Games v. Cavazos
Citation | 737 F. Supp. 1368 |
Decision Date | 23 May 1990 |
Docket Number | Civ. A. No. 88-516/88-551 MMS. |
Parties | Eric GAMES, Plaintiff, v. Lauro CAVAZOS, Secretary United States Department of Education, in his official capacity, and United Student Aid Funds, Inc., Defendants. |
Court | U.S. District Court — District of Delaware |
O. Randolph Bragg and John X. Denney, Jr. of UAW-GM Legal Services Plan, Newark, Del., for plaintiff.
William C. Carpenter, Jr., U.S. Atty., and Patricia C. Hannigan, Asst. U.S. Atty., Dept. of Justice, Wilmington, Del., for defendant Cavazos.
Kevin G. Healy of Prickett, Jones, Elliott, Kristol & Schnee, Wilmington, Del., for defendant United Student Aid Funds, Inc.
This action is two consolidated cases filed by plaintiff Eric Games against the United States Department of Education ("ED") and United Student Aid Funds, Inc. ("USA Funds"), a guarantee agency participating in the federal Guaranteed Student Loan Program (also known as the Robert T. Stafford Student Loan Program).
In Civil Action No. 88-516, Games alleges both ED and USA Funds committed various procedural due process violations in connection with the involuntary interception and application of his 1987 federal income tax refund towards repayment of his federally guaranteed student loan. Games has moved for summary judgment on his claim. Both defendants have also moved for summary judgment in Civil Action No. 88-516. Civil Action No. 88-551 is a suit by Games against defendant USA Funds for alleged violations of the Federal Debt Collection Practices Act, 15 U.S.C.A. ?? 1692 et seq. Games has moved for partial summary judgment on the merits of his claim. USA Funds has moved for summary judgment in its favor. USA Funds has also filed a counterclaim against Games seeking the outstanding balance of his student loan, interest, costs and attorneys' fees. USA Funds has moved for summary judgment on its counterclaim.
The two cases and the counterclaim were consolidated for all purposes. Stipulated Order of Consolidation (Dkt. 28). The court has jurisdiction pursuant to 28 U.S. C.A. ? 1331. Extensive briefing was filed by the parties, and the court heard oral argument on all motions on March 15, 1990. The court will consider the briefing and evidence submitted by all parties on the various summary judgment motions to be a single summary judgment record.
Federal Rule of Civil Procedure 56(c) provides that summary judgment "shall be rendered forthwith 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." "The filing of cross-motions for summary judgment does not require the Court to grant summary judgment for either party." Krupa v. New Castle County, 732 F.Supp. 497, 512-13 (D.Del.1990) (quoting Rains v. Cascade Industries, Inc., 402 F.2d 241, 245 (3d Cir. 1968)). This is because each party may base its motion on different legal theories involving different material facts. Id., 732 F.Supp. at 513. Further, different reasonable inferences may be drawn from the same facts. When there are no issues of fact and no conflicting inferences, the court may render summary judgment as a matter of law.
A factual dispute between the parties will not defeat a motion for summary judgment unless it is both genuine and material. Anderson v. Liberty Lobby Inc., 477 U.S. 242, 247-48, 106 S.Ct. 2505, 2509-10, 91 L.Ed.2d 202 (1986). A dispute over facts is "material" if, under the substantive law, it would affect the outcome of the suit. Id. at 248, 106 S.Ct. at 2510. A factual dispute is "genuine" if a reasonable jury could return a verdict for the non-movant. Id.
Absent a genuine issue of material fact, summary judgment will be entered "against a party who failed to make a showing sufficient to establish the existence of an element essential to that party's case, and on which that party will bear the burden of proof at trial." Celotex Corp. v. Catrett, 477 U.S. 317, 322, 106 S.Ct. 2548, 2552, 91 L.Ed.2d 265 (1986). The same burdens exist on cross-motions for summary judgment. Peters Tp. School Dist. v. Hartford Acc. & Indem., 833 F.2d 32, 34 (3d Cir.1987).
The "very mission" 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." Fed.R. Civ.P. 56 advisory committee note to the 1963 Amendment. If wisely applied, the summary judgment procedure will eliminate useless trials. 6 J. Moore, W. Taggart & J. Wicker, Moore's Federal Practice ? 56.021 (1988). However, summary judgment is not a substitute for trial and should not be used as a shortcut to avoid trial when a genuine issue of material fact remains in dispute.
The basic factual background of this case is set forth here. Other facts surrounding plaintiff Games' student loan will be discussed in greater detail where relevant.
Plaintiff Games is the recipient of a federally guaranteed student loan under the Robert T. Stafford Student Loan Program. Games applied for a loan in January 1985, Appendix to USA Funds' Opening Brief at A-1-3 (Dkt. 52) (hereinafter cited as "Dkt. 52 at A-____"), and received the loan from Wilmington Trust Company (the "lender") in February 1985 to attend Goldey Beacom College. The loan was guaranteed by defendant USA Funds, a private, not-for-profit corporation which operates as a guarantee agency pursuant to the Higher Education Act, 20 U.S.C.A. ?? 1071 et seq.
Under the terms of the loan, Games was required to begin repayment of the principal six months after the date on which he ceased to be enrolled in college on at least a half-time basis. Promissory Note and Notice of Loan Guarantee and Disclosure Statement, Dkt. 52 at A-2-3. Games' six-month grace period began on May 31, 1985, when plaintiff ceased enrollment at Goldey Beacom College on even a half-time basis. Notice from Goldey Beacom College to Wilmington Trust Co. (Oct. 24, 1985), Appendix to Dept. of Education's Opening Brief in C.A. No. 88-516 at A-14 (Dkt. 48A) (hereinafter "Dkt. 48A at A-____"). Therefore, he should have begun repayment no later than December 1, 1985.
Games failed to make any payments. Plaintiff claims he never received any notices from Wilmington Trust Co. Appendix to Plaintiff's Briefs at A-212 (Dkt. 60) (hereinafter "Dkt. 60 at A-____") (deposition of Eric Games) () . The lender, however, asserts that at least four notices were sent. ED entered copies of four alleged notices into the summary judgment record. Dkt. 48A at A-8-12. However, defendants failed to offer any proof that the notices were in fact mailed.
Wilmington Trust declared the loan in default on May 15, 1986. See Notice of Default, Dkt. 48A at A-7; Letter from Noel C. Burnham, Vice President, Wilmington Trust Co. to Eric Games, Dkt. 60 at A-468. Pursuant to its guarantee obligation, USA Funds paid the defaulted loan ($2615.07) on June 30, 1986, and Wilmington Trust transferred title to the loan to USA Funds. Dkt. 48A at A-1. USA Funds was reimbursed by the ED under its reinsurance agreement with ED. Opening Brief of the Department of Education at 10 (Dkt. 48) (hereinafter "Dkt. 48 at ____"); Dkt. 48A at A-1. In accordance with its contractual obligations with ED, USA Funds conditionally assigned the loan to ED on October 2, 1987. Dkt. 60 at A-45. Also as part of its contractual arrangements with ED, USA Funds generated and sent to Games on USA Funds' letterhead the following form letter ("65-day letter") provided by ED dated October 1, 1987:
Exh. A, Amended Complaint (Dkt. 40) (hereinafter referred to...
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