Adp Dealer Services Group v. Carroll Motor

• Decision Date: 06 December 2005
• Docket Number: No. ED 86139.,ED 86139.
• Citation: 195 S.W.3d 1
• Parties: ADP DEALER SERVICES GROUP, et al., Appellants, v. CARROLL MOTOR COMPANY d/b/a Miller Kehl Motor Co., et al., Respondents.
• Court: Missouri Court of Appeals

195 S.W.3d 1

ADP DEALER SERVICES GROUP, et al., Appellants, v. CARROLL MOTOR COMPANY d/b/a Miller Kehl Motor Co., et al., Respondents.

No. ED 86139.

Missouri Court of Appeals, Eastern District, Division Four.

December 6, 2005.

COPYRIGHT MATERIAL OMITTED

Jay L. Kanzler, Jr., St. Louis, MO, for appellants.

Louis J. Leonatti, Mexico, MO, Isidore I. Lamke, Washington, MO, for respondents.

ROBERT G. DOWD, JR., Judge.

ADP Dealer Services Group ("ADPDS") and ADP Leasing ("ADPL")(collectively referred to as "Plaintiffs") appeal from the trial court's judgment dismissing their petition with prejudice against Carroll Motor Company d/b/a Miller-Kehl Motor Co. ("Miller-Kehl") and Audrain County Motor Company, Inc. f/k/a Franklin County Auto Management d/b/a Auffenberg Motor Co. ("Auffenberg")(collectively referred to as "Defendants") for breach of contract under a lease agreement and a service agreement. On appeal, Plaintiffs argue the trial court erred in dismissing their petition because (1) the proper party, ADP, Inc., was identified in the petition and has the capacity to sue, (2) Defendants waived any argument that Plaintiffs lacked capacity to sue, (3) the trial court impermissibly considered matters outside the pleadings, and (4) the trial court failed to make the necessary findings under Rule 52.04. We affirm.

Miller-Kehl operated a car dealership in Mexico, Missouri.¹ Auffenberg is a car dealership operating in Mexico, Missouri. Plaintiffs are divisions of ADP, Inc., a Delaware corporation with its principal place of business in the State of New Jersey.

On October 14, 1994, Miller-Kehl entered into a Master Equipment Lease Agreement with ADPL for the lease of certain equipment related to the operation of the dealership. On August 4, 1998 and August 28, 1998, Miller-Kehl executed a Supplemental Agreement and Schedule to the Master Lease Agreement with ADPL ("Lease Agreement").

On March 15, 1999, Miller-Kehl entered into an Asset Purchase Agreement in which Auffenberg purchased the assets and liabilities of Miller-Kehl, including the Lease Agreement. Auffenberg continued to make payments to ADPL for use of the equipment until January 2001. Auffenberg allegedly defaulted under the terms of the Lease Agreement, and ADPL took possession of the equipment and demanded payment of the balance of payments due.

On June 21, 1999, following execution of the Asset Purchase Agreement, Auffenberg executed a Master Services Agreement ("Services Agreement") with ADPDS, under which Auffenberg agreed to pay ADPDS for equipment, software, maintenance and support services described in the Services Agreement. Auffenberg allegedly defaulted in the payment of sums under the Services Agreement and ADPDS declared all unpaid indebtedness immediately due.

Plaintiffs then filed a cause of action against Defendants in the United States District Court for the Eastern District of Missouri. Both Defendants filed motions to dismiss for failure to state a claim and for lack of subject matter jurisdiction based on the premise that the $75,000 federal subject matter jurisdictional requirement was not met and that the interests of the two separate Plaintiffs, ADPL and ADPDS, could not be combined to reach the $75,000 jurisdictional threshold. Miller-Kehl further argued that it should be dismissed from the case because ADPL had not met its jurisdictional amount in controversy as to the claim against it.

The federal district court entered an order dismissing the lawsuit for lack of subject matter jurisdiction. The federal district court found that the jurisdictional amount, $75,000, was not met as to Miller-Kehl, and the claim was dismissed as to Miller-Kehl. The federal district court also found that the real party in interest was ADP, Inc., and not ADPL and ADPDS. In its order, the federal district court gave Plaintiffs 10 days in which to file an amended complaint naming ADP, Inc. as the real party in interest. Rather than refile in federal court, Plaintiffs filed the identical lawsuit in the Circuit Court of Audrain County, Missouri. In their two-count petition, Plaintiffs again alleged Auffenberg and Miller — Kehl defaulted in the payment of the sums due under the Lease Agreement and alleged Auffenberg defaulted in the payment of the sums due under the Services Agreement. In Count I, Plaintiffs sought judgment against Miller-Kehl and Auffenberg in the sum of $56,926.26, plus expenses and attorney's fees. In Count II, Plaintiffs sought judgment against Auffenberg in the sum of $61,845.81, plus expenses and attorney's fees. Miller-Kehl and Auffenberg both filed answers to Plaintiffs' petition.

Several months after filing their petition, Plaintiffs filed a motion for summary judgment. Miller-Kehl filed its response to the Plaintiffs' motion for summary judgment. Miller-Kehl stated in its response that Plaintiffs had lost their claim for failing to file it within 2 years of the dissolution of the corporate status of Miller-Kehl. Miller-Kehl further stated that the real party in interest never filed its claim against it within the permissible 2-year statutory period. Auffenberg also filed its response to the Plaintiffs' motion for summary judgment. In its response, Auffenberg stated that Plaintiffs were not legal entities and lacked capacity to litigate their claim.

The trial court denied Plaintiffs' motion for summary judgment and set the matter for trial. Defendants then filed separate motions to dismiss. Miller-Kehl filed its motion to dismiss Count I of Plaintiffs' petition on the grounds that:

. . . it fails to state a cause of action upon which relief may be granted. As a basis for this Motion, the Defendant incorporates by reference its brief Memorandum which is attached hereto and incorporated by reference. The real party in interest has not filed suit as a Plaintiff in this case. In addition, ADP has failed to pursue its claim within the 2 year statutory period provided for corporations which have dissolved.

Auffenberg separately filed its motion to dismiss Counts I and II of Plaintiffs' petition. The grounds asserted for dismissal were "... Plaintiff, ADP Dealer Services Group, a Division of ADP, Inc. and ADP Leasing, a Division of ADP, Inc, do not have legal capacity to sue." A hearing on the motions was scheduled.

On the day of the hearing, Plaintiffs filed a motion to substitute ADP Commercial Leasing, L.L.C. (ADP Commercial Leasing) as a party Plaintiff as to Count I in place of ADP, Inc. In the motion to substitute, Plaintiffs claimed that on April 25, 2003 ADP Commercial Leasing received an assignment of chattel paper which included the Master Equipment Lease and rental schedules identified in Count I of Plaintiffs' petition.² This motion was denied.

Thereafter, the trial court granted Defendants' motions to dismiss. In its judgment, the trial court dismissed the Plaintiffs' petition finding that all of the documents produced at the hearing indicated that payments on the Master Equipment Lease were made to ADP Credit Corporation and that all demands for payment were made by ADP Credit Corporation. The trial court further found that ADP Credit Corporation was not a party to the lawsuit and Plaintiffs had not sought to join ADP Credit Corporation as a plaintiff. The trial court therefore entered its judgment dismissing the petition as to the named Plaintiffs only, with prejudice. Plaintiffs filed their Motion to Reconsider and/or to Vacate Judgment which the trial court denied. This appeal follows.³

We begin by addressing Plaintiffs' third point first because this will determine our standard of review.

In their third point, Plaintiffs argue the trial court erred in dismissing their Petition because the trial court impermissibly considered matters outside the pleadings. Specifically, Plaintiffs contend they had no notice that the trial court would consider matters outside the pleadings and treat the motions to dismiss as a motion for summary judgment. We disagree.

Review of the trial court's ruling on a motion to dismiss is generally limited to the sufficiency of the pleadings on their face. Claude v. Ceccarini, 110 S.W.3d 843, 846 (Mo.App. E.D.2003). Where, however, the parties introduce evidence beyond the pleadings, a motion to dismiss is converted to a motion for summary judgment. Id. In order to consider matters outside of the pleadings and treat a motion to dismiss as one for summary judgment, the trial court must first give the parties notice that it is going to do so, and it must provide all parties a reasonable opportunity to present all materials made pertinent to a motion for summary judgment. Goe v. City of Mexico, Missouri, 64 S.W.3d 836, 838 (Mo.App. E.D. 2001). However, notice by the trial court is not required when a party or parties acquiesce in the trial court treating a motion to dismiss as a motion for summary judgment. Osage Water Company v. City of Osage Beach, 58 S.W.3d 35, 41 (Mo.App. S.D.2001). Thus, where the parties introduce evidence beyond that contained in the petition, a motion to dismiss is converted to a motion for summary judgment and the parties are charged with knowledge that the motion was so converted. Id.

Here, Plaintiffs never objected to any information provided to the trial court during the hearing on the motions to dismiss. The evidence referred to was acquired through depositions and not objected to by Plaintiffs. Specifically, Plaintiffs did not object to evidence which showed the checks on the lease were made payable to ADP Credit Corporation and not ADPL. In addition, Plaintiffs made reference to the assignment of the leasing agreement to ADP Credit Corporation subsequent to the filing of the lawsuit. Because matters outside of the pleadings were presented to the trial court, the motion to dismiss was converted to a motion for summary judgment, and this court reviews the matter under a summary judgment standard of review. Claude, 110 S.W.3d at 846.

The trial court...