The LaSalle Group, Inc. v. Pendleton
2:12-cv-10821
E.D. Mich.Feb 26, 2014Background
- Plaintiff LaSalle entered a Subcontract Agreement with Tiger Masonry for a Gulfport, Mississippi project; Defendant had an ownership interest in Tiger.
- Defendant and his then-wife Green signed a Personal Guaranty agreeing to be personally liable for Tiger’s obligations under the Subcontract; Green did not actually sign, as Defendant signed her name without permission.
- Tiger defaulted on the Subcontract, and Plaintiff obtained a judgment against Tiger for $952,115.44, which remains unpaid.
- Plaintiff asserts breach of the Personal Guaranty and fraudulent misrepresentation (for forging Green’s signature), seeking recovery plus fees.
- Defendant did not respond to the Motion for Summary Judgment; the court considers the motion on the briefs.
- The court addresses choice-of-law, but finds liability under the guaranty under either Michigan or Mississippi law; damages and fees are awarded in the instant litigation.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Is Pendleton liable on the Personal Guaranty for Tiger's obligations? | Pendleton assumed personal liability for Tiger's performance. | No defense stated; Pendleton disputes enforceability due to mis-signature. | Yes; Pendleton liable for breach of the Personal Guaranty. |
| Whether Plaintiff is entitled to reasonable attorney’s fees in this action to enforce the guaranty. | Guaranty provides for fees in actions to enforce it. | No fee entitlement for this litigation under the guaranty. | Yes; Plaintiff awarded reasonable attorney’s fees incurred in this action. |
| Whether the fraudulent misrepresentation claim is actionable based on forging Green’s signature. | Forgery and material misrepresentation induced entering the Subcontract. | Unclear signature issues; law does not support misrepresentation claim. | Yes; summary judgment in favor of Plaintiff on fraudulent misrepresentation. |
| What choice of law governs the contract and whether it affects liability? | Courts should apply the state law that best respects the contract. | State law should be determined to potentially limit liability. | Liability under the guaranty is upheld under either Michigan or Mississippi law; choice of law does not change result. |
| Whether summary judgment was proper given the nonresponse of the defendant. | Plaintiff’s briefing establishes entitlement. | No response to test the moving party's burden. | Granted; the moving party's burden met despite lack of response. |
Key Cases Cited
- Celotex Corp. v. Catrett, 477 U.S. 317 (Supreme Court 1986) (movant bears initial burden on summary judgment)
- Calderone v. United States, 799 F.2d 259 (6th Cir. 1986) (summary judgment standard in the Sixth Circuit)
- Pack v. Damon Corp., 434 F.3d 810 (6th Cir. 2006) (summary judgment requires genuine disputes of material fact)
- Carver v. Bunch, 946 F.2d 451 (6th Cir. 1991) (nonresponse to motion for summary judgment cannot alone grant summary judgment)
- Klaxon Co. v. Stentor Elec. Mfg. Co., 313 U.S. 487 (U.S. 1941) (choice of law in cases of no express provision follows forum state's rules)
- Uhl v. Komatsu Forklift Co., 512 F.3d 294 (6th Cir. 2008) (applying Michigan choice-of-law principles in diversity cases)
- Mill’s Pride, Inc. v. Continental Ins. Co., 300 F.3d 701 (6th Cir. 2002) (restatement conflict-of-laws approach for contract choice)
- Gass v. Marriott Hotel Servs., Inc., 558 F.3d 419 (6th Cir. 2009) (tort choice-of-law generally follows Michigan law when appropriate)
- Titan Ins. Co. v. Hyten, 491 Mich. 547 (Michigan 2012) (elements of fraudulent misrepresentation; Michigan standard applied)
- Allmand Assoc., Inc. v. Hercules Inc., 960 F. Supp. 1216 (E.D. Mich. 1997) (factual sufficiency for misrepresentation under Michigan law)
