TORRUELLA, Circuit Judge.
Defendant-Appellant Michael Díaz-Santiago ("Díaz-Santiago")
I. Background
On October 8, 2008, MDS Caribbean Seas Limited ("MDS"), a company that Díaz-Santiago incorporated under the laws of the British Virgin Islands, purchased a vessel, the "Black Sea." That same day, MDS executed a promissory note in favor of FirstBank, which it secured by a preferred ship mortgage (the "Preferred Ship Mortgage" or "Mortgage"), as a form of payment guarantee to FirstBank. Also on October 8, Díaz-Santiago and his wife expressly guaranteed MDS's compliance with the terms of the promissory note and Preferred Ship Mortgage by executing and sending to FirstBank a continuing letter of guaranty, jointly and severally binding themselves to the amount owed should the vessel owner, MDS, default.
Pursuant to the clear terms of the Preferred Ship Mortgage, MDS, as the owner of the vessel, was required to "keep the vessel fully and adequately insured ... in at least the amount of the unpaid principal balance of this Mortgage...." Stated differently, MDS was contractually obligated to insure the Black Sea to protect FirstBank's position as a loss payee. The Mortgage additionally provided in the section entitled, "Default," that MDS would be liable for any advances, expenditures, or costs that FirstBank incurred for, among other reasons, defending suits related to the Preferred Ship Mortgage and promissory note. The provision states as follows:
(Emphasis added.)
Accordingly, Díaz-Santiago obtained insurance for the vessel. On October 7, 2008, he prepared marine insurance application materials and submitted them to Blue Waters Insurers, Corp. ("Blue Waters"), an underwriting agent for various insurers, including Markel American Insurance Company ("Markel"). Markel, via Blue Waters, issued a marine insurance policy (the "Policy") to Díaz-Santiago in his name based on the information he had provided. Notably, one of Díaz-Santiago's submitted materials stated that he was the specific owner of the Black Sea, and not
In early March 2009, the Black Sea and its owners entered rough waters. The U.S. Customs and Border Protection ("CBP") seized the vessel as part of a drug enforcement action.
FirstBank, seeking to protect its interest in the vessel, took action to secure the Black Sea's release. Specifically, it initiated an administrative forfeiture proceeding before the CBP; it also intervened in the subsequent criminal case and obtained a voluntary dismissal of the indictment against the vessel.
First, it asserted that the Policy was void ab initio because Díaz-Santiago had made material misrepresentations during the marine insurance application process, i.e., he declared himself as the owner of the vessel, when in fact all paperwork concerning the Black Sea's purchase identified MDS as the insured vessel's owner. Second, Markel noted that the Policy's "Use of Your Yacht" provision specifically prohibited the insured yacht's usage for illegal purposes. That same day, Markel notified Díaz-Santiago that the Policy had been declared null and void and issued him a premiums refund check.
Sailing was hardly smooth for the parties thereafter. On July 15, 2009, Markel filed a Complaint for declaratory judgment against Díaz-Santiago and FirstBank, seeking a determination that the Policy was void due to Díaz-Santiago's misrepresentation or, alternatively, that the Policy did not provide coverage to either Díaz-Santiago or FirstBank for the alleged losses resulting from the vessel's seizure. On September 28, 2009, FirstBank filed its Answer and Counterclaim against Markel; filed a Crossclaim against Díaz-Santiago; and filed a Third Party Complaint against, among others, Blue Waters and Díaz-Santiago's wife. On October 9, 2009, FirstBank filed an Amended Third Party Complaint, bringing MDS on board the action.
A series of dispositive motions soon followed—including Markel's October 23, 2009 motion for summary judgment against Díaz-Santiago and FirstBank, and FirstBank's December 4, 2009 opposition motion and cross-motion for summary judgment—with FirstBank and Markel predominantly contesting the validity of the Policy. Following this flurry of filings, Markel and Díaz-Santiago filed a Joint Motion for Entry of Judgment by Consent (the "Consent Motion") on March 26, 2010,
In the Consent Motion, the parties stated "that the information regarding the identity of the owner of the vessel was a material fact that should have been disclosed to Markel." The parties further sought entry of judgment for Markel, "declaring that the [Policy] was null and void and does not provide coverage for the damages and/or losses related to the [March 2009] seizure of the [vessel] by [CBP]." On April 9, 2010 the district court granted the motion pursuant to its terms.
FirstBank acted swiftly. Also on April 9, it moved for partial summary judgment against Díaz-Santiago, his wife, and MDS (the "April 9 motion"). FirstBank claimed that Díaz-Santiago's admission that the governing insurance policy was null and void due to his misrepresentation or concealment of material facts to Markel—i.e., identifying himself as the owner of the vessel, and not MDS—constituted a breach by MDS of its Preferred Ship Mortgage with FirstBank, which specifically required MDS to "fully and adequately" insure the vessel and to cover all "advances and expenditures" that FirstBank incurred in defending suits related to the Mortgage and promissory note. Díaz-Santiago failed to file an opposition motion to FirstBank's April 9 motion, and so, on May 4, 2010, FirstBank moved for the district court to treat that motion as unopposed.
That same day, Díaz-Santiago moved to strike FirstBank's April 9 motion for partial summary judgment on the grounds that it did not comply with Local Rule 56 because it did not contain "a separate, short, and concise statement of material facts." D.P.R. Civ. R. 56. Specifically, Díaz-Santiago challenged FirstBank's decision to incorporate by reference the parties' statements of uncontested material facts that already were on the record from the various motions and cross-motions for summary judgment previously filed in the case, rather than file a separate statement of uncontested facts with the April 9 motion.
On September 30, the district court granted FirstBank's April 9 motion for partial summary judgment and awarded FirstBank $74,512.50 in attorneys' fees for costs and expenses incurred in securing release of the vessel and defending the validity of the Policy (referred to hereinafter as the "September 30 order"). Díaz-Santiago subsequently filed a Rule 59 motion to either alter or amend the court's order, set aside its judgment, or reconsider its opinion. The court denied Díaz-Santiago's motion on November 30, 2010 (the "November 30 order"). This appeal followed,
II. Discussion
A. Denial of Motion to Strike and/or Motion for Protective Order
FirstBank contends, first, that this Court does not have jurisdiction over Díaz-Santiago's challenge to the district court's denial of his motion to strike and/or motion for a protective order (the "strike/protective order motions"), and second, that even if we do, the district court committed no error. We proceed to the jurisdictional question.
FirstBank hangs its argumentative hat on the fact that Díaz-Santiago's Notice of Appeal does not specifically designate the district court's order denying his strike/protective order motions. Thus, so the argument goes, Díaz-Santiago failed to provide the requisite notice to either this Court or to FirstBank as to the issues it would be challenging on appeal. In essence, FirstBank alleges that Díaz-Santiago failed to comply with the requirements of Rule 3(c) of the Federal Rules of Appellate Procedure.
Rule 3(c) provides that a "notice of appeal must ... designate the judgment, order, or part thereof being appealed." Fed. R.App. P. 3(c)(1)(B); Lehman v. Revolution Portfolio LLC, 166 F.3d 389, 395 (1st Cir. 1999) (stating "a notice of appeal must specify the order or judgment to which the appeal is addressed"). The Supreme Court has made clear that the rule's requirements, while mandatory and jurisdictional, see Torres v. Oakland Scavenger Co., 487 U.S. 312, 315-17, 108 S.Ct. 2405, 101 L.Ed.2d 285 (1988), should be construed liberally, Smith v. Barry, 502 U.S. 244, 248, 112 S.Ct. 678, 116 L.Ed.2d 678 (1992). In performing such liberal construction, however, we are aware that "noncompliance" with the rule's mandates "is fatal to an appeal." Id. (additionally stating "[t]his principle of liberal construction does not, however, excuse noncompliance with the Rule," as its "dictates are jurisdictional in nature, and their satisfaction is a prerequisite to appellate review"); Constructora Andrade Gutiérrez, S.A. v. Am. Int'l Ins. Co. of P.R., 467 F.3d 38, 43 (1st Cir.2006) ("The failure to include a particular issue in a notice of appeal can be fatal to this court's jurisdiction over that issue.").
In assessing whether the Notice of Appeal confers appellate jurisdiction over Díaz-Santiago's claim, "we are cognizant that `the notice afforded by a document, not the litigant's motivation in filing it, determines the document's sufficiency as a notice of appeal.'" Kotler v. Am. Tobacco Co., 981 F.2d 7, 11 (1st Cir.1992) (quoting Smith, 502 U.S. at 248, 112 S.Ct. 678). Specifically, we review the notice to determine whether Díaz-Santiago's intent to appeal the district court's June 14 order denying his strike/protective order motions was sufficiently manifest so as to provide clear notice to FirstBank. See id. (citing Smith, 502 U.S. at 248, 112 S.Ct. 678); see also Torres, 487 U.S. at 318, 108 S.Ct. 2405 (noting that Rule 3(c)'s "specificity requirement" serves to ensure "fair notice" to both the court and opposition regarding an appeal). In conducting this review, we do not examine the notice in isolation, but consider the record in its entirety. See FirsTier Mortg. Co. v. Investors Mortg. Ins. Co., 498 U.S. 269, 276 n. 6, 111 S.Ct. 648, 112 L.Ed.2d 743 (1991); Kotler v. Am. Tobacco Co., 926 F.2d 1217, 1221 (1st Cir. 1990), vacated on other grounds 505 U.S. 1215, 112 S.Ct. 3019, 120 L.Ed.2d 891
The Notice of Appeal in this case specifically provides:
On the one hand, a review of the Notice reveals no express reference to the district court's June 14 order denying Díaz-Santiago's strike/protective order motions, a seemingly fatal flaw under Rule 3(c)'s clear provisions. See Fed. R.App. P. 3(c); Poy v. Boutselis, 352 F.3d 479, 486 (1st Cir. 2003) (holding that appellant's failure to include an issue in its notice of appeal "is fatal to our jurisdiction"). The only judgment designations contained in Díaz-Santiago's Notice of Appeal are to the district court's September 30 order (granting FirstBank's motion for partial summary judgment) and the court's November 30 order (denying Díaz-Santiago's motion under Rule 59 for alteration or amendment of judgment). The Notice of Appeal's omission of any specific reference to the district court's June 14 order "while, at the same time, designating ... completely separate and independent order[s] loudly proclaims [Díaz-Santiago's] intention not to appeal from the former [June 14] order." Kotler, 981 F.2d at 11.
On the other hand, we remain mindful that we must construe the Notice of Appeal liberally and look beyond the limited confines of the notice document itself to the record as a whole. A careful review of such record shows that in Díaz-Santiago's motion to alter or set aside the district court's September 30 order, he makes mention of the court's June 14 order denying his strike/protective order motions and specifically cites to the order's docket number. In citing that order, appellant states as follows:
(Emphasis added.)
Díaz-Santiago's Russian nesting doll-esque technique of raising his challenge to the district court's June 14 order within his challenge to the court's September 30 order was not the most express or direct means to highlight for this Court or FirstBank his intention to appeal such judgment. However, while we are somewhat skeptical that Díaz-Santiago's linguistic turn of hand here was sufficient to satisfy Rule 3(c)'s specific designation requirements, we are able to dodge this jurisdictional conundrum. Rather than draw our own conclusions concerning Díaz-Santiago's appellate intent from the record, we "take shelter instead under the familiar principle that where an appeal presents a difficult jurisdictional issue, yet the substantive merits underlying the issue are facilely resolved in favor of the party challenging jurisdiction, the jurisdictional issue may be avoided." Kotler, 926 F.2d at 1221.
The district court's June 14 order denied Díaz-Santiago's contention that FirstBank's motion for partial summary judgment
We are particularly deferential to a district court's application and interpretation of its own local rules. Crowley v. L.L. Bean, Inc., 361 F.3d 22, 25 (1st Cir.2004); see also P.R. Am. Ins. Co. v. Rivera-Vázquez, 603 F.3d 125, 131 (1st Cir.2010) ("[I]t is primarily the role of the district court to determine what departures from a local rule may be tolerated."). Here, the record shows that FirstBank's April 9 motion expressly incorporated by reference all parties' statements of uncontested facts that were previously submitted in support of their prior respective motions. One such motion and corresponding statement of uncontested facts included FirstBank's previous cross-motion for summary judgment (filed on December 4, 2009), which was in full compliance with Local Rule 56's requirements. Indeed, in incorporating all prior filed statements of uncontested facts in its April 9 motion, FirstBank made express reference to its December 4 cross-motion for summary judgment and corresponding statement of uncontested facts.
A review of the docket leaves no doubt that the parties here had ample opportunity to flex their motion-practice muscles (of which they took clear advantage), and that, in doing so, the parties consistently asserted substantive facts and arguments that did not noticeably vary from one motion to the next. While we will not speculate as to the district court's reasons for denying Díaz-Santiago's strike/protective order motions, which are unclear from the court's brief order, we see no abuse of discretion in its determination to, at the very least, conserve judicial resources and rely on the ample record before it—which FirstBank expressly cited to, specifically directed the court, and unequivocally incorporated by reference—containing similar legal allegations and factual averments throughout. Local Rule 56 nowhere mandates that a district court deny motions that incorporate matters by reference. Under the facts of this case, we see no error in the district court's decision to permit such incorporation here.
Díaz-Santiago also challenges FirstBank's subsequent filing of an addendum to its April 9 motion providing the specific attorneys' fees and costs it had incurred in securing the vessel's release and defending the Policy's validity. He contends that FirstBank's submission of attorney declarations detailing hours worked also constituted a violation of Local Rule 56(b) because "the attorneys' alleged work before administrative agencies or before other judges could not be automatically attributable to defendants in this case." We find no merit to Díaz-Santiago's cursorily raised argument.
To begin with, we are not convinced that Local Rule 56(b), addressing the filing of uncontested statements of fact, is the proper rule on which Díaz-Santiago should be relying. The addendum here was clearly not meant to be included as part of a statement of uncontested facts; rather, it was offered as further support for FirstBank's summary judgment argument that Díaz-Santiago was liable for all costs and attorneys' fees incurred in securing the vessel's release and defending the Policy's
The addendum consisted of several attorneys' affidavits identifying the specific proceedings on which they worked in the dispute—all of which consisted of representing FirstBank in the underlying criminal proceedings, its administrative proceeding before the CBP, and in the litigation concerning the Policy's validity. Under the clear terms of the Mortgage, Díaz-Santiago could be held liable for expenses associated with such proceedings, and moreover, for his conceded breach of the terms of the agreement. The question of such fees was thus part and parcel of FirstBank's argument in support of summary judgment.
FirstBank's April 9 motion specifically flagged for the court that the addendum setting forth such fees would be swiftly forthcoming; in fact, it was filed approximately five days after the summary judgment motion's filing. While it is unclear why FirstBank did not include the addendum with the summary judgment motion itself, the record shows it was filed soon after, and far in advance of the court's September 30 order granting summary judgment. Tellingly, Díaz-Santiago points us to no local rule or applicable case law establishing that such a supplemental filing of supporting materials, specifically referenced in the original motion, is improper.
We thus again face a question of a district court's application of its own local rules, to which we accord "a special degree of deference—above and beyond the traditional standards of decisionmaking and appellate oversight." In re Jarvis, 53 F.3d 416, 422 (1st Cir.1995). We find no abuse of discretion in the district court's consideration of the addendum, which contained relevant information to FirstBank's overall summary judgment position.
For these reasons, we reject Díaz-Santiago's challenges to the district court's denial of his strike/protective order motions.
B. Grant of Partial Summary Judgment and Denial of Motion to Alter or Amend Judgment
Díaz-Santiago does not clearly set forth his specific arguments as to why the district court should not have granted FirstBank's summary judgment motion. Instead, he inserts his summary judgment challenges in his discussion against the district court's denial of his Rule 59(e) motion to alter or amend judgment. We attempt to parse each argument out, addressing the district court's grant of summary judgment first.
1. Partial Summary Judgment Grant
We review the district court's grant of summary judgment de novo. Insituform Tech., Inc. v. Am. Home Assurance Co., 566 F.3d 274, 276 (1st Cir.2009). To prevail on summary judgment, the moving party must show that "there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed.R.Civ.P. 56. A fact is material if it "might affect the outcome of the suit" under governing law, Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986); likewise, an issue of fact is genuine if "a reasonable jury could resolve it in favor of
Díaz-Santiago points us to nothing in the record that raises a genuine issue of material fact. At most, Díaz-Santiago directs us to the fact that FirstBank allegedly knew the Policy contained a discrepancy as to the Black Sea owner's name (listing Díaz-Santiago as the owner instead of MDS), but still executed the Preferred Ship Mortgage and promissory note in MDS's name despite such knowledge. Specifically, Díaz-Santiago contends that FirstBank received a copy of the Policy— containing the owner error—on October 7, 2008, but that the Mortgage and promissory note were not signed with FirstBank until October 8, 2008, the same day Díaz-Santiago signed all documents officially incorporating MDS in the Virgin Islands and purchasing the Black Sea in MDS's name.
In essence, Díaz-Santiago argues that FirstBank held all the cards as of October 8, 2008, should have seen the documents' discrepancies for itself, and either informed Díaz-Santiago of such errors and/or refused to accept the Policy for its material error. Because it did not do so, Díaz-Santiago contends that FirstBank was acting with unclean hands
For reasons set forth infra in our Rule 59(e) discussion, we need not address the merits of Díaz-Santiago's unclean hands argument. We therefore examine the record as it stands to assess whether a genuine issue of material fact is present, construing the record and drawing all inferences therefrom in Díaz-Santiago's favor. We conclude that Díaz-Santiago's arguments on appeal are nothing more than a smokescreen to try and artfully evade the writing on the wall, which clearly shows the following:
First, MDS, and not Díaz-Santiago, is listed as the purchaser of the Black Sea vessel. Second, after MDS purchased the Black Sea, it executed a promissory note and Preferred Ship Mortgage in FirstBank's favor, obligating itself to insure the Black Sea to protect FirstBank's interest as a loss payee, and to pay for any costs incurred by FirstBank in defending suits related to the aforementioned agreements. Third, Díaz-Santiago and his wife signed a continuing letter of guaranty, confirming for FirstBank that they would jointly and severally assume any costs owed under the agreements should MDS default. Fourth, when Díaz-Santiago, on behalf of MDS, obtained the requisite insurance for the Black Sea from Markel, he misrepresented himself as the owner of the vessel, and not MDS. Fifth, following the Black Sea's seizure, FirstBank incurred various costs
Puerto Rico law makes clear that contracts shall be binding, regardless of the form in which they were executed, "provided the essential conditions required for their validity exist." P.R. Laws Ann. tit. 31, § 3451. Where the terms of a contract are clear, leaving no doubt as to the contracting parties' intentions, such contract will be observed according to "the literal sense of its stipulations." Id. § 3471. It is widely accepted that "[o]bligations arising from contracts have legal force between the contracting parties, and must be fulfilled in accordance with their stipulations." Id. § 2994. Where a party fails to uphold or abide by the contract's essential obligations, such failure will be deemed a breach of the contract. See Dantlzer, Inc. v. Lamas-Besos, No. 10-1004(PG), 2010 WL 2572618, at *3 (D.P.R. June 22, 2010) (stating that the elements of a cause of action for breach of contract under Puerto Rico law include "1) a valid contract and 2) a breach by one of the parties to the contract"); Torres v. Bella Vista Hosp., Inc., 523 F.Supp.2d 123, 152 (D.P.R.2007).
No party has disputed the validity of the contractual agreements between FirstBank and Díaz-Santiago, nor does the record reveal any facts suggesting their possible voidability. Pursuant to the express terms of the Preferred Ship Mortgage, MDS was required to "keep the vessel fully and adequately insured ... in at least the amount of the unpaid principal balance of the Mortgage," and would be held liable for any advances or expenditures that FirstBank incurred in defending suits related to the promissory note or Mortgage. Regarding the former obligation, Díaz-Santiago sealed his fate upon filing the Consent Motion with Markel, establishing a breach of his contractual obligation to FirstBank to obtain and maintain insurance on the Black Sea.
Regarding the latter obligation, it is clear that MDS, through the Mortgage, and Díaz-Santiago, via the continuing letter of guaranty, contractually bound themselves to reimburse FirstBank for any costs it incurred in defending suits related to the Mortgage or promissory note. FirstBank has more than satisfied its burden of establishing such costs.
Specifically, FirstBank initiated an administrative proceeding before the CBP, seeking to foreclose on the vessel's Mortgage when MDS defaulted in payments following the Black Sea's seizure. It then intervened in the subsequent criminal case, obtaining the voluntary dismissal of the
Stated most simply, FirstBank upheld its end of the bargain, and now Díaz-Santiago/MDS must do the same. We thus affirm the district court's grant of summary judgment to FirstBank, and its award of attorneys' fees, costs, and expenses arising from FirstBank's procured release of the Black Sea and defense of the policy's validity.
2. Motion to Alter or Amend Judgment
Charging once more unto the breach, Díaz-Santiago argues that the district court wrongly denied his Rule 59(e) motion in which he asserted that FirstBank violated the equitable doctrine of unclean hands when it permitted the execution of the Mortgage and promissory note in MDS's name despite knowing that the Policy already listed Díaz-Santiago as the vessel owner. Because FirstBank produced the discrepancy in the underlying documents, Díaz-Santiago asserts that FirstBank "was not entitled to relief," and "the judgment entered represents clear legal error and a manifest injustice" warranting an amendment or setting aside of the judgment pursuant to Federal Rule of Civil Procedure 59(e).
This Court reviews the district court's denial of post-judgment relief under Rule 59(e) for abuse of discretion. Williams v. Poulos, 11 F.3d 271, 289 (1st Cir.1993) ("The decision to grant or deny a Rule 59 motion is committed to the wide discretion of the district court and must be respected absent abuse."); Fernandez v. Leonard, 963 F.2d 459, 468 (1st Cir.1992). Generally, to prevail on a Rule 59(e) motion, the moving party "must either clearly establish a manifest error of law or must present newly discovered evidence." F.D.I.C. v. World Univ. Inc., 978 F.2d 10, 16 (1st Cir.1992); see also Marie v. Allied Home Mortg. Corp., 402 F.3d 1, 7 n. 2 (1st Cir.2005) (acknowledging four grounds for granting a Rule 59(e) motion: "manifest errors of law or fact, newly discovered or previously unavailable evidence, manifest injustice, and an intervening change in controlling law.") (citing 11 C. Wright et al., Federal Practice and Procedure § 2810.1 (2d ed.1995)). Notably, a party moving for Rule 59(e) relief may not repeat arguments previously made during summary judgment, Prescott v. Higgins, 538 F.3d 32, 45 (1st Cir.2008), nor may it present new arguments on a Rule 59(e) if such arguments "could, and should, have been made before judgment issued." ACA Fin. Guar. Corp. v. Advest, Inc., 512 F.3d 46, 55 (1st Cir.2008) (quoting F.D.I.C., 978 F.2d at 16).
A review of the record confirms that Díaz-Santiago raised his unclean hands argument for the first time in his Rule 59(e) motion. As we have repeatedly admonished parties, such motion is not the place to present arguments that could, and should, have been raised before the court's pulling of its judgment trigger. Id. Given the amount of motion practice that took
Additionally, neither the Rule 59(e) motion itself nor Díaz-Santiago's arguments on appeal in support of such motion show a manifest error of law or fact, a presentation of newly discovered evidence, or a significant change in governing law. Thus, Díaz-Santiago has failed to show any grounds that, under Rule 59(e), warrant an amendment, alteration, or setting aside of the district court's September 30 order, or any abuse of discretion on the part of the district court in applying Rule 59(e)'s standards. We thus affirm the district court's denial of Díaz-Santiago's Rule 59(e) motion.
III. Conclusion
Finding no error in the district court's rulings, we affirm.
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