Pursuant to 5TH CIR. R. 47.5, the court has determined that this opinion should not *

be published and is not precedent except under the limited circumstances set forth in 5TH CIR.

R. 47.5.4.

IN THE UNITED STATES COURT OF APPEALS

FOR THE FIFTH CIRCUIT

No. 08-20585

T-M VACUUM PRODUCTS

Plaintiff - Appellee

v.

TAISC, INC

Defendant - Appellant

Appeal from the United States District Court

 for the Southern District of Texas

USDC No. 4:07-CV-04108

Before JONES, Chief Judge, and HIGGINBOTHAM and HAYNES, Circuit

Judges.

PER CURIAM:*

TAISC, a financing company, appeals the trial court’s summary judgment

in favor of T-M Vacuum Products, Inc., a furnace manufacturer. We AFFIRM.

This case arises from a three-party transaction to finance the sale and

lease of two commercial furnaces. T-M agreed to deliver two furnaces to Ulba

Metallurgical Plant Joint Stock Company (not a party to this case) by a date

certain. TAISC functioned as the financing arm by way of a lease transaction.

United States Court of Appeals

Fifth Circuit

F I L E D

July 1, 2009

Charles R. Fulbruge III

Clerk
No. 08-20585

 While this arrangement was nominally structured as a sale and lease of goods, the

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district court analyzed it as a financing transaction, and that is indeed the essence of the

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T-M failed to deliver the furnaces on time. However, Ulba continued to pay

TAISC and ultimately entered into an agreement with T-M, to which TAISC was

not a party, to extend the time for the furnace delivery. That new date was met.

When TAISC refused to pay the remaining amounts due for the furnaces to T-M,

T-M filed this lawsuit. The district court granted summary judgment to T-M for

the remaining balance on the purchase price of the furnaces and refused TAISC’s

claim for return of the payments it had already made (termed “conditional

payments” in the contract) and interest on those payments. TAISC then filed

this appeal.

We review grants of summary judgments de novo. Minter v. Great Am.

Ins. Co. of N.Y., 423 F.3d 460, 464 (5th Cir. 2005). Summary judgment is

appropriate if, after making all inferences in favor of the non-movant, the record

contains no genuine issue of material fact, and the movant is entitled to a

judgment as a matter of law. FED. R. CIV. P. 56(b); Minter, 423 F.3d at 464-65.

TAISC’s arguments on appeal can be summed up as follows: (1) T-M

defaulted by its late delivery of the furnaces and, therefore, forfeited its right to

payment of the purchase price balance; and (2) TAISC is entitled to interest on

the conditional payments it made to T-M for the time period between the original

delivery date and the actual delivery date. Both parties agree that Texas law

applies to our analysis. 

It is unnecessary to decide whether T-M’s original late delivery constitutes

an event of default under the parties’ contract, because we conclude that

TAISC’s continued acceptance of performance under the financing contract

prevented TAISC from using the default as an excuse for its own

nonperformance. See Gupta v. E. Idaho Tumor Inst., Inc., 140 S.W.3d 747, 756

(Tex. App. -- Houston [14th Dist.] 2004, pet. denied). As the district court 1
No. 08-20585

agreement between TAISC, T-M, and Ulba. Thus, like the parties and the district court, we

analyze it as such.

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correctly explained, T-M’s delay did not excuse TAISC’s performance because

TAISC continued to pay T-M and accept lease payments from Ulba. Texas law

is clear that, “[i]f the non-breaching party elects to treat the contract as

continuing and insists the party in default continue performance, the previous

breach constitutes no excuse for nonperformance on the part of the party not in

default and the contract continues in force for the benefit of both parties.” Id.

Despite its demand letter, TAISC’s actions did not treat T-M as being in

default after the original failure to timely deliver. T-M’s delay in delivery

provided TAISC or Ulba with the opportunity to cancel the contracts by their

own terms. Both declined to do so, instead treating T-M’s obligations to deliver

the furnaces as continuing. TAISC continued to make payments to T-M for

nearly four months after notifying T-M of its “defaults,” T-M manufactured and

delivered the furnaces, Ulba accepted them, and Ulba made the lease payments

to TAISC. After electing to continue contract performance, TAISC cannot now

rely on T-M’s initial delay as an excuse for the failure to make full payment. For

the same reason, we also agree with the district court’s decision regarding

interest on the conditional payments. TAISC also has failed to establish that it

was damaged by any delay. 

Accordingly, the district court’s judgment is AFFIRMED.