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Johns v. R & D Towing, Inc.

United States District Court, S.D. West Virginia, Beckley

December 30, 2019

ROBERT L. JOHNS, Trustee, Plaintiff,
v.
R & D TOWING, INC., Defendant.

          MEMORANDUM OPINION AND ORDER

          FRANK W. VOLK UNITED STATES DISTRICT JUDGE.

         Pending are Defendant's Motion for Summary Judgment and Plaintiff's Motion for Partial Summary Judgment [Dckt. 26, 28], both filed July 30, 2019. Plaintiff Robert L. Johns, Trustee (“Trustee”), filed a Response on August 18, 2019 [Dckt. 33], and Defendant R & D Towing, Inc. (“R & D”) replied on August 20, 2019 [Dckt. 35]. R & D filed a Response on August 18, 2019 [Dckt. 32], and the Trustee replied on August 20, 2019 [Dckt. 34].

         I.

         A. Facts and Procedural History

         This matter arises out of a Chapter 11 bankruptcy case filed by debtor Machinery Transport, Inc. (“MTI”). The case was subsequently converted to a Chapter 7 liquidation case. The Trustee was then appointed to administer the Chapter 7 case. The Trustee initiated an adversary proceeding on behalf of MTI against R & D alleging breach of contract, negligence, and destruction of property. The undisputed facts are as follows.

         R & D is a towing business with an office, garage, and impound lot located in White Sulphur Springs near Howard's Creek. MTI stored personal property and equipment on R & D's property. At all relevant times, both R & D and MTI were owned by Mr. Ronald Cook. On June 23, 2016, catastrophic flooding occurred in White Sulphur Springs, as well as other areas in southern West Virginia. Upon observation that Howard's Creek was rising, Mr. Cook moved MTI's equipment within an “insured area” of the property. Thereafter, Mr. Cook left R & D to assist his neighboring business owner with placing sandbags around the doors of her restaurant. Mr. Cook then went to Lowe's to purchase additional sandbags but was unable to return to the restaurant due to the high flood waters. R & D's property flooded, and MTI's equipment was damaged as a result. After the flood, MTI requested compensation from R & D for the damaged equipment, which R & D denied.

         On May 16, 2018, the Trustee initiated this proceeding on behalf of MTI against R & D alleging breach of contract, negligence, and destruction of property. Specifically, the Trustee alleged that R & D had a duty to exercise ordinary care for the safety and security of MTI's equipment and failed to exercise such care, which caused MTI to suffer injury and damages. The Trustee sought damages for the injury to MTI's equipment, as well as the loss of use and market value of the equipment.

         On July 30, 2019, R & D and the Trustee filed cross-motions for summary judgment. R & D moved for summary judgment on the grounds that there is no genuine issue of material fact and that it is not liable for the damages to MTI's equipment. The Trustee moved for partial summary judgment on the grounds that there is no genuine issue of material fact and that R & D is liable for the damages to MTI's equipment as a matter of law.

         II.

         A. Governing Standards and Analysis

         Federal Rule of Civil Procedure 56 provides that summary judgment is proper where “the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(a). The burden is on the nonmoving party to show that there is a genuine issue of material fact for trial. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). “The nonmoving party must do so by offering ‘sufficient proof in the form of admissible evidence' rather than relying solely on the allegations of her pleadings.” Guessous v. Fairview Prop. Invs., LLC, 828 F.3d 208, 216 (4th Cir. 2016) (quoting Mitchell v. Data Gen. Corp., 12 F.3d 1310, 1316 (4th Cir. 1993)). The Court must “view the evidence in the light most favorable to the [nonmoving] party.” Tolan v. Cotton, 572 U.S. 650, 657 (2014) (internal quotation marks omitted); Variety Stores, Inc. v. Wal-Mart Stores, Inc., 888 F.3d 651, 659 (4th Cir. 2018).

         When faced with cross-motions for summary judgment, the Court applies the above standard and must consider “each motion separately on its own merits to determine whether either of the parties deserves judgment as a matter of law.” Rossignol v. Voorhaar, 316 F.3d 516, 523 (4th Cir. 2003) (internal quotation marks omitted). “The court . . . cannot weigh the evidence or make credibility determinations.” Jacobs v. N.C. Admin. Office of the Courts, 780 F.3d 562, 569 (4th Cir. 2015); see also Lee v. Town of Seaboard, 863 F.3d 323, 327 (4th Cir. 2017). In general, if “an issue as to a material fact cannot be resolved without observation of the demeanor of witnesses in order to evaluate their credibility, summary judgment is not appropriate” Fed.R.Civ.P. 56 advisory committee's note to 1963 amendment.

         Bailment is created by operation of law when there is “a delivery of the property for safe-keeping by the bailor, and an acceptance thereof by the bailee.” Barnette v. Casey, 124 W.Va. 143, 146, 19 S.E.2d 621, 623 (1942). In negligence actions involving bailment, the Supreme Court of Appeals of West Virginia has observed as follows:

In an action involving a bailment for hire proof by the bailor of delivery of the property to the bailee and of his failure to redeliver it upon legal demand establishes a prima facie case of negligence upon the part of the bailee and the burden of going forward with the evidence shifts to the bailee to show that his failure to redeliver was without his fault or negligence; but the burden of proof does not shift with the evidence but ...

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