rejecting an alleged unilateral mistake 8 because there was no evidence that the defendants were aware of 9 such mistake, or that a reasonable person would have known of 10 the mistake
How later courts described this case
- rejecting an alleged unilateral mistake 8 because there was no evidence that the defendants were aware of 9 such mistake, or that a reasonable person would have known of 10 the mistake
- barring admission of evidence of an oral 20 agreement to extend the time to close on the sale of commercial 21 properties because the purchase agreement and written extensions 22 were unambiguous and fully integrated
- rejecting a claimed mutual mistake because reformation 12 would be inequitable after six years of performance without 13 objection
- “Summary judgment is 19 not appropriate” if a reasonable jury could find in the 20 plaintiff’s favor.
Written by the judges who cited it.
The opinion
1 UNITED STATES BANKRUPTCY COURT
EASTERN DISTRICT OF CALIFORNIA
2 FRESNO DIVISION
3
4 In re ) Case No. 18-11651-B-11
)
5 GREGORY JOHN te VELDE, )
)
6 Debtor. )
)
7 )
)
8 RANDY SUGARMAN, Ch. 11 Trustee, ) Adv. Proceeding No. 19-1033
) (Consolidated by order (Doc.
9 Plaintiff, ) #94) for trial purposes only)
)
10 v. ) DCN: MB-3
)
11 IRZ CONSULTING, LLC (aka) IRZ )
Date: October 26, 2022
Construction Division LLC, )
Time: 11:00 a.m.
12 )
Place: U.S. Courthouse
Defendant. )
2500 Tulare Street
13 ) Courtroom 13, 5th Floor
) Fresno, California
14 ) Judge: Hon. René Lastreto II
IRZ CONSULTING, LLC )
15 (aka) IRZ Construction Division )
LLC, )
16 )
Third-Party Plaintiff, )
17 )
v. )
18 )
U.S. FARM SYSTEMS; 4 CREEKS, )
19 INC., JOHN FAZIO (dba Fazio )
Engineering); DARI-TECH, INC.; )
20 LASER LAND LEVELING, INC.; MAAS )
ENERGY WORKS, INC.; GEORGE )
21 CHADWICK (dba George Chadwick )
Consulting); VALMONT NORTHWEST, )
22 INC.; NUCOR BUILDING SYSTEMS )
UTAH LLC, )
23 )
Third-Party Defendants. )
24 )
)
25
26 REPORT AND RECOMMENDATION ON PLAINTIFF RANDY SUGARMAN’S
FIRST MOTION FOR PARTIAL SUMMARY JUDGMENT
27
28
1 —————————————————————————————
2 John MacConaghy, MacCONAGHY & BARNIER, PLC, Sonoma, CA, for
chapter 11 trustee Randy Sugarman, Plaintiff.
3
Benjamin P. Tarczy, MILLER NASH LLP, Portland, OR, for IRZ
4 Consulting, LLC, Defendant/Third-Party Plaintiff.
5 —————————————————————————————
6 RENÉ LASTRETO II, Bankruptcy Judge:
7
8 INTRODUCTION
9 Summary judgment should not be granted unless the moving
10 party shows both that there is no genuine dispute as to any
11 material fact and that movant is entitled to judgment as a
12 matter of law.1 Civ. Rule 56 (Rule 7056) (emphasis added). Here,
0F
13 the plaintiff chapter 11 liquidating trustee asks for partial
14 summary judgment on the objection to claim allegations of his
15 adversary complaint because the defendant was an unlicensed
16 contractor who is therefore barred from perfecting liens and
17 suing for sums owed. The defendant disagrees, insisting that the
18 party named in the underlying contracts is its construction
19 division, thus enjoying the benefits and protections of its
20 contractor’s license.
21 Finding material factual disputes remain, the court
22 recommends the motion for partial summary judgment be DENIED.
23 ///
24 ///
25
1 Unless otherwise indicated, references to: (i) “Civ. Rule” will be to
26
the Federal Rules of Civil Procedure; (ii) “Rule” will be to the Federal
Rules of Bankruptcy Procedure; (iii) “FRE” will be to the Federal Rules of
27 Evidence; (iv) “LBR” will be to the Local Rules of Practice for the United
States Bankruptcy Court, Eastern District of California; and (v) all chapter
28
1 PROCEDURAL HISTORY
2 Chapter 11 liquidating trustee Randy Sugarman (“Plaintiff”)
3 moves for partial summary judgment on the first claim for relief
4 of his complaint against IRZ Consulting, LLC (“Defendant” or
5 “IRZ”). Pl.’s Mot. Summ. J., Doc. #424. That claim is an
6 objection to Defendant’s Proof of Claim No. 19 filed June 4,
7 2018, in the amount of $347,057.56. Cf. Compl., Doc. #1.
8 Defendant objects to Plaintiff’s evidence and opposes
9 summary judgment. Def.’s Evid. Objs. & Mem. P. & A., Docs. #459
10 & #461.
11 Plaintiff replied and submitted its own evidentiary
12 objections.2 Pl.’s Reply & Evid. Objs., Docs. #473 & #475.
1F
13 This motion for summary judgment was filed on 42 days’
14 notice as required by LBR 7056-1 and in conformance with Rule
15 7056 and Civ. Rule 56. This matter was originally scheduled to
16 be heard on October 26, 2022. Notice, Doc. #425. The court took
17 the matter under submission and indicated that it would
18 subsequently issue a report and recommendation to the District
19 Court. Civ. Mins. (Oct. 26, 2022), Doc. #520.
20 These are the court’s findings and recommendations for de
21 novo consideration by the District Court as to Plaintiff’s
22 motion for partial summary judgment. The rulings on the
23 evidentiary objections will be included at the end of this
24 report.
25 ///
26 ///
27
2 The court granted Plaintiff’s request for an extension of time to
28
1 REQUEST FOR JUDICIAL NOTICE
2 Plaintiff requests the court take judicial notice of
3 certain documents filed in the underlying chapter 11 bankruptcy
4 case, Bankr. Case No. 18-11651 (“Bankr”). RJN, Doc. #431. The
5 court may take judicial notice of all documents and other
6 pleadings filed in this adversary proceeding, the underlying
7 bankruptcy case, filings in other court proceedings, and public
8 records. FRE 201; Bank of Am., N.A. v. CD-04, Inc. (In re Owner
9 Mgmt. Serv., LLC), 530 B.R. 711, 717 (Bankr. C.D. Cal. 2015).
10 The court takes judicial notice of the requested documents, as
11 well as the pleadings filed in this adversary proceeding, and
12 the underlying chapter 11 bankruptcy case, but not the truth or
13 falsity of such documents as related to findings of fact. In re
14 Harmony Holdings, LLC, 393 B.R. 409, 412-15 (Bankr. D.S.C.
15 2008).
16
17 JURISDICTION
18 The United States District Court for the Eastern District
19 of California has jurisdiction of this adversary proceeding
20 under 28 U.S.C. § 1334(b) because this adversary proceeding
21 arises in and is related to a case under title 11 of the United
22 States Code. Under 28 U.S.C. § 157(a), the District Court has
23 referred this matter to this court. Part of this proceeding –
24 the claim objection - is “core” under 28 U.S.C. § 157(b)(2)(B).
25 Furthermore, the District Court denied an early motion to
26 withdraw the reference under 28 U.S.C. § 157(c)(1) and allowed
27 this court to supervise discovery, rule on non-dispositive
28 motions, and issue a Report and Recommendation for de novo
1 review to the District Court on dispositive motions.3 Venue is
2F
2 proper in this district pursuant to 28 U.S.C. §§ 1408 and
3 1409(a).
4
5 BACKGROUND
6 On September 30, 2015, Gregory te Velde (“Debtor”) and “IRZ
7 Construction Division, an Oregon limited liability company”
8 (“ICD”) executed a Work Order (“Work Order”) providing that ICD
9 would provide certain construction design services to Debtor for
10 the “Willow Creek Dairy” on a time and material basis. Work
11 Order, Doc. #463, Ex. A. The price was not to exceed
12 $100,000.00. Id. The Work Order was signed by Debtor and Fred
13 Ziari, as an agent of ICD. Id. at 3.
14 On or about November 17, 2015, Debtor and Ziari executed a
15 new agreement entitled Design, Engineer, and Project Management
16 Services for Greg Tevelde Willow Creek Dairy Construction
17 Project November 2015 (“Contract”), generally providing that
18 Defendant would perform 21 separate construction related tasks
19 for the Willow Creek Dairy. Id., Ex. B; Docs. #427, Ex. 6. Ziari
20 signed as President of “IRZ Consulting, LLC (d/b/a IRZ
21 Construction Division through Wayne Downey as Director of
22 Construction)[,]” which is a duly licensed Oregon contractor and
23 a duly organized Oregon limited liability company. Id. at 15.
24 Debtor defaulted on his obligation to timely pay for
25 Defendant’s services. Downey Decl., Doc. #462, ¶ 9. On July 12,
26 2017, ICD and Defendant stopped their work on the project. Ibid.
27
3 See Order Denying Defendant’s Motion to Withdraw Reference, Doc. #162;
28 cf.
1 Defendant recorded an Oregon form Construction Claim of Lien on
2 the project, alleging that it “furnished labor, equipment,
3 material, services, supervision, and plans, drawings and surveys
4 actually used in the construction of improvements” on the
5 subject real property “. . . commencing on or about September
6 30, 2015.” Id. at ¶ 10; Constr. Claim of Lien, Doc. #463, Ex. C.
7 On November 2, 2017, Defendant filed a Complaint (Construction
8 Lien Foreclosure; Breach of Contract; Quantum Meruit) in Morrow
9 County, Oregon Circuit Court against Debtor and others, seeking
10 the principal sum of $393,476.81 for the cost of “labor,
11 equipment, material, services, supervision, plans, drawings, and
12 surveys . . . used for the benefit of the Property” from
13 “September 30, 2015, through August 3, 2017.” Id., Ex. D. The
14 state court complaint includes the Work Order and Contract as
15 exhibits.
16 Debtor filed chapter 11 bankruptcy on April 26, 2018. Pet.,
17 Doc. #432, Ex. 1 (Bankr. Doc. #1). On June 4, 2018, Defendant
18 filed its Proof of Secured Claim in the amount of $347,057.56,
19 attaching its mechanics’ lien complaint as an exhibit. Id., Ex.
20 2 (Bankr. Claim 19).
21 On February 11, 2019, Plaintiff sold the property subject
22 to Defendant’s claim of lien pursuant to an Order Authorizing
23 Sale of Real Property Free and Clear of Liens. Order, id., Ex. 3
24 (Bankr. Doc. #1607). The court directed Plaintiff to disburse
25 most of the sales proceeds of the Lost Valley Farm to various
26 parties in interest; however, the court directed Trustee to hold
27 back funds to provide “adequate protection” to Defendant on
28 account of its disputed secured claim (the “Holdback Fund”).
1 Stip. Order, id., Ex. 4 (Bankr. Doc. #1799). The current balance
2 of the Holdback Fund is approximately $659,323.00. Sugarman
3 Decl., Doc. #428.
4 Plaintiff filed this instant action against Defendant on
5 March 8, 2019. The adversary complaint alleges claims for
6 (1) disallowance of Claim 19; (2) damages for breach of
7 contract; (3) damages for negligence; and (4) avoidance of
8 fraudulent transfers. Compl., Doc. #1. The first claim for
9 relief is the subject of this motion: Plaintiff seeks to
10 disallow Defendant’s Claim 19 in full. Mot., Doc. #424.
11
12 DISCUSSION
13 I. Summary Judgment Standard
14 Civ. Rule 56, as incorporated by Rule 7056, applies in
15 adversary proceedings. Under Civ. Rule 56(a), summary judgment
16 should be granted only if the movant shows that there is no
17 genuine dispute as to any material fact and that the movant is
18 entitled to judgment as a matter of law.
19 When considering a motion for summary judgment, facts must
20 be viewed in the light most favorable to the nonmoving party
21 only if there is a “genuine” dispute as to those facts. Civ.
22 Rule 56(c); Scott v. Harris, 550 U.S. 372, 380, 127 S. Ct. 1769,
23 1776 (2007). “[T]he mere existence of some alleged factual
24 dispute between the parties will not defeat an otherwise
25 properly supported motion for summary judgment; the requirement
26 is that there be no genuine issue of material fact.” Anderson v.
27 Liberty Lobby, Inc., 477 U.S. 242, 247-48, 106 S. Ct. 2505,
28 2509-10 (1986).
1 “Where the record taken as a whole could not lead a
2 rational trier of fact to find for the nonmoving party, there is
3 no ‘genuine issue for trial.’” Matsushita Elec. Indus. Co. v.
4 Zenith Radio Corp., 475 U.S. 574, 587, 106 S. Ct. 1348, 1356
5 (1986). “As to materiality, the substantive law will identify
6 which facts are material. Only disputes over facts that might
7 affect the outcome of the suit under the governing law will
8 properly preclude the entry of summary judgment.” Anderson, 477
9 U.S. at 248, 106 S. Ct. at 2510. “[W]hile the materiality
10 determination rests on the substantive law, it is the
11 substantive law’s identification of which facts are critical and
12 which facts are irrelevant that governs.” Ibid.
13 The movant may not argue that its evidence is the most
14 persuasive or “explain away” evidence unfavorable to its
15 defenses; rather, it must show that there are no material facts
16 in dispute, or which can be reasonably resolved by a fact
17 finder. Id. at 250-51, 106 S. Ct. at 2511; Davis v. Team Elec.
18 Co., 520 F.3d 1080, 1089 (9th Cir. 2008) (“Summary judgment is
19 not appropriate” if a reasonable jury could find in the
20 plaintiff’s favor.) (emphasis added).
21 As the movant here, the burden of proof is on Plaintiff.
22 The court must draw all reasonable inferences in the light most
23 favorable to the non-moving party, and therefore in favor of
24 denying summary judgment. Anderson, 477 U.S. at 255, 106 S. Ct.
25 at 2513-14. Further, the non-moving party’s evidence is to be
26 believed, and all justifiable inferences are to be drawn in its
27 favor. Hutchins v. TNT/Reddaway Truck Line, Inc., 939 F. Supp.
28 721, 723 (N.D. Cal. 1996).
1 If a summary judgment motion is properly submitted, the
2 burden shifts to the opposing party to rebut with a showing that
3 there is a genuine issue of material fact. Henderson v. City of
4 Simi Valley, 305 F.3d 1052, 1055-56 (9th Cir. 2002). “The
5 nonmoving party ‘may not rely on denials in the pleadings but
6 must produce specific evidence . . . to show that the dispute
7 exists.’” Barboza v. New Form, Inc. (In re Barboza), 545 F.3d
8 702, 707 (9th Cir. 2008), quoting Bhan v. NME Hosps., Inc., 929
9 F.2d 1404, 1409 (9th Cir. 1991).
10 Ultimately, the court must grant summary judgment if the
11 movant shows that the record, taken as a whole, could not lead a
12 rational trier of fact to find for the nonmoving party as to any
13 fact that might affect the outcome of the suit under the
14 governing law, and the nonmovant does not meet their burden of
15 proof to refute the movant’s claims.
16
17 II. Enforceability of Defendant’s Claim and Lien
18 A.
19 First, Plaintiff argues that Defendant’s claim and lien are
20 unenforceable because they were not continually licensed
21 throughout its performance of work for the Debtor. Pl.’s Mem. P.
22 & A., Doc. #429. Since ICD performed services for the Debtor
23 without a valid contractor’s license, Plaintiff urges that Or.
24 Rev. Statute (“ORS”) § 701.131(1) bars Defendant from enforcing
25 its lien on the Holdback Fund, and bars it from recovering any
26 sums on its proof of claim.4 Id., citing Pincetich v. Nolan, 252
3F
27 4 ORS § 701.131 provides, in relevant part, that “a contractor may not
perfect a construction lien, . . . or commence . . . a claim in a court of
28
1 Or. App. 42, 285 P.3d 759 (2012) (barring a contractor’s claim
2 because of a 14-day suspension in contractor’s license due to
3 lapse in insurance); Stellar J. Corp. v. Smith & Loveless, 580
4 F. App’x 604 (9th Cir. 2014) (barring subcontractor, a Kansas
5 corporation, from pursuing its monetary claim and rejecting all
6 theories raised to avoid the bar because it did not have an
7 Oregon contractor’s license when it provided labor and
8 materials).
9 The core of Plaintiff’s argument relies on the alleged fact
10 that, as of September 30, 2015, ICD was an independent entity
11 performing construction services without being duly organized as
12 a limited liability company, nor having a contractor’s license
13 issued by the State of Oregon. Pl.’s Mem. P. & A., Doc. #429,
14 citing MacConaghy Decl., Docs. ##426-27, Exs. 1-3.
15 In response, Defendant claims that ICD is a division of
16 Defendant and an assumed business name of Defendant, so it
17 performed services under Defendant’s contractor’s license.
18 Def.’s Stmt. Undisp. Facts, Doc. #460, citing Downey Decl.,
19 Doc. #462, ¶¶ 5-6. Plaintiff relies on ICD being named in the
20 Work Order and Contract, but ICD is not and has never been a
21 separate legal entity from Defendant. Since Plaintiff has
22 conceded that Defendant is a duly licensed Oregon contractor and
23 a duly organized Oregon limited liability company, and Defendant
24 recorded a lien and filed a complaint related to the project,
25 Defendant argues that ORS § 701.131 does not apply to its lien,
26 complaint, and claim because it was in fact a duly licensed
27
of any contract for work that is subject to this chapter, unless the
28
1 contractor and duly organized limited liability company under
2 Oregon law at the time it performed services for Debtor.
3 Defendant distinguishes Pincetich and Stellar as being
4 inapplicable: both involved contractors who acknowledged that
5 they lacked an active, valid contractor’s license, but Defendant
6 here was a licensed Oregon contractor at all relevant times.
7 Def.’s Mem. P. & A., Doc. #461. Defendant alternatively argues
8 that neither the Work Order nor the Contract required it to
9 construct, alter, repair, add to, subtract from, improve,
10 inspect, move, wreck or demolish any structure at all, so its
11 services did not fall within the scope of the work of a
12 “contractor” as defined in ORS § 701.005(5).5 So even assuming,
4F
13 arguendo, that Defendant was not a licensed contractor at all
14 relevant times, it insists that this motion should be denied
15 because its services on this project did not fall within the
16 scope of those performed by a “contractor” under ORS
17 § 701.005(5).
18 Plaintiff’s reply argues (1) Defendant’s effort to
19 substitute a new contracting party into the Work Order is barred
20 by the parol evidence rule, (2) Defendant cannot avail itself of
21 the “mistake” exception to the parol evidence rule, and (3)
22 Defendant is judicially estopped from claiming that the work it
23 allegedly performed did not require an Oregon contractor’s
24 license. Pl.’s Reply, Doc. #473.
25
5 ORS § 701.005(5) defines a “contractor” as: “[a] person that, for
26
compensation or with the intent to sell, arranges or undertakes or offers to
undertake or submits a bid to construct, alter, repair, add to subtract from,
27 improve, inspect, move, wreck or demolish, for another, a building, highway,
road, railroad, excavation or other structure, project, development or
28
1 Parol Evidence Rule
2 Plaintiff relies on the parol evidence rule as codified
3 under Oregon law:
4 When the terms of an agreement have been
reduced to writing by the parties, it is to be
5 considered containing all of those terms, and
therefore there can be, between the parties
6 and their representatives or successors in
interest, no evidence of the terms of the
7 agreement, other than the contents of the
writing, except where a mistake or im-
8 perfection of the writing is put in issue by
the pleadings or where the validity of the
9 agreement is the fact in dispute. However this
section does not exclude other evidence of
10 circumstances under which the agreement was
made, or to which it relates, as defined in
11 ORS 42.220, or to explain an ambiguity,
intrinsic or extrinsic, or to establish
12 illegality or fraud. The term “agreement”
includes deeds and wills as well as contracts
13 between the parties.
14 ORS § 41.740.
15 Since Oregon courts routinely bar the admission of parol
16 evidence, Plaintiff maintains that Defendant cannot substitute
17 itself into the Work Order using parol evidence. Pl.’s Reply,
18 Doc. #473, citing Abercrombie v. Hayden Corp., 320 Or. 279, 883
19 P.2d 845 (1994) (barring admission of evidence of an oral
20 agreement to extend the time to close on the sale of commercial
21 properties because the purchase agreement and written extensions
22 were unambiguous and fully integrated); Morton & Assocs., LLC v.
23 McCain Foods USA, Inc., 226 Or. App. 532, 204 P.3d 167 (2009)
24 (affirming summary judgment after concluding that brokerage
25 agreements were completely integrated, and the plaintiff’s
26 claims relied on barred extrinsic evidence).
27 Plaintiff also contends that Defendant cannot avail itself
28 of the “mistake” exception contained in ORS § 41.740 because the
1 mistake was derived from Defendant’s pre-printed form and wholly
2 unilateral. Reformation of a fully integrated, unambiguous
3 contract based on unilateral mistake may only occur in two
4 circumstances: (1) the mistake must have been known to the other
5 party; or (2) the other party has acted inequitably. Pl.’s
6 Reply, Doc. #473, citing Gardner v. Meiling, 280 Or. 665, 572
7 P.2d 1012 (1977) (rejecting an alleged unilateral mistake
8 because there was no evidence that the defendants were aware of
9 such mistake, or that a reasonable person would have known of
10 the mistake); Foster v. Gibbons, 177 Or. App. 45, 33 P.3d 329
11 (2001) (rejecting a claimed mutual mistake because reformation
12 would be inequitable after six years of performance without
13 objection).
14 Judicial Estoppel
15 Lastly, Plaintiff maintains that Defendant is judicially
16 estopped from claiming that the work it allegedly performed did
17 not require an Oregon contractor’s license because Defendant
18 recorded a mechanics’ lien (or “construction lien” under Oregon
19 terminology) and filed a state court action to foreclose it.
20 Under ORS § 701.131, the only entity who can enforce a
21 construction lien is a contractor. Thus, under the doctrine of
22 judicial estoppel, Defendant must be barred from claiming that
23 it was not really acting as a contractor after all. Pl.’s Reply,
24 Doc. #473, citing Hamilton v. State Farm Fire & Cas. Co., 270
25 F.3d 778 (9th Cir. 2001).
26 ///
27 ///
28 ///
1 B.
2 ORS § 41.740 incorporates ORS § 42.220, which states “[i]n
3 construing an instrument, the circumstances under which it was
4 made, including the situation of the subject and of the parties,
5 may be shown so that the judge is placed in the position of
6 those whose language the judge is interpreting.” This language
7 “permits the judge to consider circumstances under which the
8 instrument was executed and the relative situations of the
9 parties.” United States Nat’l Bank v. Guiss, 214 Or. 563, 593,
10 331 P.2d 865, 879 (1958).
11 Plaintiff’s evidence seems to prove that IRZ Consulting,
12 LLC has been licensed by the Oregon Construction Contractors
13 Board (“CCB”) since 2011. Def.’s CCB License, Doc. #427, Ex. 5.
14 The November 2015 Contract identifies the contracting parties as
15 Debtor TeVelde and IRZ Construction Division “a division of IRZ
16 Consulting LLC.” Contract, Id., Ex. 6 at 15. Defendant’s
17 position on ICD’s status is not ideal. The earlier Work Order
18 between the parties identified ICD as “IRZ Construction
19 Division, an Oregon limited liability company.” Work Order,
20 Doc. #463, Ex. A. But it apparently was not a limited liability
21 company when the Work Order was signed. ICD’s CCB License
22 Doc. #427, Ex. 2.
23 There is a genuine factual dispute on this material issue:
24 is ICD an independent entity performing activities requiring a
25 contractor’s license or an assumed business name and division of
26 Defendant that is legally performing services under Defendant’s
27 contractor’s license? Since the record itself contains
28 conflicting information, it cannot be said that “no reasonable
1 jury” would find one classification more believable than the
2 other.
3 The answer to the disputed factual issue may impact the
4 admission of evidence concerning at least the Work Order under
5 the parol evidence rule, but the court need not reach that issue
6 since factual disputes exist as to the license status of ICD.
7 The same is true for Plaintiff’s judicial estoppel argument
8 raised in reply. Whether Defendant is barred by judicial
9 estoppel from claiming an Oregon contractor’s license was
10 unnecessary will depend, in part, on ICD’s license status. See
11 also, New Hampshire v. Maine, 542 U.S. 742, 753, 121 S. Ct.
12 1808, 1816 (2001) (“It may be appropriate to resist application
13 of judicial estoppel ‘when a party’s prior position was based on
14 inadvertence or mistake.’”), quoting John S. Clark Co. v.
15 Faggert & Frieden, P.C., 65 F.3d 26, 29 (4th Cir. 1995).
16 Another impediment to finding an absence of a material
17 factual dispute are the terms of the “integration clauses” in
18 both the Work Order and Contract. Work Order & Contract,
19 Docs. #463, Ex. A at 5 & Ex. B at 21. As relevant here, the
20 provisions state that “[t]his writing is the full and complete
21 agreement between the parties concerning ICD’s services to
22 (CLIENT/OWNER) for the above services and work” (emphasis
23 added). So, the subject of the integration is limited to ICD’s
24 services to Debtor Te Velde for those “services and work”
25 described in both agreements. The integration clause by its
26 terms is limited to ICD’s performance under the agreements. The
27 clause includes nothing more.
28 ///
1 Since it is disputed whether ICD was performing unlicensed
2 contractor activities, or whether it was doing business under
3 Defendant’s valid contractor’s license, the court is unable to
4 recommend granting this motion.
5
6 CONCLUSION
7 Plaintiff has not demonstrated that ICD was performing
8 unlicensed contractor’s services, so this court recommends that
9 | this motion for summary judgment be DENIED. The court will issue
10 a subsequent order setting deadlines for objections to this
11 proposed report and recommendation. The rulings on the parties’
12 evidentiary objections begins on the following page.
13
14
15 Dated: Nov 10, 2022 By the Court
16 Z /
a“
17 Cra
ené Lastreto II, Judge
18 United States Bankruptcy Court
19
20
21
22
23
24
25
26
27
28
1 RULINGS ON EVIDENTIARY OBJECTIONS
2 IRZ’s Objections to the Declaration of John H. MacConaghy
Grounds for
3 Material Objected To: Objections: Court’s Ruling:
1. “Attached to this 1a. Lacks personal 1a. Sustained as to lack
4 Declaration and labeled knowledge. FRE of personal knowledge of
Exhibit 1 is a correct copy 602. IRZ Construction
5 of the Westlaw database Division, LLC’s and/or
printout indicating that IRZ 1b. Best evidence IRZ Consulting, LLC’s
6 Construction Division, LLC rule. FRE 1002-04. status as an Oregon
was not organized as an limited liability
7 Oregon limited liability company.
company until May 31, 2017.”
8 MacConaghy Decl., Doc. #426 1b. Sustained. The
at ¶ 3, Lines 2:9-11. Westlaw corporate
9 records and business
registration search
10 result is not an
official government
11 source and cannot be
used in place of an
12 original writing,
recording, or
13 photograph, and
therefore cannot be used
14 to prove its content.
15 2. “Attached to this 2a. Lacks personal 2a. Sustained as to lack
Declaration and labeled knowledge. FRE of personal knowledge of
16 Exhibit 2 is a correct copy 602. IRZ Construction
of the “license search” Division, LLC’s and/or
17 database maintained by the 2b. Best evidence IRZ Consulting, LLC’s
Oregon Construction rule. FRE 1002-04. status as an Oregon
18 Contractors Board indicating limited liability
that there is no record of company.
19 IRZ Construction Division,
LLC ever being a licensed 2b. Overruled. The
20 contractor in the State of printout from the Oregon
Oregon.” Id. at ¶ 4, Lines Construction
21 2:12-16. Contractors’ license
database can be used to
22 prove whether “IRZ
Construction Division
23 LLC” is a licensed
contractor.
24
25 Doc. #459.
26 ///
27 ///
28 ///
1 Plaintiff’s Objections to the Declaration of Wayne Downey
Grounds for
2 Material Objected To: Objections: Court’s Ruling:
1. “Defendant entered into a 1a. Parol evidence 1a. Overruled. License
3 short-form, 3-page work order rule. status of ICD is still
(the “Work Order”) with in dispute. Also, the
4 Gregory John te Velde. . .” 1b. Best evidence integration clause may
Downey Decl., Doc. #462 at rule. FRE 1002-04. have limited effect.
5 ¶ 2, Lines 2:18-19. Doc. #463.
6 1b. Overruled. A copy of
the Work Order has been
7 filed as an exhibit,
which can be used to
8 prove its contents.
9 2. “The Work Order did not 2a. Parol evidence 2a. Overruled.
call for Defendant to rule. Integration clause may
10 arrange, undertake, offer to have limited effect.
undertake, or submit a bid to 2b. Best evidence Doc. #463.
11 construct, alter, repair, add rule. FRE 1002-04.
to, subtract from, improve, 2b. Sustained.
12 inspect, move, wreck or
demolish any structure for
13 Debtor.” Id. at ¶ 2, Lines
2:23-25.
14
3. “The Contract provided 3a. Parol evidence 3a. Overruled. Statement
15
that Defendant act as rule. is not inconsistent with
“Project Manager” to perform terms of contract.
16
review, oversight, design, 3b. Best evidence
and engineering tasks, with rule. FRE 1002-04. 3b. Overruled. No
17
Debtor to act as General question raised as to
Contractor for the project. authenticity of
18
The Contract did not call for duplicate. Otherwise,
Defendant to arrange, sustained.
19
undertake, offer to
undertake, or submit a bid to
20
construct, alter, repair, add
to, subtract from, improve,
21
inspect, move, wreck or
demolish any structure for
22 Debtor.” Id. at ¶ 3, Lines
2:1-5.
23
24 ///
25 ///
26 ///
27 ///
28 ///
1 . : Grounds for .
Material Objected To: □ Court’s Ruling:
Objections:
2 4. The Work Order mistakenly 4a. Lacks 4a. Overruled. Wayne
names “IRZ Construction foundation/personal | Downey is the Director
3 Division,” as opposed to the knowledge. FRE 602. | of Construction at IR4Z
correctly named “IR4Z and signed as Director
4 Construction Division (ICD) 4b. Parol evidence on behalf of ICD in the
(a division of IRZ Consulting | rule. Contract. Mr. Downey has
LLC)” named in the Contract, personal knowledge as
as party to the Work Order.” 4c. Best evidence director and as IRZ’s
6 Id. at 5, Lines 2:8-10. rule. FRE 1002-04. agent to know about the
accuracy of the Work
7 Order.
8 4b. Overruled. ICD
license status is a
9 disputed fact. Also,
integration clause may
10 have limited effect.
11 4c. Overruled. No
genuine question as to
12 authenticity. FRE 1003
13 5. “At all times, the parties | 5. Lacks 5. Overruled as to IRZ’s
understood the Work Order and | foundation/personal | understanding because
14 Contract to be between knowledge. FRE 602. | Wayne Downey, as
Defendant and Debtor.” Id. at director and as an agent
15 1 5, Lines 2:10-11. of IRZ, has personal
knowledge of IRZ’s
16 understanding of the
Work Order and Contract.
17 Sustained as to Debtor’s
understanding of the
18 Work Order and Contract.
19
20 | Doc. #475.
21
Dated: Nov 10, 2022 By the Court
heise tec
24 ené Léstreto II, Judge
55 United States Bankruptcy Court
26
27
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1 Instructions to Clerk of Court
Service List - Not Part of Order/Judgment
2
The Clerk of Court is instructed to send the Order/Judgment
3 or other court generated document transmitted herewith to the
parties below. The Clerk of Court will send the Order via the
4 BNC or, if checked , via the U.S. mail.
5
Tracy A. Agrall
6 246 W. Shaw
Fresno, CA 93704-2644
7
Steve Alfieris
8 502 West Grangeville Blvd
Hanford, CA 93230-2857
9
Hagop T. Bedoyan
10 7647 N. Fresno Street
Fresno, CA 93720-2578
11
Michael Brown
12 Law Offices of Michael Brown
1809 West Main Street, Suite H
13 Visalia, CA 93291-4464
14 D. Gary Christensen
Miller Nash Graham and Dunn LLP
15 3400 U.S. Bancorp Tower 111 S.W. 5th Ave 93291
Portland, OR 97204
16
Paula C. Clark
17 502 West Grangeville Blvd
Hanford CA 93230
18
Ronald A. Clifford
19 1100 Town and Country Rd., Ste 1250
Orange, CA 92868
20
Michael A. Dias
21 502 W Grangeville Blvd
Hanford, CA 93230-2857
22
Anthony Dutra
23 Hanson Bridgett LLP
425 Market Street
24 26th Floor
San Francisco, CA 94105-5401
25
Mark F. Enenbach
26 McGrath North Mullin and Kratz, PC, LLO
First National Tower #3700
27 1601 Dodge St
Omaha, NE 68102-1650
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1 David A. Foraker
111 SW 5th Ave #3400
2 Portland, OR 97204
3 Vanessa Triplett Kuchulis
Miller Nash, LLP
4 111 S. W. 5th Ave #3400
Portland, OR 97204-3614
5
Sanford R. Landress
6 3400 U.S. Bancorp Tower
111 SW 5th Ave
7 Portland, OR 97204
8 John H. MacConaghy
645 First St., West, Suite D
9 Sonoma, CA 95476-7044
10 Aaron Moore
1600 West St.
11 Redding, CA 96001-1726
12 James J. Niemeier
First National Tower, Suite 3700
13 1601 Dodge Street
Omaha, NE 68102-1637
14
Kyle D. Sciuchetti
15 111 SW Fifth Ave #3400
Portland, OR 97204-3614
16
Lindy H. Scoffield
17 3043 Gold Canal Dr #100
PO Box 269127
18 Sacramento, CA 95826-9127
19 Shanon J Slack
Slack Law Group APC
20 2030 Main Street
Suite 1300
21 Irvine, CA 92614-7220
22 Randy Sugarman
583 1st St W
23 Sonoma, CA 95476-6638
24 Benjamin P. Tarczy
US Bancorp Tower
25 111 SW Fifth Avenue, Suite 3400
Portland, OR 97204
26
Duncan C. Turner
27 Badgley Mullins Turner PLLC
19929 Ballinger Way NE #200
28 Seattle, WA 98155-8208
1 Scot M. Tyler
Moore & Van Allen PLLC
2 100 N. Tryon St #4700
Charlotte, NC 28202-4003
3
Kurt F. Vote
4 265 E. River Park Circle, Suite 310
Fresno, CA 93720-1580
5
Riley C. Walter
6 265 E. River Park Circle Suite 310
Fresno, CA 93720-1580
7
Neal L. Wolf
8 425 Market St 26th Fl
San Francisco, CA 94105
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