Davidson v. Bungay et al

UNITED STATES BANKRUPTCY COURT
FOR THE DISTRICT OF NEW MEXICO
In re:
RONALD ALAN DAVIDSON,
Debtor. 	No. 13-04-18262 SA
RONALD ALAN DAVIDSON,
Plaintiff,
v. 	Adv. No. 06-1079 S
JOHN BUNGAY, et al.,
Defendants.
MEMORANDUM OPINION ON TRANSPORTATION
INSURANCE COMPANY’S MOTION FOR SUMMARY
JUDGMENT ON ALL ISSUES
This matter is before the Court on Defendant Transportation
Insurance Company’s (“TIC”) Motion for Summary Judgment on All
Issues (doc 33), filed December 22, 2006. 	To date Plaintiff has
not responded to the Motion. 	This is a core proceeding. 	28
U.S.C. § 157(b)(2).
Summary judgment practice is governed by Fed.R.Bankr.P. 7056
and N.M. L.B.R. 7056-1. 	N.M. L.B.R. 7056-1 provides, in part:
A party opposing the motion shall, within 20 days after
service of the motion, file a written memorandum
containing a short, concise statement in opposition to
the motion with authorities. 	If no such responsive
pleading is filed, the court may grant the motion for
summary judgment.
...
A memorandum in opposition to the motion shall contain
a concise statement of the material facts as to which
the party contends a genuine issue does exist. 	Each
fact in dispute shall be numbered, shall refer with
particularity to those portions of the record upon
which the opposing party relies, and shall state the
number of the movant’s fact that is disputed. 	All
material facts set forth in the statement of the movant
shall be deemed admitted unless specifically
controverted.
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Because no response was filed all material facts set out in
TIC’s Motion are deemed admitted and the Court “may” grant
summary judgment. 	Federal Rule 7056(c) provides, however, that
summary judgment should be granted in the absence of a genuine
issue of material fact when “the moving party is entitled to a
judgment as a matter of law.” 	Therefore, the Court must examine
the undisputed facts and determine whether TIC is entitled to
judgment as a matter of law.
UNDISPUTED FACTS
1. 	Davidson,“Plaintiff”, is debtor in Bankruptcy Case 13-04-
18262 SA pending in the United States Bankruptcy Court for
the District of New Mexico.
2. 	Davidson’s company, T & T Management, was a sub-tenant of an
upper portion of a warehouse owned by Bungays located at 717
Coal Ave., S.E., Albuquerque, New Mexico (the “Warehouse”).
When Davidson filed his Chapter 13 petition, items remained
in the upper portion of the Warehouse. 	The items stored in
the upper portion of the Warehouse when the bankruptcy
petition was filed are referred to as “Inventory.”
3. 	The Bungays are insureds under a general liability insurance
policy number B2057876177 issued by TIC covering, in part,
the Warehouse property.
4. 	Davidson has asserted claims against the Bungays in
connection with Davidson’s use of space at the Warehouse.
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In turn, the Bungays made a claim on the Insurance Policy.
Pursuant to the Insurance Policy, TIC approved the Bungay’s
retention of Yenson, Lynn, Allen & Wosick, P.C. (“YLAW”) to
provide a defense for the Bungays. At TIC’s expense, in the
case captioned S5Sales, Inc. et. al. v. St. Paul/Travelers
Insurance, et. al., pending in the United States District
Court for the District of New Mexico, as Case No. CIV-05-
0005 WJ/ACT (the “U.S. District Court Action”). 	Pursuant to
the Insurance Policy, TIC is paying for the Bungays’ defense
in the U.S. District Court Action.
5. 	The Bungays are also parties to this adversary proceeding in
which they are represented by other counsel.
6. 	Although TIC pays Bungays for legal fees and expenses
incurred in connection with YLAW representing Bungays in the
U.S. District Court Action, neither YLAW nor attorney
Matthew A. Pullen is now nor ever has been an attorney or
agent for TIC in connection with the U.S. District Court
Action, the Warehouse, the Inventory, or any other matter
involving Davidson.
7. 	At some point after Davidson’s bankruptcy petition was
filed, the Inventory was moved from the upper portion of the
Warehouse.
8. 	TIC had no involvement in any aspect of moving the
Inventory, other than to approve the Bungays’ incurring of
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the expense to move the Inventory, and to pay for the cost
of the move and continued storage of the Inventory. 	TIC did
not arrange for or supervise the Inventory move. 	No one
from TIC was present at the time the Inventory was moved.
No one from TIC has accessed or has had access to the
Inventory before or after it was moved.
9. 	TIC never had possession of and never exercised any dominion
or control of any portion of the Warehouse or the Inventory,
and never participated in the management of the Warehouse.
10. 	TIC did not conduct a sale or participate in a sale of the
Inventory or any part of the Inventory at any time. 	TIC has
no knowledge of any sale of any portion of the Inventory
apart from Davidson’s allegations made in connection with
this adversary proceeding. 	If any such sale occured, TIC
was not aware of it.
11. 	TIC did not assume responsibility for the safekeeping of the
Inventory at the Warehouse or any part of the Inventory at
the Warehouse at any time.
12. 	TIC did not at anytime cut or destroy any locks at the
Warehouse or participate in any way in cutting or destroying
locks belonging to Davidson.
13. 	TIC did not make any representations to Davidson or to
anyone on his behalf with respect to the Inventory or moving
the Inventory.
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CONCLUSIONS OF LAW
1. 	Counts I through IV of the Complaint filed in this case do
not state claims against TIC and TIC is entitled to summary
judgment as a matter of law on Counts I through IV.
2. 	Count V of the Complaint is against all Defendants, and is
based on “Conversion/Theft & Fraud.”
A. 	“Under New Mexico law, tortious conversion of property
has been defined to include, inter alia, the wrongful
possession of, or the exercise of dominion over, a
chattel to the exclusion or in defiance of the owner’s
rights.” 	Allstate Ins. Co. v. Jensen, 109 N.M. 584,
589 n.4, 788 P.2d 340, 345 n.4 (1990)(Citations
omitted.) 	Undisputed facts 8-11 establish that TIC did
not convert any property.
B. 	Theft is defined as “The felonious taking and removing
of another’s personal property with the intent of
depriving the true owner of it; larceny.” 	Black’s Law
Dictionary 1486 (7 th ed. 1999). 	See also NMRA Crim.
UJI 14-1601 (elements of larceny). 	Undisputed facts 8-
11 establish that TIC did not steal any property or
commit theft.
C. 	“The elements of fraud include (1) a misrepresentation
of fact, (2) either knowledge of the falsity of the
representation or recklessness on the part of the party
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making the representation, (3) intent to deceive and to
induce reliance on the misrepresentation, and (4)
detrimental reliance on the misrepresentation.”
Williams v. Stewart, 137 N.M. 420, 429, 112 P.3d 281,
290 (Ct. App. 2005). 	TIC made no representations. 	See
Undisputed fact 13. 	Therefore, TIC is not guilty of
fraud.
3. 	Count VI complains of a violation of the automatic stay of
Bankruptcy Code Section 362. 	Undisputed facts 6-12
establish that TIC did not take any actions with respect to
or exercise control over any estate property. 	Count VI
should be dismissed as to TIC.
4. 	Count VII is against the Bungays and TIC and claims that the
defendants are liable to Debtor and the estate for damages
they have inflicted as a result of negligence. 	Davidson
does not allege what act or omission TIC committed or failed
to perform. 	See NMRA Civ UJI 13-1601 (defining negligence.)
The undisputed facts also fail to identify any duty running
from TIC to Davidson. 	The negligence count should be
dismissed as to TIC.
5. 	Count VIII seeks injunctive relief. 	“The Court has
repeatedly held that the basis for injunctive relief in the
federal courts has always been irreparable injury and the
inadequacy of legal remedies.” 	Weinberger v. Romero-
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Barcelo, 456 U.S. 305, 312 (1982). 	Each other count of this
complaint seeks money damages. 	Legal remedies are
available. 	The Court should not issue an injunction. 	TIC
should be granted summary judgment on this count.
6. 	The Court will enter a separate Order granting TIC’s Motion
for Summary Judgment and dismiss this case as to TIC.
Honorable James S. Starzynski
United States Bankruptcy Judge
copies to:
George M Moore
Moore, Berkson & Gandarilla
PO Box 216
Albuquerque, NM 87103-0216
Robert H Jacobvitz
500 Marquette NW Ste 650
Albuquerque, NM 87102-5309
Brandon Hertzler
PO Box 3006
Albuquerque, NM 87190-3006
Michael Patrick Clemens
Butt, Thorton & Baehr, P.C.
PO Box 3170
Albuquerque, NM 87190-3170
Steven K Eisenberg
261 Old York Rd Ste 410
Jenkintown, PA 19046-3722
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