Griffitts & Coder Custom Chopping, LLC v. CNH Indus. Am. LLC
| Decision Date | 06 February 2020 |
| Docket Number | Case No. 18-2300-DDC |
| Citation | 438 F.Supp.3d 1206 |
| Parties | GRIFFITTS & CODER CUSTOM CHOPPING, LLC, et al., Plaintiffs, v. CNH INDUSTRIAL AMERICA LLC, Defendant. |
| Court | U.S. District Court — District of Kansas |
Anne M. Kindling, Diane L. Bellquist, Joseph, Hollander & Craft, LLC, Topeka, KS, for Plaintiffs.
Patrick A. Edwards, Stinson Leonard Street LLP, Wichita, KS, Mark A. Samsel, Lathrop Gage, LLP, Overland Park, KS, for Defendant.
Plaintiffs Griffitts & Coder Custom Chopping, LLC ("Custom Chopping"), Bradley A. Griffitts ("Griffitts"), and Timothy L. Coder ("Coder," and collectively with Custom Chopping and Griffitts, "plaintiffs") assert breach of express and implied warranties and violations of the Kansas Consumer Protection Act ("KCPA") claims against defendant CNH Industrial America LLC based on alleged GPS and mechanical issues with five New Holland T8 tractors that defendant manufactured and plaintiffs leased. This diversity action arises under Kansas law.1
This matter comes before the court on defendant's Motion for Summary Judgment (Doc. 51). Defendant seeks summary judgment against each of plaintiffs' claims. Docs. 51 & 52. Plaintiff has filed a Response (Doc. 56), defendant has submitted a Reply (Doc. 59), and plaintiff has moved for leave to file a surreply (Doc. 62), attaching its Surreply to that motion (Doc. 62-1).2 The matter thus is fully briefed, and after considering the parties' arguments, the court is prepared to rule. For reasons explained below, the court grants in part and denies in part defendant's Motion for Summary Judgment.3
The following facts are either stipulated by the parties in the Pretrial Order (Doc. 50), uncontroverted, or, where controverted, are stated in the light most favorable to plaintiffs, the party opposing summary judgment. Scott v. Harris , 550 U.S. 372, 378, 127 S.Ct. 1769, 167 L.Ed.2d 686 (2007).
Custom Chopping is a Kansas limited liability company, with Griffitts and Coder as its only members. Griffitts and Coder also are the only members of G & C Farm Services LLC, a Kansas limited liability company ("Farm Services"). Farm Services is not a party to this suit. Neither Griffitts nor Coder own or operate a farming operation as an individual, a sole proprietorship, or with family members. And, they are not related to one another. Both Griffitts and Coder are Kansas residents.
Custom Chopping owns 335 acres near Muleshoe, Texas where it raises crops to sell. "Custom Chopping performs three primary services: (a) custom silage harvesting, which involves swathing, chopping, hauling, piling, and packing a particular crop; (b) custom swathing and hauling of straw; and (c) occasional trucking for other custom cutters and farmers." Doc. 52 at 6. The custom silage harvesting season for Custom Chopping runs from March to November. Its straw swathing season occupies the middle of summer.
The only service Farm Services provides is manure spreading. Its season runs from September to April. Farm Services is in the process of liquidating and closing its business, and last spread manure in December 2018 or January 2019.
Defendant CNH Industrial America LLC is a Delaware limited liability company. It sells New Holland brand agricultural equipment through authorized dealers throughout the United States, including through F & W Tractor Co., Inc. d/b/a AgriCenter ("AgriCenter"). AgriCenter is located in South Hutchison, KS.
Plaintiffs leased five New Holland tractors from Farm Credit Leasing Services Corporation d/b/a Ag Direct ("Farm Credit").4 The parties entered into the following agreements in connection with those leases:
Doc. 50 at 3–4. This Order refers to each of these Commercial Equipment Lease Agreements as a "Lease" and, collectively, calls them the "Leases." Each Lease contained four signatures for where "Lessee" manifested that it had accepted and agreed to the Lease. They were signed by "Lessee" Custom Chopping through its representatives Coder (as Vice President) and Griffitts (as President) and by "Lessee" Coder and "Lessee" Griffitts in their individual capacities. Those same parties signed again to confirm delivery of the equipment.
AgriCenter sold the tractors.6 As part of the lease transactions, AgriCenter created two Bills of Sale and each one identified Custom Chopping as the "Buyer," and Griffitts and Coder as a "Co-Buyer." The first Bill of Sale, dated January 23, 2016, covered the four 2016 tractors. The second Bill of Sale, dated March 21, 2016 (signed March 24, 2016), covered the 2015 tractor that was leased in March 2016. Doc. 52-3 at 4. Each one contained two signatures from plaintiffs. On the first Bill of Sale, Coder signed on the "Buyer" signature line, and Griffitts signed on the "Co-Buyer" signature line. On the second one, Griffitts signed on the "Buyer" signature line, and Coder signed on the "Co-Buyer" signature line. Only two signature lines appeared on these Bills of Sale—one for buyer and one for co-buyer.
The tractors have been used for three purposes only: (a) spreading manure for Farm Services, (b) swathing and hauling silage and equipment for Custom Chopping, and (c) mowing and maintaining land used by Custom Chopping as its Texas office, where it stores equipment and provides lodging for employees during the season. In short, the tractors never have been used for purposes unrelated to the business activities of Farm Services and Custom Chopping.7 Farm Services never paid Custom Chopping for using the tractors, nor does it have any contracts or other agreements with Custom Chopping.
Though the tractors were used by Farm Services, the above agreements never identify Farm Services as a buyer or lessee because it did not have an established credit rating like Custom Chopping. When shopping for the tractors and entering into the Leases, plaintiffs never raised the possibility of adding Farm Services as a co-buyer or lessee on the agreements.
By their individual signatures on the documents, Griffitts and Coder believed themselves to be joint owners, co-buyers, and co-lessees of the tractors, along with each other and Custom Chopping. According to Griffitts and Coder's understanding, they had equal ownership interests in the tractors8 and they were equally responsible for payments, regardless of who actually made the payments. The Leases were listed as joint installment debt on Griffitts and Coder's individual credit profile reports. The "Reasons" section of the credit reports included the following language, among other explanations: "Proportion of Loan Balances to Loan Amounts is Too High" and "Too Many Accounts with Balances." And, for each credit report, the installment balance as of the date of the report was greater than the combined total of the other account balances listed in the report.
Custom Chopping made all payments under the Leases. Also, Custom Chopping paid all non-lease expenses for the tractors. The lease expenses for the tractors were taken as deductions on Custom Chopping's tax returns, and the individual returns for Griffitts and Coder claimed no amounts derived from the tractors. Custom Chopping or Farm Services received all payments for work performed using the tractors. In other words, Griffitts and Coder did not make or receive any payments derived from the tractors' use; nor did they utilize the tractors when they filed their individual tax returns.
As explained in more detail below, some of plaintiffs' claims arise from Griffitts and Coder's inclusion as signing parties on the Leases and Bills of Sale. Neither Griffitts nor Coder asked to be identified as additional lessees or co-buyers in those documents. Lee File, the General Manager of AgriCenter, testified that he listed Griffitts and Coder as "Co-Buyers" on AgriCenter's Bills of Sale issued in connection with the Leases "because it was [his] understanding that Farm Credit required the individual business owners...to be identified on sale documents as co-buyers when the equipment was sold or leased to any entity (in this case...
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