Tremco Inc. v. General Transport & Consultants, Inc.

Ariz.App. Div. 1,2008.

Notice: THIS DECISION DOES NOT CREATE LEGAL PRECEDENT AND MAY NOT BE CITED EXCEPT AS AUTHORIZED BY APPLICABLE RULES. See Ariz. R. Supreme Court 111(c); ARCAP 28(c); Ariz. R.Crim. P. 31.24.

Court of Appeals of Arizona,Division 1, Department E.

TREMCO INCORPORATED, an Ohio corporation, Plaintiff/Appellee,

v.

GENERAL TRANSPORT & CONSULTANTS, INC., an Ohio corporation, Defendant/Appellant.

May 15, 2008.

Appeal from the Superior Court in Maricopa County; Cause No. CV2006-014232; The Honorable Edward O. Burke, Judge. AFFIRMED.

Alvarez & Gilbert, PLLC by Donald R. Alvarez, Scottsdale, Attorneys for Plaintiff/Appellee.

Gordon & Rees LLP by Stephen W. Tully, Phoenix, Attorneys for Defendant/Appellant.

MEMORANDUM DECISION

PORTLEY, Judge.

1 General Transport & Consultants, Inc. (“General”) challenges the summary judgment granted to Tremco Incorporated. For the following reasons, we affirm.

FACTS

2 Tremco hired General in 2004 to move a truckload of Tremco’s products from Ohio to California. General then brokered  the load to Seaboard Products, Inc. (“Seaboard”), and Seaboard brokered the load to Value Truck (“Value”), an Arizona corporation.

We use the term “broker” to refer to an agreement that includes a delegation of the duty to transport a shipment.

3 Value took possession of Tremco’s product. Value refused to deliver the shipment until the $4,800 debt Seaboard owed was paid in full. Tremco demanded the return of its product, but Value refused to release it.

4 Tremco filed suit against General and Value in September 2006. It claimed that General was liable for breach of contract and Value was liable, among other things, for conversion. After Value failed to file a timely answer, the court entered a default judgment against Value for $79,674.16.

5 In February 2007 Tremco filed a motion for summary judgment against General. After oral argument, the court granted Tremco’s motion and entered a judgment in favor of Tremco for $49,382.16. General appeals, and we have jurisdiction pursuant to Arizona Revised Statutes (“A.R.S.”) sections 12-120.21(A)(1) (2003) and 12-2101(B) (2003).

DISCUSSION

6 General contends that the court erred in granting Tremco’s motion for summary judgment. We review a trial court’s grant of summary judgment de novo. See Orfaly v. Tucson Symphony Soc’y, 209 Ariz. 260, 263, ¶ 8, 99 P.3d 1030, 1033 (App.2004). A trial court may grant summary judgment if “there is no genuine issue as to any material fact” and the movant “is entitled to judgment as a matter of law.”Ariz. R. Civ. P. 56(c)(1).

7 A shipment of goods that is moved between two states is subject to the Carmack Amendment to the Interstate Commerce Act (“the Act”).See49 U.S.C. § 13501(1)(A) (2007). Under the Act, a carrier is liable for loss or injury to shipped property. Id. § 14706(a)(1) (2007). All state law breach of contract claims are preempted by the Act. See Hall v. N. Am. Van Lines, Inc ., 476 F.3d 683, 688-89 (9th Cir.2007).

8 To establish a prima facie case under the Act, a shipper must establish: (1) that the goods were delivered in good condition to the carrier; (2) that the goods arrived in a damaged condition; and (3) the amount of damages.John Morrell & Co. v. Frozen Food Express, Inc., 700 F.2d 256, 258 (5th Cir.1983) (citation omitted). The shipper does not need to specifically mention the Act in its pleading to raise a claim under the Act as long as it establishes the proper elements. See Nichols v. Mayflower Transit, LLC, 368 F.Supp.2d 1104, 1110 (D.Nev.2003); Mayflower Transit, Inc. v. Davenport, 714 N.E.2d 794, 798 (Ind.Ct.App.1999) (holding that a state law negligence claim for damaged goods shipped in interstate commerce constituted a claim for relief under the Act because it included the proper elements).

9 In its complaint, as well as in its statement of facts supporting its motion for summary judgment, Tremco alleged that: (1) Tremco hired General to ship Tremco’s products to California; (2) General brokered the load to Seaboard; (3) Seaboard brokered the load to Value; (4) Tremco’s products were worth approximately $45,000 at the time that General received them; and (5) Tremco’s products were rendered worthless because Value refused to deliver the load.Tremco established all of the elements of a claim under the Act.See John Morrell & Co., 700 F.2d at 258.

Tremco’s statement of facts was supported by the affidavit of Ralph Skrobacs, Tremco’s manager of transportation services.

Although we examine Tremco’s claim under federal law, Arizona common law also holds common carriers liable for the damage or loss of shipped goods. S. Pac. Co. v. Loden, 19 Ariz.App. 460, 463, 508 P.2d 347, 350 (1973).

10 General then had the burden to produce sufficient competent evidence to demonstrate that there was a genuine issue of material fact. See GM Dev. Corp. v. Cmty. Am. Mortgage Corp., 165 Ariz. 1, 5, 795 P.2d 827, 831 (App.1990) (citation omitted). General contends that its partial denial in its answer was sufficient to establish that there was a genuine issue of material fact. We disagree.

11 After a summary judgment motion has been filed and is properly supported, the other party “may not rest upon the mere allegations or denials of the adverse party’s pleading” to oppose the motion. Ariz. R. Civ. P. 56(e); see also GM Dev. Corp., 165 Ariz. at 5, 795 P.2d at 831. Instead, it must present sufficient competent evidence that challenges the movant’s evidence. See GM Dev. Corp, 165 Ariz. at 5, 795 P.2d at 831. General’s partial denial in its answer, therefore, was insufficient as a matter of law to rebut Tremco’s motion. Moreover, General’s response was unsupported by affidavit or other competent evidence. See id.(stating that a party opposing summary judgment cannot “rely solely on unsworn assertions of fact to controvert a motion which is supported by sworn facts”).

12 General next contends that summary judgment was improper because it presented “unrefuted” evidence of its impossibility defense.

13 The only defenses to a claim under the Act for lost or damaged property are: “(1) an act of God, (2) an act of the public enemy, (3) an act of the shipper, (4) an act of the public authority or (5) the inherent nature or vice of the goods.”Tokio Marine and Fire Ins. Co. v. Amato Motors, Inc., 871 F.Supp. 1010, 1014 (N.D.Ill.1994). Because General did not raise a defense that is recognized by the Act, the court was not precluded from granting summary judgment.

Even if Tremco’s claim had been based in contract, General would not be entitled to the defense of impossibility because: (1) General could have avoided the damages by paying Value the money it was owed by Seaboard, seeRestatement (Second) of Contracts § 261 cmt. d (stating that a party cannot assert the defense of impossibility if it does not attempt to surmount obstacles to performance); and (2) General relied on Value, a third party, to deliver the shipment. See id. cmt. e (stating that if a party’s performance depends on some act of a third party, “he is not ordinarily discharged because of a failure by that party because this is also a risk that is commonly understood to be on the obligor .”).

14 General finally contends that if we affirm the summary judgment, it should be held jointly and severally liable with Value to prevent a double recovery by Tremco. Tremco agrees that it is not entitled to a double recovery, but contends that joint and several liability would be inappropriate because the damages it was awarded against General and Value differ.

15 General did not argue in its answer or in its response to the motion for summary judgment that if found liable, it should be held jointly and severally liable with Tremco. Consequently, General has waived the argument. Odom v. Farmers Ins. Co. of Ariz ., 216 Ariz. 530, 535, ¶ 18, 169 P.3d 120, 125 (App.2007) (“Generally, arguments raised for the first time on appeal are untimely and deemed waived.”).

CONCLUSION

16 For the foregoing reasons, we affirm the trial court’s grant of Tremco’s motion for summary judgment.

CONCURRING: DONN KESSLER, Presiding Judge and PATRICIA A. OROZCO, Judge.

Ariz.App. Div. 1,2008.

Tremco Inc. v. General Transport & Consultants, Inc.