Peter v. Gill

• Court: Superior Court of Guam
• Decided: May 5, 2020
• Docket: CV0426-18
• Status: Unknown

Opinion

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IN THE SUPERIOR COURT OF GUAM S3/= (MP

JOSHUA F. PETER, ET AL., Superior Court Case No. CV0426-18

Plaintiffs, DECISION AND ORDER vs. RE PLAINTIFFS' MOTION TO CORRECT FRANCIS GILL, ET AL,, M1STAKES UNDER GRCP 60(b)(1) Defendants.

This Court here considers Plaintiffs' Motion to Correct Mistakes Under GRCP 60(b)(1).

Plaintiffs ask the Court to correct its October 3, 2019 Decision and Order re Defendants' Motion

for Partial Summary Judgment to reflect summary judgment in favor of Defendant Cy'fi'ed, Ltd.

only and to set aside summary judgment on Plaintiffs' Fourth Count

Under Rule 60(b)(1), a court may amend an order due to mistake, inadvertence, surprise,

or excusable neglect. Plaintiffs argue it was a "mistake of fact or law to grant [Mr. Gill] summary

judgment" and to grant Defendants summary judgment on Plaintiffs' Fourth Count. Mot. Correct

at 4, 6 (Feb. 18, 2020). By premising their Rule 60(b)(1) motion upon mistake, the Court can

only provide relief if it finds it "has made a substantive mistake of law or fact in the final

judgment or order." YappVuExcel Corp, 186F.3d1222, 1231 (10th Cir. 1999).

Plaintiffs first contend the Court made a procedural error by granting summary judgment

in Mr. GilTs favor as Mr. Gill did not appear in the case until February 21, 2019--after Cyiied

filed its motion. If one defendant is granted a motion for summary judgment, a court may sue

spate enter summary judgment in favor of nonmoving additional defendants "if the motion CV0426-18 DECISION AND ORDER RE PLAINTIFFS' MOTION TO CORRECT Page 2 MISTAKES UNDER GRCP 60(b)(1)

raised by the first defendant is equally effective in barring the claim against the other defendants,

and the plaintiff had an adequate opportunity to argue in opposition to the motion." Colan u

Cutler-Hammen Inc., 812 F.2d 357, 360 n. 2 (7th Cir.), cert. denied, 484 U.S. 820 (1987).

The Court finds dirt it did not make a substantive mistake of law or fact in relation to

granting summary judgment in Mr. Gill's favor. The Court first notes that Mr. Gill joined

Defendants' Reply to their Motion for Partial Summary Judgment. Plaintiffs were aware that he

joined and could have objected at the hearing on the motion. Second, having reviewed the

relevant briefs, the Court finds both Defendants and Plaintiffs extensively argue about Mr. GilTs

role in the litigation and thus, Defendants' Motion was effective in addressing claims against Mr.

Gill. Plaintiffs had ample opportunity to argue what they are arguing now--for example, that Mr.

Gill made his March 14 promise as an individual with no relation to Cyfred. Reply at 4, 6 (Mar.

31, 2020). That argument could have easily countered Defendants' allegation in their motion dirt

all of Plaintiffs' claims had been released. Mot. Partial Sums. J. at 2 (Jan. 22, 2019).

Moreover, if Plaintiffs hoped to hold Mr. Gill personally liable for his March 14 promise,

they should have alleged a separate cause of action. "A claim against a defendant, based on the

alte r e g o the ory , is not itse lf a c laim for substantive re lie f, e .g ., bre ac h of c ontrac t or to se t aside a

fraudulent conveyance, but rather, procedural, i.e., to disregard the corporate entity as a distinct

defendant and to hold the alter ego individuals liable on the obligations of the corporation where

the corporate form is being used by the individuals to escape personal liability, sanction a fraud,

or promote injustice." Hennessey fs Tavern, Ire. u Am. Air Filter Co., 251 Cal. Rptr. 859, 863

(Cal. App. 1988), see also Kern v Gleason, 840 S.w2d 730, 736 (Tex. App. 1992) (holding that

although "a corporate entity may be the alter ego of an individual or the individual may be the

alter ego of the corporation, these facts do not create a separate cause of action against the CV0426-18 DECISION AND ORDER RE PLAINTIFFS' MOTION TO CORRECT Page 3 MISTAKES UNDER GRCP 60(b)(1)

corporation or the individual."). As drafted, Plaintiffs' Fourth Count seeks to hold Mr. Gill liable

for Cyfied's obligations under the Settlement Agreement because "Cyfred has been the alter ego

of Francis Gill, and Francis Gill has been its alter ego" and therefore "Francis Gill and/or Cyfi'ed

are jointly and severally liable.. as Second Am. Compo. 1111 7, 81, 86 (Aug. 27, 2019). If Mr.

Gi11's promise had nothing to do with the parties' settlement agreement, as Plaintiffs are now

attempting to allege, they should have pleaded it as a separate cause of action not based on an

alter ego theory.

Plaintiffs similarly argue that the Court made a second procedural mistake: Defendants

did not move for summary judgment on Plaintiffs' Fourth Count and therefore the Court should

not have granted them summary judgment on it. However, right off the bat, Defendants' Motion

for Partial Summary Judgment makes clear that they sought summary judgment on all counts

except for "any issues relative to attorney fees for subsequent consideration by the Court." Mot.

Partial Sums. J. at 2. Plaintiffs acknowledged that "[Defendants] contended that all claims in

this action have been re1eased...In any event, as indicated in Section II above, the facts show that

[Plaintiffs'] claims against Cyfred, including their breach of contract claims against it, were not

released...." Opp'n Mot. Partial Summ. I. at 10 (Feb. 19, 2019).

Though Defendants' may not have expressly discussed how the March 14 promise

applied in a breach of contract context, it did argue all the claims had been released and both

parties discussed the March 14 promise at length throughout their briefs. "[C]ourts are widely

acknowledged to possess the power to enter summary judgments sue sponge, so long as the

losing party was on notice that she had to come forward with all of her evidence." Lujan u

Qui rata, 2014 Guam 20 1]24 (quotations omitted). Plaintiffs were therefore on notice to produce

all of their evidence to refute Defendants' allegations. Accordingly, the Court finds that it made CV0426-18 DECISION AND ORDER RE PLAINTIFFS' MOTION TO CORRECT Page 4 MISTAKES UNDER GRCP 60(b)(1)

neither a mistake of law or fact in granting Defendants summary judgment on Plaintiffs' Fourth

Count.

In conclusion, the Court DENIES Plaintiffs' Motion.'

SO ORDERED this 5th day of May 2020.

| n;i§y~z1;_m_.._11;1ARTE Judge, Superior Court'of Guam "', . \ . - "~. gr

Appearing Parties: Wayson W S. Wong for Plaintiffs Curtis C. Van dh veld for Cyfred, Ltd., and Leonard Francis Gill Stephanie Mendiola, pro sh

1 Plaintiffs also argue that in light of the Court's alleged mistakes in its October 3, 2019 Decision and Order, the fraud defenses originally asserted by Defendants that the Court dismissed as moot are still ripe. Because the Court finds it did nut make a mistake, it declines to address this argument.