Jackson Lumber & Millwork Co. v. Rockwell Homes, LLC

• Decision Date: 13 January 2022
• Docket Number: Docket: Yor-21-144
• Citation: Jackson Lumber & Millwork Co. v. Rockwell Homes, LLC, 266 A.3d 288, 2022 ME 4 (Me. 2022)
• Parties: JACKSON LUMBER & MILLWORK CO., INC. v. ROCKWELL HOMES, LLC, et al.
• Court: Maine Supreme Court

266 A.3d 288

2022 ME 4

JACKSON LUMBER & MILLWORK CO., INC.

v.ROCKWELL HOMES, LLC, et al.

Docket: Yor-21-144

Supreme Judicial Court of Maine.

Argued: December 9, 2021

Decided: January 13, 2022

Anthony J. Manhart, Esq.(orally), and Bodie B. Colwell, Esq., Preti Flaherty LLP, Portland, for appellantJackson Lumber & Millwork, Co., Inc.

James F. Molleur, Esq., and Christopher J. Keach, Esq.(orally), Molleur Law Office, Saco, for appelleesRockwell Homes, LLC, Rock Bisson, and Rock Bisson II

Shea H. Watson, Esq.(orally), and Timothy H. Norton, Esq., Kelly Remmel & Zimmerman, Portland, for appelleeAaron Wiswell

Panel: STANFILL, C.J., and MEAD, GORMAN, JABAR, HUMPHREY, HORTON, and CONNORS, JJ.

HUMPHREY, J.

[¶1] In ruling on a motion for approval of attachment and trustee process filed by Jackson Lumber & Millwork Co., Inc., the Superior Court(York County, Douglas, J. ) concluded that because Jackson Lumber was both the mortgagee and the "purchaser at the public sale" of foreclosed property in Lebanon, Maine, the fair market value of that property as established by an independent appraisal—not the value established by the highest bid at the public sale—was used in determining the amount of any deficiency.14 M.R.S. § 6203-E(2021).Jackson Lumber appeals from the court's denial of its motion for approval of attachment and trustee process in the amount of $620,942.63 against the real and personal property of mortgagor Rockwell Homes, LLC, and individual guarantors Rock Bisson, Rock Bisson II, and Aaron Wiswell, arguing that the court erred in treating Jackson Lumber as the "purchaser at the public sale" of the property when it had assigned its rights under the purchase and sale agreement to another entity and was not the party that received the deed.¹We affirm the court's order denying Jackson Lumber's motion.

I.BACKGROUND

[¶2] The facts found by the court in reaching its decision are, except as noted, supported by the affidavits and attached exhibits submitted in conjunction with the motion for approval of attachment and trustee process.SeeLibby O'Brien Kingsley & Champion, LLC v. Blanchard , 2015 ME 101, ¶ 5, 121 A.3d 109.In September 2017, Rockwell Homes borrowed $1,300,000 from Jackson Lumber to acquire real property in Lebanon.The loan was secured by a mortgage on the property, and Wiswell executed a promissory note on behalf of Rockwell Homes.The note also included personal guaranties executed by the Bissons and Wiswell.Rockwell Homes defaulted on the note in September 2018.

[¶3] In January 2019, the CEO and treasurer of Jackson Lumber sent emails to Wiswell informing him that the balance due on the loan was $1,041,026.95 and that an appraisal showed the Lebanon property against which that debt was secured had an "as is" value of $1,100,000.In March 2019, Jackson Lumber provided notice of default and demanded payment in full of all amounts due on the note secured by the Lebanon property—the sum of $1,070,918.37.²

[¶4] On April 22, 2019, acting pursuant to 14 M.R.S. § 6203-A(2021), Jackson Lumber provided notice to Rockwell Homes, the Bissons, and Wiswell of its intention to foreclose on the mortgage by public sale of the Lebanon property on May 23, 2019.The public sale was conducted as scheduled, and Jackson Lumber was the highest bidder at $550,000.Jackson Lumber executed a purchase and sale agreement naming itself as both the seller and "Purchaser" of the Lebanon property.

[¶5] On July 15, 2019, Jackson Lumber assigned its rights under the purchase and sale agreement to Robert DiBerto in exchange for $600,000.DiBerto then assigned his rights to Agamenticus Holdings, LLC, and on August 15, 2019, Jackson Lumber conveyed the property to Agamenticus.

[¶6]Jackson Lumber filed a complaint in the Superior Court on November 25, 2019, seeking monetary damages, attorney fees, and costs based on claims for a deficiency judgment against Rockwell Homes and for enforcement of the individual guaranties of the Bissons and Wiswell.Jackson Lumber simultaneously moved for approval of attachment and trustee process against all defendants.It filed a draft order and the affidavit of its chief executive officer and treasurer, who authenticated and attached documentary exhibits.All defendants opposed the motion for approval of attachment and trustee process.Rock Bisson and Wiswell attached their own affidavits with exhibits.Jackson Lumber filed a reply memorandum and a supplemental affidavit from its CEO and treasurer.

[¶7]The court held a nontestimonial hearing in April 2021 and entered an order denying the motion for approval of attachment and trustee process as to the claims for deficiency against Rockwell Homes and for enforcement of the guaranties of the Bissons and Wiswell on the mortgage note for the Lebanon property.The court reasoned that Jackson Lumber had not established a likelihood of success on the merits because when the mortgagee is the "purchaser at the public sale" of the mortgaged premises, the amount of the deficiency must be determined by comparing the amount owed with the fair market value of the property at the time of the sale, as established by an independent appraisal.14 M.R.S. § 6203-E.The court regarded mortgagee Jackson Lumber as the "purchaser at the public sale" and concluded that there was no recoverable deficiency given that the appraised value of the Lebanon property ($1,100,000) exceeded the amount owed by Rockwell Homes at the time of the foreclosure ($1,070,918.37).Id.

[¶8]Jackson Lumber timely appealed from the denial of its motion for approval of attachment and trustee process as to the claims for a deficiency owed on the Lebanon property and for the enforcement of the individual guaranties of the Bissons and Wiswell.See14 M.R.S. § 1851(2021);M.R. App. P. 2B(c)(1);Sweeney v. Hope House, Inc. , 656 A.2d 1215, 1216(Me.1995)("An order denying a motion for approval of attachment and trustee process is immediately appealable as an exception to the final judgment rule.").

II.DISCUSSION

[¶9]We review a decision to deny approval of attachment and trustee process for an abuse of discretion or clear error.SeeSweeney , 656 A.2d at 1216.We will disturb the trial court's findings based on the affidavits only if "the affidavits contain no competent evidence to support the finding as to the plaintiffs’ likelihood of success."Blanchard , 2015 ME 101, ¶ 5, 121 A.3d 109(quotation marks omitted).

[¶10] Issues of statutory interpretation are, however, reviewed de novo, and the fundamental issue on appeal here is the interpretation of the term "purchaser at the public sale" in 14 M.R.S. § 6203-E.SeeFleet Nat'l Bank v. Liberty , 2004 ME 36, ¶ 5, 845 A.2d 1183.In interpreting a statute, we"look to the plain meaning of the statute, interpreting its language to avoid absurd, illogical or inconsistent results and attempting to give all of its words meaning."Thurston v. Galvin , 2014 ME 76, ¶ 13, 94 A.3d 16(quotation marks omitted).In doing so, we view"the relevant provisions in the context of the entire statutory scheme to generate a harmonious result."Corinth Pellets, LLC v. Arch Specialty Ins. Co. , 2021 ME 10, ¶ 19, 246 A.3d 586(quotation marks omitted).If a statute is unambiguous, we interpret the statute directly without examining legislative history; we"look to legislative history and other extraneous aids in interpretation of a statute only when we have determined that the statute is ambiguous," meaning that it "is reasonably susceptible to different interpretations."Thurston , 2014 ME 76, ¶ 13, 94 A.3d 16(quotation marks omitted).

[¶11] The relevant paragraph of section 6203-E provides, "In the event that the mortgagee is the purchaser at the public sale , any deficiency is limited to the difference between the fair market value of the premises at the time of the sale, as established by an independent appraisal, and the sum due the mortgagee with interest plus the expenses incurred in making the sale."(Emphasis added.)This stands in contrast to the ordinary determination of a deficiency by comparing the sale price with the sum owed to the mortgagee and adding interest and expenses.See14 M.R.S. § 6203-E;cf.14 M.R.S. § 6323(2021)(providing, in the statute governing public sales in foreclosures by civil action,³ that "[a]ny rights of the mortgagee to a deficiency claim against the mortgagors are limited to the amount established as of the date of the public sale.The date of the public sale is the date on which bids are received to establish the sales price, no matter when the sale is completed by the delivery of the deed to the highest bidder.").

[¶12] Thus, when "(1) the mortgagee is the purchaser at the public sale and (2) the mortgagee seeks a deficiency judgment," the deficiency is determined based on a comparison of the fair market value at the time of the public sale, as established by an independent appraisal, with the amount owed to the mortgagee.Key Bank of Me. v. Holman , 657 A.2d 775, 776(Me.1995)(construing the comparable provision in the statute governing a public sale ordered in a foreclosure by civil action).At issue here is whether Jackson Lumber was the "purchaser at the public sale" even though it did not ultimately acquire the property because it later assigned away its rights under the purchase and sale agreement and never received the deed.14 M.R.S. § 6203-E.

[¶13] The term "purchaser," viewed in isolation, means "[s]omeone who obtains property for money or other valuable consideration; a buyer."Purchaser , Black's Law Dictionary(11th ed. 2019).The statutory term "purchaser at the public sale" has its own meaning, however, based on its usage in the statutory scheme.For instance, 14 M.R.S. § 6203-A(5) requires that a purchase and sale agreement be executed "[a]t the completion of a public sale," after which the agreement "may be assigned by the purchaser ."⁴(Emphasis added.)That the "purchaser" is authorized to assign the...