F ILED U.S. COURT O F APP EALS EL EV EN TH C IRC UIT Sep tember 1 2, 2008 T HOMA S K. KA HN CLERK [DO NOT PUBLISH]
IN THE UN ITED STATES COURT OF APPEALS FO R T HE EL EV EN TH CIRC UI T

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N o. 08- 1023 0 Non-A rgum ent Calendar

--- --- --- --- --- --- --- --- --- --- --- --- --- --- -- D. C. Docket N os. 07-0039 9-CV -V EH & 05-04637 -BK -T BB In Re: HUNJAN MOULDED PRODUCTS (ALABAMA) LTD., INC., D e b t o r ,

____ ____ ____ ____ ____ ____ ____ ____ ____ ____ ____ ____ ____ ____ ____ ____ __ EN-PLAS, INC., Pl ai nt iff -Ap pe ll an t,
ve rs us HUNJAN MOULDED PRODUCTS (ALABAMA), LTD., AMS OU TH BA

NK (Re gion s), D ef en dants -Appe lle es .

- - - - - - - - - - - - --- --- --- --- --- -- --- --- - --- --- -- --- --- --- --- --- --- -- Appeal f rom the United State s District Court for the N orthern District of Alabam a

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(S ep te m be r 12, 200 8) Be fo re E D MO N D SO N , Ch ie f Judg e, MA RC U S an d P RY O R, Ci rc uit Jud ge s. PE R C U RI A M:Reg ions is the successor by merg er to the i ntere sts of AmSouth Bank, the party in the bankruptc y 1 court proc eeding
. Hunja n, a De la wa re c or po ratio n w itha

manu fa c tur ingfa c ili ty

in A la bama , p ro du c e d p la sti c 2 injection molded parts chie fl y fo r t h e automotive industry . Hunjan is one of se vera l subsidiaries owne d b y Hunja n Inte rn atio na l. 2 En-P las, I nc. a

ppeals the dist rict court’ s affir m ance of the bankruptcy
co urt’ s de ci sio n inf

av or of H unj anMo uld ed

P ro duc ts L td. , I nc . ( “ H unj an ”) on E nPl as ’ s c ount er cl ai m

a nd i n f av or of Re gio ns B an k ( “ Re gio ns” ) on i ts c ro ss- cl ai m 1 ag ai ns t En -Pl as . No rev ers ib le erro r ha s b een sh own ; we af fir m . Hunj an filed for C hapter 11 bankrup tcy . The bankrupt cy court approved 2 the sa le of

m ost of H unj an ’ s a sse ts, inc lud ing c er ta in p la sti c inj ec tio n m old ing
m achines and related equipm ent (the “ subject e quip m ent”). E n-Plas, the suppl ier of the subject e quip m ent, had obj ected to its sale, a sserting that En-Plas never had sol d th e equip m en t t o H unj ana nd tha t E n- Pl as sti ll owned it
. A ft er the c ourt a

ppr ove d th e sa le , H unj anini tiate d an a dve rs ar y pr oc ee din g to d et er m ine the na tur e, e xte nt, va lid ity a nd p ri or ity

of int er es ts o f cl ai m an ts t o th e
sa le pr oc ee ds. E n- Pl as f

ile d apr oof

of c la im on the sub

j ec t e qui pm en t and a lso
co unt er cl ai m ed , a sse rt ing it s r igh t t o th e sa le pr oc ee ds o f the e qui pm en t be ca use the tr an sa ct ion s be tw ee n it a nd H unj anc onst itu te d ba ilm en ts, not sa le s. R eg ion s, H unj an ’ s m ai n pr e- pe tit ionse cure d le nde r, a lso f ile d apr oof

of c la im a nd c ro sscl ai m ed a ga ins t E n- Pl as , c ont en din g th at E n- Pl as sol d th e equip m en t t o H unj an ,3

that En-P las’ s security

interest w as not perfected and, theref ore, that Regions had th e su pe rio r cl ai m

to th e p ro ceed s. At a bench trial, En-P las em

ploy ees and form er H unjan em ploy ees testified that the true understandin g of the transactions between the com panies was that of a ba ilm en t, not

asa le
. T he bankr

upt cy c ourt c onc lud ed

that, ba se d onthe quo ta tio ns and purchase orders exchanged betwee n En-P las and Hunj an, a valid sales contract
ex ist ed be tw ee n th e tw o. B ec au se the te sti m ony about apr ior ba ilm en t a gr ee m en t contradicted the agreed-upon term s in the writings, the bankruptcy court de te rm in edth atth e p aro l ev id en ce ru le ba rred it s u se in co ns tru in g t he co nt ract . The bankruptcy

court did use the parol evidence rule to allow evidence of a
co ndi tio n su

bse que nt b ec au se the c ondi tio n di d no t c ontra dic t the te rm s of the
w ri tin gs. T he bankr

upt cy c ourt di d no t f

ind c re dib le the te sti m ony

that the tr an sa ct ion s w er e ba ilm en ts. T he bankr upt cy c ourt de ci de d a ga ins t E n- Pl as on i ts
co unt er cl ai m

a nd i n f av or of Re gio ns o n it s c ro ss- cl ai m . E n- Pl as appe al ed to the di st ric t co ur t; an d t he di st ric t co ur t af fir m ed
. On appeal, En- Plas contends that th e ar rangem ent betwee n it and Hunjan
co nst itu te d aba ilm en t, not asa le ; so Re gio ns’ se curi ty int er es t di d no t c ove r the subj ec t e qui pm en t. E n- Pl as a lso a rg ue s th at the bankr

upt cy c ourt e rr ed

in ap ply ing the paro l e vid en ce r ule be ca use the doc um en ts e xc hange d be tw ee n th eIn an appea l from the district cour t’s aff irmance of the ba

nkruptcy court’s or der, w e re view the 3 bankruptc y court’s de cision. Educ. Credit Mg mt. Corp. v. Mosley , 494 F.3d 1320, 1324 ( 11th Cir. 2007). 4 parties we re not intended to be a f inal expression of their agre em ent, the essential te rm s of the a gr ee m en t w er e undi sput ed , a nd n o party obj ec te d to the a dm iss ionof pa ro l ev id en ce. W e re vie wthe bankr

upt cy c ourt’ s f ac t de te rm ina tio ns f

or c le ar e rr or a nd i ts le ga l c onc lus ion s de nov o. H em ar I ns. Co rp . of

A m . v. Co x, 338 F
. 3d 1 238, 124 1 (11th Cir. 2003); see also Chalik v. Mooref ield, 748 F.2d 616, 619 (11th Cir. 1984 ) (a ppellate court m

ust accept the fac tual finding s of the bankruptcy court unless clearly

err oneous , par

ticularly when f indin gs are af

firm ed by district court). 3 No clear er

ror has been shown in the bankruptcycourt’ s determ ination that the tr an sa ct ion s be tw ee n E n- Pl as a nd H unj anc onst itu te d sa le s. Q uot at ion s and purchase orders exchanged betwe en the parties about the sub j ect equipm ent listed the e qui pm en t t o be sol d, the f ull pur ch as e pr ic e of

the e qui pm en t, a nd p ay

m en t te rm s a s 10 pe rc en t do w n, 90 p er ce nt w ith in 3 65 d ay s of c om m iss ion ing of

the equipm ent. T he quotatio n contained a war ranty provisio n and also ind icated that the risk of loss was on Hunj an upon shipm ent even if the full purchase price wa s not y et pa id. T he pur ch as e or de rs a nd i nvoi ce s w er e co nsi ste nt w iththe seEn-Plas asser ts that, if a sale did oc cur, it wa s a sale on approva l a nd Hunjan neve r ac cepte d the 4 machines. We re

ject this argument; as noted, we see no e rror in t h e bankruptcy

court’s deter mination that an unconditional sale oc curr ed. 5 quot at ion s. T he se doc um en ts e vid en ce nothin g othe r than an un co ndi tio na l c re dit sale. 4 W e al so c onc lud e tha t the bankr upt cy c ourt c or re ct ly appl ie d th e paro l evidence rule. A t trial, En-P las contended th e understanding betwee n the parties
w as that the 10 p er ce nt d ow n inthe quo ta tio n a ppl ie d to shi ppi ng c ost s, that E nPl as r et ai ne d ti tle to the e qui pm en t, a nd tha t no bin din g c ontra ct a ro se unt il H unj ana rr an ge d f

inanc ing f

or the sub j ec t e qui pm en t or

w as a w ar de d apr oduc tio n contract. U nder Ala

bam a’ s version of the Uniform Com m ercia l Code, [t ] er m s w ithr es pe ct

to w hic h th e co nf

irm at or y m em or an daof

the part ie s a gr ee or

w hic h are oth er

w ise se t f orth i n aw ri tin g in te nde d by the part ie s a s af

ina l e xpr es sio n of

the ir a gr ee m en t w ithr es pe ct

to suc h te rm s a s are inc lud ed the re in m ay

not be c ontra dic te d by evidence of any

prior agree m ent or of a c ontem poraneous oral ag reem en t. . . A la
. Co de § 7- 2- 202. B ec au se the quo ta tio ns and p ur ch as e or de rs w er e co nsi ste nt in the ir te rm s, paro l e vid en ce barr ed c ontra dic tor

y e vid en ce . About

the te sti m ony that Hunj an obtain financing or a production contract before a bindi ng contract
w ithE n- Pl as a ro se , the bankr upt cy c ourt c onstru ed

thi s a s ac ondi tio n su

bse que nt tha t po te nti al ly

c oul d have dis ch ar ge d H unj anof it s du ty to pay the f ull pur ch as eEn-Plas faults the ba nkruptcy court for deter mining that the writing s were intended by the par ties 5 to refle ct their fina l ag ree ment; but the parol evide nce r ule applies to “[t] erms with re spect to which the conf irmatory memoranda

of the pa

rties agree or whi ch ar e o t h erwise set forth in a writing int e nd e d b y the pa

rt ie s a s a fi na l e xpre ssi on

of the ir a g re e me nt. ” Al a . Co de § 7 -2 -2 02 (e mph a sis added)
. As noted, the quotations a nd purcha se order s ag ree d on the terms, and the bankruptc y court was c orre ct in applying the rule for that rea son.

6 pr ic e. W e se e no e rr or

in thi s de te rm ina tio n. S ee A la
. Co de § 7- 2- 202( b) ( the ag re ed -u pon te rm s of

ac ontra ct

c anbe e xpl ai ne d or

sup ple m en te d by

c onsi ste nt additio nal term s). 5 In addition to barring the testim ony under the parol evidence rule, the court did not c re dit the te sti m ony

that the tr an sa ct ion s w er e ba ilm en ts. A s no te d by the bankr upt cy c ourt, se ve ra l f

ac ts a bout the tr an sa ct ion s w er e inc onsi ste nt w itha b ai l m en t , i n cl u d i n g t h e w arra n t y p ro v i s i o n i n t h e q u o t at i o n an dEn -P l as ’s accounting records, w hich did not record the 10 percent down-pay m ent as shi ppi ng c ost s bu t, ins te ad , a s ade posi t. A nd E n- Pl as ’ s c hara ct er iz at ionof the tr an sa ct ion s e vol ve d th ro ugho ut the bankr upt cy pr oc ee din gs; a t vari ous tim es , E nPl as r ef er re d to the tr an sa ct ion s a s ale as e w itha n op tio n to pur ch as e, ause ag re em en t, a nd a

ba ilm en t. N one of

the se te rm s w er e re fl ec te d inthe w ri tin gs
ex ch an ge d be tw ee n th e part ie s be fo re bankr upt cy pr oc ee din gs b eg an . T hus, the bankr upt cy c ourt c or re ct ly c onc lud ed

that t o c re dit

te sti m ony

about ba ilm en t
w oul d r equir e it to i gnor e the w ri tin gs e xc hange d be tw ee n th e part ie s. W e w ill not dis tur b th e bankr

upt cy c ourt’ s c re dib ili ty

de te rm ina tio ns. S ee I n r e E ngl an de r, 95Th e dis tr ic t c ourt a lso c or re c tly c on c lud e d th at, b e c a

us e the tr ans a c tio ns we re sa le s, Re g ion s’ 6 proper ly perf ecte d secur ity

intere s t att ache d -- via a n afte r-a cquire d proper

ty clause -- to the pr oc e e ds of

the su bje c t e qu ipm e nt. 7 F. 3d 1 028, 103 0 ( 11th C ir
. 199 6) ( the r ev ie w ing c ourt m ust giv e due r eg ar d to the bankrupt cy

court’ s oppo rtunity

to judge the cr edibilit y

of the w itnesses); In re Su ble tt, 895 F
. 2d 1 381, 138 4 ( 11th C ir
. 199 0) ( bankr upt cy c ourt’ s c onsi de ratio n of extrinsic evidence to determ ine parties’ intentio ns about a contrac t are subject onlyto clearly

err oneous review ). 6 AFFIR MED.