Deem et al v. Baron et al
Filing
368
MEMORANDUM DECISION: granting in part and denying in part 358 Motion to Amend/Correct; granting in part and denying in part 359 Motion to Alter Judgment. The court orders defense counsel to prepare the amended judgment based on this ruling and the court's ruling ECF 365 and ECF 366, and present it to Plaintiffs for approval before submitting it to the Court for final entry and resolution in full of this case, to assure the proper adjustment of the final amounts due and owing among the numerous different parties in this case. Signed by Judge David Sam on 08/03/2020. (kpf)
Case 2:15-cv-00755-DS Document 368 Filed 08/03/20 PageID.9824 Page 1 of 6
UNITED STATES DISTRICT COURT
DISTRICT OF UTAH, CENTRAL DIVISION
DARRELL L. DEEM, et. al.,
MEMORANDUM DECISION
Plaintiffs,
v.
2:15-CV-00755-DS
TRACEY BARON, et. al.,
District Judge David Sam
Defendants.
Plaintiffs have filed two related post-judgment motions: (1) Plaintiffs’ Motion to Amend
Findings of Fact and Conclusions of Law (ECF 358); and (2) Plaintiffs’ Motion to Amend or
Alter Judgment (ECF 359). The second of these two motions is dependent on the first; i.e., the
relief sought in Plaintiffs’ Motion to Amend or Alter Judgment is expressly premised on the
court’s first granting Plaintiffs’ Motion to Amend Findings of Fact and Conclusions of Law.
Consequently, the court will address both motions jointly in this Memorandum Decision.
The purpose of a Rule 52(b) motion is “to correct manifest errors of law or fact, or, in
some limited situations, to present newly discovered evidence.” Lyons v. Jefferson Bank & Tr.,
793 F.Supp. 989, 991 (D. Colo. 1992) (Citing Fontenot v. Mesa Petrolueum Co., 791 F.2d 1207,
1219 (5th Cir. 1986). Such a motion should not be employed, however, “to introduce new
evidence that was available at the time of trial but was not proffered, to advance new theories, or
to secure a rehearing on the merits.” Id. Blessed with the acuity of hindsight, [a party] may now
realize that it did not make its initial case as compelling as it might have, but it cannot charge the
district court with responsibility for that failure through this Rule 52(b) motion.’” Id. (quoting
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Fontenot, 791 F.2d at 1220. The court has specifically rejected claims repeated here. Postjudgment motions are not appropriate to revisit issues already addressed.
A. Date on which the equitable mortgage was awarded
Plaintiffs request that the court identify the specific date on which the equitable mortgage
awarded to David Law and Darrell Deem began. They argue that this is necessary to define the
rights of the equitable mortgage, particularly as against other lien holders. The start date is the
date the equitable mortgage was created by the parties, which in this case is the date of the Joint
Venture Agreement, December 16, 2013. ECF 367, Exhibit A. See Hoxworth v. Blinder, 170
B.R. 438, 442-44 (D. Colo. 1994), aff’d, 74 F.3d 205 (10th Cir. 1996) (Even though judicially
recognized at a later date, equitable lien relates back to time it was created by conduct of the
parties). The court grants this request and hereby amends the equitable mortgage on the Hilltop
property to match the date of the Joint Venture Agreement (“JVA”), December 16, 2013.
B. Property taxes paid by David Law
To protect his interest in the Hilltop property, David Law paid property taxes in the
amount of $13,145.56 and insurance in the amount of $2,396.21. ECF 306, p. 40 ¶ 43. The court
awarded judgment in favor of David Law and against Tracey Baron and Michelle Baron for this
amount. ECF 325, p. 4, ¶ 8. The court is not opposed to amending the judgment to include that
amount in the equitable mortgage amount as requested by Plaintiffs.
C. Federal Tax Liens
Plaintiffs suggest that the value of any state or federal tax liens be included in
their equitable mortgage. They point out that the court’s ruling reflects only the monetary
consideration of the breaches of contract without considering the equitable effect such breaches
Case 2:15-cv-00755-DS Document 368 Filed 08/03/20 PageID.9826 Page 3 of 6
have on maintaining Plaintiff’s right in equity. On December 16, 2013, Michelle and Tracey
Baron promised in the JVA to pay insurance, property taxes, and to not permit further
encumbrances. There remains an amount of $36,095.02 in delinquent and unpaid property taxes.
ECF 306, p. 14, ¶ 54. The court finds that it was error not to include one half of the outstanding
property tax value ($18,047.63) to David Law’s equitable mortgage and one half to Darrell
Deem’s equitable mortgage.
Thus, Michelle Baron’s equitable ownership of the Hilltop property is hereby amended to
be “[s]ubject to an equitable mortgage in favor of David G. Law in the sum of $281,589.40 and
Darrell L. Deem in the sum of $266,047.63, for a total sum of $547,637.03, to secure these
amounts owed to them by Michelle Baron.”
D. Prejudgment interest
The court rejects Plaintiffs’ request to add more prejudgment interest. The court has
twice determined the interest question that they are now raising. The law of the case doctrine “is
designed to promote finality and prevent re-litigation of previously decided issues . . . .” Rimbert
v. Eli Lilly & Co., 647 F.3d 1247, 1251 (10th Cir. 2011). “When law of the case doctrine applies,
three circumstances generally warrant departure from the prior ruling: (1) new and different
evidence; (2) intervening controlling authority; or (3) a clearly erroneous prior decision which
would work a manifest injustice.” Id. None of the exceptions identified in Tenth Circuit case law
applies to allow the court to revisit the prejudgment interest issue a third time.
The court determined in its findings and conclusions that no interest would be appropriate
because the Hilltop JVA was not a loan agreement. The court specifically did not award interest
on the amounts invested but instead ordered their return. Before entry of the judgement, the
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Plaintiffs asked the court to reconsider this ruling. The court—specifically noting that the
amounts underlying the equitable mortgage were an obligation in favor of Plaintiffs and
awarding post-judgment interest—declined to award pre-judgement interest on the equitable
mortgage amounts. ECF 325, p. 3, ¶ 6. The issue has already been addressed and decided.
Plaintiffs do not point to new and different evidence, intervening controlling authority, or a
clearly erroneous prior decision that would work a manifest injustice.
E. Contract damage determinations under the loan transaction agreements
The court dealt thoroughly and exhaustively with the issue of contract damages for the
Loan Transaction Agreements in its Findings of Fact and Conclusions of Law. ECF 306, pp. 2531, ¶¶ 5-20; id. Pp. 57-58, ¶¶ 1-3, 6-7. Plaintiffs have shown no reason to disturb those findings
and conclusions. The court heard and considered all the evidence and properly applied the law.
Plaintiffs merely emphasize some items of evidence from the voluminous trial record over
others, ignoring what the court actually reasoned in connection with this issue. The court’s
findings and conclusions on damages accurately reflect the weight of the evidence at trial in light
of the governing law. Plaintiffs were awarded damages, and in fact received a substantial award
of attorney fees based thereon. ECF 360.
F. False pretenses
Plaintiffs’ request that the court conclude that Tracey Baron and all entities under the
Supplemental Loan Agreements (“SLAs”) took monies under false pretense. The court
considered and rejected the non-contract claims based on the testimony and other evidence at
trial and especially in light of the legal standard requiring proof by clear and convincing
evidence. ECF 306, pp. 5-7, 44-48. Plaintiffs fail to address that standard when making their
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argument. As the court stated in its findings and conclusions, “This case is a contract case first
and foremost, and the Plaintiffs have not clearly and convincingly demonstrated otherwise.” ECF
306, p. 46, ¶15-22, 53-62.
Plaintiffs argue that false pretenses related to alleged “personal guarantees” made by
Tracey Baron. In their proposed findings and conclusions, however, Plaintiffs asked the court
specifically to enter a finding that “Tracey Baron did not personally guaranty any of the
Promissory Notes or Supplemental Loan Agreements.” ECF 302, p. 26, emphasis added. Before
entry of judgment, they did not ask the court to make any findings and conclusions related to
fraud based on alleged personal guaranties. They can advance no post-judgment argument for the
first time on this basis.
Conclusion
Based on the above and good cause appearing, the court hereby grants in part and denies
in part Plaintiffs’ Motion to Amend Findings of Fact and Conclusions of Law (ECF 358) as
follows. The court amends the equitable mortgage awarded to David Law and Darrell Deem on
the Hilltop property to identify the start date as December 16, 2013. The court also amends the
Plaintiffs’ equitable mortgage to include an amount of $15,541.77 in property taxes paid by Mr.
Law to protect his interest in Hilltop, and an amount of $36,095.02 in delinquent and unpaid
property taxes. The court denies, however, any additional award of prejudgment interest. The
court also denies Plaintiffs’ request for additional contract damages under the loan transaction
agreements.
Based on the above, the court hereby grants in part Plaintiffs’ Motion to Amend or Alter
Judgement (ECF 359), as follows:
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5. “[s]ubject to an equitable mortgage, in favor of David G. Law in the
sum of $281,589.40 and Darrell L. Deem in the sum of $266,047.63, for a total
sum of $547,637.03, to secure these amounts owed to them by Michelle Baron.”
6. Judgment . . . for the total sum of $281,589.40 for David G. Law and
$266,047.63 for Darrell L. Deem each ($547,637.03 total).
8. Omit
The court denies the remainder of Plaintiff’s Motion.
The court orders defense counsel to prepare the amended judgment based on this
ruling and the court’s rulings in ECF 365 and ECF 366, and present it to Plaintiffs for
approval before submitting it to the Court for final entry and resolution in full of this
case, to assure the proper adjustment of the final amounts due and owing among the
numerous different parties in this case.
SO ORDERED.
DATED this
3rd day of August, 2020.
BY THE COURT:
DAVID SAM
United States District Judge
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