U.S. v. Sackett, 96-2105

• Decision Date: 29 May 1997
• Docket Number: No. 96-2105,96-2105
• Citation: 114 F.3d 1050
• Parties: 97 CJ C.A.R. 789 UNITED STATES of America, Plaintiff-Appellee, v. James B. SACKETT and Gwendolyn Sackett, Defendants-Appellants.
• Court: U.S. Court of Appeals — Tenth Circuit

Page 1050

114 F.3d 1050

97 CJ C.A.R. 789

UNITED STATES of America, Plaintiff-Appellee, v. James B. SACKETT and Gwendolyn Sackett, Defendants-Appellants.

No. 96-2105.

United States Court of Appeals Tenth Circuit.

May 29, 1997.

John J. Kelly, United States Attorney, Manuel Lucero, Assistant U.S. Attorney, Albuquerque, New Mexico, for Plaintiff-Appellee.

Bill Chappell, Jr., Frances C. Bassett, and Dana L. Cox, of Chappell & Barlow, P.A., Albuquerque, New Mexico, for Defendants-Appellants.

Before PORFILIO and LOGAN, Circuit Judges, and BURRAGE, District Judge. ^*

PER CURIAM.

Defendants James B. Sackett and Gwendolyn Sackett appeal the district court's order granting summary judgment in favor of plaintiff. Defendants also challenge the district court's denial of their motion to reconsider and the award of attorney fees or, in the alternative, a surcharge pursuant to 28 U.S.C. § 3011 to plaintiff. We vacate the surcharge, and affirm the district court's judgment in all other respects. ¹

On June 30, 1980, defendants executed a promissory note in exchange for a loan from the Western Commerce Bank, formerly Commerce Bank and Trust (the bank). The loan was guaranteed by the Small Business Administration. When defendants failed to make payment pursuant to the note, the bank brought suit for collection in the Eddy County, New Mexico District Court. Thereafter, the bank and defendants entered into a Loan Revision Agreement whereby defendants agreed to various terms including a schedule of payments, and the bank agreed to dismiss the Eddy County court action. Defendants made several payments pursuant to the Loan Revision Agreement, but were in default for their failure to make the payment due on February 15, 1988. The loan was subsequently assigned to plaintiff, who instituted the underlying lawsuit on December 15, 1993. Defendants claim they are not liable for the debt evidenced by either the original note or the Loan Revision Agreement on the grounds that the Loan Revision Agreement is unenforceable, and the statute of limitations has run on the note.

We review the grant of summary judgment de novo, applying the same standard as the district court. See Applied Genetics Int'l, Inc., v. First Affiliated Secs., Inc., 912 F.2d 1238, 1241 (10th Cir.1990). "Summary judgment is appropriate when there is no genuine dispute over a material fact and the moving party is entitled to judgment as a matter of law." Russillo v. Scarborough, 935 F.2d 1167, 1170 (10th Cir.1991). We consider the record in the light most favorable to the non-moving party. See Deepwater Invs., Ltd. v. Jackson Hole Ski Corp., 938 F.2d 1105, 1110 (10th Cir.1991).

Defendants claim that disputed issues of material fact about whether the Loan Revision Agreement is enforceable preclude summary judgment. Defendants allege that the bank recorded a transcript of its Eddy County judgment after the date of the Loan Revision Agreement, thereby rendering the agreement void or unenforceable due to a failure of the bank's consideration. The bank later filed a release of the transcript of judgment.

The Loan Revision Agreement was an accord and satisfaction of the original debt. See Bennett v. Kisluk, 112 N.M. 221, 814 P.2d 89, 91 (1991) ("Discharge of an existing contractual obligation or settlement of a cause of action by an accord and satisfaction means (1) substituting an agreement (accord) for the obligation or cause of action, and (2) performing the substituted agreement (satisfaction)."). The bank satisfied its obligations under the accord and satisfaction by its substantial performance, even though there was a delay in recording the release of transcript of judgment. See National Old Line Ins. Co. v. Brown, 107 N.M. 482, 760 P.2d 775, 780 (1988) (accord satisfied by substantial performance); see also Bank of New Mexico v. Priestley, 95 N.M. 569, 624 P.2d 511, 517 (1981) ("[R]escission is not available where a breach of contract is not so substantial and fundamental as to defeat the object of the parties in making the contract."). Although defendants claim that the judgment was recorded in a second county and never released, there is nothing in the record to support this claim. Therefore, no disputed material facts prevent our finding the Loan Revision Agreement enforceable. Because we conclude that the Loan Revision Agreement was enforceable, we need not address whether defendants' post trial motion, raising this issue, was timely.

We turn to defendants' argument that the statute of limitations expired before this case was filed. The applicable statute of limitations, 28 U.S.C. § 2415(a), states:

every action for money damages brought by the United States or an officer or agency thereof which is founded upon any contract express or implied in law or fact, shall be barred unless the complaint is filed within six years after the right of action accrues ...: Provided, That in the event of later partial payment or written acknowledgment of debt, the right of action shall be deemed to accrue again at the time of each such payment or acknowledgment.

Defendants claim that the Loan Revision Agreement as a "written acknowledgment of [the] debt," and the payments made thereunder were partial payments as contemplated by § 2415(a). According to defendants, the last partial payment was made on June 19, 1987, causing the statute of limitations to run from that date, expiring in June of 1993, six months before this suit was filed.

Rather than an acknowledgment of the debt, however, the Loan Revision Agreement was a binding agreement supported by consideration to modify the terms of the original note. Cf. FDIC v. Petersen, 770 F.2d 141, 143 (10th Cir.1985) (distinguishing agreement to extend note or replace note with new contract from acknowledgment or part payment of debt). Accordingly, the Loan Revision Agreement controls, and the date on which defendants defaulted under that agreement, February 15, 1988, is the date on which the statute of limitations began to run. This action filed December 15, 1993, within six years of defendant's default, was within the limitations period.

Finally, we address defendants' challenge to the award of attorney fees or, in the alternative, the surcharge imposed pursuant to 28 U.S.C. § 3011. Defendants invoke the doctrines of collateral estoppel and res judicata to exclude any attorney fees incurred by the bank because the bank's judgment in the Eddy County case included its attorney fees, and there is no evidence that the bank ever vacated that judgment.

Contrary to defendants' argument, the release of transcript of judgment was evidence that the Eddy County judgment was set aside. See Appellants' App. at 47. Defendants produced no evidence to establish that the judgment remained in effect. Defendants may not resist summary...