Ivy Testing Serv. v. S&S Commercial, Inc.

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IVY TESTING SERVICE, INC. PLAINTIFF v. S&S COMMERCIAL, INC. and DEBRA J. SILLIMAN DEFENDANTS

CIVIL No. 1:23cv168-HSO-BWR

United States District Court, S.D. Mississippi, Southern Division

April 24, 2024

MEMORANDUM OPINION AND ORDER GRANTING DEFENDANT DEBRA J. SILLIMAN'S MOTION [27] TO DISMISS

HALIL SULEYMAN OZERDEN UNITED STATES DISTRICT JUDGE

BEFORE THE COURT is Defendant Debra J. Silliman's Motion [27] to Dismiss all claims brought against her by Plaintiff Ivy Testing Service, Inc. for failure to state a claim upon which relief can be granted. After due consideration of the Motion [27], the parties' submissions, and relevant legal authority, the Court finds that the Motion [27] should be granted, and that Plaintiff Ivy Testing Service, Inc.'s claims against Defendant Debra J. Silliman should be dismissed with prejudice.

I. BACKGROUND

A. Factual background

On or about June 23, 2022, Plaintiff Ivy Testing Service, Inc. (“Plaintiff” or “Ivy Testing”) entered into a subcontract with Defendant S&S Commercial Inc. (“S&S Commercial”), who is not a party to this Motion [27], for “drilling services at the NASA, Stennis Space Center.” Mem. [34] at 2. Plaintiff had completed approximately forty percent of the work under the subcontract when S&S Commercial was terminated by the prime contractor, Civil Works Contracting, LLC (“CWC”). Am. Compl. [25] at 2. Plaintiff invoiced S&S Commercial for a total of $522,806.24, “per the parties' Subcontract, agreement, and at S&S Commercial's discretion[,]” of which $348,915.04 remains unpaid. Id. Plaintiff claims that “[d]espite demand, S&S Commercial has failed and refused to pay Ivy Testing the Project balance due of $348,915.04.” Id. at 3. Plaintiff has filed suit against both Defendants seeking to recover $348,915.04. Id. at 3-5.

Of relevance to the present Motion [27], the Amended Complaint [25] alleges that Defendant Debra J. Silliman (“Silliman”), S&S Commercial's President, “acting in her personal capacity, promised to pay the debt owed to Ivy Testing[,]” id. at 3, and that “[d]espite personally guaranteeing payment to Ivy Testing, Silliman has failed and refused to pay Ivy Testing[,]” id. Plaintiff supports this claim with three emails Silliman sent to Plaintiff^[1] or its counsel before suit was filed, while the parties were attempting to resolve the outstanding balance. See id.; Ex. [25-4]; Ex. [25-5]; Ex. [25-6]. The question presented in the Motion [27] to Dismiss is whether Plaintiff can hold Silliman personally liable for S&S Commercial's outstanding debt based upon these emails. See generally Mem. [28]; Mem. [34].

The first email was sent by Silliman on March 15, 2023. See Ex. [25-4]. In it, Silliman offered a settlement of $160,188.88 to resolve S&S Commercial's debt to Plaintiff, and Silliman broke down what she believed S&S Commercial owed into four items. Id. at 1-2. For example, her email stated that the outstanding balance on “Item #1” was:

Total of all Drills performed and billed: $303,367.00

Total Paid to Dated: ($173,891.20)

Balance Due On this Item: $129,465.80

S&S Commercial, Inc [sic] guarantees payment of this balance without question. CWC still owes me money on this and we are confident we will be paid on this from CWC even if we have to make a bond claim on it. Understand I am planning to pay you even if I do not get paid from CWC in a settlement and I will chase the bond company myself on this.

Id. at 1 (“($173,891.20)” appears in red in the original email). Regarding “Item #2['s]” outstanding balance of $24,000.00 and “Item #3['s]” outstanding balance of $6,713.08, Silliman stated that “S&S Commercial, Inc [sic] will guarantee payment on th[ese] item[s].” Id.

As for “Item #4[,]” Silliman did not believe that she would be able to collect from CWC on “Downtime” charges for labor and equipment, which totaled $134,104.30, Id. at 1-2, and these charges were not included in her settlement offer. Silliman requested that Plaintiff advise her of what must be paid for Plaintiff “to be satisfied on [the] downtime charges.” Id. at 1-2. She concluded with “S&S Commercial, Inc [sic] will pay [Plaintiff] a total of $160,188.88[,]” and that “[i]f I get settled with CWC and they agree to pay me I will pay you out as soon as I get paid on that settlement from CWC.” Id. at 2.

Plaintiff responded with a request that S&S Commercial pay $265,500.00. Ex. [25-6] at 3. The same day, Silliman requested a copy of all invoices that showed a “detailed breakdown of what [Plaintiff is] charging on each of these items.” Id.

Silliman followed up on March 24, 2023, reiterating her need for a breakdown of the invoices, stating that she “cannot go to Stennis or CWC with a lump sum invoice under any circumstances.” Id. Silliman's email also stated in relevant part that:

I hope you can understand that I am looking at agreeing to paying [sic] an astronomical amount of money that I am not being paid and have no guarantee of ever being paid any of it.

...

So the overall picture is this:

I am paying out a total of $230,023.00 out of my pocket above the original contract amount for the drills that have been performed. That amount does not even include the 10% retainer that is being held.

I have paid out more money to you guys than I have collected from CWC on the drills that were performed.

SO as you can see, I figured my settlement offer to the maximum amount that I felt like I could afford to pay above what I have been paid.

Id. at 1-2.

On April 4, 2023, Plaintiff's counsel emailed Silliman seeking an update, to which Silliman responded:

I had sent a correspondence on March 24, 2023 to Mr [sic] Ronnie pertaining to our being able to reach an agreement among ourselves so we could have the attorney's [sic] draw up the agreement for finalization. I had made an offer that I thought was really fair of what I could take upon myself to pay out of my pocket to clear him out and he sent back a counter offer [sic] that was above what I can handle. I have discussed the issue with my attorney and have confirmed the information sent to Mr [sic] Ronnie that details what I owe contractually and what I was willing to take on myself in order to try to get Mr [sic] Ronnie taken care of.

Ex. [25-5] at 1. Silliman then recounted the earlier email exchanges, stating that she had requested a detailed breakdown of what was owed and never received a reply. Id. Silliman reiterated that she needed this detailed breakdown before she could go to CWC, the prime contractor, to seek payment. Id. Silliman further stated that despite the fact S&S Commercial had paid Plaintiff more than it had received from CWC, CWC was attempting to use the failure to pay Plaintiff as a reason to terminate S&S Commercial for cause. Id. Silliman claimed that she explained these circumstances to “Mr. Ronnie” and suggested Plaintiff's counsel converse with his client and get in touch with Silliman's attorney once the two “are on the same page.” Id.

B. Procedural history

Plaintiff filed the instant action on June 6, 2023, in the Circuit Court of Hancock County, Mississippi. State Court Documents [1-1] at 1. Plaintiff brought claims for breach of contract and quantum meruit against Defendants S&S Commercial and Silliman (collectively “Defendants”) for failure to pay the outstanding project balance. Id. at 6-7. Defendants removed the case to this Court on July 12, 2023, see Not. [1], and Silliman filed a Motion [4] to Dismiss, see Mot. [4].

Plaintiff filed an Amended Complaint [25] on October 12, 2023, bringing no new claims, see Am. Compl. [25], but in light of the Amended Complaint [25] the Court denied Silliman's Motion [4] to Dismiss without prejudice, Text Only Order, October 13, 2023. The Amended Complaint [25] advances claims for breach of contract (Count I) and quantum meruit (Count II) against S&S Commercial and Silliman. Am. Compl. [25] at 3-6. In its Amended Complaint [25], Plaintiff added a statement of jurisdiction, and alleged new facts concerning Plaintiff's work under the subcontract and the approval of the subcontract by CWC. Compare id. at 1-3, with State Court Documents [1-1] at 5-6. Silliman has now renewed her Motion [27] to Dismiss pursuant to Federal Rule of Civil Procedure 12(b)(6), see Mot. [27], and Plaintiff has not sought leave to further amend its pleadings.

C. Silliman's Motion [27] to Dismiss

1. Silliman's Motion [27]

Silliman argues that the Amended Complaint [25] fails to allege that she personally entered into a contract with Plaintiff guaranteeing the obligations of S&S Commercial because Plaintiff failed to plead any mutual assent or that any alleged agreement satisfies Mississippi's statute of frauds. Mem. [28] at 5-12. Silliman argues the emails attached to the Amended Complaint [25] demonstrate the lack of a meeting of the minds as to any personal guaranty, noting that in the April 4, 2023, email, she stated that she made an offer and Plaintiff made a counteroffer. Id. at 7.

Silliman next asserts that the alleged contract between her and Plaintiff would constitute a suretyship agreement, which under Mississippi law must be in writing, Id. at 9 (citing Miss. Code Ann. § 15-3-1(a)(1)), and that no signature showing “intent of the party at issue to be bound[,]” appears in the email, Id. at 12 (emphasis omitted). This is because the emails and signature block on them reflect that Silliman was acting in a representative capacity, and when a writing is signed in such a capacity, “it is only enforceable against the represented party and not the person signing in their individual capacity.” Id. at 12 (emphasis omitted) (citing Lambert Cmty. Hous. Grp., L.P. v. Wenzel, 987 So.2d 468, 473 (Miss. Ct. App. 2008)). Thus, Plaintiff's alleged agreement is with S&S Commercial and not Silliman. I...