Opinion
Civ. No. 99-2806, SECTION "T" (5)
May 30, 2000
Before this Court is a Motion for Summary Judgment, filed on behalf of the United States of America, which came for hearing on May 24, 2000. Oral argument was waived by the parties and the matter was submitted for the Court's consideration on the briefs only. The Court, having reviewed the memorandum of the United States of America, the record, the applicable law, and the failure of defendant to file an opposition to the government's motion, is fully advised of the premises of this case and is ready to rule.
ORDER AND REASONS
I. BACKGROUND
Defendant, Kelly A. Paliaro, applied for and received a Guaranteed Student Loan ("GSL"). On December 26, 1986, the defendant executed and delivered a promissory note payable to Marine Midland Bank, N.A., Newport Beach, CA ("Marine Midland"), in the amount of $2,500.00, promising to repay the loan plus interest at a rate of eight percent (8%) per annum. The loan was guaranteed by Northstar Guarantee, Inc. ("Northstar") and reinsured by the Department of Education ("DOE"). The defendant subsequently defaulted on the loan. As a result of Paliaro's default, the holder of the note filed a claim on the guarantee commitment and transferred the note to Northstar. DOE, in turn, paid Northstar for Paliaro's GSL under the reinsurance contract, and eventually took assignment of the note.
The government now moves for summary judgment claiming that as of June 24, 1999, the defendant owes the United States $5,101.61, with interest accruing on the principal amount at the rate of eight percent (8%) per annum or at the daily rate of $0.63 from June 24, 1999, to date of judgment.
II. LAW AND ARGUMENT
Rule 56(c) of the Federal Rules of Civil Procedure provides that summary judgment should be granted "if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." Fed.R.Civ.P. 56 (c). The party moving for summary judgment bears the initial responsibility of informing the district court of the basis for its motion, and identifying those portions of the record which it believes demonstrate the absence of a genuine issue of material fact." Stults v. Conoco, 76 F.3d 651 (5th Cir. 1996), (citingSkotak v. Tenneco Resins, Inc., 953 F.2d 909, 912-13 (5th Cir. 1992) (quoting Celotex Corp. v. Catrett, 477 U.S. 317, 323, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986)). When the moving party has carried its burden under Rule 56(c), its opponent must do more than simply show that there is some metaphysical doubt as to the material facts. The nonmoving party must come forward with "specific facts showing that there is a genuine issue for trial."Matsushita Elec. Industrial Co. v. Zenith Radio Corp., 475 U.S. 574, 588, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986); see also,Tubacex, Inc. v. M/V Risan, 45 F.3d 951, 954 (5th Cir. 1995).
Thus, where the record taken as a whole could not lead a rational trier of fact to find for the nonmoving party, there is no "genuine issue for trial." Matsushita Elec. Industrial Co., 475 U.S. at 588. Finally, the Court notes that the substantive law determines materiality of facts and only "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, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986).
Further, it is well established in the Fifth Circuit that suits on promissory notes are appropriate questions for summary judgment. FDIC v. Cardinal Oil Well Servicing Co., Inc., 837 F.2d 1369, 1371 (5th Cir. 1988). A prima facie case on a promissory note is established when the "plaintiff alleges that it is the holder and owner of the note and that the note is in default."United States v. Nelson, 821 F. Supp. 1137, 1138 (W.D.La. 1993)(citing, American Bank v. Saxena, 553 So.2d 836, 842 (La. 1989). The burden then shifts to the defendant to establish the nonexistence, extinguishment or variance in payment of the obligation. United States v. Irby, 517 F.2d 1042, 1043 (5th Cir. 1975); United States v. Ward, 1992 WL 373557, *2. In the absence of such proof, summary judgment in favor of the plaintiff is appropriate. Id.
Here, the United States produced the promissory note signed by Paliaro. The United States has also established that it was assigned all rights, title and interest in the promissory note, thus proving that it is the owner of the promissory note. Further, the United States has established that the defendant defaulted on the GSL she received. As such, the United States has shown a prima facie case. As defendant did not file an opposition to this summary judgment motion, she has failed to met her burden in proving that the debt does not exist or was extinguished.
Accordingly,
IT IS ORDERED that the Motion for Summary Judgment filed on behalf of the plaintiff, United States of America, be and the same is hereby GRANTED.
New Orleans, Louisiana, this 30th day of May, 2000.