322 F. Supp. 3d 266
D.P.R.2018Background
- Bautista Cayman (plaintiff) acquired non-real-estate loan assets and endorsed promissory notes and related security (including a mortgage on two Guaynabo properties) originally held by Doral Bank via a bill of sale after Doral's receivership by the FDIC.
- J.A.M.A. executed a loan (2008), promissory notes, a 2013 amended term loan, and granted a mortgage and various security/pledge agreements; personal guarantees were provided by Molina-Machargo and Rivera-Cano for 50% each.
- J.A.M.A. defaulted; Bautista Cayman demanded payment and sought foreclosure/execution of the mortgage and collection of sums reflected in the endorsed promissory notes.
- Bautista Cayman filed for summary judgment; J.A.M.A. failed to timely and properly controvert the moving party’s statement of uncontested material facts under Local Rule 56(c), later submitting an inadequate sur-reply.
- The court deemed Bautista Cayman’s SUMF admitted, found no genuine dispute on liability or chain of title to the endorsed notes, and concluded the quantified amounts owed (including interest, fees, and attorney’s fees) were supported.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Ownership/chain of title to notes | Bautista Cayman holds endorsed notes and received rights via FDIC bill of sale/endorsements | J.A.M.A.: bill of sale transferred relevant assets to a different Bautista entity (REO), so plaintiff lacks ownership | Court: Notes were endorsed to Bautista Cayman and evidence shows transfer to Bautista Cayman; ownership established |
| Default and entitlement to collect/payments | J.A.M.A. defaulted; plaintiff entitled to collect principal, interest, fees, and to enforce mortgage | J.A.M.A.: disputes amounts and demands detailed loan payment history and accounting | Court: No genuine factual dispute as to default or totals; plaintiff's unsworn statement under penalty plus documents suffice to establish amounts |
| Right to foreclose/execute mortgage | Mortgage and mortgage note secure the obligations; plaintiff entitled to execute mortgage on properties | Implicit challenge only through chain-of-title argument | Court: Mortgage valid under Puerto Rico law and plaintiff may execute mortgage to collect debt |
| Compliance with Local Rule 56 and effect on facts | Plaintiff complied with LR 56 and submitted SUMF | J.A.M.A. failed to timely/adequately oppose SUMF; later sur-reply mixed argument and lacked citations | Court: Treated SUMF as admitted under Local Rule 56(e); noncompliance fatal to defendant's opposition |
Key Cases Cited
- Celotex Corp. v. Catrett, 477 U.S. 317 (movant must show absence of evidence for nonmovant's case on summary judgment)
- Anderson v. Liberty Lobby, Inc., 477 U.S. 242 (genuine dispute standard at summary judgment)
- CMI Capital Market Inv. v. González-Toro, 520 F.3d 58 (First Circuit on district court relief from record-ferreting via local rules)
- Carreras v. Sajo, Garcia & Partners, 596 F.3d 25 (allocating burden of organizing evidence; importance of local rule compliance)
- Fontanez-Nunez v. Janssen Ortho LLC, 447 F.3d 50 (uncontested facts may be admitted but must still support summary judgment)
- Iverson v. City of Boston, 452 F.3d 94 (definition of genuine and material issues)
- Soto-Rios v. Banco Popular de Puerto Rico, 662 F.3d 112 (Puerto Rico mortgage law governs nature/effect of mortgages)