Joseph H. Page v. Farm Credit Services, etc.
734 F.3d 800
8th Cir.2013Background
- Appellants Brad Haun, Michelle Haun, Carole Haun, Cecil Haun, Carol Knisley, Shirley Knisley, Joseph Page, and Frances Page own/manage Big Drive Cattle, LLC and entered into 2010 Farm Credit loan documents.
- Farm Credit reserved collateral inspection rights, including cattle, under the notes/loans; appellants personally guaranteed the obligations separate from Big Drive's entity.
- Some Big Drive cattle went missing after an employee theft; reports were falsified to cover the thefts.
- Big Drive defaulted when notes matured; Big Drive filed for bankruptcy; Farm Credit demanded payment from the guarantors.
- Appellants asserted counterclaims for negligence, negligent misrepresentation, and breach of the duty of good faith; district court dismissed without prejudice then with prejudice.
- Farm Credit paid the amounts due under the notes/loans; Farm Credit's related claims against appellants were dismissed; appeal focuses on appellants' counterclaims.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Duty to report accuracy | Appellants contend Farm Credit owed a duty to provide accurate collateral reports. | Farm Credit had no contractual duty to supply such reports beyond loan terms. | District court dismissal affirmed; no plausible duty shown. |
| Negligent misrepresentation with intent | Appellants rely on misrepresentation surrounding collateral reports. | No intent pleaded; misrepresentation claim fails under Rule 9(b). | Negligent misrepresentation claim dismissed for lack of intent and particularity. |
| Breach of good faith and fair dealing | Appellants seek damages for breach of implied covenant arising from contract-related conduct. | No damages pleaded; breach claim lacks tangible injury and contract breach basis. | Breach of good faith claim dismissed for failure to plead damages. |
Key Cases Cited
- Young v. City of St. Charles, Mo., 244 F.3d 623 (8th Cir. 2001) (standard for motions to dismiss and plausible claims)
- Bradley Timberland Res. v. Bradley Lumber Co., 712 F.3d 401 (8th Cir. 2013) (plausibility standard for complaint sufficiency)
- Bell Atl. Corp. v. Twombly, 550 U.S. 544 (U.S. 2007) (pleading requires plausible claims)
- Ashcroft v. Iqbal, 556 U.S. 662 (U.S. 2009) (rejects bare assertions; requires factual enhancement)
- Retro Television Network, Inc. v. Luken Commc'ns, LLC, 696 F.3d 766 (8th Cir. 2012) (plausibility standard and dismissal guidance)
- Christiansen v. West Branch Cmty. Sch. Dist., 674 F.3d 927 (8th Cir. 2012) (authority on district court de novo review and pleading)
- Wycoff v. Menke, 773 F.2d 983 (8th Cir. 1985) (predecessor authority on pleading and burden)
- Hamilton v. Palm, 621 F.3d 816 (8th Cir. 2010) (unrecognized duties require substantial authority)