Court Opinion

ID: 58326
Source: CourtListenerOpinion
Date Created: 2010-04-26 02:34:44+00
Date Added: 2024-06-11T17:19:43.581917
License: Public Domain

[DO NOT PUBLISH]

             IN THE UNITED STATES COURT OF APPEALS

                       FOR THE ELEVENTH CIRCUIT
                                                                             FILED
                       ------------------------------------------- U.S. COURT OF APPEALS
                                                                     ELEVENTH CIRCUIT
                                    No. 07-11292                        January 25, 2008
                              Non-Argument Calendar                   THOMAS K. KAHN
                      --------------------------------------------          CLERK

                       D.C. Docket No. 05-00148-CV-1

SOUTH CENTRAL STEEL, INC.,

                                                       Plaintiff-Appellant,

                                        versus

TRAVELERS CASUALTY AND SURETY COMPANY OF AMERICA,
MCKNIGHT CONSTRUCTION CO., INC.,
a Georgia Corporation,

                                                       Defendants-Appellees.

            ----------------------------------------------------------------
                 Appeal from the United States District Court
                      for the Southern District of Georgia
            ----------------------------------------------------------------
                                (January 25, 2008)

Before EDMONDSON, Chief Judge, BIRCH and PRYOR, Circuit Judges.

PER CURIAM:
             Plaintiff-Appellant South Central Steel, Inc. (“South Central”) appeals the

grant of summary judgment in favor of Defendant-Appellee McKnight

Construction Co. (“McKnight Construction”) in South Central’s suit for breach of

contract.1 No reversible error has been shown; we affirm.

             The facts are set out fully in the district court’s comprehensive opinion.

Stated briefly, on 14 April 2004, McKnight Construction contracted with the State

of Georgia to perform construction work at the Henderson Library at Georgia

Southern University in Statesboro, Georgia (the “Library Project”). McKnight

Construction subcontracted steel erection and fabrication work to Houston Steel

Fabricators/Erectors (“Houston Steel”). In January 2005, when Houston Steel

encountered financial problems and could purchase no steel on its own account,

Houston Steel contacted South Central to supply steel for the Library Project.

South Central supplied steel worth $51,609.80 to Houston Steel -- knowing of

Houston Steel’s financial difficulties -- and now seeks to recover that amount, plus

other damages, from McKnight Construction.2

             South Central bases its contention that McKnight Construction is

responsible for the costs of the steel on a series of communications between Roger

  1
   South Central also sued Travelers Casualty and Surety Company of America, McKnight’s surety
on the project at issue.
      2
          In its complaint, South Central sought damages of $125,000.

                                                    2
Ricks, President of South Central, and William McKnight, president of McKnight

Construction. Ricks testified by deposition that, as a result of Houston Steel’s

financial problems, South Central would supply the steel for the Library Project

only if it could deal with the general contractor, McKnight Construction.

Notwithstanding its desire to deal directly with McKnight Construction, on 13

January 2005, South Central had a first shipment of steel delivered to Houston

Steel for the Library Project; Houston Steel paid South Central for that shipment.

When Houston Steel sought additional supplies, South Central was unwilling to

supply the steel; but Ricks reiterated South Central’s willingness to contract

directly with McKnight Construction.

         At some point after 13 January 2005, according to Ricks, Ricks told

McKnight that South Central would provide the steel to the Library Project if

South Central received a purchase order from McKnight Construction; McKnight

said he would send the purchase order. On 27 January 2005 -- although no

purchase order had been received -- South Central ordered $6,619.80 of steel from

one of South Central’s suppliers to be delivered to Houston Steel. That steel was

shipped to Houston Steel; South Central claims that it has not been paid for that

steel.

                                          3
      On 2 February 2005, South Central sent McKnight Construction a “material

purchase agreement” pursuant to which South Central would supply steel to the

Library Project to be paid for by McKnight Construction. That this “ material

purchase agreement” was never signed by McKnight Construction is undisputed.

      On 7 February 2005, McKnight Construction faxed and mailed a transmittal

letter with an attached purchase order for $292,667 of steel to South Central (the

“Purchase Order”). The transmittal letter -- signed by McKnight -- stated:

“PLEASE SIGN ALL THREE COPIES AND RETURN. UPON RECEIPT, WE

WILL SIGN AND FORWARD YOU ONE EXECUTED COPY.”

      Ricks concedes that he did not sign and return the Purchase Order when he

received the 7 February fax. Instead, upon receipt, Ricks faxed a counter-proposal

seeking changes in the Purchase Order: South Central objected to terms that

would have made South Central responsible for failure due to fabrication and

proposed a new letter agreement with terms limiting South Central’s

responsibilities. The counter-offer concluded as follows: “We ask that you

acknowledge receipt of this letter and acceptance of the terms written within by

simply signing and returning a copy via fax.” McKnight Construction did not

accept the proposed counter-offer.

                                         4
       Although McKnight Construction had not agreed to South Central’s

counter-offer, on 10 February 2005, South Central ordered $44,990 of additional

steel for the Library Project; that steel was picked up by Houston Steel. South

Central claims to have received no payment for that steel.

       At some point -- the record is unclear exactly when -- South Central

received the mailed copy of the Purchase Order (the one that had been faxed

earlier). Ricks claims to have signed that copy upon receipt and to have returned it

to McKnight Construction, even though the counter-offer had been sent earlier.3

The only copy of a Purchase Order presented in response to the motion for

summary judgment was unsigned on behalf of McKnight Construction. By letter

dated 21 February 2005, McKnight Construction notified both Houston Steel and

South Central that it would procure steel for the Library Project elsewhere because

Houston Steel was not AISC certified as required for the Library Project. South

Central responded that their right to payment from McKnight was not contingent

on Houston Steel being AISC certified. This litigation ensured.

  3
    McKnight disclaims receipt of the mailed copy of the Purchase Order signed by South Central
until after litigation began. At the summary judgment stage of proceedings, we “must draw all
reasonable inferences in favor of the nonmoving party,” and we “may not make credibility
determinations or weigh the evidence.” Reeves v. Sanderson Plumbing Prods., Inc., 120 S.Ct. 2097,
2110 (2000).

                                               5
      Under Georgia law -- no dispute exists that Georgia law applies -- a contract

requires an agreement of the parties. Unless and until a meeting of the minds is

reached on all essential terms, a contract is incomplete and unenforceable. See,

e.g., Frickey v. Jones, 630 S.E.2d 374 (Ga. 2006) (no enforceable settlement

agreement reached because insurer’s response to settlement offer conditioned

acceptance on claimant’s agreement with additional term); Cox Broadcasting

Corp. v. National Collegiate Athletic Assoc., 297 S.E.2d 733, 737-38 (Ga. 1982)

(no enforceable contract because parties agreed to contract language but disagreed

from time of purported contract formation to meaning of that language); O.C.G.A.

13-3-2 (“The consent of the parties being essential to a contract, until each has

assented to all the terms, there is no binding contract....”). Agreement is also the

lynchpin for a contract for sale of goods under Georgia’s version of the Uniform

Commercial Code (“UCC”): “A contract for sale of goods may be made in any

manner sufficient to show agreement....” O.C.G.A. 11-2-204.

      The district court concluded -- and we agree -- that the record evidence

disclosed no material fact in dispute: no reasonable jury could find that McKnight

Construction and South Central agreed to terms of a steel supply contract for the

Library Project. Even accepting all reasonable inferences in favor of South

Central, the express terms of the Purchase Order required specifically that it be

                                          6
returned to McKnight Construction for execution by McKnight Construction; the

record evidence for summary judgment purposes requires us to accept that South

Central returned an executed Purchase Order to McKnight Construction but

supports no inference that McKnight Construction signed the Purchase Order.

And while the record is unclear about when South Central signed the Purchase

Order, that it was after South Central rejected the terms of the Purchase Order and

submitted a counter-offer to McKnight Construction is clear. South Central can

not have it both ways: it cannot first send a counter-offer and then -- without

agreement by McKnight Construction -- later accept the original offer. The

counter offer operated as a rejection of the Purchase Order. See Frickey, 630

S.E.2d at 376-77; Calhoun v. Cullum’s Lumber Mill, Inc., 545 S.E.2d 41, 45 (Ga.

App. 2001).

      South Central argued before the district court that its counter offer

constituted an acceptance of the Purchase Order under Section 2-207 of the UCC,

O.C.G.A. § 11-2-2-207, which uses these words:

              A definite and seasonable expression of acceptance or a
              written confirmation which is sent within a reasonable
              time operates as an acceptance even though it states
              terms additional to or different from those offered or
              agreed upon, unless acceptance is expressly made
              conditional on assent to the additional different terms.

                                          7
South Central seems to have abandoned that argument on appeal. In addition, the

counter-offer was no “definite...expression of acceptance or a written

confirmation.” And, the counter-offer expressly requested McKnight

Construction’s assent to the modification. Section 2-207 does not assist South

Central. In this case, when McKnight Construction received the counter proposal,

it reasonably could assume that (i) South Central had rejected the terms of the

Purchase Order, (ii)negotiations were continuing, and (iii) no contract had been

formed. See Duval & Co. v. Malcom, 214 S.E.2d 356 (1975) (“meeting of the

minds” is a condition precedent to application of section 2-207).

        The summary judgment record fails to present a material issue on the

existence of an enforceable contract between South Central and McKnight

Construction. When South Central ordered additional steel for Houston Steel on

10 February 2005 -- after rejecting the Purchase Order terms and knowing of

Houston Steel’s financial difficulties -- it assumed the risk that Houston Steel

count not make payment.4

       AFFIRMED.5

   4
   South Central makes no argument on appeal -- and we do not consider -- whether these facts
would support a non-contract based remedy.
  5
    The district court also concluded that South Central’s claim is defeated by the statute of frauds.
Because we conclude that South Central failed to proffer sufficient evidence to place the existence
of an enforceable contract in dispute, we do not reach this issue.

                                                  8