Opinion
2:22-cv-00581-HL
09-12-2023
NUFARM AMERICAS INC., an Illinois corporation, Plaintiff, v. DELTA RIDGE HOLDINGS, LLC, an Oregon limited liability company; and BRIAN JONES, Defendants,
FINDINGS AND RECOMMENDATION
ANDREW HALLMAN, UNITED STATES MAGISTRATE JUDGE
Plaintiff Nufarm Americas Inc. brings this action against Delta Ridge Holdings, LLC, and Brian Jones (collectively, “Defendants”). Plaintiff asserts claims for breach of contract, breach of guaranty, and unjust enrichment. Before this Court is Plaintiff's motion for summary judgment, ECF 29, which Defendants did not oppose. For the reasons discussed below, Plaintiff's motion for summary judgment should be GRANTED.
This Court has jurisdiction over this case based on diversity of citizenship between Plaintiff and Defendants. See 28 U.S.C. § 1332.
BACKGROUND
Nufarm Americas Inc. (“Nufarm” or Plaintiff) is the United States operating entity of an Australian parent company that manufactures and markets agricultural products around the world. Crawford Decl. ¶1, ECF 31. Delta Ridge Holdings, LLC (“Delta Ridge”) is based in Milton-Freewater, Oregon, and operates as a reseller of agricultural products. Jones Depo. 11, 19, ECF 30-3. Brian Jones (“Jones”) is the sole member of Delta Ridge and its sole employee. Id. at 16.
On November 22, 2019, Delta Ridge submitted a credit application (“Credit Application”) to Nufarm seeking trade credit from Nufarm to buy its products. Crawford Decl. ¶5; id. at Ex. 1, ECF 31-1. As part of the Credit Application, Delta Ridge agreed to pay all invoices within 60 days from date of the invoice. Id. On January 16, 2020, Nufarm granted Delta Ridge a $1.5 million line of credit. Id. at Ex. 2. As part of Nufarm's credit approval and agreement to extend credit of $1.5 million to Delta Ridge, Jones executed a personal guaranty on January 22, 2020 (“Personal Guaranty”), in which Jones “absolutely, unconditionally, and irrevocably” guaranteed Delta Ridge's debts to Nufarm. Id. Between March 3, 2020, and June 11, 2020, Delta Ridge ordered and received $995,556.70 worth of Nufarm products. Id. at ¶9; id. at Exs. 3-4. Delta Ridge paid $86,188.80, leaving $909,367.90 due and owing. Id. at ¶10; id. at Ex. 4.
On April 18, 2022, Plaintiff filed a complaint asserting three claims for relief: breach of contract, breach of guaranty, and, alternatively, unjust enrichment. Compl. 2-4, ECF 1. On May 25, 2023, Plaintiff filed a motion for summary judgment. Mot. Defendants' response to Plaintiff's motion was due on June 15, 2023, but no response was filed. On June 20, 2023, pursuant to Federal Rule of Civil Procedure 56(e)(1), this Court sua sponte granted Defendants fourteen (14) additional days to respond to Plaintiff's motion and notified all parties that, if no response was filed within fourteen days, this Court “will consider all of Plaintiff's well-supported facts as undisputed when ruling on Plaintiff's Motion for Summary Judgment.” Order, ECF 33 (citing FED. R. CIV. P. 56(e)(2)). Once again, Defendants filed no response.
LEGAL STANDARDS
I. Summary Judgment
Summary judgment is appropriate where the moving party “shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” FED R. CIV. P. 56(a). The moving party must establish the absence of a genuine issue of material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). If the moving party establishes the absence of a genuine issue of material fact, the nonmoving party can only defeat summary judgment by going beyond the allegations in the complaint to demonstrate a genuine issue for trial. Id. at 324.
Although the Court must construe the evidence in a light favorable to the non-moving party, Taylor v. List, 880 F.2d 1040, 1044 (9th Cir. 1989), the nonmoving party “must do more than simply show that there is some metaphysical doubt as to the material facts.” Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586 (1986). A party opposing a properly supported motion for summary judgment “may not rest upon the mere allegations or denials of his pleading, but . . . must set forth specific facts showing that there is a genuine issue for trial.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). “If a party fails to properly address another party's assertion of fact as required by Rule 56(c), the court may consider the fact undisputed for purposes of the motion [and] grant summary judgment if the motion and supporting materials-including the facts considered undisputed-show that the movant is entitled to it[.]” FED. R. CIV. P. 56(e)(2)-(3).
DISCUSSION
Plaintiff's motion for summary judgment argues that Defendants “bought nearly a million dollars of agricultural chemicals from Plaintiff . . . and did not pay for them.” Mot. 2. Plaintiff argues that it is entitled to judgment as a matter of law on its three claims and cites extensive evidence that Defendants failed to remit payment on products Delta Ridge purchased and received from Plaintiff. Id. at 4-9. This Court agrees and recommends that summary judgment be granted in favor of Plaintiff on its breach of contract and guaranty claims.
Because this Court finds that Plaintiff is entitled to summary judgment on its breach of contract and breach of guaranty claims, it is unnecessary to reach Plaintiff's alternative claim for unjust enrichment.
I. Breach of Contract
Under Oregon law, to establish a breach of contract claim, a plaintiff must allege and prove: (1) the existence of a contract, (2) its relevant terms, (3) the plaintiff's full performance and lack of breach, (4) the defendant's breach, and (5) resulting damages. Fleming v. Kids & Kin Head Start, 71 Or.App. 718, 721 (1985). A contract for sale of agricultural chemicals is a sale of goods and governed by Oregon's version of Article 2 of the Uniform Commercial Code. See Or. Rev. Stat. § 72.1020 (“Unless the context otherwise requires, this chapter applies to transactions in goods[.]”). Under ORS 72.2040(1), a contract for the sale of goods can be made in “any manner sufficient to show agreement, including conduct by both parties which recognizes the existence of such a contract.” Id.
Here, it is undisputed that Delta Ridge submitted the Credit Application to Plaintiff and that Plaintiff agreed, upon approval of the Credit Application, to sell and ship product to Delta Ridge on credit. It is also undisputed that Delta Ridge agreed to pay “all invoices” within 60 days from the date of the invoice. See Crawford Decl. Ex. 1 (Credit Application showing 60-day invoice payment terms under “Agreement” section and Jones' signature dated November 22, 2019). Thus, the record demonstrates that Delta Ridge was contractually obligated to pay Plaintiff for product that Delta Ridge ordered and received under the terms of the parties' agreement. See id. The record also shows that Plaintiff performed its obligations under the terms of the contract by shipping product to Delta Ridge on credit between March 2 and July 11, 2020. See id. at ¶9; id. at Exs. 3-4 (true copies of the underlying invoices and a true summary of Delta Ridge's order invoices from Nufarm). Despite Plaintiff's full performance under the terms of contract, Delta Ridge failed to pay all invoices on the products it received and therefore breached its obligation to Plaintiff. See id. As to the question of damages, Jones, as the sole member of Delta Ridge, acknowledged in his deposition that Delta Ridge owes $909,367.90 to Plaintiff for unpaid invoices. Jones Depo. 23. In fact, when Jones was asked in his deposition, “[i]s there any reason to believe that that amount [of $909,367.90] is not owed to [Plaintiff]?” Jones replied, “No.” Id.
In sum, the record clearly shows that Nufarm and Delta Ridge had a binding contract with specific terms, that Plaintiff performed its part of the contract, that Delta Ridge breached the contract, and that Plaintiff suffered damages in the amount of $909,367.90-and Defendants do not argue otherwise. Because Plaintiff has shown that there is no genuine issue of material fact regarding each of element of its breach of contract claim, Plaintiff is entitled to judgment as a matter of law on that claim.
II. Breach of Guaranty
Plaintiff is also entitled to summary judgment on its breach of guaranty claim. Jones signed the Personal Guaranty on January 22, 2020, and the terms of the instrument show that it is governed by Illinois law. See Crawford Decl. Ex. 2 at 3. Under Illinois law, “[a] guaranty is . . . an obligation in the alternative to pay the debt [of the principal debtor] if the principal does not.” JPMorgan Chase Bank, N.A. v. Earth Foods, Inc., 238 Ill.2d 455, 474 (2010). Furthermore, a guarantor's obligations may be triggered by a breach of contract by the principal debtor. See Village of Rosemont v. Lentin Lumber Co., 144 Ill.App.3d 651, 668 (1986). Last, “the liability of a [guarantor] is measured by the liability of its principal” under the contract at issue. Id.
Here, there is no dispute that Jones “absolutely, unconditionally, and irrevocably” guaranteed Delta Ridge's debts to Plaintiff, see Crawford Decl. Ex. 2, or that Delta Ridge owes Plaintiff a past due amount of $909,367.90, or that Jones has not paid Plaintiff for Delta's outstanding debt. See Jones Depo. 23. Because the record clearly demonstrates that Delta Ridge owes Plaintiff a debt of $909,367.90, and that Jones has failed to remit that amount to Plaintiff, Plaintiff is entitled to summary judgment on its breach of guaranty claim.
RECOMMENDATION
Plaintiff's motion for summary judgment, ECF 29, should be granted and judgment should be entered in favor of Plaintiff and against Defendants for $909.367.90.
SCHEDULING ORDER
The Findings and Recommendation will be referred to a district judge. Objections, if any, are due fourteen (14) days from service of the Findings and Recommendation. If no objections are filed, then the Findings and Recommendation will go under advisement on that date.
A party's failure to timely file objections to any of these findings will be considered a waiver of that party's right to de novo consideration of the factual issues addressed herein and will constitute a waiver of the party's right to review of the findings of fact in any order or judgment entered by a district judge. These Findings and Recommendation are not immediately appealable to the Ninth Circuit Court of Appeals. Any notice of appeal pursuant to Rule 4(a)(1) of the Federal Rules of Appellate Procedure should not be filed until entry of judgment.