LAC Enterprises, Inc. v. Wholesale Tree, Inc.

Background

LAC Enterprises, Inc. obtained 27 oak trees from Wholesale Tree, Inc. and Braun Nursery, Ltd. for a landscaping contract involving downtown Rochester, Minnesota. The trees came from Braun Nursery in Ontario, Canada, were transported by a non-party company, and were sent to Jim Whiting Nursery in Rochester. Canadian inspection certificates dated May 20, 2020 stated that the trees were free from spongy moths. The trees arrived at Whiting Nursery in late May or early June 2020. The moths were reportedly discovered later in June, and a Minnesota Department of Agriculture inspection in July found spongy moth life stages. The trees were quarantined and ordered treated or destroyed; Rochester would not accept them for the project, and LAC instructed Whiting Nursery to burn and bury them.

LAC asserted four claims: breach of contract against Wholesale Tree; breach of the implied duty of good faith and fair dealing against both Defendants; promissory estoppel against both Defendants; and negligence against both Defendants. LAC’s theories all depended on proving that the trees were infested before they arrived at Whiting Nursery. Defendants separately moved for summary judgment, which is a procedure allowing a court to enter judgment without a trial when the evidence does not present a genuine dispute over facts that could affect the result.

Evidence and Analysis

The court held that LAC had not produced admissible evidence creating a genuine factual dispute about when the infestation began. LAC argued that the moths were already on the trees before they left Canada or while the trees were under Defendants’ control. LAC relied on its theory about the moths’ developmental stages and argued that expert testimony was unnecessary.

The court disagreed. It held that LAC needed expert testimony explaining the moths’ life stages and how those stages could have allowed an infestation to go undetected during the Canadian inspection, upon delivery, and until the later discovery. LAC had not timely identified an expert for that purpose because Magistrate Judge Elizabeth Cowan Wright had struck LAC’s late expert disclosure and barred reliance on Kimberly Thielen Cremers as an expert.

The court also found that the Smithsonian article and an affidavit from LAC’s owner and president, Terry Childers, could not supply the missing evidence. The court treated the article as inadmissible hearsay when offered to prove the facts asserted about the moths’ life cycle. It found that portions of the affidavit lacked a demonstrated basis in Childers’s personal knowledge and also conveyed statements that would be hearsay. Separately, the court concluded that LAC had not explained why the Canadian inspection would have failed to detect the moths at one life stage while detecting them at another. The court therefore concluded that no reasonable jury could find, on the evidence presented, that the infestation existed before the trees arrived at Whiting Nursery.

Ruling

The court concluded that LAC could not establish at least one required element of each of its four claims. It therefore granted Defendants’ motions for summary judgment. In the order’s final disposition, the court stated that the motions were “GRANTED” and that the matter was “DISMISSED with prejudice.” The court directed that judgment be entered accordingly.