United States District Court, W.D. Missouri, Southern Division
FINDINGS OF FACT, CONCLUSIONS OF LAW, AND ORDER ON
MOTIONS TO SUBSTITUTE PARTIES AND SUPPLEMENT THE
ROSEANN A. KETCHMARK, JUDGE
diversity-jurisdiction case comes before the Court on the
action of Plaintiff Show Me Sunshine Properties, LLC
(“Show Me Sunshine”) for breach of a commercial
lease and unlawful detainer. (Doc. 25.) Prior to trial, the
Court granted partial summary judgment and dismissed Count I
of the Amended Complaint, which alleged that Defendant
BlueLine Rental, LLC (“BlueLine”) breached the
lease's “no-assignments” clause. (Doc. 80.)
The Court then held a bench trial on the remaining counts (II
and III), which seek damages and an eviction for altering the
property without consent and failing to keep the premises in
good repair. After trial, the parties submitted proposed
findings of fact and conclusions of law (Doc. 97; Doc. 103),
and Defendant filed corrected motions to supplement the
record and to substitute parties (Doc. 101; Doc. 102), which
Plaintiff opposes (Doc. 104; Doc. 105).
reasons below, BlueLine's motion to substitute parties is
DENIED; BlueLine's motion to supplement
the hearing record is GRANTED; on Count II,
the Court finds for BlueLine in part and Plaintiff in part
and assesses Plaintiff's damages at $0; and on Count III,
the Court finds for BlueLine.
Court has diversity jurisdiction under 28 U.S.C. § 1332.
When this action was filed, Show Me Sunshine was a limited
liability company with two members, Geoffrey and Brenda
Shaver. The Shavers were domiciled in either Florida or
Missouri. (Doc. 94, Trial Tr. at 21, 124-26.) BlueLine was a
limited liability company with one member, Vander
Intermediate Holding III Corporation. Vander Intermediate
Holding III Corporation was a Delaware corporation with its
principal place of business in Texas. (Doc. 85 at 1-2; Doc.
85-1; Doc. 85-2.) Accordingly, the parties are diverse.
See OnePoint Sols., LLC v. Borchert, 486 F.3d 342,
346 (8th Cir. 2007) (LLCs have the citizenship of their
members); Chavez-Lavagnino v. Motivation Educ. Training,
Inc., 714 F.3d 1055, 1056 (8th Cir. 2013) (diversity is
assessed at the time the action is commenced); Walker by
Walker v. Norwest Corp., 108 F.3d 158, 161 (8th Cir.
1997) (complete diversity rule). The disputed portion of the
lease (five years of monthly rent at $7500) also surpasses
the $75, 000 amount-in-controversy threshold. Therefore, the
Court has diversity jurisdiction.
Motion to Substitute Parties
requests to substitute United Rentals (North America), Inc.
(“United Rentals”) in its place as the defendant
because BlueLine merged into United Rentals after trial and
then terminated. (Doc. 102.) Plaintiff opposes the motion.
(Doc. 104.) Rule 25 of the Federal Rules of Civil Procedure
provides that “[i]f an interest is transferred, the
action may be continued by or against the original party
unless the court, on motion, orders the transferee to be
substituted in the action or joined with the original
party.” A merger constitutes a transfer of interests
under this rule. Luxliner P.L. Exp., Co. v. RDI/Luxliner,
Inc., 13 F.3d 69, 71 (3d Cir. 1993). The Court has
discretion over a motion to substitute parties.
Froning's, Inc. v. Johnston Feed Serv., Inc.,
568 F.2d 108, 110 n.4 (8th Cir. 1978).
Court sees little, if any, benefit to replacing BlueLine with
United Rentals. The primary purpose of substitution is to
“facilitate the conduct of the litigation.” 7C
Fed. Prac. & Proc. Civ. § 1958 (3d ed. 2019). This
is not a case in which substitution would avoid difficulties
in obtaining discovery from a non-party. Discovery has
closed; a trial has been held; and the case will be resolved
after the Court enters judgment. Furthermore, dismissing
BlueLine could raise unforeseen issues because, depending on
state law, it might be subject to an enforcement action
despite its termination, while United Rentals will have the
benefit of the Court's judgment either way. Id.
Seeing no practical benefit to substitution, the Court will
deny the corrected motion to substitute.
Motion to Supplement the Hearing Record
seeks to supplement the hearing record with evidence that (1)
BlueLine merged into United Rentals; (2) United Rentals
entered into a post-hearing contract for repairs of the
subject property with a company owned by Geoffrey Shaver
(Resort Installation Systems); and (3) evidence that
Plaintiff filed another lawsuit against United Rentals for
nonpayment of a single month's rent and then voluntarily
dismissed the case. (Doc. 101; Doc. 101-1; Doc. 101-2.) The
first and third categories of documents are official public
records that may be judicially noticed. See Couzens v.
Donohue, 854 F.3d 508, 513 n.6 (8th Cir. 2017)
(secretary of state records); Levy v. Ohl, 477 F.3d
988, 991 (8th Cir. 2007) (state court records). Regarding the
second category, Plaintiff opposes admitting the contract
documents on relevance grounds and due to a lack of
“contextual foundation as to what caused certain
documents to be created, actions to be taken and what led to
the existence/occurrence of those documents/actions.”
(Doc. 105 at 1.)
Plaintiff's use of the phrase “contextual
foundation, ” it does not argue that the contract is
hearsay or that it lacks authenticity. See Mueller v.
Abdnor, 972 F.2d 931, 937 (8th Cir. 1992) (a contract is
not hearsay when it is used to show its existence);
Williams v. Evangelical Ret. Homes of Greater St.
Louis, 594 F.2d 701, 704 (8th Cir. 1979) (authenticity
may be waived). The Court believes the post-hearing contract
is relevant to determining the extent of Plaintiff's
damages. Furthermore, the subject of the two-day bench trial
was the severity of the alterations and damages to the
property, if any. At the end of the trial, the Court
forecasted its ruling and found real damage to the property
in four areas. Additional context about what led the parties
to reach an agreement to fix the damages discussed at trial
is unnecessary for the Court to determine the pending claims.
Accordingly, the corrected motion to substitute the hearing
record will be granted.
16, 2012, Geoffrey and Brenda Shaver leased the property at
48 Industrial Park Drive, Hollister, MO 65672 (the
“Property”) to Volvo Construction Equipment
Rents, Inc. for the purpose of operating a construction
equipment rental business. At some point after the lease was
executed, Show Me Sunshine replaced the Shavers as the
lessor, and Volvo Construction Equipment Rents, Inc.
converted from a corporation to an LLC and changed its name
to BlueLine Rental, LLC.
lease provides for a five-year term. It also grants the
lessee two options to renew for additional five-year terms,
“[p]rovided that Lessee is not in default.” Any
violation of the terms of the lease is considered an event of
default. Paragraph 6 of the lease requires the lessee to
obtain the lessor's written consent to improve or alter
the building; paragraph 9.1 requires the lessee to
“[k]eep the Premises reasonably clean and free from all
rubbish, ashes, dirt and other matter;” and paragraph
9.2 requires the lessee to “maintain the Premises in
good repair, and in at least as good condition as ...