United States District Court, District of Maryland
NORMAN UNDERSTEIN AS TRUSTEE OF THE JILL S. PARRECO REVOCABLE TRUST, et al.
Deborah K. Chasanow United States District Judge
Presently pending and ready for resolution in this action for confessed judgment are the following motions: (1) motion to vacate confessed judgment filed by Defendant Thomas McKiver (“Defendant” or “Mr. McKiver”) (ECF No. 20); (2) motion for summary judgment filed by Plaintiffs Norman Understein as Trustee of the Jill S. Parreco Revocable Trust, Norman Understein as Trustee of the Norman Understein Revocable Trust, and Norman Understein as Agent for Purchasers (collectively, “Plaintiffs”) (ECF No. 28); (3) motion to dismiss counterclaim filed by Plaintiffs (ECF No. 37); and (4) motion to withdraw four prior filings filed by Defendant (ECF No. 44). The court now rules, no hearing being deemed necessary. Local Rule 105.6. For the following reasons, Defendant’s motion to dismiss his previously filed motion to vacate confessed judgment, counterclaim, opposition to motion for summary judgment, and third-party complaint will be granted. Plaintiffs’ motions for summary judgment and to dismiss the counterclaim will be denied as moot.
A. Factual Background
Norman Understein is a Trustee of the Jill S. Parreco Trust and the Norman Understein Trust and is agent for Purchasers under two Secured Debentures. (ECF No. 27, at 1). Defendant is a borrower and guarantor on loans that have been fully advanced and are now in default, payable to Plaintiffs. (Id. ¶ 3). Wendy and Simon (Oscar) Bond joined Defendant in two business ventures located in Bloomfield, New Jersey. (Id.). The two businesses owned by Defendant with the Bonds operate under the following corporate entities: 554 Bloomfield, LLC (“554 LLC”), which owns and operates a commercial building; and BND Salon Corporation (“BND”), which owns and operated a cosmetology school located in that same building. (Id. ¶ 5).
In 2012, 554 LLC and BND encountered financial difficulties and Mr. Understein was asked to provide financial assistance in the form of a loan. (Id. ¶ 6). Mr. Understein arranged loans to keep the businesses in operation. According to Plaintiffs’ amended complaint, “to guard against the risk of non-payment, the loans were secured and guaranteed personally by the three business owners, [Mr. McKiver and the Bonds].” (Id. ¶ 6). Defendant, Wendy Bond, and Simon Bond (aka Oscar Bond) signed a Demand Promissory and Line of Credit Note, dated April 23, 2012, for $100, 000, each individually and all jointly together as “Borrower.” (ECF No. 27-1). Defendant and the Bonds promised to repay the $100, 000 to Norman Understein and Jill Parreco. (Id. at 1). The principal amount of the Demand Promissory and Line of Credit Note was advanced pursuant to three advance requests, all of which are signed by Mr. McKiver. (ECF No. 27-1, at 5-7). Paragraph 6(B) of the Note states:
If I do not pay the full amount of each payment on the date it is due, or if I am in default under any other promissory note (either as an individual borrower, joint borrow[er], or guarantor), then I will be in default under this Note.
(Id. at 2). The Note provides for late charges on overdue payments, and for attorney’s fees and costs if enforcement is required. (Id. at 2-3). The Note also authorizes judgment by confession in the event of default. (Id. at 4). Paragraph 8 governs obligations of persons under the Note:
If more than one person signs this Note, each person is fully and personally obligated to keep all of the promises made in this Note, including the promise to pay the full amount owed. Any person who is a guarantor, surety or endorser of this Note is also obligated to do these things. Any person who takes over these obligations, including the obligations of a guarantor, surety or endorser of this Note, is also obligated to keep all of the promises made in this Note. The Note Holder may enforce its rights under this Note against each person individually or against all of us together. This means that any one of us [Wendy Bond, Oscar Bond, or Thomas McKiver] may be required to pay all of the amounts owed under this Note.
(Id. at 3) (emphasis added).
Additionally, Defendant and the Bonds signed two Secured Debentures as Guarantors. (ECF Nos. 27-2 & 27-3). Each Secured Debenture, dated February 12, 2012, provides for a $50, 000 loan to be repaid to Jill S. Parreco Revocable Trust (ECF No. 27-2) and Norman Understein Revocable Trust (ECF No. 27-3). Each trust is designated as a “Purchaser” of each Secured Debenture, and Norman Understein is designated as “Purchaser’s Agent.”
In February 2012, 554 LLC and BND signed a Loan and Security Agreement as borrowers, creating a security interest in all of their assets for the benefit of the Purchasers of the Secured Debentures identified above. (ECF No. 27-4). Norman Understein signed the Loan and Security Agreement as the Purchasers’ Agent. (Id. at 10). Mr. McKiver did not sign the Loan and Security Agreement. On January 30, 2012, however, Mr. McKiver and the Bonds signed a document entitled “Action of Directors in lieu of Meeting, ” authorizing BND to join in the Loan and Security Agreement, acknowledging that 554 LLC “will borrow an aggregate of up to $500, 000 from certain lenders pursuant to debentures  to be issued by the LLC to the payees named therein  and a loan and security agreement with the lenders.” (ECF No. 27-6). This document also stated that BND “is authorized to become a party to the Loan Agreement, pursuant to which, among other things, it will grant to the Lenders a security interest in all of the assets of BND.” (Id.).
On February 15, 2012, Mr. McKiver and the Bonds signed a Guaranty. (ECF No. 27-5). The Guaranty states in relevant part:
Each Guarantor jointly and severally guaranties (a) payment of any and all sums now or hereafter due and owing to each Purchaser by the Borrower as a result of or in connection with the Debentures, and any and all existing or future indebtedness, liability, or obligation of every kind, nature, type, and variety owed by the Borrower to each Purchaser arising out of or related to (i) the Debentures, including, but not limited to, all amounts of ...