. of Moorhead, Inc., 618 N.W.2d 609, 611 (Minn. App. 2000), review denied (Minn. Jan. 26, 2001).  Service of process made in a manner not specifically authorized is generally conceded to be ineffective.  Id.  In the case of substitute service permitted by various statutes, Minnesota courts strictly construe the jurisdictional requirements and have held that failure to comply with the specific mandates of the statutes renders the substitute service invalid.  Wood v. Martin, 328 N.W.2d 723, 726 (Minn. 1983) (holding that service in the name of the decedent rather than his executor was ineffective, when service was made pursuant to Minn. Stat. § 170.55); Schuett v. Powers, 288 Minn. 542, 543-44, 180 N.W.2d 253, 254 (1970) (holding substitute service and service by publication ineffective for failure to cite jurisdictional facts, by failing to comply with filing requirements or to recite that defendants had left the state with intent to defraud or avoid service or creditors); Allstate Ins. Co. v. Allen, 590 N.W.2d 820, 822 (Minn. App. 1999) (stating that “[p]rovisions of a statute relating to the filing and service of notice must be strictly followed if a court is to acquire jurisdiction”).

            Minn. Stat. § 45.028, subd. 1, appoints the commissioner of commerce to receive service of process made on any person, including a nonresident, who violates statutory chapters 45-83, 155A, 309, or 332, or section 326.83, and who has not consented to service under those chapters.  In all other cases involving those chapters, or those cases in which service on the commissioner is permitted, Minn. Stat. § 45.028, subd. 2, permits service of process by leaving a copy of the process with the commissioner or sending a copy by certified mail.  Process served in this manner is not effective until the commissioner sends notice of the service and a copy of the process by certified mail, and the plaintiff files an affidavit of compliance on or before the return day of the process.   Id.

            The Meeker County District Court ruled that appellants failed to include the necessary jurisdictional statements to effect process in this manner, because they alleged only in a general way that respondent had breached the insurance contract and did not identify which of the statutes cited in Minn. Stat. § 45.028 served as a basis for permitting substitute service.  The record also does not reflect whether or not respondent consented to service on the commissioner.  Service procedures are to be clear and definite, in order to avoid confusion and uncertainty.  Wood, 328 N.W.2d at 726.  Based on the record before us, we conclude that the district court did not err by dismissing appellants’ complaint for insufficient service of process.

            Tolling of Contractual Limitations during Bankruptcy

            The district court obtains jurisdiction over a defendant when a case is commenced by service of a summons and complaint.  Mercer v. Andersen, 715 N.W.2d 114, 118 (Minn. App. 2006). When service is ineffective, the court lacks personal jurisdiction over a defendant.  Id. 

            Although the effect of a statute of limitations or a contractual limitations period is an issue separate from the lack of personal jurisdiction because of ineffective service, the two doctrines are somewhat interrelated.  See Mercer, 715 N.W.2d at 119.  “Statutes of limitations are both procedural and substantive because they regulate when a party may file a lawsuit and when a lawsuit is barred.”  Id.  A summons served after the limitations period has run, even if personally served, cannot confer jurisdiction because the suit is time-barred.  See Johnson v. Husebye, 469 N.W.2d 742, 745 (Minn. App. 1991), review denied (Minn. Aug. 2. 1991). 

            Appellants’ argument that the June 22, 2006 personal service should relate back to the original attempted service on May 17, 2006, is without merit.  But on October 12, 2005, appellant Chanda Egge filed a chapter 7 bankruptcy petition, which included the insurance claim as non-liquidated personal property entitled to exemption.

            Minn. Stat. § 541.15(a)(4) (2004) provides that the period of limitations is suspended when the beginning of the action is stayed by injunction or by statutory prohibition.  Appellants argue that according to 11 U.S.C.A § 362 (West 2004), a petition in bankruptcy operates to stay all claims during the pendency of the bankruptcy action, and that this is a statutory prohibition that tolls the limitations period under Minn. Stat. § 541.15(a)(4).

            Generally, section 362 has been interpreted as staying actions brought against the debtor, rather than actions commenced by the debtor.  See Victor Foods, Inc. v. Crossroads Econ. Dev., 977 F.2d. 1224, 1227 (8th Cir. 1992).  But appellant Chanda Egge, as debtor, was not permitted to initiate an action; once property or an interest in property is made a part of the bankruptcy estate, the trustee alone has the power to initiate actions or claims on behalf of the bankruptcy estate.  11 U.S.C.A. § 541 (West 2004).  In addition, once a bankruptcy petition is filed, all interested parties, including the debtor, trustee, and creditors, are given at least 20 days’ notice of the meeting of creditors.  Fed. R. Bankr. P. 2002(a).  The meeting of the creditors must occur “[w]ithin a reasonable time after the order for relief,” a time deliberately indefinite.  11 U.S.C.A. § 341(a) (West 2004); see also In re Brown Transp. Truckload, Inc., 161 B.R. 735, 738 (Bankr. N.D. Ga. 1993).  Until the debtor appears at the meeting of creditors and submits to an examination, only limited action can occur, because the examination of the debtor serves to develop the facts and circumstances that bear on the question of discharge.  See 11 U.S.C.A. § 343 (West 2004); Sigman v. United States, 320 F.2d 176, 178 (9th Cir. 1963). 

            During this period of time, between filing of the bankruptcy petition and meeting of the creditors, the debtor may not pursue a claim and the trustee’s actions are constrained by the notice requirements.  In effect, this may operate as a statutory prohibition within the meaning of Minn. Stat. § 541.15(a)(4), tolling the limitations period.

            Given the short period of time between the end of the contractual limitations period on May 17, 2006, and the personal service accomplished on June 22, 2006, a period of 29 days, and the lack of information in the record about the length of time between filing of the bankruptcy petition and the meeting of creditors, and what consideration, if any, the trustee gave to this claim, we conclude that the Crow Wing County District Court erred by dismissing appellants’ complaint under Minn. R. Civ. P. 12.02 as beyond the contractual limitations period.  We therefore remand this matter to the district court for further proceedings.

            Appellants also argue that in any event an equitable tolling of the limitations period should apply.  A court may grant equitable relief by tolling a limitations period.  Jones v. Consol. Freightways Corp., 364 N.W.2d 426, 429 (Minn. App. 1985).  Generally, “innocent inadvertence” is not sufficient to toll a statute, but circumstances beyond the control of the plaintiff can provide a basis for equitable tolling.  Id.; State by Khalifa v. Russell Dieter Enters., Inc., 418 N.W.2d 202, 206 (Minn. App. 1988).  While the court must consider whether the defendant was prejudiced, the conduct of the plaintiff is also subject to scrutiny.  See Ochs v. Streater, Inc. 568 N.W.2d 858, 860 (Minn. App. 1997).  Equitable tolling of a limitations period is not appropriate when no circumstances beyond the plaintiff’s control prohibit service of a complaint within the statutory period.  Id.  Here, appellants had two years within which to serve respondent; the bankruptcy case lasted only four months, and two months of the limitation period remained after Chanda Egge’s discharge from bankruptcy.  In addition, Chanda Egge voluntarily petitioned for bankruptcy, an action within her control.  The circumstances here do not support equitable tolling of the limitations period.

            Reversed and remanded.


* Retired judge of the district court, serving as judge of the Minnesota Court of Appeals by appointment pursuant to Minn. Const. art. VI, § 10.