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Kurt Lepping v. David L. Greeno and Wendy C. Greeno

September 23, 2011

KURT LEPPING, PLAINTIFF,
v.
DAVID L. GREENO AND WENDY C. GREENO, DEFENDANTS.



The opinion of the court was delivered by: John W. Sedwick United States District Judge

ORDER AND OPINION

[Re: Motion at Docket 44]

I. MOTION PRESENTED

At docket 44, plaintiff Kurt Lepping ("plaintiff" or "Lepping") moves pursuant to Federal Rule of Civil Procedure 56 for summary judgment. Defendants David and Wendy Greeno ("defendants" or "the Greenos") oppose the motion at docket 50. Plaintiff's reply is at docket 61. Oral argument was heard on September 22, 2011.

II. BACKGROUND

In 2005, Lepping and the Greenos jointly purchased a tract of land in the Matanuska-Susitna Valley, intending to develop and subdivide it. In 2006, the parties formed Paradise Properties, LLC, with the assistance of a lawyer, John Davies ("Davies"), and transferred the property to the company. Davies forwarded the deed that transferred the tract to the company to the Greenos along with a draft operating agreement that the parties had discussed. The Greenos were advised to seek independent legal advice to assist with review of the operating agreement. The operating agreement provided that Lepping would have sole managerial authority even though Lepping and the Greenos each had a fifty-percent interest in the LLC. The Greenos maintain that they were sidetracked and never agreed to or signed the operating agreement. Lepping maintains that the operating agreement is indicative of the parties' agreement and that the Greenos assented to its terms.

Complaints from neighbors delayed approval of the subdivision by the Matanuska-Susitna Borough. Those issues were resolved in 2008. Lepping maintains that, at that time, the Greenos informed him they would no longer contribute to the project. The Greenos maintain that Lepping commingled personal and company funds and could not properly account for expenditures. Lepping sent the Greenos letters stating that they were in breach of the operating agreement and attempted to complete the project on his own. The Greenos informed the Borough that they disputed Lepping's managerial authority and requested that approval of the subdivision be postponed until the parties' dispute was resolved.

Lepping filed suit in the Superior Court for the State of Alaska at Palmer asserting claims for breach of contract and promissory estoppel, seeking damages and injunctive relief. The case was removed to federal court in July 2010 on the basis of diversity jurisdiction.*fn1

III. STANDARD OF REVIEW

Summary judgment is appropriate where "there is no genuine issue as to any material fact and . . . the movant is entitled to judgment as a matter of law."*fn2 The materiality requirement ensures that "only disputes over facts that might affect the outcome of the suit under the governing law will properly preclude the entry of summary judgment."*fn3 Ultimately, "summary judgment will not lie if the . . . evidence is such that a reasonable jury could return a verdict for the nonmoving party."*fn4

In resolving a motion for summary judgment, a court must view the evidence in the light most favorable to the non-moving party.*fn5 The reviewing court may not weigh evidence or assess the credibility of witnesses.*fn6 The burden of persuasion is on the moving party.*fn7

IV. DISCUSSION

A. The Operating Agreement

Lepping argues that the Greenos are bound by the terms of the draft operating agreement. There are several issues of material fact precluding summary judgment on Lepping's breach-of-contract claim. Foremost, the Greenos maintain that they never expressed assent to the terms of the operating ...


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