Commonwealth Aluminum Corp. v. Stanley Metal Associates

186 F. Supp. 2d 770, 2001 U.S. Dist. LEXIS 23680, 2001 WL 1775359
CourtDistrict Court, W.D. Kentucky
DecidedAugust 9, 2001
Docket1:00-cv-00120
StatusPublished
Cited by6 cases

This text of 186 F. Supp. 2d 770 (Commonwealth Aluminum Corp. v. Stanley Metal Associates) is published on Counsel Stack Legal Research, covering District Court, W.D. Kentucky primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

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Commonwealth Aluminum Corp. v. Stanley Metal Associates, 186 F. Supp. 2d 770, 2001 U.S. Dist. LEXIS 23680, 2001 WL 1775359 (W.D. Ky. 2001).

Opinion

MEMORANDUM OPINION

SIMPSON, Chief Judge.

This matter is before the Court on the Defendant’s motion for partial summary judgment. In addition, the Defendant, Stanley Metah Associates (“Stanley”), moves to strike a number of documents attached as exhibits to the Plaintiffs Response to the motion for summary judgment. For the reasons stated below, we will deny these motions by separate order.

FACTS

The Plaintiff, Commonwealth Aluminum Corp. (“Commonwealth”) manufactures multi-use sheet products and, in the course of its business, buys scrap aluminum from suppliers. Stanley is one of these scrap aluminum suppliers.

Commonwealth claims that the two parties entered into an oral agreement “on or about” October of 1998. This agreement purportedly was evidenced by eight purchase orders sent by Commonwealth to Stanley shortly after the oral agreement. Stanley, however, never fulfilled its alleged obligations under the oral agreement and, with respect to each purchase order, delivered less aluminum than was requested or none at all. Commonwealth has filed suit seeking damages alleging Stanley’s breach of this contract.

Stanley admits that it began performance on three of the purchase orders but did not complete them. Therefore, there is no issue as to their validity. Stanley claims, however, that the other five purchase orders were only offers which it never accepted. It contends, then, that Commonwealth is not entitled to recovery on these five orders because there was no contract regarding them. Specifically, in this motion, Stanley argues that Commonwealth cannot satisfy the statute of frauds with respect to these five orders.

After the first of Stanley’s deliveries proved to be insufficient, Alan Dick (“Dick”), Commonwealth’s manager of metal purchasing, and David Friedman (“Friedman”), an agent for Stanley, began a series of letters, faxes, and emails back and forth which discussed the alleged contract, Stanley’s shortage on the orders, and ways to resolve the problem. Commonwealth attached these documents to its response to Stanley’s motion for summary judgment because, it argues, they satisfy the statute of frauds.

DISCUSSION

Summary 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 of material fact and *772 that the moving party is entitled to a judgment as a matter of law.” Fed. R.Civ.P. 56(c); see. Candemn Pharmacol, Ltd. v. Elder Pharmaceuticals, Inc., 862 F.2d 597, 601 (6th Cir.1988). The party moving for summary judgment bears the burden of demonstrating the absence of a genuine issue of material fact. Celotex Corp. v. Catrett, 477 U.S. 817, 324, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986).

However, the moving party’s burden may be discharged by demonstrating that there is an absence of evidence to support an essential element of the nonmoving party’s case for which he or she has the burden of proof. Celotex Corp., 477 U.S. at 323, 106 S.Ct. 2548. Once the moving party demonstrates this lack of evidence, the burden passes to the nonmoving party to establish, after an adequate opportunity for discovery, the existence of a disputed factual element essential to his or her case with respect to which he or she bears the burden of proof. Id. If the record taken as a whole could not lead the trier of fact to find for the nonmoving party, the motion for summary judgment should be granted. Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986).

Statute of Frauds

In its motion, Stanley argues that Commonwealth is prohibited from recovering on the alleged oral contract by Kentucky’s statute of frauds, KRS § 355.2-201(1). This shifts the burden to Commonwealth to establish that it can satisfy the statute of frauds. Commonwealth contends that it overcomes this burden for several reasons. It argues, first, that the correspondence between Dick and Friedman provides enough detail of the alleged contract to make it enforceable. Because we agree with Commonwealth on this point, we do not discuss the remaining arguments.

The statute of frauds forbids the enforcement of an oral contract unless there is “some writing sufficient to indicate that a contract for sale has been made.... ” Id. Kentucky courts interpret this requirement loosely. Lonnie Hayes & Sons Staves, Inc. v. Bourbon Cooperage Co., 777 S.W.2d 940, 942 (Ky.App.1989)(“All that is required is that the writing afford a basis for believing that the offered oral evidence rests on a real transaction.”). The UCC drafters’ comments explain that the required writing has only three definite and invariable requirements: “First, it must evidence a contract for the sale of goods; second, it must be ‘signed,’ a word which includes any authentication which identifies the party to be charged; and third, it must specify a quantity.” UCC § 2-201, off.com.l. At a minimum, then, these three elements must be present in order for Commonwealth to enforce the oral contract allegedly negotiated between the parties in October of 1998.

Commonwealth has attached several letters, emails and faxes to its responsive brief which it claims satisfy the statute of frauds. In one dated August 30, 1999, Friedman writes, “Stewart and I want to avoid legal proceedings or arbitration very much but at the same time we were completely misinformed and ill-advised when we took the orders in question.” (Def.Mem.Resp.Summ.J., Ex.C.) Friedman then proposes a resolution for the “open orders” which includes a list titled, “Quantity Unshipped.” (Id.) The figures from this list correspond precisely to the amounts Commonwealth alleges it ordered minus the amounts purportedly delivered by Stanley on three of the purchase orders.

This letter, if admissible, satisfies the statute of frauds. First, it is constructively signed by Friedman, a representative of Stanley. Second, it specifies a quantity which is equivalent to the alleged contract amount and refers to the purchase orders *773 which also contain a quantity term. Finally, it evidences a contract for the sale of goods.

Friedman does write in the past tense about Stanley’s acceptance of Commonwealth’s orders. However, in order to satisfy the statute of frauds, “the writing ... need not be sent with the intent to acknowledge a contract.” 1 James J. White And RobeRT S. SummeRS, Uniform Commercial Code § 2-4 (4th ed.1995).

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186 F. Supp. 2d 770, 2001 U.S. Dist. LEXIS 23680, 2001 WL 1775359, Counsel Stack Legal Research, https://law.counselstack.com/opinion/commonwealth-aluminum-corp-v-stanley-metal-associates-kywd-2001.