United States District Court, D. Arizona
ORDER
Honorable John Z. Boyle United States Magistrate Judge
Pending
before the Court is Plaintiff Azerbaijan Ministry of
Defense's (AMOD) Motion for Summary Judgment against
Defendant Robert Reish. (Doc. 78.) Defendant Reish has failed
to file a response to the Motion and the time to do so has
passed. Accordingly, after review, the Court will grant
Plaintiff's Motion, enter judgment against Defendant
Reish on Plaintiff's Breach of Contract Claim, and award
damages to Plaintiff in the amount of $2.1
million.[1]
I.
Background.
The
following facts are undisputed.
a.
Parties.
Plaintiff
AMOD is “a foreign government agency, by and through
its Authorized Agent, Syntelco, Limited, a Limited Liability
Company.” (Doc. 79, ¶ 1.) Defendant Robert Reish
is an individual residing in Hawaii. (Id., ¶
2.) Third party Defendants, Tina and Darin Cannon, reside in
Arizona, and served as officers of Phoenix Heliparts (PHP), a
company in the business of restoring and rebuilding damaged
aircraft. (Id., ¶ 3.) PHP filed for Chapter 11
bankruptcy protection on September 21, 2015. (Id.)
b.
Helicopter Purchase Agreement Between AMOD and
Reish.
On
November 11, 2015, AMOD and Reish entered into a Helicopter
Purchase Agreement (Purchase Agreement) (doc. 78-6, Ex. F, at
1-4) for the sale and delivery of MD 530F helicopter, Serial
Number 0041FF (the 41FF). (Doc. 79, ¶ 4.) Reish had
previously purchased the 41FF from PHP for $1.395 million.
(Id., ¶ 5.) The Purchase Agreement between
Reish and AMOD required Reish to deliver the 41FF helicopter
to AMOD in a fully-operational and airworthy condition.
(Id., ¶ 6.) Specifically, the Purchase
Agreement states:
Delivery Condition: The Helicopter will be delivered with all
systems operational, Flight records up to date, all mandatory
Federal Aviation Administration (“FAA”)
Airworthiness Directives and Service Bulletins complied
with..
(Doc. 78-6 at 3, ¶ 4.) In exchange for delivering a
fully-operational 41FF helicopter, AMOD agreed to pay Reish
$2.15 million. (Id. at 3, ¶ 1; Doc. 79, ¶
7.) Also included in the Purchase Agreement is an integration
clause, which states
This purchase agreement, along with the attached invoice and
escrow statement, is the only contract controlling this
purchase and sale of the said Helicopter, and contains all
agreements, expressed or implied whether verbal or in
writing, between the PURCHASER [AMOD] and the SELLER [Reish].
(Doc. 78-6 at 4, ¶ 11; Doc. 79, ¶ 9.) No. contract
or agreement exists between Reish and AMOD beyond the
Purchase Agreement. (Doc. 79, ¶ 8.) The Purchase
Agreement's cover page provides that “[a]ny changes
[to the Purchase Agreement] must be executed by [AMOD] and
[Reish] in writing, and mutually agreed to.”
(Id., ¶ 10; Doc. 78-6 at 2.)
c.
Performance Under the Purchase Agreement.
On
November 25, 2015, AMOD, via escrow, wired Reish the full
purchase price of $2.15 million, fully performing its
obligations under the Purchase Agreement. (Doc. 79,
¶¶ 11-12; Doc. 78-1, Ex. A, at 18-19 (Reish
deposition transcript acknowledging that he received the full
purchase price of the aircraft and that AMOD complied
“with its obligations to [Reish] as the seller of this
aircraft[.]”); Doc. 78-3, Ex. C, at 7 (Reish answering
an interrogatory, affirming that he received a wire from AMOD
via escrow on November 25, 2015, in the amount of $2.15
million).)
Reish,
despite receiving the full purchase price for the 41FF,
“never delivered a fully-operational helicopter to AMOD
at any time.” (Doc. 79, ¶ 13.) Reish asserts that
he never delivered the 41FF helicopter to AMOD because it was
PHP's responsibility to do so. (Id., ¶ 14.)
“There is no written agreement between Reish and AMOD
‘that PHP is obligated to make it airworthy for
them'” (id., ¶ 15), and
“[t]here is no agreement between Reish and AMOD and PHP
‘that PHP would make the aircraft airworthy”
(id., ΒΆ 16). To date, the 41FF ...