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Wells Fargo Bank v. Raymond & Associates, LLC

United States District Court, Southern District of Alabama, Southern Division

February 24, 2015

WELLS FARGO BANK, etc., Plaintiff,
v.
RAYMOND & ASSOCIATES, LLC, et al., Defendants.

ORDER

WILLIAM H. STEELE CHIEF UNITED STATES DISTRICT JUDGE

This matter is before the Court on the plaintiff’s motion for summary judgment. (Doc. 22). The plaintiff has filed a brief and evidentiary materials in support of its motion, (Docs. 22-1 to -9), the defendants declined the opportunity to respond, (Doc. 23), and the motion is ripe for resolution. After careful consideration, the Court concludes that the motion is due to be granted in part and denied in part.

Summary judgment should be granted only if “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). The party seeking summary judgment bears “the initial burden to show the district court, by reference to materials on file, that there are no genuine issues of material fact that should be decided at trial.” Clark v. Coats & Clark, Inc., 929 F.2d 604, 608 (11th Cir. 1991). The moving party may meet its burden in either of two ways: (1) by “negating an element of the non-moving party’s claim”; or (2) by “point[ing] to materials on file that demonstrate that the party bearing the burden of proof at trial will not be able to meet that burden.” Id. “Even after Celotex it is never enough simply to state that the non-moving party cannot meet its burden at trial.” Id.; accord Mullins v. Crowell, 228 F.3d 1305, 1313 (11th Cir. 2000); Sammons v. Taylor, 967 F.2d 1533, 1538 (11th Cir. 1992).

“When the moving party has the burden of proof at trial, that party must show affirmatively the absence of a genuine issue of material fact: it must support its motion with credible evidence ... that would entitle it to a directed verdict if not controverted at trial. [citation omitted] In other words, the moving party must show that, on all the essential elements of its case on which it bears the burden of proof, no reasonable jury could find for the nonmoving party.” United States v. Four Parcels of Real Property, 941 F.2d 1428, 1438 (11th Cir. 1991) (en banc) (emphasis in original); accord Fitzpatrick v. City of Atlanta, 2 F.3d 1112, 1115 (11th Cir. 1993).

“If the party moving for summary judgment fails to discharge the initial burden, then the motion must be denied and the court need not consider what, if any, showing the non-movant has made.” Fitzpatrick, 2 F.3d at 1116; accord Mullins, 228 F.3d at 1313; Clark, 929 F.2d at 608.

“If, however, the movant carries the initial summary judgment burden ..., the responsibility then devolves upon the non-movant to show the existence of a genuine issue of material fact.” Fitzpatrick, 2 F.3d at 1116. “If the nonmoving party fails to make ‘a sufficient showing on an essential element of her case with respect to which she has the burden of proof, ’ the moving party is entitled to summary judgment.” Clark, 929 F.2d at 608 (quoting Celotex Corp. v. Catrett, 477 U.S. 317 (1986)) (footnote omitted); see also Fed. R. Civ. P. 56(e)(2) (“If a party fails to properly support an assertion of fact or fails to properly address another party’s assertion of fact as required by Rule 56(c), the court may … consider the fact undisputed for purposes of the motion ….”).

In deciding a motion for summary judgment, “[t]he evidence, and all reasonable inferences, must be viewed in the light most favorable to the nonmovant ….” McCormick v. City of Fort Lauderdale, 333 F.3d 1234, 1243 (11th Cir. 2003).

Because Federal Rule of Civil Procedure 56(a) specifies that summary judgment may be entered only when the record evidence shows that there is no genuine dispute as to any material fact and that the movant is entitled to judgment as a matter of law, “the district court cannot base the entry of summary judgment on the mere fact that the motion was unopposed but, rather, must consider the merits of the motion.” United States v. One Piece of Real Property, 363 F.3d 1099, 1101 (11th Cir. 2004). This rule does not allow a district court to enter summary judgment in favor of the plaintiff merely because the defendants have not opposed the motion for summary judgment. On the other hand, the Court’s review when a defendant does not respond to a motion for summary judgment is less searching than when he does respond. “The district court need not sua sponte review all of the evidentiary materials on file at the time the motion is granted, but must ensure that the motion itself is supported by evidentiary materials. [citation omitted] At the least, the district court must review all of the evidentiary materials submitted in support of the motion for summary judgment.” Id.

The following material facts are uncontroverted:

The plaintiff made a loan to defendant Raymond & Associates, LLC (“R&A”) in the original principal amount of $1, 000, 000.00, evidenced by a note (“the Note”). Defendant R&A Marine, LLC (“R&A Marine”) guaranteed payment of the debt under a continuing guaranty (“the Guaranty”). As of July 2014, the Note was in default due to non-payment, and the plaintiff declared the Note to be in default, accelerated the Note, and demanded payment in full. The default has not been cured. As of November 21, 2014, the outstanding indebtedness under the Note was $1, 019, 784.78. Interest on the unpaid principal balance of $991, 516.74 accrues at the rate of $137.71 per diem.

The plaintiff made a second loan to R&A pursuant to a certain agreement (“the Card Agreement”). R&A Marine guaranteed payment of the debt under the Guaranty. As of July 2014, the Card Agreement was in default, and the plaintiff gave notice of default and demanded payment in full. The default has not been cured. As of November 12, 2014, the outstanding indebtedness under the Card Agreement was $309, 526.65. Interest on the unpaid principal balance accrues at an unspecified rate.

The amended complaint, (Doc. 7), sets out four cause of action: (1) breach of contract against R&A with respect to the Note; (2) breach of contract against R&A with respect to the Card Agreement; (3) breach of guaranty against R&A Marine with respect to both the Note and the Card Agreement; and (4) statutory and common-law detinue against both defendants with respect to certain property (“the Collateral”) in which the plaintiff claims a security interest. The plaintiff seeks summary judgment on all four counts. (Doc. 22 at 1).

The Note is governed by Alabama law. (Doc. 22-2 at 4). “The elements of a breach-of-contract claim are: (1) the existence of a valid contract binding upon the parties in the action, (2) the plaintiff’s own performance, (3) the defendant’s nonperformance, or breach, and (4) damage.” Armstrong Business Services, Inc. v. AmSouth Bank, 817 So.2d 665, 673 (Ala. 2001). The uncontroverted evidence establishes each of these elements.

The Credit Agreement is governed by South Dakota law. (Doc. 22-5 at 5). “The elements that must be met in a breach of contract claim are: (1) an enforceable promise; (2) a breach of the promise: and (3) resulting damages.” Gul v. Center for Family Medicine, 762 N.W.2d 629, 633 ...


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