General GMC Trucks, Inc. v. Mercury Freight Lines, Inc.

• Decision Date: 12 May 1983
• Docket Number: No. 82-8235,82-8235
• Citation: 704 F.2d 1237
• Parties: GENERAL GMC TRUCKS, INC. and General Leasing, Inc., Plaintiffs-Appellants, v. MERCURY FREIGHT LINES, INC., Defendant-Appellee.
• Court: U.S. Court of Appeals — Eleventh Circuit

Page 1237

704 F.2d 1237

GENERAL GMC TRUCKS, INC. and General Leasing, Inc. Plaintiffs-Appellants, v. MERCURY FREIGHT LINES, INC., Defendant-Appellee.

No. 82-8235.

United States Court of Appeals Eleventh Circuit.

May 12, 1983.

Kenneth L. Millwood, E. Kendrick Smith, Atlanta, Ga., for plaintiffs-appellants.

Thomas C. Shelton, Charles M. Dalziel, Jr., Atlanta, Ga., Marshall J. Demouy, Mobile, Ala., for defendant-appellee.

Appeal from the United States District Court for the Northern District of Georgia.

Before RONEY and HILL, Circuit Judges, and MORGAN, Senior Circuit Judge.

PER CURIAM:

This court, after thoroughly reviewing the record in this case, AFFIRMS on the basis of the order of the Honorable G. Ernest Tidwell, entered on March 18, 1982, Civil Action No. C.81-279A; attached hereto as an addendum.

NOTE: OPINION CONTAINS TABLE OR OTHER DATA THAT IS NOT VIEWABLE

ORDER

The above-styled matter is presently before the court on the defendant's motion for summary judgment. The defendant has filed a statement of undisputed material facts which is uncontroverted by the statement filed in response by the plaintiff, and therefore these facts are deemed to be admitted. Rule 91.72, Local Court Rules, United States District Court for the Northern District of Georgia. The facts which are not in dispute include the following.

Plaintiffs General GMC Trucks, Inc. (hereinafter "General GMC") and General Leasing, Inc. (hereinafter "General Leasing"), Georgia corporations headquartered in Atlanta, are authorized dealers of General Motors over-the-road tractors, trailers, and other trucking equipment used by motor carriers. Defendant Mercury Freight Lines, Inc. (hereinafter "Mercury"), an Alabama corporation headquartered in Mobile, is an interstate motor carrier operating throughout the Southeastern United States and Texas under certificates of public convenience and necessity granted by the Interstate Commerce Commission ("ICC") and by appropriate state regulatory agencies.

Early Rival Motor Express, Inc. (hereinafter "Early Rival") is a Georgia corporation that was organized in September, 1976 to operate as a motor carrier in Georgia and in interstate commerce under certificates of convenience and necessity issued by the ICC and the Georgia Public Service Commission. After Early Rival entered into a contract to purchase certain of the operating rights of Meadors Freight, Inc. (an Atlanta-based motor carrier which had been adjudicated a bankrupt in August, 1976), the company began in May of 1977 to operate over certain of the routes formerly serviced by Meadors Freight, the needed regulatory approvals having first been applied for and obtained on a temporary basis.

It is alleged by officers of the plaintiffs that prior to his death on November 14, 1977, Clarence Levi, the sole shareholder and president of defendant Mercury, entered into several oral arrangements on behalf of Mercury with agents of the plaintiffs, the purpose of which was to ensure the repayment of certain funds advanced by the plaintiffs to Early Rival, in the event that Early Rival or its president failed to repay the same. It is also alleged that Mr. Levi requested plaintiffs to lease trucking equipment to Early Rival as needed to supplement other equipment that Early Rival possessed, and that Mr. Levi promised to assume Early Rival's obligations under these leases in the event of a default by Early Rival. None of these alleged agreements were reduced to writing.

J.A. Sorrow served as the acting president of Mercury following the death of Clarence Levi and until June 9, 1980, when the new owner of Mercury made him president and chief executive officer. Mr. Sorrow is the only officer or agent of Mercury with whom any representative of the plaintiffs ever discussed Mr. Levi's alleged arrangements concerning Early Rival, and all of those discussions took place subsequent to Mr. Levi's death. After the death of Clarence Levi, the plaintiffs entered into additional lease agreements with Early Rival and made deliveries of substantial amounts of equipment to that company without seeking or receiving any approval from Mercury.

Sometime in 1981, Early Rival encountered serious financial difficulties and ceased direct operation of the routes it had acquired from Meadors Freight. By the time that this suit was initiated in 1981, the plaintiffs believed that Early Rival was insolvent. Plaintiffs have repossessed the leased equipment, and Early Rival is unable to conduct its motor carrier operations. The plaintiffs have never released Early Rival or its president from their obligation to pay the amounts claimed to be owed by Mercury in the complaint, and have made numerous efforts to collect on those obligations from those parties.

Upon a motion for summary judgment, this court may generally consider only evidence that would be admissible at trial. Roucher v. Traders & General Insurance Co., 235 F.2d 423 (5th Cir.1956); Super Valu Stores, Inc. v. First National Bank of Columbus, Georgia, 463 F.Supp. 1183 (M.D.Ga.1979). In a diversity action such as this, admissibility is determined by Georgia's rules of witness competency. Id.

The defendant first raises the issue that the plaintiff cannot make out a prima facie case since the testimony of Branch Mosely and William Holzwarth, who were respectively president and comptroller of plaintiffs General GMC and General Leasing at all relevant times hereto, is incompetent under the provisions of the Georgia Dead Man's Statute applicable to transactions occurring in 1976 and 1977. The pertinent provisions of this statute prohibit agents of surviving parties from testifying as to transactions or communications with a deceased agent of a corporation. Ga.Code Ann. Sec. 38-1603(3), (5) (1953); Allstate Insurance Co. v. Christian Brokerage Co., 145 Ga.App. 126, 127, 243 S.E.2d 281 (1978). Although these provisions were superseded by revised Ga.Code Ann. Sec. 38-1603 in 1979, the new Code section does not apply to transactions or occurrences which took place prior to July 1, 1979. Acts 1979, p. 1261, section 2. Accordingly, the court concludes that the...