UNITED STATES BANKRUPTCY COURT

EASTERN DISTRICT OF KENTUCKY

FRANKFORT DIVISION

IN RE:

MARION GAYLE MILLER

EVELYN L. MILLER CASE NO. 92-30209

DEBTORS

ENGLISH PAVING COMPANY PLAINTIFF

VS: OPINION AND ORDER ADV. NO. 95-3016

MARION GAYLE MILLER,

EVELYN L. MILLER, REPUBLIC

BANK & TRUST COMPANY AND

GEORGETOWN BANK & TRUST

COMPANY DEFENDANTS

This matter is before the Court upon the Motion for Summary Judgment filed herein on November 6, 1995 by the plaintiff, English Paving Company, seeking summary judgment against Georgetown Bank & Trust Company and Republic Savings Bank in the within matter. The matter was heard by the Court on December 18, 1995 and taken under submission by the Court.

The issues before the Court involve application of the parol evidence rule and plaintiff''s argument that the debtor's action in selling the equipment violated the confirmed Chapter 13 plan then in effect.

The Court must apply the law of the Commonwealth of Kentucky with regard to questions of parol evidence. In re Potts, 724 F.2d 47 (6th Cir. 1984).

It is the claim of the plaintiff that the written contract between the parties in this matter, dated January 3, 1994 and on the letterhead of H. G. Mays Corporation, which is attached as Exhibit 2 to plaintiff's Motion for Summary Judgment and Memorandum in Support Thereof, is conclusive as to the fact that the within transaction was a sale of the equipment in question. Plaintiff, in effect, contends that no evidence could be offered in parol which could vary the terms of the agreement and the Court must interpret it as a sale of the equipment involved. Clearly, the document is unequivocal that there was a sale of the equipment involved.

The defendants, Republic and Georgetown Bank, cite Potts v. Draper, 864 S.W.2d 896 (Ky. 1993) in support of the proposition that since they were not parties to the agreement, they may introduce extrinsic evidence with regard to the agreement. In fact, KRS 355.2-203, as cited in Potts v. Draper, specially provides, at subsection (a) that such unambiguous agreement may be supplemented or explained by course of performance of the parties. The defendants have tendered, as Exhibit 1 to their Response herein, the Affidavit of Harold G. Mays, apparently the principal of H. G. Mays Corporation. The contents of that Affidavit would tend in some regards to reflect course of performance of the parties after execution of the agreement. For this reason, it is inappropriate to grant the motion for summary judgment sought by the plaintiff since Kentucky law specifically allows for supplementation by way of course of performance even where that supplementation appears to contradict the terms of the contract directly. Whether or not the Court will believe such testimony must await the evidence to be presented in the matter.

Plaintiff's argument that the sale of the equipment violated the terms of the plan and Bankruptcy Code, if taken as true, still do not warrant the conclusion by the Court that the plaintiff is entitled to judgment as a matter of law.

For the above reasons, the motion of the plaintiff herein for summary judgment be, and the same hereby is, OVERRULED.

Dated this ______ day of February, 1996.

BY THE COURT

_________________________________

JUDGE

COPIES TO:

William C. Ayer Jr., Esq.

William T. Shier, Esq.

Lucinda Masterton, Esq.

W. Thomas Bunch, Esq.