HSBC Bank USA v. Resh

40 F. Supp. 3d 728, 1992 U.S. Dist. LEXIS 23131, 2014 WL 4186960
CourtDistrict Court, S.D. West Virginia
DecidedAugust 21, 2014
DocketCivil Action No. 3:12-cv-00668
StatusPublished

This text of 40 F. Supp. 3d 728 (HSBC Bank USA v. Resh) is published on Counsel Stack Legal Research, covering District Court, S.D. West Virginia primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
HSBC Bank USA v. Resh, 40 F. Supp. 3d 728, 1992 U.S. Dist. LEXIS 23131, 2014 WL 4186960 (S.D.W. Va. 2014).

Opinion

MEMORANDUM OPINION AND ORDER

ROBERT C. CHAMBERS, Chief Judge.

Pending before the Court is a Motion by Third Party Defendants Lawyer’s Title Insurance Corporation (“Lawyer’s Title”), Helen Sullivan, and Realty Concepts, Ltd. (“Realty Concepts”), for Summary Judgment (ECF No. 328) and a Renewed Motion by Third Party Defendants Colliers International Valuation & Advisory Services, LLC (“Colliers”), and Philip Steffen for Summary Judgment (ECF No. 360). For the reasons explained below, the Motion by Lawyer’s Title, Ms. Sullivan, and Realty Concepts for Summary Judgment (ECF No. 328) is DENIED. The Renewed Motion by Colliers and Mr. Steffen for Summary Judgment (ECF No. 360) is GRANTED in part and DENIED in part. Specifically, it is granted as to Colliers’ and Mr. Steffen’s request for summary judgment in their favor on the third party claims made by Ron Resh and Valarie Reynolds-Resh (“the Reshes”) against them and on the crossclaims made against them by Lawyer’s Title and Ms. Sullivan. Summary judgment is denied, however, as to the counterclaims made by Colliers and Mr. Steffen against the Reshes.

I. Background

HSBC Bank USA, National Association (“HSBC Bank”) commenced the instant litigation by filing a Complaint against the Reshes, seeking over $2.6 million in unpaid principal due on three promissory notes executed by the Reshes, as well as interest, costs, fees, expenses, and interest. Compl., ECF No. 1. The Reshes had executed these three notes in order to purchase three commercial- properties in Beckley, Morgantown, and Huntington, [731]*731West Virginia, which all contained “Jiffy Lube” franchises.

The Reshes subsequently filed an answer, affirmative defenses, and counterclaim. ECF No. 16. Soon thereafter, with leave of the Court, the Reshes filed an amended answer, affirmative defenses, counterclaim, and third party complaint. ECF No. 20 (collectively referred to as “Third Party Complaint”). In their Third Party Complaint, the Reshes allege that the appraisals of the three properties, conducted before purchase, fraudulently overvalued the properties. They also allege that they were misled into believing that Peanut Oil, LLC—a “dummy corporation” owned by Samuel Pearson—already owned the properties at the time that the sale of the three properties to the Reshes was being negotiated, when in reality the three properties were owned by Adventure 2000. Peanut Oil bought the properties from Adventure 2000, allegedly at a much cheaper price than the Reshes later paid, shortly before Peanut Oil sold the three properties to the Reshes. The Reshes bought the properties on or about April 28, 2006, with the understanding that Peanut Oil would fulfill a 15-year lease of the properties. The Reshes purchased the properties for over $3.5 million, making a collective down payment of a little less than $1 million and executing notes for the remainder. Shortly thereafter, Peanut Oil defaulted on the lease. Because of Peanut Oil’s default, the Reshes were unable to fulfill their obligations to repay the underlying notes.

The Reshes allege that they are the victims of a fraudulent scheme in which they were induced to purchase the properties based on fraudulent information about the properties’ ownership and value, and it led them to enter into leases with a party who had no intentions of fulfilling those leases. This scheme was allegedly perpetrated so that the other parties could collect a windfall at the expense of the Resh-es. Specifically, the Reshes allege:

Count I: Fraudulent Misrepresentation
Count II: Fraudulent Concealment
Count III: Breach of Duty of Good
Faith and Fair Dealing
Count IV: Negligent Misrepresentation
CountV: Negligence
Count VI: Unjust Enrichment
Count VII: Violations of the Racketeer
Influenced & Corrupt Organizations Act (“RICO”)

The Reshes assert these claims against: HSBC Bank; Realty Concepts, a real estate firm; Andrew Brosnac, who allegedly was an employee of Realty Concepts and was the Reshes’ realtor; Lawyer’s Title; Helen Sullivan, a former employee of Lawyer’s Title; Colliers, the alleged successor in interest to PGP Valuation, Inc., the company that completed the appraisals; and Philip Steffen, an alleged former employee of PGP Valuation, Inc., and later employee of Colliers.1

Colliers and Mr. Steffen filed a Motion to Dismiss the Third Party Complaint, ECF No. 37, as did Realty Concepts, ECF No. 45. This Court denied Realty Concepts’ Motion to Dismiss but granted Colliers’ and Mr. Steffen’s Motion to Dismiss in part; specifically, the Court dismissed Counts II, IV, V, and VII as against Colliers and Mr. Steffen. Mem. Op. & Order, ECF No. 109.

On October 24, 2013, Collier and Mr. Steffen filed their first Motion for Summary Judgment, arguing that a settlement agreement signed by the Reshes on De[732]*732cember 2, 2010, barred the Reshes’ claims against Colliers and Mr. Steffen in the instant matter. ECF No. 235; see also Mem. Supp. Mot. Summ. J., ECF No. 236. On April 16, 2014, 2014 WL 1513460, this Court denied the Motion for Summary Judgment without prejudice, noting that “[t]he Reshes have raised in good faith a defense to this Motion and have sought additional discovery regarding the Settlement Agreement” and that “[t]he Reshes are entitled to this additional discovery in order to better respond to the arguments for summary judgment.” Mem. Op. & Order at 6, ECF No. 345.

On April 3, 2014, before the Court issued its Memorandum Opinion and Order denying Colliers’ and Mr. Steffen’s original Motion for Summary Judgment, Lawyer’s Title, Ms. Sullivan, and Realty Concepts filed their pending Motion for Summary Judgment. Thé Reshes filed a Response, ECF No. 351, and Lawyer’s Title, Ms. Sullivan, and Realty Concepts filed a Reply, ECF No. 354. On June 6, 2014, Colliers and Mr. Steffen filed their Renewed Motion for Summary Judgment. The Reshes filed a Response, ECF No. 366, and Colliers and Mr. Steffen filed a Reply, ECF No. 369. Both Motions are ripe for resolution.

In Section II, the Court discusses the legal standard applicable to motions for summary judgment generally. In Section III, the Court analyzes the Motion for Summary Judgment filed by Lawyer’s Title, Ms. Sullivan, and Realty Concepts. In Section IV, the Court examines the Renewed Motion for Summary Judgment filed by Colliers and Mr. Steffen.

II. Legal Standard

To obtain summary judgment, the moving party must show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law. Fed.R.Civ.P. 56(a). In considering a motion for summary judgment, the Court will not “weigh the evidence and determine the truth of the matter.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 249, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). Instead, the Court will draw any permissible inference from the underlying facts in the light most favorable to' the nonmoving party. Matsushita Elec. Indus. Co., Ltd. v. Zenith Radio Corp.,

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Anderson v. Liberty Lobby, Inc.
477 U.S. 242 (Supreme Court, 1986)
In Re Family Dollar FLSA Litigation
637 F.3d 508 (Fourth Circuit, 2011)
Marian Fontenot, Etc. v. The Upjohn Company
780 F.2d 1190 (Fifth Circuit, 1986)
Seals v. General Motors Corp.
546 F.3d 766 (Sixth Circuit, 2008)
Goodman v. Praxair, Inc.
494 F.3d 458 (Fourth Circuit, 2007)
Erickson v. Erickson
849 F. Supp. 453 (S.D. West Virginia, 1994)
Proctor v. Prince George's Hospital Center
32 F. Supp. 2d 820 (D. Maryland, 1998)
J.A. Street & Associates, Inc. v. Thundering Herd Development, Inc.
724 S.E.2d 299 (West Virginia Supreme Court, 2011)
Fabrizio v. Hendricks
654 N.E.2d 127 (Ohio Court of Appeals, 1995)
Shifrin v. Forest City Enterprises, Inc.
597 N.E.2d 499 (Ohio Supreme Court, 1992)
Board of Education v. Zando, Martin & Milstead, Inc.
390 S.E.2d 796 (West Virginia Supreme Court, 1990)

Cite This Page — Counsel Stack

Bluebook (online)
40 F. Supp. 3d 728, 1992 U.S. Dist. LEXIS 23131, 2014 WL 4186960, Counsel Stack Legal Research, https://law.counselstack.com/opinion/hsbc-bank-usa-v-resh-wvsd-2014.