Miller v. Conte
| Decision Date | 28 October 1999 |
| Docket Number | No. 1:99-CV-0017.,No. 1:99-CV-149.,1:99-CV-0017.,1:99-CV-149. |
| Citation | 72 F.Supp.2d 952 |
| Parties | Ward W. MILLER Plaintiff, v. Samuel S. CONTE, et al., Defendants. United States of America Plaintiff, v. Samuel S. Conte, et al., Defendants. |
| Court | U.S. District Court — Northern District of Indiana |
Kevin P. Jenkins, U.S. Dept. of Justice, Washington, DC, for United States of America, plaintiffs.
James T. Young, Warsco Brogan and Strunk, Fort Wayne, IN, for Samuel S. Conte, Carol S. Conte, defendants.
Peter Conte, Milwaukee, WI, pro se.
Ward W. Miller, Bloom Bloom More and Miller, Fort Wayne, IN, pro se.
Ken Miller, Indiana Department of Revenue, Indianapolis, pro se.
This cause is before the court upon cross-motions for partial summary judgment filed by plaintiff, Ward W. Miller ("Miller") and the United States of America ("United States" or "the Government") filed on September 23, 1999. The Government filed its response to Miller's motion on October 12, 1999. Miller filed no response and notified the court that no reply to the Government's motion would be forthcoming. Accordingly, the motions are ripe for consideration.
For the following reasons, Miller's Motion for Partial Summary Judgment will be DENIED. The Government's Motion for Partial Summary Judgment will be GRANTED.
To facilitate this court's efforts in resolving the pending motions, on August 25, 1999 the parties filed their "Stipulation of Fact Between Miller, Trustee, and the United States for Purposes of Partial Summary Judgment Motions." The following facts are taken from this filing:
Defendant, Samuel S. Conte, ("the Debtor or Conte") controlled the now-defunct entity Import & Mini Car Parts, Ltd. ("Import") before and during the time it was in Chapter 11 bankruptcy. While it was in Chapter 11, the corporation failed to pay the United States the appropriate employment taxes, in addition to various state taxes and other administrative obligations. At all applicable times, Conte has been a resident of Allen County, Indiana, and his wife, Carol Conte, is not a debtor of either plaintiff.
On or about February 19, 1985 ("February 1985 Lien"), the United States duly assessed an unpaid federal trust fund recovery penalty against Conte for the unpaid withholding taxes of Import for the period ending June 30, 1984. On or about August 10, 1987 ("August 1987 Lien"), the United States made an additional assessment for federal trust fund recovery penalties against Conte for unpaid withholding taxes for the period ending December 21, 1985. The United States gave proper notice of the assessment and demand for payment to Conte, but he did not timely satisfy the obligations.
As a result of Conte's tax liabilities, the Internal Revenue Service caused the following tax lien notices, refiling of tax lien notices, or correction to a filed tax lien notice, to be recorded with the recorder of Allen County, Indiana:
RECORDING DATE DOCUMENT NO. AMOUNT
5/17/85 85-12282 $28,230.89
6/07/85 85-14363 $28,230.89
2/16/88 88-005357 $20,632.37
2/12/91 91-005332 $28230.89 (re-filing)
2/12/91 91-005333 $28,230.89 (re-filing)
6/30/93 93-036613 $20,632.37 (correction)
The re-filing of the notices of federal tax liens dated 5/17/85, 6/07/85 and 2/16/88 were timely as required by 26 U.S.C. § 6323(g)(3). At no time did the United States file any notices of tax liens with respect to Conte with the clerk of the United States District Court for the Northern District of Indiana, Fort Wayne Division, or any other federal district court sitting in Indiana.
Miller's Bankruptcy trustee predecessor, Jule S. Walker ("Walker"), the bankruptcy trustee for the Import case, sued Conte for fiduciary defalcations while administering Import's Chapter 11 in adversary case 88-1084 in the United States Bankruptcy Court, Northern District of Indiana, Fort Wayne Division, and he recovered a monetary judgment against Conte on September 6, 1990 (amended September 20, 1990) ("Bankruptcy Court Judgment"). On or about November 29, 1993, the bankruptcy court approved the assignment of the Bankruptcy Court Judgment to Miller. The Bankruptcy Court Judgment was not entered into the judgment docket index of any Indiana circuit or county court. Miller domesticated the Bankruptcy Court Judgment in the Allen County Indiana, Superior Court, with a judgment dated January 6, 1997, in case 02D01-9610-CP-1532 ("Domesticated Judgment"). The Domesticated Judgment was entered into the Allen Circuit Court Judgment Docket Index on January 22, 1997. Miller filed a lis pendens notice on January 15, 1999 four days prior to filing the instant lawsuit.
The United States took no legal action to foreclose its liens as to the tract in question until the April 20, 1999 filing of case 1:99-CV-149, subsequently consolidated with this case.
The real estate which is targeted by both Miller and the United States is a tract in Allen County, Indiana, known as 1705 Buckskin Dr., Fort Wayne, Indiana, which now serves as the primary residence of Conte and his wife Carol Conte. The tract was acquired February 5, 1993, by purchase from Cedar Creek Farms, Inc. in the amount of $75,000. The purchase price was comprised of (1) $4,000.00 earnest money deposit; (2) $5,000.00 financed by the seller taking back a mortgage on the property (subsequently paid and released); and (3) $66,061.38 provided by Conte and his wife at closing. Cedar Creek Farms sold the property for its fair market value and it had no knowledge of Conte's unpaid obligations.
Cedar Creek provided a corporate deed of conveyance at the closing, which was recorded with the Allen County Recorder's office on February 10, 1993, placing title in the tract in question one-half in Peter Conte (an emancipated adult son living out of state), and one-half in Conte and his wife, which, if valid, would have created a tenancy by the entirety in Indiana. The $4,000.00 earnest money paid to the seller on January 19, 1993, came from a check drawn on a Standard Federal bank account owned by Carol Conte. Individually, Conte has not had a bank account in his own name since the failure of Import.
Columbia Land Title, Co. handled the closing. The $66,061.38 paid to it at the real estate closing was paid in the form of a Standard Federal cashier's check which check was comprised of (1) Peter Conte's check for $8,219.55 and (2) a check for $57,841.43 from Conte's Merrill Lynch account. The funds from the Merrill Lynch account were the proceeds from the sale of the stock Conte inherited from his mother and his father. Conte's mother died testate on September 8, 1992, leaving one-fourth of her net estate to Conte and three-fourths to Conte's siblings. Conte's inheritance was received in the form of marketable securities which he subsequently transmitted to a Merrill Lynch account.
Pursuant to a stipulation filed with court on October 12, 1999, advising it of a partial settlement reached by the remaining parties, Conte agreed to tender $57,841.43 to an escrow account in exchange for a release of the liens held by Miller and the IRS against his real estate. Under the terms of the stipulation, these funds are to remain in escrow until further order of this Court determining the entitlement of the parties to portions of or all of these funds.
Summary judgment is proper "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." Fed. R.Civ.P. 56(c). The burden is on the moving party to show that no genuine issues of material fact exist. Celotex Corp. v. Catrett, 477 U.S. 317, 322, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). Rule 56(c) mandates the entry of summary judgment, after adequate time for discovery, against a party "who fails to make a showing sufficient to establish the existence of an element essential to that party's case, and in which that party will bear the burden of proof at trial." Celotex Corp. v. Catrett, 477 U.S. 317, 322, 106 S.Ct. 2548, 2552-53, 91 L.Ed.2d 265 (1986). These traditional notions apply equally where, as here, opposing parties each move for summary judgment in their favor pursuant to Rule 56. I.A.E., Inc. v. Shaver, 74 F.3d 768, 774 (7th Cir.1996). Thus, when cross-motions for summary judgment are filed, the "[c]ourt must take a dual perspective: [e]ach movant has the burden of establishing the absence of any genuine issue of material fact on its own motion." ITT Industrial Credit Co. v. D.S. America, Inc., 674 F.Supp. 1330, 1331 (N.D.Ill.1987).
The standard for granting summary judgment mirrors the directed verdict standard under Rule 50(a), which requires the court to grant a directed verdict where there can be but one reasonable conclusion. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 250, 106 S.Ct. 2505, 2511, 91 L.Ed.2d 202 (1986). A scintilla of evidence in support of the non-moving party's position is not sufficient to successfully oppose summary judgment; "there must be evidence on which the jury could reasonably find for the plaintiff." Id. at 2512, 106 S.Ct. 2505; North Am. Van Lines, Inc. v. Pinkerton Sec. Sys., Inc., 89 F.3d 452, 455 (7th Cir.1996); In Re Matter of Wildman, 859 F.2d 553, 557 (7th Cir.1988); Klein v. Ryan, 847 F.2d 368, 374 (7th Cir.1988). No genuine issue for trial exists "where the record as a whole could not lead a rational trier of fact to find for the nonmoving party." Juarez v. Ameritech Mobile Communications, Inc., 957 F.2d 317, 322 (7th Cir.1992) (quoting Matsushita Elec. Indus. Co., Ltd. v. Zenith Radio Corp., 475 U.S. 574, 586, 106 S.Ct. 1348, 1356, 89 L.Ed.2d 538 (1986)).
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