United States v. Foreman
| Decision Date | 21 March 2016 |
| Docket Number | Case No: 6:14-cv-1965-Orl-40DAB |
| Court | U.S. District Court — Middle District of Florida |
| Parties | UNITED STATES OF AMERICA, Plaintiff, v. CHAD FOREMAN, Defendant. |
This cause came on for consideration without oral argument on the following motion filed herein:
On November 26, 2014, the United States, on behalf of the Department of Education (the "Department"), filed a Complaint against Defendant Chad Foreman seeking to recover defaulted student loans made to him for attendance at St. Thomas Law School in Miami in the mid-1980's. Docs. 1, 11-1, 11-2. The loans were guaranteed by the Florida Department of Education Office of Student Financial Assistance and then reinsured under loan guaranty programs authorized under Title IV-B of the Higher Education Act of 1965, as amended, 20 U.S.C. 1071 et seq. (34 C.F.R. Part 682). Doc. 1.
On January 8, 2016, the Department filed a Motion for Summary Judgment. Doc. 11. Although Defendant Foreman answered the Complaint, and he is represented by counsel, he has not responded to the Motion for Summary Judgment. For the reasons set forth below, it is respectfully RECOMMENDED that the Motion for Summary Judgment be GRANTED.
I. Procedural History
On November 26, 2014, the Department filed a Complaint against Defendant seeking to reduce his defaulted student loans to judgment and obtain money damages for the amounts owed on these federally guaranteed student loans. Doc. 1. On July 26, 2015, the Defendant answered the Complaint, denying all allegations except those related to jurisdiction and admitting that a demand for payment had been made upon him; he also asserted affirmative defenses that the Department's claims are barred by the statute of limitations and laches. Doc. 9.
On January 8, 2016, the Department filed its Motion for Summary Judgment on the student loan agreements, providing copies of the Applications and Promissory Notes signed by Defendant and two Certificates of Indebtedness from a Department loan analyst. Docs. 11, 11-1, 11-2 (with exhibits). On January 21, 2016, Defendant filed a Motion to Extend Time to Respond to the Department's Summary Judgment Motion (Doc. 12) which was granted the same day (Doc. 13); thus, Defendant's response was due on February 8, 2016. Despite the passage of more than an additional month since the response deadline, Defendant has failed to file any response as of the date of this Report and Recommendation.
"The court shall grant summary judgment if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed.R.Civ.P. 56(a). In ruling on a motion for summary judgment, the Court construes the facts and all reasonable inferences therefrom in the light most favorable to the nonmoving party. Reeves v. Sanderson Plumbing Prods., Inc., 530 U.S. 133, 150, 120 S.Ct. 2097, 147 L.Ed.2d 105 (2000). However, when faced with a "properly supported motion for summary judgment, [the nonmoving party] must come forward with specific factual evidence, presenting more than mere allegations."Gargiulo v. G.M. Sales, Inc., 131 F.3d 995, 999 (11th Cir. 1997).
Summary judgment is mandated "against a party who fails to make a showing sufficient to establish the existence of an element essential to that party's case, and on which that party will bear the burden of proof at trial." Celotex Corp. v. Catrett, 477 U.S. 317, 322, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). "Summary judgment may be granted if the non-moving party's evidence is merely colorable or is not significantly probative." Sawyer v. Southwest Airlines Co., 243 F.Supp.2d 1257, 1262 (D. Kan. 2003) (citing Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 250-51, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986)).
"[A]t the summary judgment stage the judge's function is not himself to weigh the evidence and determine the truth of the matter but to determine whether there is a genuine issue for trial." Anderson, 477 U.S. at 249. "Essentially, the inquiry is 'whether the evidence presents a sufficient disagreement to require submission to the jury or whether it is so one-sided that one party must prevail as a matter of law.'" Sawyer, 243 F.Supp.2d at 1263 (quoting Anderson, 477 U.S. at 251-52).
The Department argues that it is entitled to summary judgment on the promissory notes at issue because the material facts in this case are not in dispute; Defendant executed the promissory notes that are the subject of this action; the Department of Education is the holder of the promissory notes; and the amounts due on the notes have not been paid. Doc. 11 at 4. Specifically, the Department has produced evidence that Defendant executed several promissory notes and obtained student loans; he subsequently defaulted on his payment obligations; and to dispute the amounts owed, he must prove the nonexistence or extinguishment of the debts, which he has failed to do. Id. at 5.
The requirements necessary to establish a prima facie case of student loan default for summary judgment purposes has been addressed by the Eleventh Circuit. The Department may establish a prima facie case of student loan default by proving three elements: (1) the defendant signed a promissory note for a student loan; (2) the government is the present owner or holder of the promissory note signed by the defendant; and (3) the promissory note is in default. United States v. Carter, 506 Fed. App'x 853, 858 (11th Cir. 2013) (per curiam) (citing United States v. Lawrence, 276 F.3d 193, 197 (5th Cir. 2001)); United States v. Gordon, Case No. 8:10-cv-580-T-23EAJ, 2010 WL 4570147, *4 (M.D. Fla. Oct. 15, 2010); see also United States v. Romero, 562 F.App'x 943, 948 (11th Cir. 2014) (per curiam).
Defendant, Chad Foreman, obtained four student loans from Dade Savings and Loan Association under loan guaranty programs authorized under Title IV-B of the Higher Education Act of 1965 for the cost of his education. Doc. 11-1. The loans at issue in the case were reinsured by the Department of Education under loan guaranty programs authorized under the same Title IV-B of the Higher Education Act of 1965, as amended, 20 U.S.C. § 1071 et seq. (34 C.F.R. Part 682). Doc. 11-1, 11-2. Once the Department establishes a prima facie case, the burden shifts to the Defendant to prove the nonexistence or extinguishment of the debts. United States v. Irby, 517 F.2d 1042, 1043 (5th Cir. 1975) ().
Four times between 1982 and 1984, Defendant signed promissory notes obligating him to repay Dade Savings and Loan Association for four $2,500 loans. Doc. 11-1 at 1. The Department has attached as an exhibit to the Motion for Summary Judgment a copy of the Dade Savings and Loan Association Promissory Notes executed by Defendant, as well as a Certificate of Indebtedness Number 1 ("COI No. 1"), signed under penalty of perjury by Delfin M. Reyes, Loan Analyst withthe United States Department of Education, indicating that Defendant defaulted on the loans at issue. Doc. 11-1 at 1.
According to the terms of the first promissory note signed on April 1, 1982, Defendant agreed to the following:
I, Chad R Foreman1, hereinafter called the "maker," promise to pay to Dade Savings and Loan Association, hereinafter called the "lender," located at 101 East Flagler Street, Miami FL, the sum of $2,500.00 to the extent it is advanced to me, plus simple interest at the rate of 9 percent per annum on the outstanding balance of such sum and authorized later charges, all reasonable attorney's fees, and other costs and charges necessary for the collection of any amount not paid when due. The lender will not collect or attempt to collect from the borrower any portion of the interest which is payable by the U.S. Government or by an escrow agent.
Doc. 11-1 at 2-3. The loan was disbursed the same day the note was signed, on April 1, 1982. Id. at 1 (Certificate of Indebtedness No. 1 of 2).
On March 26, 1983, Defendant signed a second promissory note to secure a student loan, as part of the Florida Guaranteed Student Loan Program, also promising to repay Dade Savings and Loan Association:
I, Chad Foreman, the borrower, promise to pay to Dade Savings and Loan Association, the lender, or to a subsequent holder of this Promissory Note, all of the principal sum of $2,500.00 to the extent it is advanced to me, plus an amount equivalent to simple interest on this sum at the rate of 9 percent per year. If I fail to pay any of these amounts when they are due, I will also pay all charges and other costs - including attorney's fees - that are permitted by State and Federal law and regulations and are necessary for the collection of these amounts. If this loan is referred for collection to an agency that is subject to the Fair Debt Collection Practices Act, I will pay those collection costs which do not exceed 25 percent of the unpaid principal and accrued interest.
Doc. 11-1 at 4-5. This loan was disbursed on April 1, 1983. Doc. 11-1 at 1.
On April 19, 1984 and October 15, 1984, Defendant signed the third and fourth promissory notes to Dade Savings and Loan Association containing identical language to the second loan for two additional loans of $2,500; these loan were disbursed on May 13, 1984 and October 26, 1984,respectively. Doc. 11-1 at 1, 6-9. The Court will refer to the four promissory notes made in conjunction with loans as described above (and summarized in the table below) collectively as the "Dade Savings Promissory Notes."
| Date Note Executed |
| Loan Amount |
| Date Disbursed |
| Interest rate |
| 4/1/82 |
| $2,500 |
| 4/1/82 |
| 9% |
| 3/26/83 |
| $2,500 |
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