Kersey v. American Honda Finance Corporation et al

Filing 77

Judge F. Dennis Saylor, IV: ORDER entered. MEMORANDUM AND ORDERPlaintiffs motion for summary judgment is DENIED, defendants motion for summary judgment is GRANTED, and defendants motion for sanctions is DENIED as moot. Defendant is further directed to file with the Court by May 11, 2018, a statement showing how the $13,404.80 sought in damages was calculated. With respect to the award of attorneys fees and costs, defendant is further directed to file a memorandum and supporting affidavits and exhibits by May 11, 2018; any opposition to defendants memorandum shall be filed by May 25, 2018; and any reply memoranda to oppositions shall be filed by June 1, 2018.(FDS, law1)

UNITED STATES DISTRICT COURT
DISTRICT OF MASSACHUSETTS
____________________________________
)
GEORGE E. KERSEY,
)
)
Plaintiff,
)
)
v.
)
)
AMERICAN HONDA FINANCE
)
CORPORATION and HERB
)
CHAMBERS 1189, INC.,
)
)
Defendants.
)
____________________________________)

Civil Action No.
16-12631-FDS

MEMORANDUM AND ORDER ON CROSS-MOTIONS FOR
SUMMARY JUDGMENT AND DEFENDANT’S MOTION FOR SANCTIONS
SAYLOR, J.
This is an action arising out of the attempted repossession of a vehicle. Plaintiff George
Kersey is a former attorney proceeding pro se. 1 He leased a vehicle from Herb Chambers 1186,
Inc. Financing was provided by defendant American Honda Finance Corporation (“AHFC”).
Kersey eventually defaulted on his lease payments, leading AHFC to begin the process of
repossessing his vehicle. He brought suit, contending that AHFC breached the lease agreement
and violated Rhode Island’s Automobile Repossession Act. AHFC then counterclaimed for the
remaining amount due under the lease agreement. The parties have cross-moved for summary
judgment. In addition, AHFC has moved for sanctions for Kersey’s failure to comply with a

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Kersey has been disbarred in New Hampshire and Massachusetts and disciplined in a variety of
jurisdictions. See, e.g., In re George E. Kersey, 444 Mass. 65 (2005); see also Kersey v. Becton Dickinson & Co.,
2016 WL 4492867 (D. Mass. August 25, 2016); Kersey v. Becton Dickinson & Co., 2011 WL 2516162 (3d Cir. June
24, 2011); In re Kersey’s Case, 150 N.H. 585 (2004); In re Kersey, 185 N.J. 130 (2005); In re George E. Kersey, 27
A.D. 3d 118 (N.Y. App. Div. 2006); In re George E. Kersey, 775 A.2d 1106 (D.C. 2001).

court order. For the following reasons, plaintiff’s motion for summary judgment will be denied,
defendant’s motion for summary judgment will be granted, and defendant’s motion for sanctions
will be denied as moot.
I.

Background
The following facts are as set forth in the record.
A.

Factual Background

George Kersey is a citizen of Rhode Island. (Compl. ¶ 1). 2 On December 13, 2013, he
signed a vehicle lease agreement to lease a 2013 Honda Civic from Herb Chambers 1186, Inc., a
Massachusetts corporation. (Id.; Def. Ex. 3 ¶ 17). Under the lease agreement, he was obligated
to make monthly payments of $221.00 for 36 months. (Def. Ex. 3 ¶ 6). The contract also
included a provision that provided him the option to purchase the vehicle outright either before
or at the end of the lease term. (Id. ¶¶ 8, 25). Herb Chambers 1186, Inc., as lessor, assigned its
interest in the lease to AHFC. (Id. ¶ 43). 3
The lease also included a default provision, which provided in relevant part: “[The
lessee] will be in default if: (a) [the lessee] fail[s] to make any payment when due under this
lease and any required period before a default may occur has elapsed . . . .” (Id. ¶ 34). The
provision further stated: “In the event of default, lessor may do any or all of the following . . .
(b) terminate the lease and [the lessee’s] rights to possess and use the vehicle; (c) take possession
of the vehicle by any method or manner permitted by law; (d) determine [the lessee’s]
termination liability on an early termination basis which [the lessee] agree[s] to pay

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However, he receives his mail at a Framingham, Massachusetts address. (Compl. ¶ 1).

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AHFC, doing business as Honda Financial Services, is a California corporation registered to do business
in Massachusetts. (Compl. ¶ 1). AHFC is the lease administrator for Honda Lease Trust, the formal assignee set
forth in the lease agreement. (Def. Ex. 3 at 1).

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immediately; . . . and (f) pursue any other remedy permitted by law.” (Id.).
Two months into the lease, Kersey failed to make timely payments and defaulted. (Def.
Ex. 7 at 19). On April 18, 2014, AHFC mailed a pre-repossession letter titled “Rights of
Defaulting Consumer under Rhode Island General Laws” to Kersey’s Rhode Island and
Massachusetts addresses. (Def. Ex. 12). The letter stated that Kersey would have 21 days to
cure his default, or AHFC would repossess the vehicle. (Id.). On April 25, 2014, AHFC mailed
Kersey a “Past Due Account” letter, again requesting immediate payment. (Def. Ex. 15). It is
undisputed that Kersey received these letters. (Kersey Dep. at 111).
On May 13, 2014, more than 21 days after AHFC mailed the pre-repossession letter,
AHFC assigned the vehicle for repossession. (Andrews Aff. ¶ 13). The next day, Kersey’s
account was billed a $105 repossession fee. (Id. ¶ 14). Despite Kersey remaining in default, the
vehicle was never recovered. (Id. ¶ 16). It appears that over the next two years, Kersey made
intermittent payments in an attempt to remain current on the lease. (See generally Def. Ex. 7).
On April 13, 2016, AHFC mailed Kersey a second pre-repossession letter titled “Rights
of Defaulting Consumer under Rhode Island General Laws.” (Def. Ex. 17). Again, the letter
stated Kersey would have 21 days to cure his default. (Id.). On April 25, 2016, AHFC mailed
another “Past Due Account” letter. (Def. Ex. 19). An invoice generated on June 21, 2016 stated
that Kersey owed: (1) two past monthly payments; (2) the June 2016 monthly payment; (3)
seven late fees; (4) an outstanding Rhode Island registration fee; and (5) the $105 repossession
fee charged to his account on May 14, 2014. (Andrews Aff. ¶ 20; Def. Ex. 7 at 4).
Although the lease was scheduled to end in December 2016, Kersey failed to return the
vehicle or inform AHFC of its location. (Andrews Aff. ¶¶ 21, 24-25). Presumably, at this point
Kersey has stolen the vehicle. AHFC has calculated the total amount owed by Kersey to be

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$13,408.80. (Id. ¶ 24).
B.

Procedural Background

Kersey filed suit on December 27, 2016, against AHFC and “Herb Chambers 1189, Inc.”
His complaint appears to assert two counts against defendants: a claim for breach of contract
and a claim for violation of R.I. Gen. Laws § 6-51. The complaint stated that plaintiff sought to
recoup five repossession charges of $105, monetary damages in the amount of $10,000, and
punitive damages in the amount of $1 million. (Compl. at 3-4).
On June 1, 2017, AHFC filed a motion to amend its answer to assert a counterclaim
against Kersey for breach of contract. The Court granted the motion on July 10, 2017.
In the interim, Kersey had failed to properly serve Herb Chambers 1186, Inc., because he
had erroneously brought suit against “Herb Chambers 1189, Inc.” On July 10, 2017, the Court
ordered Kersey to file an amended complaint by July 20, 2017, identifying the correct name of
that defendant. In addition, the Court ordered Kersey to properly serve the amended complaint
on Herb Chambers 1186, Inc., by August 19, 2017. No amended complaint was ever filed, and
Herb Chambers 1186, Inc. was never served.
On December 20, 2017, Magistrate Judge Cabell granted two motions to compel filed by
AHFC, ordering Kersey to provide further responses to interrogatories and produce various
documents. (Docket No. 57). However, Kersey failed to comply, and AHFC filed a motion for
sanctions on January 11, 2018. Thereafter, the parties cross-moved for summary judgment.
II.

Legal Standard
The role of summary judgment is to “pierce the pleadings and to assess the proof in order

to see whether there is a genuine need for trial.” Mesnick v. General Elec. Co., 950 F.2d 816,
822 (1st Cir. 1991) (quoting Garside v. Osco Drug, Inc., 895 F.2d 46, 50 (1st Cir. 1990)).

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Summary judgment is appropriate when the moving party 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). A genuine issue is “one that must be decided at trial because the evidence,
viewed in the light most flattering to the nonmovant, would permit a rational fact finder to
resolve the issue in favor of either party.” Medina-Munoz v. R.J. Reynolds Tobacco Co., 896
F.2d 5, 8 (1st Cir. 1990) (citation omitted). In evaluating a summary judgment motion, the court
indulges all reasonable inferences in favor of the nonmoving party. See O'Connor v. Steeves,
994 F.2d 905, 907 (1st Cir. 1993). When “a properly supported motion for summary judgment is
made, the adverse party must set forth specific facts showing that there is a genuine issue for
trial.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 250 (1986) (quotations omitted). The
nonmoving party may not simply “rest upon mere allegation or denials of his pleading,” but
instead must “present affirmative evidence.” Id. at 256–57.
III.

Analysis
A.

Plaintiff’s Claims

As stated earlier, the pro se complaint appears to bring claims for breach of contract and
improper repossession of the Honda Civic in violation of R.I. Gen. Laws § 6-51.
To prove a breach of contract under Massachusetts law, a plaintiff must show “that there
was a valid contract, that the defendant breached its duties under its contractual agreement, and
that the breach caused the plaintiff damage.” Guckenberger v. Boston Univ., 957 F. Supp. 306,
316 (D. Mass. 1997) (citations omitted); accord Michelson v. Digital Fin. Servs., 167 F.3d 715,
720 (1st Cir. 1999). If a contract is unambiguous, a court must interpret it in accordance with its
ordinary and plain meaning. See Citation Ins. Co. v. Gomez, 426 Mass. 379, 381 (1998).

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In its incontrovertible that the lease agreement plaintiff signed on December 13, 2013,
governs the relationship between the parties. 4 The explicit terms of the contract stated that
plaintiff was obligated to make timely monthly payments of $221. (Def. Ex. 3 ¶ 6). The parties
agree that plaintiff defaulted by failing to make his payments. (Andrews Aff. ¶¶ 9-12, 17-22;
Kersey Dep. at 64-65). 5 AHFC, as assignee to Herb Chambers 1186, Inc.’s interest, was
accordingly allowed to take various actions, including terminating the lease and repossessing the
vehicle. (Def. Ex. 3 ¶¶ 34, 43). Therefore, defendant did not breach the contract by attempting
to repossess plaintiff’s vehicle.
The complaint also alleges that defendant violated the Rhode Island Automobile
Repossession Act, as codified in R.I. Gen. Laws § 6-51. That statute provides that after a
consumer defaults on a vehicle lease, the lessor cannot repossess the vehicle unless the consumer
is first provided 21 days to cure the default. R.I. Gen. Laws § 6-51-3(c). In addition, the statute
requires that written notice be given to the consumer that “conspicuously state[s] the rights of the
consumer” and includes the heading, “Rights of Defaulting Consumer under Rhode Island
General Laws.” Id.
The evidence plainly shows that defendant mailed such letters to plaintiff before
attempting to repossess the vehicle. The letters were sent on April 18, 2014, and April 13, 2016,
and warned plaintiff that unless he cured his default within 21 days, defendant would repossess
the vehicle. (Def. Exs. 12, 17). Accordingly, the undisputed evidence shows that defendant did

4

In his deposition, plaintiff conceded that he entered into the lease agreement. (Kersey Dep. at 34).

5

In his deposition, plaintiff was asked, “Mr. Kersey, do you agree that you never made 36 monthly
payments as contemplated by [the lease]?” (Kersey Dep. at 64-65). Plaintiff replied, “That is correct.” (Id. at 65).

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not violate the Rhode Island Automobile Repossession Act, and summary judgment on
plaintiff’s claims will be granted to defendant. 6
B.

Defendant’s Counterclaim

In its amended answer, defendant brings a counterclaim for breach of contract. (Am.
Ans. ¶¶ 17-20). As set forth above, plaintiff conceded that he failed to make certain lease
payments and has failed to return the vehicle to defendant. Therefore, plaintiff breached the
lease agreement.
Plaintiff has opposed the counterclaim by contending that defendant “was not the lessor
or assignee of the lease agreement” and that defendant “had cancelled the lease agreement.”
(Pl.’s Mot. for SJ ¶ 2). However, the lease agreement plainly states that Herb Chambers 1186,
Inc. assigned its interest as lessor to AHFC. (Def. Ex. 3 ¶ 43). Defendant was thus entitled to all
legal rights and remedies that Herb Chambers 1186, Inc. could have pursued, including
repossession. In addition, plaintiff has provided no evidence showing that defendant “cancelled
the lease agreement.” Accordingly, summary judgment on the counterclaim will be granted to
defendant.
In its memorandum, defendant states that it is seeking judgment in the amount of
$13,404.80. (Def. Mem. in Supp. at 15). However, it is unclear how defendant arrived at that
amount. Defendant will be directed to file with the court by May 11, 2018, a statement showing
how that amount was calculated.
In addition, defendant seeks reasonable attorneys’ fees and costs. (Def. Mem. in Supp. at
15). In Massachusetts, the “usual rule” “is that the litigant must bear his own expenses.”

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Defendant contends that the lease specifies that the relationship between the parties was to be governed by
Massachusetts law, and that Massachusetts does not have an analogous provision requiring pre-repossession notice.
However, as plaintiff’s claim under Rhode Island law clearly fails, the Court need not address this argument.

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Waldman v. Am. Honda Motor Co., Inc., 413 Mass. 320, 321 (1992). Here, however, the lease
agreement specified that in “event of default,” the lessee agreed “to pay lessor for all collection
and legal costs, including all reasonable attorneys’ fees and court costs lessor incurs, to the
extent permitted by law.” (Def. Ex. 3 ¶ 34). The Court will therefore award reasonable
attorneys’ fees and costs to defendant. The amount of those fees and costs will be determined at
a later stage in this proceeding.
C.

Defendant’s Motion for Sanctions

Defendant has also moved for sanctions in light of plaintiff’s refusal to comply with
Magistrate Judge Cabell’s order. In its motion, defendant requests that: (1) plaintiff be found in
contempt of court; (2) plaintiff be deemed to have admitted certain requests for admissions; (3)
the complaint be dismissed; and (4) default judgment be entered against plaintiff on defendant’s
counterclaim. Because the Court has addressed the parties’ dispositive motions on the merits,
the motion for sanctions is denied as moot.
IV.

Conclusion
For the foregoing reasons, plaintiff’s motion for summary judgment is DENIED,

defendant’s motion for summary judgment is GRANTED, and defendant’s motion for sanctions
is DENIED as moot.
Defendant is further directed to file with the Court by May 11, 2018, a statement showing
how the $13,404.80 sought in damages was calculated.
With respect to the award of attorneys’ fees and costs, defendant is further directed to file
a memorandum and supporting affidavits and exhibits by May 11, 2018; any opposition to
defendant’s memorandum shall be filed by May 25, 2018; and any reply memoranda to
oppositions shall be filed by June 1, 2018.

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So Ordered.

/s/ F. Dennis Saylor
F. Dennis Saylor IV
United States District Judge

Dated: April 20, 2018

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