United States District Court, E.D. Michigan, Southern Division
PNC BANK, National Association, successor by merger to National City Bank, a national banking association, Plaintiff,
LEGAL ADVOCACY, P.C., a Michigan Professional Corporation, f/k/a NORMAN YATOOMA & ASSOCIATES, P.C. and NORMAN YATOOMA, Defendants.
OPINION AND ORDER DENYING DEFENDANTS' MOTION FOR
SUMMARY JUDGMENT [ECF No. 18] AND PLAINTIFF'S MOTION FOR
SUMMARY JUDGMENT [ECF No. 20]
V. PARKER U.S. DISTRICT JUDGE.
September 9, 2016, Plaintiff PNC Bank commenced this lawsuit
alleging a breach of promissory note and breach of the
guaranty against Defendant Legal Advocacy, P.C., f/k/a Norman
Yatooma & Associates, P.C. and Defendant Norman A.
Yatooma (collectively “Defendants”). (ECF No. 1.)
Presently before the Court are the parties' cross motions
for summary judgment filed April 18, 2017 and May 12, 2017,
respectively. (ECF Nos. 18 & 20.) The motions have been
the facts and legal arguments sufficiently presented in the
parties' briefs, the Court dispensed with oral argument
pursuant to Eastern District of Michigan Local Rule 7.1(f).
For the reasons that follow, the Court denies the
parties' cross-motions for summary judgment.
Factual and Procedural Background
August 27, 2008, Plaintiff extended credit to Defendant Legal
Advocacy in the amount of $ 1, 500, 000, which was executed
by a Promissory Note and secured with a Commercial Guaranty.
(ECF No. 1 at Pg ID 3-4, 9-10, 18-21.) Defendant Yatooma
executed the Commercial Guaranty and agreed to be financially
responsible for the indebtedness of Defendant Legal Advocacy.
(ECF No. 1 at Pg ID 4, 18-21.) The Note provided that payment
would be due upon demand. (ECF No 1 at Pg ID 9.)
response to a conversation on April 27, 2010 with Defendant
regarding his refusal to sign new commercial loan
documentation, Plaintiff sent Defendants a demand letter on
April 30, 2010. (ECF No. 1 at Pg ID 3, 12-13.) The letter
sought full payment of the debt no later than June 30, 2010.
(Id.) Having received no payment by June 30, 2010,
on August 9, 2010, Plaintiff sent Defendants a second demand
letter. (ECF No. 1 at Pg ID 3, 15.) On September 27, 2010 and
October 28, 2010, Defendant Legal Advocacy wrote Plaintiff
two separate checks in the amounts of $3, 550.37 and $3,
September 9, 2016, Plaintiff instituted this action. As of
the filing of the Complaint, Defendants owed a principal
balance of $1, 499, 276.36, accrued interest in the amount of
$249, 203.12, and late fees in the amount of $12, 335.22,
totaling $1, 759, 814.70. (ECF No. 1 at Pg ID 4.) In
response, Defendants filed a motion for summary judgment
claiming Plaintiff's claims are barred by the statute of
limitations. (ECF No. 18.) Plaintiff filed a cross-motion for
summary judgment arguing Defendants breached their
contractual obligation and its claim was revived, at the
latest, when Defendant Legal Advocacy made a payment on
October 28, 2010. (ECF No. 20.)
Summary Judgment Standard
judgment pursuant to Federal Rule of Civil Procedure 56 is
appropriate “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). The central inquiry is “whether the evidence
presents a sufficient disagreement to require submission to a
jury or whether it is so one-sided that one party must
prevail as a matter of law.” Anderson v. Liberty
Lobby, Inc., 477 U.S. 242, 251-52 (1986). After adequate
time for discovery and upon motion, Rule 56 mandates summary
judgment against a party who fails to establish the existence
of an element essential to that party's case and on which
that party bears the burden of proof at trial. Celotex
Corp. v. Catrett, 477 U.S. 317, 322 (1986).
movant has the initial burden of showing “the absence
of a genuine issue of material fact.” Id. at
323. Once the movant meets this burden, the “nonmoving
party must come forward with specific facts showing that
there is a genuine issue for trial.” Matsushita
Electric Indus. Co. v. Zenith Radio Corp., 475 U.S. 574,
587 (1986) (internal quotation marks and citation omitted).
To demonstrate a genuine issue, the nonmoving party must
present sufficient evidence upon which a jury could
reasonably find for that party; a “scintilla of
evidence” is insufficient. See Liberty Lobby,
477 U.S. at 252.
party asserting that a fact cannot be or is genuinely
disputed” must designate specifically the materials in
the record supporting the assertion, “including
depositions, documents, electronically stored information,
affidavits or declarations, stipulations, admissions,
interrogatory answers, or other materials.”
Fed.R.Civ.P. 56(c)(1). The court must accept as true the
non-movant's evidence and draw “all justifiable
inferences” in the non-movant's favor. See
Liberty Lobby, 477 U.S. at 255.
Applicable Law & Analysis
Michigan law, the statute of limitations for a breach of
contract claim is six years. See Mich. Comp. Laws
§ 600.5807(8). However, a partial payment on a loan will
restart the running of the limitations period. See Yeiter
v. Knights of St. Casimir Aid Soc'y, 461 Mich. 493,
497 (Mich. 2000) (“A partial payment made on a debt
after the debt matures serves to revive the statute of
limitations. A new cause of action accrues on the date of
payment.”); Buchanan v. Northland Group, 776
F.3d 393, 396 (6th Cir. 2015) (partial payments on a
time-barred debt restarts the statute of limitations under
Michigan law); Fed. Deposit Ins. Corp. v. Garbutt,
142 Mich.App. 462, 468 (Mich. Ct. App. 1985) (“An
action on a promissory note is subject to the six-year
statutory limitation period governing breach of contract
actions . . .”). However, the debt must be
“accompanied by a declaration or circumstance that
rebuts the implication that the debtor by partial payment
admits the full obligation.” Yeiter, 461 Mich.
at 497 n.6; see also Charbonneau v. Mary Jane Elliott,
P.C., 611 F.Supp.2d 736, 741 (E.D. Mich. 2009).
Moreover, “[a] qualification must be made at the time
of the partial payment. If this were not true, it would be
possible for one to make a partial payment and intend to pay
the balance at a later date, but in the interim, change his
mind and effectively [renege].” Bonga v.
Bloomer, 14 Mich.App. 315, 319 (Mich. Ct. App. 1968).
their motion for summary judgment, Defendants claim
Plaintiff's suit is barred by the six-year statute of
limitations, which began to accrue on either April 30, 2010,
the date of default/demand, or June 30, 2010, the date
payment was expected to be paid in full. To the contrary,
Plaintiff argues that the statute of limitations was revived
because Defendant Legal Advocacy made two partial payments on
September 27, 2010 and October 28, 2010. Under Michigan law,
Plaintiff's position would be correct assuming the
September and October payments were, in fact, partial
payments and unaccompanied by a declaration rebutting full
obligation to the debt. See Yeiter, 461 Mich. at
497; Buchanan, 776 F.3d at 396; Fed. Deposit
Ins. Corp. v. Garbutt, 142 Mich.App. at 468. However,
whether the two payments were made to advance settlement
negotiations or were a new promise to pay is a disputed fact.
Notably, Defendants concede in their response to
Plaintiff's motion for summary judgment that the nature
of the two payments is a disputed fact and cannot be decided
without the benefit of discovery. (ECF No. 22 at Pg ID 341.)
The Court agrees. Depending on the nature of the two
payments, Plaintiff's Complaint may be time-barred.
Neither party has provided the Court with any evidence to
support their claims ...