Court Opinion

ID: 800050
Source: CourtListenerOpinion
Date Created: 2012-05-17 17:24:06+00
Date Added: 2024-06-11T17:59:53.016719
License: Public Domain

Case: 11-60692     Document: 00511858847         Page: 1     Date Filed: 05/17/2012

            IN THE UNITED STATES COURT OF APPEALS
                     FOR THE FIFTH CIRCUIT  United States Court of Appeals
                                                     Fifth Circuit

                                                                            FILED
                                                                           May 17, 2012

                                     No. 11-60692                          Lyle W. Cayce
                                   Summary Calendar                             Clerk

DE LAGE LANDEN FINANCIAL SERVICES, INCORPORATED,

                                                  Plaintiff - Appellee
v.

ERIC DAHLHAUSER,

                                                  Defendant - Appellant

                   Appeal from the United States District Court
                     for the Southern District of Mississippi
                              USDC No. 1:10-cv-567

Before REAVLEY, SMITH, and PRADO, Circuit Judges.
PER CURIAM:*
        Defendant-Appellant Eric Dahlhauser appeals a summary judgment in
favor of Plaintiff-Appellee De Lage Landen Financial Services, Inc. (“DLL”), for
the amount due on a lease agreement for which Dahlhauser executed a
guaranty. We AFFIRM.
        DLL leased medical radiotherapy equipment to defendant Cedar Lake
Oncology, LLC, under their “Master Lease Agreement” and “Master Lease

        *
         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 R. 47.5, the court has determined that this opinion should not
be published and is not precedent except under the limited circumstances set forth in 5TH CIR.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.
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                                 No. 11-60692

Schedules” (collectively, the “Lease Agreement”). Dahlhauser and two other
defendants, Laurence Lines and Biloxi Radiation Oncology Center, LLC, each
executed a guaranty of Cedar Lake’s obligations under the Lease Agreement.
      Cedar Lake defaulted on rental payments due under the Lease Agreement.
DLL accelerated the future rental payments due and brought this suit for the
unpaid balance against Cedar Lake, Biloxi, Lines, and Dahlhauser.         Cedar
Lake, Lines, and Biloxi agreed to a consent decree. The decree allowed Cedar
Lake to retain possession of the equipment and required Cedar Lake, Lines, and
Biloxi to adhere to a schedule of payments, to provide DLL with additional
security, and to take other measures to ensure that DLL would be paid.
Dahlhauser was not a party to the consent decree.
      Cedar Lake, Lines, and Biloxi failed to make the payments required by the
consent decree. On DLL’s motion, the district court entered judgment against
those defendants for the unpaid balance of the amount due under the Lease
Agreement.    DLL also moved for summary judgment against Dahlhauser,
contending that his guaranty makes him jointly and severally liable with the
other defendants. The district court granted the motion and entered judgment
against Dahlhauser. We review a grant of summary judgment de no novo,
affirming the judgment “if we find that no genuine issue of material fact
remained for trial and that judgment was proper as a matter of law.” Stewart
v. Miss. Transp. Com’n, 586 F.3d 321, 327 (5th Cir. 2009) (internal quotation
marks and citation omitted).
      Dahlhauser raises three issues on appeal. First, he contends that there
is a genuine issue of material fact as to the amount of damages. Dahlhauser
points to evidence that DLL has collected payments from other defendants that
are not reflected in the amount stated in the judgment. This is not material. As
the district court explained, “[a]ny payments that have been or will be made by
other parties will reduce the amount owed by Dahlhauser, since the Guaranty

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                                      No. 11-60692
provides that he and the other Guarantors are jointly and severally liable for the
amounts due . . . .” Dahlhauser also argues that the value of the leased
equipment should be deducted from DLL’s recovery. Dahlhauser did not raise
this argument below. “[A]rguments not raised before the district court are
waived and cannot be raised for the first time on appeal.” Matco Ltd. P’ship v.
Wellons, Inc., 588 F.3d 864, 877 (5th Cir. 2009). Moreover, the Lease Agreement
permits DLL to choose between taking possession of the leased equipment or
accelerating the rental payments and recovering the unpaid balance.
      Second, Dahlhauser argues that the consent decree was a novation,
displacing Cedar Lake’s obligations under the Lease Agreement and thereby
extinguishing Dahlhauser’s obligations under the guaranty. Novation occurs
only if “the parties intended to discharge the earlier contract.” Buttonwood
Farms, Inc. v. Carson, 478 A.2d 484, 486 (Pa. Super. 1984).1 The district court
found that the consent decree did not discharge the Lease Agreement, and we
agree. The decree states that the defendants party to it “acknowledge and
reaffirm” their obligations under the Lease Agreement. Also, Dahlhauser’s
guaranty permits DLL to enforce its terms notwithstanding any waiver or
compromise DLL might make in its efforts to recover from Cedar Lake.
      Third, Dahlhauser argues that the district court abused its discretion in
refusing to allow Dahlhauser to conduct additional discovery before considering
DLL’s summary judgment motion. See FED. R. CIV. P. 56(d). A litigant seeking
to delay consideration of a summary judgment motion in order to allow
additional discovery must show that he has pursued discovery diligently thus
far. Beattie v. Madison Cnty. Sch. Dist., 254 F.3d 595, 606 (5th Cir. 2001). In
this case, the district court observed that Dahlhauser elected to minimize
litigation expenses by not conducting any discovery prior to the lapse of the

      1
          The parties agree that Pennsylvania law governs their contractual arrangements.

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deadline. Ongoing settlement negotiations do not excuse suspending discovery
efforts. Beattie, 254 F.3d at 606.
      Dahlhauser would also have to show “(1) why []he needs additional
discovery and (2) how that discovery will create a genuine issue of material fact.”
Id. Dahlhauser seeks discovery regarding the amount DLL has recovered from
other defendants, as well as “the specific value of the leased equipment” and “the
value of any other available assets that DLL refuses to utilize.” As noted above,
the amount DLL has recovered in payments from other defendants or through
taking assets they provided as security is immaterial because they and
Dahlhauser are jointly and severally liable, and the issue of mitigation through
repossession of the equipment is raised for the first time on appeal.
      Dahlhauser also argues that he should have been allowed additional
discovery to “better demonstrate that the process by which he was induced to
sign the guaranty was procedurally unfair, thereby allowing him to show that
the agreement was unconscionable.” As the district court observed in rejecting
the unconscionability argument below, the circumstances in which Dahlhauser
executed the guaranty are within his personal knowledge.            The affidavit
testimony Dahlhauser offered regarding those circumstances is largely
conclusory. The remainder, if true, would nevertheless fail to establish that
Dahlhauser lacked a meaningful choice in executing the guaranty. See Sally v.
Option One Mortg. Corp., 925 A.2d 115, 119 (Pa. 2007) (contract unconscionable
when, inter alia, “there was a lack of meaningful choice” in its acceptance).
      The district court’s judgment is AFFIRMED.

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