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Action Collection Service, Inc., An Idaho Corporation v. Matthew Haught and Emily Clegg

August 14, 2008

ACTION COLLECTION SERVICE, INC., AN IDAHO CORPORATION, PLAINTIFF,
v.
MATTHEW HAUGHT AND EMILY CLEGG, DEFENDANTS-THIRD PARTY PLAINTIFFS- RESPONDENTS, AND CHAPMAN ENTERPRISES, INC. DBA CHAPMAN PROPERTIES, THIRD PARTY DEFENDANT-APPELLANT.
ACTION COLLECTION SERVICE, INC., AN IDAHO CORPORATION, PLAINTIFF-APPELLANT,
v.
MATTHEW HAUGHT AND EMILY CLEGG, DEFENDANTS-THIRD PARTY PLAINTIFFS- RESPONDENTS, AND CHAPMAN ENTERPRISES, INC., DBA CHAPMAN PROPERTIES, THIRD PARTY DEFENDANT.



Appeal from the District Court of the Fourth Judicial District, State of Idaho, Ada County. Hon. D. Duff McKee, District Judge. Hon. Roy C. Holloway, Magistrate.

The opinion of the court was delivered by: Gutierrez, Chief Judge

2008 Opinion No. 79

Stephen W. Kenyon, Clerk

Order of the district court reinstating third-party complaint, reversed and case remanded.

In these consolidated appeals, Action Collection Service, Inc., and Chapman Enterprises, Inc., appeal from the district court's order reinstating the third-party complaint filed against Chapman Enterprises, Inc. We reverse and remand.

I. BACKGROUND

Matthew Haught and Emily Clegg entered into a rental agreement with Chapman Enterprises, Inc. (Chapman) for the lease of a residential property in Boise. Haught and Clegg informed Chapman of their intent to vacate the property following the end of the lease. Because their accrued rent was not paid in full, Chapman assigned their account to Action Collection Service, Inc. (Action). After several unsuccessful attempts to resolve the account, Action filed a complaint against Haught and Clegg to collect the outstanding debt arising from the rental agreement. Haught and Clegg answered, asserting Chapman's failure to return their security deposit as required by Idaho Code § 6-321 as an affirmative defense and claiming a set-off. The following day, Haught and Clegg filed a third-party complaint against Chapman, alleging a violation of I.C. § 6-321 and seeking treble damages pursuant to I.C. § 6-317.*fn1 Haught and Clegg subsequently moved to join Chapman as a plaintiff in the suit brought by Action pursuant to Idaho Rule of Civil Procedure 19. Chapman answered the third-party complaint, challenging Haught and Clegg's standing to bring the claim without first providing three days' notice as required by I.C. § 6-320(d), and moved to dismiss the complaint with prejudice.

The magistrate dismissed Haught and Clegg's third-party complaint for failure to comply with the three-day notice provision of I.C. § 6-320(d). The magistrate rejected Haught and Clegg's contention that Young v. Scott, 108 Idaho 506, 700 P.2d 128 (Ct. App. 1985), eliminated the notice requirement for their claim. Haught and Clegg appealed to the district court, which reversed the magistrate's order of dismissal on the theory that the third-party complaint was actually a counterclaim, which did not "commence an action" and was therefore exempt from the notice requirement. Action and Chapman now appeal.

II. DISCUSSION

On review of a decision of the district court, rendered in its appellate capacity, we review the decision of the district court directly. Losser v. Bradstreet, ___ Idaho ___, 183 P.3d 758, 760 (2008). We review the magistrate's findings to determine whether they are supported by substantial and competent evidence. Id.

Action and Chapman together claim three reasons why the district court erred in reversing the magistrate's dismissal of the third-party complaint. First, Action argues that Haught and Clegg's claim against Chapman is moot because the security deposit has been refunded. Chapman, agreeing with this proposition, also contends that the third-party complaint was invalid because of Haught and Clegg's failure to verify it prior to filing. Third, both Action and Chapman assert that Young v. Scott does not control the outcome of this case and that notice was required pursuant to I.C. § 6-320(d) before Haught and Clegg could properly file their third-party complaint.

A. Mootness and the Verified Complaint

Action asserts that Haught and Clegg served the required notice on Chapman after the magistrate's dismissal. Chapman forthwith complied with the statutory requirements of I.C. § 6- 321 by returning the security deposit to Haught and Clegg within the three days specified in I.C. § 6-320(d). Therefore, it is argued that Haught and Clegg have no basis on which to proceed with their third-party complaint as the security deposit issue is now moot. However, as Haught and Clegg correctly point out, there is insufficient evidence in the record to support Action's assertions. The record does not show the magistrate was ever presented with notice of the payment and there is no record that the district court ruled on the mootness issue on intermediate appeal. It is the responsibility of the appellant to provide a sufficient record to substantiate his or her claims on appeal. Powell v. Sellers, 130 Idaho 122, 127, 937 P.2d 434, 439 (Ct. App. 1997). In the absence of an adequate record on appeal to support the appellant's claims, we will not presume error. Id. Therefore, we will not consider Action's claim of mootness further.

Chapman further asserts that Haught and Clegg's complaint was properly dismissed because it was not verified when it was filed. Haught and Clegg attempted to remedy this oversight by filing an independent verification of the third-party complaint with the court several days after the initial filing. We do not need to address this issue based on our ultimate ...


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