United States District Court, E.D. Kentucky, Northern Division
MEMORANDUM OPINION AND ORDER
R. WILHOIT. JR. UNITED STATES DISTRICT JUDGE.
matter is before the Court upon Plaintiff Caterpillar
Financial Services Corporation's Motion for Partial
Summary Judgment [Docket No. 36]. The matter has been fully
briefed by the parties and for the reasons set forth herein,
the Court will sustain the motion.
filed this civil action seeking to enforce certain guaranty
and security agreements pertaining to the purchase of various
heavy machinery. The primary obligor is Defendant Redbud
Dock, LLC. Defendants Appalachian Mining and Reclamation,
LLC, Producers Dock, Inc, Producer's Coal, Inc, Dennis
Johnson and Mark Pinson are each guarantors on the various
instant motion pertains only to Defendant Mark Pinson and the
claim alleged against him in Count V of the Complaint. As set
forth in Count V of the Complaint, on or about December 19,
2014, Redbud, by and through Defendant Johnson, executed an
Installment Sale Contract with Cecil I. Walker Machinery Co.
("Walker Machinery"), for the purchase of a
Caterpillar CM210 continuous miner, Serial No. GEA00813 (the
"Continuous Miner"), for the aggregate amount of
$1, 601, 900.49, with installment payments and finance
charges as set out therein. [Affidavit of Jamie Jarrett,
Special Accounts Representative, Caterpillar Financial
Services Corporation, Docket No. 36-2, ¶ 7.]
to the terms of the contract, Redbud granted a valid and
enforceable lien upon and a security interest in the
Continuous Miner to Walker Machinery, in order to secure
payment of its indebtedness and the performance of all of
Redbud's obligations under the contract. Id. The
security interest granted to Walker Machinery included all
attachments, accessories and optional features for the
Continuous Miner and all substitutions, replacements,
additions and accessions thereto and proceeds thereof.
order to further secure payment of the contract, Defendant
Pinson executed and delivered to Walker Machinery his
guaranty agreement (the "Pinson Guaranty").
Id., ¶ 10. Pursuant to the explicit terms of
the Pinson Guaranty, Defendant Pinson absolutely and
unconditionally guaranteed to Walker Machinery "the
prompt payment, performance and satisfaction of all present
and future indebtedness and obligations of Redbud due in
connection with or arising out of Contract #731535,
Transaction Number 2499257, of any kind or nature, present or
future, whether direct or indirect (including those acquired
by assignment, or otherwise), absolute or contingent, joint
or several, due or to become due, existing or hereafter
arising, including all amendments, modifications, or
superseding documents to each of the foregoing, all charges,
expenses, fees, including but not limited to reasonable
attorneys' fees, and any other sums chargeable to under
any of the foregoing." Id. Exhibit B, § 1.
Caterpillar Financial provided the purchase money financing,
and Walker Machinery executed an Assignment of Installment
Sale Contract [Without Recourse] in favor of Caterpillar
Financial as assignee (the "Assignment").
Id. Exhibit. C. As a result of the Assignment,
Caterpillar Financial became the holder and beneficiary of
contract and of the Pinson Guaranty. Pursuant to the terms of
the contract and the Pinson Guaranty, Redbud and Pinson were
required to make payments to Caterpillar Financial as the
assignee of Walker Machinery.
Financial perfected its security interest in the Continuous
Miner by filing a UCC-1 financing statement with the Kentucky
Secretary of State on January 9, 2015. Id., ¶
record reveals that Redbud failed to make the payments to
Caterpillar Financial as required under the contract and, as
such, was in default under the contract. Id., ¶
19. Pinson, also, failed to make the payments to Caterpillar
Financial as required under the Pinson Guaranty.
Id., ¶ 26. Therefore, Pinson was also in
default of the terms of the Pinson Guaranty.
plot then thickens. Defendants Johnson, Redbud, Appalachian
Mining and Producer's Coal filed for bankruptcy.
Plaintiff was involved in the bankruptcy actions and the
appurtenant negotiations for the recovery and sale of its
collateral. Among the collateral sold in those proceedings
was the Continuous Miner. The final sale price of which was
$785, 000.00 and Plaintiff has received the proceeds of the
sale. Id., ¶ 23.
August 21, 2018, Plaintiff sent Pinson notice of the
deficiency, stating that following the above-described
bankruptcy court sale of the Continuous Miner and application
of the sale proceeds received by Caterpillar Financial, as of
August 21, 2018, there is a remaining unpaid balance due and
owing thereon to Caterpillar Financial of $1, 004, 062.42,
with interest thereon at the rate of 5.95% annual percentage
rate or $253.42 per diem from August 21, 2018 until paid,
plus late charges and such other costs, expenses and damages
incurred. Id. Exhibit E.
seeks summary judgment against Pinson, arguing that no issues
of fact remain as it to validity and enforceability of the
Pinson Guaranty and that ...