County Superior Court
Plaintiff: Richard L. Gemma, Esq.
Defendant: Timothy J. Morgan, Esq.; W. Kenneth O'Donnell,
this Court is Plaintiff Bank of America, N.A.'s
(Plaintiff or BOA) motion for summary judgment and entry of
final judgment against Defendants Timothy G. Fay (Fay) and
David N. Patrick (Patrick) (collectively, Defendants). On
June 29, 2018, this Court found Defendants liable to BOA as
Guarantors of a note executed by Stonestreet Hospitality
Realty Company, LLC (Stonestreet or Borrower) and delivered
to BOA, but declined to assign a value to the debt. BOA now
seeks to find Defendants jointly and severally liable in the
amount of $5, 022, 003.67 as of April 30, 2018, plus
interest, as adjudicated by the Connecticut Superior Court on
May 15, 2018 (the Connecticut Proceeding). Bank of
America, N.A. v. Stonestreet Hospitality Realty Company, LLC
et al., Docket No. KNLCV166026981S. The Defendants have
objected to the motion. The sole issue before this Court is
the amount due under this guaranty. Jurisdiction is pursuant
to G.L. 1956 § 8-2-13.
Facts and Travel
Patrick are residents of Rhode Island, as well as principals
and collective one hundred percent owners of Stonestreet, a
Limited Liability Company organized under the laws of
Connecticut. Fay is the majority owner and manager of
Stonestreet with a seventy percent interest; Patrick owns the
remaining thirty percent. BOA is a national banking
association organized under federal law with a place of
business in Providence, Rhode Island.
15, 2008, Stonestreet executed and delivered a promissory
note (Note) in the amount of $21, 808, 000, secured by a
first mortgage on a 176 room Hyatt Place Mohegan Sun Hotel,
in Montville, Connecticut (the Property). (Pl.'s Compl.
Ex. A, Promissory Note.) Borrower contemporaneously executed
and delivered a Senior Construction and Interim Loan
Agreement (the Loan Agreement) to BOA in connection with the
Note. Also on May 15, 2008, Defendants executed
and delivered a personal guaranty (Guaranty) to BOA in
connection with the Loan Agreement. The Guaranty was executed
in Rhode Island and included a choice-of-law provision
indicating that the agreement was to be governed, in all
respects, by Rhode Island law.
November 21, 2014, payment of the Note came due in full under
the terms of the Loan Agreement but payment was not made.
(Pl.'s Compl. ¶ 9.) Accordingly, BOA made a demand
for immediate payment from Stonestreet and Guarantors.
Id. On September 2, 2015, BOA, Stonestreet, and
Guarantors entered into a loan forbearance agreement (the
Forbearance Agreement), which designated December 15, 2015 as
the new maturity date for the Note and provided that the
Guaranty remain enforceable and in effect. (Pl.'s Compl.
Ex. D, Forbearance Agreement.) Borrower and Guarantors failed
to repay the Note by the new maturity date. Id.
31, 2016, BOA filed a complaint in Connecticut Superior Court
(Connecticut Court) to foreclose its mortgage on the
Property. On September 25, 2017, the Connecticut Court
granted partial summary judgment in favor of BOA, finding
that Stonestreet owed $23, 108, 768.17 to BOA as of September
25, 2017. See Bank of America, N.A. v.
Stonestreet Hospitality Realty Company, LLC, CV
166026981S, 2018 WL 2208002 (Conn. Super. Ct. Apr. 20, 2018).
Ownership of the Property transferred from Stonestreet to BOA
on November 8, 2017 (the Transfer Date), memorialized by a
Certificate of Foreclosure recorded by BOA. After conducting
a two-day hearing on February 15 and 27, 2018, the
Connecticut Court concluded the value of the Property on the
Transfer Date was $18, 400, 000. Id. On May 15,
2018, the Connecticut Court found the deficiency due to BOA
on the Note to be $5, 022, 003.67 as of April 30,
April 12, 2016, BOA filed the within Complaint against Fay
and Patrick in their capacity as Guarantors of the Note. On
June 29, 2018, this Court granted partial summary judgment in
favor of BOA, holding that Rhode Island law governed the
Guaranty agreement and finding Defendants liable for the
indebtedness under the Guaranty. However, this Court declined
to assign a value to the debt. BOA now moves for summary
judgment and entry of final judgment in their favor, asking
that this Court hold Guarantors liable for the final amount
of indebtedness as adjudicated by the Connecticut Court. BOA
seeks the deficiency from Guarantors as adjudicated by the
Connecticut Court, or $5, 022, 003.67 as of April 30, 2018,
plus interest at BOA's prime rate plus 4% per annum, or
$1, 255.50 per day. As of August 1, 2018, the indebtedness
amounted to $5, 137, 230.76, using this calculation.
Standard of Review
well-settled that "[s]ummary judgment is 'a drastic
remedy,' and a motion for summary judgment should be
dealt with cautiously." Estate of Giuliano v.
Giuliano, 949 A.2d 386, 390-91 (R.I. 2008) (quoting
Ardente v. Horan, 117 R.I. 254, 256-57, 366 A.2d
162, 164 (1976)). "[S]ummary judgment is appropriate
when, viewing the facts and all reasonable inferences
therefrom in the light most favorable to the nonmoving party,
the [C]ourt determines that there are no issues of material
fact in dispute, and the moving party is entitled to judgment
as a matter of law." Quest Diagnostics, LLC v.
Pinnacle Consortium of Higher Educ., 93 A.3d 949, 951
(R.I. 2014) (internal quotation marks omitted) (alterations
moving party bears the initial burden of establishing the
absence of a genuine issue of fact."' McGovern
v. Bank of Am., N.A., 91 A.3d 853, 858 (R.I. 2014)
(quoting Robert B. Kent et al., Rhode Island Civil
Procedure § 56:5, VII-28 (West 2006)). Once this
burden is met, the burden shifts to the nonmoving party to
prove by competent evidence the existence of a genuine issue
of fact. Id. The nonmoving party may not rely on
'"mere allegations or denials in the pleadings, mere
conclusions or mere legal opinions'" to satisfy its
burden. D'Allesandro v. Tarro, 842 A.2d 1063,
1065 (R.I. 2004) (quoting Santucci v. Citizens Bank of
R.I., 799 A.2d 254, 257 (R.I. 2002) (per curiam)).
asks this Court to find Guarantors liable for the amount
adjudicated by the Connecticut Proceeding. In furtherance of
this position, Plaintiff submits six legal theories including
(1) doctrine of merger, (2) res judicata, (3) collateral
estoppel, (4) the Restatement of Law on Judgments,
(5) judicial estoppel, and (6) the doctrine of judicial
admission. Defendants object to Plaintiff's motion.