Farm Credit of Northwest Florida, ACA v. Pittman

Filing 26

MEMORANDUM OPINION AND ORDER; that Motion for Relief from Judgment 18 is DENIED as further set out. Signed by Hon. Chief Judge Mark E. Fuller on 11/3/2010. (Attachments: # 1 Civil Appeals Checklist)(jg, )

Farm Credit of Northwest Florida, ACA v. Pittman

Doc. 26

UNITED STATES DISTRICT COURT FOR THE MIDDLE DISTRICT OF ALABAMA SOUTHERN DIVISION

F A R M CREDIT OF NORTHWEST F L O R ID A , ACA, P la in tif f , v. W IN D H A M TODD PITTMAN, D e f e n d a n t.

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CASE NO. 1:10-cv-0352-MEF (W O -D O NOT PUBLISH)

MEMORANDUM OPINION AND ORDER
T h is cause is before the Court on Defendant Windham Todd Pittman's ("Pittman") M o tio n for Relief from Judgment (Doc. # 18) and Brief in Support of said Motion (Doc. # 2 3 ) (collectively, "the Motion"). Pittman seeks relief from this Court's final judgment e n te re d against him on August 30, 2010 (Doc. # 15) pursuant to Fed. R. Civ. P. 60(b)(1), (3 ), and (6). Rule 60(b) enumerates grounds on which a court may relieve a party from a f in a l judgment. For this reasons set out below, this motion is due to be DENIED. I. FACTUAL AND PROCEDURAL HISTORY O n April 30, 2009, Land Ventures for Two, LLC ("Land Ventures") entered into a n agreement with Plaintiff Farm Credit of Northwest Florida ("Farm Credit") which m o d if ie d the terms of a previously negotiated loan transaction. Farm Credit required an in d iv id u a l to cosign the Note Modification Agreement ("NMA"), and Pittman did so. In 1

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March 2010, Land Ventures filed for Chapter 11 Bankruptcy, and Farm Credit filed this s u it against Pittman, as cosigner, to collect on the NMA. (Doc. # 1). Pittman answered, p le a d in g several affirmative defenses including waiver, estoppel, laches, and statute of lim ita tio n s . (Doc. # 6). He raised neither the defense of fraud nor misrepresentation in h is Answer. Farm Credit filed a Motion for Summary Judgment in June 2010, to which P ittm a n did not respond. (Doc. # 8). This Court granted that motion and entered a Final J u d g m e n t against Pittman in the amount of $741,113.81. (Doc. # 15).1 O n July 2, 2010, Land Ventures filed suit against Farm Credit, alleging a violation o f the bankruptcy court's automatic stay. In August, 2010, Land Ventures amended its c o m p la in t to allege fraud claims against Farm Credit. Pittman is concerned that in the e v e n t Land Ventures succeeds in its fraud claims against Farm Credit, Pittman will be lia b le on a note found void in another legal proceeding. To prevent that perceived in ju s tic e and inconsistency, Pittman has filed the instant motion. II. LEGAL STANDARD R u le 60(b)(1) allows for relief from judgment in the case of "mistake, in a d v e rte n c e , surprise, or excusable neglect." Rule 60(b)(3) allows for relief on the basis o f "fraud . . . misrepresentation, or misconduct by an opposing party." Rule 60(b)(6) is a c a tc h a ll provision, allowing relief to be granted for "any other reason that justifies relief."

Also pending before this Court is Plaintiff Farm Credit's Motion for Award of Additional Costs of Collection, which seeks to increase the final judgment against Pittman to $805,539.14. (Doc. # 16). 2

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Rule 60(b)(6) is "an extraordinary remedy which may be invoked only upon a showing of e x c e p tio n a l circumstances." Cavaliere v. Allstate Ins. Co., 996 F.2d 1111, 1115 (11th C ir. 1993). III. ANALYSIS A . Rule 60(b)(1) P ittm a n cites Rule 60(b)(1) in his motion, but never alleges any mistake, in a d v e rte n c e , surprise, or excusable neglect upon which the Court could grant him relief.2 P ittm a n 's only alleged ground for relief is the inconsistency and injustice that would re s u lt if the NMA is later found to be void. This inconsistency and injustice does not fall w ith in the permissible grounds for relief contained in Rule 60(b)(1). Therefore, to the e x te n t that Pittman is seeking relief under Rule 60(b)(1), his motion is DENIED. B. Rule 60(b)(3) P ittm a n also cites Rule 60(b)(3) as a ground for which the court can grant him re lie f . Pittman's only allegation of fraud or misrepresentation in this case relates to the u n d e rlyin g contractual dispute, and not to any fraud perpetrated by Farm Credit in the p ro s e c u tio n of the instant lawsuit. The `fraud' contemplated by Rule 60(b)(3) is that w h ic h prevents "the losing party from fully and fairly presenting his case or defense."

Pittman may have an argument that his attorney was negligent in failing to respond to Farm Credit's Motion for Summary Judgment. However, the Eleventh Circuit "has demonstrated its wariness of grants of Rule 6)(b)(1) relief for excusable neglect based on claims of attorney error." S.E.C. v. Simmons, 241 Fed. App'x 660, 663-64 (11th Cir. 2007). Without a showing of excuse for any potential negligence, such an argument will not be sufficient for relief under Rule 60(b)(1). 3

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Frederick v. Kirby Tankships, Inc., 205 F.3d 1277, 1287 (11th Cir. 2000). Pittman has n o t alleged any instance of fraud that prevented him from presenting an aspect of his case o r defense. Therefore, to the extent that Pittman seeks relief under Rule 60(b)(3), his m o tio n is DENIED. C. Rule 60(b)(6) P ittm a n also seeks relief from judgment pursuant to Rule 60(b)(6), on the basis th a t the NMA may be found void in another proceeding. Pittman's argument is not p e rs u a s iv e . Under Alabama law, a party claiming fraudulent misrepresentation must prove (1) th a t the opposing party made a false representation, (2) of a material fact, (3) on which th e party reasonably relied, and (4) which proximately cause the party's injury. Boackle v . Bedwell Constr. Co., 770 So.2d 1076, 1080 (Ala. 2000). Alabama law recognizes lim ite d circumstances in which a plaintiff may properly state a fraud claim when the false re p re se n ta tio n s were made to a third party. Delta Health Grp., Inc. v. Stafford, 887 So. 2d 8 8 7 , 889 (Ala. 2004). However, the party claiming fraud must always demonstrate re lia n c e on the fraud in order to render the contract voidable. Id. Mr. Pittman states in h is Motion that he did not rely on any representations made by Farm Credit. (Doc. # 23). Therefore, Mr. Pittman could not claim that the NMA he cosigned is voidable as to him. The kind of fraudulent misrepresentations alleged by Land Ventures against Farm Credit

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would make a contract voidable, not void.3 Even if a jury finds that Farm Credit made m isre p re s e n ta tio n s to Land Ventures (through Pittman as agent) during the formation of th e NMA, the agreement is still enforceable against Pittman. Therefore, regardless of the o u tc o m e reached in the suit between Land Ventures and Farm Credit, that result will not b e inconsistent with the final judgment entered in this case. As Pittman has alleged no other exceptional circumstances on which this court c o u ld grant him the extraordinary relief permitted under Rule 60(b)(6), his motion is D E N IE D . DONE this the 3rd day of November, 2010.

/s/ Mark E. Fuller CHIEF UNITED STATES DISTRICT JUDGE

The principle is well established. See Rutter & Hendrix v. Hanover Fire Ins. Co., 35 So. 33, 37 (1903) ("[A]ll our decisions hold . . . that a misrepresentation . . . will not vitiate a contract."); Restatement (Second) of Contracts § 164 (1981) (explaining that if the party's assent was induced by fraud the contract is voidable by the defrauded party); Gulf Oil Corp. v. Spriggs Enterprises, Inc., 388 So. 2d 518 (Ala. 1980) (explaining that because a contract induced by fraud is ordinarily merely voidable, the defrauded party may choose either to enforce the contract or pursue damages for fraud). 5

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