Command Center, Inc. v. Renewable Resources, LLC, 032421 NDSC, 20200017
| Opinion Judge | VandeWalle, Justice. |
| Party Name | Command Center, Inc., Plaintiff v. Renewable Resources, LLC, Defendant and Appellee and Shawn Kluver and Little Knife Disposal, LLC, Defendants and Appellants and Renewable Resources, LLC, Third-Party Plaintiff and Appellee v. Shawn Kluver and Little Knife Disposal, LLC, Third-Party Defendants and Appellants |
| Attorney | Jonathan P. Sanstead, Bismarck, ND, for defendant and appellee Renewable Resources, LLC. Ariston E. Johnson, Watford City, ND, for defendants and appellants Shawn Kluver and Little Knife Disposal, LLC. |
| Judge Panel | Jon J. Jensen, C.J., Gerald W.VandeWalle, Daniel J. Crothers, Lisa Fair McEvers, Jerod E. Tufte, Judges |
| Case Date | March 24, 2021 |
| Court | North Dakota Supreme Court |
Appeal from the District Court of Dunn County, Southwest Judicial District, the Honorable James D. Gion, Judge.
Jonathan P. Sanstead, Bismarck, ND, for defendant and appellee Renewable Resources, LLC.
Ariston E. Johnson, Watford City, ND, for defendants and appellants Shawn Kluver and Little Knife Disposal, LLC.
OPINION
VandeWalle, Justice.
[¶1] Shawn Kluver and Little Knife Disposal, LLC ("Little Knife"), appealed from an amended judgment entered after a bench trial that awarded Command Center, Inc., monetary damages, interest, attorney's fees and costs against Renewable Resources, LLC, and Kluver, jointly and severally. The amended judgment also awarded Renewable Resources damages and interest against Kluver and Little Knife, jointly and severally, and ordered them to indemnify Renewable Resources for all damages, interest, attorney's fees, and costs awarded to Command Center. We affirm.
I
[¶2] Command Center is a Washington corporation authorized to do business in North Dakota and provides temporary labor services. Renewable Resources is a North Dakota limited liability company that had previously engaged in the treatment of oilfield waste until the loss of its permit and decommissioning of its plant in September 2016. Little Knife is a North Dakota limited liability company engaged in the operation of a treatment plant near Mandaree, North Dakota, and Kluver is the sole owner of Little Knife.
[¶3] In September 2018, Command Center commenced this action against Renewable Resources in small claims court, claiming unpaid amounts totaling $14, 631.20, which included principal of $13, 423.12 and interest of $1, 208.08, relating to temporary labor services that Command Center provided under agreements with Renewable Resources. Renewable Resources removed the case to district court and answered the claim affidavit.
[¶4] Command Center obtained leave of court to file an amended complaint, also naming Kluver and Little Knife as additional defendants. Kluver had been the manager of Renewable Resources. The amended complaint alleged claims against the various defendants for breach of contract, quantum meruit, and unjust enrichment. Although Renewable Resources was billed and had paid Command Center $20, 000 for the temporary labor services, Renewable Resources alleged that the temporary labor services were provided for the benefit of Little Knife, which was Kluver's company, and that Kluver did not have authority to contract on behalf of Renewable Resources for the temporary labor services that benefited Little Knife.
[¶5] Renewable Resources, Kluver, and Little Knife answered the amended complaint. Renewable Resources also brought a third-party complaint against Kluver and Little Knife, alleging claims for indemnification, unjust enrichment, and breach of duty of loyalty. While the third-party defendants served and filed an answer, Renewable Resources did not file its third-party complaint in the district court. The third-party complaint was, however, filed as an exhibit to Command Center's motion to amend its complaint.
[¶6] In June 2019, the district court held a bench trial. After trial, the court issued an opinion finding in favor of Command Center on its claims and in favor of Renewable Resources on its third-party claims. The court made extensive findings supporting its decision.
[¶7] The district court found that, in December 2016, Kluver contacted Miles Vondra, a former safety manager at a sister company of Renewable Resources, directing Vondra to hire temporary labor from Command Center to assist in the cleanup at the Branch Energy/Little Knife Disposal ("Branch Energy") site. The court found that Kluver had instructed Vondra to use Renewable Resources' name when contracting with Command Center and that the Branch Energy site was being managed by Kluver or leased by his company Little Knife. On December 21, 2016, Vondra entered into written agreements with Command Center in the name of Renewable Resources, the terms of which established the finance charge on balances that remained unpaid and an agreement to pay Command Center "all attorneys' fees, court costs and any other costs incurred in the process of collection" of unpaid balances.
[¶8] Command Center began providing temporary labor under its agreements with Renewable Resources in December 2016. Under Command Center policy, each Command Center laborer was required to have a work ticket signed by a supervisor confirming the performance of the requested work. The work tickets introduced at trial were signed by either John Ryan or Miles Vondra. The court found both Ryan and Vondra testified that the work performed by the Command Center laborers was performed at the Branch Energy site. Ryan and Dave Lees were employees of Renewable Resources and testified that they, along with Command Center laborers, were directed by Kluver to perform work at the Branch Energy site.
[¶9] In late December 2016, Courtney Grapentine, who is Kluver's daughter, began having Command Center laborers use an online time card application to designate the hours and the location of the work, which was forwarded to Command Center. The district court found the time cards for the Command Center laborers clearly showed that "all of the work" was performed at the Branch Energy site. The court further found that the work tickets, electronic time cards, and the testimony of Vondra, Ryan, Lees, and Michelle Horn, a Command Center branch manager, established that "all work" performed by the Command Center laborers was performed at and for the benefit of the Branch Energy site near Mandaree.
[¶10] The district court found that, while work was being done to make the Branch Energy site functionable, Kluver was negotiating with the owner of the treatment site for a lease agreement with an option to purchase. Under the terms of the draft lease, Kluver's limited liability company Little Knife was to be the lessee. The court also found that to offset the cost of the site cleanup performed by the Renewable Resources employees and Command Center laborers, the lease included various rent waivers and reductions in favor of Little Knife.
[¶11] In January 2017, Grapentine sent an email to Gary Pilgrim, the accountant for the owners of Renewable Resources, requesting payment to various vendors including Command Center. The district court found Grapentine did not mention to Pilgrim that Command Center labor was for the benefit of Branch Energy or that Kluver owned Little Knife. In February 2017, Horn visited the offices of Renewable Resources demanding Command Center be paid the $33, 423.12 due and owing for the services provided.
[¶12] The district court found that after some communications between Grapentine and Pilgrim, Pilgrim sent an email to Grapentine authorizing a $20, 000 payment to Command Center. On receipt of Pilgrim's email, a Renewable Resources check payable to Command Center for $20, 000 was signed by Kluver and delivered to Horn. The court found that Command Center remained due and owing the sum of $13, 423.12 and subsequently commenced the small claims court action against Renewable Resources.
[¶13] In November 2019, the district court entered its findings of fact, conclusions of law, and order for judgment. Because the case had been removed from small claims court, the court awarded Command Center its attorney's fees. In December 2019, the court entered an amended judgment. The amended judgment held Renewable Resources and Kluver jointly and severally liable to Command Center for $41, 254.29, plus post-judgment interest; held Kluver and Little Knife liable to Renewable Resources for $20, 000, plus interest from February 24, 2017; and held Kluver and Little Knife jointly and severally to indemnify Renewable Resources "for all damages, interest, attorney's fees, and costs" awarded to Command Center against Renewable Resources.
II
[¶14] Our standard of review after a bench trial in the district court is well established: In an appeal from a bench trial, the trial court's findings of fact are reviewed under the clearly erroneous standard of N.D.R.Civ.P. 52(a) and its conclusions of law are fully reviewable. A finding of fact is clearly erroneous if it is induced by an erroneous view of the law, if there is no evidence to support it, or if, after reviewing all the evidence, we are left with a definite and firm conviction a mistake has been made. In a bench trial, the trial court is the determiner of credibility issues and we do not second-guess the trial court on its credibility determinations.
Brash v. Gulleson, 2013 ND 156, ¶ 7, 835 N.W.2d 798 (quotation marks and citations omitted); see also Titan Mach., Inc. v. Renewable Res., LLC, 2020 ND 225, ¶ 7, 950 N.W.2d 149. The district court's findings of fact are "presumptively correct." Brash, at ¶ 10 (quoting Tweeten v. Miller, 477 N.W.2d 822, 824 (N.D. 1991)).
III
[¶15] At the outset, Kluver and Little Knife argue that the district court erred by entering judgment on a pleading that was never filed.
[¶16] Kluver and Little Knife assert that they raised applicable defenses in their answer to the third-party complaint that they filed in the district court, including the failure to state a claim upon which relief can be granted under N.D.R.Civ.P. 12(b)(6). They argue it was "plain error" for the district...
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