Arturo Camacho, et al., Respondents, vs. Todd and Leiser Homes, Appellant.

This opinion will be unpublished and

may not be cited except as provided by

Minn. Stat. § 480 A. 08, subd. 3 (2002).

 

STATE OF MINNESOTA

IN COURT OF APPEALS

A04-599

 

Arturo Camacho, et al.,

Respondents,

 

vs.

 

Todd and Leiser Homes,

Appellant.

 

Filed December 21, 2004

Vacated in part, reversed in part; motion granted

Lansing, Judge

 

Ramsey County District Court

File No. C0-03-11921

 

Mark P. Hodkinson, J. Scott Andresen, Bassford Remele, P.A., Suite 3800, 33 South Sixth Street, Minneapolis, MN 55402-3707 (for respondents)

 

Michelle D. Christensen, Holly J. Tchida, Murnane, Conlin, White & Brandt, Suite 1800, 444 Cedar Street, St. Paul, MN 55101 (for appellant)

 

            Considered and decided by Shumaker, Presiding Judge; Lansing, Judge; and Forsberg, Judge*.

U N P U B L I S H E D   O P I N I O N

LANSING, Judge

The district court denied a motion to dismiss, for lack of personal jurisdiction, a homeowner's negligence and breach-of-warranty action against a dissolved corporation that acted as the general contractor during the construction of the home.  Because Minnesota law bars an action that is not brought within two years of notice of corporate dissolution and this action was brought more than six years after the dissolution notice, we reverse the order denying dismissal.  We also vacate the erroneously entered judgment and strike portions of a brief that are not part of the record on appeal.

F A C T S

 

            Todd and Leiser Homes, Inc., was a Minnesota corporation that, in 1993, acted as general contractor for the construction of a home that was later purchased by Arturo and Kristi Camacho.  In 2003 the Camachos sued Todd and Leiser for negligence and breach of home-construction warranties that caused structural moisture-infiltration damage.

            The Camachos served a summons and complaint on the former vice president of Todd and Leiser in September 2003.  At that time, the corporation was dissolved.  In 1997 Todd and Leiser filed a notice of intent to dissolve with the Minnesota Secretary of State.  In 1999 the corporation filed articles of dissolution, stating that it had followed the proper statutory procedures for dissolution and that all known creditors, liabilities, and obligations had been paid. 

In its answer to the Camachos's complaint, Todd and Leiser stated that it was a dissolved corporation, appended both a copy of its 1997 notice of intent to dissolve and a certified copy of its 1999 dissolution certificate, and asserted lack of personal jurisdiction because the claims were not within two years of Todd and Leiser's notice of intent to dissolve.  After a hearing on Todd and Leiser's motion to dismiss, the district court held that the ten-year warranty for major home-construction defects provided in Minn. Stat. § 327 A. 01 (2002) precluded dismissal.  In the same order, the district court included a proviso that judgment should be entered forthwith because there was no just reason for delay.  In this appeal from judgment, Todd and Leiser additionally moves to strike discovery documents served after the denial of the dismissal motion and argument based on these documents.

D E C I S I O N I

Todd and Leiser frames the issues for appeal differently than the Camachos.  Because each construction of the issues raises questions of appealability, scope, and jurisdiction, we address these issues first.

Todd and Leiser moved to dismiss for lack of personal jurisdiction.  The district court denied the motion, holding that the court had personal jurisdiction over the dissolved corporation.  The denial of a motion to dismiss for lack of personal jurisdiction is immediately appealable.  See Hunt v. Nev. State Bank, 285 Minn. 77, 88, 172 N.W.2d 292, 299-300 (1969) (discussing the appealability of orders).  Whether personal jurisdiction exists presents a legal question that we review de novo.  Griffis v. Luban, 646 N.W.2d 527, 531 (Minn. 2002),  cert. denied, 538 U.S. 906, 123 S. Ct. 1483 (2003).

            The Camachos contend that Todd and Leiser's motion became one for summary judgment because the district court considered matters beyond the complaint in issuing its order.  See Minn. R. Civ. P. 12.02 (stating that when matters outside the pleadings are presented and not excluded by the district court, a motion to dismiss shall be treated as one for summary judgment under Minn. R. Civ. P. 56).  But the contested documents were attached to the pleadings and referred directly to matters alleged in the complaint.  A district court may consider documents referenced in the pleadings without converting the motion to one for summary judgment.  See Martens v. Minn. Mining & Mfg. Co., 616 N.W.2d 732, 739 n.7 (Minn. 2000) (deciding to limit review of order for dismissal to particular documents and statements referred to in complaint when district court considered only statements pleaded in complaint). 

We, therefore, review the district court's order as a denial of a motion to dismiss for lack of personal jurisdiction, which Todd and Leiser may immediately appeal as a determination of right.  See Hunt, 285 Minn. at 89, 172 N.W.2d at 300 (stating that an order denying motion to dismiss for lack of personal jurisdiction acts "not merely as a retention of an action for trial, but as a determination of right," compelling "a defendant . . . to take up the burden of litigation . . . that might otherwise be avoided"). 

In the order denying the motion, the district court ordered the entry of judgment based on "no just reason for delay."  This language typically directs the entry of partial judgment under Minn. R. Civ. P. 54.02, which allows the district court, in its discretion, to direct entry of final judgment on fewer than all of the claims or parties in an action when making an express determination that no just reason for delay exists.  Novus Equities Corp. v. EM-TY P'ship, 381 N.W.2d 426, 428 (Minn. 1986).  But rule 54.02 applies only if the court has completely adjudicated fewer than all claims in a lawsuit.  See id.  ("The purpose of the rule 54.02 is to prevent piecemeal, interlocutory appeals and possible prejudice from the adjudication of less than all claims involved." (Emphasis added.)).  The district court's denial of Todd and Leiser's motion to dismiss did not completely adjudicate any claim.  Thus, the judgment was erroneously entered and, accordingly, we vacate it. 

II

 

As a preliminary matter, we note that a party may serve process on a voluntarily dissolved Minnesota corporation by serving the secretary of state, "so long as claims are not barred under the provisions . . . that governed the business entity."  Minn. Stat. § 5.25, subd. 5(b) (2002).  We find no indication in the file that the Camachos effected service on the secretary of state; the filed affidavit establishes service only on Todd and Leiser's former vice president.  At oral argument, the Camachos stated that they had served the secretary of state, but Todd and Leiser disputed this assertion.  Because this aspect of service was not challenged in the district court, we do not address it in our analysis.

The focal point of this appeal is whether the Camachos's claims are statutorily barred by chapter 302A of the Minnesota Statutes, which governed Todd and Leiser at the time of corporate dissolution and thus determines the issue of personal jurisdiction.  See Podvin v. Jamar Co., 655 N.W.2d 645, 648 (Minn. App. 2003) (determining sufficiency of process and personal jurisdiction based on provisions that govern the business entity under chapter 302A).

Statutory construction is a question of law, reviewable de novo.  Ryan Contracting, Inc. v. JAG Invs., Inc., 634 N.W.2d 176, 181 (Minn. 2001).  Courts must first look to statutory language to determine its meaning.  Minn. Stat. §  645.16 (2002).  If the meaning of a statute is plain and unambiguous on its face, "judicial construction is neither necessary nor proper."  Occhino v. Grover, 640 N.W.2d 357, 359 (Minn. App. 2002), review denied (Minn. May 28, 2002). 

Although Todd and Leiser did not provide general notice to creditors and claimants of its filing of intent to dissolve, it certified in its 1999 articles of dissolution that it had provided for payment of all known debts, obligations, and liabilities.  Therefore, Minn. Stat. § 302 A. 7291 governs its dissolution procedures.  See Minn. Stat. § 302 A. 7291 (2002)(stating applicability of section to corporations that do not give notice).  According to the plain language of Minn. Stat. § 302 A. 7291, subd. 3(a), if a corporation has paid or provided for all known claimants when its articles of dissolution are filed, a claimant, who fails to file a claim or pursue a remedy within two years after the filing of the notice of intent to dissolve, is barred from suing on that claim.  Id., subd. 3(a). Therefore, by operation of statute, the Camachos had until 1999, two years after the filing of the 1997 notice of intent to dissolve, to file a claim against the corporation.  Their failure to do so bars them from pursuing the action beyond that date.

Even if Todd and Leiser had not provided for payment of all known creditors when the articles of dissolution were filed, Minn. Stat. § 302 A. 7291, subd. 3(b), would nonetheless bar the Camachos's claim absent an exception enumerated in Minn. Stat. § 302 A. 781.  See Minn. Stat. § 302 A. 781, subds. 2 (claimant who establishes good cause for failing to file claim may apply to court to allow claim within one-year-period after articles of dissolution filed), 3 (2002) (claimant to whom "known contractual debts, obligations, and liabilities [are] incurred" during course of winding up corporation's affairs may pursue remedy against corporate officers and directors before expiration of applicable statute of limitations).  Neither exception applies.  We have interpreted the term "liabilities incurred"  under a previous version of Minn. Stat. § 302 A. 781, subd. 3, to mean an obligation that the corporation was legally required to pay at the time of dissolution proceedings, rather than an unmatured tort or contract claim.  See Podvin, 655 N.W.2d at 650 (holding that tort and contract claims asserted against dissolved corporation sixteen years after voluntary dissolution under Minnesota Business Corporations Act were barred by the act and did not fall within exception for liabilities incurred during dissolution proceedings).  

The Camachos suggest that a material factual issue exists on whether Todd and Leiser misrepresented that it had provided for payment of all claims before dissolution.  But their complaint asserted only causes of action for negligence and breach of warranty, not fraud.  See id. at 652 (noting that "[i]n the absence of fraud," a dissolved corporation should "be able to rely on the promise" that adhering to statutory dissolution procedures will protect against claims accruing years later (quotation omitted)).  Further, the Camachos chose to pursue a remedy only against the dissolved corporation, rather than against its officers, directors, or shareholders.  See id. at 651 (holding that exception under Minn. Stat. § 302 A. 781, subd. 3 did not apply when plaintiff attempted to sue only dissolved corporation, rather than associated officers, directors, or shareholders). 

The district court relied on the home-construction-warranty statute, Minn. Stat. § 327 A. 02 (2002), to extend Todd and Leiser's corporate existence beyond the limits provided in chapter 302A.  The home-construction-warranty statute provides a time gradation for bringing breach-of-home-warranty actions.  See Koes v. Advanced Design, Inc., 636 N.W.2d 352, 357-58 (Minn. App. 2001) (holding that plaintiff must bring home warranty action within two years of date of discovery of the breach of warranty), review denied (Minn. Feb. 19, 2002); see also Vlahos v. R & I Constr. of Bloomington, Inc., 676 N.W.2d 672, 678 (Minn. 2004) (holding that statutory new-home-warranty limitations period began to run when initial or subsequent purchaser discovered builder's refusal or inability to ensure that home was free from major construction defects).  The district court essentially interpreted the procedural time limitation in the home-warranty provisions to create affirmative rights that would supersede the corporate-dissolution statutes.  We find no authority for this extension of substantive rights.

Unlike statutes of limitation, which bar a right of action unless it is filed within a specific time period after injury occurs, Koes, 636 N.W.2d at 357, the corporate-survival statutes provide a definite point in time for terminating the existence of a corporation and the transaction of its business.  Mattson v. Underwriters at Lloyds of London, 385 N.W.2d 854, 858 (Minn. App. 1986), review denied (Minn. June 19, 1986).  Although corporate-survival statutes may have a harsh effect on a claimant whose action falls outside the survival period, these statutes were enacted to mitigate the harsh effect of the common law by extending the period of time that a dissolved corporation is subject to claims.  See id. (invalidating dissolved corporation's assignment after the statutory period); see also Onan Corp. v. Indus. Steel Corp., 770 F. Supp. 490, 493 (D. Minn.) (listing several Minnesota cases holding that voluntarily dissolved corporation may be sued only within the statutorily permitted period).  Because a corporation exists by virtue of statutory authority, its existence and capacity to sue or be sued is also determined by statutory authority.  Id.  Courts do not have the prerogative to extend corporate liability beyond the express time limits provided by statute.

The Camachos argue alternatively for the right to assert their claim to the extent of any existing insurance coverage maintained by Todd and Leiser.  But Minnesota has no direct action statute allowing an injured plaintiff to proceed directly against an insurer.  Drake v. Ryan, 514 N.W.2d 785, 789 (Minn. 1994).  The Camachos are third parties to any claim on Todd and Leiser's liability insurance policy and would have no contractual right to recover under that policy.  

Therefore, we conclude that the district court erred in denying the motion to dismiss for lack of personal jurisdiction.

III

Todd and Leiser move to strike discovery documents and a letter from counsel that are included in the appendix to the Camacho's brief.  They also move to strike arguments in the brief predicated on these documents.  The Camachos served the discovery requests and the letter on Todd and Leiser after the denial of the motion to dismiss and did not file the documents in the district court.  Consequently, they do not form part of the record on appeal.  See Minn. R. Civ. App. P. 110.01 (stating that the record on appeal consists of "[t]he papers filed in the trial court, the exhibits, and the transcript of the proceedings").  We grant the motion to strike the documents and the legal arguments based on these documents.

Vacated in part, reversed in part; motion granted.

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