MEMORANDUM DECISION DENYING DEBTOR'S MOTION FOR SUMMARY JUDGMENT [Docket Number 6]
BETH A. BUCHANAN, Bankruptcy Judge.
This matter is before this Court on the Debtor's Motion for Summary Judgment [Docket Number 6]; and the Judgment Creditors' Response in Opposition to Debtor's Motion for Summary Judgment [Docket Number 12].
On summary judgment, Defendant-Debtor Suzanne Bair ("Debtor") argues that an agreed order entered in a foreclosure action distributing $4,899.70 in proceeds to Plaintiff Kingston Development Group, LLC ("Kingston") from the sale of real property bars the Plaintiffs from pursuing claims against the Debtor personally in this adversary proceeding. The Debtor bases her arguments on preclusionary doctrines including claim and issue preclusion, judicial estoppel, judicial admission, mootness, and single-satisfaction.
For the reasons that follow, this Court denies summary judgment. Genuine issues of material fact exist regarding the agreed order entered in the foreclosure action and whether it represents an adjudication or satisfaction of any claims against the Debtor personally. Accordingly, the Debtor fails to demonstrate the applicability of preclusionary doctrines to bar the Plaintiffs' claims against the Debtor as a matter of law.
I. JURISDICTION
This Court has jurisdiction over this matter pursuant to 28 U.S.C. §§ 157(a) and 1334, and the standing General Order of Reference in this District. This is a core proceeding pursuant to 28 U.S.C. § 157(b)(2)(I). Both parties have consented to this Court entering a final judgment in the adversary proceeding [Docket Number 13, Section II. E].
II. BACKGROUND
The following factual background is undisputed except where stated. On July 30, 2018, Debtor filed her Chapter 7 bankruptcy petition. Subsequently, Plaintiff-Creditors Barestone, LLC ("Barestone") and Kingston (collectively "Plaintiffs") filed an adversary complaint against the Debtor requesting a judgment of at least $200,000 and a determination that the debt is nondischargeable pursuant to 11 U.S.C. § 523(a)(2)(A), (a)(2)(B), (a)(4) and (a)(6). According to the adversary complaint, the debt arises from a soured real estate development project between the Plaintiffs and Bair Build, Co. LLC ("Bair Build"), a company allegedly owned and operated by the Debtor. According to the adversary complaint, Kingston and Bair Build formed Barestone in November of 2015 for the purpose of acquiring and developing the real property located at 1531 and 1533 Republic Street in Cincinnati, Ohio (the "Republic Street properties"). At its core, the adversary complaint alleges that the Debtor and Bair Build mismanaged the real estate development project and the Debtor used Bair Build to defraud the Plaintiffs.
On November 21, 2018, the Debtor filed her motion for summary judgment in the adversary proceeding asserting the relevance of several lawsuits involving the real estate development project that preceded the bankruptcy filing. First, in September of 2017, the Plaintiffs filed a complaint in the Hamilton County Court of Common Pleas against the Debtor, Bair Build, and others captioned Barestone, LLC, et al. v. Bair Build, Co., LLC, et al., Case No. A1704728 ("Barestone I") [Docket Number 6, Ex. 2]. The Barestone I first amended complaint is incorporated into the Plaintiffs' adversary complaint by reference [Docket Number 1, Ex. E].1 In the Barestone I first amended complaint, the Plaintiffs alleged claims against the Debtor and other defendants including breach of contract, breach of fiduciary duties, fraud, conversion, promissory estoppel, fraudulent transfers and punitive damages [Id.]. It is undisputed that no judgment was rendered in Barestone I.
In addition to Barestone I, the Debtor asserts that the real estate development project was the subject of a separate proceeding in the Hamilton County Court of Common Pleas captioned Union Savings Bank v. Barestone, LLC, et al., Case No. A1706729 ("Barestone II") [Docket Number 6, Ex. 3]. Unlike Barestone I, Barestone II was a foreclosure action initiated by Union Savings Bank as the holder of a construction note with Barestone, a mortgage lien against one of the Republic Street properties, and a cognovit judgment against Barestone, DJ Bair (the Debtor's son), and the Debtor in the amount of $290,847.33 [Docket Number 12, Ex. A]. In the foreclosure action, Barestone filed an answer to Union Savings Bank's complaint and also filed cross-claims and a third-party complaint against Bair Build and the Debtor, among others [Docket Number 6, Ex. 3]. Barestone's third-party complaint against the Debtor incorporated the allegations and demand for judgment found in its Barestone I complaint [Id.].2
The Debtor asserts that, in the spring of 2018, the Hamilton County Court of Common Pleas issued a judgment and decree of foreclosure in Barestone II, although the judgment and decree of foreclosure are not produced by the Debtor on summary judgment. The Debtor further asserts, without supporting evidence, that the foreclosed Republic Street property was then sold at sheriff sale, liens were paid off, and excess funds were available. According to the Debtor, Kingston asserted entitlement to the excess proceeds from the sale. On October 18, 2018, the Hamilton County Court of Common Pleas entered an Agreed Order Regarding Release of Sheriff Sale Proceeds ("Barestone II Agreed Order") directing that $4,899.70 of the proceeds be distributed to "Kingston Development, LLC in satisfaction of any liens, claims, or encumbrances on the real property that was the subject of the action in Case Number A1706729." [Id., Ex. 4]. The Debtor argues that the Barestone II Agreed Order resolves all claims Kingston had against the Debtor thus barring Plaintiffs from advancing claims against the Debtor in this adversary proceeding.3
In response to the Debtor's motion for summary judgment, the Plaintiffs assert that the Barestone II Agreed Order resolved only Kingston's claims against a parcel of real property and not Kingston's claims against the Debtor personally, which have never been litigated or resolved. As support, Plaintiffs note that, prior to entry of the Barestone II Agreed Order, the Plaintiffs attempted to consolidate their claims against the Debtor in Barestone I with the Barestone II foreclosure action. However, the Hamilton County Court of Common Pleas denied Plaintiffs' motion to consolidate concluding:
. . . that the interest of judicial economy would not be served by consolidation and that the cases involve separate and distinct matters with minimal substantive commonality. Specifically, the Union Savings Bank case is a foreclos[ure] action upon a mortgage based upon a monetary judgment already awarded as the result of a cognovit note; in contrast, the above-captioned case essentially arises from alleged misfeasance or malfeasance by certain members of a limited-liability company or others, resulting in conditions that apparently caused the default on the promissory note and the ensuing foreclosure action. The claims, as well as the relevant evidence, in each case is significantly separate and distinct that commonality is lacking and judicial economy would not be served by even consolidation of discovery. [Docket Number 12, Ex. C]. Accordingly, the Plaintiffs assert that the distribution of proceeds in the foreclosure action does not preclude them from asserting the claims in this adversary proceeding.
The Debtor did not file a reply and the matter is now ready for determination.
III. SUMMARY JUDGMENT STANDARD
This Court addresses the Debtor's motion for summary judgment under the standard set forth in Rule 56(a) of the Federal Rules of Civil Procedure (the "Civil Rules") made applicable to this proceeding by Rule 7056 of the Federal Rules of Bankruptcy Procedure. Civil Rule 56(a) provides that summary judgment is to be granted by this Court "if the movant shows that 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. 56(a). "As to materiality, the substantive law will identify which facts are material. Only 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). A "genuine" dispute exists only where "evidence is such that a reasonable [finder of fact] could return a [judgment] for the nonmoving party." Id.; Gallagher v. C.H. Robinson Worldwide, Inc., 567 F.3d 263, 270 (6th Cir. 2009).
In order to prevail, the moving party, if bearing the burden of persuasion at trial, must establish all elements of its claim. Celotex Corp. v. Catrett, 477 U.S. 317, 331 (1986). If the burden is on the non-moving party at trial, the movant must: 1) submit affirmative evidence that negates an essential element of the nonmoving party's claim or 2) demonstrate to the court that the nonmoving party's evidence is insufficient to establish an essential element of the nonmoving party's claim. Id. at 331-32. Thereafter, the opposing party "must come forward with `specific facts showing that there is a genuine issue for trial.'" Matsushita Elec. Indus. Co., Ltd. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986) (citations omitted); Anderson, 477 U.S. at 249-51.
All inferences drawn from the underlying facts must be viewed in a light most favorable to the party opposing the motion. Matsushita, 475 U.S. at 587-88. Nonetheless, mere conclusory allegations or unsupported opinions of the nonmovant are insufficient to defeat a motion for summary judgment. Id. See also Blaney v. Cengage Learning, Inc., 2011 U.S. Dist. LEXIS 43780, at *19-20, 2011 WL 1532032, at *7 (S.D. Ohio Apr. 22, 2011).
IV. LEGAL ANALSYIS
The Debtor asserts that the Barestone II Agreed Order, releasing $4,899.70 in proceeds to Kingston following the foreclosure and sheriff sale of one of the Republic Street properties, bars the Plaintiffs from bringing claims against the Debtor in this adversary proceeding. The Debtor argues the applicability of several preclusionary doctrines including claim and issue preclusion, judicial estoppel, judicial admission, mootness, and single-satisfaction. The Debtor asserts, that whichever doctrine this Court chooses to apply, they all compel the same result — "Kingston's claim has been satisfied and cannot be raised here." [Docket Number 6, p. 10].
The Plaintiffs dispute that their claims against the Debtor have been adjudicated in the foreclosure action and satisfied through the Barestone II Agreed Order. Indeed, a review of the Barestone II Agreed Order reveals no express findings of facts or conclusions of law with respect to the Debtor nor does the evidence produced by the Debtor on summary judgment demonstrate that the state court held a trial or otherwise determined claims against the Debtor. Instead, the Barestone II Agreed Order distributes $4,899.70 in sale proceeds to Kingston "in satisfaction of any liens, claims, or encumbrances on the real property that was the subject of the action in Case No. A1706729." [Docket Number 6, Ex. 4 (emphasis added)]. Thus, on its face, the Barestone II Agreed Order satisfies only Kingston's claims against a parcel of real property and not claims against the Debtor.
Furthermore, the Plaintiffs provide evidence to support that the Hamilton County Court of Common Pleas denied a request to consolidate the claims against the Debtor in Barestone I with the foreclosure action in Barestone II [Docket Number 12, Ex. C]. In its Entry Denying Motion to Consolidate, the Hamilton County Court of Common Pleas found a lack of commonality between the "misfeasance or malfeasance" claims raised against the Debtor and others in Barestone I with the matters addressed in the Barestone II foreclosure action and finally determined that the matters should not be consolidated, even with respect to discovery [Id.]. The Debtor filed no reply to refute the Plaintiffs' arguments or evidence.
At the very least, the Plaintiffs raise genuine issues of material fact regarding whether the Barestone II Agreed Order represents an adjudication or satisfaction of the Plaintiffs' claims against the Debtor raised in Barestone I and this adversary proceeding. Accordingly, the Debtor has failed to demonstrate the applicability of any preclusionary doctrine to bar the Plaintiffs' claims as a matter of law. Summary judgment is, therefore, denied.
V. CONCLUSION
For the reasons stated above, Debtor's Motion for Summary Judgment [Docket Number 6] is DENIED.
SO ORDERED.
