Aircraft Inventory Corp. v. Falcon Jet Corp., Civ. Action No. 96-5350(MTB).

• Decision Date: 18 May 1998
• Docket Number: Civ. Action No. 96-5350(MTB).
• Citation: 18 F.Supp.2d 409
• Parties: AIRCRAFT INVENTORY CORPORATION, a North Carolina Corporation, Plaintiff, v. FALCON JET CORPORATION, a Delaware Corporation, Defendant.
• Court: U.S. District Court — District of New Jersey

18 F.Supp.2d 409

AIRCRAFT INVENTORY CORPORATION, a North Carolina Corporation, Plaintiff, v. FALCON JET CORPORATION, a Delaware Corporation, Defendant.

Civ. Action No. 96-5350(MTB).

United States District Court, D. New Jersey.

May 18, 1998.

David Kenneth DeLonge, Schumann, Hanlon, Doherty, McCrossin & Paolino, Jersey City, NJ, for Plaintiff.

Gregory C. Parliman, Pitney, Hardin, Kipp & Szuch, Morristown, NJ, for Defendant.

OPINION

BARRY, District Judge.

This matter comes before the court on a motion for summary judgment filed by defendant, Dassault Falcon jet Corporation ("Dassault Falcon Jet" or "defendant"), incorrectly referred to in the complaint as "Falcon Jet Corporation." Answer at 1. Defendant contends that both claims asserted by plaintiff Aircraft Inventory Corporation ("AIC" or "plaintiff"), namely breach of contract and promissory estoppel, must fail as a matter of law. This court agrees and, for the following reasons, defendant's motion will be granted.

I. STATEMENT OF THE CASE

Dassault Falcon Jet sells its own line of executive business jets and AIC buys, sells, leases and occasionally brokers aircraft. This dispute centers around an alleged oral contract between Dassault Falcon Jet and AIC — or, failing that, an alleged promise by Dassault Falcon Jet — regarding the sale of a Cessna Citation III, Serial Number 73 ("Citation III-73") for $3.1 million.

In the fall of 1993, Al Carrier, a regional manager for Dassault Falcon Jet, initiated negotiations with J.B. Scott concerning Scott's purchase of a new Falcon 900 jet from Dassault Falcon Jet and a trade-in of Scott's used Cessna Citation III-73 as part of the transaction. Carrier Dep. at 10, 11. In early 1994, Carrier informed Robert Morgan of Sacramento Aviation, a buyer, seller, and broker of aircraft and a friend of Carrier's for over 19 years, that Dassault Falcon Jet might be receiving a Citation III as a trade-in. Morgan Cert. ¶¶ 1, 2; Carrier Dep. at 22-23. Morgan told Carrier that he was very interested in inspecting the Citation III-73 and perhaps making an offer on it. Carrier Dep. at 23; Morgan Cert. at ¶ 2.

On May 16, 1994, Carrier flew to Boise, Idaho where the Citation III-73 was located, intending to show it to Morgan. Carrier Dep. at 23. Upon arriving at his hotel, Carrier was given a telephone message from Morgan stating that he would not be able to view the aircraft but that a man by the name of Gary Bannister, President of AIC, would be there instead. Id.; Morgan Cert. at ¶ 3.

On the morning of May 17, 1994, Bannister arrived from Florida and met with Carrier for the purpose of viewing the Citation III-73. Carrier Dep. at 23-25; Bannister Dep. at 42; Morgan Cert. at ¶ 3. Over breakfast, before even seeing the plane or its records, Bannister allegedly told Carrier that he was interested in buying the plane, but not interested in setting a market value on it. Bannister Dep. at 52. In other words, Bannister contends, he did not want his offer to be shopped around so that a slightly higher offer from someone else could eventually be obtained. Id. at 52-53. Bannister asserts that Carrier responded that he needed a "firm bid" so that he knew where he could sell the airplane once the Scott deal came together. Id. at 53.

Carrier and Bannister then drove to the airport to view the Citation III-73. Over a two hour period, Bannister examined the plane, the logbooks, the Cesscom report, and the service bulletins. Carrier Dep. at 25-26; Bannister Dep. at 55.

Bannister asserts that over lunch Carrier asked him to make an offer on the plane. Bannister Dep. at 56. Bannister also asserts that Morgan told him before he flew to Boise that Carrier had said that a $3.0 million offer on the Citation III-73 would "make the deal." Morgan Cert. at ¶ 4; Bannister Dep. at 48-49. As a result of what Morgan told him, Bannister offered to pay $3 million for the plane. Carrier allegedly replied, "I don't believe I can make that work. I need a little bit more." Bannister Dep. at 56. Bannister asserts that he then said, "Tell me what you need to put your deal together and I'll make you a non-shop price. In other words, I'll make you a price if you agree not to shop my offer." Id. Carrier allegedly responded, "I need 3.1 million to put my deal together" and Bannister then said, "I agree. I'll take it." Id. Carrier told Bannister to send a letter "accepting the airplane" to Neil MacDonald, Vice President of Marketing, and Bannister returned home. Id. at 57.

The next day, May 18, 1994, Bannister claims to have faxed a draft of his letter to Carrier's hotel room in Boise for his approval. Id. Carrier allegedly faxed it back to Bannister and said, "Gary they're all sitting in the office in New Jersey. They're waiting on your letter. We're going to go with your numbers. If we get the airplane bought, it's your airplane. If we get our deal, it's your airplane. But MacDonald wants you to change the letter and send it to Skip Flint." Id. at 58. Bannister then changed the addressee to Skip Flint, Director of Pre-Owned Aircraft Sales for Dassault Falcon Jet, and faxed the letter at around 5:00 p.m. or 5:30 p.m. on May 18, 1994. Id. The letter read as follows:

Dear Mr. Flint:

This is to confirm our personal contact with Al Carrier regarding the purchase of Citation III, 650-0073 by this company, Aircraft Inventory Corp.

Subject to the use of a purchase agreement, containing terms and language which is commonly acceptable in the aircraft industry. AIC wishes to offer this letter of intent for your consideration.

AIC will pay the amount of Three Million One Hundred Thousand Dollars, USD, (3,100,000.00).

Upon written notification from Falcon Jet, Inc. that the above aircraft will be available for delivery within 45 days, AIC shall place the amount of One Hundred Thousand Dollars ($100,000.00), in escrow with Morgan Aircraft Title Services, Inc. Such amount shall be dedicated to the purchase of this aircraft.

Falcon Jet would make the aircraft available for AIC to have a pre purchase survey completed at this time. The Survey and possible acceptance flight are to be conducted for the sole purpose of determining that the aircraft remains in a like condition as when first viewed by the representative of AIC on May 17, 1994.

We would appreciate hearing from you regarding this letter of intent as we do wish to include this transaction in our plans for a September purchase in 1994.

Sincerely,

/61s/61

Gary L. Bannister

President

Parliman Cert., Exh. 4 (hereinafter "May 19, 1994 Letter"). Flint did not respond to the letter, and believes he did not because the offer was not sufficiently attractive to warrant a response. Flint Dep. at 38.

Carrier recalls the events much differently. Carrier asserts that on May 17, 1994, when Bannister made the $3.0 million offer on the Citation III-73, Carrier simply inquired as to whether that was a fair price. Carrier Dep. at 33. When Bannister replied affirmatively, Carrier said that "if that's a fair price, then go a little bit higher and you'll probably get the aircraft. Because other offers would be coming in...." Id. Bannister then offered $3.1 million. Id. At no point, says Carrier, did he ever agree not to shop the offer or request a firm offer, Id. at 29-30, 34. Indeed, according to Carrier, he told Bannister that he was not authorized to accept or say anything about an offer, and to submit his offer to the pre-owned division of Dassault Falcon Jet. Id. at 34. While Carrier does not recall any conversation with Bannister regarding who to send the letter to, he states that "it's possible" that he told Bannister to initially direct the letter to MacDonald because he was Carrier's "direct boss," but that "it would have been a correct thing" to later tell Bannister to instead direct the letter to Flint. Id.

In any event, Carrier does not recall any conversations with Bannister after May 17. Id. at 36. Indeed, Carrier asserts that he never saw the May 18, 1994 letter directed to Flint — or any draft of the letter supposedly directed to MacDonald — until many months after it was received by Flint.¹ Id.

The next morning, May 19, 1994, Flint called Bannister's office and spoke with George Litchard, Bannister's associate at AIC. Bannister Dep. at 73; Litchard Cert. at ¶ 2. Flint supposedly confirmed to Litchard that Dassault Falcon Jet would not shop AIC's offer and if the Scott deal went through, AIC would get the Citation III-73. Bannister Dep. at 66-67; Litchard Cert. at ¶ 2. Flint did not speak with Bannister directly because Bannister was out of town, "probably looking at another Citation III." Bannister Dep. at 66. Flint concedes receiving the letter from Bannister on May 19, 1994 and recalls that he thereafter had a conversation with someone from AIC, but does not remember anything more than that a conversation took place. Flint Dep. at 5-6.

Finally, Morgan states that Carrier called and told him that Dassault Falcon Jet was accepting the $3.1 million offer of AIC and that "when [Dassault] Falcon Jet gets its deal, Aircraft Inventory gets the plane." Morgan Cert. at ¶ 3. Approximately one week later, Carrier again called, this time allegedly advising Morgan that the Scott deal had gone through and that the plane was committed to AIC. Id.

As one might expect because this lawsuit has been filed, AIC did not get the plane. On May 24, 1994, Scott signed a contract with Dassault Falcon Jet to purchase a Falcon 900 and trade in his Citation III-73. Carrier Dep. at 14-15. The day before, on May 23, 1994, Flint sent a memo to Jack Young, Senior Vice President of Finance for Dassault Falcon Jet, recommending that the Citation III-73 be placed on the market with a $3.8 million retail price and, if unable to retail, a $3.0 to $3.1 million wholesale price. Parliman Cert., Exh. 7.

In mid-June 1994, Dassault Falcon Jet placed an ad for the Citation III-73 in the Wall Street Journal. Parliman Cert., Exh. 8. According to...