Alco Capital Resource, Inc. v. Picture It, Inc., a California Corporation, and Rodney Catalano, an Individual

64 F.3d 669, 1995 WL 501931
CourtCourt of Appeals for the Tenth Circuit
DecidedJuly 28, 1995
Docket94-4127
StatusPublished

This text of 64 F.3d 669 (Alco Capital Resource, Inc. v. Picture It, Inc., a California Corporation, and Rodney Catalano, an Individual) is published on Counsel Stack Legal Research, covering Court of Appeals for the Tenth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Alco Capital Resource, Inc. v. Picture It, Inc., a California Corporation, and Rodney Catalano, an Individual, 64 F.3d 669, 1995 WL 501931 (10th Cir. 1995).

Opinion

64 F.3d 669

NOTICE: Although citation of unpublished opinions remains unfavored, unpublished opinions may now be cited if the opinion has persuasive value on a material issue, and a copy is attached to the citing document or, if cited in oral argument, copies are furnished to the Court and all parties. See General Order of November 29, 1993, suspending 10th Cir. Rule 36.3 until December 31, 1995, or further order.

ALCO CAPITAL RESOURCE, INC., Plaintiff-Appellee,
v.
PICTURE IT, INC., a California corporation, Defendant,
and
Rodney CATALANO, an individual, Defendant-Appellant.

No. 94-4127.
(D.C.No. 92-CV-852)

United States Court of Appeals, Tenth Circuit.

Filed July 28, 1995.

Before BRORBY, KELLY and HENRY, Circuit Judges.

AMENDED ORDER AND JUDGMENT1

Defendant-appellant Rodney Catalano appeals from the district court's grant of summary judgment in favor of Plaintiff-appellee Alco Capital Resource, Inc. (Alco), and from the district court's award of damages and attorneys fees to Alco. Our jurisdiction arises pursuant to 28 U.S.C. 1291, and we affirm in part and reverse in part.

Background

Alco moved for summary judgment in its action seeking to collect delinquent lease payments from Mr. Catalano, who had personally guaranteed payment on various leases between Alco and Picture It, Inc. Mr. Catalano argued that the leases at issue were actually security agreements governed by Article 9 of the Uniform Commercial Code (UCC), and as such, Alco's damage calculations were in error. Disagreeing with Mr. Catalano's characterization, the district court ruled that, under applicable Georgia law, the lease agreements were not security agreements governed by the UCC, and that Alco was entitled to judgment in the amount of $42,387.73.

Discussion

We review the grant of summary judgment de novo, applying the same legal standard utilized by the district court under Fed.R.Civ.P. 56(c). James v. Sears, Roebuck & Co., 21 F.3d 989, 997-98 (10th Cir.1994). Summary judgment is appropriate when "there is no genuine issue as to any material fact and ... the moving party is entitled to a judgment as a matter of law." Hagelin for President Comm. v. Graves, 25 F.3d 956, 959 (10th Cir.1994) (quoting Fed.R.Civ.P. 56(c)), cert. denied, 115 S.Ct. 934 (1995); see also, Matsushita Elec. Indus. Co., Ltd. v. Zenith Radio Corp., 475 U.S. 574, 585-87 (1986); Celotex Corp. v. Catrett, 477 U.S. 317, 323-27 (1986); Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247-50 (1986). "In applying this standard, we construe the factual record and reasonable inferences therefrom in the light most favorable to the party opposing summary judgment." Blue Circle Cement, Inc. v. Board of County Comm'rs, 27 F.3d 1499, 1503 (10th Cir.1994).

A. Characterizing the Agreements

We agree with the district court's conclusion that the agreements between Alco and Picture It are in fact leases and not security agreements. Georgia law applicable at the time of the leases' 1991 execution provided:

Whether a lease is intended as security is to be determined by the facts of each case; however (a) the inclusion of an option to purchase does not of itself make the lease one intended for security, and (b) an agreement that upon compliance with the terms of the lease, the lessee shall become or has the option to become the owner of the property for no additional consideration or for a nominal consideration does not make the lease one intended for security.

Ga.Code Ann. 11-1-207(37) (1990). It is clear from the language of this statute, and from case law interpreting it that, while perhaps not determinative, the question of which party owns the property is an essential element in distinguishing between a lease and a security agreement. See Tri-Continental Leasing Corp. v. Charles Beall & Co., 709 F.Supp. 218, 220 (N.D.Ga.1989); Ford v. Rollins Protective Servs. Co., 322 S.E.2d 62, 64 (Ga.Ct.App.1984); In re Atlanta Times, Inc., 259 F.Supp. 820, 827 (N.D.Ga.1966), aff'd, 383 F.2d 606 (5th Cir.1967). When, as in the present case, the lessor continues to own the leased goods, and the lessee has no option to acquire ownership, the agreement is a lease. Id.

The intent of the parties, as evidenced by the language of these complete and unambiguous agreements, does not contradict our conclusion. See Tri-Continental Leasing, 709 F.Supp. at 220 (necessary factor in classifying agreement is intent of parties, which may be determined from language of unambiguous document). We agree with the district court that the parol evidence rule operates to bar the admission of additional documents suggesting that the agreements were in the nature of conditional sales. See Chapman v. Avco Financial Serv. Leasing Co., 387 S.E.2d 391, 393 (Ga.Ct.App.1989) (lease containing integration clause may not be varied by parol evidence); Taylor Freezer Sales Co. v. Hydrick, 227 S.E.2d 494, 497 (Ga.Ct.App.1976) ("[p]rior and contemporaneous statements and agreements cannot be shown to vary, contradict or change the terms of a valid written contract purporting on its face to contain all the terms of an agreement between [the] parties").

B. Damages

Mr. Catalano next contends that the district court erred by awarding $31,290.07 in damages to Alco. He argues that:

(1) inconsistencies apparent on the face of affidavits accompanying Alco's motion should have precluded summary judgment on the issue of damages; and (2) the district court failed to consider the impact of Alco's alleged duty to mitigate damages.

Unfortunately, Mr. Catalano has neglected to buttress these arguments with sufficient supporting facts. "Rule 56(e) ... requires the nonmoving party to go beyond the pleadings and by [his] own affidavits, or by the depositions, answers to interrogatories, and admissions on file,' designate specific facts showing that there is a genuine issue for trial.' " Celotex, 477 U.S. at 324 (quoting Fed.R.Civ.P. 56(e) (emphasis added)). Simply put, Mr.

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Bluebook (online)
64 F.3d 669, 1995 WL 501931, Counsel Stack Legal Research, https://law.counselstack.com/opinion/alco-capital-resource-inc-v-picture-it-inc-a-calif-ca10-1995.