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Peoples State Bank of Wyalusing, Pa v. Wellsburg Truck & Auto Sales

March 5, 2013

PEOPLES STATE BANK OF WYALUSING, PA, PLAINTIFF,
v.
WELLSBURG TRUCK & AUTO SALES, INC. AND THOMAS CICCOTTI, DEFENDANTS.



The opinion of the court was delivered by: Judge Caputo

MEMORANDUM

Presently before the Court are Plaintiff Peoples State Bank of Wyalusing, PA's Motions for Partial Summary Judgment (Docs. 56; 61), Motion to Strike Thomas Ciccotti's Brief in Opposition to the Motion for Partial Summary Judgment Against Wellsburg Truck & Auto Sales, Inc. (Doc. 68), and Motion to Strike Exhibits A, C, D, E, F, G, and I of the Brief in Opposition to the Motion for Partial Summary Judgment Against Thomas Ciccotti. (Doc. 70.) For the reasons that follow, Plaintiff's motions will be granted.

I. Background

A. Factual Background

Defendant Thomas Ciccotti ("Ciccotti") is the President of Defendant Wellsburg Truck & Auto Sales, Inc. ("Wellsburg"). (Docs. 6; 7, "Answer", ¶ 1.) During 2007 and 2008, the parties entered into a number of lending transactions that are the focus of this litigation.

First, on January 30, 2007, Wellsburg entered into a promissory note with Plaintiff in the original amount of $150,290.00 (the "January 30, 2007 Note"). (Compl., ¶ 6; Answer ¶ 2.) To secure repayment of the January 30, 2007 Note, Ciccotti caused Wellsburg to grant Plaintiff a security interest in all of Wellsburg's business assets. (Id.) Also on January 30, 2007, Ciccotti executed a personal guaranty in favor of Plaintiff guaranteeing repayment of the January 30, 2007 Note (the "2007 Note Guaranty"). (Compl., ¶ 8; Answer ¶ 3.) Under the terms of the January 30, 2007 Note, Wellsburg was to make sixty (60) monthly payments of $3,164.36 beginning on February 28, 2007 and ending on February 28, 2012. (Compl., ¶ 9; Answer ¶ 3.) Wellsburg last made a payment on the January 30, 2007 Note on September 30, 2008. (Doc. 62, Gagliardi Aff., ¶ 6.) Ciccotti has yet to make any payments on the January 30, 2007 Note. (Id. at ¶ 8.)

On July 8, 2008, Wellsburg entered into a promissory note with Plaintiff in the original amount of $249,575.44 (the "July 8, 2008 A Note"). (Compl., ¶ 14; Answer ¶ 5.) To secure repayment of the July 8, 2008 A Note, Ciccotti caused Wellsburg to grant to Plaintiff a security interest in all of Wellsburg's business assets. (Id.) Ciccotti executed a personal guaranty in favor of Plaintiff guaranteeing repayment of the July 8, 2008 A Note (the "2008 A Note Guaranty"). (Compl., ¶ 15; Answer ¶ 3.) The terms of the July 8, 2008 A Note provided that Wellsburg would make five (5) monthly interest payments ranging from $1,455.86 to $1,504.39 beginning on August 8, 2008 and one (1) payment of $251,079.83 on January 8, 2009. (Compl., ¶ 16; Answer ¶ 3.) No payment has been made by Wellsburg on the July 8, 2008 A Note since September 30, 2008. (Gagliardi Aff., ¶ 13). Ciccotti has failed to make any payments on the July 8, 2008 A Note. (Id. at ¶ 15.)

Also on July 8, 2008, Plaintiff and Wellsburg entered into a promissory note in the original amount of $125,000.00 (the "July 8, 2008 B Note"). (Compl., ¶ 21; Answer ¶ 6.) Plaintiff was granted a security interest in Wellburg's business assets to secure repayment of the July 8, 2008 B Note. (Id.) A personal guaranty was executed by Ciccotti in favor of Plaintiff guaranteeing repayment of the July 8, 2008 B Note (the "2008 B Note Guaranty"). (Compl., ¶ 22; Answer ¶ 3.) Wellsburg agreed under the terms of the July 8, 2008 B Note to make monthly payments of accrued interest calculated on the amount of credit outstanding beginning on August 8, 2008 and principal plus any unpaid interest due on demand. (Compl., ¶ 23; Answer ¶ 3.) Wellsburg has not made a payment on the July 8, 2008 B Note since September 30, 2008. (Gagliardi Aff., ¶ 20.) Ciccotti has failed to make any payments on the July 8, 2008 B Note despite Plaintiff's demand for payment. (Id. at ¶¶ 25-26.)

Also, on July 8, 2008, Plaintiff entered into a promissory note with Wellsburg in the original amount of $147,500.00 (the "July 8, 2008 C Note"). (Compl., ¶ 28; Answer ¶ 7.) Wellsburg granted Plaintiff a security interest in all its business assets to secure repayment under the July 8, 2008 C Note. (Id.) Ciccotti also executed a personal guaranty in favor of Plaintiff guaranteeing repayment of the July 8, 2008 C Note (the "2008 C Note Guaranty"). (Compl., ¶ 29; Answer ¶ 3.) Wellsburg agreed to make five (5) monthly interest payments ranging from $983.33 to $1,016.00 beginning on August 8, 2008 and one payment of $148,516.11 on January 8, 2009 under the terms of the July 8, 2008 C Note. (Compl., ¶ 30; Answer ¶ 3.) Wellsburg last made a payment on the July 8, 2008 C Note on September 30, 2008. (Gagliardi Aff., ¶ 30.) No payments have been made on the July 8, 2008 C Note by Ciccotti despite Plaintiff's demand for payment. (Id. at ¶¶ 32-33.)

On October 9, 2008, Wellsburg and Plaintiff entered into a promissory note in the original amount of $100,000.00 (the "October 9, 2008 Note"). (Id. at ¶ 35.) Ciccotti executed a personal guaranty for repayment of the October 9, 2008 Note (the "October 9, 2008 Note Guaranty"). (Gagliardi Aff., ¶ 36.) The October 9, 2008 Note provided that Wellsburg was to make monthly payments of accrued interest calculated on the amount of credit oustanding beginning on November 6, 2008 and a principal payment due on July 6, 2009. (Compl., ¶ 37; Answer ¶ 3.) Neither Wellsburg nor Ciccotti has ever made a payment on the October 9, 2008 Note despite the demand for payment. (Gagliardi Aff., ¶¶ 37-39.)

Lastly, on November 20, 2008, Plaintiff and Wellsburg entered into a promissory note in the original amount of $286,000.00 (the "November 20, 2008 Note"). (Id. at ¶ 41.) Ciccotti also executed a personal guaranty of the November 20, 2008 Note (the "November 20, 2008 Guaranty"). (Compl., ¶ 42; Answer ¶ 3.) No payments have been made on the November 20, 2008 Note by either Wellsburg or Ciccotti. (Gagliardi Aff., ¶¶ 43-45.)

Plaintiff has not assigned or transferred the January 30, 2007 Note, the 2007 Note Guaranty, the July 8, 2008 A Note, the 2008 A Note Guaranty, the July 8, 2008 B Note, the 2008 B Note Guaranty, the July 8, 2008 C Note, the 2008 C Note Guaranty, the October 9, 2008 Note, the October 9, 2008 Note Guaranty, the November 20, 2008 Note, or the November 20, 2008 Note Guaranty to any other institution. (Id. at ¶ 47.) The notes and guaranties continue to be held by Plaintiff. (Id.)

As of June 18, 2012, the outstanding balances on the notes were: $155,776.82 on the January 30, 2007 Note; $302,279.95 on the July 8, 2008 A Note; $151,762.43 on the July 8, 2008 B Note; $193,898.80 on the July 8, 2008 C Note; $192,598.86 on the October 9, 2008 Note; and $347,207.65 on the ...


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