United States District Court, Southern District of Mississippi, Northern Division
THOMAS P. MCDONNELL, III PLAINTIFF
SANDY MILLER DEFENDANT
MEMORANDUM OPINION AND ORDER
CARLTON W. REEVES, UNITED STATES DISTRICT JUDGE
Having waived their right to a trial by jury, the parties tried this action before the Court on April 2, 2014, without a jury. See Fed.R.Civ.P. 38(d). After carefully considering the record of this case together with the evidence adduced at trial, having observed the demeanor of the witnesses, having read and considered the proposed findings of fact and conclusions of law submitted by the parties (pretrial and post-trial), and being otherwise fully advised in the premises, for the reasons discussed below, the Court now by a preponderance of the evidence finds that a verdict shall be returned in favor of Defendant, Sandy Miller, and against the Plaintiff, Thomas McDonnell, for the following reasons:
This suit arises out of a breach of contract dispute for sale of stock. The Court has jurisdiction over this matter because McDonnell is a resident of the State of Mississippi while Miller is a resident of Florida, and the amount in controversy exceeds $75, 000. See 28 U.S.C. § 1332. The parties are former business partners, serving as Co-CEO’s and Co-Chairmen of U-Save Holdings, Inc. (“U-Save”), a corporation headquartered in Mississippi. The facts were hotly contested.
McDonnell’s complaint states that Miller has not fulfilled his obligation to pay under their oral and written contract agreements. McDonnell is entitled to a judgment in the amount of $751, 704.00 plus interest from October 26, 2006, he claims. The complaint alleges several causes of actions: (1) breach of contract for failure to satisfy $300, 000 down payment obligation; (2) breach/default of promissory note; (3) breach of quasi-contract/unjust enrichment; (4) equitable estoppel; (5) or a constructive trust should be imposed. Miller subsequently filed a motion for partial judgment on the pleadings, Docket No. 24, in which it argued that counts 1, 3, 4, and 5 should be dismissed. McDonnell also filed a motion for partial summary judgment, Docket No. 48, as to count 2 of his complaint.
Prior to trial, the Court heard arguments on those motions. On February 13, 2014, the Court granted Miller’s motion for partial judgment on the pleadings, and denied McDonnell’s motion for partial summary judgment. Thus, the only claim heard at trial was Miller’s alleged breach of contract claim for failure to pay the balance owed on the promissory note. This Order addresses this claim.
A. Plaintiff’s side of the story
Plaintiff claims that the current issue emanates from an agreement formed on October 26, 2006. McDonnell asserts that the parties agreed that he would sell to Miller 93, 963 shares of U-Save Holdings stock at $8 per share for a total price of $751, 704.00. Under the agreement, Miller promised to render a down payment of $300, 000.00 on October 26, 2006. Trial Transcript of McDonnell at 106 (hereinafter “Tr.”). This agreement, however, was never reduced to writing. McDonnell agreed to finance the remaining balance of $451, 704.00, Ex. P-1, which required the balance to be paid on or before October 20, 2009. This agreement was memorialized in a promissory note signed by Miller. See id.; Docket No. 1-2. The promissory note does not mention that it is related to a stock purchase agreement and does not mention the shares Miller received. It stipulates that, if Miller breached his duty to repay his debt, he would be responsible for “court costs, reasonable attorney fees, and other reasonable collections charges” if his breach resulted in a lawsuit. Id. at 2.
The day after the agreement was reached, on October 27, 2006, Kendall Moore (U-Save’s General Counsel) sent an email to Bob Barton (former U-Save President and Chief Operating Officer), which states, “[a]s of October 26, 2006, [Miller] purchased 93, 963 shares from [McDonnell].” Exhibit P-6. The email also stated that McDonnell was owed $300, 000 and payment on a promissory note for $451, 704 bearing interest at 6%. Id.
Almost three years later, in an email dated December 29, 2009-two months after the promissory note’s maturity date-McDonnell expressed to Miller that he expected payment on the promissory note as agreed. Exhibit P-8; see also Tr. at 114. He also stated that if it was never Miller’s intention to repay the loan, he “need[ed] to know.” Id. Miller responded with an email expressing his understanding that he would not be required to pay the loan. Id.
Three more years past, and on March 22, 2012, McDonnell issued a detailed letter to Miller, reminding him of his obligation to repay the loan (including the rising interest). Exhibit P-9; see also Tr. at 115. McDonnell did not receive a response from Miller, see Tr. at 115, and, on June 26, 2012, he sent another letter to Miller restating the concerns in his previous letter and informed Miller that he had retained counsel. Nearly a month later, McDonnell emailed Miller imploring him once again to pay off the debt, and offered him a one-year extension in which to do so.
B. Defendant’s side of the story
Obviously, Defendant, provides a different version of the facts. Miller alleges that circumstances leading up to the current issue provides insight into the true nature of this suit.
When Miller joined U-Save in 2003, he and McDonnell agreed to share an equal interest in the company. Tr. at 223. Based on U-Save’s audited financial statements, Miller paid $2.75 million for his equal shares of the company for a total of 428, 553 shares, which is reflected in a signed ...