In re Cahillane, Case No. 04-65210 JPK (Bankr.N.D.Ind. 3/11/2009), Case No. 04-65210 JPK.
| Decision Date | 11 March 2009 |
| Docket Number | Adversary No. 05-6144.,Case No. 04-65210 JPK. |
| Parties | IN RE: THOMAS JOSEPH CAHILLANE, Chapter 7, Debtor. GORDON E. GOUVEIA, TRUSTEE, Plaintiff, v. TC INVESTMENTS, LLC, CHARLES R. SPARKS, and RONALD K NABHAN, Defendants. |
| Court | United States Bankruptcy Courts. Seventh Circuit. U.S. Bankruptcy Court — Northern District of Indiana |
This Memorandum of Decision determines the Motion for Summary Judgment filed by the defendants TC Investments, LLC ("TC Investments"), Charles R. Sparks ("Sparks") and Ronald K Nabhan ("Nabhan") on February 28, 2008.
This adversary proceeding was initiated by a complaint filed by Gordon E. Gouveia, Chapter 7 Trustee of the Chapter 7 bankruptcy estate of Thomas Joseph Cahillane under case number 04-65210 ["Trustee"], on August 15, 2005. The designated defendants were TC Investments, Sparks and Nabhan. The defendants filed their answer to the complaint on September 14, 2005. On October 6, 2006, the plaintiff filed a motion for leave to file an amended complaint, which was granted by the court's order entered on December 28, 2006. The amended complaint authorized by that order was filed on December 27, 2006. On March 23, 2007, the court entered its Order of Consolidation Into Adversary Proceeding, which consolidated, by agreement of the parties, a contested matter arising from the Motion to Reject Executory Contract or in the Alternative Lift of Automatic Stay filed by the defendants on February 16, 2007, with adversary proceeding number 05-6144. The March 23, 2007 order thus combined two separate requests for relief by the defendants — a motion for relief from stay and a motion to compel the Trustee to reject an executory contract — into this adversary proceeding. That order further provided that the respective requests for relief by the defendants would be deemed to be in the nature of counterclaims asserted in the adversary proceeding, and that the Objection to Motion to Reject Executory Contract, or Alternatively, to Lift the Automatic Stay filed by the plaintiff on March 8, 2007 would be deemed to be in the nature of an answer to those two requests for relief.
On January 18, 2007, defendants TC Investments, Sparks and Nabhan filed their answer to the amended complaint. The pleadings were closed on the record by the filing of that answer. Multiple skirmishes followed between the parties — none of which are pertinent to the matter at hand before the court, i.e., the defendants' motion for summary judgment. On December 28, 2007, the court entered its Order Regarding Further Proceedings. This order reluctantly granted the defendants' request to submit this matter to the court by means of the defendants' motion for summary judgment. The order in pertinent part provided:
IT IS ORDERED that the defendants shall file their motion for summary judgment in accordance with Fed.R.Bankr.P. 7056/Fed.R.Civ.P. 56/N.D.Ind.L.B.R. B-7056-1 by February 29, 2008; that the response of the plaintiff, in the manner provided by Fed.R.Bankr.P. 7056/Fed.R.Civ.P. 56/N.D.Ind.L.B.R. B-7056-1 shall be filed by April 30, 2008; and that any reply by the defendants to the plaintiff's response shall be filed by May 30, 2008.
The defendants filed their motion for summary judgment and supporting materials on February 28, 2008; the plaintiff filed his response to that motion and supporting materials on April 30, 2008, on May 1, 2008 and on May 6, 2008. More skirmishes followed. On June 27, 2008, the court entered its Order Regarding Pending Motions by which the record on the defendants' motion for summary judgment was established. Pursuant to that order, the record before the court with respect to the motion for summary judgment filed by the defendants on February 28 2008 is the following:
1. The defendants' Motion for Summary Judgment, together with its supporting materials, filed on February 28, 2008;
2. The Response to Defendants' Motion for Summary Judgment, filed by the plaintiff as record entry #92 on April 30, 2008;
3. The plaintiff's "Trustee's Appendix of Designated Evidence" filed on May 1, 2008 as docket record entry #93;
4. The plaintiff's Memorandum in Support of Response to Defendants' Motion for Summary Judgment filed by the plaintiff on May 6, 2008 as record entry #95;
5. That portion of record entry #99, filed on May 30, 2008 by the defendants, which is comprised of sub-file #1 with respect to that filing — the evidentiary material otherwise submitted with that filing apart from sub-file #1 is not part of the record in this summary judgment proceeding.1
The procedural mechanism of summary judgment is provided by Rule 56 of the Federal Rules of Civil Procedure, made applicable to adversary proceedings by Fed.R.Bankr.P. 7056. The principal standard to be followed by the Court in determining a motion for summary judgment is stated as follows in Fed.R.Civ.P. Rule 56(c):
The judgment sought 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 a judgment as a matter of law.
The summary judgment procedure is intended to be an efficient shortcut for final determination of claims or defenses in a case. As stated in Celotex Corporation v. Catrett, 106 S.Ct. 2548, 2555 (1986):
The Federal Rules of Civil Procedure have for almost 50 years authorized motions for summary judgment upon proper showings of the lack of a genuine, triable issue of material fact. Summary judgment procedure is properly regarded not as a disfavored procedural shortcut, but rather as an integral part of the Federal Rules as a whole, which are designed "to secure the just, speedy and inexpensive determination of every action." Fed.Rule Civ.Proc. 1; see Schwarzer, Summary Judgment Under the Federal Rules: Defining Genuine Issues of Material Fact, 99 F.R.D. 465, 467 (1984). Before the shift to "notice pleading" accomplished by the Federal Rules, motions to dismiss a complaint or to strike a defense were the principal tools by which factually insufficient claims or defenses could be isolated and prevented from going to trial with the attendant unwarranted consumption of public and private resources. But with the advent of "notice pleading," the motion to dismiss seldom fulfills this function any more, and its place has been taken by the motion for summary judgment. Rule 56 must be construed with due regard not only for the rights of persons asserting claims and defenses that are adequately based in fact to have those claims and defenses tried to a jury, but also for the rights of persons opposing such claims and defenses to demonstrate in the manner provided by the Rule, prior to trial, that the claims and defenses have no factual basis.
The inquiry that the court must make is whether the evidence presents a sufficient disagreement to require trial or whether one party must prevail as a matter of law. Anderson v. Liberty Lobby, 106 S. Ct. 2505, 2509-10 (1986). In deciding a Motion for Summary Judgment, the Court should not "weigh the evidence." Anderson, 477 U.S. at 249, 106 S. Ct. at 2510-11; Illinois Bell Telephone Co. v. Haines and Co., Inc., 905 F.2d 1081, 1087 (7th Cir. 1990). However, "if evidence opposing a summary judgment is merely colorable, or is not significantly probative, summary judgment may be granted." Anderson, 106 S. Ct. at 2511; Trautvetter v. Quick, 916 F.2d 1140, 1147 (7th Cir. 1990).
The moving party bears the burden of showing that there is an absence of evidence to support the non-movant's case; Celotex Corp. v. Catrett, 106 S. Ct. at 2548, 2554 (1986), i.e., the lack of a genuine issue of material fact. Big O Tire Dealers, Inc. v. Big O Warehouse, 741 F.2d 160, 163 (7th Cir. 1984); Korf v. Ball State University, 726 F.2d 1222, 1226 (7th Cir. 1984). However, when challenged by a summary judgment motion, the proponent of affirmative relief thus challenged is "put to the test", so to speak, and must demonstrate a prima facie claim for relief in order to survive the motion. As stated by the Supreme Court in Celotex, supra., 106 S.Ct. at 2552-2553:
In our view, the plain language of Rule 56(c) mandates the entry of summary judgment, after adequate time for discovery and upon motion, against a party who fails 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. In such a situation, there can be "no genuine issue as to any material fact," since a complete failure of proof concerning an essential element of the nonmoving party's case necessarily renders all other facts immaterial. The moving party is "entitled to a judgment as a matter of law" because the nonmoving party has failed to make a sufficient showing on an essential element of her case with respect to which she has the burden of proof. "[T]h[e] standard [for granting summary judgment] mirrors the standard for a directed verdict under Federal Rule of Civil Procedure 50(a)...." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 250, 106 S.Ct. 2505, 2511, 91 L.Ed.2d 202 (1986).
Of course, a party seeking summary judgment always bears the initial responsibility of informing the district court of the basis for its motion, and identifying those portions of "the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any," which it believes demonstrate the absence of a genuine issue of material fact. But unlike the Court of Appeals, we find no express or implied requirement in Rule 56 that the moving party support its motion with affidavits or other similar materials negating the opponent's claim. On the contrary, Rule 56(c), which refers to ...
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