In re: AFFORDABLE PATIOS & SUNROOMS, DBA Reno Patio and Fireplaces, DBA Reno Patio v. Legacy Fire Services, LLC

NOT FOR PUBLICATION
UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT
In re: AFFORDABLE PATIOS &
SUNROOMS, DBA Reno Patio and
Fireplaces, DBA Reno Patio*,
Debtor,
------------------------------
CHRISTOPHER P. BURKE, Chapter 7
Trustee,
Appellant,
v.
LEGACY FIRE SERVICES, LLC,
Appellee.
No. 22-60059
BAP No. 22-1063
MEMORANDUM*
Appeal from the Ninth Circuit
Bankruptcy Appellate Panel
Faris, Taylor, and Brand, Bankruptcy Judges, Presiding
Submitted March 7, 2024**
Las Vegas, Nevada
Before: M. SMITH, BENNETT, and COLLINS, Circuit Judges.
* This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
** The panel unanimously concludes this case is suitable for decision
without oral argument. See Fed. R. App. P. 34(a)(2).
FILED
APR 1 2024
MOLLY C. DWYER, CLERK
U.S. COURT OF APPEALS

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Christopher T. Burke, the Chapter 7 Trustee (the Trustee) appointed to
administer the estate of Affordable Patios & Sunrooms d/b/a Reno Patio and
Fireplaces, appeals from an order of the Bankruptcy Appellate Panel (BAP)
affirming the bankruptcy court’s order granting summary judgment to Legacy Fire
Services, LLC (Legacy). We have jurisdiction pursuant to 28 U.S.C. § 158(d). We
review de novo the bankruptcy court’s grant of summary judgment. In re Slatkin,
525 F.3d 805, 810 (9th Cir. 2008). Because the parties are familiar with the facts,
we do not recount them except as necessary to provide context. We affirm.
In granting summary judgment to Legacy, the bankruptcy court held that there
were numerous unsettled material terms that precluded the formation of a real estate
contract between the Trustee and Legacy, such that the Trustee’s claim for turnover
of a debt pursuant to 11 U.S.C. § 542(b) against Legacy for breach of contract failed
as a matter of law. On appeal, the Trustee argues that the bankruptcy court erred
because it disregarded genuine disputes of fact over whether a contract ever formed.
Nevada law is clear that “preliminary negotiations do not constitute a binding
contract unless the parties have agreed to all material terms.” May v. Anderson, 119
P.3d 1254, 1257 (Nev. 2005). “A valid contract cannot exist when material terms
are lacking or are insufficiently certain and definite.” Id. Material terms often
include “subject matter, price, payment terms, quantity, and quality.” In re Est. of
Kern, 823 P.2d 275, 277 (Nev. 1991). Viewing the evidence in the light most

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favorable to the Trustee, see T.W. Elec. Serv., Inc. v. Pac. Elec. Contractors Ass’n,
809 F.2d 626, 630–31 (9th Cir. 1987), we conclude that, because the parties never
reached agreement as to the “quality” or “quantity” of the property, no contract ever
formed between the Trustee and Legacy as a matter of law.
In its “formal offer” letter to the Trustee, Legacy expressed interest in
purchasing “the three buildings and associated land” at 910 Glendale Avenue and
stated that the Trustee should contact Legacy “to discuss possible contingencies and
further terms of an agreement.” The latter phrase, on its face, refutes the Trustee’s
contention below that “Legacy never advised [the Trustee] that it wanted to negotiate
any other specific conditions.” In particular, nothing in Legacy’s letter resolved the
crucial issue of what the quality of the property had to be in connection with the sale.
The undisputed evidence shows that, during a visit to the property, representatives
from Legacy were unable to access at least one of the three buildings on the property,
which was occupied by squatters. And as the Trustee put it in his moving papers
below, the property was also littered with a “great deal of debris” that presented “a
potential fire hazard.” On this record, no reasonable trier of fact could conclude that
the parties had come to agreement as to what the condition of the property had to be.
The only reasonable reading of Legacy’s letter is that this critical term would be the
subject of further discussions before a sufficient agreement would be reached.
Moreover, the Trustee acknowledged that, for Legacy, a crucial aspect of the

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sale was that all three buildings be included. Nonetheless, the Trustee’s purported
written acceptance of Legacy’s “formal offer” confusingly agreed to sell “the
commercial building”—singular—“at 910 Glendale Ave.” Indeed, when asked at
his deposition to identify issues that might be among the “further terms of
agreement” that would have to be clarified, the Trustee noted that Legacy “wanted
to make sure that [the sale] included the three buildings,” with no liens. On this
record, the only reasonable conclusion is that the parties’ exchange of letters did not
suffice to resolve the crucial question of “quantity.”
Because Nevada law is clear that a contract does not come into existence at
all “when material terms are lacking or are insufficiently certain and definite,” May,
119 P.3d at 1257, the bankruptcy court properly concluded that no contract was
formed here.
AFFIRMED.

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