Caplan v. Yonks & Associates et al

1
UNITED STATES BANKRUPTCY COURT
DISTRICT OF NEW MEXICO
In re: 	SANDRA J. DAY, 	No. 7-06-12329 MA
Debtor.
_____________________________________________________________________________
MICHAEL J. CAPLAN,
Plaintiff,
v. 	Adversary No. 07-1156 M
YONKS & ASSOCIATES;
REGATTA CAPITAL LTD.;
JAN T. NELSON and ELAINE S. NELSON;
WESTSTAR MORTGAGE CORPORATION;
SECURITY STATE BANK AND TRUST;
LAFARGE SOUTHWEST, INC.;
DEPARTMENT OF THE TREASURY -
INTERNAL REVENUE SERVICE; DAYTON
RITE AID, LLC, a California Limited Liability
Company; CHARLES R. TRIMBLE and LYNDA
K. TRIMBLE; DAVID ALTOUNIAN; LC5
INVESTMENTS, LLC, a New Mexico Limited
Liability Company; and CLAYTON C. ANDREWS;
Defendants.
ORDER DENYING DAYTON RITE AID LLC'S
MOTION FOR RECONSIDERATION OF ORDER GRANTING
REGATTA CAPITAL, LTD.'S MOTION FOR SUMMARY JUDGMENT
THIS MATTER is before the Court on the Motion for Reconsideration of Regatta's [sic.]
Capital Ltd.'s Motion for Summary Judgment Entered on 12-10-08 ("Motion") filed by Dayton
Rite Aid, LLC ("Dayton"), by and through its attorneys Behles Law Firm, P.C. (Jennie D.
Behles) filed on December 22, 2008. 	See Docket No. 82. 	The Motion requests the Court to
reconsider pursuant to Rule 59, Fed.R.Civ.P. the Order Granting Regatta Capital, Ltd.'s Motion
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1The Order was entered on December 10, 2008. The tenth day following the date of entry
of the Order was December 21, 2008, a Sunday. See Rule 9006, Fed.R.Bankr.P. ("the day of the
. . . event from which the designated period of time begins to run shall not be included.")
Therefore, the Motion, filed on the following business day, Monday, December 22, 2008, was
timely filed within the ten-day period. See Rule 9006, Fed.R.Bankr.P. ("The last day of the
period so computed shall be included, unless it is . . . a Sunday . . . in which event the period
runs until the end of the next day which is not one of the aforementioned days.").
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for Summary Judgment ("Order") entered December 10, 2008 which determined that Regatta
Capital, Ltd. ("Regatta") holds a first position claim against the proceeds from the Chapter 7
Trustee's sale of certain real property of the Debtor's bankruptcy estate based on a recorded
transcript of judgment against the Debtor, and her former spouse Mark Day, now deceased. See
Docket 79. 	Regatta filed a response to the Motion, and Dayton filed a reply. 	After
consideration of the Motion, the response, and the reply, the Court finds that there is insufficient
cause to alter its conclusions of law contained in the Order. 	Accordingly, the Court will deny
the Motion.
DISCUSSION
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 (10 th Cir. 1995) ("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)."). Dayton's Motion
was filed within ten days of the date of entry of the Order and will, therefore, be construed under
Rule 59, Fed.R.Civ.P.1 Motions to alter or amend a judgment or order filed pursuant to Rule 59,
Fed.R.Civ.P. may be granted to "'correct manifest errors of law or fact or to present newly
discovered evidence under limited circumstances.'" In re Hodes, 239 B.R. 239, 242
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(Bankr.D.Kan. 1999), aff’d in part, and 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)).
“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). Rule 59(e) does not afford parties seeking relief
an opportunity to raise new arguments, or to “rehash arguments previously considered and
rejected by the court.” Id.
Dayton continues to assert that Regatta failed to properly support its motion for summary
judgment as required by Rule 56, Fed.R.Civ.P., and that the property sold by the Chapter 7
trustee included non-estate property due to the divorce of the Debtor and Mark Day. 	Dayton
raised these arguments in response to Regatta's motion for summary judgment. 	In granting
Regatta's motion for summary judgment, the Court necessarily addressed and rejected these
arguments. 	See Van Skiver v. United States, 952 F.2d 1241, 1243 (10 th Cir. 1991)(“[R]evisiting
the issues already addressed ‘is not the purpose of a motion to reconsider[.]’”)(quoting Van
Skiver v. United States, 751 F.Supp. 1522, 1523 (D.Kan. 1990)).
Next, Dayton points out that Regatta's transcript of judgment was released, and then re-
recorded on July 1, 2004 without the re-issuance of a transcript of judgment. 	Because Regatta's
transcript of judgment was released and subsequently re-recorded without the new issuance of a
transcript of judgment, Dayton argues that Regatta has failed to demonstrate its priority.
Attached to the Motion is a copy of the Release of Transcript of Judgment in Bernalillo County
Only ("Release"). 	Dayton did not attach a copy of the Release to its response to Regatta's
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motion for summary judgment. 	Nor did Dayton specifically raise the argument that the re-
recording of Regatta's transcript of judgment without re-issuance from the district court
somehow invalidates Regatta's lien. 	A motion for reconsideration does not serve as a vehicle to
raise or re-frame arguments that could have been raised at the outset. See Van Skiver, 952 F.2d
at 1243 (“‘[A]dvanc[ing] new arguments or supporting facts which were otherwise available for
presentation when the original summary judgment motion was briefed’ is likewise
inappropriate.”)(quoting Van Skiver, 751 F.Supp at 1523); Sunflower Racing, 223 B.R. at 223
(“A party's failure to present its strongest case in the first instance does not entitle it to a second
chance in the form of a motion to reconsider.”)(citation omitted).
Nevertheless, because it is apparent on the face of Regatta's Transcript of Judgment that
the document was re-recorded, the Court will address Dayton's argument. 	Dayton relies on
Breece v. Gregg, 36 N.M. 246, 13 P.2d 421 (1932), which held that, by statute, the docketing of
a judgment by the court clerk is a necessary step in creating a lien on the judgment debtor’s real
property, which is completed by the filing of a transcript of judgment in the office of the county
clerk. Breece, 36 N.M. at 248. 	In Breece, because the judgment had not been docketed, the
requirements of the statute had not been substantially complied with, and the recording of a
transcript of judgment was ineffective to create a lien. Id. 	Curtis Manufacturing Company v.
Barela, 76 N.M. 392, 415 P.2d 361 (1966), another case cited by Dayton, simply acknowledges
that a judgment and a judgment lien against real property are separate rights.
Here, unlike Breece, Regatta’s judgment was docketed in the state court action, and
Regatta obtained a transcript of judgment from the state court which it recorded in Bernalillo
County. 	Regatta then recorded a Release. 	The Release contained the following language:
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2That section provides:
Any money judgment rendered in the supreme court, court of appeals, district
court or metropolitan court shall be docketed by the clerk of the court and a
transcript or abstract of judgment may be issued by the clerk upon request of the
parties. The judgment shall be a lien on the real estate of the judgment debtor
from the date of the filing of the transcript of the judgment in the office of the
country clerk of the county in which the real estate is situate. Upon approval and
filing of a supersedeas bond upon appeal of the cause as provided by law, the lien
shall be void. Judgment shall be enforced for not more than fourteen years
thereof.
N.M.S.A. 1978 § 39-1-6 (Repl. Pamp. 2006).
3That section provides:
A. The transcript of judgment issued by the clerks of the supreme court, court of
appeals, district courts and metropolitan courts shall show:
(1) the names of the parties;
(2) the number and nature of the case;
(3) the court in which judgment was rendered
(4) the date of the judgment, amount of damages, amount of costs, total
amount of judgment and date of docket;
(5) the attorney for the creditor;
(6) issuance and return of executions, if any; and
(7) satisfaction of judgment when paid.
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"This Release of Transcript of Judgment shall not be a release of the Judgment itself." 	It is
therefore clear from the Release that Regatta did not release its judgment; the scope of the
Release is limited to the Transcript of Judgment, and is further limited to Bernalillo County.
Regatta later re-recorded its transcript of judgment based upon its judgment which was never
released. Dayton asserts that by failing to obtain a new transcript of judgment from the state
court, and instead, re-recording the existing transcript of judgment, Regatta failed to comply with
the statute so that its re-recorded transcript of judgment failed to create a valid lien. This Court
disagrees.
There is no requirement in N.M.S.A. 1978 § 39-1-6 (Repl. Pamp. 2006) 2 or N.M.S.A.
1978 § 39-1-8 (Repl. Pamp. 2006) 3 for a creditor to obtain a new transcript of judgment from the
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N.M.S.A. 1978 § 39-1-8 (Repl. Pamp. 2006).
4That section provides:
When any judgment giving rise to a subsisting lien pursuant to Section 39-1-6
NMSA 1978 upon any real estate in the state has been fully satisfied, it is the duty
of the judgment creditor to file a release of the lien in the office of the county
clerk of the county in which the real estate is situate. The cost of filing the release
of lien shall be assessed against the judgment debtor and shall be collected before
the release of lien is required to be filed.
N.M.S.A. 1978 § 39-1-6.1 (Repl. Pamp. 2006).
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court in which the judgment was entered in order to re-record a transcript of judgment
evidencing a judgment which was never released. 	A creditor's obligation to release a transcript
of judgment arises only when the judgment has been satisfied in full. See N.M.S.A. 1978 § 39-1-
6.1 (Repl.Pamp. 2006).4 Dayton asserts that Regatta received some payments on its judgment
and that, because it did not obtain a new transcript of judgment (which would presumably reflect
a lesser judgment amount) re-recording the original transcript of judgment is somehow invalid.
The purpose of recording a transcript of judgment is to give notice to parties bound to
search the real property records that a creditor holds a judgment and asserts a lien against any
real property held by the judgment debtor in the county in which the transcript of judgment is
recorded. See Kuntzman v. Guaranteed Equities, Inc., 105 N.M. 49, 51, 728 P.2d 459, 461
(1986)(“New Mexico’s recording statute is a notice statute. . .”); Angle v. Slayton, 102 N.M. 521,
523, 697 P. 2d 940, 942 (1985)(New Mexico’s recording statute, N.M.S.A. 14-9-1, serves as
notice to “those persons bound to search the record.”). Re-recording the original transcript of
judgment achieved that purpose: it re-established record notice of Regatta's judgment and
created a recorded lien against all real property located in Bernalillo County owned by Sandra
Day and Mark Day with a priority date as of the date the transcript of judgment was re-recorded.
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5Regatta’s Transcript of Judgment was re-recorded in Bernalillo County, New Mexico on
July 1, 2004. 	Dayton’s Transcript of Judgment was recorded in Bernalillo County, New Mexico
on January 31, 2006.
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See N.M.S.A. 1978 § 39-1-6 (Repl.Pamp. 2006)(“The judgment lien shall be a lien on the real
estate of the judgment debtor from the date of the filing of the transcript of judgment in the
office of the county clerk of the county in which the real estate is situate.”). 	As stated by
Dayton in its Motion, the real issue before the Court in this adversary proceeding is not the
amount of Regatta’s judgment, but the priority of its lien. The re-recorded date of Regatta's
transcript of judgment pre-dates the date Dayton's transcript of judgment was recorded.5
Regatta therefore has priority over Dayton, which this Court already determined in its Order.
WHEREFORE, IT IS HEREBY ORDERED that the Motion is DENIED.
________________________________________
MARK B. McFEELEY
United States Bankruptcy Judge
Date entered on docket: February 5, 2009
COPY TO:
Jennie Deden Behles
Attorney for Dayton Rite Aid, LLC
PO Box 7070
Albuquerque, NM 87194
Daniel J. Behles
Attorney for Regatta Capital, Ltd.
7770 Jefferson NE, Suite 305
Albuquerque, NM 87109
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