R.P. AIR, INC., et al., Respondents,
Cited by
- Great Gulf Corporation v. R.P. Air Inc. Minn. Ct. App. 2024
Authorities cited
Identified automatically; this list may not be exhaustive.
- Finden v. Klaas 128 N.W.2d 748
- Cummings v. Kelly Services & Indemnity Co. of North America 835 N.W.2d 472
- SHAMROCK DEVELOPMENT, INC. v. Smith 754 N.W.2d 377
- Roehrdanz v. Brill 682 N.W.2d 626
- Benchmark Computer Systems, Inc. v. London 417 N.W.2d 714
- Federal Home Loan Mortgage Corporation v. Gary E. Mitchell, John Doe 862 N.W.2d 67
- Enright v. Lehmann 735 N.W.2d 326
- Marriage of Sammons v. Sammons 642 N.W.2d 450
- Juelich v. Yamazaki Mazak Optonics Corp. 682 N.W.2d 565
- Sartori v. Harnischfeger Corp. 432 N.W.2d 448
- Thomas Oil, Inc. v. Onsgaard 215 N.W.2d 793
- Wick v. Wick 670 N.W.2d 599
- Pugsley v. Magerfleisch 201 N.W. 323
- Beede v. Nides Finance Corp. 296 N.W. 413
- 249 N.W.2d 12 not in our corpus
Opinion text
This opinion is nonprecedential except as provided by
Minn. R. Civ. App. P. 136.01, subd. 1(c).
STATE OF MINNESOTA
IN COURT OF APPEALS
A20-0721
R.P. AIR, INC., et al.,
Respondents,
vs.
Great Gulf Corporation,
Appellant,
Jane Doe, et al.,
Defendants.
Filed March 15, 2021
Affirmed in part, reversed in part, and remanded
Reyes, Judge
Anoka County District Court
File No. 02-CV-19-2421
Jacob B. Sellers, Greenstein Sellers, PLLC, Minneapolis, Minnesota (for respondents)
Erik F. Hansen, Elizabeth M. Cadem, Burns & Hansen, P A, Minneapolis, Minnesota (for
appellant)
Considered and decided by Worke, Presiding Judge; Reyes, Judge; and Jesson,
Judge.
NONPRECEDENTIAL OPINION
REYES, Judge
Appellant argues that the district court erred by concluding that it is not a party to
this lawsuit and therefore lacked standing to bring a motion to vacate the default judgment.
Appellant alternatively argues that the district court erred by concluding that, as a nonparty,
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appellant must intervene in the action in order to file its motion. Finally, appellant asks us
to reverse the district court’s denial of its motion to vacate because the default judgment is
void, the Finden factors1 support vacatur, and Minn. R. Civ. P. 55.01(d) requires reversal.
We affirm the district court’s determination that appellant is not a party, but reverse its
denial of appellant’s motion to vacate, and remand for further proceedings.
FACTS
This lawsuit is about the ownership of and interests in a Grumman HU-16C aircraft.
Appellant Great Gulf Corporation Delaware (GGC Delaware) asserts that it owns the
aircraft. Respondents Randolph Pentel and RP AIR, Inc., a company Pentel owns, named
and served a different entity, also named Great Gulf Corporation, with this lawsuit, seeking
an adjudication that respondents have all right, title, and interest in the aircraft. The district
court entered default judgment in favor of respondents . Upon learning of the judgment,
GGC Delaware filed a motion to vacate, which the district court denied. The following
facts describe the events leading to this lawsuit.
Background on GGC Delaware
GGC Delaware was incorporated in Delaware in July 2011. A document dated
October 17, 2012, which both parties agree is correct and authentic, states that William
Talford Graham is the sole director, names him president, and appoints Troy Wilson as an
“authorized representative and agent” of the corporation. A document of disputed validity,
1 The Finden factors are that the defendant: (1) “[has] a reasonable defense on the merits;
(2) has a reasonable excuse for his failure or neglect to answer”; (3) “has acted with due
diligence after notice of the entry of judgment”; and (4) shows absence of substantia l
prejudice to the opposing party. Finden v. Klaas, 128 N.W.2d 748, 750 (Minn. 1964).
3
dated February 25, 2013, purports to remove Graham from his roles and keep Wilson as an
authorized representative of the corporation. Under either document, Wilson is an
authorized agent of GGC Delaware; however, Graham purported to remove him during
this litigation. In March 2017, GGC Delaware was administratively dissolved for failure
to pay taxes or file a complete annual report. Wilson revived GGC Delaware in October
2019 after learning of this lawsuit.2
Background on the aircraft
GGC Delaware purchased the aircraft for $250,000 in September 2012. Wilson and
Graham registered the aircraft with the Federal Aviation Administration (FAA) in late 2012
and listed GGC Delaware’s address as 1717 McKinney Ave., Ste. 700, Dallas, TX 75202
(the Dallas address).
In June 2013, the aircraft flew from Anchorage , A laska, to the Anoka County
Airport for a stopover en route to Toronto, Ontario, Canada . However, for unknown
reasons, the aircraft never made the second leg of the journey to Toronto and has remained
at the Anoka County Airport since June 2013.
Key Aviation, which operated the Fixed Base Operation (FBO) facility at the Anoka
County Airport, stored the aircraft in one of its hangars. In February 2017, i t sold its
interests to Lynx FBO Twin Cities (Lynx), which stored the aircraft outside on the tarmac.
According to Lynx’s general manager M.A., by the time of this lawsuit, outdoor storage
had caused significant mechanical issues with the aircraft.
2 A Delaware corporation “whose certificate of incorporation has become forfeited or void”
may be revived at any time. See Del. Code Ann. tit. 8, § 312 (2018).
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Respondents attempt to locate the aircraft’s owner
Pentel became interested in the aircraft, so he looked up its registration number in
the FAA database and found that the record owner is a “Great Gulf Corp” at the Dallas
address. Property managers at the Dallas address said Great Gulf Corp no longer used that
property. Pentel found another Great Gulf Corp oration in Texas ( GGC Texas) with a
Corpus Christi address and registered agent M.B. Significantly, M.B. told Pentel that GGC
Texas never owned the aircraft or any other aircraft and that GGC Texas had been
dissolved.
In January 2019, Pentel met with M.A., who told him that Wilson had been the
contact person who paid the storage fees, but that fees had not been paid since May 2018.
M.A. told Pentel that Wilson did not own the aircraft, but managed it. Pentel emailed
Wilson asking about the aircraft and its owner. Wilson responded that he did not own it,
had managed it for a time, had been asked recently to return the aircraft to airworthiness
and to sell it, and that the “same company” still owned the aircraft. Pentel again asked for
the “name of the company and a telephone num ber for the person in charge.” Wilson
responded “that would be me” and asked about Pentel’s interest in the aircraft. Pentel did
not reveal his interest. Wilson and Pentel exchanged several additional emails, and Wilson
confirmed that a “Great Gulf” owned the aircraft. Eventually, Wilson stated that he
“need[ed] to know [Pentel’s] interest in the airplane before we can really continue.” Pentel
again did not reveal his interest in the aircraft but asked for the contact information for the
aircraft’s owner. Wilson did not respond.
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After this exchange with Wilson, Pentel continued searching for the Great Gulf
Corporation that owned the aircraft . His search confirmed the record owner as a Great
Gulf Corporation at the Dallas address with Wilson as its au thorized signing officer and
Graham as president.
Respondents purchase Lynx’s storage lien
Lynx obtained a statutory lien against the aircraft under Minn. Stat. § 345.10 (2018)
for unpaid storage fees of approximately $8,952.30. R.M. also had a mechanics lien in the
amount of $19,849.14 for maintenance performed on the aircraft in December 2013, but
he waived the lien because GGC Delaware paid him for that work .3 On or about May 1,
2019, Lynx assigned its lien to respondents.
Respondents commence this lawsuit and obtain a default judgment
In May 2019, respondents served GGC Texas at its Corpus Christi address .
However, the complaint lists the Dallas address associated with GGC Delaware.
Respondents sought adjudications that (1) GGC Texas abandoned the aircraft and it is
unclaimed property un der Minn. Stat. § 345.02 (2018); (2) respondents hold a valid lien
against the aircraft; (3) the district court direct and authorize sale of the aircraft to
respondents and declare them the rightful owners with all right, title, and interest in the
aircraft. The district court granted the motion for default judgment on September 12, 2019,
concluding that: (1) GGC Texas abandoned the aircraft; (2) respondents own a lien on the
3 R.M. also states that GGC Delaware owes him $5,040 for work done after December
2013. However, our review of the record reveals no evidence of a second lien.
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aircraft, and (3) respondents “are authorized to sell the Aircraft in a manner and price they
deem reasonable without notice to Defendants or any other party.”
GGC Delaware responds to the default judgment
GGC Delaware first learned of the default judgment on September 30, 2019. It filed
a motion to vacate on October 2 4, 2019 . Respondents filed a memorandum opposing
appellant’s motion to vacate along with an affidavit from Graham stating that (1) he
remains president and director of GGC Delaware; (2) Wilson has no authority to act on
behalf of GGC Delaware; and (3) GGC Delaware abandoned the aircraft. The district court
denied GGC Delaware’s motion to vacate, finding that it is not a named or served party to
the action . It determined that, although GGC Delaware “may have an interest in th is
lawsuit,” as a nonparty, it lacks standing to file a motion to vacate. This appeal follows.
DECISION
I. The district court did not clearly err by finding that GGC Delaware is not a
named or served party to this lawsuit.
GGC Delaware argues that, even though respondents did not serve it in this lawsuit,
it is named in the complaint, and the district court therefore clearly erred by finding that it
is not a party. We disagree.
Minn. R. Civ. P. 4 governs service of process to commence a civil lawsuit. One is
not made a party to an action until served under rule 4. In re Skyline Materials, Ltd., 835
N.W.2d 472, 476 (Minn. 2013) (discussing in-state service under Minn. R. Civ. P. 4.03) .
“Whether service of process was effective, and personal jurisdiction therefore exists, is a
question of law that we review de novo.” Shamrock Dev., Inc. v. Smith, 754 N.W.2d 377,
7
382 (Minn. 2008) (citing Roehrdanz v. Brill , 682 N.W.2d 626, 629 (Minn. 2004)).
However, whether a party is named in a complaint and served with process, apart from the
question of whether service of process was effective, are questions of fact. We review the
district court’s findings of fact for clear error. Roehrdanz, 682 N.W.2d at 631.
Here, the district court found that “while there are a myriad of disputed facts in this
case, one fact remains clear; Great Gulf Corporation, Delaware, is not, and has never been
a party to this lawsuit.” The district court did not clearly err by imp licitly finding that
listing an entity’s address does not make that entity a named party. And i t is undisputed
that respondents served GGC Texas but did not serve GGC Delaware. Quite simply,
respondents served the wrong party and therefore failed to make GGC Delaware, the record
owner of the aircraft, party to this lawsuit.4
GGC Delaware argues that, because respondents (1) listed its former Dallas address
in the complaint; (2) knew Wilson handled matte rs related to the aircraft; and (3) should
have known that GGC Delaware was the correct party, these facts make GGC Delaware a
party to the action. But GGC Delaware cites no authority for its proposition. We therefore
affirm the district court’s finding that GGC Delaware is not a party to this lawsuit.
4 To the extent the district court found that GGC Delaware did not exist, we note that a
dissolved entity may be served within three years of its dissolution. Benchmark Comput.
Sys., Inc. v. London, 417 N.W.2d 714, 71 6 (Minn. App. 1988) (citing Del. Code Ann. tit.
8, § 278, 279 (2018)) . This lawsuit commenced within three years of GGC Delaware’s
administrative dissolution on March 1, 2017 ; therefore, GGC Delaware could have and
should have been served.
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II. GGC Delaware has standing to file a motion to vacate as an interested nonparty
and without having to intervene.
GGC Delaware argues that, even if it is not a party, it has standing to file a motion
to vacate because the default judgment affects its property interest. It argues that the district
court therefore erred by determining that it first had to intervene in the lawsuit in order to
file its motion to vacate. We agree.
A. GGC Delaware has standing because it had an interest in the aircraft.
“We review de novo whether a party has standing.” Fed. Home Loan Mort. Corp.
v. Mitchell, 862 N.W.2d 67, 70 (Minn. App. 2015), review denied (Minn. June 30, 2015).
“Standing is a legal requirement that a party have a sufficie nt stake in a justiciable
controversy to seek relief from a court.” Enright v. Lehmann, 735 N.W.2d 326, 329 (Minn.
2007). A party has standing if it suffers an injury -in-fact, which is “a concrete and
particularized invasion of a legally protected interest.” Id. (citing Lujan v. Defs. of Wildlife,
504 U.S. 555, 560, 112 S. Ct. 2130, 2136 (1992)).
Here, GGC Delaware purchased the aircraft in 2012 , and it is undisputed that it
therefore had an interest in the aircraft. The default judgment gives respondents the right
to sell the aircraft “in a manner and price they deem reasonable without notice to . . . any
other party,” and therefore impairs GGC Delaware’s property interest. This constitutes a
concrete and particularized injury and confers standing on GGC Delaware to challenge the
default judgment as an interested nonparty.
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B. An interested nonparty need not intervene in a lawsuit in order to file a
motion to vacate a judgment that affects its interests.
Respondents concede that an interested nonparty need not intervene in order to bring
a motion to vacate a judgment that affects its interests, and we agree.
“[O]ne who is injured by the judgment, or who will be benefited by its reversal”
may appeal the judgment. Sammons v. Sammons, 642 N.W.2d 450, 456 (Minn. App. 2002)
(quoting 4 C.J.S. Appeal and Error § 156 (2002)5). An interested nonparty “[is] under no
obligation to intervene” and its failure to do so does not mean the district court may enter
a judgment against it. Id. at 457. Just as a party may appeal a judgment affecting its
interests, it may also bring a motion to vacate that judgment under Minn. R. Civ. P. 60.02.
Cf. Sammons, 642 N.W.2d at 456.
Here, the district court denied GGC Delaware’s motion to vacate, concluding that,
as a n onparty, it lacked standing to file the motion and implicitly concluding that GGC
Delaware must intervene in order to do so. But under Sammons, as an interested nonparty,
GGC Delaware need not have intervened to file a m otion to vacate the default judgment .
We therefore reverse the district court’s denial of GGC Delaware’s motion to vacate.
III. Because it lacked personal jurisdiction over GGC Delaware and therefore
could not adjudicate GGC Delaware’s interest in the aircraft, the district court
erred by failing to grant the motion to vacate the default judgment.
GGC Delaware argues that the district court erred by denying the motion to vacate
because the default judgment (1) is void under Minn. R. Civ. P. 60.02(d) for lack of
5 This quotation is now found in 4 C.J.S. Appeal and Error § 240 (2021). The language
has not materially changed.
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personal jurisdiction; (2) should be va cated under the Finden factors; and (3) should be
vacated because the district court failed to require respondents to file a bond before
obtaining default judgment under Minn. R. Civ. P. 55.01(d). GGC Delaware’s first
argument has merit.6
We review the district court’s denial of a motion to vacate for an abuse of discretion.
Roehrdanz, 682 N.W.2d at 631. However, w e review the legal question of whether
personal jurisdiction exists de novo. Juelich v. Yamazaki Mazak Optonics Corp. , 682
N.W.2d 565, 569 (Minn. 2014). The Fourteenth Amendment of the United States
Constitution and article I, section 7 of the Minnesota Constitution provide that
“government action may not deprive individuals of liberty or pr operty interests without
due process.” Sammons, 642 N.W.2d at 457 (citing Sartori v. Harnischfeger Corp. , 432
N.W.2d 448, 453 (Minn. 1988) (stating that due -process guarantees are the same under
both the state and federal constitutions) ); see also Grosjean v. Am. Press Co. , 297 U.S.
233, 244, 56 S. Ct. 444, 447 (1936) (stating that corporation is “person” for purposes of
due-process clause); Thomas Oil, Inc. v. Onsgaard , 215 N.W.2d 793, 79 6 (Minn. 1974)
(stating that corporation is person in context of Fou rteenth Amendment) . Due pro cess
requires, among other things, notice, a hearing, and “an opportunity to present evidence
and argument.” Sammons, 642 N.W.2d at 457 . These requirements are satisfied if the
plaintiff commencing a lawsuit “complies with an officially prescribed process for
6 Because we remand to the district c ourt to vacate the default judgment on the basis of
personal jurisdiction, we need not address appellant’s other two arguments. However, we
note that rule 55.01(d) clearly requires respondents to file a bond in this case, and the failure
to do so also merits vacatur.
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invoking the district court’s jurisdiction that . . . is reasonably likely to provide the
defendant with actual notice of the action.” Wick v. Wick, 670 N.W.2d 599, 603 (Minn.
App. 2003) (citing Wuchter v. Pizzutti, 276 U.S. 13, 18-19, 48 S. Ct. 259, 260 (1928)).
In Minnesota, the “officially prescribed process” is service of process under Minn.
R. Civ. P. 4. A judgment obtained without service of process on a party is void for lack of
personal jurisdiction and must be set aside regardless of the merits of the case. Pugsley v.
Magerfleisch, 201 N.W. 323, 323-24 (Minn. 1924); Beede v. Nides Fin. Corp. , 296 N.W.
413, 414 (Minn. 1941) (“A judgment entered without [] service of process is absolutely
void.”); see also Minn. R. Civ. P. 60.02(d) (stating that district court may relieve party of
final judgment if judgment is void) . Relatedly, “ [t]he district court may not exercise
jurisdiction over a nonparty.” Sammons, 642 N.W.2d at 457.
Here, the district court recognized that GGC Delaware had an interest in the aircraft
but unequivocally concluded that respondents never served GGC Delaware, and it was not
a party. It never acquired personal jurisdiction over GGC Delaware. The default judgment
is therefore void. See Beede, 296 N.W. at 414. On remand, we direct the district court to
vacate the default judgment.
IV. Other issues raised by the parties on appeal must be resolved by the district
court on remand.
The parties also dispute whether GGC Delaware continues to have an interest in the
aircraft, whether GGC Delaware abandoned its interest, and who has authority to act on
behalf of GGC Delaware. The district court’s findings are not clear on these issues, and
we are therefore unable to adequ ately review them. Rosenfeld v. Rosenfeld, 249 N.W.2d
12
168, 171 (Minn. 1976) (noting that sufficient findings are necessary to facilitate appellate
review). These issues are for the district court to resolve o n remand after vacating the
default judgment.
Affirmed in part, reversed in part, and remanded.