Streck, Inc. v. Ryan Family
297 Neb. 773
| Neb. | 2017Background
- Streck, Inc. sued Ryan Family, L.L.C. seeking specific performance of an option to purchase real property leased to Streck; Streck alleged it validly exercised the option and the L.L.C. breached by not closing.
- The L.L.C. is manager-managed; co-managers Wayne and Connie Ryan disagreed about litigation strategy, so a receiver was appointed to represent the L.L.C. in the suit.
- The receiver answered and counterclaimed that Streck was in default when it attempted to exercise the option, voiding the purchase right; Streck moved for partial summary judgment that it was not in default.
- Stacy Ryan (a ~20% nonmanaging member) filed a Complaint in Intervention seeking to intervene individually and derivatively on behalf of the L.L.C., alleging the receiver and managers were not adequately protecting the L.L.C.’s interests.
- The district court denied Ryan’s motion to intervene and denied her request to continue the summary judgment hearing; Ryan appealed the denial of intervention.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the order denying intervention is appealable | Streck: § 25-1315 requires express finality language, so denial is not final | Ryan: traditional final-order rule applies; denial of intervention is appealable | Denial of intervention is a final, appealable order; § 25-1315 does not supersede prior final-order jurisprudence |
| Whether Ryan may intervene in her individual capacity | Ryan: as a 20% member she will gain/lose financially and thus has a direct legal interest | Streck/L.L.C.: nonmanaging member lacks authority; financial impact alone is indirect and insufficient | No — membership interest and possible reduced distributions do not create the direct legal interest needed to intervene individually |
| Whether Ryan may intervene derivatively/on behalf of the L.L.C. | Ryan: L.L.C.’s only asset is at stake and the receiver/managers are not fully protecting the L.L.C., so she should intervene for its protection | Streck/L.L.C.: derivative rights have statutory procedures; Holmes exception limited and not met here | No — Ryan failed to allege the exceptional circumstances (e.g., total failure to protect corporate/LLC interests) necessary to intervene on behalf of the L.L.C. |
| Whether Ryan could expand the suit to challenge receiver appointment or managers’ conduct | Ryan: sought to challenge receiver appointment and managers’ breach of operating agreement via intervention | Streck/L.L.C.: intervention must be limited to core issues between original parties (lease/option dispute) | Court: such claims fall outside the scope of permissible intervention and cannot justify intervention here |
Key Cases Cited
- Ruzicka v. Ruzicka, 262 Neb. 824 (appellate standard on intervention and appeals jurisdiction)
- Spear T Ranch v. Knaub, 271 Neb. 578 (standing/intervention principles and final-order treatment of intervention denials)
- Steinhausen v. HomeServices of Neb., 289 Neb. 927 (members cannot sue individually for wrongs to the LLC; impact on distributions is insufficient)
- State v. Holmes, 60 Neb. 39 (exception allowing shareholder intervention where corporation utterly fails to protect shareholder interests)