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NATIONAL-STANDARD CO. v. CLIFTON AVE. CORP.

August 2, 1991

NATIONAL-STANDARD COMPANY, PLAINTIFF,
v.
CLIFTON AVENUE CORP. AND HARTZ MOUNTAIN INDUSTRIES, INC., DEFENDANTS.



The opinion of the court was delivered by: Lechner, District Judge.

OPINION

This is an action brought by National-Standard Company ("National-Standard") against Clifton Avenue Corp. ("Clifton") and Hartz Mountain Industries, Inc. ("Hartz") (collectively, "Defendants") to enforce a real estate purchase contract. Jurisdiction is alleged pursuant to 28 U.S.C. § 1332 and appears to be appropriate.

Currently before the court is the motion of Defendants for summary judgment pursuant to Fed.R.Civ.P. 56.*fn1 For the reasons which follow, summary judgment is granted in favor of Defendants.

FACTS

National-Standard is a corporation organized under the laws of the State of Delaware and maintains its principal place of business in Michigan. Clifton is a corporation organized under the laws of and maintains its principal place of business in the State of New Jersey. Hartz is a corporation organized under the laws of the State of New York and maintains its principal place of business in New Jersey.

On 2 August 1987, National-Standard and Clifton entered into a real estate purchase contract (the "Contract"). The Contract provided National-Standard agreed to sell to Clifton approximately thirty-five acres of real property (the "Property") located in Clifton, New Jersey. The purchase price of the Property was $10 million. A portion of the Property was used as landfill for wastes generated by National-Standard's commercial activities on the Property.

The Contract stated Clifton was a wholly-owned subsidiary of Hartz. Contract, art. XXIV. The Contract provided Hartz would pay National-Standard liquidated damages in the amount of $3 million in the event Clifton wilfully defaulted on its obligations under the Contract. Id.

On 11 July 1990, National-Standard filed its complaint (the "Complaint") bringing suit against Defendants. National-Standard brought suit to enforce the Contract on the grounds Defendants repudiated and anticipatorily breached the Contract. National-Standard alleges Defendants expressed an unwillingness to perform under the Contract because Defendants deemed the clean-up of the portion of the Property used as landfill to be unacceptable. Complaint, ¶ 15.

The amended answer and counterclaim (the "Def. Answer") was filed 4 March 1991. Defendants denied National-Standard's allegations and asserted numerous affirmative defenses and counterclaims. Of particular relevance to this opinion are the fourteenth affirmative defense and the fifth counterclaim.

In the fourteenth affirmative defense, Defendants assert the Complaint should be dismissed because National-Standard "failed to meet its statutory obligation under N.J.S.A. 13:1E-116 of disclosing in the Contract the prior utilization of the Property as a sanitary landfill." Def. Answer at 6. In the fifth counterclaim, Defendants seek recision of the Contract in part on the ground "National-Standard knew that the [Property] contained a sanitary landfill but failed to disclose same to [Clifton]. N.J.S.A. 13:1E-116 specifically requires a disclosure of the existence of a sanitary landfill in a contract for the sale of property containing such a landfill." Id. at 14.

National-Standard's answer to amended counterclaims (the "Plntf. Answer") was filed 26 March 1991. National-Standard asserted several affirmative defenses to the counterclaims, including laches, anticipatory breach, waiver, equitable and promissory estoppel and unclean hands. Plntf. Answer at 7.

DISCUSSION

A. Summary Judgment Standard of Review

To prevail on a motion for summary judgment, the moving party must establish "there is no genuine issue as to any material fact and that [it] is entitled to judgment as a matter of law." Fed. R.Civ.P. 56(c). The present task is to determine whether disputed issues of fact exist, but a district court may not resolve factual disputes in a motion for summary judgment. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 249-50, 106 S.Ct. 2505, 2510-11, 91 L.Ed.2d 202 (1986); see Nathanson v. Medical College, 926 F.2d 1368, 1380 (3d Cir. 1991) (Summary judgment may not be granted "if there is a disagreement over what inferences can be reasonably drawn from the facts even if the facts are undisputed."). All evidence submitted must be viewed in a light most favorable to the party opposing the motion. Boyle v. Governor's Veterans Outreach & Assistance Center, 925 F.2d 71, 75 (3d Cir. 1991); Weldon v. Kraft, Inc., 896 F.2d 793, 797 (3d Cir. 1990); see Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587, 106 S.Ct. 1348, 1356, 89 L.Ed.2d 538 (1986); Todaro v. Bowman, 872 F.2d 43, 46 (3d Cir. 1989); Joseph v. Hess Oil, 867 F.2d 179, 182 (3d Cir. 1989). "`Any "unexplained gaps" in material submitted by the moving party, if pertinent to material issues of fact, justify denial of a motion for summary judgment.'" Ingersoll-Rand Fin. Corp. v. Anderson, 921 F.2d 497, 502 (3d Cir. 1990) (quoting O'Donnell v. United States, 891 F.2d 1079, 1082 (3d Cir. 1989)).

Although the summary judgment hurdle is a difficult one to overcome, it is by no means insurmountable. As the Supreme Court has stated, once the party seeking summary judgment has pointed out to the court the absence of a genuine issue of material fact,

  its opponent must do more than simply show that
  there is some metaphysical doubt as to the
  material facts. . . . In the language of the Rule,
  the non-moving party must come forward with
  `specific facts showing that there is a
  genuine issue for trial.' . . . Where the record
  taken as a whole could not lead a rational trier of
  fact to find for the nonmoving party, there is no
  `genuine issue for trial.'

Matsushita, 475 U.S. at 586-87, 106 S.Ct. at 1356 (emphasis in original, citations and footnotes omitted). In other words, the inquiry involves determining "`whether the evidence presents a sufficient disagreement to require submission to a jury or whether it is so one-sided that one party must prevail as a matter of law.'" Brown v. Grabowski, 922 F.2d 1097, 1111 (3d Cir. 1990) (quoting Anderson v. Liberty Lobby, 477 U.S. at 251-52, 106 S.Ct. at 2511-12), cert. denied sub nom., ___ U.S. ___, 111 S.Ct. 2827, 115 L.Ed.2d 997 (1991).

The Supreme Court elaborated on the summary judgment standard in Anderson v. Liberty Lobby: "If the evidence [submitted by a party opposing summary judgment] is merely colorable . . . or is not significantly probative . . . summary judgment may be granted." 477 U.S. at 249-50, 106 S. Ct. at 2511 (citations omitted). The Supreme Court went on to note in Celotex Corp. v. Catrett, 477 U.S. 317, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986): "One of the principal purposes of the summary judgment rule is to isolate and dispose of factually unsupported claims or defenses, and we think it should be interpreted in a way that allows it to accomplish this purpose." Id. at 323-24, 106 S.Ct. at 2553 (footnote omitted).

Once a case has been made in support of summary judgment, the party opposing the motion has the affirmative burden of coming forward with specific facts evidencing a need for trial. see Fed. R.Civ.P. 56(e); see also Maguire v. Hughes Aircraft Corp., 912 F.2d 67, 72 (3d Cir. 1990) (non-moving party may not rest upon mere allegations); Schoch v. First Fidelity Bancorporation, 912 F.2d 654, 657 (3d Cir. 1990) (neither unsupported allegations in pleadings and memoranda of law nor conclusory allegations in affidavits will establish genuine issue of material fact); Hozier v. Midwest Fasteners, Inc., 908 F.2d 1155, 1165 (3d Cir. 1990) (cannot create issue of fact merely by questioning credibility of movant's witnesses; circumstantial evidence may raise issue of fact); Aronow Roofing Co. v. Gilbane Building Co., 902 F.2d 1127, 1128 (3d Cir. 1990) ("summary judgment will be granted where the nonmoving party ...


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