A lender filed a supplemental motion for summary judgment against my clients, two borrowers under a defaulted note.

Preparing opposition to the motion, I found in my research the case of Certusbank, N.A. v. MLJJ Props., LLC, No. 3:12–cv–46, 2013 WL 4009658, at *3 (M.D.Ga. Aug. 5, 2013).  It recites facts similar to those in my case; I hesitate to refer to it as “on all fours” without reading the record.  The precedential value of the case does not concern me.  The court’s attitude does:

Sometimes litigation is used to delay the inevitable. Using litigation for such purposes is regrettable but not prohibited as long as the positions asserted are not frivolous. Defendants’ avoidance of its legal obligations with no legitimate defense in this action approaches the line of sanctionable conduct, but the Court declines to find their non-meritorious positions to be frivolous. The Court does not hesitate to conclude, however, that Plaintiff is entitled to summary judgment on its claims.

Certusbank at *1.  The debtors argued in opposition to Certusbank’s summary judgment motion that the lender had failed to show both entitlement to enforce the note and the amount due: basically the arguments that I made.  Had I actually come that close to sanctionable conduct by making those arguments?  If my clients signed a note and then defaulted, should that be it?  Just stick a fork in them and forget it?   What ever happened to requiring a plaintiff to prove its case?  A borrower’s putting a lender to its proof may indeed delay resolution. (As if the system is designed for efficiency in the first instance.)    Delay is not as important as the right of a defendant  to require proof of the plaintiff’s claims.  Exercising that right is neither frivolous nor regrettable.  It is essential.

To show the amount due, Certusbank relied on the promissory note, the loan history and the loan payoff statement.  Id. At *3. If the “loan history” sufficiently showed each payment, the allocation to principal and interest, and the calculation of accrued interest and late fees, without resort to documentation outside the record, then the bank’s evidence may have been sufficient. In my experience, however, that is unlikely.

The case against my clients, in the Northern District of Georgia, is a case in point.  The bank filed its initial motion for summary judgment several months ago.  The court granted the motion on liability but denied it on calculation of damages, instructing the bank to submit supplemental backup.  The court relied on the opinion of the Georgia Court of Appeals in Myers v. First Citizens Bank & Trust Co., 324 Ga. App. 293 (2013).  I also represented the borrowers in that case with a similar result.  The Georgia Court of Appeals also relied on Myers for its decision in Gregg v. First Citizens Bank & Trust Co., 328 Ga.App. 87, 761 S.E.2d 514 (Ga. App., 2014), in which I also represented the borrowers.

A lender can easily prove a borrower’s liability under a note:  the borrower signed the note, got the money and did not repay it.  Proving how much the borrower owes is the more difficult task.