Sure, Inc. v. Premier Petroleum, Inc.
343 Ga. App. 219
| Ga. Ct. App. | 2017Background
- Sure, Inc. (owner/operator of a Shell-branded gas station) and Premier Petroleum entered a Supply Agreement (exclusive supplier; $0.02/gal rebate for three years) and Premier extended a $56,000 loan secured by an adjacent one-acre lot (Deed to Secure Debt) and guaranteed by Sure’s principal, Natt Nwokolo.
- Premier disbursed only $6,000 directly to Sure and paid $14,000 to B&B for pump work; Sure contends the $14,000 payment was unauthorized and the authorization signature was forged. Sure later notified Premier it would not accept the loan.
- Premier declared Sure in default, foreclosed on the adjacent property, and acquired it as highest bidder. Premier also withheld Sure’s credit-card receipts and netted them against gasoline charges.
- Sure filed two bankruptcies; during the second, the bankruptcy court approved rejection of the Supply Agreement and later dismissed the case without discharge. The bankruptcy court denied a motion to compel turnover of credit-card receipts, directing an adversary proceeding instead.
- Sure sued Premier in state court (breach of contract for rebate and withheld credit-card proceeds; wrongful foreclosure; fraud). The trial court granted Premier summary judgment on all claims; Sure appealed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Effect of bankruptcy rejection on Sure’s breach claims | Rejection under §365 does not eliminate already-executed obligations (rebate and retained card proceeds); Sure may sue for those breaches | Rejection rescinded the contract and deprived Sure of standing to sue for contract breaches | Rejection does not bar claims based on executed portions; reversal as to breach claims |
| Judicial estoppel for failing to list rebate in bankruptcy | Failure to list claim in a bankruptcy that ended without discharge does not justify estoppel; no unfair advantage to Sure | Sure’s nondisclosure should bar the claim | Estoppel improper where bankruptcy was dismissed without discharge; reversal as to rebate claim |
| Collateral estoppel re: credit-card receipts | Bankruptcy court’s procedural refusal (requiring adversary) was not a merits adjudication; claim not precluded | Issue already litigated/adjudicated in bankruptcy | Collateral estoppel does not apply; Sure may pursue credit-card claim |
| Wrongful foreclosure / tender requirement | Tender requirement excused because Premier’s conduct (withholding card receipts) caused default (raised on appeal) | Sure failed to tender amounts due; cannot seek equitable relief to set aside foreclosure | Summary judgment affirmed: Sure failed to tender and waived new causation argument by not raising it below |
| Fraud (intent at loan formation) | Premier never intended to advance full loan; scheme to acquire collateral — evidence: withheld funds, unauthorized $14,000 payment, alleged forged signature and later foreclosure | Fraud cannot be established from mere breach or promises as to future; insufficient evidence of intent, reliance | Reversed as to fraud claim arising from alleged present intent not to fund the loan and authorization forgery — genuine issues of material fact exist; other fraud theories not raised below are affirmed against Sure |
Key Cases Cited
- Cowart v. Widener, 287 Ga. 622 (appellate review standard for summary judgment)
- Puett v. McCannon, 183 Ga. App. 152 (rejection under §365 constitutes breach but does not erase claims)
- Thompkins v. Lil’ Joe Records, Inc., 476 F.3d 1294 (rejection frees estate from future performance; does not cancel executed provisions)
- In re Shelbyville Road Shoppes, LLC, 775 F.3d 789 (section 365 affects only future obligations)
- Dillard-Winecoff, IBF Participating Income Fund v. Dillard-Winecoff, 275 Ga. 765 (judicial estoppel framework; dismissal without discharge weighs against estoppel)
- Speir v. Nicholson, 202 Ga. App. 405 (distinguishing facts where executory performance not completed)
- York v. RES-GA LJY, LLC, 300 Ga. 869 (collateral estoppel/issue preclusion elements)
- JTH Tax, Inc. v. Flowers, 302 Ga. App. 719 (fraud generally not based on future promises unless present intent to deceive)
- BTL COM Ltd. v. Vachon, 278 Ga. App. 256 (infer fraudulent intent from suspicious post-contract conduct)
- Roberts v. Nessim, 297 Ga. App. 278 (elements of fraud and summary-judgment standard for fraud)