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ARA Incorporated v. City of Glendale

360 F. Supp. 3d 957 (2019)

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ARA Incorporated v. City of Glendale

United States District Court for the District of Arizona
360 F. Supp. 3d 957 (2019)

RW

Facts

A couple owned two similarly named personnel-staffing firms in Texas and Arizona. In 2015, the City of Glendale, Arizona (defendant) signed a contract with the couple under circumstances making it unclear whether the Texas firm or the Arizona firm was Glendale’s intended contract partner. In 2016, the Texas firm defaulted on a loan from ARA Incorporated (plaintiff). ARA notified Glendale that the defaulted loan was secured by the Texas firm’s business assets, that ARA was the loan’s secured creditor, and that Glendale should send all future payments on the 2015 contract directly to ARA. Glendale refused payment on the grounds that its contract partner was not the Texas firm but the Arizona firm. ARA sued. Both parties moved for summary judgment. Faced with voluminous conflicting evidence as to the true identity of Glendale’s contract partner, the federal district court referred that matter for a jury’s determination. The court then took up Glendale’s argument that, regardless of the contract partner’s identity, Glendale was entitled to summary judgment because ARA failed to comply with the assignment-notice requirements of Uniform Commercial Code (UCC) § 9-406.

Rule of Law

Issue

Holding and Reasoning (Lanza, J.)

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