Candelario-Del Moral v. UBS Financial Services Inc.

290 F.R.D. 336, 2013 WL 1791024, 2013 U.S. Dist. LEXIS 61792
CourtDistrict Court, D. Puerto Rico
DecidedApril 29, 2013
DocketCivil No. 08-1833 (SEC)
StatusPublished
Cited by3 cases

This text of 290 F.R.D. 336 (Candelario-Del Moral v. UBS Financial Services Inc.) is published on Counsel Stack Legal Research, covering District Court, D. Puerto Rico primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Candelario-Del Moral v. UBS Financial Services Inc., 290 F.R.D. 336, 2013 WL 1791024, 2013 U.S. Dist. LEXIS 61792 (prd 2013).

Opinion

OPINION AND ORDER

SALVADOR E. CASELLAS, Senior District Judge.

Before the Court are David Efron’s motion to intervene under Fed.R.Civ.P. 24(a)(2) (Docket # 198), and the parties’ response thereto. Dockets # 199 & 200. After reviewing the filings and the applicable law, Efron’s motion to intervene is DENIED.

Factual and Procedural Background

A comprehensive recitation of the procedural and factual background of this diversity tort suit case can be found in the First Circuit’s recent opinion in Candelario v. UBS, 699 F.3d 93 (1st Cir.2012). Here, the Court recounts only those facts necessary to explain why putative intervenor David Efron’s untimely petition must be denied. Suffice it to say that this case, which nears its fifth anniversary, is an offshoot of a broader and longstanding dispute between plaintiff Madeleine Candelario and Efron over the division of their “conjugal community property” following their divorce in 2001.

In this case, Candelario sues UBS Financial Services Incorporated of Puerto Rico (“UBS”) under Puerto Rico’s general tort statute, see P.R. Laws Ann. tit. 31, § 5141, for negligently releasing Efron’s funds and paying ch. his credit-line account. Docket # 1. There is a related proceeding in state court regarding the division of the “conjugal community property” and another in the Puerto Rico Bankruptcy Court—Efron’s bankruptcy proceedings. This federal action, more precisely, is a spillover of Candelario’s efforts to collect on a state-court judgment that ordered Efron to make advance payments of community property to Candelario until a community property division could be made. See Candelario, 699 F.3d at 95-96. If, as Efron contends, Candelario has already received her share of the community property, the Puerto Rico Court of Appeals has made clear that she would not be entitled to retain any excess monthly payments, for these are merely advances on her share of the community property. Candelario v. Efron, KLRX-10-000024, 2010 WL 3200139, at *6 (P.R. Cir. Apr. 30, 2010) (translation provided by the parties at Docket # 110-1, p. 38). A crucial determination in this case, then, relates to the amounts Candelario has received, and whether she has been made whole by such payments. Id.

On January 13, 2010, the Court entered summary judgment against UBS. Candelario del Moral v. UBS Financial Services Inc. of Puerto Rico, 691 F.Supp.2d 291 (D.P.R.2010). Later that month, UBS “informed Efron that it intended to seek indemnification from him [339]*339if the Court’s ruling were upheld on appeal.” Docket #200, p. 3. Under the terms of Efron’s master account agreement, UBS maintains that Efron is obliged to indemnify UBS for any claims relating to his accounts, including for any settlements, judgments, or damages incurred by UBS. Id. Then, on July 28, 2011, UBS filed a proof of claim in Efron’s bankruptcy proceedings to assert a claim for its litigation expenses in this case, and a contingent claim for indemnification of any settlements or judgment that might be incurred. Docket # 161-2.

On November 9, 2012, the First Circuit vacated this court’s summary judgment ruling and remanded the case for further proceedings. See Candelario, 699 F.3d at 107. A status conference was held soon thereafter, during which the parties discussed the First Circuit’s recommendation that “this is a case best resolved by settlement,” id., and this court’s suggestion that the parties mediate the claims. Minutes of January 17, 2013, Case Management and Status Conference, at Docket # 182, p. 1 (D.P.R. Jan. 17, 2013). As the Court and the parties agreed, “ascertaining the precise underlying liability from Efron to Candelario was crucial” to any meaningful assessment of damages or settlement. Id., p. 2. After UBS and Candelario picked a mediator, the Court entered a mediation order setting an April 30, 2013 deadline to conclude mediation. Docket # 193.

In the same time frame, UBS counsel contacted Efron to inform him that the case had been referred to mediation. Correspondence was then exchanged between UBS and Efron. Efron apparently disagreed with UBS’s position that his account agreement does not give him any right to participate in or control UBS’s litigation, and that UBS’s right to indemnification for a settlement is not conditioned on his approval. On March 4, 2013, UBS counsel informed Efron that UBS intended to proceed with the March 5 mediation in good faith, and that UBS reserved the right to enter into a reasonable settlement with Candelario in its sole discretion. UBS also reiterated that Efron’s “aecount agreement does not condition UBS’s right to indemnification on Efron’s advance authorization or approval,” and that, if UBS did enter into a settlement with Candelario, it intended to enforce its right to indemnification from Efron. Docket # 198-2.

Efron filed the instant motion one week later, on March 11, 2013. Docket # 198. He seeks to intervene pursuant to Fed.R.Civ.P. 24(a)(2) (intervention as of right) and requests a 30-day stay of the mediation and other proceedings, so that he may obtain leave of the bankruptcy court to retain counsel. Docket # 198.1 “[I]n order to avoid further miscarriages of justice and further appellate reversals of judgments in this case,” Efron maintains, he “should be allowed to intervene based on Rule 24(a)(2) of the Federal Rules of Civil Procedure.” Id., p. 2. It appears, furthermore, that Efron attempts to justify his motion on the basis that he “disagrees” with UBS’s stated position. He also asserts, without explaining why, that he is a “major player in this ease and could be the principally affected party in the results of the same.” Id., p. 1 (emphasis added).

Candelario timely opposed. She alleges that Efron’s motion “utterly fails to comply with the requirements for intervention.” Docket # 199, p. 1. She specifically posits that Efron’s request for intervention fails for the following reasons: (1) his application is untimely; (2) he cannot show that “his ability to protect his interest will be impaired by the instant litigation”; and (3) “he failed to follow the procedural rules related to intervention requests.” Id., p. 4. UBS, for its part, “takes no position” on Efron’s motion, explaining that, irrespective of whether Efron is permitted to intervene, it “intends to call Efron as a witness to offer evidence regarding whether Candelario has been made whole by the amounts she has received.” Docket #200, pp. 6-7. UBS acknowledges, however, that a “key question” is whether Efron’s motion to intervene is timely. Id., p. 1.

[340]*340Standard of Review

It is common ground that there are two strands of intervention: Intervention as of right, Fed.R.Civ.P. 24(a), and permissive intervention, Fed.R.Civ.P. 24(b). Insofar as Efron styles his motion as a motion to intervene as of right, see Docket 188 (expressly invoking Fed.R.Civ.P.

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Related

In re Efron
535 B.R. 516 (D. Puerto Rico, 2014)

Cite This Page — Counsel Stack

Bluebook (online)
290 F.R.D. 336, 2013 WL 1791024, 2013 U.S. Dist. LEXIS 61792, Counsel Stack Legal Research, https://law.counselstack.com/opinion/candelario-del-moral-v-ubs-financial-services-inc-prd-2013.