Bankers Trust Co CA v. Boydell ( 2002 )

IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT
____________________
No. 01-31125
Summary Calendar
____________________
BANKERS TRUST COMPANY OF CALIFORNIA, NA, as trustee
Plaintiff - Appellee
v.
EARL M J BOYDELL, JR; DEONNE DUBARRY
Defendants - Appellants
_________________________________________________________________
Appeals from the United States District Court
for the Eastern District of Louisiana
USDC No. 00-CV-3403-F
_________________________________________________________________
July 29, 2002
Before KING, Chief Judge, and JOLLY and DeMOSS, Circuit Judges.
PER CURIAM:*
Defendants-Appellants, Earl M.J. Boydell, Jr. and Deonne
DuBarry, appeal the district court’s grant of summary judgment in
favor of Plaintiff-Appellee, Bankers Trust Company of California
(“Bankers Trust”), on Bankers Trust’s action to enforce Boydell
*
Pursuant to 5TH CIR. R. 47.5, the court has determined
that this opinion should not be published and is not precedent
except under the limited circumstances set forth in 5TH CIR. R.
47.5.4.
and DuBarry’s payment obligations under a promissory note and to
obtain a declaration of Bankers Trust’s rights under two
agreements created to secure repayment on that promissory note.
For the following reasons, we AFFIRM the district court’s order
granting summary judgment in favor of Bankers Trust.
I. BACKGROUND
This diversity case is based on a set of three agreements
executed by Boydell and DuBarry in 1984 to obtain a $280,000 loan
from Pelican Homestead Savings and Association (“Pelican”): (1) a
promissory note (the “Note”) executed in favor of Pelican and
paraphed ne varietur (i.e., notarized in identification with) an
act of mortgage securing the payment obligations under the Note,
(2) the act of mortgage (the “Mortgage”), which secured the Note
by encumbering certain property located Orleans Parish, Louisiana
(the “Orleans Parish property”), and (3) an assignment of the
leases and rents from the Orleans Parish property “made and
delivered as additional security for the payment of the Note”
(the “Assignment”). Pelican subsequently declared bankruptcy,
and on November 17, 1992, Pelican’s receiver, the Resolution
Trust Corporation, endorsed the Note and assigned the Mortgage to
Bank of America National Trust and Savings Association (“Bank of
America”) as trustee for the benefit of the investors in a
Resolution Trust Corporation loan pool. Bankers Trust succeeded
Bank of America as trustee.
2
On May 1, 2000, Boydell and DuBarry defaulted on their
payment obligations under the Note and Mortgage. After making
two unsuccessful amicable demands for payment, the second of
which included a notice of acceleration, Bankers Trust filed suit
in the district court on November 15, 2000, asserting that, as
holder of the Note, Bankers Trust was entitled to collect the
full amount of Boydell and DuBarry’s payment obligations under
the Note and Mortgage because of their continued default.1 In
addition to seeking judgment against Boydell and Dubarry
(individually and in solido) for the amounts owing under the
Note, Bankers Trust requested that it be declared (1) “the holder
of a valid and sustaining first lien, privilege and mortgage” on
the Orleans Parish property and (2) “the assignee and owner of
the leases, rents, and future leases received or derived from the
[Orleans Parish property].”
In support of its claim, Bankers Trust submitted copies of
the Note, the Mortgage, and the Assignment, as well as
documentation of Bankers Trust’s status as holder of the Note and
Mortgage and of its entitlement to the leases and rents from the
Orleans Parish property under the Assignment. Boydell responded
to Bankers Trust’s complaint with general denials and an
allegation that he was improperly charged late fees that were
1
In its first amended complaint, filed on March 20, 2001,
Bankers Trust named Earl M.J. Boydell, Jr. as DuBarry’s co-
defendant instead of Earl M.J. Boydell.
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never credited in the loan payment record. DuBarry, who filed a
separate answer to the complaint, maintained that Bankers Trust
was not entitled to judgment against her for payment on the Note
because she sold her interest in the Orleans Parish property to
Boydell.
On August 16, 2001, Bankers Trust filed a motion for summary
judgment. In addition to the documents submitted with its
complaint, Bankers Trust produced copies of the two demand
letters mailed to Boydell and DuBarry, the loan payment record, a
Louisiana mortgage certificate indicating that the Mortgage was a
validly recorded first lien and encumbrance on the Orleans Parish
property, and affidavits supporting Bankers Trust’s assertions
that it was holder of the Note and Mortgage and that Boydell and
DuBarry had defaulted on their payment obligations. In response,
Boydell reiterated his general denials of Bankers Trust’s
allegations and submitted a copy of the loan payment record and
copies of two checks for payments that he alleged were never
credited to his loan account. On the day before the hearing on
Bankers Trust’s summary judgment motion, Boydell also submitted
his own affidavit claiming that the signature of his name on the
Note was not genuine. DuBarry did not file a response to Bankers
Trust’s summary judgment motion.
Finding that neither Boydell nor DuBarry had submitted
evidence creating a genuine issue of material fact as to the
genuineness of the Note, the district court concluded that
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Bankers Trust was entitled to judgment as a matter of law.
Boydell and DuBarry timely appealed the district court’s grant of
summary judgment in favor of Bankers Trust.
II. SUMMARY JUDGMENT STANDARD OF REVIEW
We review a district court’s grant of summary judgment de
novo, applying the same Rule 56 standard as the district court.
Blow v. City of San Antonio, 236 F.3d 293, 296 (5th Cir. 2001).
Summary judgment is proper “if the pleadings, depositions,
answers to interrogatories, and admissions on file, together with
the affidavits, if any, show that there is no genuine issue as to
any material fact and that the moving party is entitled to a
judgment as a matter of law.” FED. R. CIV. P. 56(c). Because
“[c]redibility determinations, the weighing of the evidence, and
the drawing of legitimate inferences from the facts are jury
functions, not those of a judge,” Anderson v. Liberty Lobby,
Inc., 477 U.S. 242, 255 (1986), “[d]oubts are to be resolved in
favor of the nonmoving party, and any reasonable inferences are
to be drawn in favor of that party,” Evans v. City of Bishop, 238
F.3d 586, 589 (5th Cir. 2000).
If the moving party shows that there is no genuine issue of
material fact, then the burden shifts to the nonmoving party, who
“may not rest upon the mere allegations or denials of the
[nonmoving] party’s pleading,” but rather “must set forth
specific facts showing that there is a genuine issue for trial.”
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FED. R. CIV. P. 56(e). After the nonmoving party has been given
an opportunity to raise a genuine factual issue, if no reasonable
juror could find for that party, summary judgment is proper. See
Anderson, 477 U.S. at 252.
III. ENFORCEMENT OF THE PROMISSORY NOTE
Under Louisiana law, “[w]hen signatures [on a promissory
note] are admitted or established, production of the instrument
entitles a holder to recover on it unless the defendant
establishes a defense.” Am. Bank v. Saxena, 553 So. 2d 836, 842
(La. 1989); see also LA. REV. STAT. ANN. §§ 10:3-301, 10:3-308(b)
(West 1993). In light of this clear-cut and simple legal scheme,
this court has recognized that “[s]uits to enforce promissory
notes are especially appropriate for disposition by summary
judgment.” Resolution Trust Corp. v. Marshall, 939 F.2d 274, 276
(5th Cir. 1991).
In support of its summary judgment motion, Bankers Trust
produced a copy of the Note bearing Boydell’s and DuBarry’s
signatures as well as documents and affidavits showing that
Bankers Trust is the holder of the Note and that Boydell and
DuBarry defaulted on their payment obligations. Louisiana law
provides that “[i]n an action with respect to an instrument, the
authenticity of, and authority to make, each signature on the
instrument is admitted unless specifically denied in the
pleadings.” LA. REV. STAT. ANN. § 10:3-308(a). Accordingly, as
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neither Boydell nor DuBarry denied the authenticity of their
signatures on the Note in their answers to Bankers Trust’s
complaint, the authenticity of their signatures is admitted.2
Bankers Trust has thus satisfied its summary judgment burden with
the documents it produced, and the burden shifts to Boydell and
DuBarry to establish the existence of a genuine issue of material
fact precluding summary judgment. See Premier Bank, Nat’l Ass’n
v. Percomex, Inc., 92-243 (La. App. 3 Cir. 3/3/93), 615 So. 2d
41, 43 (“Once the plaintiff, the holder of a promissory note,
proves the maker’s signature, or the maker admits it, the holder
has made out his case by mere production of the note and is
entitled to recover in the absence of any further evidence.”).
DuBarry did not submit a response to Bankers Trust’s summary
judgment motion. In her answer to the complaint, she either
generally denied “due to lack of information” or admitted all of
Bankers Trust’s allegations. Thus, DuBarry did not specifically
contest the authenticity of her signature on the Note, the status
of Bankers Trust as the holder of the Note, or the fact that the
2
On the day before a hearing on Bankers Trust’s summary
judgment motion was scheduled to take place, Boydell filed an
affidavit with the district court in which he suggested that the
signature of his name on the Note was inauthentic. Although this
claim is material to Bankers Trust’s action to enforce the Note,
we agree with the district court that Boydell’s challenge to the
authenticity of the signature is not sufficient to raise a
genuine factual issue, given that he made payments on the Note
for several years before the default and did not question the
genuineness of the signature until almost ten months after
Bankers Trust initiated the instant action.
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Note was in default. The only specific fact that she asserted ——
that she sold her interest in the Orleans Parish property to
Boydell —— is immaterial to Bankers Trust’s action to enforce the
Note.3 A transfer of DuBarry’s interest in the property securing
her payment obligations under the Note does not relieve her of
those obligations. See Solomon v. Copping, 112 So. 2d 749, 751
(La. Ct. App. 1959) (“[T]he assumption [of a mortgage obligation]
by the new purchaser [of the mortgaged property] in no way
relieves the original mortgagor of the mortgage obligation.”).
In his response to Bankers Trust’s summary judgment motion,
Boydell argued that he was improperly charged late fees and that
he made two payments that were never credited to his account.
Neither of these claims affect Bankers Trust’s entitlement to
collect on the Note, as Boydell did not assert in his summary
judgment response that he would not have been in default of his
loan obligations if the late fees had not been charged or if the
two payments had been credited. Read liberally, Boydell’s and
DuBarry’s briefs on appeal (which are essentially the same
document) suggest that the allegedly improper late fees and
uncredited payments had some sort of causal connection to the
default. Boydell and DuBarry claim that they “have a right to a
trial on the merits in order to prove that [Bankers Trust] was,
and is, the factor which has caused the mortgage account . . . to
3
As the district court pointed out, DuBarry did not
produce any documentation in support of this claim.
8
reflect an incorrect balance, excessive late fees . . . and
numerous other bookkeeping and legal errors.” However, Boydell
and DuBarry cannot defeat summary judgment with such conclusory
assertions. The only evidence that Boydell submitted to the
district court —— i.e., copies of the two checks for the
allegedly uncredited payments and a copy of the payment record ——
actually undermines his claim that the payments were not credited
to the loan account because, as the district court noted, the
payment record reflects both payments. Nor are we persuaded by
Boydell and DuBarry’s contention that they would have been able
to demonstrate the inaccuracy of their loan payment record if
they had “been given an opportunity to complete discovery and to
have an accountant review the [record].” While summary judgment
is not appropriate unless the nonmoving party has been provided
adequate time for discovery, Celotex Corp. v. Catrett, 477 U.S.
317, 322 (1986), the nonmoving party “must file a motion and
non-evidentiary affidavits pursuant to [Rule] 56(f), explaining
why it cannot oppose the summary judgment motion on the merits,”
in order “[t]o preserve a complaint of inadequate opportunity to
conduct discovery,” Robbins v. Amoco Prod. Co., 952 F.2d 901, 907
(5th Cir. 1992). Because Boydell and Dubarry did not file any
such motion in the district court, reversal is warranted only if
they demonstrate that their substantial rights were affected as a
result of the allegedly inadequate discovery. See FED. R. CIV. P.
61. In their briefs to this court, they do not even attempt to
9
justify their failure to engage in any discovery during the ten
months between Bankers Trust’s filing of its complaint and the
district court’s granting of summary judgment. Boydell and
DuBarry are not entitled to reversal based on their conclusory
assertion that they were not permitted sufficient time for
discovery in the district court. See Robbins, 952 F.2d at 907.
Because Boydell and DuBarry rested on general denials and
unsupported, largely immaterial assertions, the district court
correctly determined that there was no genuine issue of material
fact precluding summary judgment in favor of Bankers Trust on its
claim to enforce the Note.4
IV. DECLARATION OF RIGHTS UNDER THE MORTGAGE AND THE ASSIGNMENT
OF LEASES AND RENTS
Under Louisiana law, “[a]n authentic act [of mortgage]
constitutes full proof of the agreement it contains, as against
the parties, their heirs, and successors by universal or
particular title.” LA. CIV. CODE ANN. art. 1835 (West 1987).
Bankers Trust produced copies of both the Mortgage and the
4
In his response to Bankers Trust’s summary judgment
motion, Boydell also suggested that the transfer of the Note and
the Mortgage was somehow improper. Specifically, he asserted
that he “ha[d] absolutely no evidence of any type proving that a
proper transference of the balance of the mortgage was accurately
performed.” However, given that Bankers Trust did produce such
evidence —— specifically, documentation of the transfer through
which it obtained the Note and Mortgage and supporting affidavits
—— Boydell was required to produce some type of evidence
indicating that the transfer was improper in order to create a
genuine factual issue sufficient to preclude summary judgment.
Boydell failed to produce any such evidence.
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Assignment and a supporting affidavit attesting that they were
true copies of the original documents. As noted above, Bankers
Trust also produced documentation establishing that it is the
holder of the Mortgage, that the Mortgage is a validly recorded
first lien and encumbrance on the Orleans Parish property, and
that Bankers Trust is entitled under the Assignment to the
leases, rents, and future leases derived from the Orleans Parish
property. Neither Boydell nor DuBarry presented more than
general denials in response to Bankers Trust’s claims that it is
the valid holder of the Mortgage as a validly recorded first lien
and encumbrance on the Orleans Parish property and that it is the
owner of the leases, rents, and future leases of the Orleans
Parish property under the Assignment. Accordingly, the district
also correctly determined that Bankers Trust is entitled to
summary judgment on its claims for declaratory relief regarding
its rights under the Mortgage and Assignment.
V. CONCLUSION
For the foregoing reasons, we AFFIRM the district court’s
order granting summary judgment in favor of Bankers Trust.
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