Ameris Bank v. Me You And A Pizza LLC et al

Filing 36

MEMORANDUM OPINION Signed by Chief Judge Karon O Bowdre on 9/21/17. (SAC )

FILED
2017 Sep-21 PM 12:02
U.S. DISTRICT COURT
N.D. OF ALABAMA

IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ALABAMA
SOUTHERN DIVISION
AMERIS BANK,
Plaintiff,
v.
ME YOU AND A PIZZA, LLC, et al.,
Defendants.

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2:16-cv-01636-KOB

MEMORANDUM OPINION
This matter is before the court on Plaintiff’s Renewed Motion for Summary Judgment.
(Doc. 29). This case centers on breach of contract claims against a borrower and four guarantors
following default on a loan. Defendants admitted in their Answer every element of Plaintiff’s
breach of contract claims except for damages. (Doc. 11). Although a response to this Renewed
Motion was due May 12, 2017, Defendants failed to file one. Plaintiff has also filed a
Supplement to its Motion to amend the amount of damages it alleges Defendants owe. (Doc. 32).
I.

Standard of Review
Summary judgment allows a trial court to decide cases when no genuine issues of

material fact are present and the moving party is entitled to judgment as a matter of law. See FED.
R. CIV. P. 56(a). When a district court reviews a motion for summary judgment, it must
determine two things: (1) whether any genuine issues of material fact exist; and if not,
(2) whether the moving party is entitled to judgment as a matter of law. Id.
In reviewing the evidence submitted, the court must view all evidence and factual
inferences drawn from it in the light most favorable to the non-moving party. See Augusta Iron &
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Steel Works, Inc. v. Emp’rs Ins. of Wausau, 835 F.2d 855, 856 (11th Cir. 1988) (citation
omitted). However, the non-moving party “need not be given the benefit of every inference but
only of every reasonable inference.” Graham v. State Farm Mut. Ins. Co., 193 F.3d 1274, 1282
(11th Cir. 1999) (citation omitted).
II.

Statement of Facts
Because Defendants failed to respond to the Renewed Motion for Summary Judgment or

otherwise challenge the evidence submitted by Plaintiff, the court accepts as undisputed
Plaintiff’s description of the facts. See Fed. R. Civ. P. 56(e) (“If a party . . . fails to properly
address another party’s assertion of fact . . . the court may . . . consider the fact undisputed for
purposes of the motion.”). Nevertheless, the court has reviewed the evidence submitted by
Ameris to determine whether it establishes the absence of a genuine dispute of material fact. See
United States v. One Piece of Real Property Located at 5800 SW 74th Ave., Miami, 363 F.3d
1099 (11th Cir. 2004).
On March 20, 2015, Defendant Me You and a Pizza, LLC (“MYP”) executed a
promissory note in which it promised to pay to Ameris Bank $494,000 plus interest and any other
amounts required by the note. Four guarantors, who are also named as defendants, executed
separate unconditional guaranties in which they promised to pay the amount owed under the note
upon written demand by Ameris. The also promised to pay all expenses Ameris incurred in
enforcing the guaranties, including attorney’s fees and costs.
The note provides that interest on the debt accrues at 2.5% above the prime rate as
published in the Wall Street Journal on the first business day of any month in which an interest
rate change occurs. The interest on the note accrued at 5.75% between March 20, 2015 and
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December 31, 2015 and has accrued at 6.00% since January 1, 2016. MYP was required to make
monthly payments of $5,422.60 beginning six months from March 20, 2015, and has failed to
make monthly payments since June 5, 2016. Thus, MYP is in default under the terms of the note.
The note permits Ameris to (1) require immediate payment of the debt in full in the event
of MYP’s default; (2) recover from MYP reasonable attorney’s fees and costs incurred in
collecting the amount owed under the note; and (3) demand immediate payment of those
attorney’s fees and costs or add that amount to the principal balance. In a letter dated September
16, 2016, Ameris demanded that MYP immediately pay the full amount “of principal, interest,
and other charges due under the Note,” which Ameris states in briefing included its legal
expenses. (Doc. 1-2 at 2). MYP received this letter and admits breaching its obligation to pay the
full amount owed under the note. Ameris has incurred and continues to incur legal fees and costs
in attempting to collect the amount due under the note.
In its September 16, 2016 letter, Ameris demanded that the guarantors pay the amount
owed under the guaranties. The guarantors received this letter and admit that they have breached
their obligation to pay the amount owed.
As of April 12, 2017, the amount of principal and interest owed under the note is
$487,394.48. Ameris states that, as of March 31, 2017, it has incurred $20,332.33 in legal fees
and costs. On May 10, 2017, Ameris sold equipment in which it had held a security interest
under the note, netting $2,700 that Ameris acknowledges should be credited to the amount owed
under the note.
III.

Discussion
Under Alabama law, to succeed on its breach of contract claim, Ameris must show: “(1) a
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valid contract binding the parties; (2) [Ameris’s] performance under the contract;
(3) [Defendants’] nonperformance; and (4) resulting damages.” Reynolds Metals Co. v. Hill, 825
So. 2d 100, 105 (Ala. 2002). No dispute of fact exists as to whether the promissory note or the
guaranties were valid contracts; whether Ameris performed its obligation to loan MYP $494,000;
or whether Defendants failed to pay the amounts owed under the note and the guaranties.
As to damages, the only element initially in dispute, none of the five Defendants has
presented evidence contradicting Ameris’s showing that MYP owes $487,394.48 in principal and
interest under the note as of April 12, 2017, or that interest has accrued since that date and
continues to accrue at the rate of $76.09 per day. Further, Defendants have not disputed that they
are obligated to pay Ameris reasonable attorney’s fees and costs incurred in collecting the
amount due under the note and enforcing the guaranties.
Although the court granted Defendants additional time to obtain discovery before
responding to Plaintiff’s initial summary judgment motion, Defendants have presented no
evidence disputing Ameris’s calculation of the damages they owe under the note. Nor have they
presented evidence of an equitable defense that would affect the amount owed under the
contracts.
Accordingly, because the undisputed evidence shows that MYP and Guarantors have
breached their payment obligations under the note and the guaranties, the court finds that, as of
April 12, 2017, MYP and each of the Guarantors was obligated to Ameris in the amount of
$484,694.48, and that MYP and each of the Guarantors is also obligated to Ameris for the
interest that has accrued since April 13, 2017, at the rate of $76.09 daily, in addition to
reasonable attorney’s fees and costs incurred by Ameris in collecting the amount due under the
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note and enforcing the guaranties.
The court WILL GRANT Plaintiff’s Renewed Motion for Summary Judgment. The
court WILL DIRECT Ameris to submit its final claim for interest and for attorney’s fees and
costs. The claim for attorney’s fees and costs must contain sufficient detail for the court to
determine whether the requested amounts are reasonable. Upon receipt of the final calculation of
the debt, the court will enter final judgment for Plaintiff. It will then give Defendants an
opportunity to respond only to the requested attorney’s fees.
DONE this 21st day of September, 2017.

____________________________________
KARON OWEN BOWDRE
CHIEF UNITED STATES DISTRICT JUDGE

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