Beeck v. Aquaslide 'N' Dive Corp.

562 F.2d 537 (8th Cir. 1977)

What's Going On?

Appellants seek review of an order granting summary judgment to Appellee in a personal injury action in which Appellee was granted leave to amend its answer in order to deny certain admissions contained within the answer.

Who's Who?

Appellants :

Jerry A. Beeck – injured while using a water slide manufactured by Appellant (original plaintiff).
Judy A. Beeck – wife of Jerry A. Beeck (original plaintiff).

Appellee    :

Aquaslide 'N' Dive Corporation – alleged manufacturer of water slide upon which Appellant Jerry A. Beeck suffered an injury (original defendant).

Facts:

Harker Wholesale Meats, Inc. sponsored a gathering at Kimberly Village Home Association of Davenport, Iowa. One year prior to the gathering, Kimberly Village had ordered and installed a water slide from a local distributor of Appellee Aquaslide 'N' Dive Corporation's products. Appellant Jerry A. Beeck was severely injured while using the water slide. The two insurance companies representing Harker and Kimberly Village concluded that the slide was manufactured by Appellee. Kimberly Village's insurer notified Appellee that it had manufactured the water slide. Appellee's insurer then investigated the slide and also concluded that the slide was manufactured by Appellee. Invoking diversity jurisdiction, Appellants filed a personal injury claim in federal court against Appellee, seeking to recover damages on theories of negligence, strict liability, and breach of implied warranty. Appellee answered the complaint, admitting that it designed, manufactured, assembled, and sold the slide in question. Approximately six and one-half months after the statute of limitations expired on Plaintiff's personal injury claim, the president and owner of Appellee made an on-site inspection of the slide in question and determined that it was not one of Appellee's products. Appellee then moved the district court for leave to amend its answer to deny manufacture of the slide. The district court granted leave to amend. The court entered summary judgment in favor of Appellee after a jury returned a verdict for Appellee on the issue of manufacture. Plaintiffs appeal.

Issue:

May a trial court, without abusing its discretion, grant a defendant leave to amend its answer in order to deny admissions made within that answer?

Decision:

Yes. FRCP 15(a) governs amendment of pleadings in civil actions. The Supreme Court has interpreted Rule 15(a) to mean that leave to amend the pleading should be “freely given” in the absence of any apparent or declared reason, such as undue delay, bad faith, or undue prejudice to the opposing party, on the part of the movant. The opposing party has the burden of proving undue delay, bad faith, or undue prejudice. The decision to allow a leave to amend is within the discretion of the trial court and is only reviewable for an abuse of discretion. In this case, the district court examined the record for evidence of bad faith, prejudice, and undue delay which might be sufficient to overcome the mandate of Rule 15(a). Because Appellant relied on the conclusions of three different insurance companies in its initial conclusion that it had manufactured the slide, it does not appear that Appellant acted in bad faith. The district court's conclusion that the amendment would not unduly prejudice Appellants was not an abuse of discretion—even though the statute of limitations had already run—because Appellants would have the opportunity to proceed against other parties involved in the chain of distribution of the slide upon which the injury occurred. There was no evidence of undue delay because Appellant and its insurer were sufficiently diligent in investigating the accident. Additionally, the district court did not abuse its discretion by holding a separate trial on the issue of manufacture because the separate trials served the interests of judicial economy. Affirmed.

Basic Rule:

A court may grant leave to amend an answer, without abusing its discretion, in the absence of any apparent or declared reason, such as undue delay, bad faith, or undue prejudice to the opposing party, on the part of the party seeking leave.

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