ALEXANDER TECHNOLOGIES EUROPE, LTD., Plaintiff-Appellee, vs. MACDONALD LETTER SERVICE, INC., Substituted Party for Amazing Products Co. and Richard Westcott, Defendant-Appellant.
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IN THE COURT OF APPEALS OF IOWA
No. 7-183 / 05-2023
Filed June 27, 2007
ALEXANDER TECHNOLOGIES EUROPE, LTD.,
Plaintiff-Appellee,
vs.
MACDONALD LETTER SERVICE, INC.,
Substituted Party for Amazing Products Co.
and Richard Westcott,
Defendant-Appellant.
________________________________________________________________
Appeal from the Iowa District Court for Cerro Gordo County, James M.
Drew, Judge.
Defendant appeals from the district court’s grant of a summary judgment
motion in favor of plaintiff in an action of replevin. AFFIRMED.
Mark C. Daggy, Des Moines, pro se, for appellant.
John L. Duffy of Heiny, McManigal, Duffy, Stambaugh & Anderson, P.L.C.,
Mason City, for appellee.
Considered by Zimmer, P.J., and Miller and Baker, JJ.
2
MILLER, J.
MacDonald Letter Service, Inc. (MacDonald) appeals from the district
court’s grant of summary judgment in favor of Alexander Technologies Europe,
Ltd. (Alexander) in an action of replevin. We affirm the judgment of the district
court.
I.
BACKGROUND FACTS AND PROCEEDINGS.
The summary judgment record reveals the following undisputed facts.
Alexander designs, manufactures, and distributes plastic containers for batteries
and battery chargers. An initial step of the manufacturing process involves the
fabrication of “molds,” which are used to form the plastic containers housing the
charging systems.
Alexander designs the molds according to its customers’
specifications. It brings the mechanical design of the mold to a “toolmaker” who
builds the mold from steel or aluminum. Alexander then takes the completed
mold to a “plastic supplier.” The plastic supplier uses the mold to construct the
plastic product for Alexander.
Amazing Products Co. (Amazing), which is owned by Richard Westcott, is
a plastic product supplier for Alexander. Amazing leases space in the basement
of Alexander’s domestic office in Mason City, Iowa. Alexander allowed Amazing
use of its molds so that Amazing could produce plastic products for Alexander.
Alexander filed a petition for a writ of replevin, seeking immediate return of the
molds and miscellaneous “mold components” (disputed property) in the
possession of Amazing and Westcott. An itemized list of the disputed property
Alexander sought possession of was attached to its petition.
Amazing and
Westcott filed an answer denying all of the allegations set forth in the petition.
3
On March 23, 2005, a hearing was held pursuant to Iowa Code section
643.7 (2005) due to Alexander’s desire for immediate delivery of the disputed
property.
At the hearing, the parties stipulated Alexander was entitled to
immediate possession of the disputed property. The only issue before the court
was the amount of the bond Alexander would be required to post in order to
obtain immediate possession. Following the hearing, the district court entered an
order directing the clerk of court to issue a writ of replevin requiring the sheriff to
deliver the disputed property to Alexander once it posted a bond in the amount of
$758,800.
Before the writ was executed, Amazing and Westcott attempted to post a
delivery bond pursuant to section 643.12 in order to retain possession of the
disputed property. The district court denied their request, reasoning the parties’
stipulation regarding Alexander’s right to immediate possession of the disputed
property precluded Amazing and Westcott from posting a delivery bond.
Alexander thereafter posted the required bond and obtained possession of the
property.
On May 25, 2005, Westcott assigned “all rights pertaining to this case now
vested in either Amazing Products Co. or Richard Westcott” to MacDonald Letter
Service, Inc. (MacDonald). Mark C. Daggy, chief executive officer of MacDonald,
filed a “Substitution of Party and Appearance” on behalf of MacDonald, which
gave “notice of Substitution of MacDonald Letter Service, Inc. as Defendant in
this action.” 1 Alexander filed a motion for summary judgment on November 8,
1
It does not affirmatively appear from the record that Daggy is a licensed attorney. “[A]
corporation may not represent itself through nonlawyer employees, officers, or
shareholders.” Hawkeye Bank and Trust, Nat’l Ass’n v. Baugh, 463 N.W.2d 22, 25 (Iowa
4
2005, asserting it was entitled to possession of the disputed property as a matter
of law. On November 28, 2005, MacDonald filed a request seeking additional
time to respond to the summary judgment motion and an indefinite continuance
of the hearing on said motion.
The motion for summary judgment was heard by the court on December
5, 2005. MacDonald filed a resistance to the summary judgment motion on the
day of the hearing and withdrew its request to continue the hearing. The district
court denied MacDonald’s motion for additional time to respond to the summary
judgment motion and declined to “consider the defendant’s resistance except to
the extent it constitutes legal argument.”
The district court determined no
genuine issue of material fact existed on the “question of plaintiff’s right to
permanent possession of the property.” The court accordingly entered summary
judgment in favor of Alexander. Alexander filed a motion pursuant to Iowa Rule
of Civil Procedure 1.904(2), requesting the court modify its ruling by entering an
order discharging its bond. The district court granted the motion and entered an
order exonerating the bond posted by Alexander.
MacDonald appeals.
It claims the district court erred in granting the
motion for summary judgment. MacDonald argues the district court should have
considered its resistance to the motion. It further argues summary judgment was
inappropriate due to pleading deficiencies in the petition and Alexander’s failure
to satisfy its burden of proving there was no genuine issue of material fact.
MacDonald also claims the district court erred in denying Amazing and
1990). However, Alexander does not contest Daggy’s representation of MacDonald.
We will therefore consider the briefs filed by Daggy on behalf of MacDonald, although
Daggy’s purported representation is highly improper if he is in fact not a licensed
attorney.
5
Westcott’s request to post a delivery bond and in entering the order discharging
Alexander’s bond.
II.
SCOPE AND STANDARDS OF REVIEW.
An action for a writ of replevin is an ordinary proceeding. Iowa Code §
643.2. Accordingly, our review is for correction of errors at law. Iowa R. App. P.
6.4; Prenger v. Baker, 542 N.W.2d 805, 807 (Iowa 1995).
We also review the district court’s summary judgment rulings for the
correction of errors at law. Iowa R. App. P. 6.4; Faeth v. State Farm Mut. Auto.
Ins. Co., 707 N.W.2d 328, 331 (Iowa 2005). Summary judgment is appropriate
when the pleadings, depositions, answers to interrogatories, admissions on file,
and affidavits show there is no genuine issue of material fact, and the moving
party is entitled to a judgment as a matter of law. Iowa R. Civ. P. 1.981(3);
Grinnell Mut. Reins. Co. v. Jungling, 654 N.W.2d 530, 535 (Iowa 2002). A fact
question arises if reasonable minds can differ on how the issue should be
resolved. Grinnell Mut. Reins., 654 N.W.2d at 535. No fact question arises if the
only conflict concerns legal consequences flowing from undisputed facts. Id.
We review the district court’s refusal to grant additional time to resist a
summary judgment motion for abuse of discretion.
Kulish v. Ellsworth, 566
N.W.2d 885, 889-90 (Iowa 1997). To prove an abuse of discretion, MacDonald
must show the court exercised its discretion for clearly unreasonable or
untenable reasons. In re Estate of Olson, 479 N.W.2d 610, 613 (Iowa Ct. App.
1991) (citations omitted).
6
III.
MERITS.
A.
Timeliness of Resistance.
We first address MacDonald’s claim that the district court was incorrect in
failing to consider its resistance to the summary judgment motion. Alexander
filed its motion for summary judgment on November 8, 2005. MacDonald filed a
request for additional time to resist the motion on November 28, 2005. The proof
of service on the request for additional time to resist indicates it was mailed on
November 22, 2005. MacDonald filed a resistance to the summary judgment
motion on December 5, 2005. Iowa Rule of Civil Procedure 1.981(3) requires
that “[a]ny party resisting the motion shall file a resistance within 15 days, unless
otherwise ordered by the court. . . .” Relying on rule 1.981(3), the district court
determined the resistance was due on November 23, 2005. The court concluded
MacDonald’s resistance should be disregarded because MacDonald did not offer
a “compelling reason for being unable to file a timely resistance.
More
importantly, no request for an extension was made until after the deadline
expired.”
MacDonald argues its request for extension of time was made before the
expiration of the period set forth in rule 1.981(3). We agree. Iowa Rule of Civil
Procedure 1.443(2) provides that when a party is required to respond “within a
prescribed period after the service of a notice or other paper upon the party . . .
three days shall be added to the prescribed period.” Therefore, MacDonald had
until November 28, 2005, to file a resistance to the summary judgment motion. 2
2
The fifteen-day deadline expired on November 26, 2005, which was a Saturday.
MacDonald’s time for filing the resistance was accordingly extended to the next day the
clerk of court’s office was open. See Iowa Code § 4.1(34).
7
The request for extension of time was thus made before the time to resist the
summary judgment motion expired.
Iowa Rule of Civil Procedure 1.443(1)(a) allows the court “in its discretion”
and for “cause shown” to order the “period enlarged if request therefor is made
before the expiration of the period originally prescribed. . . .” 3
MacDonald
requested additional time to file a resistance due to on-going settlement
negotiations between the parties. However, Daggy testified the failure to timely
file a resistance was “partly my fault . . . I hadn’t seen my son that lives in Arizona
and I spent a week down there when I probably should have been working on
this.” Under the circumstances, we find MacDonald did not establish that the
court exercised its discretion “on grounds or for reasons clearly untenable or to
an extent clearly unreasonable.” Kulish, 566 N.W.2d at 889 (internal quotation
omitted). We therefore conclude the district court did not abuse its discretion in
denying MacDonald’s request for additional time to file a resistance to the
summary judgment motion and in refusing to consider the untimely resistance.
B.
Summary Judgment Motion.
“Although our rules of procedure allow a nonmoving party to resist
summary judgment, the burden is still on the moving party to show the district
court that there was no genuine issue of material fact and that it was entitled to a
judgment as a matter of law.” Otterberg v. Farm Bureau Mut. Ins. Co., 696
N.W.2d 24, 27 (Iowa 2005) (citations omitted).
3
A party confronted with a
The parties contend the district court should have applied the “excusable neglect”
standard set forth in rule 1.443(1)(b). That subsection does not apply due to our
conclusion that MacDonald’s request for additional time was made before the “expiration
of the specified period.” See Iowa R. Civ. P. 1.443(1)(b) (“Upon motion made after the
expiration of the specified period” the court may extend the period of time to respond
“where the failure to act was the result of excusable neglect. . . .” (emphasis added)).
8
summary judgment motion can accordingly rely on the district court to correctly
apply the law and deny summary judgment when the moving party fails to
establish it is entitled to judgment as a matter of law. Id. at 27-28.
MacDonald claims the district court did not correctly apply the law by
granting summary judgment where the petition failed to comply with the pleading
requirements set forth in Iowa Code sections 643.1(1) and (3). At the summary
judgment hearing, MacDonald asserted the “motion for summary judgment is
deficient on its face” because Alexander did not “plead facts showing his right to
the property” as required by section 643.1(3). 4
The district court construed
MacDonald’s argument as an untimely motion to dismiss, which it refused to
consider pursuant to Iowa Rule of Civil Procedure 1.441(1). We question the
court’s characterization of MacDonald’s argument as a motion to dismiss.
MacDonald did not argue the petition should be dismissed due to its deficiencies.
Instead, MacDonald argued summary judgment was improper because the
petition failed to comply with the pleading requirements set forth in section
643.1(3). Assuming arguendo the challenge to the pleading was properly raised,
we find the claimed deficiencies in the petition did not preclude entry of summary
judgment.
A petition for a writ of replevin must state, inter alia, “a particular
description of the property claimed” along with “facts constituting the plaintiff’s
right to the present possession thereof, and the extent of the plaintiff’s interest in
the property. . . .” Iowa Code §§ 643.1(1), (3). The petition in this case contains
4
MacDonald argues for the first time on appeal that summary judgment was improper
because the petition also failed to comply with section 643.1(1). Alexander does not
raise any error preservation issues. We will therefore address MacDonald’s argument
under both subsections.
9
an itemized list of the property Alexander sought possession of. We therefore
reject MacDonald’s argument that the petition failed to comply with section
643.1(1).
MacDonald is correct the petition does not set forth facts stating
Alexander’s right to the possession of the property and the extent of its interest
as required by section 643.1(3). We conclude the failure of the petition in this
regard is not fatal. See, e.g., Roger’s Backhoe Serv., Inc. v. Nichols, 681 N.W.2d
647, 651 (Iowa 2004) (finding failure to comply with rule requiring the pleading of
special matters with respect to a contract claim does not render the petition
fatally defective); Berg v. Ridgeway, 258 Iowa 640, 644, 140 N.W.2d 95, 98
(1966) (determining failure to comply with a pleading requirement in a contract
claim is not fatal and can be remedied by requesting a more specific statement or
engaging in discovery).
We do not agree with MacDonald that Lyons v. Sherman, 245 Iowa 378,
62 N.W.2d 196 (1954), requires “a plaintiff in a replevin case [to] comply with the
statutory pleading requirements or . . . the action will be dismissed.”
Lyons
affirmed a district court’s grant of a directed verdict in favor of the defendant in a
replevin action where the plaintiff could not identify which steer he was entitled to
possess. Id. at 381-82, 62 N.W.2d at 198. The decision in Lyons was not based
on a pleading deficiency; rather, it was based on the failure of the plaintiff to
prove an element of his claim.
Id.; see also Prenger, 542 N.W.2d at 810
(affirming trial court’s determination that the plaintiffs were not entitled to
possession of ostriches where they failed to meet their burden of proof as to
identification). We accordingly reject this assignment of error.
10
MacDonald next claims the district court erred in granting the motion for
summary judgment because there is a genuine issue of material fact as to
whether Alexander was entitled to possession of the disputed property at the
time the action was filed. “Replevin is a specialized statutory remedy with a
narrow purpose designed to restore possession of property to the party entitled
to possession.” Roush v. Mahaska State Bank, 605 N.W.2d 6, 9 (Iowa 2000).
“The gist of a replevin action is enforcement of plaintiff’s right to immediate
possession of the property wrongfully taken or detained.” Flickinger v. Mark IV
Apartments, Ass’n, 315 N.W.2d 794, 796 (Iowa 1982). “A wrongful detention
occurs when the defendant wrongfully withholds or retains possession of the
property sought to be recovered.” Id. The plaintiff bears the burden of proving
by a preponderance of evidence that it was entitled to possession at the time the
action was filed. Marx Truck Line, Inc. v. Fredricksen, 260 Iowa 540, 546, 150
N.W.2d 102, 105 (1967).
The undisputed facts in the summary judgement record reveal Alexander
owned the disputed property.
Jay Miller, senior vice president of sales and
engineering for Alexander, testified at the March 23, 2005, bond hearing that the
disputed property was owned by Alexander. 5 He further testified the majority of
the disputed property in Amazing and Westcott’s possession was designed and
built by Alexander.
According to Miller, Alexander allowed Amazing and
Westcott use of the disputed property so that Amazing could produce plastic
products for Alexander. The senior vice president of operations and finance for
Alexander, Tania Cooper, likewise testified the disputed property was owned by
5
A transcript of the hearing was admitted as evidence at the summary judgment hearing.
11
Alexander. She explained the itemized list attached to the petition is an “asset
register,” which “specifically lists tooling that [was] built and manufactured inhouse over the years. . . .” In an affidavit submitted in support of the summary
judgment motion, Westcott averred neither he nor Amazing had any “right of or
claim to possession or ownership of any item of” the disputed property, and
neither he nor Amazing “have been damaged in any way as a result of delivery of
immediate possession of the” property to Alexander. 6
“The fact of ownership draws with it the right of possession. If nothing
further appears, the law raises the presumption the owner is entitled” to
possession.
Varvaris v. Varvaris, 255 Iowa 800, 804, 124 N.W.2d 163, 165
(1963). MacDonald disputes Alexander’s ownership of the disputed property,
arguing “[t]here is evidence in the record” that the disputed property “belonged to
a company called Lexstar Technologies.”
We do not agree with MacDonald
there is any such evidence in the summary judgment record. Furthermore, we
have recognized it is no defense to an action of replevin that legal title to property
is in a third party. Corbitt v. Heisey, 15 Iowa 296 (1863) (finding though “the
outstanding title may have been in a third person . . . it does not follow from this
that plaintiff could not recover.”).
We conclude the undisputed facts in the
summary judgment record establish Alexander was entitled to permanent
possession of the disputed property.
6
MacDonald argues the district court erred in relying on the affidavit because Westcott’s
statement in the affidavit regarding the absence of damages was inconsistent with his
testimony at the March 23, 2005, hearing and the attempt to post a delivery bond. We
find no support in the record for this contention. We further note damages in a replevin
action are only available to the successful party as compensation for the wrongful taking
or detention of the disputed property. Iowa Code §§ 643.16, 643.17; Roush, 605
N.W.2d at 9.
12
C.
Delivery Bond.
MacDonald claims the district court erred in denying Amazing and
Westcott’s request to post a delivery bond. Iowa Code section 643.12 allows a
defendant in a replevin action to post a delivery bond in order to retain
possession of the disputed property while the proceeding is pending. In denying
Amazing and Westcott’s motion, the court reasoned the parties’ stipulation
regarding Alexander’s right to immediate possession of the disputed property at
the March 23, 2005, section 643.7 bond hearing precluded the posting of a
delivery bond.
We agree with MacDonald that the district court erred in
determining Amazing and Westcott could not post a delivery bond.
We first note the parties’ stipulation regarding Alexander’s right to
immediate possession was clearly limited to the March 23, 2005, hearing. At the
hearing, counsel for Amazing and Westcott stated:
For the purposes of this hearing only though I want to make it clear
that at the hearing that will occur later -- that just for this mere
possessory hearing and the posting of the bond we are not
resisting due to any lack of claim to ownership.
Moreover, there is nothing in section 643.12 indicating a defendant must
establish it is entitled to possession of the disputed property before a delivery
bond may be posted. The posting of a delivery bond simply allows the defendant
to retain possession of the disputed property until the ultimate issue of
possession is determined. Therefore, the district court was incorrect in basing its
denial of Amazing and Westcott’s request to post a delivery bond on the parties’
stipulation at the March 23, 2005, hearing. Nevertheless, we conclude reversal
on this ground is not warranted due to our determination the district court was
correct in granting summary judgment in favor of Alexander.
See Shane v.
13
Russell, 250 Iowa 44, 46, 92 N.W.2d 567, 568 (1958) (“A trial court will not be
reversed unless it is shown the complaining party’s rights were prejudiced by a
court’s action.”).
D.
Discharge of Bond.
After MacDonald filed a notice of appeal from the district court’s summary
judgment ruling, Alexander filed a motion pursuant to Iowa Rule of Civil
Procedure 1.904(2) requesting the court modify the ruling by entering an order
discharging its bond. The district court found its failure to “mention the status of
plaintiff’s bond” was “an oversight” that “should be corrected.”
The court
accordingly entered an order exonerating the bond posted by Alexander.
MacDonald claims the district court “erred in entering an order releasing
[Alexander] on the bond in this case after the notice of appeal had been filed.”
When a notice of appeal is filed, sole jurisdiction of the matter is placed in
the appellate court. In re Estate of Tollefsrud, 275 N.W.2d 412, 417 (Iowa 1979).
The trial court thus loses jurisdiction over the merits of a controversy when an
appeal is perfected. Id.; see also Wolf v. City of Ely, 493 N.W.2d 846, 848 (Iowa
1992) (finding the district court did not have jurisdiction to rule on a 1.904(2)
motion that was filed after an appeal had been perfected). However, “a trial court
retains jurisdiction to proceed as to issues collateral to and not affecting the
subject matter of the appeal.” Tollefsrud, 275 N.W.2d at 418. Citing Tollefsrud,
Alexander argues the district court’s order discharging the section 643.7 bond
posted by Alexander was collateral to the subject matter of the appeal. We need
not decide whether the order was collateral, however, because the district court’s
14
grant of summary judgment was correct and error, if any, in the district court’s
exoneration of the bond has thus not prejudiced any rights of MacDonald.
IV.
CONCLUSION.
We find the district court did not abuse its discretion in denying
MacDonald’s request for additional time to resist the summary judgment motion
and in refusing to consider the untimely resistance. We conclude the district
court properly granted summary judgment in favor of Alexander.
Assuming
arguendo MacDonald’s challenge to Alexander’s petition was properly raised, we
find the claimed deficiencies in the pleading did not preclude entry of summary
judgment. We further find the undisputed facts in the summary judgment record
establish Alexander was entitled to permanent possession of the disputed
property.
We conclude the district court did err in denying Amazing and
Westcott’s request to post a delivery bond. However, reversal on this ground is
not warranted due to our determination the district court was correct in granting
summary judgment in favor of Alexander.
Finally, because the district court
correctly granted summary judgment, error, if any, in the court’s exoneration of
Alexander’s bond did not prejudice MacDonald.
judgment of the district court.
AFFIRMED.
We accordingly affirm the
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