Rabo Agrifinance, LLC v. Veigel, A-1-CA-37199

CitationNo. A-1-CA-37199
Case DateJanuary 09, 2020
CourtCourt of Appeals of New Mexico

RABO AGRIFINANCE, LLC, a Delaware limited liability company, Plaintiff-Appellee,
STEVE VEIGEL, Defendant-Appellant.

No. A-1-CA-37199


January 9, 2020

This decision of the New Mexico Court of Appeals was not selected for publication in the New Mexico Appellate Reports. Refer to Rule 12-405 NMRA for restrictions on the citation of unpublished decisions. Electronic decisions may contain computer-generated errors or other deviations from the official version filed by the Court of Appeals.

Albert J. Mitchell, Jr., District Judge

Rowley Law Firm, L.L.C.
Richard F. Rowley, II
Clovis, NM

for Appellee

William F. Davis & Associates, P.C.
William F. Davis
Nephi D. Hardman
Albuquerque, NM

for Appellant


HANISEE, Chief Judge.

{1} Steve Veigel (Defendant) appeals the district court's orders denying discovery and granting summary judgment in favor of Rabo Agrifinance, LLC (Plaintiff). We affirm.


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{2} This case stems from litigation in a related foreclosure action (the foreclosure case) between Plaintiff, successor in interest to Farm Credit Bank of Texas (FCBT) and First Ag Credit, and entities run by members of the Veigel family. The foreclosure litigation has included three prior appeals in this Court. See Rabo Agrifinance, Inc. v. Terra XXI, Ltd., No. 34,757, mem. op. ¶ 1 (N.M. Ct. App. Nov. 18, 2015) (non-precedential); see also Rabo Agrifinance, Inc. v. Terra XXI, Ltd., 2014-NMCA-106, ¶ 2, 336 P.3d 972; Rabo Agrifinance, Inc. v. Terra XXI, Ltd., 2012-NMCA-038, ¶ 2, 274 P.3d 127; and a fourth appeal is pending. See Rabo Agrifinance, LLC v. Terra XXI Ltd., No. A-1-CA-37117, mem. op. (N.M. Ct. App. Jan. 9, 2020) (non-precedential).

{3} In the present case, Plaintiff filed a declaratory judgment action to have a special warranty deed issued to Defendant declared null and void. The deed in question was filed on July 9, 2015 (the July 2015 Deed), conveying real property in Quay County—all of Section 7, Township Seven North (7N), Range Twenty-seven East (27E) N.M.P.M (the property at issue)—from three Veigel family entities, Terra XXI Ltd. (Terra XXI), Terra Partners, and S.S. Williams Testamentary Trust (SSWT Trust). Before this purported conveyance, on May 19, 2015, several properties, including the property at issue, were sold to Plaintiff at a foreclosure sale (the foreclosed properties). On the same day as the foreclosure sale, the three Veigel family entities allegedly conveyed to Defendant property interests in Guadalupe and Quay County (the May 2015 Deeds). Notably, eight years earlier in 2007, notice of lis pendens was filed on all the foreclosed properties, including the property at issue, and in the month prior to the May 2015 foreclosure sale, the Special Master published the required notices of sale in Quay and Guadalupe County newspapers. In the foreclosure case, Judge Tatum approved the foreclosure sale in his May 4, 2016 order, and declared the May 2015 Deeds to Defendant null and void in a June 2016 order.

{4} Since the July 2015 Deed was likewise clouding title to the foreclosed properties, Plaintiff filed its complaint seeking declaratory judgment regarding that deed in April 2017. After Defendant answered the complaint and Plaintiff filed its reply, the district court held a scheduling conference and elected to stay discovery given the potentially dipositive nature of the legal questions of res judicata and collateral estoppel and the litany of prior discovery and litigation related to the dispute. In its ensuing order on June 30, 2017, the district court outlined the briefing deadlines related to summary judgment and limited discovery such that Defendant was required to seek leave from the court if "a very limited amount of written discovery [was] needed in order to respond to Plaintiff's [m]otion for [s]ummary [j]udgment[.]" In July 2017 the district court extended the briefing deadlines by thirty days, with Plaintiff's motion for summary judgment due on September 1, 2017, and Defendant's response due on October 1, 2017.

{5} Plaintiff filed its summary judgment motion by the September 1 deadline, and its memorandum in support was served on Defendant the same day. However, Plaintiff's memorandum in support was not filed with the district court until September 5, 2017, because Plaintiff was instructed by the clerk of court to mail the voluminous exhibits (approximately 320 pages) instead of filing them electronically. Defendant filed a timely response (response in opposition), stating that a memorandum was forthcoming, but did

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not request leave of the court for his failure to file by the deadline. Fifteen days later, on October 16, 2017, Defendant filed a seventy-page memorandum accompanied by almost 1,400 pages of exhibits (memorandum in opposition)—again without requesting leave of the court or acknowledging his failure to meet the district court's deadline—one day before Plaintiff timely filed its reply brief.

{6} On October 20, 2017, the district court scheduled the motion for summary judgment hearing for January 29, 2018. Two months later on January 22, 2018, Defendant moved for an order allowing him to conduct discovery and also vacate the summary judgment hearing. At the January 29 hearing, the district court heard arguments on Defendant's motion for discovery and to delay resolving Plaintiff's summary judgment motion, but denied the motion given its timing and how deeply intertwined Defendant was in the entirety of the litigation history between the parties. The district court then took judicial notice of Judge Tatum's January 2018 order in the foreclosure case and stated that "many of the issues are overlapping" from that case. Then, the district court heard arguments on the summary judgment motion, and granted summary judgment in favor of Plaintiff. The district court issued an order to that effect (the final order), finding that Defendant's memorandum in opposition was untimely, and that based on Plaintiff's undisputed facts and the doctrine of res judicata and collateral estoppel, Plaintiff was entitled to judgment as a matter of law. Defendant appeals.


I. The District Court Did Not Abuse its Discretion in Denying Defendant's Untimely Discovery Request

{7} Defendant contends that the district court abused its discretion in denying his discovery request. We disagree. We review the district court's decision limiting discovery for an abuse of discretion. See Reaves v. Bergsrud, 1999-NMCA-075, ¶ 13, 127 N.M. 446, 982 P.2d 497. "An abuse of discretion occurs when the trial court's ruling is against the facts, logic, and circumstances of the case or is untenable or unjustified by reason." Id. While there is a general presumption in favor of pretrial discovery under Rule 1-026(B)(1) NMRA, "the [district] court is vested with the authority to limit discovery[,]" and "where it appears that the party requesting discovery has already been granted sufficient information discovery may be properly denied or limited." Reaves, 1999-NMCA-075, ¶ 14 (alteration, internal quotation marks and citation omitted).

{8} In this declaratory action, the district court quickly elected to curtail discovery given the dispositive legal questions of res judicata and collateral estoppel and the extensive previous discovery and litigation related to the dispute. Moreover, in its scheduling order, the district court put Defendant on notice that if he needed a limited amount of discovery to respond to the summary judgment motion, he had to request leave of the court. See State ex rel. State Highway Dep't v. Branchau, 1977-NMSC-048, ¶ 5, 90 N.M. 496, 565 P.2d 1013 ("The pretrial order determines the issues and becomes the law of the case."). Defendant then filed his response and memorandum in opposition without requesting leave of the court to conduct further discovery. More than

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two months later, however, and only seven days before the summary judgment hearing, Defendant filed a broad discovery motion, which was not limited to the discovery of specific information but rather a general request for discovery on all issues, including to support Defendant's counterclaims.1 Considering the circumstances here—the untimeliness and overbreadth of Defendant's discovery request, Defendant's non-compliance with the pretrial order, and the dispositive nature of legal questions at issue—we hold that the district court did not abuse its discretion in denying Defendant's motion for discovery.

II. The District Court Did Not Err in Granting Plaintiff's Motion for Summary Judgment

{9} Defendant next argues that the district court erred in granting summary judgment for several reasons: (1) Plaintiff failed to meet its burden to demonstrate that there are no genuine issues of material fact; (2) Plaintiff did not have standing to pursue the relief it sought under the federal Farm Credit Act; (3) the district court erred in applying res judicata and collateral estoppel; and (4) res judicata and collateral estoppel are inapplicable because prior court rulings were subject to collateral attack as void judgments that violated the bankruptcy court's discharge injunction and plan confirmation. We are unpersuaded.

{10} We review the final order granting summary judgment de novo. Freeman v. Fairchild, 2018-NMSC-023, ¶ 14, 416 P.3d 264. We consider "the facts in a light most favorable to the party opposing summary judgment and draw all reasonable inferences in support of a trial on the merits." Id. (internal quotation marks and citation omitted). Summary judgment is appropriate where "there is no genuine issue of material fact and the moving party is entitled to judgment as a matter of law." Id. ¶ 16 (internal quotation marks and citation omitted).

{11} "The party moving for summary judgment has the initial burden of establishing a prima facie case for summary judgment by presenting such evidence as is sufficient in law to raise...

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