Schwartz v. Bank of America, N.A. et al

Filing 77

ORDER. Ordered that Defendant's Motion for Summary Judgment on its Counterclaim, 45 is denied by Chief Judge Wiley Y. Daniel on 06/07/11.(jjh, )

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLORADO
Chief Judge Wiley Y. Daniel
Civil Action No. 10-cv-01225-WYD-MJW
KEITH SCHWARTZ,
Plaintiff,
v.
BANK OF AMERICA, N.A.
BAC HOME LOANS SERVICING, LP
BILL WALLACE IN HIS CAPACITY AS
PUBLIC TRUSTEE, SUMMIT COUNTY, COLORADO
Defendants.

ORDER

I.

INTRODUCTION AND BACKGROUND
THIS MATTER is before the Court on Defendant’s Motion for Summary

Judgment on its Counterclaim, filed November 29, 2010 [ECF No. 45], in which
Defendant Bank of America, N.A (“Bank of America”) seeks summary judgment on its
counterclaim for breach of contract.
This case involves the attempted foreclosure of Plaintiff’s property initiated by
Defendant Bank of America on or about March 13, 2009, through the Public Trustee for
Summit County, Colorado. On May 11, 2010, Plaintiff filed the instant action in District
Court for Summit County asserting numerous claims related to Defendant’s conduct
both before and during the foreclosure process. On May 26, 2010, Defendant removed
this case from Summit County District Court to this Court. An Amended Complaint was
filed on November 1, 2010. Therein, Plaintiff alleged that he is the owner of certain real

property located in Silverthorne Colorado (the “Property”), and that Defendant Bank of
America is the putative owner of a security interest in the Property by virtue of a Deed of
Trust secured by a Promissory Note in the amount of $1,250,000.00, dated November
23, 2005, and recorded on November 29, 2005. Plaintiff asserted nine separate claims
for relief including claims for (1) wrongful foreclosure; (2) declaratory relief; (3) violation
of the Colorado Fair Debt Collection Practices Act; (4) violation of the Real Estate
Settlement Procedures Act; (5) misrepresentation; (6) negligent lending; (7) breach of
contract; (8) promissory estoppel; and (9) outrageous conduct. In addition, Defendant
Bank of America asserted counterclaims for breach of contract and unjust enrichment.
By order dated March 28, 2011, I granted Defendant Bank of America’s motion to
dismiss all of Plaintiff’s claims for relief. Thus, the only claims remaining in this case are
Defendant’s counterclaims.
In its motion for summary judgment, Defendant Bank of America seeks summary
judgment on its counterclaim for breach of contract. Defendant asserts that on or about
November 23, 2005, Plaintiff executed and delivered to Defendant Bank of America an
Adjustable Rate Note (the “Promissory Note”), the terms of which required Plaintiff to
make initial interest-only payments of $6,640.63 every month beginning on January 1,
2006, at an interest rate of 6.375%. Defendant has attached a copy of the Promissory
Note to its motion as Exhibit A-1. Defendant further asserts that Plaintiff has been in
default on the Promissory Note since January, 2008, and that the amount due on the
Promissory Note as of December 20, 2010 is $1,523,805.56. In addition to the balance
of the note, Defendant seeks to recover all of its collection costs, including attorneys’
fees, incurred in enforcing the terms of the note.
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Plaintiff filed a verified response to the motion in which he admits to executing a
promissory note on or about November 23, 2005, but denies executing and delivering to
Bank of America the document attached to Defendant’s motion at Exhibit A-1. Plaintiff
does admit that he agreed to make monthly payments to Defendant Bank of America
beginning January 1, 2006, and that his last payment was made on December 4, 2007.
However, Plaintiff denies that he is in default under the Promissory Note and asserts
that the Promissory Note attached to Defendant’s motion is not authentic and was
procured through fraud. Plaintiff also submits a statement of additional disputed facts,
the vast majority of which are either conclusory in nature or irrelevant to the arguments
presented in the instant motion, and none of which are supported by citation to evidence
in the record.
II.

ANALYSIS
A.

Summary Judgment Standard

Pursuant to Rule 56(c) of the Federal Rules of Civil Procedure, the court may
grant summary judgment where "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 the ... moving party is entitled to judgment as a matter
of law." Fed. R. Civ. P. 56(c); see Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 250
(1986); Equal Employment Opportunity Comm. v. Horizon/CMS Healthcare Corp., 220
F.3d 1184, 1190 (10th Cir. 2000). “When applying this standard, the court must ‘view
the evidence and draw all reasonable inferences therefrom in the light most favorable to
the party opposing summary judgment.’” Atlantic Richfield Co. v. Farm Credit Bank of
Wichita, 226 F.3d 1138, 1148 (10th Cir. 2000) (quotation omitted). All doubts must be
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resolved in favor of the existence of triable issues of fact. Boren v. Southwestern Bell
Tel. Co., 933 F.2d 891, 892 (10th Cir. 1991).
B.

Whether Summary Judgment is Proper in this Case

A party attempting to recover on a breach of contract claim must prove the
following elements: (1) the existence of a contract; (2) performance by the plaintiff or
some justification for nonperformance; (3) failure to perform the contract by the
defendant; and (4) resulting damages to the plaintiff. Western Distributing Co. v.
Diodosio, 841 P.2d 1053, 1058 (Colo. 1992). In the case at hand, Defendant argues
that Plaintiff cannot show the existence of a genuine fact as to the breach of his
repayment obligations under the Promissory Note.
While it is a very close call, I find that upon review of Plaintiff’s verified response,
and excerpts from his deposition testimony attached to Defendant’s reply in support of
its motion, that genuine issues of material fact exist regarding whether Plaintiff signed
the Promissory Note at issue. Many of the arguments raised by Plaintiff in his response
are wholly irrelevant to whether he executed the Promissory Note at issue. However,
he has alleged that the Promissory Note is not authentic based on Defendant’s
submission of two separate promissory notes during the course of this litigation, only
one of which contains an endorsement by Bank of America. In addition, Plaintiff denies
he signed either of the notes, and testified in his deposition that he does not recall
signing the Promissory Note attached to Defendant’s motion for summary judgment.
During his deposition Plaintiff also denied signing any note that provides for an initial
6.375% interest rate, and testified that he recalls agreeing to a 4.5% interest rate.
Finally, Plaintiff testified that he applied for a fully documented loan, and that Defendant
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placed him a “stated income” loan, which he contends carried a higher interest rate than
a fully documented loan. I must construe this evidence in the light most favorable to
Plaintiff, and resolve all doubts in favor of the existence of triable issues of fact. Boren
v. Southwestern Bell Tel. Co., 933 F.2d at 892.
Accordingly, I find that there are genuine issues of material fact regarding the
existence of a contract between the parties, and that summary judgment is not proper
on Defendant’s counterclaim for breach of contract.
III.

CONCLUSION
Therefore, for the reasons set forth herein, it is hereby
ORDERED that Defendant’s Motion for Summary Judgment on its Counterclaim,

filed November 29, 2010 [ECF No. 45] is DENIED.
Dated: June 7, 2011
BY THE COURT:

s/ Wiley Y. Daniel
Wiley Y. Daniel
Chief United States District Judge

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