WILLIAM H. STEELE, Chief District Judge.
The remaining parties have filed a total of seven motions for summary judgment. Briefing (including on the associated motions to strike) exceeds 900 pages. The Court therefore will address the motions piecemeal. This order addresses the threshold issue of what documents constitute the contract between the entity plaintiff ("the plaintiff")
Summary judgment should be granted only if "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). The party seeking summary judgment bears "the initial burden to show the district court, by reference to materials on file, that there are no genuine issues of material fact that should be decided at trial." Clark v. Coats & Clark, Inc., 929 F.2d 604, 608 (11
"When the moving party has the burden of proof at trial, that party must show affirmatively the absence of a genuine issue of material fact: it must support its motion with credible evidence . . . that would entitle it to a directed verdict if not controverted at trial. [citation omitted] In other words, the moving party must show that, on all the essential elements of its case on which it bears the burden of proof, no reasonable jury could find for the nonmoving party." United States v. Four Parcels of Real Property, 941 F.2d 1428, 1438 (11
"If the party moving for summary judgment fails to discharge the initial burden, then the motion must be denied and the court need not consider what, if any, showing the non-movant has made." Fitzpatrick, 2 F.3d at 1116; accord Mullins, 228 F.3d at 1313; Clark, 929 F.2d at 608.
"If, however, the movant carries the initial summary judgment burden . . ., the responsibility then devolves upon the non-movant to show the existence of a genuine issue of material fact." Fitzpatrick, 2 F.3d at 1116. "If the nonmoving party fails to make `a sufficient showing on an essential element of her case with respect to which she has the burden of proof,' the moving party is entitled to summary judgment." Clark, 929 F.2d at 608 (quoting Celotex Corp. v. Catrett, 477 U.S. 317 (1986)) (footnote omitted); see also Fed. R. Civ. P. 56(e)(2) ("If a party fails to properly support an assertion of fact or fails to properly address another party's assertion of fact as required by Rule 56(c), the court may . . . consider the fact undisputed for purposes of the motion . . . .").
In deciding a motion for summary judgment, "[t]he evidence, and all reasonable inferences, must be viewed in the light most favorable to the nonmovant . . . ." McCormick v. City of Fort Lauderdale, 333 F.3d 1234, 1243 (11
There is no burden on the Court to identify unreferenced evidence supporting a party's position.
The decedent was on site in connection with an April 2014 purchase order to install a sprinkler system ("the Purchase Order"). (Doc. 348-7 at 2-4). The parties agree that the Purchase Order forms at least part of the relevant contractual relationship between the plaintiff and S&S. No indemnity provision or insurance requirement appears within the four corners of the Purchase Order; the provisions on which the plaintiffs rely are contained within a Master Service Agreement executed in December 2008 ("the 2008 MSA"). (Doc. 182 at 6-8).
The Purchase Order addresses terms and conditions in several ways. First, the Purchase Order includes the following provision on its first page:
(Doc. 348-7 at 2). Second, the Purchase Order contains the following provision on its second page:
(Id. at 3). Third, the Purchase Order on its third page repeats verbatim the quoted provision appearing on its first page. (Id. at 4). Finally, the Purchase Order itself articulates several terms and conditions, addressing such matters as payment terms, emergency shipments, right to audit and compliance with governmental safety codes. (Id. at 2-3).
In its order denying the plaintiffs' previous motion for partial summary judgment as to Aspen, the Court tentatively concluded that construction of the Purchase Order is governed by Alabama law, based on evidence the Purchase Order was entered in Alabama for work to be performed in Alabama. (Doc. 349 at 4-5). "Alabama follows the traditional view that a contract is governed as to its nature, obligation, and validity by the law of the place where it was made, unless the parties intend the law of some other place to govern, or unless it is to be wholly performed in some other place." Ex parte Owen, 437 So.2d 476, 481 (Ala. 1983). No party has disputed that Alabama law governs construction of the Purchase Order; on the contrary, S&S acknowledges that "[t]he P.O. was prepared by GP in Alabama, sent to S&S in Alabama for work to be performed in Alabama." (Doc. 361 at 15). The Court therefore continues to employ Alabama law in construing the Purchase Order.
In construing a contract, the "threshold issue" is "whether the contract is ambiguous." Certain Underwriters at Lloyd's, London v. Southern Natural Gas Co., 142 So.3d 436, 453 (Ala. 2013) (internal quotes omitted). "The issue whether a contract is ambiguous or unambiguous is a question of law for a court to decide." American Resources Insurance Co. v. H & H Stephens Construction, Inc., 939 So.2d 868, 873 (Ala. 2006) (internal quotes omitted). "If the trial court determines that there is no ambiguity, it must determine the force and effect of the terms of the contract as a matter of law." Id. (internal quotes omitted). "A contractual provision is ambiguous if it is reasonably susceptible of more than one meaning." Doster Construction Co. v. Marathon Electrical Contractors, Inc., 32 So.3d 1277, 1283 (Ala. 2009) (internal quotes omitted). Conversely, "terms are unambiguous [when they are] susceptible of only one reasonable meaning." Id. (internal quotes omitted).
The plaintiffs and the insurer defendants focus their attention on the second provision, which mentions "Form 7141." S&S, however, argues that this provision never comes into play. Its argument proceeds as follows: To resolve an ambiguity between two seemingly inconsistent terms, a court must first attempt to reconcile the provisions. If that effort fails, the court must employ Alabama rules of construction, including the rule that the first stated provision controls over a later, inconsistent provision. Finally, if other rules of construction do not resolve the ambiguity, the court is to resolve the ambiguity against the drafter. (Doc. 361 at 15-17; Doc. 434 at 6-11). S&S applies its argument as follows.
The first and third provisions regarding terms and conditions need not be reconciled, since they are identical. S&S argues that the second provision should be reconciled with the others by requiring that the "Form 7141" referenced in the second provision be "signed by both Buyer and Supplier" as required by the first and third provisions, failing which the online terms and conditions will apply as stated in those provisions. S&S asserts that neither the 2008 MSA nor the 2011 amendment to the 2008 MSA (which extended its reach to all Georgia-Pacific subsidiaries, including the plaintiff) was signed by the plaintiff. S&S concludes that, even if "Form 7141" refers to the 2008 MSA, that MSA is not a written agreement signed by the plaintiff (the buyer under the Purchase Order) and S&S, with the result that the online terms and conditions control rather than those expressed in the 2008 MSA.
Should the Court reject that analysis and not require that the Form 7141 be signed by the plaintiff, S&S argues that the ambiguity introduced by the presence of two conflicting provisions regarding terms and conditions should be resolved in favor of the first provision, since it appears first in the Purchase Order, with the result that the online terms and conditions control. And should the Court reject that analysis, S&S proposes that the Court resolve the ambiguity by construing the Purchase Order against the plaintiff, as its drafter, and apply the online terms and conditions on that basis.
The Court has no quarrel with S&S's statement of Alabama law as far as it goes,
In its reply brief, S&S argues that "herein" refers only to the specific terms and conditions set forth in the body of the Purchase Order. (Doc. 434 at 9 n.6). Because the first and third provisions do not set forth any terms and conditions but only direct the reader to another (online) source of terms and conditions, S&S concludes that the second provision does not supersede them. This argument comes too late to be considered,
Focusing on a single word, S&S ignores the balance of the sentence, which eliminates S&S's spurious ambiguity. First, no language preceding "herein" restricts its reach to terms and conditions set forth in the Purchase Order as opposed to identified in the Purchase Order; the former construction is entirely S&S's invention. Second, the language following "herein" leaves no possible room for S&S's proposed construction, as it expressly states that, as a result of the supersession, the terms and conditions set forth in Form 7141 "apply as the terms and conditions for this purchase order." This language patently establishes Form 7141 as the exclusive source of terms and conditions governing the Purchase Order. Necessarily, then, all competing terms and conditions are superseded, whether set forth in the Purchase Order or referenced therein.
In summary, the Purchase Order unambiguously establishes "[t]he terms and conditions of Georgia-Pacific's Form 7141" as those governing the Purchase Order. S&S's arguments to the contrary are rejected for the reasons stated above.
The question becomes one of identifying "Form 7141." The plaintiffs describe the Purchase Order's reference to Form 7141 as incorporating that document by reference. (Doc. 348 at 17). The defendants disagree that the document incorporated was the 2008 MSA, but they do not dispute that the Purchase Order purports to incorporate some document by reference. When the identity of the document incorporated by reference is unclear but could reasonably refer to a proposed document, the contract's incorporation term is ambiguous. See Hyde v. Humana Insurance Co., 598 So.2d 876, 877, 880 (Ala. 1992) (where an insurance policy provided that approval of payment for a transplant would be "based on written criteria and procedures established by our Medical Affairs Department" but did not specifically refer to a document styled "Humana Health Care Division Transplant Coverage Criteria," the policy was ambiguous as to whether this document was incorporated).
Aspen and S&S assert that "Form 7141" cannot reasonably be read as intending the 2008 MSA because that document contains a footer reading "07141PO" rather than "7141" or "07141." (Doc. 348-4 at 4-9).
The plaintiffs argue that "Form 7141" under the Purchase Order unambiguously refers to the 2008 MSA. They note that Alabama law requires a court to construe all terms of a written instrument together and to reconcile all contractual provisions if possible. If the two documents are "read together as equals playing two different roles in the same one agreement," they say, any ambiguity melts away and it becomes clear beyond peradventure that the 2008 MSA supplies the terms and conditions governing the Purchase Order. (Doc. 408 at 19-24 & 20 n.6).
As certain defendants point out, the plaintiffs are placing the cart before the horse; they ask the Court to consider the 2008 MSA as part of the contract in order to determine that the 2008 MSA is part of the contract. They cite no authority that approves of such an approach,
Nor would consideration of the 2008 MSA remove the ambiguity. The plaintiffs find it dispositive that the 2008 MSA contemplates the issuance of future purchase orders. That, however, is what any MSA contemplates, as the plaintiffs' own authority notes,
The defendants identify two documents other than the 2008 MSA as potentially being the "Form 7141" identified in the Purchase Order: (a) a blank form 7141; and (b) an MSA entered in 2007 ("the 2007 MSA").
The field of potential candidates for "Form 7141" is thus limited to three contenders: the 2008 MSA; the 2007 MSA; and a blank form 7141. As between these three possibilities, the Purchase Order is ambiguous.
In its order denying the plaintiffs' previous motion for partial summary judgment as to S&S, the Court noted the general framework for resolving contractual ambiguities. (Doc. 349 at 7). First, "if the trial court finds the contract to be ambiguous, it must employ established rules of contract construction to resolve the ambiguity." Certain Underwriters at Lloyd's, London v. Southern Natural Gas Co., 142 So.3d 436, 454 (Ala. 2013) (internal quotes omitted). "If the application of such rules is not sufficient to resolve the ambiguity, factual issues arise . . . ." Id. "If one must go beyond the four corners of the agreement in construing an ambiguous agreement, the surrounding circumstances, including the practical construction put on the language of the agreement by the parties to the agreement, are controlling in resolving the ambiguity." Id. (internal quotes omitted).
The parties offer no relevant rules of construction for defining the ambiguous term, "Form 7141." The plaintiffs invoke three purported rules: (1) construe the contract as a whole; (2) consider the occasion giving rise to the contract, the relations of the parties, and the goal they sought to accomplish; and (3) consider the parties' course of performance and/or dealing. (Doc. 408 at 27-29). These items contribute nothing to the Court's analysis. By "contract as a whole," the plaintiffs mean the Purchase Order plus the 2008 MSA. (Id. at 27). That is, the plaintiffs again ask the Court to assume the 2008 MSA is part of the contract in order to find that it is in fact part of the contract, an argument that fares no better here than in Part II.A, supra. The other two proposed "rules" are not rules of construction (which focus on the contract language itself) but guides for the consideration of extrinsic evidence, as the plaintiffs' own authorities reflect.
Among the defendants, only S&S even mentions rules of construction, and it does so for the exclusive purpose, as discussed in Part I, supra, of showing that the provision mentioning Form 7141 does not control — not for the purpose of showing what "Form 7141" means. (Doc. 361 at 15-17).
Rather than applying rules of construction to identify "Form 7141," the parties proceed directly to the presentation of extrinsic evidence. Indeed, National expressly agrees that "there is a need to resort to extrinsic evidence to answer the `threshold question'" of "what is Form 7141." (Doc. 388 at 11). Because the parties do not effectively seek resolution of the ambiguity by resort to rules of construction, the Court proceeds to a consideration of the parties' extrinsic evidence.
In previous orders,
The Alabama Supreme Court has clarified that factual disputes resolvable only by the jury do not arise automatically upon the introduction of extrinsic evidence. Instead, "[i]f . . . there is no dispute concerning such factual questions, then the trial court should determine the meaning of the contract in light of the undisputed facts." Carroll v. LJC Defense Contracting, Inc., 24 So.3d 448, 455 (Ala. 2009). Thus, if all the extrinsic evidence is undisputed, resolution of the ambiguity continues to be a judicial function under Alabama law.
The Court's subject matter jurisdiction over this matter is based exclusively on diversity of citizenship. (Doc. 182 at 5). "It is well established in this Circuit that in diversity cases federal courts apply a federal rather than a state test for the sufficiency of evidence to create a jury question." Boeing Co. v. Shipman, 411 F.2d 365, 368 (5
For a contract term to be ambiguous, it must be reasonably susceptible of more than one meaning. Thus, if the extrinsic evidence rules out two of the three candidates for "Form 7141," the third, as the only remaining reasonable possibility, will necessarily prevail.
Based on the extrinsic evidence offered and the argument presented in support, "Form 7141" cannot reasonably refer to a blank form 7141.
National takes the lead in pressing for the 2007 MSA, and it is easy to see why: that MSA expressly establishes the minimum insurance limits for S&S as $3 million, a figure that (thanks to a quirk in National's policy) might eliminate its exposure. But to press the 2007 MSA into service, National is forced to take a tortuous, improbable route. The basic gist is this: (a) the 2007 MSA is a blanket, or nationwide, MSA; (b) the 2008 MSA (which was not initially a blanket MSA) then became a blanket MSA upon its 2011 amendment, such that its integration clause at that time extinguished the 2007 MSA; (c) a 2012 extension letter agreement ("ELA"), which extended the 2007 MSA until December 2012, then revived the extinguished 2007 MSA; (d) the revived 2007 MSA's integration clause then extinguished the 2008 MSA; (e) the revived 2007 MSA then expired in December 2012 pursuant to the ELA. The upshot, according to National, is that when the contracting parties entered the Purchase Order in April 2014, they necessarily invoked the 2007 MSA.
National's contractual argument suffers from multiple problems. First, National assumes rather than establishes that both MSAs are blanket agreements, as its supersession argument demands.
At the end of the day, it does not really matter whether National could support its supersession argument, because the argument does nothing to show that the parties intended to invoke the 2007 MSA when they used the term, "Form 7141." The best National can muster is an ipse dixit that "logic dictates that [the] MSA most recently in force [the 2007 MSA, under National's scenario] would be the controlling agreement," (Doc. 400 at 18), such that the Purchase Order's reference to Form 7141 "necessarily must be to the 2007 MSA" rather than to the 2008 MSA. (Doc. 340 at 20).
The logic of National's position is difficult to discern. As of January 1, 2013, the 2007 MSA was as dead a letter as National claims the 2008 MSA was. As National acknowledges, "[p]arties to an expired contract can continue to operate under that contract even after the termination date," (Doc. 400 at 18), so after 2012 the contracting parties were free to elect to operate under either terminated agreement.
It is uncontroverted that, between January 2013 and April 2014, the plaintiff and S&S entered seven purchase orders at the Naheola mill. (Doc. 348-5). Two of them — including the first of the seven — provided that "this work is to be performed per our agreement and rates on file in purchasing." (Id. at 4, 10). It is uncontroverted that the only agreement on file in purchasing at the Naheola mill was the 2008 MSA. (Doc. 348-1 at 55-56).
National's argument is all or nothing: the parties chose one or the other MSA to govern their post-2012 relations. The two purchase orders discussed above demonstrate that the parties chose the 2008 MSA and not the 2007 MSA. Thus, the reference of the other five purchase orders (including the Purchase Order) to "Form 7141" is also a reference to the 2008 MSA.
As noted, a contract term is ambiguous only if there are multiple reasonable meanings. As demonstrated in Parts II.C.1-2, the uncontroverted extrinsic evidence negates both a blank form 7141 and the 2007 MSA as reasonable meanings of the term "Form 7141" in the Purchase Order. Their elimination leaves only the 2008 MSA as a reasonable meaning, which resolves the ambiguity and requires that the Purchase Order be construed as incorporating by reference the terms and conditions contained in the 2008 MSA. As discussed below, construing "Form 7141" to reference the 2008 MSA is more than reasonable; it is inescapable.
That "Form 7141" in the Purchase Order refers to the 2008 MSA is shown by the contracting parties' contemporaneous, express identification of the 2008 MSA as "7141" when they entered the 2008 MSA, as discussed in Part II.A, supra. (Doc. 348-4 at 10-11). It is further shown by the parties' interchangeable use of "Form 7141" and "our agreement . . . on file in purchasing" in post-2012 purchase orders, where the latter unquestionably refers to the 2008 MSA, as discussed in part II.C.2, supra. A 2011 purchase order was even more pellucid, providing that "[a]ll work against this order is governed by the Master Service Agreement . . . dated December 15, 2008." (Doc. 369-1 at 41).
The defendants have identified no purchase orders involving work at the Naheola mill that used anything other than these three nomenclatures, and they have identified no evidence that the contracting parties' intent swung wildly, without rhyme or reason, between using the 2008 MSA and some different "Form 7141."
Certain defendants object that S&S did not subjectively understand that "Form 7141" meant the 2008 MSA. Even if this is so, it is irrelevant. "[T]he law of contracts is premised upon an objective rather than a subjective manifestation of intent approach." Harbison v. Strickland, 900 So.2d 385, 391 (Ala. 2004) (internal quotes omitted). The objective manifestations of intent discussed above establish beyond genuine dispute that the 2008 MSA is "Form 7141."
For the reasons set forth above, the plaintiffs' motions for summary judgment are
DONE and ORDERED.
Because the Court has not relied on the material to which objection is made, Aspen's motion to strike, (Doc. 428), is