Quality Equip. Leasing, LLC v. Ala. Logistics, LLC
| Decision Date | 28 September 2017 |
| Docket Number | Civil Action Number 2:17-cv-00127-AKK |
| Parties | QUALITY EQUIPMENT LEASING, LLC, d/b/a QUALITY EQUIPMENT SALES and CELADON TRUCKING SERVICES, INC., Plaintiffs, v. ALABAMA LOGISTICS, LLC, et al., Defendants. |
| Court | U.S. District Court — Northern District of Alabama |
This case arises out of a series of leasing agreements for trucks and trailers between Quality Equipment Leasing, LLC d/b/a Quality Equipment Sales and Celadon Trucking Services, Inc. (the "Plaintiffs/Lessors") and Alabama Logistics, LLC. Alabama Logistics defaulted on the leases and subsequently failed to return three leased trailers to the Plaintiffs. Those trailers were removed from the parking lot of the Alabama Logistics' headquarters building by Gregory Phillips, and Southern Property Management, LLC ("SPM") in October 2016. Phillips purportedly denied Alabama Logistics further access to the trailers after removing them from the company's parking lot. The Plaintiffs filed suit to recover the missing property, bringing claims for both breach of contract against Alabama Logistics, and conversion against Phillips and SPM. Over the course of this litigation, the Plaintiffs have regained possession of all but one of the purportedly converted trailers,1 and have now filed a motion for summary judgment, doc. 26, that is ripe and ready for review. After carefully considering the evidence before the court, and the Plaintiffs' brief, the court finds that the Plaintiffs' motion is due to be granted.
II. STANDARD OF REVIEW
Summary judgment is proper "if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." FED. R. CIV. P. 56(a). A dispute about a material fact is genuine "if the evidence is such that a reasonable jury could return a verdict for the nonmoving party." Anderson v Liberty Lobby, Inc., 477 U.S. 242, 248 (1986).
"The evidence of the non-movant is to be believed and all justifiable inferences are to be drawn in [her] favor." Id. at 255. It is expressly not the role of the court to "weigh conflicting evidence or to make credibility determinations." Mize v. Jefferson City Bd. of Educ., 93 F.3d 739, 742 (11th Cir. 1996); see also Anderson, 477 U.S. at 255 ().
However, "mere conclusions and unsupported factual allegations are legally insufficient to defeat a summary judgment motion." Ellis v. England, 432 F.3d 1321, 1326 (11th Cir. 2005) (per curiam) (citing Bald Mountain Park, Ltd. v. Oliver, 863 F.2d 1560, 1563 (11th Cir. 1989)). "[A] . . . 'scintilla of evidence in support of the nonmoving party will not suffice to overcome a motion for summary judgment.'" Melton v. Abston, 841 F.3d 1207, 1219 (11th Cir. 2016) (quoting Young v. City of Palm Bay, 358 F.3d 859, 860 (11th Cir. 2004)). Instead, if "the record taken as a whole could not lead a rational trier of fact to find for the non-moving party, there is no genuine issue for trial," and summary judgment is appropriately granted. Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986) (quoting First Nat'l Bank of Ariz. v. Cities Serv. Co., 391 U.S. 253, 289 (1968)).
Given that the Defendants have not responded to Plaintiffs' motion, the court notes that pursuant to Rule 56(e) of the Federal Rules of Civil Procedure "[i]f a party fails to properly support an assertion of fact or fails to properly address another party's assertion of fact," summary judgment is appropriate if the facts show "the movant is entitled to it." FED. R. CIV. P. 56(e)(3).
III. FACTS
The Plaintiffs began leasing trucks and trailers to Alabama Logistics in July 2015. Doc. 26-2 at 3. Overall, four lease agreements involving a total of five trucks and five Benson flatbed trailers were signed.2 All the lease agreements contained uniform language explaining that a default occurs when, among other things, "Lessee fails to pay when due any rent or any other payment under this Agreement." Id. at 8. The lease agreements also uniformly provided that, in the event of a default, the Lessor may "[t]erminate the Agreement . . . and require Lessee . . . to promptly return the Vehicles;" "[d]eclare [all] payments . . . due and payable by acceleration . . . as liquidated damages;" and require the payment of "expenses incurred by Lessor in enforcing its rights . . . [including] reasonable attorney's fees." Id. at 8-9.
In the fall of 2016, Alabama Logistics ceased making payments and defaulted on all four lease agreements. Doc. 26 at 3. Plaintiffs subsequently exercised their rights to terminate those agreements, and by October 31, 2016, all four leases had been terminated. Doc. 26-7 at 3. Prior to commencing this action, the Plaintiffs were able to recover almost all of their equipment, with the exceptionof three of the Benson flatbed trailers leased to Alabama Logistics on June 17, 2016. Doc. 26 at 3.
Greg Phillips, the owner of SPM, held the lease for Alabama Logistics' headquarters, where the trailers were kept. Doc. 26-9 at 5. Phillips asserts that the owner of the building warned Phillips that he would seize the trailers and other heavy equipment stored at the facility if Alabama Logistics continued to leave the vehicles in the building's parking lot. Id. at 6. When Phillips was unable to contact an Alabama Logistics representative, he moved the equipment, including the trailers, on his own. Id. at 6-7. Phillips testified that he did not have a lien over the equipment, and that he does not seek to claim any other form of ownership interest in the property. Id. at 11. Phillips concedes that Alabama Logistics never gave him permission to remove the trailers from the company's facility. Id. at 5-6, 10.
Over the course of this litigation, all three of the Defendants have consented to the issuance of a Writ of Seizure enabling the Plaintiffs to recover the missing trailers. Docs. 20; 22. Pursuant to these consent agreements, the court issued a Writ of Seizure, doc. 23, for the three unreturned trailers on March 14, 2017. Onetrailer, valued at $28,000, remains unrecovered as of August 9, 2017. Doc. 26 at 7.3
IV. DISCUSSION
In Alabama, to prevail on a breach of contract claim, the plaintiff must prove: "(1) the existence of a valid contract binding the parties in the action, (2) [the plaintiff's] own performance under that contract, (3) the defendant's nonperformance, and (4) damages." S. Med. Health Sys., Inc. v. Vaughn, 669 So. 2d 98, 99 (Ala. 1995). Here, the undisputed record evidence shows that all four of the required elements are met. There is no dispute that the lease agreements in question were valid, that the Plaintiffs' provided the trucks and trailers as agreed, and that Alabama Logistics failed to make the required payments under the lease. Indeed, Alabama Logistics entered into a consent order admitting that the Plaintiffs are the rightful owners of the three missing trailers pursuant to the parties' lease agreement, doc. 20 at 2, a tacit acknowledgement of the leases' validity. Alabama Logistics also does not dispute that its failure to make the required rental payments, and its failure to return leased equipment when requested, damaged thePlaintiffs. Accordingly, summary judgment is granted in favor of the Plaintiffs with respect to their breach of contract claim against Alabama Logistics.
The Plaintiffs request both actual and liquidated damages flowing from the breached lease agreements in the same amount, $74,583.75.4 The basic rule for contract damages in Alabama is that "'the damages awarded in an action for breach of contract should be an amount sufficient to return the nonbreaching party to the position [she] would have occupied had the breach not occurred.'" HealthSouth Rehab. Corp. v. Falcon Mgmt. Co., 799 So. 2d 177, 183 (Ala. 2001). Such damages must be "the natural and proximate consequences of the breach and such as may reasonably be supposed to have been within the contemplation of the parties at the time the contract was made." Aldridge v. Dolbeer, 567 So. 2d 1267, 1269-70 (Ala. 1990) (quoting Winslett v. Rice, 272 So. 2d 25, 31 (Ala. 1960)).
Had Alabama Logistics not breached the lease agreements, the Plaintiffs would have continued receiving rental payments for the duration of each lease. So, the appropriate measure of damages is simply for Alabama Logistics to make the rental payments it would have been obligated to pay until the leases wereterminated, an amount of $74,583.75, thereby placing the Plaintiffs in the position they would have occupied absent the breach.
However, the Plaintiffs' request for liquidated damages under the contract is denied. The amount requested as liquidated damages exactly duplicates the amount requested as actual damages because the Plaintiffs are not seeking to recover the full accelerated value of the leases at the time of default. Instead, the Plaintiffs seek only liquidated damages covering the time between default and termination of the lease agreements, and the lease agreements provide that liquidated damages are calculated in the same way as actual damages, i.e. via determining the value of the rental payments due and not paid under the lease. Docs. 26 at 5; 26-4 at 7. Consequently, an award of liquidated damages, in addition to actual damages, would amount to an impermissible double recovery for the same injury. See Turquoise Props. Gulf, Inc. v. Overmyer, 81 So. 3d 1250, 1255 n.3 (Ala. 2011) ().
Moreover, the liquidated damages provision at issue here is unenforceable under Alabama law, which only authorizes liquidated damages if they do not otherwise qualify as a penalty....
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