Court Opinion

ID: 815659
Source: CourtListenerOpinion
Date Created: 2013-01-18 20:47:29+00
Date Added: 2024-06-11T13:09:25.846088
License: Public Domain

UNPUBLISHED

                  UNITED STATES COURT OF APPEALS
                      FOR THE FOURTH CIRCUIT

                             No. 12-1932

METROPOLITAN GROUP, INC.,

                Plaintiff - Appellant,

          v.

MERIDIAN INDUSTRIES, INC.,

                Defendant - Appellee.

Appeal from the United States District Court for the Western
District of North Carolina, at Charlotte. Max O. Cogburn, Jr.,
District Judge. (3:09-cv-00440-MOC-DSC)

Submitted:   January 14, 2013              Decided:   January 18, 2013

Before KEENAN, WYNN, and THACKER, Circuit Judges.

Affirmed by unpublished per curiam opinion.

Kenneth R. Raynor, TEMPLETON & RAYNOR, Charlotte, North
Carolina, for Appellant. Kenneth D. Bell, Matthew J. Hoefling,
Elizabeth Timmermans, McGUIRE WOODS, LLP, Charlotte, North
Carolina, for Appellee.

Unpublished opinions are not binding precedent in this circuit.
PER CURIAM:

             After Meridian Industries, Inc. (“Meridian”) sold its

shuttered     Belmont,     North    Carolina       yarn-dyeing          facility        (the

“Property”)      to     Metropolitan       Group,        Inc.     (“Metropolitan”),

problems    arose.       Eventually,      Metropolitan          sued    Meridian        for,

among other claims, breaching the relevant Purchase Agreement

because Meridian purportedly had “actual knowledge” that certain

hazardous     materials     remained       on     the    Property       when       it   was

conveyed.     Meridian filed a counterclaim for breach of contract,

contending     that     Metropolitan           destroyed    certain           groundwater

monitoring wells and thereby failed to keep its obligation under

the   Purchase      Agreement      to    reasonably        facilitate         Meridian’s

access to the groundwater on the Property.                      The district court

entered summary judgment in favor of Meridian on both claims, *

and Metropolitan appealed.              We have reviewed the record, and we

affirm.

             Metropolitan    raises        two    main     arguments          on   appeal.

First, it contends that the district court erred in entering

summary judgment against its contract claim because a jury could

conclude     that     Meridian   had      actual    knowledge          that    hazardous

      *
       Summary judgment was entered in favor of Metropolitan on
its contract claim to the extent that it alleged an asbestos-
related breach and damages.      That portion of the district
court’s judgment has not been appealed.

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materials remained on the Property at the time of the Purchase

Agreement.

           We review a grant of summary judgment de novo, drawing

reasonable      inferences     in   the       light    most    favorable    to   the

nonmoving party.        Webster v. U.S. Dep’t of Agric., 685 F.3d 411,

421 (4th Cir. 2012); United States v. Bergbauer, 602 F.3d 569,

574 (4th Cir. 2010).           To withstand a summary judgment motion,

the nonmoving party must produce competent evidence sufficient

to reveal the existence of a genuine issue of material fact for

trial.    See Fed. R. Civ. P. 56(c)(1); Thompson v. Potomac Elec.

Power    Co.,    312 F.3d 645,   649       (4th    Cir.    2002).       Neither

conclusory      allegations,        unwarranted         inferences,        nor   the

production of a “mere scintilla of evidence” in support of a

nonmovant’s      case    suffices     to       forestall       summary     judgment.

Thompson, 312 F.3d at 649 (internal quotation marks omitted);

see Beale v. Hardy, 769 F.2d 213, 214 (4th Cir. 1985).                      Instead,

this Court will uphold the district court’s grant of summary

judgment unless it finds that a reasonable jury could return a

verdict for the nonmoving party on the evidence presented.                       See

EEOC v. Cent. Wholesalers, Inc., 573 F.3d 167, 174-75 (4th Cir.

2009).

           When resolving a dispute over the proper construction

of a contract governed by North Carolina law, a court’s “primary

purpose” is to “ascertain and give effect to the intention of

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the    parties.”        Schenkel      &    Shultz,       Inc.    v.   Hermon     F.    Fox    &

Assocs., P.C., 658 S.E.2d 918, 921 (N.C. 2008); see Woods v.

Nationwide Mut. Ins. Co., 246 S.E.2d 773, 777 (N.C. 1978).                                 When

the contractual terms are unambiguous, the parties’ intent as to

their meaning is self-evident.                       Harleysville Mut. Ins. Co. v.

Buzz Off Insect Shield, L.L.C., 692 S.E.2d 605, 612 (N.C. 2010).

And when the contract defines a term, the court must ascribe

that meaning to the term in order to effect the intent of the

parties.       Id.; Woods, 246 S.E.2d at 777.                   By contrast, when the

contractual language is “fairly and reasonably susceptible to

either    of    the    constructions           for     which    the   parties    contend,”

Harleysville,         692    S.E.2d       at     612     (internal     quotation           marks

omitted),       it    is    ambiguous          and     the   “interpretation          of    the

contract is for the jury.”                     Schenkel & Shultz, 658 S.E.2d at

921.

               Here, Metropolitan argues that Meridian breached the

Purchase Agreement because its employees had “actual knowledge”

that hazardous materials remained on the Property at the time

the agreement was signed.                 But Metropolitan’s arguments are not

supported by the plain language of the Purchase Agreement, which

defines    “actual         knowledge”      as    “the    current,      actual    conscious

knowledge”      of    employees    of      Meridian.           None   of   the   pertinent

deposition testimony indicates that any Meridian employee had

actual knowledge that any hazardous materials were on site at

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the    time    the    Purchase      Agreement        was       signed.           Even       assuming

without       deciding      that    the     record        demonstrates            a     degree    of

negligence,       Metropolitan’s           claims       must        fail.         The       Purchase

Agreement      did    not    warrant       against      Meridian’s           negligence;          the

Agreement warranted           only       against    Meridian’s          actual          knowledge.

Because       Metropolitan         can     point     to     nothing          in       the     record

demonstrating        anything       more    than    —     at    worst       —    negligence        or

ignorance on the part of Meridian’s employees rather than actual

knowledge, the district court properly entered summary judgment

on this claim.

               Second, Metropolitan contends that the district court

erroneously      entered       summary      judgment           in    favor       of     Meridian’s

contract counterclaim because, in Metropolitan’s view, a jury

could    conclude      that       the    Purchase       Agreement       did       not       obligate

Metropolitan to provide Meridian with access to anything other

than    the    Property      at    large,    not     to    the       specific         groundwater

monitoring       wells      that    were     destroyed.               Our       review       of   the

Purchase Agreement convinces us that Metropolitan’s focus on the

pertinent phrase, removed from its surrounding context, flouts

the principle that contracts must be construed “as a whole,”

considering          each     provision       “in         relation          to        all     other

provisions.”          Schenkel & Shultz, 658 S.E.2d at 921 (internal

quotation marks omitted); see also State v. Philip Morris USA

Inc., 685 S.E.2d 85, 90 (N.C. 2009); Woods, 246 S.E.2d at 777;

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Lane v. Scarborough, 200 S.E.2d 622, 625 (N.C. 1973).                            Moreover,

“contracts      are   to   be       construed      consistently         with   reason   and

common sense.”          Variety Wholesalers, Inc. v. Salem Logistics

Traffic Servs., LLC, 723 S.E.2d 744, 748 (N.C. 2012) (internal

quotation marks omitted).

            In    our    view,       the    district      court   properly        concluded

that the Purchase Agreement committed Metropolitan to reasonably

facilitate Meridian’s access to the groundwater on the Property,

which Meridian was required by North Carolina authorities to

monitor periodically.               Further, the district court did not err

in concluding that Metropolitan’s repeated destruction of the

groundwater      monitoring         wells    was   patently       unreasonable,      given

the   absence    of     any    record       evidence      explaining      or     justifying

Metropolitan’s conduct.              See Burton v. Williams, 689 S.E.2d 174,

177 (N.C. Ct. App. 2010); Harris v. Stewart, 666 S.E.2d 804, 808

(N.C. Ct. App. 2008).

            Accordingly, we affirm the judgment of the district

court.     We dispense with oral argument because the facts and

legal    contentions       are       adequately      presented      in     the    material

before   this    Court        and    argument      will    not    aid    the   decisional

process.

                                                                                  AFFIRMED

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