Montoya v. Salcido

UNITED STATES BANKRUPTCY COURT
DISTRICT OF NEW MEXICO
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06/10/06
Philip J. Montoya v. Isidro Salcido
04-01234
Order Denying [28-1] Motion To Reconsider Order [26-1] by Philip J. Montoya .
Received on: 2005-12-01 10:07:20.000
2005-12-01 00:00:00.000
2005-12-01 00:00:00.000
Patti Hennessy
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UNITED STATES BANKRUPTCY COURT
DISTRICT OF NEW MEXICO
In re: GENERAL WASTE CORPORATION, No. 7-02-11881 MA
Debtor.
_____________________________________________________________________________
PHILIP J. MONTOYA, Chapter 7 Trustee,
Plaintiff,
v. Adversary No. 04-1234 M
ISIDRO SALCIDO,
Defendant.
ORDER DENYING MOTION FOR RECONSIDERATION
THIS MATTER is before the Court on the Motion for Reconsideration filed on November 17,
2005 by Plaintiff, Philip J. Montoya, Chapter 7 Trustee, by and through his attorney of record, Steve
H. Mazer. The Motion for Reconsideration requests the Court to reconsider its Memorandum and
Order entered in this adversary proceeding granting summary judgment in favor of Defendant.
The Court entered its Order on October 7, 2005, and entered its Memorandum on November
7, 2005. Motions for reconsideration filed within ten days of the entry of a judgment or order are
governed by Rule 59(e), Fed.R.Civ.P., as incorporated into the bankruptcy rules by Rule 9023,
Fed.R.Bankr.P. See Buchanan v. Sherrill, 51 F.3d 227, 230 n.2 (10th Cir. 1995) (per curiam) ("No
matter how styled, we construe a post-judgment motion served within ten days of the entry of judgment
and challenging the correctness of the judgment as a motion under Rule 59(e).") (citing Campbell v.
Bartlett, 975 F.2d 1569, 1580 n. 15 (10th Cir. 1992)). Motions for reconsideration may be granted
to "'correct manifest errors of law or fact or to present newly discovered evidence.'" In re Hodes, 239
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1Plaintiff also asserts that the Court overlooked the fact, which Plaintiff argued, that the
conversion to Chapter 7 to Chapter 11 occurred on October 16, 2003 and that Defendant did not wait
for the expiration of the Chapter 7 Trustee's assumption-rejection period before sending the demand
letter. On Page 12 of the Memorandum, the Court acknowledges that "the date Defendant sent the
default demand letter occurred prior to the date the Lease would have been deemed rejected . . . "
2
B.R. 239, 242 (Bankr.D.Kan. 1999), aff’d in part, rev’d in part on other grounds, 289 B.R. 5
(D.Kan. 2003) (quoting In re American Freight System, Inc., 168 B.R. 245, 246 (D.Kan. 1994)).
Plaintiff’s argument in support of his Motion for Reconsideration can be distilled to the
following1: 1) that the Court based its decision on legal theories that were neither pled nor argued by
the parties, and upon factual conclusions that were not supported in the paperwork before the Court; 2)
that the Defendant conceded the existence of the leasehold interest and its validity in its pleadings; and
3) that a successor lease executed in December 2001 had not expired as of the time Defendant sent
his default letter. None of these arguments are appropriate grounds upon which to grant a motion for
reconsideration.
“Appropriate circumstances for a motion to reconsider are where the court has obviously
misapprehended a party's position on the facts or the law, or the court has mistakenly decided issues
outside of those the parties presented for determination.” In re Sunflower Racing, Inc., 223 B.R. 222,
223 (D.Kan. 1998) (citations omitted). The Court’s decision determined the issue before the Court on
cross motions for summary judgment: namely, whether Defendant’s actions violated the automatic stay.
Plaintiff’s argument that Defendant violated the stay was based on his assertion that Debtor held a
possessory interest in the subject property based on a lease between Manny Ohiri and General Waste
Corporation (“GWC”). See Plaintiff Philip J. Montoya’s Memorandum in Opposition to Defendant’s
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3
Motion for Summary Judgment and in Support of Plaintiff’s Cross Motion for Summary Judgment
(“Plaintiff’s Memorandum”), p. 5; Affidavit of Manny Ohiri in Support of Motion for Summary
Judgment, attached to Plaintiff’s Memorandum as Exhibit A, ¶¶ 3. and 4. That the extension of the
argument raised by Defendant that his actions did not violate the automatic stay implicated matters of
law not specifically raised by Defendant does not transform the Court’s decision into one made outside
the issues presented for determination. See Olsen v. Russell (In re Kleckner), 81 B.R. 464, 466
(Bankr. N.D.Ill. 1988) (“Were the Court solely restricted to the arguments of counsel and the research
provided, there would be many uninformed and just plain incorrect decisions rendered. Rather, the
Court must be free to research the law and apply logical extensions of arguments made by counsel.”).
Defendant did not concede the existence or validity of the alleged leasehold between Manny
Ohiri and GWC in its motion for summary judgment, but recited in its statement of undisputed facts that
"The estate listed its interest in the subject property as a lease, but did not indicate the identity of the
lessor or of the owner of the property." Defendant Isidro Salcido's Memorandum Brief in Support of
Motion for Summary Judgment (“Defendant’s Memorandum”), ¶ 4. At page 5 of Defendant’s
Memorandum, Defendant argues that “No evidence presented by either party herein . . . provide any
evidence in support of plaintiff’s assertion that the debtor in the Chapter 7 proceeding at any time
owned either a leasehold interest, a legal interest, or an equitable interest in the Edith property.” These
statements belie Plaintiff’s contention in the Motion for Reconsideration that Defendant conceded the
existence or validity of any leasehold interest of GWC in the premises for purposes of summary
judgment.
The successor lease, attached as an exhibit to the Motion for Reconsideration, could have been
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4
attached to the Plaintiff's Memorandum, but was not. Motions for reconsideration should not be used
to present evidence that should have been presented in the first instance. Sunflower Racing, 223 B.R.
at 223 (“A party cannot invoke Rule 59(e) to . . . present evidence that should have been raised in the
first instance . . .”) (citation omitted). The successor lease is, therefore, not the type of newly
discovered evidence that serves as appropriate grounds for reconsideration.
“[E]vidence is not ‘newly discovered’ for purposes of Rule 59 if it ‘could have been
discovered with reasonable diligence’ at the time of trial.” In re Arden Properties, Inc., 248 B.R. 164,
170 (Bankr.D.Ariz. 2000) (quoting Coastal Transfer Co. v. Toyota Motor Sales, U.S.A., 833 F.2d
208, 211 (9th Cir.1987)). See also, Committee for First Amendment v. Campbell, 962 F.2d 1517,
1523 (10th Cir. 1992) (“‘When supplementing a Rule 59(e)motion with additional evidence, the movant
must show either that the evidence is newly discovered [and] if the evidence was available at the time of
the decision being challenged, that counsel made a diligent yet unsuccessful effort to discover the
evidence.’”) (quoting Chery v. Bowman, 901 F.2d 1053-1057-58 n.6 (11th Cir. 1990) (remaining
citation omitted)). Plaintiff’s Motion for Reconsideration appears to take inconsistent positions
regarding control and access to the premises where the successor lease Plaintiff now seeks to introduce
into evidence was located. Plaintiff's Motion for Reconsideration states at paragraph 6. that the
successor lease was unavailable to the Plaintiff because it was among the records stored on the
premises controlled by the Defendant, but states in paragraph 9. that Plaintiff assumed possession and
control of the premises after the conversion to Chapter 7. Thus, the Court is not persuaded that
Plaintiff has demonstrated that the newly discovered evidence Plaintiff seeks to introduce could not
have been discovered after a diligent search.
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WHEREFORE, IT IS HEREBY ORDERED, that the Motion for Reconsideration is DENIED.
_________________________________________
MARK B. McFEELEY
United States Bankruptcy Judge
I certify that on the date shown on the attached
document verification, a true and correct copy of
the foregoing was either electronically transmitted,
faxed, delivered or mailed to the listed counsel
and/or parties.
Steve H. Mazer
Attorney for Plaintiff
122 10th Street NW
Albuquerque, NM 87102
Melissa Morris
Attorney for Defendant
PO Box 809
Albuquerque, NM 87103
________________________________
Patti G. Hennessy
Law Clerk
(505) 348-2545
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