Colonial Baking Co. of Des Moines v. Dowie

• Decision Date: 16 February 1983
• Docket Number: No. 68184,68184
• Citation: Colonial Baking Co. of Des Moines v. Dowie, 330 N.W.2d 279, 35 U.C.C.Rep. 874 (Iowa 1983)
• Parties: 35 UCC Rep.Serv. 874 COLONIAL BAKING COMPANY OF DES MOINES, Appellee, v. Frederick J. DOWIE, Appellant, and Fred Dowie Enterprises, Inc., Defendant.
• Court: Iowa Supreme Court

Page 279

330 N.W.2d 279

35 UCC Rep.Serv. 874

COLONIAL BAKING COMPANY OF DES MOINES, Appellee, v. Frederick J. DOWIE, Appellant and Fred Dowie Enterprises, Inc., Defendant.

No. 68184.

Supreme Court of Iowa.

Feb. 16, 1983.

Joseph B. Joyce of Adler, Brennan, Joyce & Steger, Des Moines, for appellant.

Jon P. Sullivan of Dickinson, Throckmorton, Parker, Mannheimer & Raife, Des Moines, for appellee.

Considered by LeGRAND, P.J., and McCORMICK, McGIVERIN, LARSON, and SCHULTZ, JJ.

SCHULTZ, Justice.

The events leading to this appeal began when Frederick J. Dowie, president and sole stockholder of Fred Dowie Enterprises, Inc. (corporation), a catering corporation, obtained the opportunity to operate concession stands at the Living History Farms during the Pope's visit to Des Moines in 1979. With high expectations Dowie ordered 325,000 hotdog buns from the Colonial Baking Company (Colonial). Before the buns were delivered he presented to Colonial a postdated check in the amount of $28,640. This check shows the name of the corporation and its address in the upper lefthand corner. The signature on the check is in the form "Frederick J. Dowie" and there are no other words of explanation. Unfortunately, dreams of riches often turn to dust and so it was in this case; only 300 buns were sold. Following a dispute over the ownership and responsibility for the remaining buns, payment was stopped on the check.

Colonial then sued Dowie in his personal capacity as signer of the check. Colonial moved for a summary judgment against Dowie, but the district court, J.P. Denato, J., overruled the motion. Colonial then joined the corporation as codefendant and tried the case to a jury. The district court, Van Wifvat, J., entered a judgment pursuant to the jury verdict in the amount of $14,320 against the defendants.

Although the corporation did not appeal from this judgment, Dowie took an appeal in his personal capacity. He argues that he has no personal responsibility on the check because it was imprinted with the corporation's name, even though his signature does not indicate representative capacity. Colonial cross-appealed and urges that its motion for summary judgment against Dowie should have been sustained and judgment should have been entered in its favor for the full amount of the check. Colonial maintains that a person who signs a corporate check which does not show that he signed in a representative capacity is personally obligated for payment of the check, unless it is otherwise established between the parties that he is not so obligated. It asserts that although its motion for summary judgment was supported by affidavit, Dowie's resistance offered no affidavit or other evidentiary support for his resistance and thus, pursuant to Iowa R.Civ.P. 237(e), summary judgment should have been awarded against Dowie as there is no genuine issue for trial. Dowie, of course, argues that the trial court did not err in overruling the motion for summary judgment. He also moved to dismiss Colonial's cross-appeal on the basis of untimeliness. We hold that the trial court erred when it overruled Colonial's motion for summary judgment. We also find that the cross-appeal was timely filed as to Dowie and we overrule the motion to dismiss. In view of these determinations, other issues need not be addressed. We reverse the decision of the district court and remand for entry of judgment for the plaintiff consistent with the relief sought on the motion for summary judgment.

Since the issue of Dowie's personal responsibility on the check is the gravamen of both Dowie's appeal and Colonial's cross-appeal, we shall address the issue in the context of the motion for summary judgment. First, however, we discuss Dowie's motion to dismiss plaintiff's cross-appeal.

I. Motion to dismiss. Dowie contends that the corporation was served an untimely notice of cross-appeal and moved to dismiss it. We dismiss the cross-appeal against the corporation only.

There is no dispute about the facts. The thirtieth day after the judgment fell on Saturday, January 30. Dowie filed a timely appeal on Monday, February 1 ¹; however, the corporation did not appeal. The cross-appeal was filed on the following day, February 2. Although the thirty day period for taking a direct appeal had passed, Colonial's cross-appeal against Dowie was timely filed because it was filed within five days after Dowie had taken his appeal. Iowa R.App.P. 5(a) ("[a] cross-appeal may be taken within the thirty days for taking an appeal or in any event within five days after the appeal is taken.").

We need not decide whether Colonial may maintain a timely cross-appeal against the corporation. At oral argument Colonial indicated that it was no longer interested in pursuing the cross-appeal against the corporation, and we deem it has abandoned that cross-appeal and that this issue is now moot.

Dowie also contends that if the judgment against himself and the corporation is permitted to stand, it must be equal as against each defendant because their interests are not legally severable. This argument might have been relevant if we had denied Dowie's claims on appeal, allowed the judgment to stand, and then considered Colonial's argument on damages. Since we now hold that the district court erred in overruling plaintiff's motion for summary judgment and we remand for an entry which will necessarily replace the judgment entered on the jury's verdict against Dowie, the argument is irrelevant. At the time the erroneous ruling on the summary judgment was entered in district court, the corporation was not a party to the litigation. Colonial's judgment against the corporation will remain, however, as the corporation did not appeal. Nevertheless, Colonial may not recover from both parties a sum that would exceed the amount rendered on the summary judgment; it is further limited in its recovery against the corporation to the amount of the original judgment.

II. Representative capacity. In its petition in the underlying action Colonial alleged that Dowie signed and delivered the check in question, that the check was not paid, that Dowie owed Colonial the amount of the check, and that judgment should be awarded to Colonial. A copy of the check was attached to the pleadings. Dowie filed an answer in which he denied each allegation contained in Colonial's petition. Colonial then filed a motion for summary judgment and supported the motion with an affidavit from Colonial's president. He attested to his personal knowledge of the truth of the facts contained in the petition and his competency to testify. Colonial concurrently filed a supporting statement and memorandum which pointed out that Dowie did not deny his signature in his answer and that he had not responded in a timely fashion to a request for an admission that it was his signature. The memorandum then pointed out that the signature was deemed genuine in absence of the denial in the answer pursuant to Iowa R.Civ.P. 100 and because of defendant's failure to respond to the request for admission pursuant to Iowa R.Civ.P. 127. Plaintiff further pointed out that its allegations of delivery and nonpayment were supported by the affidavit and it claimed that the undisputed facts entitled it to a judgment as a matter of law. Dowie's resistance to the motion for summary judgment consisted solely of an unsupported written denial of the allegations contained in the motion for summary judgment. At the hearing on the motion Dowie apparently argued, as he does at this time, that the check was an obligation of the corporation and not a personal responsibility. The district court simply denied the motion and noted "(the check is a corporate check)".

Colonial claims that this resistance did not create an issue of genuine fact. Iowa R.Civ.P. 237(e) in pertinent part provides:

When a motion for summary judgment is made and supported as provided in this rule, an adverse party may not rest upon the mere allegations or denials of his pleading, but his response, by affidavits or as otherwise provided in this rule, must set forth specific facts showing that there is a genuine issue for trial. If he does not so respond, summary judgment, if appropriate, shall be entered against him.

Colonial claims that because Dowie failed by affidavit or other proof to contradict plaintiff's petition and verify proof, and instead rested on his pleadings, that the trial court erred in failing to grant summary judgment.

A motion for summary judgment may be sustained only when the moving party shows there is no genuine issue of fact and that the moving party is entitled to judgment as a matter of law. Iowa R.Civ.P. 237(c). The burden of showing there is no issue of material fact is upon the moving party. Meyer v. Nottger, 241 N.W.2d 911, 917 (Iowa 1976). If the moving party has supported his motion, an adverse party may not rest upon the allegations or denials in his pleadings, but must show there is a genuine issue of fact. Iowa R.Civ.P. 237(e). Even when the facts are undisputed, however, summary judgment is inappropriate if reasonable minds may draw different inferences from them. Tasco, Inc. v. Winkel, 281 N.W.2d 280, 282 (Iowa 1979).

In this case Dowie by his limited resistance rested upon the pleadings; thus...