Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

Travelers Casualty and Surety Company of America v. Guaranty Bank & Trust Co.

United States District Court, N.D. Iowa, Cedar Rapids Division

October 7, 2014

TRAVELERS CASUALTY AND SURETY COMPANY OF AMERICA, Plaintiff,
v.
GUARANTY BANK & TRUST COMPANY, Defendant.

RULING ON MOTION TO AMEND

JON STUART SCOLES, Magistrate Judge.

This matter comes before the Court on the Motion to Amend Its Answer and Assert Compulsory Counterclaims (docket number 14) filed by Defendant Guaranty Bank & Trust Company ("Guaranty Bank") on September 5, 2014, the Resistance (docket number 15) filed by Plaintiff Travelers Casualty and Surety Company of America ("Travelers") on September 18, and the Reply (docket number 17) filed by Guaranty Bank on September 25. Pursuant to Local Rule 7.c, the motion will be decided without oral argument.

I. PROCEDURAL HISTORY

On April 30, 2014, Travelers filed a complaint seeking judgment against Guaranty Bank. Acting in its capacity as the fidelity insurer of Newell Machinery Company, Inc., Travelers was required to pay Newell $232, 531.94 for losses incurred when a Newell employee converted for his own purposes checks payable to Newell. Travelers claims that the loss resulted from Guaranty Bank's failure to act in good faith and in accordance with reasonable commercial standards, and Guaranty Bank aided and abetted the employee's breach of fiduciary duty.

On July 2, 2014, Guaranty Bank filed its Answer, denying the material allegations and adding a laundry list of 14 affirmative defenses. On September 5, Guaranty Bank filed the instant motion, asking that it be permitted to amend its answer to include four additional affirmative defenses and two compulsory counterclaims. Travelers argues that the proposed amendments are untimely, and that the counterclaims are futile in any event.

II. DISCUSSION

FEDERAL RULE OF CIVIL PROCEDURE 15(a)(2) instructs the court to "freely give leave [to amend] when justice so requires." The United States Supreme Court has made it clear that "this mandate is to be heeded." Foman v. Davis, 371 U.S. 178, 182 (1962). A party does not, however, have an absolute or automatic right to amend. U.S. ex rel Lee v. Fairview Health System, 413 F.3d 748, 749 (8th Cir. 2005). Denial of leave to amend may be justified "by undue delay, bad faith on the part of the moving party, futility of the amendment, or unfair prejudice to the opposing party." U.S. ex rel Joshi v. St. Luke's Hosp., Inc., 441 F.3d 552, 557 (8th Cir.2006). Here, Travelers argues that the proposed amendments are untimely and, furthermore, the proposed counterclaims are futile.

A. Are the Proposed Amendments Timely?

On July 17, 2014, the Court adopted a proposed Scheduling Order and Discovery Plan submitted by the parties. The parties agreed to an August 29, 2014 deadline for amending pleadings. At Guaranty Bank's request, and with the consent of Travelers, the Court extended the pleadings deadline to September 5, 2014. The instant motion to amend was filed on the deadline established by the Court.

Travelers asserts that notwithstanding Guaranty Bank's compliance with the Court-ordered deadline for amending pleadings, the proposed amendments are untimely, citing Williams v. Little Rock Mun. Water Works, 21 F.3d 218 (8th Cir. 1984). The facts in Williams are clearly distinguishable from the instant action. In Williams, the plaintiff "filed her motion to amend her complaint some fourteen months after filing the original complaint, six days after the discovery cutoff date was set by the district court had passed and less than three weeks before the trial date." Id. at 224. Here, Guaranty Bank has complied with the pleadings deadline established by the Court, the discovery deadline is nearly six months away, and the trial ready date is more than ten months from now.

In claiming that the counterclaims are time-barred, Travelers also cites FEDERAL RULE OF CIVIL PROCEDURE 13(a)(1), which states:

A pleading must state as a counterclaim any claim that - at the time of its service - the pleader has against an opposing party if the claim:
(A) arises out of the transaction or occurrence that is the subject matter of the ...

Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.