Camfield Tires, Inc. v. Michelin Tire Corp.

• Decision Date: 28 October 1983
• Docket Number: No. 82-1808,82-1808
• Citation: 719 F.2d 1361
• Parties: 37 UCC Rep.Serv. 1139 CAMFIELD TIRES, INC., Appellant, v. MICHELIN TIRE CORPORATION, Appellee.
• Court: U.S. Court of Appeals — Eighth Circuit

Page 1361

719 F.2d 1361

37 UCC Rep.Serv. 1139

CAMFIELD TIRES, INC., Appellant, v. MICHELIN TIRE CORPORATION, Appellee.

No. 82-1808.

United States Court of Appeals,

Eighth Circuit.

Submitted June 15, 1983.

Decided Oct. 28, 1983.

Hugh R. Kincaid, Kincaid, Horne & Trumbo, Fayetteville, Ark., James M. Micali, Asst. Gen. Counsel, Michelin Tire Corp., Lake Success, N.Y., for appellee.

William M. Cromwell, Rose, Kinsey & Cromwell, Fort Smith, Ark., for appellant.

Before BRIGHT and JOHN R. GIBSON, Circuit Judges, and HANSON, ^* District Judge.

JOHN R. GIBSON, Circuit Judge.

This case presents the troublesome issue of whether summary judgment may be granted when one of the parties after giving a deposition later files an affidavit with directly contrary statements. The question arises in an action filed by Camfield Tires, Inc., against Michelin Tire Corporation, which cancelled Camfield as a dealer. In Count I of its claim Camfield alleges that Michelin wrongfully terminated the dealership contract. In Count II Camfield alleges tortious interference with a business relationship. The district court ¹ granted summary judgment for Michelin on both counts. Camfield claims that Michelin is not entitled to summary judgment because there is a conflict in the evidence that requires determination by a finder of fact. We affirm the grant of summary judgment.

After Camfield's appeal was filed, we requested further briefing on the particular issue arising from the conflict between the deposition testimony of Glen E. "Pete" Camfield, the operating head of his corporation, and the affidavit he later filed.

Under the contract between Camfield and Michelin, Camfield was to make payment to Michelin in accordance with the terms of the invoices. Payment for all shipments made to Camfield on or before the 15th day of each calendar month were due on or before the 10th day of the following calendar month. Payment for all shipments made after the 15th day of each calendar month were due on or before the 10th day of the second calendar month. In January 1980 Camfield was past due in its account in the sum of $9,359.98 on invoices dating back as far as September 1979. The district court observed in its order that more than half this amount was ninety days past due.

The contract provided that "[s]ubmission of any negotiable instrument by Dealer shall not constitute payment until Michelin has collected the full amount thereof." On January 22, 1980, Camfield gave Michelin Sales Representative Wayne Busse a check, postdated February 15, 1980, in the amount of $9,359.98. Michelin attempted to have the check certified by Camfield's bank in Springdale on February 15, 1980, but the bank refused. Michelin then deposited the check for collection through normal banking channels and it was dishonored twice.

Pete Camfield in his deposition testified about Michelin's handling of the check:

They had a check from me, and they had been asked when I gave them the check to not deposit it until a certain date--I believe those instructions they followed.

Camfield Deposition at 27.

In his deposition Camfield also testified:

I'm not asking--I'm not saying that they deposited the check before they were supposed to. I'm not saying that. For no more time than there was, that is not of importance. I feel like the district manager did what I requested ....

Camfield Deposition at 43.

A year later, Pete Camfield filed an affidavit in which he recited:

That sometime in January of 1980, I delivered a check to Wayne Bussey [sic] which was dated for February 15th, 1980. This check was drawn on CAMFIELD TIRES, INC. and was made payable to MICHELIN TIRE CORPORATION and was in the sum of $9,359.98.

This check was given with specific instructions to Mr. Bussey [sic] to return the check to my place of business on February 15th, 1980 for payment in full. Further, the check was delivered with specific instructions not to attempt presentation of the check to the First National Bank of Springdale, Arkansas. Funds for payment of this check were located in a separate account and were to be supplied to Mr. Bussey [sic] upon presentation on February 15th, 1980.

However, Mr. Bussey [sic] never returned with the check and never presented the check for payment to CAMFIELD TIRES, INC., as per instructions. Rather, contrary to the instructions, the check was presented to the First National Bank of Springdale, Arkansas and was dishonored. If the check had been presented in accordance with the instructions, the check would have been paid on February 15th, 1980.

Camfield Affidavit at 1. At the same time, Camfield submitted the affidavit of his secretary to corroborate this version of the facts.

On April 23, 1980, Michelin cancelled the dealership agreement with Camfield. Camfield alleges that such cancellation violated the contract provision that permitted Michelin to terminate the agreement upon 120 days written notice and after the first anniversary date of the agreement, which would have been December 6, 1980. The district court observed that the account was still unpaid when the contract was cancelled and that more than half of the $9,000 account was over 180 days past due. It concluded that Michelin was justified under the circumstances in cancelling the agreement and that this right of cancellation existed separately from the 120-day notice provision in the contract. In granting summary judgment on both counts, the district court found that Pete Camfield's affidavit was "plainly implausible" and contrary to his sworn deposition testimony.

I.

Camfield contends that the district court erred in granting summary judgment for Michelin on Count I, wrongful cancellation, because a genuine issue of fact existed as to whether Michelin was justified in cancelling. Specifically, Camfield argues that the finder of fact should have been permitted to decide if the Michelin salesman followed Camfield's instructions in depositing the postdated check. At issue is whether Camfield instructed the salesman simply to delay the deposit, as Pete Camfield's deposition testimony indicates, or whether Camfield told the salesman not to deposit the check and to bring it back to him directly, as his affidavit later states.

Under Fed.R.Civ.P. 56(c), we may only sustain the entry of summary judgment "if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." Scherr Construction Co. v. Greater Huron Development Corp., 700 F.2d 463, 465 (8th Cir.1983). This court recognizes the drastic nature of the summary judgment remedy, finding it appropriate only if "the moving party has established his right to a judgment with such clarity as to leave no room for controversy and the non-moving party is not entitled to recover under any discernible circumstances." Butler v. MFA Life Ins. Co., 591 F.2d 448, 451 (8th Cir.1979). All evidence must be viewed in the light most favorable to the non-moving party. Adickes v. S.H. Kress & Co., 398 U.S. 144, 158-59, 90 S.Ct. 1598, 1609, 26 L.Ed.2d 142 (1970); Jackson v. Star Sprinkler Corp. of Fla., 575 F.2d 1223, 1226 (8th Cir.1978).

We must decide whether the conflict between Pete Camfield's affidavit and his earlier deposition testimony creates a genuine issue as to any material fact, thus precluding the entry of summary judgment for defendant under Rule 56. The circuits have reached differing results concerning the propriety of summary judgment in such circumstances. In Radobenko v. Automated Equipment Corp., 520 F.2d 540 (9th Cir.1975), the Ninth Circuit concluded that an issue of fact that arose from a conflict between a party's deposition and later affidavit was not a genuine issue but a sham. The court relied upon Perma Research & Development Co. v. The Singer Co., 410 F.2d 572, 578 (2d Cir.1969), in which the Second Circuit reasoned that allowing a party to submit a contradictory affidavit after giving a deposition would greatly diminish the utility of summary judgment as a procedure for screening out sham issues of fact. The Fifth Circuit reached a contrary result in Kennett-Murray Corp. v. Bone, 622 F.2d 887, 893 (5th Cir.1980). After carefully examining Rule 56 and cases decided under it, the court there concluded that a genuine issue can be raised by a party's affidavit even if it conflicts with the party's earlier deposition testimony.

Despite reaching a different conclusion, the Kennett-Murray court did not disagree with the central concern of the Radobenko and Perma Research courts that parties not thwart the purpose of Rule 56 by generating issues of fact through affidavits that contradict their own depositions. It described certain narrow circumstances under which a party's contradictory affidavit can raise a legitimate factual issue:

[T]he alleged inconsistency created by the affidavit existed within the deposition itself. Accordingly, the issue ... was appropriately raised by the deposition even without consideration of the affidavit.

Even assuming that the deposition was unequivocal, Bone's affidavit served to create a genuine issue which would preclude summary judgment. Bone's affidavit did not purport to raise a new matter, but rather to explain certain aspects of his deposition testimony. Bone stated that he was confused during the deposition.... Bone's assertion is at least plausible. A fair reading of the deposition reveals frequent shifts in the questioning ... with a degree of confusion on the parts of both Bone and the attorney.

The affidavit is not inherently inconsistent with Bone's earlier testimony.... Furthermore, the statement in the affidavit is not at odds with Bone's general theory of defense presented in the deposition.

622 F.2d at 894-95. Because the limited facts in Kennett-Murray suggested that the party did not file an...