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Sand Creek Partners, LTD v. American Federal Savings & Loan Association of Colorado

United States District Court, District of Nevada

January 26, 2015

SAND CREEK PARTNERS, LTD, et al., Plaintiffs,
v.
AMERICAN FEDERAL SAVINGS AND LOAN ASSOCIATION OF COLORADO, ., Defendants.

ORDER

CAM FERENBACH, MAGISTRATE JUDGE.

This matter involves the Cadle Company’s post-judgment execution proceeding against Larry Bortles. Three motions are before the court: (1) the Cadle Company’s Motion for Aid (#16[1]); (2) the Cadle Company’s Motion to Compel (#18); and (3) Larry Bortles’ Motion to Vacate (#23). For the reasons stated below, the Cadle Company’s Motion for Aid is granted, the Cadle Company’s Motion to Compel is denied, and Larry Bortles’ Motion to Vacate is denied.

BACKGROUND

In the 1980s, business partners Larry Bortles and William Bergman executed a construction loan agreement with American Federal Savings of the State of Colorado to build the Sand Creek Business Park in Commerce City, Colorado. Months into the project, American Federal Savings experienced capital shortfalls and stopped funding the Sand Creek Project. On April 13, 1989, Bortles and Bergman sued American Federal Savings in Adams County District Court and prevailed.

This, however, did not end the matter. On April 27, 1989, American Federal Savings’ receiver, the Federal Savings and Loan Insurance Corporation (“FSLIC”), substituted into the action as the real party in interest, removed the action to the United States District Court for the District of Colorado, set aside Bortles and Bergman’s judgment under the D’Oench Duhme Doctrine, and filed counterclaims against the Bortles and Bergman.

The Resolution Trust Corporation (“RTC”) then replaced the FSLIC under the newly enacted Financial Institutions Reform, Recovery, and Enforcement Act of 1989, 12 U.S.C. § 1441a, et seq., and obtained two judgments against Bortles on the FSLIC’s counterclaims. (See Judgments (#25) at 21, 24). On January 7, 1991, and August 25, 1992, the Honorable Jim R. Carrigan, U.S. District Judge for the District of Colorado, awarded RTC (1) $2, 878, 910.65 plus $742, 002.39 in interest and late charges and (2) $954, 375.00 plus $18, 213.00 in interest. (Id.)

Bortles refused to satisfy the RTC’s judgments. Consequently, the lawsuit continued and parties came and went as RTC’s judgments were assigned from creditor to creditor over the course of the next eight years. On September 29, 1995, RTC assigned the judgments to Premier Financial Services West, LP. On December 31, 1995, the RTC ceased operations pursuant to 12 U.S.C. § 1441a(m)(1), and the Federal Deposit Insurance Corporation (“FDIC”) was named as its successor. On July 13, 1998, the Honorable John L. Kane, U.S. District Judge for the District of Colorado, substituted Premier Financial Services West, LP for RTC and amended the caption. On December 16, 1999, the FDIC assigned RTC’s judgment, again, to Premier Financial Services West, LP. Finally, on October 13, 1999, Premier Financial Services West, LP assigned the judgments to the Cadle Company, the current judgment creditor.

Ten more years passed, and the time to execute the judgments was expiring. Colorado Rule of Civil Procedure 54(h) provides that “[a] revived judgment must be entered within twenty years after the entry of the judgment which it revives, and may be enforced and made a lien in the same manner and for like period as an original judgment.” See also Colo. Rev. Stat. § 13-52-102 (West) (providing for a twenty-year statute of limitations on judgments).

Accordingly, on December 9, 2010, nineteen years after the first judgment was entered, the Cadle Company moved to revive both judgments, arguing that it “is the successor in interest to the original [judgment creditor] in this matter, as evidenced by the appropriate Assignments of Judgment attached hereto.” (See Doc. #25 at 15 ¶ 3). The court agreed. On January 20, 2011, the Honorable Craig B. Shaffer, U.S. Magistrate Judge for the District of Colorado, revived both judgments “nunc pro tunc to be effective January 7, 2011.” (See Doc. #1 at 2).

Four months later, on April 20, 2011, the Cadle Company came to the District of Nevada, where Bortles now resides, to execute its judgments. (See id.) On March 21, 2014, the Cadle Company moved for a judgment-debtor exam. Three motions relating to the judgment-debtor exam are now before the court.

First, on August 12, 2014, the Cadle Company moved for aid regarding its writ of execution. (Doc. #16). During the judgment-debtor exam, Bortles testified that he is the owner of general partnership interests in two active limited partnerships: Fiji Marina Partners Limited Partnership and Fiji Pacific Partners Limited Partnership. (Id. at 1:24-28). Bortles further testified that one of the partnerships recently sold property it owned, the proceeds of which are being held by Bortles’ attorney, Mitch Cobeaga, pending distribution by the general partner, Larry Bortles. (Id.) However, Bortles also testified that while he is the sole general partner of both partnerships, he owns “zero percent” interest in each limited partnership. (Id. at 2:23-25). The Cadle Company, therefore, seeks an order “requiring the surrender of the actual partnership interest, and all rights thereto.” (Id. at 3:4-7).

Second, on August 27, 2014, the Cadle Company moved to compel. (Doc. #18). The motion requests an order compelling Bortles to (1) answer specific questions regarding the sale property and location of the proceeds from the sale and (2) provide related supporting documents that evidence the sale and location of the proceeds. (Id. at 1:20-24).

Third, on December 19, 2014, Bortles filed a Motion to Vacate. (Doc. #25). Bortles contends that the various assignments of the judgments were flawed and, therefore, the District of Colorado’s ...


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