-RJJ Oakview Construction, Inc. v. Huffman Builders West, LLC et al, No. 2:2010cv00984 - Document 33 (D. Nev. 2011)
Court Description: ORDER Granting 21 Motion for Summary Judgment. Defendant Venture is dismissed from this case. Judgment will not be entered until all parties and all claims have been disposed of. Signed by Judge Edward C. Reed, Jr on 8/25/11. (Copies have been distributed pursuant to the NEF - MMM)
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-RJJ Oakview Construction, Inc. v. Huffman Builders West, LLC et al Doc. 33 1 2 3 4 UNITED STATES DISTRICT COURT DISTRICT OF NEVADA 5 6 7 8 OAKVIEW CONSTRUCTION, INC., an 9 Iowa corporation, Plaintiff, 10 11 vs. 12 HUFFMAN BUILDERS WEST, LLC, a Nevada limited liability company; 13 VENTURE CORPORATION, a California corporation; DOES I through X; 14 ROE CORPORATIONS I through X, 15 Defendants. 16 ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) 2:10-cv-00984-ECR-RJJ Order 17 This case arises out of an alleged breach of a construction 18 services contract. Plaintiff alleges five causes of action for: (i) 19 breach of contract against Huffman Builders West LLC; (ii) successor 20 liability against Venture Corporation; (iii) breach of implied 21 covenant of good faith and fair dealing against Huffman Builders 22 West LLC and Venture Corporation; (iv) unjust enrichment or, in the 23 alternative, quantum meruit, against all Defendants; and (v) 24 violation of Nevada Revised Statutes § 624. Venture Corporation has 25 filed a motion (#21) for summary judgment. The motion is ripe, and 26 we now rule on it. 27 28 Dockets.Justia.com I. Factual Background 1 2 Oakview Construction, Inc (“Oakview”) is an Iowa corporation 3 and licensed Nevada contractor doing business in Clark County, 4 Nevada. (Compl. ¶ 1 (#1 Ex. A).) Defendant Huffman Builders West 5 LLC (“Huffman”) is a Nevada limited liability company. (Id. ¶ 2.) 6 Huffman was the sole member of Hualapai Pavilion Commons LLC 7 (“Hualapai”). (Id.) Defendant Venture Corporation (“Venture”) is a 8 California corporation doing business in Clark County, Nevada. 9 ¶ 3.) (Id. On or about January 25, 2006, Oakview entered into a written 10 agreement with Hualapai to provide construction services for 11 Hualapai on property located at Hualapai Pavilions, 10115, 10135, 12 10155, 10175 and 10196 West Twain Avenue, and 3820 South Hualapai 13 Way, Las Vegas, Nevada (the “Project”). (Id. ¶ 5.) On or about May 14 24, 2006, Oakview entered into another written agreement with 15 Hualapai to provide additional construction services on the Project 16 (all construction services provided by Oakview under the agreements 17 hereinafter referred to as the “Work,” and the agreements 18 collectively referred to as the “Contracts”). (Id.) Oakview 19 asserts that during the course of Oakview’s performance under the 20 Contracts, Hualapai and Defendants issued change orders and work 21 orders to Oakview that expanded Oakview’s scope of work under the 22 agreements and materially changed the Work, increasing Oakview’s 23 costs to perform the Work. (Id. ¶ 6.) Hualapai failed to pay the 24 amounts due to Oakview under the Contracts. (Id. ¶ 8.) On November 25 20, 2006, Huffman agreed in writing to pay Oakview $498,155.58 of 26 the amount due under the Contracts in consideration of Oakview’s 27 continued performance of the Contracts and in order to facilitate 28 2 1 Huffman’s financing of the additional costs of the additional and 2 changed construction services outside of its construction loan for 3 the Project (the “Letter Agreement”). (Id. ¶ 9.) Pursuant to the 4 Letter Agreement, Oakview was entitled to payment at the time each 5 of the six buildings units of the Project was sold, on a pro rata 6 basis, based on the contract value of each unit. (Id.) In or about 7 March 2007, Oakview asserts that Venture purchased the assets and 8 certain liabilities of Huffman, including Huffman’s liabilities 9 under the Letter Agreement. (Id. ¶ 10.) Nearly all of the units of 10 the Project have now been sold or leased by Defendants. (Id. ¶ 11.) 11 Between September 2007 and July 2008, after Venture’s alleged 12 acquisition of Huffman, Oakview was paid $228,839.67 pursuant to the 13 terms and conditions of the Letter Agreement for the sale of certain 14 of the building units. (Id. ¶ 12.) Oakview asserts that it has 15 received none of the payments due in conjunction with the sale of 16 the remainder of the units. (Id. ¶ 12.) As of February 5, 2010, 17 the principal amount owing under the Letter Agreement was 18 $269,315.91 (the “Outstanding Balance”). (Id. ¶ 13.) 19 II. Procedural Background 20 21 Plaintiff filed its complaint (#1 Ex. A) in the Eighth Judicial 22 District Court in Clark County, Nevada on May 27, 2010. Venture 23 removed the action (#1) to this Court on June 22, 2010. Venture 24 filed its answer (#5) on June 29, 2010. On January 26, 2011, 25 Venture filed its motion (#21) for summary judgment. 26 opposed (#26) and Venture replied (#31). 27 now rule on it. 28 3 Plaintiff The motion is ripe, and we 1 2 III. Summary Judgment Standard 3 Summary judgment allows courts to avoid unnecessary trials 4 where no material factual dispute exists. N.W. Motorcycle Ass’n v. 5 U.S. Dep’t of Agric., 18 F.3d 1468, 1471 (9th Cir. 1994). The court 6 must view the evidence and the inferences arising therefrom in the 7 light most favorable to the nonmoving party, Bagdadi v. Nazar, 84 8 F.3d 1194, 1197 (9th Cir. 1996), and should award summary judgment 9 where no genuine issues of material fact remain in dispute and the 10 moving party is entitled to judgment as a matter of law. 11 CIV . P. 56(c). FED . R. Judgment as a matter of law is appropriate where 12 there is no legally sufficient evidentiary basis for a reasonable 13 jury to find for the nonmoving party. FED . R. CIV. P. 50(a). Where 14 reasonable minds could differ on the material facts at issue, 15 however, summary judgment should not be granted. Warren v. City of 16 Carlsbad, 58 F.3d 439, 441 (9th Cir. 1995), cert. denied, 116 S.Ct. 17 1261 (1996). 18 The moving party bears the burden of informing the court of the 19 basis for its motion, together with evidence demonstrating the 20 absence of any genuine issue of material fact. 21 Catrett, 477 U.S. 317, 323 (1986). Celotex Corp. v. Once the moving party has met 22 its burden, the party opposing the motion may not rest upon mere 23 allegations or denials in the pleadings, but must set forth specific 24 facts showing that there exists a genuine issue for trial. 25 v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). Anderson Although the 26 parties may submit evidence in an inadmissible form — namely, 27 depositions, admissions, interrogatory answers, and affidavits — 28 4 1 only evidence which might be admissible at trial may be considered 2 by a trial court in ruling on a motion for summary judgment. FED . 3 R. CIV. P. 56(c); Beyene v. Coleman Sec. Servs., Inc., 854 F.2d 4 1179, 1181 (9th Cir. 1988). 5 In deciding whether to grant summary judgment, a court must 6 take three necessary steps: (i) it must determine whether a fact is 7 material; (ii) it must determine whether there exists a genuine 8 issue for the trier of fact, as determined by the documents 9 submitted to the court; and (iii) it must consider that evidence in 10 light of the appropriate standard of proof. 11 248. Anderson, 477 U.S. at Summary judgment is not proper if material factual issues 12 exist for trial. B.C. v. Plumas Unified Sch. Dist., 192 F.3d 1260, 13 1264 (9th Cir. 1999). “As to materiality, only disputes over facts 14 that might affect the outcome of the suit under the governing law 15 will properly preclude the entry of summary judgment.” 16 477 U.S. at 248. Anderson, Disputes over irrelevant or unnecessary facts 17 should not be considered. Id. Where there is a complete failure of 18 proof on an essential element of the nonmoving party’s case, all 19 other facts become immaterial, and the moving party is entitled to 20 judgment as a matter of law. Celotex, 477 U.S. at 323. Summary 21 judgment is not a disfavored procedural shortcut, but rather an 22 integral part of the federal rules as a whole. Id. 23 24 25 IV. Defendant Venture’s Motion (#21) for Summary Judgment Venture asks the Court to dismiss Venture from this action in 26 its entirety with prejudice because: (i) no genuine issues of 27 material fact remain for trial; and (ii) Oakview has failed to state 28 5 1 a claim upon which relief may be granted because: (a) Venture does 2 not own any interest in the Project; (b) Venture did not acquire any 3 interest in or assets or liabilities of Huffman; (c) Venture is not 4 a successor in interest to the Letter Agreement; and (d) Venture did 5 not enter into any contracts with Oakview for the construction of 6 the Project. 7 Venture alleges that the sole member of Hualapai is Venture 8 Professional Centers, LLC (“VPC LLC”), a California limited 9 liability company qualified to do business in Nevada. (Mot. for 10 Summary Judgment at 4 (#21).) Venture claims that “Venture 11 Corporation” was a “trade name/dba” filed in approximately 1980 for 12 a California corporation named Venture Development Corporation, 13 which was formed in or about 1976 and subsequently underwent a name 14 change to Tamal Mt., Inc.. (Id.) Venture Development Corporation 15 d/b/a Venture Corporation was hired by Hualapai to act as project 16 manager and oversee the development, marketing and sale activities 17 for the Project. (Id. at 4-5.) In this role, Venture was not a 18 party to any contracts for the construction of the Project and had 19 no control over the Project’s funds. (Id. at 5.) Venture further 20 contends that it did not purchase Huffman, any of its assets or 21 liabilities, nor did it assume or succeed to any of Huffman’s 22 contract liabilities. (Id.) Venture also did not purchase, was 23 not assigned and does not own any interest in VPC LLC. 24 (Id.) For its part, Oakview contends that it was not aware of the 25 existence of VPC LLC until the start of the present litigation and 26 was under the impression that Venture had assumed the obligations of 27 the Letter Agreement. 28 (Resp. to Mot. for Summary Judgment at 3 6 1 (#26).) Oakview asserts that a genuine issue of material fact 2 exists as to whether Venture had apparent authority to make payment 3 under the Letter Agreement on behalf of Robert Eves and VPC LLC, the 4 successors in interest to membership interests in Hualapai. Oakview 5 believed that Venture had authority to perform under the Letter 6 Agreement and Venture actually caused payment to be made to Oakview 7 in accordance with the Letter Agreement. (Id. at 4.) 8 In Nevada, an agent binds a principal when it acts under 9 “actual . . . or apparent authority.” See Dixon v. R.H. Thatcher, 10 742 P.2d 1029, 1031 (Nev. 1987). Apparent authority is “that 11 authority which a principal holds his agent out as possessing[,] or 12 permits him to exercise or . . . represent himself as possessing, 13 under such circumstances as to estop the principal from denying its 14 existence.” Id. “Apparent authority is, in essence, an application 15 of equitable estoppel, of which reasonable reliance is a necessary 16 element.” Great American Ins. Co. v. General Builders, Inc., 934 17 P.2d 257, 261 (1997). “Apparent authority, including a third 18 party’s reasonable reliance on such authority, is a question of 19 fact.” Id. (emphasis in original). 20 Restatement (Second) of Agency notes that “apparent authority 21 is created when a principal writes, speaks, or acts in a way which 22 causes a third person to reasonably believe that the principal 23 consents to the acts fo the agent.” 24 § 27 (2005). Restatement (Second) of Agency Apparent authority is created where both the third 25 party and the principal know of the actions of the agent, and the 26 principal fails to object even though it could have easily done so. 27 Id. at § 43 cmt. e. 28 7 1 Venture contends that the existence of apparent authority is 2 not material to whether Oakview alleged a viable cause of action 3 against Venture. 4 We agree. (Reply to Mot. for Summary Judgment at 3 (#31).) Even if Venture had the apparent authority to make 5 payments under the Letter Agreement, Venture’s actions or inactions 6 as an agent with apparent authority would only be imputed to and 7 would only bind the principal, not Venture. Tsouras v. Southwest 8 Plumbing & Heating, 587 P.2d 1321, 1323 (1978)(holding that 9 “[a]pparent authority (when in excess of actual authority) proceeds 10 on the theory of equitable estoppel: it is, in effect, an estoppel 11 against the alleged principal to deny agency when by his own conduct 12 he has clothed the agent with apparent authority to act.”). Oakview 13 offers no authority to suggest that Venture would itself be bound to 14 make payments under the Letter Agreement as an agent of Huffman with 15 apparent authority. 16 (#26).) (Resp. to Mot. for Summary Judgment at 3 Oakview also does not assert that Venture executed any 17 contract or agreement on behalf of Huffman. (Id.) Rather, Oakview 18 appears to suggest that Venture was acting on behalf of either VPC 19 LLC or Robert Eves as principal, although neither party is named in 20 this lawsuit, and Venture offers no evidence that either party was 21 in privity of contract with Oakview with respect to the Contracts or 22 the Letter Agreement. 23 (Id. at 4.) Venture correctly states that a “mistaken belief does not 24 create a genuine issue of material fact.” 25 Summary Judgment at 6 (#31).) (Reply to Mot. for As the party opposing a motion for 26 summary judgment, Oakview has the burden of proof to offer 27 admissible evidence that Venture assumed or otherwise became 28 8 1 obligated to pay the remaining debt claimed by Oakview pursuant to 2 the Letter Agreement. 3 250 (1986). See Anderson v. Liberty Lobby, 477 U.S. 242, Here, Oakview has not offered any evidence as to how 4 Huffman’s obligations under the Letter Agreement became obligations 5 of Venture. The only evidence offered by Oakview is a series of 6 invoices sent to Venture and checks paid by Nevada Title Company to 7 Oakview as a pro rata payment from the sale of building units. 8 (Resp. to Mot. for Summary Judgment Ex. 2 (#26).) These checks 9 identify the seller as Huffman, not Venture, and do not provide any 10 evidence that Venture had assumed the obligations of Huffman under 11 the Letter Agreement. Oakview has, therefore, failed to present any 12 evidence to support its contention that there is a genuine issue of 13 material fact as to whether Venture assumed the obligations of the 14 Letter Agreement and so may be held liable for payments due Oakview 15 thereunder by the doctrine of apparent authority. 16 V. Conclusion 17 18 Venture has moved for summary judgment on the basis that: (i) 19 no genuine issues of material fact remain for trial; and (ii) 20 Oakview has failed to state a claim upon which relief may be 21 granted. Venture asserts that it does not own any interest in the 22 Project; (b) did not acquire any interest in or assets or 23 liabilities of Huffman; (c) is not a successor in interest to the 24 Letter Agreement; and (d) did not enter into any contracts with 25 Oakview for the construction of the Project. For its part, Oakview 26 contends that there exists a genuine issue of material fact as to 27 whether Venture assumed the obligations of the Letter Agreement 28 9 1 under the doctrine of apparent authority. We have found that such 2 an issue of material fact does not exist. 3 4 IT IS, THEREFORE, HEREBY ORDERED that Venture’s motion (#21) 5 for summary judgment is GRANTED and Defendant Venture is dismissed 6 from this case. 7 Judgment will not be entered until all parties and all claims 8 have been disposed of. 9 10 11 DATED: August 25, 2011. 12 ____________________________ UNITED STATES DISTRICT JUDGE 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 10
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