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Infinity Real Estate LLC v. Deutsche Bank National Trust Co.

United States District Court, D. Maine

April 29, 2019

INFINITY REAL ESTATE LLC, Plaintiff,
v.
DEUTSCHE BANK NATIONAL TRUST COMPANY, Defendant

          ORDER ON CROSS-MOTIONS FOR SUMMARY JUDGMENT

          Lance E. Walker U.S. District Judge

         Maine mortgage foreclosure procedures provide that “[t]he mortgagee shall sell the premises to the highest bidder at the public sale and deliver a deed of that sale … to the purchaser.” 14 M.R.S. § 6323. Plaintiff Infinity Real Estate LLC was the second highest bidder at the public sale for certain Kittery, Maine realty. Only the defaulting mortgagor outbid Plaintiff. When the defaulting mortgagor failed to close the sale, Defendant Deutsche Bank National Trust Company offered to sell the property to Plaintiff and Plaintiff accepted. Although Plaintiff and Defendant executed a Purchase and Sale Agreement, Defendant later reneged. Plaintiff contends it is entitled to specific performance of the agreement, and Defendant maintains it cannot sell the property to Plaintiff because a sale to Plaintiff would violate Maine law.

         The matter is before me on cross-motions for summary judgment. Defendant also requests that I strike a summary judgment affidavit filed by Plaintiff in support of Plaintiff's summary judgment reply memorandum.

         SUMMARY JUDGMENT FACTS

         The parties submitted their motions on a stipulated record, which recites the following facts. On April 19, 2012, Deutsche Bank obtained a judgment of foreclosure and sale against Fancesco Rotondo and realty located at 1 Tudor Drive, Kittery, Maine, 03904.

         On January 17, 2017, Deutsche Bank held a foreclosure auction to sell the property. In addition to Deutsche Bank, six other registered bidders attended the foreclosure auction. Among the registered bidders were Francesco Rotondo, the previous mortgagor and owner of the property, and Aaron Additon, the owner and sole member of Infinity Real Estate LLC.

         At the foreclosure auction, Deutsche Bank provided bidders with the Terms and Conditions for the Public Sale. Ex. A-3 (ECF No. 27-3). The Terms and Conditions, which purported to contain “all of the terms set forth in the Purchase and Sale Agreement form included in the bidder's prospectus and provided to registered bidders at the time of registration to bid, ” Ex. A-3 § D, included the following provision governing Defendant's right to close the sale with someone other than the highest bidder:

(F) … In the event that there is a failure to close the sale with any person who executes a Purchase and Sale Agreement, The Lender reserves the right to either hold a new sale or to contact the next highest bidder and allow that party to purchase the property as assignee of the interests of the highest bidder.

         At the end of the foreclosure auction, Francesco Rotondo was the highest bidder and Aaron Additon of Infinity Real Estate, LLC, the second highest bidder.[1] On January 17, 2017, Francesco Rotondo executed a Purchase and Sale Agreement with Deutsche Bank for a purchase price of $755, 000. However, Mr. Rotondo failed to close the sale of the Property.

         Following Mr. Rotondo's failure to close, counsel for Deutsche Bank offered to sell the Property to Infinity Real Estate LLC for $590, 024.19. Infinity Real Estate accepted this offer and on July 24, 2017, Mr. Additon signed a Purchase and Sale Agreement prepared by Deutsch Bank for the sale of the property. Ex. A-4 (ECF No. 27-4). Infinity Real Estate then paid the $5000 deposit.

         Infinity Real Estate was ready, willing, and able to close on the sale of the property. However, Deutsche Bank unilaterally refused to close the sale. Deutsche Bank does not contest that its refusal to honor the Purchase and Sale Agreement with Infinity Real Estate constituted a breach of that contract. Def.'s Opp. to Mot. Summ. J. 4, n.2.

         DISCUSSION

         Summary judgment is appropriate “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). As cautioned by the Supreme Court, “the 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). A material fact is one that has the potential to determine the outcome of the litigation. Id. at 248; Oahn Nguyen Chung v. StudentCity.com, Inc., 854 F.3d 97, 101 (1st Cir. 2017). To raise a genuine issue of material fact, the party opposing the summary judgment motion must demonstrate that the record contains evidence that would permit the finder of fact to resolve the material issues in their favor. See Triangle Trading Co. v. Robroy Indus., Inc., 200 F.3d 1, 2 (1st Cir. 1999) (“Unless the party opposing a motion for summary judgment can identify a genuine issue as to a material fact, the motion may end the case.”).[2]

         In its motion for summary judgment, Defendant asserts that the “sole issue . . . is whether 14 M.R.S.A. § 6323 bars Deutsche Bank's sale of the Property to Plaintiff, insofar as the Maine foreclosure statute requires that property sold at a foreclosure auction must be conveyed to the ‘highest bidder,' which was indisputably not the Plaintiff here.” Def.'s Mot. 1-2. Plaintiff, on the other hand, moves for summary judgment based on the Terms and Conditions of the Public Sale, which allowed for Deutsche Bank to contact the next highest bidder upon the highest bidder's failure to close, to refuse any irregular bids, and to determine the highest bidder. Pl.'s Mot. 5.

         I. Construing the Statute

         The foreclosure statute provides that the seller “shall sell the premises to the highest bidder.” 14 M.R.S. § 6323(1).[3] When interpreting the meaning of a statute, Maine courts endeavor to give effect to legislative intent as expressed, ideally, in the plain language of the statute. Wawenock, LLC v. Dep't of Transp., 187 A.3d 609, 612 (Me. 2018). If the plain language leaves room for interpretation, then courts will seek to avoid readings that are absurd, inconsistent, ...


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