Nesse v. Arnold

1 The court notes that the Opposition is erroneously titled "Debtor's Opposition to
Trustee's Motion for Summary Judgment." The debtor herein is Real Estate Investors
Advantage, LLC, and is not a party to this adversary proceeding.
IN THE UNITED STATES BANKRUPTCY COURT
FOR THE DISTRICT OF MARYLAND
at Greenbelt
In Re: 	Case No. 06-15528PM
Chapter 7
Real Estate Investors Advantage, LLC,
Debtor.
Janet M. Nesse, Trustee, 	AP No. 06-01783PM
Plaintiff,
v.
Nathaniel Xavier Arnold,
Defendant.
MEMORANDUM OF DECISION
This matter came before the court for hearing on June 21, 2007, on the Chapter 7 Trustee's
Motion for Summary Judgment, and the Opposition of defendant Nathaniel Xavier Arnold.1
The Chapter 7 Trustee commenced this adversary proceeding on November 6, 2006,
pursuant to 11 U.S.C § 542, seeking judgment against the defendant in the amount of $71,159.00,
plus pre- and post-judgment interest, and the costs and fees incurred in the action.
The undisputed facts, as set forth by the Chapter 7 Trustee in her Motion, are that the
defendant is the president and majority shareholder of the debtor, Real Estate Investors Advantage,
LLC. In 2004, as reflected on the debtor's federal tax return, a loan was made to a shareholder. The
balance of the loan, as of the end of 2004, was $71,159.00. Deposition testimony of the defendant
and accountant Patrick Carter, taken on April 24, 2007, albeit ambiguous, indicated that, in all
Date signed June 22, 2007
Entered: June 22, 2007 Case 06-01783 Doc 23 Filed 06/22/07 Page 1 of 2

likelihood, the loan was made by the debtor to the defendant.
At the hearing in this matter, counsel for the defendant represented that the defendant did
not dispute that the debtor made a loan for his benefit, the balance of which totaled $71,159.00 as of
the end of 2004. However, in defense and in support of denial of the Chapter 7 Trustee's Motion,
counsel asserted that summary judgment was improper because the amount of the loan was in
dispute as the defendant had repaid certain amounts, reducing the obligation.
Having admitted the obligation on the record in open court and failing to proffer competent
evidence with respect to any repayment of the loan, the Chapter 7 Trustee's Motion will be granted.
The discussion on the record as to the debtor's corporate records was wholly immaterial as the very
best evidence in defense of this action is the defendant's cancelled checks reflecting payment to the
debtor, readily available to the defendant from his financial institution. The court notes that the
defendant had seven months to prepare a defense and obtain documentary evidence in support
thereof. Counsel's representation that the defendant is planning to request such documents for trial
is simply not enough to justify denial of summary judgment.
An appropriate order will be entered in accordance with this decision.
cc: 	Janet M. Nesse
Stinson Morrison Hecker
1150 18th Street
Suite 800
Washington, DC 20036
Nathaniel Xavier Arnold
9716 Kisconke Road
Ft. Washington, MD 20744
Jonathan C. Silverman
Garza, Regan & Associates, P.C.
17 West Jefferson St.
Rockville, MD 20850
End of Memorandum of Decision
Case 06-01783 Doc 23 Filed 06/22/07 Page 2 of 2