Stewart Title Guaranty Company v. Lewis

• Court: District Court, District of Columbia
• Decided: February 16, 2018
• Docket: Civil Action No. 2016-1372
• Status: Published

Opinion

UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA

INDEPENDENT SETTLEMENT SERVICES, LLC,

Plaintiff, v. Civil Action No. 16-1372 (JDB) JIMMY LEWIS,

Defendant.

MEMORANDUM OPINION

Independent Settlement Services, LLC, (“Independent”) alleges that Jimmy Lewis failed

to make payments required under a promissory note that he executed when he refinanced a

property in Washington, D.C. Independent has moved for summary judgment on the only

remaining claim in this action, i.e., the breach of contract claim against Lewis. Because there is

no genuine dispute as to any material fact and Independent has shown that it is entitled to judgment

as a matter of law, the Court will grant the motion.

BACKGROUND

I. FACTUAL B ACKGROUND

In November 2007, Lewis decided to refinance a property that he owned in Washington,

D.C. He received a $262,500 loan (the “Subject Loan”) from lender Taylor, Bean & Whitaker

Mortgage Corp. (“TBW”). In return, he executed a promissory note (the “Subject Note”) that

memorialized the terms of the loan and a deed of trust (the “Subject DOT”) to secure repayment

of the Subject Note with a lien against the property. See Subject Note, Ex. 2 to Pl.’s Mot. for

Summ. J. [ECF No. 25-3]; Subject DOT, Ex. 3 to Pl.’s Mot. for Summ. J. [ECF No. 25-4].

Independent conducted the closing and issued a title insurance commitment to TBW, which

1 committed Stewart Title Guaranty Company (“Stewart”) to insure the Subject DOT as a lien

against the property. See Am. Compl. [ECF No 10] ¶ 11; Independent’s Answer to Am. Compl.

[ECF No. 18] ¶ 11. Although Independent received funds for the payment of recording fees and

taxes, see Am. Compl. ¶ 13; Independent’s Answer to Am. Compl. ¶ 13, the Subject DOT was not

recorded in the District of Columbia land records, see 1st Aff. of J. Thurbee, Ex. 4 to Pl.’s Mot.

for Summ. J. [ECF No. 25-5] ¶ 8.

In or around May 2013, Lewis sold the property to Elston Johnson. 1st Aff. of J. Thurbee

¶ 10. Lewis continued to make monthly payments on the Subject Loan through July 2013, at which

point his outstanding balance was $243,785.36. 2nd Aff. of J. Thurbee, Ex. 1 to Pl.’s Reply [ECF

No. 28-1] ¶ 4. Thereafter, he made no further payments and, according to Stewart’s calculations,

he now owes more than $300,000, including unpaid principal, interest, and late fees. Id. ¶¶ 7–8.

In November 2013, Cenlar (then the holder of the Subject Note) submitted a claim for

coverage under the title insurance commitment when it discovered that the Subject DOT had not

been recorded. 1st Aff. of J. Thurbee ¶ 9; see Notice of Title Claim, Ex. 5 to Pl.’s Mot. for Summ.

J. [ECF No. 25-6]. 1 After Stewart confirmed that the Subject DOT was not recorded, see 1st Aff.

of J. Thurbee ¶ 10, it contacted Independent to inquire whether there was any factual or legal

reason that it should not settle the claim. Independent advised that there was no factual or legal

defense, see Ex. 6 to Pl.’s Mot. for Summ. J. [ECF No. 25-7]; consequently, Stewart settled the

claim by paying Nationstar $262,500 in exchange for an assignment of the Subject Note.

Nationstar executed an allonge transferring the Subject Note to Stewart, and delivered the original

copy of the Subject Note to Stewart. 1st Aff. of J. Thurbee ¶¶ 12–14; Sale & Assignment

Agreement, Ex. 7 to Pl.’s Mot. for Summ. J. [ECF No. 25-8].

1 Cenlar subsequently transferred the Subject Note to Nationstar Mortgage LLC (“Nationstar”). See Ex. 2 to Independent’s Opp’n to Mot. for Summ. J. [ECF No. 26-2].

2 II. PROCEDURAL B ACKGROUND

In June 2016, Stewart filed this lawsuit against Independent and Lewis. Stewart asserted

claims for breach of contract and negligence against Independent based on Independent’s alleged

failure to record the Subject DOT. See Am. Compl. ¶¶ 32–45. Stewart asserted a claim for breach

of contract against Lewis based on his alleged failure to make required payments under the terms

of the Subject Note. Id. ¶¶ 46–51. Stewart moved for summary judgment on its claims, see Pl.’s

Mot. for Summ. J. [ECF No. 25], and Independent and Lewis separately opposed the motion. 2

After the summary judgment briefing was completed, Stewart and Independent entered a

settlement agreement and Stewart voluntarily dismissed with prejudice all claims against

Independent. See Stip. of Dismissal with Prejudice [ECF No. 31]. Pursuant to the settlement,

Stewart transferred its interest in the breach of contract claim against Lewis to Independent. See

Feb. 16, 2018 Order [ECF No. 37] at 2. Independent filed a motion to substitute “in the place and

stead of Stewart” as plaintiff in this action, see Consent Mot. to Substitute [ECF No. 32], and the

Court granted that motion, see Feb. 16, 2018 Order at 3. The Court ordered that all pleadings and

dispositive motions filed by Stewart, as they relate to the breach of contract claim against Lewis,

be deemed adopted by Independent. Feb. 16, 2018 Order at 3. The sole issue, then, is whether

Independent is entitled to summary judgment on the breach of contract claim against Lewis.

LEGAL STANDARD

Summary judgment is appropriate where “the movant shows 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.

2 Lewis’ first opposition merely stated that he disputed the entirety of plaintiff’s statement of undisputed material facts, and that he “has complied with all federal law[] relating to this matter.” Lewis’ Opp’n to Pl.’s Mot. for Summ. J. [ECF No. 29]. After reviewing that filing, the Court issued a Fox/Neal order that advised Lewis of the consequences of failing to properly respond to a motion for summary judgment, and provided him with an opportunity to file an amended opposition. See Fox/Neal Order [ECF No. 33]. Lewis filed an amended opposition on November 1, 2017. See Lewis’ Am. Opp’n to Pl.’s Mot. for Summ. J. [ECF No. 35].

3 56(a). “The mere existence of some factual dispute is insufficient on its own to bar summary

judgment; the dispute must pertain to a ‘material’ fact.” Etokie v. Duncan, 202 F. Supp. 3d 139,

145 (D.D.C. 2016) (citation omitted). Hence, “[o]nly disputes over facts that might affect the

outcome of the suit under the governing law will properly preclude the entry of summary

judgment.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). Summary judgment may

not “be avoided based on just any disagreement as to the relevant facts; the dispute must be

‘genuine,’ meaning that there must be sufficient admissible evidence for a reasonable trier of fact

to find for the non-movant.” Etokie, 202 F. Supp. 3d at 146 (quoting Anderson, 477 U.S. at 248).

“A party asserting that a fact cannot be or is genuinely disputed must support that assertion

by” either “citing to particular parts of materials in the record, including depositions, documents,

electronically stored information, affidavits, . . . or other materials” or “showing that the materials

cited do not establish the absence or presence of a genuine dispute . . . .” Fed. R. Civ. P. 56(c)(1).

Conclusory assertions offered without any factual basis in the record cannot create a genuine

dispute. See Ass’n of Flight Attendants–CWA v. U.S. Dep’t of Transp., 564 F.3d 462, 465–66

(D.C. Cir. 2009). “If a party . . . fails to properly address another party’s assertion of fact . . . the

court may . . . consider the fact undisputed for purposes of the motion.” Fed. R. Civ. P. 56(e); see

Winston & Strawn, LLP v. McLean, 843 F.3d 503, 507 (D.C. Cir. 2016).

When deciding a motion for summary judgment, a court must regard the non-movant’s

statements as true and accept all evidence and make all inferences in the non-movant’s favor. See

Anderson, 477 U.S. at 255. Moreover, a court may not “make credibility determinations or weigh

the evidence.” Lopez v. Council on American–Islamic Relations Action Network, Inc., 826 F.3d

492, 496 (D.C. Cir. 2016) (citation omitted). Ultimately, a court must determine “whether the

evidence presents a sufficient disagreement to require submission to a jury or whether it is so one-

4 sided that one party must prevail as a matter of law.” Anderson, 477 U.S. at 251–52. Thus, a non-

moving party must “do more than simply show that there is some metaphysical doubt as to the

material facts,” Matsushita Elec. Indus. Co., Ltd. v. Zenith Radio Corp., 475 U.S. 574, 586 (1986),

and “[i]f the evidence is merely colorable, or is not significantly probative, summary judgment

may be granted,” Anderson, 477 U.S. at 249–50 (citations omitted).

DISCUSSION

Independent contends that it is entitled to summary judgment on the breach of contract

claim against Lewis. See Pl.’s Mot. for Summ. J. at 11. To prevail on a claim for breach of

contract under District of Columbia law, a plaintiff must establish: (1) a valid contract between the

parties, (2) an obligation or duty arising out of the contract, (3) breach of that obligation or duty,

and (4) damages caused by that breach. See Brown v. Sessoms, 774 F.3d 1016, 1024 (D.C. Cir.

2014) (quoting Tsintolas Realty Co. v. Mendez, 984 A.2d 181, 187 (D.C. 2009)).

Here, Independent has shown a valid contract between the parties, in the form of the

Subject Note which Lewis executed in November 2007,3 and Independent acquired on August 22,

2017. 4 See Subject Note at 1; see also Chase Plaza Condo. Ass’n, Inc. v. JPMorgan Chase Bank,

N.A., 98 A.3d 166, 169 (D.C. 2014) (holder of promissory note is normally entitled to enforce that

instrument (citing D.C. Code Ann. § 28:3-301)); Yasuna v. Miller, 399 A.2d 68, 72 (D.C. 1979)

(stating that a promissory note and a trust deed are different parts of a single contract). Under the

contract, Lewis had a duty to make monthly payments of principal and interest on the Subject Loan

until he paid in full the principal, interest, and any other charges incurred under the terms of the

3 In so executing, Lewis agreed that the Subject Note may be transferred and that such transfer does not relieve Lewis of his duty to make required payments. See Subject Note ¶ 1 (“I understand that the Lender may transfer this Note. The Lender or anyone who takes this Note by transfer and who is entitled to receive payments under this Note is called the ‘Note Holder.’”). 4 As explained in the Court’s Feb. 16, 2018 Order, see id. at 2, Stewart transferred the Subject Note to Independent’s professional liability insurer, who is authorized to bring claims in the name of Independent. For that reason, the Court simply states that Independent acquired the Subject Note on August 22, 2017.

5 Subject Note. See Subject Note ¶ 3. Independent has shown that Lewis breached his duty by

failing to make any payments on the Subject Loan after July 2013, notwithstanding that there was

an outstanding balance of $243,785.36 as of that date. 2nd Aff. of J. Thurbee ¶ 4; see Subject Note

¶ 6(B) (“If I do not pay the full amount of each monthly payment on the date it is due, I will be in

default.”). Independent has sustained damages as a result of that breach, in the form of being

denied payments to which it is entitled under the contract it has acquired. 2d Aff. of J. Thurbee

¶ 8; see Aspire Channel, LLC v. Penngood, LLC, 139 F. Supp. 3d 382, 388 (D.D.C. 2015) (denial

of compensation due under contract constitutes damages); Chatman Elec., Inc. v. Interior Sys.,

Inc., 433 F. Supp. 2d 91, 97–98 (D.D.C. 2006) (same).

Lewis has failed to provide any basis to deny summary judgment. His statements that he

has “complied with all Federal, State, and Local laws with respect to this matter,” and that the

“[l]egal records reveal nothing whatsoever on [his] behalf to precipitate this predicament,” Lewis’

Am. Opp’n to Pl.’s Mot. for Summ. J. at 1, are conclusory assertions offered without any factual

basis in the record—thus, they do not create a genuine dispute of material fact, Ass’n of Flight

Attendants–CWA, 564 F.3d at 465–66; Hussain v. Nicholson, 435 F.3d 359, 365 (D.C. Cir. 2006)

(conclusory allegations contained in a party’s own affidavit do not create a genuine issue of

material fact). His bare assertion that all of Independent’s stated material facts are “disputed,” see

Lewis’ Opp’n to Mot. for Summ. J. at 1, does not cite any record evidence that shows a genuine

dispute of fact. A party cannot render a fact “‘disputed’ by merely labeling it so.” Louis v. District

of Columbia, 59 F. Supp. 3d 135, 143 n.4 (D.D.C. 2014). Moreover, “[u]nless the opposing party

points to affirmative evidence showing disputed material facts, the court shall enter summary

judgment, if appropriate, against the adverse party.” Jackson v. Finnegan, Henderson, Farabow,

Garrett & Dunner, 101 F.3d 145, 150 (D.C. Cir. 1996) (citation omitted); see also Buruca v.

6 District of Columbia, 902 F. Supp. 2d 75, 82 (D.D.C. 2012) (“The plaintiff can defeat the District’s

motion only if it points to ‘particular facts’ supported by ‘materials in the record’ to dispute the

District’s version of the story.” (quoting Fed. R. Civ. P. 56(c)(1)(A)). Finally, Lewis’ assertion

that he purchased title insurance on the property is wholly irrelevant to whether he breached the

terms of the Subject Note. In the end, he does not even assert that he made such payments, much

less identify any evidence that would support such an assertion. Hence, the Court concludes that

Independent is entitled to summary judgment on the breach of contract claim.

CONCLUSION

For the reasons explained above, Independent’s motion for summary judgment on the

breach of contract claim against Lewis will be granted. A separate order has been issued on this

date.

/s/ JOHN D. BATES United States District Judge Dated: February 16, 2018