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U.S. Bank Trust N.A. v. Berube

United States District Court, D. Maine

January 9, 2017

U.S. BANK TRUST, N.A., AS TRUSTEE FOR LSF9 MASTER PARTICIPATION TRUST, Plaintiff,
v.
MARC R. BERUBE and DONNA G. BERUBE, Defendants. JAND, INC., d/b/a/ SERVPRO OF LEWISTON-AUBURN, ST. MARY'S REGIONAL MEDICAL CENTER, MAINE REVENUE SERVICES Parties-In-Interest.

          ORDER ON PLAINTIFF'S MOTION FOR SUMMARY JUDGMENT ON DEFENDANT'S COUNTERCLAIM

          George Z. Singal United States District Judge.

         Before the Court is Plaintiff U.S. Bank Trust, N.A., as Trustee for LSF9 Master Participation Trust's Motion for Summary Judgment on Defendant Marc R. Berube's Counterclaim (ECF No. 25). For the reasons briefly explained herein, the Court GRANTS Plaintiff's Motion.[1]

         I. LEGAL STANDARD

         Generally, a party is entitled to summary judgment if, on the record before the Court, it appears “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). “[T]he mere existence of some alleged factual dispute between the parties will not defeat an otherwise properly supported motion for summary judgment; the requirement is that there be no genuine issue of material fact.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247-48 (1986). An issue is “genuine” if “the evidence is such that a reasonable jury could return a verdict for the nonmoving party.” Id. at 248. A “material fact” is one that has “the potential to affect the outcome of the suit under the applicable law.” Nereida-Gonzalez v. Tirado-Delgado, 990 F.2d 701, 703 (1st Cir. 1993).

         The party moving for summary judgment must demonstrate an absence of evidence to support the nonmoving party's case. Celotex Corp. v. Catrett, 477 U.S. 317, 325 (1986). In determining whether this burden is met, the Court must view the record in the light most favorable to the nonmoving party and give that party the benefit of all reasonable inferences in its favor. Santoni v. Potter, 369 F.3d 594, 598 (1st Cir. 2004).

         Once the moving party has made this preliminary showing, the nonmoving party must “produce specific facts, in suitable evidentiary form, to establish the presence of a trialworthy issue.” Triangle Trading Co., Inc. v. Robroy Indus., Inc., 200 F.3d 1, 2 (1st Cir. 1999) (internal quotation marks and punctuation omitted); see also Fed.R.Civ.P. 56(e). “Mere allegations, or conjecture unsupported in the record, are insufficient.” Barros-Villahermosa v. United States, 642 F.3d 56, 58 (1st Cir. 2011) (quoting Rivera-Marcano v. Normeat Royal Dane Quality A/S, 998 F.2d 34, 37 (1st Cir. 1993)); see also Wilson v. Moulison N. Corp., 639 F.3d 1, 6 (1st Cir. 2011) (“A properly supported summary judgment motion cannot be defeated by conclusory allegations, improbable inferences, periphrastic circumlocutions, or rank speculation.”). “As to any essential factual element of its claim on which the nonmovant would bear the burden of proof at trial, its failure to come forward with sufficient evidence to generate a trialworthy issue warrants summary judgment for the moving party.” In re Ralar Distribs., Inc., 4 F.3d 62, 67 (1st Cir. 1993).

         II. FACTUAL BACKGROUND

         The following facts, taken from the summary judgment record before the Court, are undisputed.[2] On August 25, 2008, Marc and Donna Berube executed a Note and Mortgage in favor of Countrywide Bank, FSB. The Mortgage encumbered property in Minot, Maine (hereinafter, “the Property.”) On August 29, 2014, Marc filed for Chapter 13 Bankruptcy, which triggered an automatic stay pursuant to 11 U.S.C. § 362(a). On October 23, 2015, Plaintiff U.S. Bank Trust, N.A., as Trustee for LSF9 Master Participation Trust (“U.S. Bank”), a successor-in-interest to Countrywide Bank, filed a motion for relief from the automatic stay. On December 15, 2015, the Bankruptcy Court vacated the automatic stay “as to [U.S. Bank]'s interests in the Property to allow [U.S. Bank]'s enforcement of its rights in, and remedies in and to, including but not limited to foreclosure of the mortgage lien on the Property; negotiating a settlement or by entering into a loan workout with [Marc Berube].” (Ex. 3 to Pl.'s Statement of Material Facts (ECF No. 26-3), Page ID # 294.) The Bankruptcy Court further ordered “that [U.S. Bank] shall promptly report and turn over to the case trustee any surplus monies realized by any sale of the Property.” (Id.)

         On August 4, 2016, U.S. Bank filed a Complaint against Marc Berube, Donna Berube, and parties-in-interest JAND, Inc., d/b/a Servpro of Lewiston-Auburn, St. Mary's Regional Medical Center, and Maine Revenue Services, to foreclose on the Property. The Complaint alleged, inter alia, that the Berubes had defaulted on the Note and that the Property was subject to foreclosure. The Complaint specifically stated that Marc Berube's “liability is subject to, and limited by his Bankruptcy Docke[t] No.: 14-20704.” (Compl. (ECF No. 1), Page ID # 5, ¶ 20.) In the Prayer for Relief, U.S. Bank requested “subject to the bankruptcy of Marc R. Berube at Docket No.: 14-20704” that the Court, in part, “issue a money judgment against the Defendants . . . in the amount of . . . ($243, 654.05) dollars, the total debt ow[]ed under the Note plus interest and costs, including attorney's fees and costs.” (Id., Page ID #s 12-13.)

         On August 19, 2016, counsel for Marc Berube emailed counsel for U.S. Bank expressing displeasure with the fact that U.S. Bank had filed a foreclosure action in federal court and stating:

The demands for a money judgment plus costs and fees . . . well, I am ccing the Trustee because the claims for violations of the automatic stay belong, in part, to the bankruptcy estate. I understand the ease in using form complaints. But that can get clients into trouble.

(Ex. 4 to Pl.'s Statement of Material Facts (ECF No. 26-4), Page ID # 297.) On August 24, 2016, counsel for U.S. Bank responded with an email stating, in part:

It is not my intention to seek any sort of personal money damages against your client and I would refer you to Paragraph 20 of our complaint and the initial portion of the prayer for relief which both reference your client's bankruptcy. I am happy to make any reasonable changes to the complaint to make that clearer. . . . Thank you for your time and please let me know if there are specific changes you would like to see to make it clearer that there is no personal liability on the part of Marc Berube.

(Id., Page ID # 298.) On August 26, 2016, Marc Berube filed his Answer to U.S. Bank's Complaint, which included a Counterclaim alleging that U.S. Bank had violated the automatic stay. Notably, the Answer also admitted the allegation in paragraph 20 of the Complaint that Marc Berube's “liability is subject to, and limited by his Bankruptcy Docke[t] No.: 14-20704.” (Answer (ECF No. 8), Page ID # 123.) ...


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