United States District Court, W.D. Arkansas, Texarkana Division
BMO HARRIS BANK N.A. PLAINTIFF
UNIQUE FREIGHT SYSTEMS, INC. and KENNETH DOUGAN DEFENDANTS
O. Hickey United States District Judge
the Court is Plaintiff BMO Harris Bank N.A.'s
(“BHB”) Motion for Summary Judgment. ECF No. 9.
Defendants Unique Freight Systems, Inc. and Kenneth Dougan
(collectively “Defendants”) have filed a
response. ECF No. 14. BHB has filed a reply. ECF No. 26. The
Court finds this matter ripe for consideration.
a breach of contract case. Defendant Unique Freight Systems,
Inc. entered into two separate Loan and Security Agreements
(the “Agreements”) with BHB to finance the
purchase of eight Kenworth T660-Series semi-trucks. Defendant
Kenneth Dougan personally guaranteed that Unique Freight
Systems would satisfy its repayment obligations. Unique
Freight Systems subsequently defaulted on the loans, and
Dougan failed to remedy the default. BHB brings this action
to recover the balance owed on the Agreements.
September 18, 2014, Unique Freight Systems entered into a
Loan & Security Agreement, (“Agreement 1”)
with BHB in the amount of $549, 526.32 to finance the
purchase of six 2012 Kenworth T660-Series semi-trucks. Unique
Freight Systems agreed to make monthly payments in the amount
of $9, 812.97 beginning on November 3, 2014, for a term of 56
months. That same day, Dougan executed a “Continuing
Guaranty” personally and unconditionally guaranteeing
Unique Freight System's performance of all “present
and future liabilities, obligations and indebtedness”
February 20, 2015, Unique Freight Systems entered into a
second Loan & Security Agreement (“Agreement
2”) with BHB in the total amount of $219, 526.80. This
agreement was to finance the purchase of two 2013 Kenworth
T660-Series semi-trucks. Under Agreement 2, Unique Freight
Systems agreed to make monthly payments in the amount of $3,
658.78 beginning on April 1, 2015, for a term of 60 months.
October 1, 2015, Unique Fright Systems defaulted under the
terms of Agreement 2 by failing to make the required minimum
monthly payments. Likewise, on October 3, 2015, Unique
Freight Systems also defaulted under the terms of Agreement 1
by failing to make the required payments. On February 2,
2016, Unique Freight Systems and Dougan, as the guarantor of
Unique Freight Systems, were informed by letter that Unique
Freight Systems was in default under the Agreements and that
the accelerated balance owed to BHB would be due in ten days.
did not pay the accelerated balance in the prescribed time.
BHB alleges that the trucks were then retrieved and sold over
the course of three heavy equipment auctions with the
proceeds being applied towards Defendants' outstanding
loan obligations. Defendants admit that the trucks were
retrieved by BHB. However, Defendants contest whether the
trucks were ever actually sold. Defendants further contend
that if the trucks were indeed sold then the disposition
sales were not commercially reasonable based on the prices
BHB claimed to receive for the trucks at auction.
the disposition sales, a balance of $578, 835.35 remained due
under the Agreements. On November 1, 2017, BHB commenced this
action to recover the outstanding balance. ECF No. 1. On July
9, 2018, BHB filed its Motion for Summary Judgment and
supporting documents. ECF Nos. 9-11.
judgment is appropriate if the movant shows that there is no
genuine dispute as to any material fact and the movant is
entitled to judgment as a matter of law.” Hess v.
Union Pac. R.R. Co., 898 F.3d 852, 856 (8th Cir. 2018)
(citation omitted). Summary judgment is a “threshold
inquiry of . . . whether there is a need for trial-whether,
in other words, there are genuine factual issues that
properly can be resolved only by a finder of fact because
they reasonably may be resolved in favor of either
party.” Anderson v. Liberty Lobby, Inc., 477
U.S. 242, 250 (1986). A fact is material only when its
resolution affects the outcome of the case. Id. at
248. A dispute is genuine if the evidence is such that it
could cause a reasonable jury to return a verdict for either
party. Id. at 252.
deciding a motion for summary judgment, the Court must
consider all the evidence and all reasonable inferences that
arise from the evidence in a light most favorable to the
nonmoving party. Nitsche v. CEO of Osage Valley Elec.
Co-Op, 446 F.3d 841, 845 (8th Cir. 2006). The moving
party bears the burden of showing that there is no genuine
issue of material fact and that it is entitled to judgment as
a matter of law. See Enter. Bank v. Magna Bank, 92
F.3d 743, 747 (8th Cir. 1996). The nonmoving party must then
demonstrate the existence of specific facts in the record
that create a genuine issue for trial. Krenik v. Cnty. of
LeSueur, 47 F.3d 953, 957 (8th Cir. 1995). However, a
party opposing a properly supported summary judgment motion
“may not rest upon mere allegations or denials . . .
but must set forth specific facts showing that there is a
genuine issue for trial.” Anderson, 477 U.S.
argues that there are no genuine disputes of material fact
and that it is entitled to summary judgment. Defendants do
not challenge the validity of the Agreements or the fact that
they were in default. However, Defendants maintain that summary
judgement is improper because the ...