JGB, LLC v. ARGOS USA Corporation
MEMORANDUM OPINION. Signed by Judge Virginia Emerson Hopkins on 8/16/2016. (JLC)
2016 Aug-16 AM 09:45
U.S. DISTRICT COURT
N.D. OF ALABAMA
IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ALABAMA
JGB, LLC, a limited liability
ARGOS CEMENT, LLC, a limited
) Case No.: 4:15-CV-998-VEH
This civil action was filed on June 15, 2015, by the Plaintiff, JGB, LLC
(“JGB”), against the Defendant, Argos Cement, LLC (“Argos”). (Doc. 1 ). The First
Amended Complaint alleges that Argos breached two separate mining contracts with
JGB. (Doc. 14). The case comes before the Court on the Defendant’s Motion for
Summary Judgment. (Doc. 27). For the reasons stated herein, the motion will be
Under Federal Rule of Civil Procedure 56, summary judgment is proper if there
is no genuine dispute as to any material fact and the moving party is entitled to
judgment as a matter of law. FED. R. CIV. P. 56(a); see also Celotex Corp. v. Catrett,
477 U.S. 317, 322 (1986) (“[S]ummary judgment is proper if the pleadings,
depositions, answers to interrogatories, and admissions on file, together with the
affidavits, if any, show that there is no genuine issue as to any material fact and that
the moving party is entitled to a judgment as a matter of law.”) (internal quotation
marks and citation omitted). The party requesting summary judgment always bears
the initial responsibility of informing the court of the basis for its motion and
identifying those portions of the pleadings or filings that it believes demonstrate the
absence of a genuine issue of material fact. Celotex, 477 U.S. at 323. Once the
moving party has met its burden, Rule 56(e) requires the non-moving party to go
beyond the pleadings in answering the movant. Id. at 324. By its own affidavits – or
by the depositions, answers to interrogatories, and admissions on file – it must
designate specific facts showing that there is a genuine issue for trial. Id.
The underlying substantive law identifies which facts are material and which
are irrelevant. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). All
reasonable doubts about the facts and all justifiable inferences are resolved in favor
of the non-movant. Chapman, 229 F.3d at 1023. Only disputes over facts that might
affect the outcome of the suit under the governing law will properly preclude the
entry of summary judgment. Anderson, 477 U.S. at 248. A dispute is genuine “if the
evidence is such that a reasonable jury could return a verdict for the nonmoving
party.” Id. If the evidence presented by the non-movant to rebut the moving party’s
evidence is merely colorable, or is not significantly probative, summary judgment
may still be granted. Id. at 249.
How the movant may satisfy its initial evidentiary burden depends on whether
that party bears the burden of proof on the given legal issues at trial. Fitzpatrick v.
City of Atlanta, 2 F.3d 1112, 1115 (11th Cir. 1993). If the movant bears the burden
of proof on the given issue or issues at trial, then it can only meet its burden on
summary judgment by presenting affirmative evidence showing the absence of a
genuine issue of material fact – that is, facts that would entitle it to a directed verdict
if not controverted at trial. Id. (citation omitted). Once the moving party makes such
an affirmative showing, the burden shifts to the non-moving party to produce
“significant, probative evidence demonstrating the existence of a triable issue of fact.”
Id. (citation omitted) (emphasis added).
For issues on which the movant does not bear the burden of proof at trial, it can
satisfy its initial burden on summary judgment in either of two ways. Id. at 1115-16.
First, the movant may simply show that there is an absence of evidence to support the
non-movant’s case on the particular issue at hand. Id. at 1116. In such an instance, the
non-movant must rebut by either (1) showing that the record in fact contains
supporting evidence sufficient to withstand a directed verdict motion, or (2)
proffering evidence sufficient to withstand a directed verdict motion at trial based on
the alleged evidentiary deficiency. Id. at 1116-17. When responding, the non-movant
may no longer rest on mere allegations; instead, it must set forth evidence of specific
facts. Lewis v. Casey, 518 U.S. 343, 358 (1996). The second method a movant in this
position may use to discharge its burden is to provide affirmative evidence
demonstrating that the non-moving party will be unable to prove its case at trial.
Fitzpatrick, 2 F.3d at 1116. When this occurs, the non-movant must rebut by offering
evidence sufficient to withstand a directed verdict at trial on the material fact sought
to be negated. Id.
The Parties and Their Business Relationship
Argos operates a cement manufacturing facility in Calera, Alabama. Don
Collier is the purchasing manager for Argos. (Doc. 27-2 at 5(15)). In his deposition,
Collier described his job responsibilities as “[p]rocurement of goods and services to
support the manufacturing facility.” (Doc. 27-2 at 5(16)). Collier originally drafted
the contracts at issue in this case. (Doc. 27-2 at 7(23)). David Bremer is the U.S.
cement manufacturing quarry and mining manager for Argos. (Doc. 27-10 at 5(14)).
In 2013, he was the quarry manager for Argos. (Doc. 27-10 at 5(15); doc. 27-11 at 2).
JGB is an excavating company which performs mining work. The company
was established in 2001, and has performed various work for Argos (and its
predecessor in interest) since 2003. JGB’s managing member/sole owner is Jim
Bockman. Tim Blankenship was employed as JGB’s managing agent during his entire
time with the company.
The business conducted between Argos and JGB was principally governed by
two contracts—a clay mining contract and a quarry stripping contract. The contracts
were originally between Lafarge North America, Inc. (“Lafarge”) and JGB. Argos
subsequently acquired Lafarge’s facility, and the clay mining and quarry stripping
contracts were assigned to Argos.
The Clay Mining Contract
Lafarge and JGB originally entered into the clay mining contract on January
1, 2009. Donald Collier signed the clay mining contract on behalf of Lafarge.
Blankenship, as JGB’s managing agent, signed the clay mining contract on behalf of
JGB. Pursuant to the clay mining contract, JGB was required to remove clay from
Argos’ clay pit and haul it to the clay stockpile area.
The clay mining contract had a term of “January 1, 2009, through December
31, 2010, with Year-to-Year renewal options.” (Doc. 14 at 9). On April 22, 2010, the
clay mining contract was revised by mutual agreement of the parties. Collier signed
the revised clay mining contract on behalf of Lafarge. Blankenship, as was the case
with the original contract, signed the revised clay mining contract on behalf of JGB.
The revised clay mining contract carried forward the same term as the original
contract of “January 1, 2009, through December 31, 2010, with Year-to-Year renewal
options.” (Doc. 27-4 at 2). The parties agree that, pursuant to this provision, the
contract required mutual agreement before the clay mining contract would be
renewed. The parties also agree that there is no language specifying how renewals are
to be exercised.
On or about May 12, 2011, Lafarge entered into an agreement with Argos
providing for the acquisition by Argos of the cement and ready mix business of
Lafarge in the Southeastern United States. JGB’s contract with Lafarge was assigned
to Argos with the consent of JGB. It is undisputed that the parties mutually agreed to
exercise the renewal option under the clay mining contract at least for the period
between 2011 through 2013.1 In the following exchange from Collier’s deposition,
he explains how the contracts were renewed:
Okay. And you say as we agreed it renewed. Did anybody do
anything to renew this contract?
In other words, this contract automatically renewed?
The parties dispute whether it was renewed thereafter.
As we mutually agreed.
. . . Well, what I’m getting at is nobody took any action in 2011,
the contract continued?
Same thing for 2012?
Same thing for 2013?
And you didn’t have to call Mr. Bockman and say, Mr. Bockman,
the contract's, good we’re fine with it. He didn’t have to call y’all; it just
(Doc. 27-2 at 17(63-64)).
It is undisputed that, in the Fall of 2013, Argos decided it was not going to
renew the clay mining contract for 2014. (Doc. 27-1 at 6, ¶18 (Defendant’s proffered
fact); doc. 32 at 7, ¶18 (Plaintiff’s response does not dispute)).2 Instead, they had
JGB proffers, without citation to the record:
In fact, there was a valid 2014 Clay Mining Contract.
(Doc. 32 at 12, ¶15). This conclusory, unsupported fact, which goes to the ultimate issue in the
case, will not be included. Similarly, JGB also proffers:
decided to open the contract up to bids.
Blankenship was initially informed about Argos placing the clay mining
contract out to bid during a September 2013 meeting with David Bremer. (Doc. 27-10
at 5((14-15)). On October 7, 2013, Bremer met with both Blankenship and Bockman,
and it was again communicated that the clay mining contract would be going out for
bid. (Doc. 27-11 at 2, ¶4).
On another occasion, after October 7, but before December 3, 2013, Collier
verbally told Blankenship that Argos was putting the clay mining contract out for bid
and informed him of the pre-bid meeting being held on December 9, 2013. (Doc. 27-2
at 31(120)-32(121)). On December 3, 2013, Collier sent Blankenship an email which
stated: “Tim, as discussed I am forwarding the information regarding the pre-bid
meeting scheduled for 12/9/2013 at 10:30 a.m. at the quarry office.” (Doc. 27-12 at
2). Attached to the email was a “Request for Quotation” which, among other things,
gave the date of the December 9, 2013, information meeting, the dates that bids
would be requested and should be returned, and noted that the contract would be
awarded on December 20, 2013. (Doc. 27-12 at 3). It also stated: “You are invited to
During the one-year renewal term of the 2013 Clay Mining Contract, JGB
exercised its renewal option according to paragraph 1 of the Contract. (Lafarge
Clay Mining Contract/Master Agreement; Ex. "E").
(Doc. 32 at 13, ¶16). JGB’s citation to the agreement alone does not prove that it “exercised its
renewal option.” This fact will not be included.
submit a quotation to the ARGOS Roberta Cement Quarry, Alabama USA – 2014
Clay stripping, no later than 12/18/2013, 12:00 (Central Time).” (Doc. 27-12 at 3;
see also, doc. 27-12 at 4 (“You are invited to bid for Clay mining at the Roberta
Meadowood and Red Little Tract Clay/stripping sites near Roberta, Alabama[.]”))
(italics and bold in original). The document also included various specifics regarding
the job and site, and how bids should be made. (Doc. 27-12 at 3-9). Blankenship was
out-of-town on December 3, 2013, but received Argos’ e-mail concerning the request
for bids a couple of days later when he returned home.
After receiving the bid materials from Argos, and before the December 9 bid
meeting, Blankenship discussed with Bockman the fact that Argos was soliciting bids
for clay mining services in 2014. (Doc. 27-3 at 14(52)-15(53)); doc. 27-9 at 18(6667)); doc. 27-11 at 3, ¶ 5).3 Blankenship and Bockman then both attended the pre-bid
The facts in this sentence were proffered by Argos. (Doc. 27-1 at 7-8, ¶24). JGB
generally disputes the facts in this sentence and several others in one paragraph of its brief. (See,
doc. 32 at 7, generally disputing Defendant’s proffered facts numbers 24-28). This Court’s
Uniform Initial Order, entered in this case on June 16, 2015, provides:
The non-moving party’s response to the moving party’s claimed undisputed facts
shall be in separately numbered paragraphs that coincide with those of the
moving party’s claimed undisputed facts. Any statements of fact that are disputed
by the non-moving party must be followed by a specific reference to those
portions of the evidentiary record upon which the dispute is based. All material
facts set forth in the statement required of the moving party will be deemed to be
admitted for summary judgment purposes unless controverted by the response of
the party opposing summary judgment.
(Doc. 4 at 17) (emphasis in original). This is the second time that this Court has brought this
meeting along with one of JGB’s supervisors. (Doc. 27-3 at 17(63)-(64), 18(65)).
Bockman agreed that, at this meeting, representatives from Argos explained that the
clay mining contract was being put out for bid. (Doc. 27-9 at 19(72)).
In Blankenship’s deposition, the following exchange took place:
So as of December 9th, were you aware that Argos was going to
go forward with putting the clay mining contract out to bid?
(Doc. 27-3 at 17(64)). Elsewhere, in Blankenship’s deposition there was this
Were you aware as of the time of this pre-bid meeting that Argos
was going to get somebody to enter into a new contract to mine clay at
the Roberta facility?
On this day, it looked like they were going to.
Did you have any reason to think they were not going to follow
language to the attention of JGB. (See, doc. 31, at 1). The first time was after JGB failed to
dispute any of Argos’ proffered statements of fact and the Court allowed JGB a second bite at the
apple. This time around JGB states, in a footnote, that, “[f]or the court’s convenience the
numbered factual paragraphs from the Defendant’s Motion for Summary Judgment have been
consolidated.” (Doc. 32 at 7, n. 1). The Court does not deem such “consolidated” responses to
follow either the letter, or the spirit, of its order. Further, JGB’s statements in response to these
paragraphs do not, for the most part, actually dispute the facts proffered by Argos. Instead, they
focus on whether, based on the facts proffered by Argos, JGB was aware that the contract would
not be renewed. Only two of the facts in these paragraphs arguably speak to that issue. (See,
doc. 27-1 at 8, ¶26 (“JGB was therefore aware that Argos was putting the clay mining contract
out to bid and a new contract would be utilized for clay mining services in 2014”); doc. 27-1 at 9,
¶30 (“JGB knew in December 2013 that the clay mining contract would not be renewed for
2014”)). To the extent that facts proffered by Argos are not specifically disputed by JGB, they
have been deemed by the Court to be admitted, and have been included.
Well, we had had a long relationship doing it, and I had no reason
to believe that we had had any problems, but here we go. We’ve got a
pre-bid meeting and, I mean, we’ve seen this happen before and then not
anything -- you know, maybe I was being naive.
But as far as you knew, Argos was going out for bid on this same
(Doc. 27-3 at 18(66-67)). Then, there was this dialogue in Blankenship’s deposition:
In your mind, there had to be some event, there had to be a
Otherwise, it should have been renewed for another year. Is that
That’s what they had done for years and years.
And they had told you in December 2013 they weren’t going to
do that anymore, right?
(Doc. 27-3 at 22(84)-23(85)). Blankenship also testified that he “[h]ad lots of
conversations” with people at Argos after the bid meeting. (Doc. 27-3 at 18(67)). He
also received a document from Argos, which was prepared by Argos and provided to
potential bidders, that answered questions which were asked by potential bidders
following the December 9 meeting. (Doc. 27-3 at 19(72)).
JGB did not bid on the contract. Instead, Bockman, on December 18, 2013,
gave Collier a letter which read:
JGB, LLC is not participating in Argos[’] request for Quotation for the
2014 Red Little Tract Clay Mining and Meadowood Tract Clay Mining.
However, the Master Purchase Agreement between Lafarge North
America, Inc. and JGB, LLC, dated January 1, 2009, and consented to
and assigned to Argos USA around October 2010 contractually controls
this process. That Agreement provides that “the period covered by this
Agreement shall be January 1, 2009, through December 31, 2010, with
year-to-year renewal options[.]” It further stipulates that the pricing for
these options is specified in Schedule (A) of [that] Agreement. For
Calendar years 2011, 2012[,] and 2013 JGB, LLC and Argos orally
extended this contract and used Schedule (A) for pricing. Since we have
not breached the contract and such contract is not restrictive to any
specific area, we believe our renewal option for 2014 should be $3.05
plus annual increase in CPI as published by the U.S. Department of
Labor and Argos provides fuel for these projects.
(Doc. 27-15 at 2). Bockman signed the letter as “Managing Member, JGB, LLC.”
(Doc. 27-15 at 2).
On December 20, 2013, two days after Collier received Bockman’s December
18th letter, Bremen sent Collier an email which stated:
I will not be back in the office until after the new year. We would need
to notify JGB that we aren’t going to extend the contract before the year
ends or they will have some right to extension. I don’t think it can wait
until I get back.
(Doc. 29-12 at 1).4 When asked in his deposition whether this was “what [he]
believed on that day,” Bremer stated
I mean, all I can talk about is what was written there. I don't
remember. That was a long time ago.
What I do remember in general is that I was trying to get this issue
resolved and work my way through it.
And like I said, I’m not purchasing. I’m not a lawyer. I was just
trying to get through it knowing how things went in the past with Jim
and JGB, and I was just trying to get through.
I mean, what word I chose or what I was trying to do I was trying
to convey the message and that's why you see lots of e-mails and me
trying to follow up is because I'm saying I just want to make sure this
goes through. I mean, and I'm trying to ask the people who can help me
(Doc. 27-10 at 34(129-130)). Bremer added that, with this email, he “ was trying to
make sure things went as smooth as possible, so I was trying to kick it up to [Collier]
and say hey, help me out here, I'm not sure what to do.” (Doc. 27-10 at 34(132)).
On January 2, 2013, Collier sent an email to Bockman and Blankenship which
read: “Gentlemen, attached is the notification letter form Argos Cement LLC
regarding the Roberta Quarry Clay Mining Project.” (Doc. 27-16 at 2). Attached to
that email was a letter to Bockman’s attention, dated December 30, 2013, which
There is no evidence that this email was ever forwarded to anyone from JGB.
The purpose of this letter is to serve as notification that effective
12/31/2013 Argos Cement LLC will not require the services of JGB,
Inc. for the sole purpose of clay mining at the Argos Cement Roberta
Plant located in Calera, AL. This termination will be effective 30 days
after notification date.
(Doc. 27-16 at 3). The letter was signed by Collier, as the “Purchasing Manager” for
Argos. (Doc. 27-16 at 3).
The clay mining contract contained a “termination” clause which sets out under
what conditions a party to the contract could terminate it. (Doc. 27-4 at 5, ¶19).5 It is
undisputed that none of those conditions existed in this case. In his deposition, Collier
stated that, despite the phrasing used in his letter, Argos did not “terminate” the
contract, they merely did not renew it. (Doc. 27-2 at 20(73)). He stated that
The clause reads:
In addition to its other remedies at law or equity either party may terminate this
Agreement as permitted as follows;
By written notice to the other party if a material breach has occurred by the
other party and such breach has continued without correction for a period of
thirty (30) days after receipt of written notice thereof from the terminating
By written notice to the other party upon the insolvency, receivership or bankruptcy
of the other party, an assignment by the other party for the benefit of its creditors, or
the filing of any petition by or against the other party under the Bankruptcy Code as
now in force or hereafter amended or under any similar act for the relief of debtors;
provided in the case of an involuntary petition against one (1) party, such is not
dismissed with thirty (30) days.
(Doc. 27-4 at 5, ¶19) (bold in original).
“termination” was the wrong choice of words. (Doc. 27-2 at 20(75); doc. 27-2 at
The Quarry Stripping Contract
On or about June 1, 2005, JGB and Lafarge entered into an agreement by which
JGB agreed to strip materials at Lafarge’s Vulcan Quarry. Stephen Dishman executed
the quarry stripping contract for Lafarge. Blankenship signed the quarry stripping
contract on behalf of JGB.6 The stripping of material included the transport of various
volumes of material as well as construction of internal access roads and ramps.
The contract originally provided that
JGB, LLC will strip a yearly yardage (est. at a minimum of 2,000,000
and maximum of 2,500,000 yards per year[)] and will be paid $2.16 per
yard[.] The rate of $2.16 is based on a distance of no more than three (3)
miles round trip from point of stripping to point of dumping material.
(Doc. 27-7 at 7).
Approximately four years into the relationship, the parties agreed to revise the
quarry stripping contract. Collier and Bremer signed the revised quarry stripping
contract for Lafarge. Blankenship, as JGB’s managing agent, and Bockman, as JGB’s
managing owner, signed the quarry stripping contract for JGB. The revised quarry
The first five pages of this contract are identical to the first five pages of the clay
mining contract. Collier testified in his deposition that the provisions in these pages, in each
contract, were non-negotiable. (Doc. 29-6 at 8(30)). Collier also testified that he could have
changed any provisions in either contract, and added a bid provision, but he did not. (Doc. 29-6
stripping contract, among other things, replaced the provision setting forth estimated
minimum and maximum stripping yardage with a five year schedule of “anticipated
estimated stripping volumes.” (Doc. 27-5 at 7). The anticipated estimated stripping
volumes were long term, future projections of Lafarge’s stripping needs. Accordingly,
the revised quarry stripping contract obligated Lafarge to provide JGB with a good
faith estimate of its planned stripping volume in October of the preceding year. The
term extended from June 1, 2005, through May 31, 2015, with year-to-year renewal
options. JGB and Lafarge operated pursuant to the terms of the contract from 2005
through part of 2011.
In 2011, JGB’s contract with Lafarge was assigned to Argos with the consent
of JGB. Thereafter, JGB and Argos operated pursuant to the terms and conditions of
the revised quarry stripping contract. On October 7, 2013, Bremer, pursuant to the
terms of that agreement, sent Bockman and Blankenship an email containing a good
faith estimate for 2014. The email stated that “[b]ased on current 2014 volume
forecasts that we have received from our customers, and the associated mine plans,
we estimate that we will require 222,554 BCY of material to be moved by JGB, LLC
in 2014.” (Doc. 27-17 at 2). The e-mail further provided that “[t]his volume may be
affected by any excess volume that is mined by JGB in 2013 beyond our original
planned stripping area.” (Doc. 27-17 at 2). In his deposition, Blankenship agreed that
it was accurate to say that “Argos determined the amount of the stripping that they
needed done.” (Doc. 27-3 at 26(100)). He also agreed that, although Argos tried to
give JGB a good faith estimate of what they needed done, “at the end of the day,
based on their needs, Argos determined how much needed to be stripped.” (Doc. 27-2
at 27(101)). Blankenship also agreed that JGB got paid for work that was actually
done, whether it was more or less than the good faith estimate. (Doc. 27-3 at 27(104)28(105)).
Using the estimate provided to JGB, Argos issued a purchase order in the
amount of $751,030. (Doc. 27-18 at 2; doc. 27-3 at 30(115)). The import of this
purchase order is a source of contention. JGB makes no argument that it was not paid
for the work it did.7 Instead, the Plaintiff contends that “JGB was not permitted by
Argos to fulfill the entire purchase order, resulting in a shortage to JGB of
$287,437.67.” (Doc. 32 at 20, ¶50).
Collier also testified that “[w]e only pay for work they completed.” (Doc. 27-2
at 30(114)). Collier testified in his deposition that purchase orders “were issued to
cover the invoicing process.” (Doc. 27-2 at 29(112)). He continued: “They don’t
necessarily . . . do all the volumes that were on the purchase order. It depended upon
It is undisputed that Argos gave JGB timely notice that it would not be renewing this
agreement. Unlike the clay mining contract, in this instance, JGB seeks only the difference
between what it was paid, and what the purchase order provided. (Doc. 32 at 32).
. . . the business directive.” (Doc. 27-2 at 30(116)). In his deposition, Blankenship
agreed that “there had to be a purchase order in place so JGB could get paid. . . . If
there [was] no purchase order, there would be no way for [Argos’] accounting people
to process [JGB’s] invoices.” (Doc. 27-3 at 30(115-116)). Similarly, Bockman
described the purchase order as “just an accounting function to distinction [sic] where
the money goes.” (Doc. 27-9 at 29(112)).
Both contracts provide that they “shall be construed in accordance with and
governed by the laws of the Commonwealth of Virginia.” (Doc. 27-4 at 4; doc. 27-5
at 4). No party argues for the application of any other state’s law to these agreements.
The Clay Mining Contract (Count One)
Count One of the Amended Complaint alleges that Argos
breached the Clay mining Contract . . . by refusing to honor the terms
and conditions of the contract for the calendar year 2014 without
providing JGB with reasonable notice of the termination of the Clay
(Doc. 14 at 4, ¶19). In Virginia, the elements of a breach of contract action are: “(1)
a legally enforceable obligation of a defendant to a plaintiff; (2) the defendant's
violation or breach of that obligation; and (3) injury or damage to the plaintiff caused
by the breach of obligation.” Navar, Inc. v. Fed. Bus. Council, 291 Va. 338, 344, 784
S.E.2d 296, 299 (2016) (internal quotations and citations omitted). Argos argues that
it is entitled to summary judgment because it did not renew the clay mining contract
for 2014. (Doc. 27-1 at 15). If that is the case, JGB’s prima facie case fails as it
cannot establish that Argos had a “legally enforceable obligation” to JGB.
The Supreme Court of Virginia has noted that “[i]t is elementary that mutuality
of assent—the meeting of the minds of the parties—is an essential element of all
contracts.” Phillips v. Mazyck, 273 Va. 630, 636, 643 S.E.2d 172, 175–76 (2007). The
requirement of mutual assent also applies to renewals of existing contracts. Aetna
Cas. & Sur. Co. v. Harris, 218 Va. 571, 575, 239 S.E.2d 84, 86 (1977). In the instant
case, it is undisputed that Argos had decided not to renew the contract with JGB for
2014. However, in Virginia, whether a party assented to the terms of a contract should
be ascertained “from that party’s words or acts, not from his or her unexpressed state
of mind.” Phillips, 643 S.E.2d at 175 (citing Wells v. Weston, 229 Va. 72, 78, 326
S.E.2d 672, 676 (1985)). “In evaluating a party's intent . . . we must examine his
outward expression rather than his secret, unexpressed intention.” Wells, 326 S.E.2d
JGB argues that Argos was required to affirmatively give JGB notice that it
was not renewing before the renewal date of January 1, 2014, and that, if did not, the
contract automatically renewed.8 Further, JGB argues that its December 18, 2013,
letter to Collier stating that JGB was renewing the agreement required Argos to
respond saying that it was not. JGB argues that “the only notice to JGB from Argos
that the contract would not be renewed was after the period of renewal.” (Doc. 32 at
26) (referring to Collier’s “termination” letter attached to the January 2, 2014, email).
First, the contract says nothing about giving “notice” of renewal or nonrenewal. Further, JGB cites no provision in the agreement allowing it to unilaterally
renew the contract, or requiring Argos to affirmatively state that it is not renewing,
even if JGB affirmatively states that it is. Regardless, in his deposition, Blankenship
agreed that, despite the fact that for “years and years” Argos had renewed the
contract, Argos told JGB “in December 2013 they weren’t going to do that anymore.”
(Doc. 27-3 at 22(84)-23(85)). Accordingly, even if an affirmative “non-renewal” was
required, Argos did so.
Also, in the instant case, Argos, through all of its conduct, made it extremely
clear that it was not going to renew the agreement for 2014. While there is no
provision in the contract explaining how renewal is to be done, and despite there
being no “automatic renewal” language in the contract, in previous years neither party
This is a strange position for JGB to take when it has acknowledged that “there is no
language as to how renewals are to be exercised.” (Doc. 32 at 18, ¶40).
took any action regarding renewal or non-renewal, and the agreement merely
continued on into the next year. By contrast, as early as September 19, 2013, about
three months before the expiration of the contract’s 2013 term, Bremer had a meeting
with Blankenship and informed him that the contract would be placed out for bid. On
October 7, 2013, Blankenship and Bockman both met with Bremer, and Bremer told
them that the clay mining contract would be going out for bid. After October 7, 2013,
but prior to December 3, 2013, Collier told Blankenship that Argos was putting the
clay mining contract out for bid and informed him of the pre-bid meeting being held
on December 9, 2013. On December 3, 2013, Argos sent Blankenship, via email, the
request for bids for clay mining services. Blankenship and Bockman then both
attended the pre-bid meeting along with one of JGB’s supervisors, and it was, again,
made very clear that the job was being put out to bid. Blankenship testified that, after
the bid meeting, he “[h]ad lots of conversations” with people at Argos about the bid.
(Doc. 27-3 at 18(67)). After the bid meeting, Blankenship also received a document
from Argos, which was prepared by Argos and provided to potential bidders, and
which answered questions which were asked by potential bidders following the
December 9 meeting. (Doc. 27-3 at 19(72)). Further, representatives from JGB knew
that Argos did not mutually assent to the renewal. In his deposition, Blankenship
agreed that, as of December 9, 2013, he was “aware that Argos was going to go
forward with putting the clay mining contract out to bid.” (Doc. 27-3 at 17(64); see
also, doc. 27-3 at 18(66-67)). Bockman agreed that, representatives from Argos
“explain[ed] to the folks who attended [the December 9, 2013 meeting] that the clay
mining contract was being put out for bid.” (Doc. 27-9 at 19(72)).9
JGB draws the Court’s attention to Bremer’s December 20, 2013, email to
Collier stating that “we need to notify JGB that we aren’t going to extend their
contract before the year ends or they will have some right to extension.” (Doc. 29-12
at 1). It agues that this email demonstrates that Argos “understood its obligations
under the contract to timely notify JGB of its intention not to renew the contract prior
to December 31, 2013.” (Doc. 32 at 22). First, as noted above, Bremer explained in
his deposition that he did not mean that the contract would renew if Argos did
nothing. (Doc. 27-10 at 34(129-130, 132)). Regardless, Bremer’s opinion in his email
cannot change the terms of the contact and create an automatic renewal where none
JGB argues that “these examples only indicated to JGB that Argos was going to put the
contract out for bids, not that Argos would not renew the contract.” (Doc. 32 at 25). This
argument strains credulity. The “Request for Quotation” sent by Argos to JGB in December of
2013, asked JGB to bid on the contract and noted, among other things, that the contract would be
awarded on December 20, 2013. (Doc. 27-12 at 3). If the fact that Argos was taking bids on the
work was not incompatible with JGB’s contract being renewed, then certainly this language
made it clear that a new contract to perform the work was going to be awarded to someone.
Further, as noted above, Blankenship admits that he was told, in December of 2013, that the
contract was not going to be renewed. JGB cannot avoid reality by merely sticking its head in
existed before.10 Finally, the point is moot since Blankenship admits that, in
December 2013, Argos did tell JGB that they were not going to renew the
JGB argues that the Court should look to the parties’ prior dealings to
determine their rights under the contract. Argos objects to doing so, citing a provision
in the contract which states that the contract’s terms “may not be added to, changed,
supplemented or explained by alleged prior dealings, usage of trade or course of
dealing or performance.” (Doc. 33 at 8) (quoting doc. 27-4 at ¶19). The court need
not spend much time on this argument since, as noted above, looking at the parties’
prior conduct vis a vis renewal does not help JGB. In prior years the parties did
nothing and the contract renewed. If that is the standard for renewal, it was not
followed in the instant case, where Argos not only told Blankenship that they were
not renewing the contract, it engaged in conduct demonstrating as much.12
JGB argues at length that Collier’s “termination” letter, attached to his email of
January 2, 2014, was not an effective termination pursuant to the terms of the contract. (Doc. 32
at 22, 26-28, 31). The Court agrees, but, as noted by the Defendant, “Argos is not now claiming,
nor was it at the time, that the clay mining contract was terminated in accordance with the
termination clause. Argos is saying there was no mutual assent to renew the clay mining contract
so there was nothing to terminate because no contract existed.” (Doc. 33 at 7).
JGB states that Argos “argues that there was no mutual assent to renew the Clay
Mining contract because the parties just ‘didn’t get along’ or ‘didn’t like each other[.]’” (Doc. 32
at 23). The Court cannot find such an argument anywhere in Argos’ briefs.
The Court notes that JGB also argues that the phrase “renewal options” in the contract
is undefined and ambiguous. Further, it argues that
Because JGB cannot show that there was mutuality of assent to entering into
the renewal, it cannot prove that Argos had a legally enforceable obligation to JGB,
and its prima facie case fails. Summary Judgment is therefore due to be granted in
favor of Argos, and against JGB, as to Count One.
The Quarry Stripping Contract (Count Two)
Count Two of the Amended Complaint alleges that Argos “breached the
Vulcan Quarry Stripping Contract by not allowing JGB to fill Argos[’] Purchase
Order.” (Doc. 14 at 6). JGB’s underdeveloped argument as this contract cites no
authority, cites no contractual provisions referencing purchase orders, and otherwise
makes no attempt to explain why it should be paid on the balance of the purchase
The purchase order was based on a good faith estimate of Argos’ planned
stripping volume for 2014. There is no evidence that the purchase order, which was
no documents specify whether JGB, Argos, or both possess a renewal option.
Likewise [the contract omits] an explanation of how the renewal option should be
exercised. Finally, neither document states when the renewal option must be
(Doc. 32 at 30). Even if the Court agreed with JGB, JGB argues only that “it is important to
examine the manner [in which] the parties renewed the prior contract since the language on
renewals is ambiguous.” (Doc. 32 at 31). As shown above, doing so does not help JGB.
To the extent that JGB is arguing some contractual theory based upon reliance, it
argues only that it relied on the good faith estimate, not the purchase order, in making its bid.
(Doc. 32 at 32). Even if that were case, JGB fails to explain why it should be entitled to recover
because of such reliance.
based on this estimate created some enforceable agreement with JGB. On the
contrary, the undisputed evidence is that Argos only pays for work that JGB actually
completes. (Doc. 27-2 at 30(114)). Collier testified in his deposition that purchase
orders “were issued to cover the invoicing process.” (Doc. 27-2 at 29(112)). He
explained that JGB “[does not] necessarily . . . do all the volumes that were on the
purchase order. It depended upon . . . the business directive.” (Doc. 27-2 at 30(116)).
Blankenship agreed that “there had to be a purchase order in place so JGB could get
paid. . . . If there [was] no purchase order, there would be no way for [Argos’]
accounting people to process [JGB’s] invoices.” (Doc. 27-3 at 30(115-116)).
Similarly, Bockman described the purchase order as “just an accounting function to
distinction [sic] where the money goes.” (Doc. 27-9 at 29(112)).
Because JGB cannot show that the purchase order created a legally enforceable
obligation to JGB, its prima facie case fails. Summary Judgment is therefore due to
be granted in favor of Argos, and against JGB, as to Count Two.
Based on the foregoing, Argos’ Motion for Summary Judgment will be
GRANTED, and this case will be DISMISSED with prejudice. A Final Order will
DONE and ORDERED this 16th day of August, 2016.
VIRGINIA EMERSON HOPKINS
United States District Judge
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