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California Bank & Trust v. Shilo Inn, Seaside East, LLC

United States District Court, D. Oregon

December 17, 2014

CALIFORNIA BANK & TRUST, as assignee of the Federal Deposit Insurance Corporation, as receiver for Vineyard Bank, a California banking corporation, Plaintiff,
v.
SHILO INN, SEASIDE EAST, LLC, an Oregon limited liability company, and MARK S. HEMSTREET, an Oregon resident, Defendants.

Eric D. Lansverk, Joseph A.G. Sakay, HILLIS CLARK MARTIN & PETERSON, Seattle, WA, Hal Mark Mersel, Ren R. Hayhurst, BRYAN CAVE LLP, Irvine, CA, Attorneys for Plaintiff.

Sherrie D. Martinelli, Charles R. Markley, Greene & Markley, P.C., Portland, OR, Attorneys for Defendants.

OPINION & ORDER

MARCO A. HERNNDEZ, District Judge.

Defendants Shiloh Inn, Seaside East, LLC, and Mark Hemstreet bring this motion ("Defendants' Motion") under Federal Rule of Civil Procedure 15(d) for leave to file supplemental counterclaims in response to Plaintiff California Bank & Trust's supplemental verified complaint. Also before the Court are requests for judicial notice pursuant to rule 201 of the Federal Rules of Evidence. Plaintiff requests that the Court take judicial notice of two orders issued by this Court and two orders and two docket listings from the United States District Court for the District of Idaho and Eastern District of Washington. Defendants request that the Court take judicial notice of an order and hearing transcript from the United States District Court for the Eastern District of Washington.

For the reasons that follow, the Court grants Defendants' Motion. The Court declines to address the requests for judicial notice of orders and docket listings from other district courts, because they are not determinative to the Court's decision concerning Defendants' Motion. As to the two orders issued by this Court, they are already properly before the Court (ECF Nos. 79, 84); therefore, judicial notice is not necessary.

BACKGROUND

On March 21, 2012, Plaintiff filed a complaint against Defendants related to alleged defaults by Defendants under commercial loans secured by deeds of trust encumbering real property and improvements.[1] Plaintiff commenced foreclosure actions against Shilo Inn. Plaintiff also named Mr. Hemstreet as a defendant in relation to a personal line of credit.

In the complaint, Plaintiff sought: (1) the appointment of a receiver to protect its interest in the rents collected by Shilo Inn and an injunction to prevent Shilo Inn and Mr. Hemstreet from interfering with the receiver's duties; (2) an accounting of receipts, rents, income, and profits collected by Shilo Inn; and (3) a judicial foreclosure of Plaintiff's liens and security interests in the Shilo Inn property. On May 11, 2012, this Court issued an order, stating that while Plaintiff was entitled to the appointment of a receiver, equity required Plaintiff to provide Defendants with a payoff amount within seven days and an opportunity for Defendants to render the payoff amount within fourteen days thereafter. If Defendants timely paid the payoff amount, Plaintiff's motion for the appointment of a receiver and injunction would be moot; however, if Defendants failed to timely pay the amount due, then the Court would appoint a receiver.

Between May 17 and June 14, 2012, Plaintiff forwarded the reinstatement figures for each of the properties, including claimed attorney's fees and punitive default interest. Defendants disputed the claimed attorney's fees; therefore, the Court ordered Defendants to pay all sums due except the disputed fees, which would be addressed by the Court at a later date. Defendants tendered the amounts requested except the disputed attorney's fees.[2] In July 2012, Plaintiff notified Defendants that their tender was insufficient to reinstate the loans and that, therefore, Defendants were still in default.

On October 1, 2012, the Court entered an order granting Plaintiff leave to supplement its complaint to reflect the following factual allegations:

(1) Plaintiff reminded Defendants in a letter on June 15, 2012, that further events of default would exist under the loan documents if required actions were not completed by the end of the "Forbearance Period" (as defined in the Second Amendment), which was set to expire on June 30, 2012;
(2) Pursuant to Sections 2(d)(iv) and (v) of the Second Amendment, "Selling Borrowers" were required to have sold the "Sale Properties" on or before June 30, 2012 to pay down the outstanding balances (as all such terms are defined in the Second Amendments) of the loans;
(3) "Post Closing Obligations" (as defined in the Hemstreet First Amendment) were to be satisfied no later than August 17, 2011 pursuant to ...

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