WEBB v. KRUDYS

Filing 42

OPINION. Signed by Judge William H. Walls on 08/082017. (ek)

NOT FOR PUBLICATION
UNITED STATES DISTRICT COURT
DISTRICT OF NEW JERSEY

SCOTT WEBB, EXECUTOR OF THE
ESTATE OF NORMAN WEBB,
OPINION

Plaintiff,

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Civ. No. 15-5247 (WHW)(CLW)
V.

DAN KRUDYS,
Defendant.

Walls, Senior District Judge

Plaintiff Scott Webb, Executor of the Estate of Norman Webb, moves for an Order
granting summary judgment in its favor on its breach of contract claim against Defendant Dan
Krudys. ECF Nos. 29—30. The case concerns a loan Note executed by the late Norman Webb in
the amount of$150,000 to the defendant in April 2011. Plaintiff seeks $137,610.15 in principal,
interest, and late fees due to Defendant’s breach of contract. Decided without oral argument
under federal Rule of Civil Procedure 78, the motion is granted.
FACTUAL AND PROCEDURAL BACKGROUND

Scott Webb, acting as the executor for the estate of his deceased father, Norman Webb
(“the Estate”) brought this action against Defendant Dan Krudys, the former husband of Cheryl
Krudys, Norman Webb’s daughter. Compi., ECF No. 1

¶J 1—3. Norman Webb was a resident of

New Jersey. Id. Defendant Dan Krudys is a resident of Kansas. Id. ¶3. Dan Krudys executed a
promissory note on April 1, 2011 (the “Note”), borrowing $150,000 from Norman Webb for a
term of four years at four percent (4%) annual interest, payable in monthly installments of
$3,386.86. Berutti Decl., Ex. A. Under the Note, payment was due on the first day of each month
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beginning May 1, 2011, and concluding with final payment on April 1, 2015. Id. The Note
provides for a four percent (4%) late charge for any payment not received within ten (10) days
after the due date, and payment of the Lender’s costs of collection and reasonable attorney fees
upon the Borrower’s default. Id. Defendant admits that he was of sound mind and freely
executed the loan document, Berutti Deci., Ex. H at 9:3—10:5, which was drafted by his own
attorney, James H. Waizer, Esq., Id. at 10:2—11:22.
Beginning on May 1, 2011, Defendant made thirteen (13) full payments of $3,386.86,
totaling $44,029.18, Bertutti Deci., Ex. D, and two (2) additional payments of $327.37, totaling
$744.74, Bertutti Decl., Exs. E & H at 21:9—24:4. In total, Mr. Krudys paid $44,773.92,
representing principal payments of $38,289.00 and interest payments of $6,484.92. Id. It is
undisputed that the last payment made by Mr. Krudys was dated December 31, 2012, Bertutti
Deci., Ex. E, and Mr. Krudys admits that he did not personally pay off the note.
On July 6, 2015, Plaintiff filed its Complaint against Dan Krudys asserting causes of
action for breach of contract, book account, and unjust enrichment. ECF No. 1
also seeks reasonable attorney fees and costs. ECF No. 1

¶ 8—18. Plaintiff

¶ 18. About six weeks after the filing of

the complaint in this action, Dan Krudys filed for divorce from Cheryl Krudys. Bertutti Deci.,
Ex. F at 1. The divorce is relevant only to the extent that the Krudys’ divorce agreement, entered
into on June 15, 2016 states: “Petitioner [Mr. Krudys] shall be solely responsible for the
following debts.

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The debt owed to the Estate of Norm Webb, which is subject to a pending

lawsuit in the United States District Court in the District of New Jersey, Case No. 2:1 5-CV05247-WHW-CLW.

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.“

Id. at 12.

On December 9, 2016 Plaintiff filed for summary judgment. ECF No. 29. Plaintiff
contends that as a result of Mr. Krudys’ breach of contract, Norman Webb’s Estate is due the

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remaining principal balance of$1 11,711, plus interest at four percent (4%) since June 1, 2013
($20,480.35), and late fees on forty (40) of the scheduled payments ($5,418.80), ECF No. 30-1 at
3—4, for a total of $137,610. Id. at 4. Plaintiff also asks the Court for permission to file an
application for attorney fees and costs as provided for by the Note. ECF No. 30-1 at 4.
Mr. Krudys disputes that he owes anything and opposes summary judgment, arguing that
while he did not personally pay off the loan, “his ex-wife told him that the Note was paid from
her share of the inheritance” she received from Norman Webb’s Estate. ECF No. 36 at 4; see
also Bertutti Deci., Ex. H at 13:3-23. Mr. Krudys contends whether the Note was paid from Ms.
Krudys’ inheritance is a genuine issue of material fact precluding summary judgment because it
prevents Plaintiff from establishing that Defendant breached the Note and damaged the Estate.
ECFNo. 36at4.
In support of his argument that the Estate paid the loan from Ms. Krudys’ inheritance,
Mr. Krudys offers deposition testimony from himself, Scott Webb, and Cheryl Krudys, an
interrogatory answer by Cherly Krudys given during the Krudys’ divorce action,1 and two letters
from the Executor of the Estate, Scott Webb, to Norman Webb’s heirs. The first letter, dated
August 1, 2014, states that Ms. Krudys wanted her inheritance reduced by the outstanding debt
amount until Mr. Krudys could repay the Estate. Krudys Deci., Ex. A. The second letter, dated

‘Defendant’s opposition brief, ECF No. 36, repeatedly cites Ms. Krudys’ Answer to
Interrogatory #75, an interrogatory response from the Krudys’ divorce action, and states that it is
attached as Exhibit B to the Krudys Declaration, ECF No. 36-3. Exhibit B to the Krudys
Declaration is not Interrogatory #75. Instead, it is an interrogatory response from the Plaintiff in
this case, which certifies that no portion of Cher Krudys’ inheritance from the Estate of Norman
Webb was used to satisfy any portion of the Note which is the subject of this lawsuit. Because
Interrogatory #75 does not appear on the record, the Court will not consider it in deciding this
motion. C’f Fed. R. Civ. P. 56(c)(3).
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July 27, 2015, announces that Ms. Krudys changed her mind and no longer wanted Mr. Krudys’
debt taken from her inheritance. Bray Deci., Ex. A.
Mr. Krudys also tries to show that Cheryl Krudys did not receive the same inheritance as
the other Norman Webb beneficiaries, to argue that the Estate satisfied the debt due on the Note
from Ms. Krudys’ share. ECF No. 36 at 5—6. But the Court previously stated in an opinion
addressing a discovery request made by Mr. Krudys, which sought all documents relating to Ms.
Krudys’ inheritance and “copies of the cancelled checks distributed by the Estate of Norman
Webb to the heirs,” ECF No. 17-1 at 5, that it does not consider evidence such as the total
amount of inheritance Ms. Krudys received to bear on Mr. Krudys’ defense. ECF No. 22 at 5.
In its reply brief, Plaintiff responds to Defendant by arguing that the evidence he offers
actually shows that Cheryl Krudys “received the same [inheritance] portion as her other four
siblings,” but that the issue and proof is immaterial because the Court already recognized “the
amount of distributions from the Estate to Cheryl Krudys is not the same question as whether or
not the Note was paid off.” ECF No. 39 at 2—3. Plaintiff claims that there is no genuine dispute
as to the latter issue because no admissible evidence contradicts Plaintiff’s position that no
portion of Ms. Krudys’ inheritance was used to pay the Note. Plaintiff cites to several sworn
statements by the Estate and Ms. Krudys affirming that the Estate did not pay the outstanding
balance on the Note. See e.g., Bertutti Deci., Exs. G & I at 44:14-6; Bertutti Decl., Ex. J at 39:912. One example is Defendant’s June 2, 2016 interrogatory, which asked “[w]as any portion of
Cher Krudys’s inheritance from the Estate of Norman Webb used to satisfy any portion of the
Note which is the subject of this lawsuit” to which Plaintiff replied “No.” Bertutti Deci., Ex. G.

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STANDARD Of REVIEW

Summary judgment is appropriate where “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). A factual dispute between the parties must be both genuine and material to defeat a
motion for summary judgment. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247—48 (1986). A
disputed fact is material where it would affect the outcome of the suit under the relevant
substantive law. Scott v. Harris, 550 U.S. 372, 380 (2007). A dispute is genuine where a rational
trier of fact could return a verdict for the non-movant. Id.
The movant bears the initial burden to demonstrate the absence of a genuine issue of
material fact for trial. Beard v. Banks, 548 U.S. 521, 529 (2006). Once the movant has carried
this burden, the non-movant “must do more than simply show that there is some metaphysical
doubt as to the material facts” in question. Scott, 550 U.S. at 380 (citing Matsushita Elec. Indus.
Co. v. Zenith Radio Corp., 475 U.S. 574, 586—87 (1986)). Each party must support its position
by “citing to particular parts of materials in the record.

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or showing that the materials cited do

not establish the absence or presence of a genuine dispute, or that an adverse party cannot
produce admissible evidence to support the fact.” Fed. R. Civ. P. 56(c)(1). Facts must be viewed
in the light most favorable to the nonmoving party only if there is a genuine dispute as to those
facts. Scott, 550 U.S. at 380. At this stage, “the judge’s function is not.

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to weigh the evidence

and determine the truth of the matter.” Anderson, 477 U.S. at 249. “[W]here the nonmoving
party bears the burden of proof, it must by affidavits, or by the depositions and admissions on
file make a showing sufficient to establish the existence of every element essential to that party’s
case.” Childers v. Joseph, 842 F.2d 689, 694 (3d Cir. 1988) (quoting Equimark Commercial Fin.

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Co. v. C.I.T. Fin. Servs. Corp., 812 F.2d 141, 142 (3d Cir. 1987) (quoting Celotex Corp. v.
Catrett, 477 U.S. 317, 322 (1986))) (internal quotation marks omitted).
DISCUSSION
Plaintiff asserts a breach of contract claim, which alleges that monies are still due on the
loan Note extended by Norman Webb to Defendant Dan Krudys. ECF No. 1

¶J 8—18. To prevail

on the breach of contract claim, Plaintiff must prove (1) the existence of a contract, (2) breach,
(3) that the claimant performed his own contractual obligations, and (4) damages. frederico v.
Home Depot, 507 F.3d 188, 203 (3d Cir. 2007). Plaintiff contends that the Court should grant
summary judgment because the Note is a simple contract, the amount due is certain, interest and
late fees are calculable, Norman Webb performed his contractual obligations, and the Estate has
been damaged by Defendant’s failure to pay the Note. Ef No. 30-1 at 3—6.
Defendant admits that he has not paid the Note, Bertutti Decl., Ex. H at 13:3-15, but
argues that summary judgment should nonetheless be denied because genuine issues of material
fact remain concerning whether Defendant breached an obligation imposed by the contract, and
whether Plaintiff has been damaged. ECF No. 36 at 4—5. In support of this opposition, Defendant
relies primarily on his testimony that his “Ex-Wife [Ms. Krudys] told him that the Note was paid
from her share of the inheritance,” the August 1, 2014 and July 27, 2015 letters from Scott Webb
to Norman Webb’s heirs addressing distribution of the Estate, and deposit records, which the
Court has previously acknowledged either show that Ms. Krudys received her full inheritance, or
are not relevant. See ECF No 22 at 4—5. Plaintiff responds that none of the evidence offered by
Mr. Krudys creates a genuine issue of material fact. ECF No. 39 at 3—7. The Court agrees.
It is undisputed that on April 1, 2011, Mr. Krudys executed a Note to Norman Webb in
the amount of$150,000. Pl.’s Material Facts, ECF No. 29-1

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¶ 1; Def.’s Response to Pl.’s

NOT FOR PUBLICATION
Material Facts, ECF No. 36-1

¶ 1. The Note was drafted by Defendant’s attorney and there are

no questions surrounding the signing of the Note. ECF No. 29-1

¶J 2—3; ECF No. 36-1 ¶J 2—3.

As specified in the Krudys’ June 2016 divorce agreement, Mr. Krudys remains solely
responsible for any outstanding debt related to the Note. Bertutti Dccl., Ex. F at 12. Defendant
admits that he never personally paid off the Note, ECF No. 36-1
$44,773.92 in payments on the Note. Id.

¶ 12, and that he only made

¶ 8. At bottom, the only dispute present in this lawsuit is

whether the Note was satisfied by a portion of Ms. Krudys’ inheritance such that Mr. Krudy is
not in breach of contract.
Defendant presents no evidence that creates a genuine issue of material fact on the issue
of whether the Note was satisfied by a portion of his ex-wife’s inheritance. The two letters from
Scott Webb to the Norman Webb heirs demonstrate that around August 2014 Ms. Krudys
considered applying her inheritance to Mr. Krudys’ debt, but by July 2015 she had reconsidered.
See Krudys Decl., Ex. A; Bertutti Decl., ECF No. 39-3 at 1.2 Though Mr. Krudys maintains that
Ms. Krudys told him on several occasions “that she would not get her inheritance because of the

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Even if Ms. Krudys had used a portion of her inheritance to reimburse the Estate, both the
August 1, 2014 and July 27, 2015 letters do not suggest that the Estate intended to relinquish Mr.
Krudys’ obligation under the loan Note, thereby eliminating his debt to the Estate. The August 1,
2014 letter reads, in pertinent part, “I had intended to give Cher her full share of my Father’s
Estate because it was my Father who loaned Dan the money. However, after speaking with her
this week she insists on taking it from her inheritance. I will abide by her wishes of course. So
whatever, and whenever, Dan pays the Estate back, that money will be hers to keep.” Krudys
Deci., Ex. A. The July 27, 2015 letter reads: “In the letter I wrote after Dad passed I mentioned
that Cher wanted Dan’s debt taken from her inheritance. I told her that wasn’t necessary since
Dad made the Loan it was the responsibility of the Estate’s. Since then Cher has had a change of
heart (for obvious reasons), so Dan will owe the Estate. If and when Dan pays his debt that will
be distributed to all.” Bertutti Decl., ECF No. 39-3 at 1. Additionally, in his deposition, Scott
Webb reiterated that the Estate did not consider Ms. Krudys’ 2014 offer to forgo her inheritance
a satisfaction of the debt. See Bertutti, Ex. I at 44:3-16. According to Mr. Webb, the Estate
planned to reimburse Ms. Krudys upon Mr. Krudys’ full payment of the Note to the Estate. See
Id.
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Note,” Bertutti Dccl., Ex. H at 13:16—14:4, neither these statements nor Mr. Krudys’ belief that
the Note was paid from Ms. Krudys’ inheritance, id. at 13:16-19, are sufficient to create a
genuine issue of material fact. The only other evidence offered by Mr. Krudys raises the issue of
whether his ex-wife received her full inheritance. See ECF No. 36 at 4—6. The Court has already
stated that this subject does not bear on his defense, ECF No. 22 at 5, and even if it did, Mr.
Krudys offers nothing more than speculation. See Id. at 3—5.
By contrast, the evidence offered by Plaintiff that Ms. Krudys’ inheritance did not go to
satisfy the Note is not meaningfully disputed. Scott Webb, Executor of the Estate has sworn
under oath on multiple occasions that no portion of Ms. Krudys’ inheritance was used to pay the
Note, see e.g., Bertutti Dccl., Exs. G & I at 44:14-6. Ms. Krudys has done so as well, Bertutti
Decl., Ex. J at 39:9-12, and also affirmed that she received her entire inheritance, Id. at 37:10-11.
Deposit records offered by the Estate corroborate Ms. Krudys and Mr. Webb’s deposition
testimony. Bertutti Decl., ECF No. 39-1, Ex. B at 2. Consequently, Plaintiffs motion for
summary judgment is granted.
CONCLUSION
Plaintiff s motion for summary judgment, ECF No. 29, is granted. Plaintiff is also
entitled to an award of reasonable attorney fees and costs, which may be granted for good cause
shown upon separate application. An appropriate order follow

DATE)

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SeniorUrnted States District Court Judge

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