Commonwealth Land Title Ins. Co. v. Koosyial (In re Suresh Koosyial XXX-Xx-1867)
| Decision Date | 08 January 2016 |
| Docket Number | Adversary No. 14-1009,Case No. 14-10382 |
| Parties | IN RE: SURESH KOOSYIAL xxx-xx-1867 Debtor COMMONWEALTH LAND TITLE INSURANCE COMPANY Plaintiff v. SURESH KOOSYIAL Defendant |
| Court | U.S. Bankruptcy Court — Eastern District of Texas |
ON THIS DATE the Court considered the Motion for Summary Judgment filed by the Plaintiff, Commonwealth Land Title Insurance Company ("Commonwealth" or "Plaintiff"), in the above-referenced adversary proceeding. The Defendant, Suresh Koosyial ("Defendant" or "Debtor"), failed to file a response in opposition to the Motion filed by the Plaintiff.1 The Plaintiff's complaint seeks: (1) a judgment for an alleged debt of $112,035.33, together with interest, costs, and an award of reasonable and necessary attorney's fees; and (2) a determination that such a debt owed by the Defendant to the Plaintiff is nondischargeable as a liability for obtaining money or property by false pretenses, a false representation, or actual fraud.
Upon due consideration of the pleadings, the proper summary judgment evidence submitted by the parties, and the relevant legal authorities, the Court concludes that the Plaintiff has failed to demonstrate the existence of one or more essential elements of its claim, thus precluding any judgment as a matter of law that any debt owed to it by the Defendant is nondischargeable under 11 U.S.C. §523(a)(2)(A).2
The material facts giving rise to this action are not in dispute. In 2003, the Defendant, Suresh Koosyial, owned certain improved real property located at 101-06 81st Street, Ozone Park, Queens, New York (the "Queens Property").4 On November 4, 2003, the Defendant executed a promissory note in the amount of $100,000.00 payable to Citibank, N.A. ("Citibank").5 To secure the payment of that promissory note, the Defendant granted Citibank a mortgage on the Queens Property.6
On or about May 12, 2004, the Defendant sold the Queens Property to Kishore C. and Chandrawatie Charles via special warranty deed.7 As a component of that sale, the Defendant executed an affidavit "to induce Accredited Home Lenders to accept a mortgage on or a conveyance of said premises and to induce American Pioneer Title Insurance Company/Fidelity National Title Insurance Company to issue a policy of title insurance . . . covering said premises."8 That affidavit contained representations by the Defendant including that the conveyance "is not done for the purpose of defrauding any creditors, liens or any other party who may claim an interest in the subject premises" and that "I/we have not entered into any private agreements with the Purchaser, seller, lender, additional third party regarding financing, mortgages, purchase, sale, refinance agreements which may affect our current mortgage, this transaction or my/our ability to obtain financing for this property."9
For unexplained reasons, the title examination conducted prior to the closing of the May 2004 sales transaction failed to disclose the existence of the Defendant's mortgage with Citibank. As a result, no portion of the proceeds arising from the May 2004 sales transaction was tendered in satisfaction of the mortgage held by Citibank against the Queens Property.10
The Queens Property was subsequently sold by Mr. and Mrs. Charles to Mohammed A. Hadi and Mohammed L. Kahn ("Hadi & Kahn"). As a part of that sales transaction, the Plaintiff underwrote an owner's policy of title insurance for the benefit of Hadi & Kahn as the purchasers of the Queens Property, under which the Plaintiff insured for the benefit of Hadi & Kahn that the Queens Property was free of any liens and encumbrances. Hadi & Kahn were still the record title holders in February 2009 when, after the Defendant had defaulted on his note payments, Citibank initiated a judicial foreclosure proceeding in the Supreme Court of Queens County, New York against all affected parties, including the Defendant and Hadi & Kahn, seeking to foreclose its mortgage lien against the Queens Property.11
Hadi & Kahn subsequently made a claim under their title insurance policy issued by the Plaintiff and the Plaintiff was contractually bound to provide the purchasers with a defense to the Citibank lawsuit.12 Ultimately, the Plaintiff, in providing a defense for Hadi & Kahn, reached a settlement with Citibank whereby the Plaintiff paid the sum of $112,035.33 to Citibank in October 2010 and thereby received an assignment of the Citibank note and mortgage.13 The Plaintiff is the current holder of the original 2003 Citibank note executed by the Defendant.14
After receiving the assignment of the note and mortgage from Citibank, the Plaintiff filed a state court lawsuit against the Defendant in March 2014 in the Supreme Court of Queens County, New York, seeking to recover from the Defendant the amounts that it had paid to Citibank.15 Prior to any resolution of that state court lawsuit, the Defendant filed a voluntary petition for relief under Chapter 7 of the Bankruptcy Code in this Court.
On November 6, 2014, the Plaintiff filed the present complaint against the Defendant, contending that: (1) representations made by the Defendant in the 2004 sales transaction to Mr. and Mrs. Charles regarding existing encumbrances were knowingly false; (2) the Defendant is thereby liable for the $112,035.33 which the Plaintiff eventually paid in 2010 under its title policy obligations to Hadi & Kahn, as subsequent purchasers of the Queens Property; and (3) such 2004 false representations render the alleged debt nondischargeable under §523(a)(2)(A). On October 2, 2015, the Plaintiff filed its motion for summary judgment — arguing that, as a matter of law, it is entitled to judgment on its complaint. No response in opposition to the Plaintiff's motion for summary judgment has been filed by the Defendant.
The Plaintiff brings its Motion for Summary Judgment in this adversary proceeding pursuant to Federal Rule of Bankruptcy Procedure 7056.16 That rule incorporates Federal Rule of Civil Procedure 56 which provides that summary judgment shall be rendered "if 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 that the moving party is entitled to judgment as a matter of law."17 The party seeking summary judgment always bears the initial responsibility of informing the court of the basis for its motion, identifying those portions of the "pleadings, depositions, answers to interrogatories, and affidavits, if any," which it believes demonstrates the absence of a genuine issue of material fact.18 The moving party asserting that a fact cannot be genuinely disputed must support that assertion by:
The manner in which the necessary summary judgment showing can be made depends upon which party will bear the burden of persuasion at trial. If, as in this case, the burden of persuasion is on the moving party, "that party must support its motion with credible evidence-using any of the materials specified in Rule 56(c)-that would entitle it to a directed verdict if not controverted at trial."19
If a summary judgment motion is properly supported, a party opposing the motion may not merely rest upon the contents of its pleadings, but rather must demonstrate in specific responsive pleadings the existence of specific facts constituting a genuine issue of material fact for which a trial is necessary.20 The substantive law will identify which facts are material.21 In its objection, the non-movant must show more than a "mere disagreement" between the parties,22 or that there is merely "some metaphysical doubt as to the material facts."23 Neither are unsubstantiated, conclusory assertions in the response sufficient to raise a genuine issue of material fact.24 However, "[t]he issue of material fact which must be present in order to entitle a party to proceed to trial is not required to be resolved conclusively in favor of the party asserting its existence; rather, all that is required is that sufficient evidence supporting the claimed factual dispute be shown to require a jury or judge to resolve the parties' differing versions of the truth at trial."25
The record presented is reviewed in the light most favorable to the non-moving party.26 "Where the record taken as a whole could not lead a rational trier of fact to find for the non-moving party, there is no 'genuine issue for trial.'"27 Further, "[o]nly disputes over facts that might affect the outcome of the suit under the governing law will properly preclude the entry of summary judgment."28
In addition to the Rule 56 procedures outlined above, the requirements of Local District Court Rule CV-56 were also invoked by the Court for the content and determination of summary judgment motions.29 That rule, in relevant part, directs a movant to include a Statement of Undisputed Material Facts and to support such a statement with "appropriate citations to proper summary judgment evidence."30 It directs a respondent that any response "should be supported by appropriate citations to proper summary judgment evidence."31 With regard to the disposition of the motion, the rule states:
(c) Ruling. In resolving the motion for summary judgment, the court will assume that the facts as claimed and supported by admissible evidence...
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