Integrity Coal Sales Inc v. C & B Coal LLC et al
Filing
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OPINION AND ORDER denying 15 MOTION for Summary Judgment filed by Integrity Coal Sales Inc. Signed by Judge James P. Jones on 2/14/2014. (lml)
IN THE UNITED STATES DISTRICT COURT
FOR THE WESTERN DISTRICT OF VIRGINIA
BIG STONE GAP DIVISION
INTEGRITY COAL SALES, INC.,
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Plaintiff,
v.
C & B COAL, LLC, ET AL.,
Defendants.
Case No. 2:13CV00043
OPINION AND ORDER
By: James P. Jones
United States District Judge
Steven R. Minor, Elliott Lawson & Minor, Bristol, Virginia, for Plaintiff;
Dan Bieger, Dan Bieger, PLC, Bristol, Tennessee, for Defendants.
In this civil diversity case, the plaintiff, Integrity Coal Sales, Inc.
(“Integrity’) sues to recover advance payments for the purchase of coal that it paid
to defendant C & B Coal Company, LLC (“C & B”). It asserts that C & B’s parent
company, codefendant Cobalt Coal, LLC (“Cobalt”), is also liable for a portion of
the payments. In advance of trial Integrity has filed a Motion for Summary
Judgment as to both defendants, which motion has been briefed and argued and is
ripe for decision.
I
The basic facts are not in dispute. In 2011, Integrity and C & B contracted
for the purchase by Integrity of metallurgical coal produced by C & B. In accord
with the agreement, Integrity made advance payments to C & B totaling $193,000.
In return, C & B delivered two shipments of coal, but has been unable to deliver
any more coal, leaving a balance of the advances of $98,572.96. The last advance
was made on August 11, 2011.
By written agreement dated February 12, 2012, Cobalt acquired C & B. In
the contract, Cobalt agreed to assume the debts of C & B “as itemized in Exhibit A
attached and incorporated hereto by reference.” (Mot. Summ. J., Ex. 3, ¶ 2(d)(ii).)
Exhibit A listed an account payable to Integrity Coal in the amount of $86,633,
along with other accounts payable.
In opposition to summary judgment, C & B and Cobalt have filed an
affidavit of Al Kroontje, an agent of Cobalt, who states that “Ronald Collins,
acting as Managing Member of C&B Coal, LLC, represented to me that ‘you need
to pay all of the other bills but you can simply pay Integrity out of coal sales
pursuant to my agreement with Greg Licata of Integrity Coal Sales.’” (Kroontje
Aff. ¶ 3, Nov. 14, 2013.) In addition, the defendants have filed a affidavit of
Michael Crowder, now Managing Member of C&B Coal, LLC, who states that C
& B “expect[s] to be producing coal by the deep mining method within 6 months.”
(Crowder Aff. ¶ 3, Jan. 3, 2014.)
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In opposing summary judgment, the defendants argue that, even though
Cobalt is liable under its contract to assume C & B’s debt to Integrity, 1 it has not
been shown that the debt is due, since according to its evidence, C & B could pay
Integrity out of future coal sales, which will be made once C & B resumes
production. In response, Integrity asserts that because Exhibit A to the agreement
between C & B and Cobalt is entitled “Accounts Payable,” that is an admission
that C & B’s debt was due upon demand. Alternatively, Integrity argues that
absence a specific time provision, the delivery of the coal purchased was due
within a reasonable time, Va. Code Ann. § 8.2-309(1) (2001), and that the passage
of two years from the last advance cannot be so characterized.
II
Integrity clearly has the burden of proof to show that the debt sued upon was
due. “‘As is well established, in a summary judgment proceeding the party against
whom the burden of proof falls at trial faces a challenge more difficult than
otherwise.’” Francis v. Booz, Allen & Hamilton, Inc., 452 F.3d 299, 308 (4th Cir.
2006) (quoting Alan’s of Atlanta, Inc. v. Minolta Corp., 903 F.2d 1414, 1425 (11th
Cir. 1990)). While I have some skepticism that the agreement between Integrity
1
Integrity is certainly a third-party beneficiary to the agreement between C & B
and Cobalt. See Va. Code Ann. § 55-22 (2012); Swain v. Va. Bank & Trust Co., 144 S.E.
645, 649 (1928); Smokeless Fuel Co. v. C&O Ry., 128 S.E. 624, 627 (1925).
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and C & B allowed C & B to delay repayment of Integrity’s advances until it
decided that it could mine coal profitably, I do not believe that the undisputed
evidence before me allows me to grant judgment at this stage to the plaintiff.
Absent more facts as to the understanding between Integrity and C & B as to when
payment of the advances was due, or evidence as to the usual practice between the
parties or in the industry, I cannot at this point find the defendants liable.
Accordingly, it is ORDERED that the Motion for Summary Judgment (ECF
No. 15) is DENIED.
ENTER: February 14, 2014
/s/ James P. Jones
United States District Judge
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