Philips Credit Corp. v. Regent Health Group, Inc.
| Citation | 953 F.Supp. 482 |
| Decision Date | 31 January 1997 |
| Docket Number | No. 90 Civ. 2838 (DNE).,90 Civ. 2838 (DNE). |
| Parties | PHILIPS CREDIT CORPORATION, Plaintiff, v. REGENT HEALTH GROUP, INC. and Sugar Mill Point Medical Center, Ltd., Defendants. |
| Court | U.S. District Court — Southern District of New York |
Nixon, Hargrave, Devans & Doyle, New York City (Frank H. Penski and Kermitt J. Brooks, of counsel), for plaintiff.
Coudert Brothers, New York City (Darrell Prescott and Jeffrey M. Cohen, of counsel), for defendants.
This is a declaratory judgment action instituted by plaintiff commercial lender seeking a determination that it has no contractual obligation to make two loans to defendant based on alleged oral statements. In their answer to plaintiff's complaint, defendants raise six counterclaims in opposition to plaintiff's cause of action. Plaintiff moves this Court for summary judgment on their Complaint, and defendant opposes this motion on grounds that triable issues of fact exist on both plaintiff's cause of action and defendant's counterclaims. For the following reasons, this Court finds that plaintiff's motion should be granted in its entirety.
Plaintiff Philips Credit Corporation ("Philips" or "PCC") is "engaged in the business of commercial lending, but only in very limited markets." (Memorandum of Law of Philips Credit Corporation in Support of Motion for Summary Judgment, Philips Credit Corp. v. Regent Health Group, Inc., 90 Civ. 2838 ("Pltf.Memo") at 2 (Aug. 1, 1994)); see, (Complaint, Philips Credit Corp. v. Regent Health Group, Inc., 90 Civ. 2838 ("Complaint") ¶ 5 (April 27, 1990).) PCC is organized under the laws of Delaware, and has its principal place of business in New York, New York. (Complaint ¶ 1); see (Answer and Counterclaim, Philips Credit Corp. v. Regent Health Group, Inc., 90 Civ. 2838 ("Answer") ¶ 1 (June 29, 1990).)
Defendant Regent Health Group, Inc. ("Regent") is "engaged in the development, ownership and management of medical and surgical hospitals." (Affidavit of Brent W. Jorgeson, Philips Credit Corp. v. Regent Health Group, Inc., 90 Civ. 2838 ("Jorgeson Aff.") ¶ 2 (Sept. 29, 1990).) Regent, a Texas corporation headquartered in Austin, Texas, (Regent Health Group Inc.'s Memorandum of Law in Opposition to Philips Credit Corporation's Second Motion for Summary Judgment, Philips Credit Corp. v. Regent Health Group, Inc., 90 Civ. 2838 ("Dfts.Memo") at 2 (Sept. 28, 1994)), was formed in August 1988 by Brent W. Jorgeson ("Jorgeson"). (Jorgeson Aff. ¶ 3.) Jorgeson has served as Regent's Chairman and President since its founding. Id. ¶ 1.
Defendant Sugar Mill Point Medical Center, Ltd. ("Sugar Mill" or "SMPMC") was intended by Regent to be formed as a Texas limited partnership for the purpose of acquiring property in Houma, Louisiana, and constructing a hospital to be known as the Sugar Mill Point Medical Center. (Dfts.Memo at 9-10 & n. 11); (Pltf.Memo at 3); (Jorgeson Aff. ¶ 9.) The SMPMC project "was initiated by several physicians in the Houma area, including Dr. Barry Shelby, M.D. ("Shelby"), because [they] saw a need for a hospital in order to serve adequately the needs of their patients." (Dfts.Memo at 15.) Approximately twenty local physicians in the Houma area "committed to invest a total of approximately $1 million as limited partners as part of the equity for the project." (Dfts.Memo at 10.) According to Regent, "[a]ll elements of the SMPMC financing ... were planned to close concurrently with the closing of a loan from PCC." Id. Because "there was no closing on the PCC loan," however, SMPMC was never formed. Id.; (Jorgeson Aff. ¶ 9); see (Pltf.Memo at 3-4.)
Plaintiff commenced this diversity action in April 1990, seeking "a judgment declaring that there exists no valid, enforceable contractual obligation" between plaintiff and defendants. (Complaint, ¶¶ 4, 17.) Defendants filed an Answer containing six counterclaims on July 29, 1990. (Answer.) On August 17, 1990, prior to discovery, PCC moved for summary judgment on its complaint on the grounds that no triable issue of fact existed regarding the lack of contractual obligations between the parties. (Pltf.Memo at 15.) On November 12, 1991, this Court denied PCC's motion for two reasons: (1) the parties had not had opportunity to conduct discovery; and (2) genuine issues of material fact existed regarding several elements of both plaintiff's claim and defendants' counterclaims. Order, Philips Credit Corp. v. Regent Health Group, Inc., 90 Civ. 2838 ("November Order") at 1-2 (Nov. 12, 1991).
Following discovery, plaintiff requested this Court's permission to file a second motion for summary judgment pursuant to Federal Rule of Civil Procedure 56 ("Rule 56"). This Court granted plaintiff's request, (Pltf.Memo at 1); (Dfts.Memo at 7), and the instant motion was filed on August 22, 1994. (Notice of Motion, Philips Credit Corp. v. Regent Health Group, Inc., 90 Civ. 2838 (Aug. 22, 1994) ("Notice of Motion").)
The facts underlying plaintiff's motion are lengthy, detailed, and consist of numerous pieces of correspondence between the parties. For organizational purposes, this Court will recite the facts chronologically, in five parts: (1) defendants' preliminary financing efforts; (2) PCC and Regents' negotiations prior to the issuance of commitment letters; (3) PCC's first commitment letter; (4) events subsequent to the issuance of PCC's first commitment letter; and (5) PCC's second commitment letter.
In 1989, Shelby initiated a meeting with Jorgeson regarding the possibility of building a new hospital in Houma, SMPMC. (Deposition of Dr. Barry Shelby, M.D., Philips Credit Corp. v. Regent Health Group, Inc., 90 Civ. 2838 ("Shelby Dep.") at 7 (Mar. 26, 1993)); (Dfts.Memo at 15-16.) Jorgeson and Regent then prepared a financial plan for the development of SMPMC. (Jorgeson Aff. ¶ 15); (Dfts.Memo at 15.) Health Finance Corporation ("HFC"), an investment banking firm headquartered in Houston, Texas, "issued a commitment to provide $5 million to finance the purchase of medical equipment for SMPMC." (Jorgeson Aff. ¶ 15); (Dfts.Memo at 14-16.) In addition, by June 1989, approximately twenty Houma-area physicians had committed to invest a total of approximately $1 million as limited partners of the project. (Jorgeson Aff. ¶ 15); (Dfts.Memo at 10.)
Also in early 1989, Jorgeson and Regent were introduced to representatives of PCC as a result of the efforts of Veech Canon & Associates ("VCA"), a financial consulting firm specializing in the development of radiology/imaging departments for hospitals. (Jorgeson Aff. ¶ 16); (Dfts.Memo at 16); (Pltf.Memo at 4.) In May 1989, Jorgeson, Patrick McKinney ("McKinney"), a national sales manager of PCC, and representatives of VCA and HFC met to discuss whether PCC would be interested in providing all or part of the financing for SMPMC. (Jorgeson Aff. ¶¶ 16-17); (Dfts.Memo at 17); (Pltf.Memo at 4.) At the close of this meeting, McKinney stated that J. Walter Corcoran ("Corcoran"), the President of PCC, would need to make an on-site visit to Houma to investigate the SMPMC plan before a decision could be made by PCC regarding its decision to provide financing for SMPMC. (Jorgeson Aff. ¶ 17); (Dfts.Memo at 17.) On June 13, 1994, Corcoran, McKinney, Jorgeson, representatives of VCA and HFC, and thirteen of the physician partners of the SMPMC project met in Houma to discuss the project ("the June Meeting"). (Jorgeson Aff. ¶ 18); (Dfts.Memo at 17);
Following the June Meeting, Corcoran wrote to Jorgeson stating that PCC PCC required detailed financial information and documentation regarding Regent and the SMPMC project. (Letter from J. Walter Corcoran, President, Philips Credit Corp., to Brent W. Jorgeson, President, Regent Health Group, Inc. (June 21, 1989) ("June 1989 Letter").)
Regent provided PCC the information requested. (Jorgeson Aff. ¶ 19); (Letter from Brent W. Jorgeson, President, Regent Health Group, to J. Walter Corcoran, President, Philips Credit Corp. (July 3, 1989).) On July 7, 1989, Jorgeson and another Regent representative Steven Bell ("Bell") travelled to PCC's offices in New York to meet with McKinney "to negotiate the terms and conditions regarding the Sugar Mill transaction in Houma, Louisiana between Regent Health Care and PCC." (Memorandum to J. Walter Corcoran from W.G. Blieberg (June 29, 1989); (Jorgeson Aff. ¶ 20); (Dfts.Memo at 20.) According to defendants,
[b]y the end of the meeting, PCC and Regent had reached agreement on the major terms of the transaction. Mr. McKinney stated that the terms agreed to during that meeting would be presented to the PCC Credit Committee for approval, and that he and Mr. Corcoran had decided to recommend to the Credit Committee that PCC finance the entire project. Mr. McKinney stated that if the Credit Committee approved the transaction, that would constitute a "formal commitment" by PCC to do the transaction on those terms.
(Jorgeson Aff. ¶ 22); see (Dfts.Memo at 20.)
Defendants explain that that same day, Jorgeson and Bell also met with various individuals on PCC's Credit Committee. (Jorgeson Aff. ¶ 24); (Dfts.Memo at 22.). Jorgeson states that "[a]fter meeting with these individuals, Mr. Mckinney informed Mr. Bell and me that the project would be submitted to the PCC Credit Committee the following week and that, if approved, PCC would prepare a written document which would reflect the terms of the transaction as approved by the ...
To continue reading
Request your trial
-
Spencer Trask Software and Info. v. Rpost Intern.
...the contract unpersuasive, and the authority cited for this premise inapposite. See Pl. Op. at 37. In Philips Credit Corp. v. Regent Health Group Inc., 953 F.Supp. 482, 520 (S.D.N.Y.1997), the Court did not address the issue of the redundancy of a fraud and a breach of contract claim based ......
-
VFS Fin., Inc. v. Elias-Savion-Fox LLC
...‘governed by, and ... be construed in accordance with, the laws of the State of New York.’ ”); accord Philips Credit Corp. v. Regent Health Grp., Inc., 953 F.Supp. 482, 491 (S.D.N.Y.1997). The Court has independently analyzed whether the choice of New York substantive law was permissible, g......
-
Phx. Cos. v. Concentrix Ins. Admin. Solutions Corp.
...2018 WL 4757961, at *4 (S.D.N.Y. Sept. 30, 2018) (alterations in Exceed Holdings LLC ) (quoting Philips Credit Corp. v. Regent Health Grp., Inc. , 953 F. Supp. 482, 520 (S.D.N.Y. 1997) ); see also Perella Weinberg Partners LLC v. Kramer , 153 A.D.3d 443, 58 N.Y.S.3d 384, 390 (2017) ("To ful......
-
Treeline Garden City Plaza LLC v. UBS Warburg Real Estate Invs. Inc., 2004 NY Slip Op 50519(U) (NY 5/24/2004)
...See, Gruman Allied Indus., Inc. v. Rhor Indus., Inc., 748 F. Supp. 2d 729, 737 (2d Cir. 1984). See also, Philip Credit Corp. v. Regents Health Group, Inc., 953 F. Supp. 482 (SDNY 1997); and Pappas v. Harrow Stores, Inc., 140 A.D. 2d 501 (2nd Dept. 1988). Here, this Court finds that reliance......