Airline Support, Inc. v. ASM Capital II, L.P.
279 P.3d 599
Alaska2012Background
- ASM Capital II, L.P. offered to purchase Airline Support's Northwest Airlines bankruptcy claim for 32% of face value, sending a letter to Airline Support's Anchorage office.
- Airline Support forwarded the ASM letter to Katie Land, who identified herself as Airline Support's Accounting Manager in Georgia, and Land executed the attached Assignment of Claim Agreement.
- Airline Support paid ASM $19,862.72 and later notified bankruptcy court of the transfer; Airline Support then challenged the transfer as unauthorized by its officers.
- The superior court granted ASM summary judgment on apparent authority; the court held Land had apparent authority as a matter of law based on three elements, including manifestations, reliance, and reasonable interpretation.
- Airline Support appealed, arguing that Land lacked apparent authority and that the fee award for state-court proceedings should be limited; ASM cross-appealed on bankruptcy court fees.
- The appellate court reversed, holding genuine issues of material fact exist as to the reasonableness of ASM's reliance and remanded for trial, vacating the fee award related to the state proceeding.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Did Land have apparent authority as a matter of law? | Airline Support contends no apparent authority. | ASM contends manifest evidence supports apparent authority. | Genuine issues of material fact remain; not to be decided as a matter of law. |
| Was ASM's reliance on Airline Support's manifestations reasonable as a matter of law? | ASM's reliance was unreasonable as a matter of law. | ASM reasonably relied on manifestations of authority. | Reasonableness of reliance is a fact question; cannot be resolved on summary judgment. |
| Should ASM recover fees incurred in bankruptcy court? | Fees in bankruptcy court are recoverable under the agreement. | Only state-court fees are recoverable; bankruptcy fees are not awards here. | Fees awarded in state court vacated; bankruptcy fees not decided on this appeal. |
Key Cases Cited
- Bruton v. Automatic Welding & Supply Corp., 513 P.2d 1122 (Alaska 1973) (manifestations before reliance; apparent authority basics)
- City of Delta Junction v. Mack Trucks, Inc., 670 P.2d 1128 (Alaska 1983) (reversing summary judgment on apparent authority; jury evaluation appropriate)
- Anderson v. PPCT Mgmt. Sys., Inc., 145 P.3d 503 (Alaska 2006) (cited for standards on apparent authority and manifestation focus)
- Cummins, Inc. v. Nelson, 115 P.3d 536 (Alaska 2005) (apparent authority analysis and related considerations)