Opinion
Civil Action No. 03-1373 Section: "R"(2).
July 21, 2004
ORDER AND REASONS
Before the Court is the motion of plaintiff, Bank One, N.A., for summary judgment for reimbursement of overpaid rent amounts, plus interest. For the following reasons, the Court GRANTS Bank One's motion for summary judgment.
I. Background
Defendant, A. Levet Properties Partnership, leased to First National Bank of Commerce ("FNBC") commercial property located at 4545 Veteran's Memorial Highway in Jefferson Parish, Louisiana. Plaintiff, Bank One, N.A., is the successor in interest to the lease agreement for the commercial property through a merger with FNBC. A dispute arose between A. Levet and Bank One as to the amount of rent due under the lease.
On April 30, 2004, this Court granted a partial summary judgment to Bank One on its claim that the amount of monthly rent due under the lease was $20,734.54, as provided in the lease agreement. Bank One asserts that it mistakenly paid $25,301.20 per month in rent from August 1998 to October 2002. Thus, Bank One argues that for a period of 51 months, it overpaid $4,566.66 each month, for a total of $232,899.66 in overpayments. Bank One now seeks summary judgment ordering A. Levet to return the overpaid rent and to pay prejudgment and postjudgment interest.
A. Levet contends, on the other hand, that several issues remain unresolved which preclude summary judgment. First, A. Levet renews its argument that Bank One is not the successor in interest to the lease and is not a proper party to the action. Second, A. Levet argues that even if Bank One is the successor in interest to the lease and is a proper party to the action, there are issues of material fact which preclude summary judgment (a) as to the amount of damages to which Bank One is entitled and (b) as to when interest began to accrue.
II. Discussion
A. Legal Standard
Summary judgment is appropriate when there are no genuine issues as to any material facts, and the moving party is entitled to judgment as a matter of law. See FED. R. Civ. P. 56(c); Celotex Corp. v. Catrett, 477 U.S. 317, 322-323 (1986). A court must be satisfied that no reasonable trier of fact could find for the nonmoving party or, in other words, "that the evidence favoring the nonmoving party is insufficient to enable a reasonable jury to return a verdict in her favor." Lavespere v. Niagara Mach. Tool Works, Inc., 910 F.2d 167, 178 (5th Cir. 1990) ( citing Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 249 (1986)). The moving party bears the burden of establishing that there are no genuine issues of material fact.
If the dispositive issue is one on which the nonmoving party will bear the burden of proof at trial, the moving party may satisfy its burden by merely pointing out that the evidence in the record contains insufficient proof concerning an essential element of the nonmoving party's claim. See Celotex, 477 U.S. at 325; see also Lavespere, 910 F.2d at 178. The burden then shifts to the nonmoving party, who must, by submitting or referring to evidence, set out specific facts showing that a genuine issue exists. See Celotex, 477 U.S. at 324. The nonmovant may not rest upon the pleadings, but must identify specific facts that establish a genuine issue exists for trial. See id. at 325; Little v. Liquid Air Corp., 37 F.3d 1069, 1075 (5th Cir. 1996).
The Fifth Circuit has "arguably articulated an even more lenient standard for summary judgment in certain nonjury cases." Phillips Oil Co. v. OKC Corp., 812 F.2d 265, 273 n. 15 (5th Cir. 1987); see also Chinchilla v. United States, 1999 WL 993640, at *2 (E.D.La.). In Nunez v. Superior Oil Co., 572 F.2d 1119, 1123-24 (5th Cir. 1978), the Fifth Circuit explained:
If decision is to be reached by the court, and there are no issues of witness credibility, the court may conclude on the basis of the affidavits, depositions, and stipulations before it, that there are no genuine issues of material fact, even though [its] decision may depend on inferences to be drawn from what has been incontrovertibly proved.
Therefore, in a nonjury case, such as this case, the Court is encouraged to draw inferences, even when they appear to be factual, if a "trial on the merits would reveal no additional data." Id. at 1124; see also Professional Geophysics, Inc. v. Placid Oil Co., 932 F.2d 394, 398 (5th Cir. 1991).
B. Choice of Law
The parties do not dispute and the Court has found that Louisiana law governs this controversy.
C. Analysis
Bank One now moves for summary judgment on its claim for reimbursement of the amounts of rent it overpaid under Louisiana Civil Code Article 2299. Article 2299 provides that "[a] person who has received a payment or a thing not owed him is bound to restore it to the person from whom he received it." LA. CIV. CODE ANN. art. 2299. In its earlier ruling, the Court rejected A. Levet's arguments that the voluntary payment doctrine prevents Bank One from recovering under Article 2299. A. Levet raises no other arguments under Article 2299 in response to Bank One's present motion. Rather, A. Levet now renews its argument that Bank One is not the appropriate entity to seek repayment. It also argues that the amount of damages and interest are uncertain.
1. Bank One is the Successor in Interest to the Lease
A. Levet argues first that Bank One, N.A. is not entitled to summary judgment on its claim because it fails to meet its burden of proof to establish that it acquired FNBC's rights under the lease with A. Levet. This Court has already rejected this argument once, and it does not deviate from its earlier ruling that Bank One is the successor in interest to the lease. See R. Doc. 41. To support its first motion for summary judgment, Bank One attached the affidavit of its senior counsel, Thomas Hennessey, on this issue. A. Levet submitted nothing to controvert it. In support of its present motion for summary judgment, Bank One offers the affidavit of its cashier and a certificate from the Office of the Comptroller of the Currency (OCC) demonstrating that Bank One is the successor in interest to FNBC through mergers. ( See Pl.'s Reply Mem. Supp. Mot. Summ. J. Ex. B.)
A. Levet points out that Hennessey testified that FNBC merged with Bank One, N.A., but the cashier now attests that FNBC merged with Bank One, Louisiana, N.A. on November 16, 1998, which then merged into Bank One, N.A. on February 8, 2001. A. Levet does not explain why or how this information indicates that plaintiff Bank One, N.A. is not the successor in interest to the lease. Ultimately, this evidence shows only that Bank One, N.A. acquired the lease in a two-step process. It does not, as A. Levet contends, reveal inherently contradictory information that creates an issue of material fact to defeat the summary judgment motion. A. Levet offers no other evidence to dispute that Bank One, N.A. is the successor in interest to the lease. The Court again rejects A. Levet's argument that Bank One, N.A. is not entitled to summary judgment on this ground.
2. Bank One, N.A. is a Proper Party
A. Levet also argues that Bank One, N.A. is not a proper party to the litigation because (1) Bank One, Texas, N.A., (2) Banc One Building Corp., and (3) Bank One Corporation issued rent checks during the relevant period. Bank One, N.A. has demonstrated that it is the successor in interest to the lease. It submits the affidavit of its Vice President of Real Estate Transactions who avers that Bank One overpaid the rent. That affiliates of Bank One cut the rent checks on its behalf does not prevent the successor lessee from recovering the amounts overpaid on its behalf. Accordingly, the Court rejects A. Levet's argument that Bank One is not entitled to recovery on this ground.
3. Date of Merger
A. Levet argues that the date of the merger between FNBC and Bank One is disputed. To support its contention, A. Levet notes that the Comptroller's Certificate lists November 16, 1998 as the date of the merger, but Bank One seeks reimbursement for overpaid rent from August 1998 through October 2002. Contrary to A. Levet's assertion, there is no dispute as to the date of the merger. The Comptroller's Certificate shows that the banks merged on November 16, 1998. The evidence also contains copies of rent checks that Bank One made out to A. Levet in the amount of $25,301.20 for August, September, and October 1998. A. Levet does not dispute that it received those checks in payment of the rent under the lease. A. Levet gives no reason why the successor in interest to the lease may not recover overpayments of rent that it made before the effective date of the merger through which it acquired its interest. Indeed, its predecessor in interest, FNBC, no longer exists. As successor in interest to the lease, Bank One is entitled to recover overpayments of rent under the lease, even those paid before FNBC officially merged into Bank One. See generally 49 Am.Jur. 2D Landlord and Tenant § 60 ("[A] successor in interest to an original party to the lease may maintain a suit upon the lease, if the successor in interest proves that he is the real party in interest."). The effective date of the merger is neither unclear nor does it create an issue of material fact. A. Levet's argument is without merit.
4. A. Levet's Counterclaim
A. Levet counterclaims that Bank One breached its contract with A. Levet by failing to repair the parking lot on the property. A. Levet argues that its potential recovery on its counterclaim creates uncertainty as to the total amount it owes Bank One and therefore precludes summary judgment on the reimbursement of overpaid rent amounts. A. Levet is incorrect. A claim for compensation cannot preclude summary judgment when the compensation claim is unliquidated. American Bank v. Saxena, 553 So.2d 836, 845 (La. 1989). See also National Gypsum Co. v. Ace Wholesale, Inc., 685 So.2d 306, 310 (La.App.Ct. 1997) (noting that "[i]t is clear under our jurisprudence that a claim for offset or compensation is not sufficient to prevent summary judgment on a liquidated debt where the compensation is not liquidated"). A liquidated claim is capable of ascertainment by mere calculation. Saxena, 553 So.2d at 844. An unliquidated claim is not capable of ascertainment by mere calculation. Id. Currently, it is unclear whether A. Levet will prevail on its counterclaim and, if it does prevail, the amount to which it is entitled. Thus, A. Levet's counterclaim is not ascertainable by mere calculation and is therefore unliquidated. Because A. Levet's counterclaim is unliquidated, it cannot preclude summary judgment.
5. Interest
Finally, A. Levet disputes the time at which prejudgment interest began to accrue on the overpaid amounts. State law governs the calculation of prejudgment interest. DP Solution, Inc. v. Rolling, Inc., 353 F.3d 421, 435 (5th Cir. 2003). Louisiana Civil Code Article 2000 states that interest begins to accrue from the time that the sum is due. The sum is due from the time that the plaintiff demanded reimbursement of the overpaid amounts, so long as the amount of overpayment was ascertainable at that time. Texaco Trading and Transp. v. Van Petroleum, Inc., 1996 WL 89274 at *3-4 (E.D. La. March 1, 1996) (awarding interest from the date of the demand letter for reimbursement of overpaid amounts). Cf. Alexander v. Burroughs Corp., 359 So.2d 607, 613-14 (La. 1978) (awarding interest from the date plaintiff's attorney sent demand letter).
In this case, Bank One contends that interest began to accrue in November 2002. Bank One offers the affidavit of Cynthia Alderson to show that interest began to accrue in November 2002. (Pl.'s Mem. In Supp. Summ. J. Ex. C.) Alderson attests that Bank One informed A. Levet of the overpayment in November 2002 and demanded reimbursement at that time. A. Levet points out that parties thereafter entered a 60-day forbearance agreement. The agreement merely provided that Bank One would pay $20,734.54 per month in rent, that A. Levet would not treat such payment as a complete default under the lease, and that both parties reserved all of their rights to recover underpayments or overpayments of rent from each other. The agreement made no provision for the suspension of the accrual of interest. A. Levet offers nothing to contradict the information contained in the Alderson affidavit. Accordingly, the Court finds that Bank One notified A. Levet and demanded reimbursement in November 2002, as stated in the Alderson affidavit.
The amount of overpayment was ascertainable in November 2002: the amount owed under the lease was $20,734.54 per month, and Bank One erroneously paid $25,301.20 per month. Thus, Bank One overpaid $4,566.66 each month for a total of $232,899.66. A. Levet's initial challenge to the amount owed under the lease does not mean that the amount was not ascertainable for the purpose of calculating prejudgment interest. See Texaco Trading and Transp., 1996 WL at *3 (finding that defendant's questioning of the accuracy of plaintiff's demand cannot serve to penalize plaintiff in determination of accrual of interest).
Because Bank One demanded reimbursement for overpaid amounts in November 2002 and the amount owed was ascertainable at that time, interest began to accrue in November 2002. The rate of legal interest that applies to the rent overpayments is 5.75 percent, as determined by the Louisiana Office of Financial Institutions under La.R.S. 13:4202.
Additionally, under 28 U.S.C. § 1961, Bank One will be entitled to postjudgment interest. See also DP Solutions, 353 F.3d at 435 (noting that postjudgment interest is calculated according to federal law). This interest shall be calculated from the date of entry of the judgment. The rate of interest will be the weekly average constant maturity Treasury yield, as published by the Board of Governors of the Federal Reserve System for the calendar week preceding the date of judgment. 28 U.S.C. § 1961(a).
III. Conclusion
For the foregoing reasons, the Court grants Bank One's motion for summary judgment and declares that A. Levet owes $232,899.66 in overpaid rent, plus prejudgment interest at the rate of 5.75 percent.