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Wells Fargo Bank, N.A. v. Tom Roberts Construction Co., Inc.

United States District Court, N.D. Alabama, Eastern Division

February 12, 2015

WELLS FARGO BANK, N.A., Plaintiff.


HARWELL G. DAVIS, III, Magistrate Judge.

This matter is before the undersigned U.S. Magistrate Judge based on the consent of the parties pursuant to 28 U.S.C. § 636(c). See Doc. 54. Plaintiff, Wells Fargo Bank, N.A. (Wells Fargo), has filed a motion to strike the jury demand of defendants, Tom Roberts Construction Company, Inc. (TRCC) and Thomas Scott Roberts, III. (Doc. 23). Wells Fargo also has filed a motion for summary judgment. (Doc. 35). Defendants have had the opportunity to respond to each of these motions and they are now ready for disposition.


"The court shall grant summary judgment if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed.R.Civ.P. 56(a). Plaintiff, as the party seeking summary judgment, bears the initial responsibility of informing the district court of the basis for its motion, and identifying those portions of the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, which it believes demonstrates the absence of a genuine issue of material fact. Clark v. Coats & Clark, Inc., 929 F.2d 604, 608 (11th Cir. 1991) (quoting Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986)). A genuine issue of material fact is shown when the non-moving parties produce evidence so that a reasonable factfinder could return a verdict in their favor. Greenberg v. BellSouth Telecomms., Inc., 498 F.3d 1258, 1263 (11th Cir. 2007). If the non-moving parties fail to make a sufficient showing on an essential element of their case with respect to which they have the burden of proof, the moving party is entitled to summary judgment. Celotex, 477 U.S. at 323. In reviewing whether the non-moving parties have met their burden, the court must stop short of weighing the evidence and making credibility determinations of the truth of the matter; the evidence of the non-movants is to be believed, and all justifiable inferences are to be drawn in their favor. Tipton v. Bergrohr GMBH-Siegen, 965 F.2d 994, 998-99 (11th Cir. 1992) (internal citations and quotations omitted). However, speculation or conjecture cannot create a genuine issue of material fact. Cordoba v. Dillard's, Inc., 419 F.3d 1169, 1181 (11th Cir. 2005). A "mere scintilla of evidence" in support of the non-moving party also cannot overcome a motion for summary judgment. Young v. City of Palm Bay, 358 F.3d 859, 860 (11th Cir. 2004).


The material facts giving rise to this suit are not in dispute. Wells Fargo is the successor-by-merger to Wachovia Bank, N.A. (Wachovia), and the owner and holder of all loan documents described and referenced in the complaint by Wells Fargo. The Court took judicial notice of both the merger between Wells Fargo and Wachovia and its legal effect. ( See Doc. 46). The Court took notice that Wachovia merged with Wells Fargo, as reflected in the Certificate of Merger and letter from the Comptroller of the Currency attached as Exhibit A to plaintiff's request. ( See Docs. 45, Ex. A & 46). The Court further took notice that, as a result of the merger between Wells Fargo and Wachovia, Wells Fargo assumed all of the rights and obligations of Wachovia. (Doc. 46 at 3). Furthermore, under Alabama law, "all rights, immunities, and franchises of the merged entities, of a public as well as a private nature, and all debts and obligations due the merged entities, are taken and deemed to be transferred and vested in the surviving or resulting entity without the necessity of any deed or other instrument of conveyance to the surviving or resulting entity...." Ala. Code § 10A-1-8.02(i)(2). Thus, there is no genuine issue of material fact as to Wells Fargo's entitlement to enforce the loans made by Wachovia in this case. SE Prop. Holdings, LLC v. Sandy Creek II, LLC, 954 F.Supp.2d 1322, 1348 (S.D.Ala. 2013).

On or about May 1, 2006, Wells Fargo[1] made a loan, characterized as a line of credit, to TRCC in the amount of $250, 000.00 (the "Loan"). The Loan is evidenced by a Promissory Note (the "Note") dated May 1, 2006, made by TRCC and signed by Mr. Roberts, payable to Wachovia (now Wells Fargo) in the amount of $250, 000.00. ( See Doc. 35 at Ex. 1). The Note is a demand note and payable in full, including all principal and accrued interest, upon demand. ( See id. ).

In connection with this loan, Mr. Roberts executed an Unconditional Guaranty (Guaranty Agreement) dated May 1, 2006, in favor of Wells Fargo. (Id. at Ex. 3). Under the terms of the Guaranty Agreement, Mr. Roberts guaranteed the payment and performance of all of TRCC's obligations under the Loan. (Id. ). That document also states that default events include, among others, "failure of timely payment or performance of the Guaranteed Obligations or a default under any Loan Document." (Id. at 3). According to the affidavit of Andre Taylor, Assistant Vice President and Loan Recovery Unit Officer for Wells Fargo, the underlying loan is in default due to, among other things, defendants' failure to pay all the amounts of outstanding principal and accrued interest when due under the terms of the note. (Doc. 35, Ex. A, Taylor Aff., ¶ 10). This is verified by Wells Fargo bank records submitted by plaintiff. ( See Doc. 35 at Ex. 2).

By letter dated December 4, 2009, Wells Fargo informed defendants that the Loan was in default and demanded immediate payment of principal and interest owned under the Note. (Doc. 35, Ex. 4, First Demand Letter). By letter dated July 3, 2013, Wells Fargo again informed defendants that the Loan was in default and again demanded immediate payment of all amounts due. (Id. at Ex. 5, Second Demand Letter). According to Andre Taylor, defendants failed to tender the amounts due and payable under the terms of the Loan. (Doc. 35, Ex. A, Taylor Aff., ¶ 13). As of June 6, 2014, the outstanding indebtedness due under the Note was $295, 828.67, consisting of $248, 498.42 in outstanding and unpaid principal, $45, 039.96 in accrued and unpaid interest, and late charges in the amount of $2, 290.29. Interest accrues under the Note at a per diem rate of $25.89. ( Id., ¶ 14).

The terms of the Promissory Note state, in pertinent part, as follows:

Borrower promises to pay to the order of Bank, in lawful money of the United States of America, at its office indicated above or wherever else Bank may specify, the sum of Two Hundred Fifty Thousand and No/100 Dollars ($250, 000.00) or such sum as may be advanced and outstanding from time to time, with interest on the unpaid principal balance at the rate and on the terms provided in this Promissory Note (including all renewals, extensions or modifications hereon, the "Note").

(Doc. 35, Ex. 1, Promissory Note, at 1).

The Note sets the interest rate at the bank's prime rate plus.5%. It further sets a rate of interest, in the event of default, at the prime rate plus 3%. In addition, it provides for payment of a late charge equal to 5% of each payment past due for 10 or more days and for the payment of reasonable attorneys' fees and ...

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