Opinion
No. 4-207 / 03-0966
Filed January 13, 2005
Appeal from the Iowa District Court for Cass County, Timothy O'Grady and Gordon C. Abel, Judges.
Anita Dairy appeals from the district court's grant of Allan Peterson's and Midwest Dairy's motion for summary judgment. AFFIRMED.
John Trewet of Rutherford, Trewet Knuth, Atlantic, for appellant.
Robert Laubenthal, Council Bluffs, and Andrew Hall and Anita Dhar of Grefe Sidney, P.L.C., Des Moines, for appellees.
Heard by Vogel, P.J., and Hecht and Vaitheswaran, JJ.
Anita Dairy appeals from the district court's grant of Allan Peterson's and Midwest Dairy Sales' motion for summary judgment. We affirm.
I. Background Facts.
Bill and Marsha Kragelund formed Anita Dairy, L.C. (Anita Dairy) when they started a dairy herd in 1993. In late 1995, Anita Dairy decided to expand its operation and consulted with Allan Peterson, owner of Midwest Dairy Sales (Midwest Dairy). Peterson recommended the services of Dairy Systems, Inc. (Dairy Systems) for the installation of new milking stalls. Peterson obtained, and Bill Kragelund approved, a price quote from James Kooiman, a principal of Dairy Systems. It was agreed that Dairy Systems would bill Midwest Dairy for its work and materials and that Anita Dairy would pay Midwest Dairy both for certain work performed by Dairy Systems and for any equipment supplied directly by Midwest Dairy in the project.
The work of Dairy Systems that was billed by Midwest Dairy did not include electrical work billed directly by Dairy Systems to Anita Dairy. This agreement as to the method of billing was reached as an accommodation to Anita Dairy to facilitate its financing of the project.
The old milking stalls were removed and the new stalls were installed by Dairy Systems in January of 1996. During the process, Dairy Systems disconnected the grounding wires in the barn and failed to reconnect them when installation of the new stalls was completed. Peterson was present during most of the construction but did not participate in the removal of the old or installation of the new stalls. Instead, he installed other pieces of equipment that he sold to Anita Dairy in connection with the project.
Shortly after it began to use the new stalls, Anita Dairy noticed its cows were consuming less feed, producing less milk, and exhibiting health problems. Several months later it was discovered that the cows were exposed to stray voltage because the electrical system in the dairy barn had been left ungrounded when the new stalls were installed. Anita Dairy consequently suffered substantial losses.
II. Procedural Background.
Anita Dairy brought suit against Dairy Systems, Kooiman, Midwest Dairy Sales, and Allan Peterson. Peterson and Midwest Dairy moved for summary judgment, contending all of Anita Dairy's damages stemmed from Dairy Systems' failure to reconnect the grounding wires. The district court agreed and granted the summary judgment. Anita Dairy's case against the remaining defendants proceeded to trial, and Anita Dairy prevailed. Anita Dairy now appeals from the grant of summary judgment in favor of Peterson and Midwest Dairy, contending Midwest Dairy and Peterson are liable for the negligence of Dairy Systems because Midwest Dairy acted as a general contractor in this case.
III. Scope and Standard of Review.
Our review of the grant of summary judgment is for errors at law. Gabrilson v. Flynn, 554 N.W.2d 267, 270 (Iowa 1996). We will review the record in the light most favorable to the nonmoving party. Dickerson v. Mertz, 547 N.W.2d 208, 212 (Iowa 1998). Summary judgment should only be granted when the moving party demonstrates that there is no genuine issue of any material fact and the moving party is entitled to judgment as a matter of law. Iowa R. Civ. P. 1.981.
IV. Discussion.
Anita Dairy contends the district court erred when it concluded, as a matter of law, that Midwest Dairy's relationship to Anita Dairy was simply as supplier and installer of equipment unrelated to the cause of Anita Dairy's damages. Anita Dairy asserts the summary judgment was improvidently granted because the record includes substantial evidence tending to prove Midwest Dairy acted as a general contractor in the transaction.
The determination whether an existing relationship gives rise to a duty is purely a question of law, yet the existence of that relationship is a question of fact properly reserved for the jury. See Clyde E. Williams Assocs., Inc. v. Boatman, 375 N.E.2d 1138, 1140 (Ind.Ct.App. 1978). The district court concluded "[t]here is no evidence before the Court that Plaintiff relied in any way on Midwest . . . to serve in the capacity of general contractor." We agree. We find no genuine issue of fact as to whether Midwest Dairy acted as a general contractor on the project, and therefore affirm the district court's ruling on the motion for summary judgment.
After a careful review of the record, we conclude the district court's summary judgment ruling was correct. Anita Dairy was damaged because its cows were exposed to stray voltage when the electrical circuit serving the milking equipment was not grounded as part of the installation of the new milking stalls. The uncontroverted evidence in the summary judgment record indicates Dairy Systems disconnected the electrical ground from the system when the old stalls were removed and failed to reconnect it after the new stalls were installed. The summary judgment record included the Kragelunds' deposition testimony documenting their expectation that Dairy Systems — not Midwest Dairy — would supply and construct the stalls. Moreover, the record also includes the Kragelunds' sworn testimony that they believed Dairy Systems — not Midwest Dairy — was responsible for the electrical work on the project. This testimony by the Kragelunds was supported by the direct billing for electrical services from Dairy Systems to Anita Diary.
Anita Dairy nonetheless contends the district court ignored other evidence in the summary judgment record supporting a finding that Midwest Dairy acted as a general contractor in this case. For example, Marsha Kragelund testified in her deposition that "[Peterson] was going to help and lead the way" in the installation of the new stalls and that Midwest Dairy provided Dairy Systems with the specifications to build the stalls. Bill Kragelund testified in his deposition that Peterson obtained the price quote on the dairy stalls from Dairy Systems and arranged and was present during the phone conversation between Anita Dairy and Dairy Systems when Dairy Systems was hired to remove the old stalls and provide and install the new ones. Bill Kragelund further testified that although Midwest Dairy never expressly represented it was acting as a general contractor, he believed Midwest Dairy was "a contractor" on the project. Mr. Kragelund explained this belief by noting that Midwest Dairy's "action of locating the company who manufactured and provided the stalls . . . implies that [it's] working as a general contractor to accomplish selling [its] used equipment in the process of the changeover." We conclude this testimony by the Kragelunds does not suffice to engender a genuine issue of material fact on the question of whether Midwest Dairy acted as a general contractor. Anita Dairy did not rebut Midwest Dairy's assertion that its billing included the charges on Dairy Systems only as an accommodation to Anita Dairy for purposes of financing the project. Moreover, Anita Dairy makes no claim that any of the work of Dairy Systems was supervised by Midwest Dairy. In fact, the Kragelunds made no claim at the summary judgment stage that Peterson and Midwest Dairy played a direct role in the removal of the old stalls or installation of the new ones; nor did the Kragelunds claim Peterson and Midwest Dairy played an indirect or supervisory role in the removal or installation of those fixtures. Perhaps more importantly, the Kragelunds conceded in their deposition testimony that Peterson and Midwest Dairy had no contractual obligation to perform the electrical work necessary to complete the project. Thus, the district court correctly determined the deposition testimony in the summary judgment record does not preclude summary judgment in favor of Peterson and Midwest Dairy.
One other part of the summary judgment record remains for our consideration. In his affidavit attached to Anita Dairy's resistance to the motion for summary judgment, Mr. Kragelund asserted that Anita Dairy relied "exclusively on [Midwest Dairy] to provide an upgraded milking system." We conclude the affidavit is insufficient, when taken together with the other information before the district court, to prevent summary judgment. A party resisting summary judgment "cannot create sham issues of fact in an effort to defeat summary judgment." American Airlines, Inc. v. KLM Royal Dutch Airlines, Inc., 114 F.3d 108, 111 (8th Cir. 1997). Mr. Kragelund's affidavit is inconsistent with the substance of his deposition testimony and that of Mrs. Kragelund as to the characterization of Midwest Dairy's involvement in the project. In particular, the depositions clearly establish that the Kragelunds did not exclusively rely on Peterson and Midwest Dairy to either to remove the old stalls and install the new ones or to perform the electrical work on the project. Accordingly, we conclude Mr. Kragelund's affidavit did not suffice to engender a genuine issue of fact. See Plymouth Foam Prods., Inc. v. City of Becker, 120 F.3d 153, 155 (8th Cir. 1997) (to the extent that the affiant's affidavit conflicts with his earlier deposition testimony, his affidavit should be disregarded). Accordingly, we conclude the district court correctly found no genuine issue of material fact and granted summary judgment in favor of Peterson and Midwest Dairy
In view of our disposition of this appeal, Anita Dairy's request for attorney fees is denied.