Mitchell v. Central National Gattesman, Inc.

CourtSuperior Court of Maine
DecidedNovember 28, 2017
DocketCUMbcd-re-17-04
StatusUnpublished

This text of Mitchell v. Central National Gattesman, Inc. (Mitchell v. Central National Gattesman, Inc.) is published on Counsel Stack Legal Research, covering Superior Court of Maine primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Mitchell v. Central National Gattesman, Inc., (Me. Super. Ct. 2017).

Opinion

STATE OF MAINE SUPERIOR COURT CUMBERLAND, ss. BUSINESS AND CONSUMER COURT LOCATION: PORTLAND ,/ DOCK.ET NO. BCD-RE-17-04 (consolidated with BCD-RE-17-03 & BCD-CV-17-28)

KEITH W. MITCHELL, ) d/b/a/ KEITH W. MITCHELL & ) SONS TRUCKJNG, ) . ) Plaintiff, ) COMBINED ORDER ON ) PLAINTIFF KEITH W. v. ) MITCHELL'S MOTION FOR ) PARTIAL SUMMARY JUDGMENT CENTRAL NATIONAL ) AND DEFENDANTS CENTRAL GOTTESMAN, INC. ) NATIONAL GOTTESMAN'S & AND ) S.D. WARREN COMPANY'S S.D. WARREN COMPANY, d/b/a ) MOTION FOR SUMMARY SAPP! NORTH AMERICA, ) JUDGMENT ) Defendants.

Defendants Central National Gottesman, Inc. ("CNG") and S.D. Warren Company d/b/a

Sappi North America ("Sappi") (collectively "Defendants") have moved for summaty judgment

in their favor on all counts of Plaintiff Keith W. Mitchell, d/b/a Keith W. Mitchell and Sons

Trucking's ("Mitchell") complaint. Mitchell filed his own motion for partial summary judgment

on Count I, Count II, and Count IV of his complaint. The Defendants oppose Mitchell's motion

for partial summary judgment; MitcheJI opposes Defendants' motion for summary judgment as to

all counts except Count IV. Pursuant to its discretionary authority, the Court chose to rule on the

motions without hearing. M.R. Civ. P. 7(b)(7).

FACTUAL BACKGROUND

Red Shield Acquisition, LLC, ("Red Shield") owned and operated a pulp mill in Old Town,

Maine beginning in 2008. (Defendant's Statement of Material Facts ("Def's S.M.F.") at ,r 1.)

1 Earlier in 2014, Red Shield was SL1ffering from financial issues that caused wood chip suppliers to

stop selling to Red Shield out of fear that they would not be paid. (Defs S.M.F. f 3.) CNG, which

already purchased and resold Red Shield's pulp, implemented a solution to this problem whereby

CNG would purchase the woodchips from suppliers and then resell them to Red Shield. (Def's

S.M.F. ,r,r 2, 4-6.)

Notwithstanding CNG becoming the nominal purchaser of chips, Red Shield carded on not

just in making pulp, but also in contracting with suppliers to obtain woodchips. (Def's S.M.F. ~

11.) Although Red Shield was still contracting with woodchip suppliers, as it had prior to CNG's

new role as woodchip purchaser> these woodchips were now subject to a hailment agreement whereby CNG held title to the woodchips but Red Shield retained possession of the chips until

they entered the pulp manufacturing process. (Def's S.M.F. ~ 9, 11.) (Id. ~~ 6-8). CNG further

prntected itself by filing a Uniform Commercial Code financing statement with the Delaware

Department of State covering the woodchips supplied by CNG to Red Shield. (Def's S.M.F. ~ LO.)

Although this arrangement kept Red Shield afloat for several months, Red Shield ceased operation

sometime in August 2014. (Defs S.M.F. if 20.)

On July 23, 2014, Mitchell transpmted a load of woodchips from Portage, Maine to Red

Shield's mill in Old Town> Maine. (Plaintiff's Statement of Material Facts ("PJ's S.M.F.") at~~ 4­

5.) Mitchel I was unaware of the bailment agreement between CNG and Red Shield. (Pl.' s S.M.F.

,r 6.) It is not clear whether Mitchell was otherwise aware that CNG held title to the woodchips he delivered. (Pl's S.M.F. 15; Def's S.M.F. 16,)

After Red Shield ceased operations, CNG scrambled to find buyers for the woodchips.

(Def's S.M.F. 121.) CNG settled on Sappi and arranged for the woodchips' delivery to Sappi's

mill in Skowhegan, Maine. (Id.) For its patt, Sappi understood tba~ although the woodchips were

2 held at Red Shield's facility in Old Town, CNG owned the chips and could sell them to Sappi.

(Def's S.M.F. 122.)

As he had not been paid for the July 23 woodchip load, Mitchell recorded a Hemlock Bark,

Cordwood and Pulpwood Lien ("H.B.C.P. Lien") at the Penobscot County Registry of Deeds on

August 19, 2014. (Pl's S.M.F. ~ 7.) On August 28, 2014, Mitchell informed CNG and Sappi that

he claimed a H.B.C.P. Lien on Red Shield's woodchips and real estate. (Pl's S.M.F. ~~ 23-24;

Defs S.M.F. ,r~ 8-9.) CNG contested the ongoing validity of that lien. (Pl's S.M.F. if 25.) Mitchell

proceeded to obtain a writ of attachment against Red Shield in Houlton District Court on

September 12, 2014 in orde1· to enforce the H.B.C.P. Lien. (Pl's S.M.F. 1 35.) Mitchell

subsequently recorded the writ of attachment in the Penobscot County Registry of Deeds. (Id.)

PROCEDURAL POSTURE This case has a-complicated procedural history. It has been assigned three unique docket

numbers over the past thl'ee years as it wended its way through three Maine state courts and

overlapped briefly with the litigation of Red Shield's bankruptcy in the U.S. Banla.uptcy Court for

the District of Maine.

The Defendants are the only remaining defendants in a case that, as originally filed in

Houlton District Court on September 10, 2014, named Red Shield as defendant and listed Sappi

and CNG as mere parties-inwinterest. (Pl's S.M.F. ,r 15; Def s S.M.F. ,r,r 28-29.) On October 4,

2014, Mitchell filed another suit .against Red Shield in Penobscot Superiot Court. (Defs S.M.F. f

31.) On May 25, 2017, Mitchell filed an amended complaint in Houlton District Court naming

only CNG and Sappi as defendants. (Pl's S.M.F. ,r 34.) The Penobscot Superior Cou1t action has

been consolidated with the Houlton District Court actions and the case has been transferred here

to the Business and Consumer Court. (Pl's S.M.F. ,r 35.)

3 While the 2014 cases were pending, Red Shield's invohmtary Chapter 7 bankruptcy case

commenced. (Pl's S.M.F. ~26.) On October 10, 2014, one of Red Shield's creditors filed a petition

in the U.S. Bankruptcy Court for the District of Maine, seeking Red Shield's involuntary

bankruptcy pursuant to Chapter 7 of the U.S. Banlu·uptcy Code. (Id.) The upshot of those

proceedings was that a company called Expern Old Town, LLC ("Expera") p1.1rchased substantially

all of Red Shield's assets and assumed Mitchell's purpo1ted liens on Red Shield's former property

on Decembei· 5, 2014. (Defs S.M.F. 132.) On December 30, 2014, Mitchell released the H.B.C.P.

• Lien and a mechanic's lien he claimed on Expera's property. (Def's S.M.F. ~ 33.)

Mitchell brings several causes of action against CNG and Sappi, all with the goal of

recovering p~yment for his delivery of the July 23 woodchip load. AU of Mitchell's claims against

CNG and Sappi are now before lhis Court on these dueling motions for summary judgment. (Pl's

S.M.F. if 35.)

STANbARD OF REVIEW .

Summary judgment is granted to a moving party when "there is no genuine issue as to any

material fact" and the moving party "is entitled to judgment as a matter of law." M.R. Civ. P. 56(c).

A material fact is one capable of affecting the outcome of the litigation. Savell v. Duddy, 2016 ME

139, ,r 19, 147 A.3d 1179. A genuine issue exists where the ju1'Y would be required to ''choose

between competing versions of the truth.,, MP. Assocs. v. Liberty, 2001 ME 22, ~ 12, 771 A.2d

1040. "A party seeking to avoid surrunary judgment must addoce prima facie evidence as to each

element of a claim or defense that the party asserts." Savell, 2016 ME 139, ,r 18, 147 A.3d 1179.

DISCUSSION

I. COUNT I: SECURITY INTEREST

In Count I, Mitchell seeks declarato1y relief and an award of damages pursuant to a

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