Turner v. US, CV-S-93-744-PMP (LRL).

• Citation: 875 F. Supp. 1430
• Decision Date: 02 February 1995
• Docket Number: No. CV-S-93-744-PMP (LRL).,CV-S-93-744-PMP (LRL).
• Parties: Wayne M. TURNER, Plaintiff, v. The UNITED STATES of America, acting through the U.S. Department of Agriculture, Farmers Home Administration, an Agency of the United States of America, Defendant.
• Court: U.S. District Court — District of Nevada

875 F. Supp. 1430

Wayne M. TURNER, Plaintiff, v. The UNITED STATES of America, acting through the U.S. Department of Agriculture, Farmers Home Administration, an Agency of the United States of America, Defendant.

No. CV-S-93-744-PMP (LRL).

United States District Court, D. Nevada.

February 2, 1995.

Thomas Rondeau, Wilbur M. Roadhouse, Goold, Patterson, DeVore & Rondeau, Las Vegas, NV, for plaintiff.

Carlos A. Gonzalez, Asst. U.S. Atty., Las Vegas, NV, for defendant.

ORDER

PRO, District Judge.

Before the Court is Plaintiff Wayne M. Turner's Renewed Motion for Summary Judgment (# 20), filed November 9, 1994. The Defendant the United States (the "Government") filed its Opposition to Plaintiff's Renewed Motion for Summary Judgment (# 24) on November 23, 1994. Plaintiff filed a Reply (# 25) on December 6, 1994.

Also before the Court is the Defendant United States' Motion for Summary Judgment (# 22), filed November 10, 1994. Plaintiff Wayne M. Turner ("Turner") filed his Opposition to Defendant United States' Motion for Summary Judgment (# 23) on November 23, 1994. The United States filed a Reply (# 27) on December 12, 1994.

I. Background

This is an action for declaratory relief and to quiet title to certain real property¹ located in Lincoln County, Nevada (the "Farm") on which the Defendant claims a lien pursuant to a loan obtained from the Farmer's Home Administration.

Plaintiff Wayne M. Turner owns the Farm in Lincoln County, Nevada, on which he resides. Under the provisions of the Consolidated Farm and Rural Development Act ("RDA"), as amended, 7 U.S.C. §§ 1921 to 1936, the Secretary of Agriculture is authorized to grant certain loans to farmers and ranchers. See 7 U.S.C. § 1922 (1994). The Secretary grants these loans through the United States Department of Agriculture, Farmers' Home Administration ("FmHA").

On August 6, 1979, the FmHA granted a Farmers' Home Loan ("FmHA loan") to Plaintiff and his now deceased wife, Janice Turner, for development of Plaintiff's Farm and to refinance certain other loans. Plaintiff signed a note in favor of the Farmers' Home Administration. As security, Plaintiff and Janice Turner, as Trustors, gave a Deed of Trust on the Farm to FmHA as beneficiary. This Deed of Trust ("FmHA Trust Deed") was recorded on August 7, 1979, in Lincoln County, Nevada.

In connection with the FmHA loan, Plaintiff assigned to FmHA monthly payments which Plaintiff was entitled to receive on a promissory note made by Hobo Joe's, Las Vegas, NV, in favor of Plaintiff ("Hobo Joe Note"). Pursuant to the FmHA loan, the FmHA deferred regular payment under the FmHA note for 1979 to 1980. FmHA received limited payments on the FmHA loan from payments on the Hobo Joe Note from August 1979 to December 1980.

FmHA took the position that the assignment of the monthly payments on the Hobo Joe Note was not limited to that period but that FmHA was entitled to Hobo Joe Note monthly payments after December 1980, as well. Because of the conflicting claims of Plaintiff and FmHA, periodic payments from the Hobo Joe Note were placed in an escrow account.

In June 1984, Plaintiff filed a Complaint in the United States District Court, District of Nevada, against FmHA. See Turner v. United States of America, CV-S-84-362-HDM (LRL). In June 1989, Plaintiff filed a Complaint in Clark County District Court. That case was removed to the United States District Court. See Turner v. United States of America, CV-S-89-575-HDM (LRL). In these cases, Plaintiff sought the release of the funds held in escrow.

In 1987, the obligor on the Hobo Joe Note paid in full the outstanding principal balance of the Hobo Joe Note, approximately $165,000.00. This sum was also placed in the escrow account. In April 1987, Plaintiff filed a claim in the United States Claims Court seeking the release of all escrow funds, including the amount of principal, seeking damages to recover lost revenue for the crops Plaintiff could not plant because Plaintiff's seed money was held in escrow, and seeking punitive damages. See Turner v. United States of America, No. 117-87C.

Following trial in May 1991, in case CV-S-89-575-HDM (LRL), the Court decided that Plaintiffs, Wayne and Janice Turner, were entitled to all funds held in escrow. The Government then obtained a stay order on the escrow funds pending a possible appeal.

The parties to the Claims Court case subsequently entered into a settlement agreement which in part provided that all Plaintiff's claims in the various actions would be settled. The parties entered into joint stipulations of dismissal with prejudice in the United States Claims Court and the United States District Court actions respectively. Finally, pursuant to the Settlement Agreement, the escrow company holding the funds released those monies to Turner.

After FmHA attempted to re-negotiate the lien on Plaintiff's Farm, Plaintiff filed the instant action.

II. Summary Judgment

Pursuant to Federal Rule of Civil Procedure 56, 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."

The party moving for summary judgment has the initial burden of showing the absence of a genuine issue of material fact. See Adickes v. S.H. Kress & Co., 398 U.S. 144, 90 S.Ct. 1598, 26 L.Ed.2d 142 (1970); Zoslaw v. MCA Distrib. Corp., 693 F.2d 870, 883 (9th Cir.1982), cert. denied, 460 U.S. 1085, 103 S.Ct. 1777, 76 L.Ed.2d 349 (1983). Once the movant's burden is met by presenting evidence which, if uncontroverted, would entitle the movant to a directed verdict at trial, the burden then shifts to the respondent to set forth specific facts demonstrating that there is a genuine issue for trial. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 250, 106 S.Ct. 2505, 2511, 91 L.Ed.2d 202 (1986). If the factual context makes the respondent's claim implausible, that party must come forward with more persuasive evidence than would otherwise be necessary to show that there is a genuine issue for trial. Celotex Corp. v. Catrett, 477 U.S. 317, 323-24, 106 S.Ct. 2548, 2552-53, 91 L.Ed.2d 265 (1986); Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586-87, 106 S.Ct. 1348, 1355-56, 89 L.Ed.2d 538 (1986); California Arch. Bldg. Prod. v. Franciscan Ceramics, 818 F.2d 1466, 1468 (9th Cir.1987), cert. denied, 484 U.S. 1006, 108 S.Ct. 698, 699, 98 L.Ed.2d 650 (1988).

If the party seeking summary judgment meets this burden, then summary judgment will be granted unless there is significant probative evidence tending to support the opponent's legal theory. First National Bank of Arizona v. Cities Service Co., 391 U.S. 253, 290, 88 S.Ct. 1575, 1593, 20 L.Ed.2d 569 (1968); Commodity Futures Trading Comm'n v. Savage, 611 F.2d 270 (9th Cir. 1979). Parties seeking to defeat summary judgment cannot stand on their pleadings once the movant has submitted affidavits or other similar materials. Affidavits that do not affirmatively demonstrate personal knowledge are insufficient. British Airways Bd. v. Boeing Co., 585 F.2d 946, 952 (9th Cir.1978), cert. denied, 440 U.S. 981, 99 S.Ct. 1790, 60 L.Ed.2d 241 (1979). Likewise, "legal memoranda and oral argument are not evidence and do not create issues of fact capable of defeating an otherwise valid motion for summary judgment." Id.

A material issue of fact is one that affects the outcome of the litigation and requires a trial to resolve the differing versions of the truth. See Admiralty Fund v. Hugh Johnson & Co., 677 F.2d 1301, 1305-06 (9th Cir. 1982); Admiralty Fund v. Jones, 677 F.2d 1289, 1293 (9th Cir.1982).

All facts and inferences drawn must be viewed in the light most favorable to the responding party when determining whether a genuine issue of material fact exists for summary judgment purposes. Poller v. CBS, Inc., 368 U.S. 464, 82 S.Ct. 486, 7 L.Ed.2d 458 (1962). After drawing inferences favorable to the respondent, summary judgment will be granted only if all reasonable inferences defeat the respondent's claims. Admiralty Fund v. Tabor, 677 F.2d 1297, 1298 (9th Cir.1982).

The trilogy of Supreme Court cases cited above establishes that "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.'" Celotex Corp., 477 U.S. at 327, 106 S.Ct. at 2555 (quoting Fed.R.Civ.P. 1). See also Avia Group Int'l, Inc. v. L.A. Gear Cal., 853 F.2d 1557, 1560 (Fed.Cir.1988).

III. Choice of Law

"An agreement to settle a legal dispute is a contract and its enforceability is governed by familiar principles of contract law." Jeff D. v. Andrus, 899 F.2d 753, 759 (9th Cir.1989). Plaintiff argues that Nevada contract law governs the interpretation of the Settlement Agreement.

As a general rule, principles of local law govern the construction and enforcement of settlement agreements. Air Line Stewards & Stewardesses Assoc., Local 550 v. Trans World Airlines, 713 F.2d 319, 321 (7th Cir.1983); Jeff D., 899 F.2d at 759 (applying Idaho law to interpret a settlement agreement between private parties); United Commercial Ins. Service, Inc. v. Paymaster Corp., 962 F.2d 853, 856 (9th Cir.1992), cert. denied, ___ U.S. ___, 113 S.Ct. 660, 121 L.Ed.2d 585 (1992). However, when the United States is a party to a contract entered pursuant to federal law, federal law controls.²United States v. Seckinger, 397 U.S. 203, 209-10, 90 S.Ct. 880, 884, 25 L.Ed.2d 224 (1970); Kennewick Irrigation Dist. v. United States, 880 F.2d 1018, 1032 (9th Cir.1989); Saavedra v. Donovan, 700 F.2d 496, 498 (9th Cir.1983), cert. denied, 464 U.S. 892, 104 S.Ct. 236, 78 L.Ed.2d 227 (1983). In this case, the United States through the Attorney General is a party to the...