                                                                               United States Court of Appeals
                                                                                        Fifth Circuit
                                                                                      F I L E D
                           UNITED STATES COURT OF APPEALS
                                                                                      August 18, 2003
                                FOR THE FIFTH CIRCUIT
                                                                                  Charles R. Fulbruge III
                                  _________________________                               Clerk
                                         No. 02-31134
                                    SUMMARY CALENDAR
                                  _________________________

QUANTAM VARDE ASSET FUND LLC

                       Plaintiff - Appellee

   v.

TIM TYLER ZUFFLE; Et Al

                       Defendants

TIM TYLER ZUFLE; DIANE REED ZUFLE

                  Defendants - Appellants
______________________________________________________________________________

                 On Appeal from the United States District Court for the
                  Eastern District of Louisiana, New Orleans Division
                                      (90-CV-2058)
______________________________________________________________________________

Before REYNALDO G. GARZA, HIGGINBOTHAM, and BENAVIDES, Circuit Judges.

REYNALDO G. GARZA, Circuit Judge:1

        In this appeal we are asked to review a district court’s decision granting summary

judgment in favor of Quantum Varde Asset Fund, LLC (“Quantum”), on its motion to revive a

judgment against Tim Tyler Zufle and Diane Reed Zufle. For the following reasons, we affirm the



        1
        Pursuant to 5th Cir. R. 47.5, the Court has determined that this opinion should not be
published and is not precedent except under the limited circumstances set forth in 5th Cir. R.
47.5.4.

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district court’s decision.

                         I. FACTUAL & PROCEDURAL BACKGROUND

        In December of 1998, Silent Partner, Inc. (“SPI”), obtained two loans from Bankers Trust

of Louisiana, N.A. The loans were, in principal, for $282,000.00 and $100,500.00. Appellants

Tim Tyler Zufle and Diane Reed Zufle endorsed promissory notes for the loans, binding

themselves, in solido, with SPI for the repayment of the financial obligations.

        Not unlike many of its temporal counterparts, the Louisiana bank failed and was placed

into receivership. Thereafter, the Federal Deposit Insurance Corporation (“FDIC”) was appointed

liquidator, and when the borrower defaulted on the loan, the FDIC brought suit on the notes. The

parties entered into a consent judgment (“1991 Judgment” or “Judgment”) before the case was

tried, which resulted in judgment being entered in favor of the FDIC, and against the Zufles, for

the amount allegedly due on one of the two notes, which equaled $227,820.00, plus accrued

interest of $36,616.53, plus subsequently accruing interest.2

        According to the Appellee, the FDIC assigned the 1991 Judgment to the Reliant Group

(“Reliant”) in June of 1997. Appellee further alleges that in November of 1998, it was assigned

Reliant’s interest in the Judgment. On May 17, 2000, Quantum filed a motion to be substituted as

party plaintiff in order to enforce the Judgment. That motion was granted by the district court.

        On February 16, 2001, Quantum filed suit in the district court to revive the Judgment.

Although Mr. Zufle was served, Quantum could not locate Mrs. Zufle for service. It was later

established that the Zufles had divorced and that Mrs. Zufle had left the state.



        2
         Tim Zufle had been the Chief Executive Officer of SPI, which was not a party to the
consent judgment because it had declared bankruptcy.

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       After Mr. Zufle filed an answer, Quantum moved for summary judgment. Mr. Zufle

opposed the motion on the grounds that the judgment had prescribed, or, alternatively, that

Quantum did not have the legal right to recover the judgment because it had not acquired

anything more than a promissory note. Judge Sear granted Quantum’s motion for summary

judgment and revived the 1991 Judgment, finding that, based on the language of the transfer and

assignment documents, the FDIC had assigned its interest in the 1991 Judgment to Reliant, and

that Reliant had subsequently assigned that same Judgment interest to Quantum.

       Mr. Zuffle then attempted to appeal the district court’s decision to this Court. However,

that appeal was dismissed for lack of jurisdiction, given that judgment had not yet been rendered

against Mrs. Zufle.

       At around the same time, Mrs. Zufle was located in Texas. After being served, Mrs. Zufle

filed a motion to dismiss, raising essentially the same defenses as had her ex-husband. After the

motion was denied, Mrs. Zufle filed her answer and Quantum moved for summary judgment. The

matter was transferred to Judge Sarah Vance, who granted Quantum’s motion and entered a final

judgment which revived the 1991 Judgment as to both defendants, who have since filed timely

notice of their appeal.

                                         II. DISCUSSION

       On appeal, Appellants argue that a clear and unambiguous interpretation of the relevant

documents establishes that the 1991 Judgment was never transferred from its original holder, the

FDIC. As a result, the Appellants aver that Quantum did not have standing to revive the 1991

Judgment. In addition, because the ten-year period for reviving a judgment under Louisiana law

has now expired, Appellants claim that any further attempt to revive the judgment should be


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barred.3

A. Standard of Review

       We review a grant of summary judgment de novo, applying the same standards as the

district court. Performance Autoplex II Ltd. v. Mid-Continent Casualty Co., 322 F.3d 847, 853

(5th Cir. 2003). Summary judgment should be granted if there is no genuine issue of material fact

for trial and the moving party is entitled to judgment as a matter of law. Id.

       Appellants did not offer any summary judgment evidence of their own in response to

Quantum’s motion. Rather, their position was –and continues to be– that the documents relating

to the alleged transfer of the 1991 Judgment speak for themselves, and that said documents

demonstrate that Quantum was not assigned any interest in the 1991 Judgment. Resolution of this

appeal therefore turns on whether or not the summary judgment evidence submitted by Quantum

demonstrates that it was the owner of the 1991 Judgment sought to be revived.

B. Applicability of New York Law

       The 1997 Assignment and Bill of Sale between the FDIC and Reliant expressly provides

that it shall be governed by and construed in accordance with New York law. The district court

correctly determined, and the parties agree, that New York law will govern the interpretation of



       3
         The district court found, and we agree, that Quantum filed its complaint before the
judgment prescribed. See LA. CIV. CODE ANN. art. 3501 (West 2002); LA. CODE CIV. PROC.
ANN. art. 2031 (West 2002). Thus, Louisiana law regarding the prescription of judgments would
only be pertinent to this appeal if, for some reason, it is determined that Quantum was not the
proper party to attempt to revive the 1991 Judgment. See LA. CODE CIV. PROC. ANN. art. 2031
(West 2002)(requiring that a party have an interest in the judgment at issue in order to bring an
action to revive it). For the reasons set out in the following portions of this opinion, we have
determined that Quantum was an “interested party” in relation to the 1991 Judgment, and,
therefore, the application of Louisiana law pertaining to the prescription of judgments is of no
consequence.

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the 1997 documents. See N.Y. Oblig. Law § 5-1401. Because the resolution of this appeal hinges,

for the most part, on the proper interpretation of the 1997 transfer documents, when appropriate

we will turn to the laws of New York for guidance.

C. Appellants’ Arguments Regarding the Alleged Transfer of the 1991 Judgment

       The crux of the Appellants’ appeal is their argument that the documents presented by

Quantum show that the attempted initial transfer of the 1991 Judgment from the FDIC to Reliant

was unsuccessful, and that, therefore, Reliant could not and did not transfer the Judgment to its

alleged successor, Quantum.

       As previously noted, the initial –alleged– transfer of the 1991 Judgment took place in

1997. The 1997 Assignment and Bill of Sale identifies and references the partnership agreement

used to create Reliant, and incorporates certain definitions found in that earlier agreement. Exhibit

“A” of the 1997 Assignment and Bill of Sale between the FDIC and Reliant refers to an asset

labeled “Silent Partner, Inc.” The book value of the asset is listed as $264,436.70.

       Appellants argue that, because the documents detailing the transfer of various assets from

the FDIC to Reliant refer only to “Silent Partner, Inc.,” all that was intended to be transferred was

the underlying promissory note and not the Judgment. In support of this argument, Appellants

point out that there is no judgment against Silent Partner, Inc. –because it was in bankruptcy– and

further note that there is no mention of either the Zufles or the 1991 Judgment in the 1997

Agreement. In other words, Appellants allege that the only thing transferred from the FDIC to

Reliant was an interest in a now defunct promissory note.

       Quantum counters that the FDIC’s assignment of the Judgment to Reliant, and Reliant’s

subsequent assignment of the same to Quantum, were both properly documented. More


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specifically, Quantum asserts that the transfer documents reflect the parties’ intent to transfer the

“asset” known as the “Silent Partner” asset, which included the promissory note executed by

Silent Partner and the consent judgment rendered against the Zufles based on that note. Put

another way, Quantum’s position is that use of the term “Silent Partner” when referring to the

asset at issue was merely a label for the bundle of interests related to the promissory note, which

included the interest in the 1991 Judgment.

       (1.) The 1997 Transaction. According to the Assignment and Bill of Sale between the

FDIC and Reliant, the 1997 transaction included the transfer of “all of the Seller’s right, title and

interest, if any, in and to the ‘JDC’ and ‘Small Balance Assets’ (as such terms are defined in the

Contribution Agreement) listed on Exhibit A attached hereto.”

       The Contribution Agreement incorporates the definitions of the terms “JDC” and “Small

Balance Assets” used in the Agreement of Limited Partnership (“Partnership Agreement”), which

created Reliant. The Partnership Agreement defines the term “JDC” as, “Collectively, Judgments,

Deficiencies and Charge Offs.” Furthermore, the term “Judgment” is defined as, “The right to

receive a sum of money in payment of an obligation created by a court order, writ or decree which

is evidenced by an official certificate of such court.” The term “Assets” means “Any JDCs and

Small-Balance Assets which are to be contributed to the Partnership by the Limited Partner on the

Closing Date pursuant to the Contribution Agreement and any JDCs and Small-Balance Assets

which may be contributed to the Partnership by the Limited Partner subsequent to the Closing

Date pursuant to the Contribution Agreement.” Additionally, Small-Balance Assets” are “The

right to receive from any Person a sum of money in payment of an obligation of such Person

(whether secured in whole or in part by collateral other than real estate or unsecured), which right


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may not be characterized as a Judgment, Deficiency or Charge-off.”

       The district court found that the asset at issue fell within the “JDC” category. The district

court also determined that the reference to “Silent Partner” in the 1997 Agreement was not

intended to limit the nature of the transfer from the FDIC to Reliant, but rather was “merely a

descriptive term used to describe the asset, which by 1997 unequivocally consisted of a judgment

against the endorsers of the original Silent Partner note.” F.D.I.C. v. Zufle, 2001 WL 1602139, at

*2 (E.D.La. Dec 13, 2001). We agree with the district court’s conclusion.

       (2.) New York Law. New York law pertaining to the interpretation of contracts is similar

to that of most states, including Louisiana. One New York court has commented that:

       The interpretation of a written agreement is within the province of the court and, if the
       language of the agreement is free from ambiguity, its meaning may be determined as a
       matter of law on the basis of the writing alone without resort to extrinsic evidence.

Hickman v. Saunders, 228 A.D.2d 559, 560, 645 N.Y.S.2d 49, 50 (N.Y. Sup. Ct. 1996). New

York law also clarifies that “[a] contract is not deemed ambiguous unless ‘it is reasonably

susceptible [to] more than one interpretation, and a court makes this determination by reference

to the contract alone.’” Banque Arabe v. Maryland National Bank, 57 F.3d 146, 152 (2d Cir.

1995)(quoting Burger King Corp. v. Horn & Hardart Co., 893 F.2d 525, 527 (2d Cir. 1990)).

       Although no particular form or language is required to create an assignment under New

York law, there is a need for some “act or words” that manifest an intent to assign. Property

Asset Management, Inc. v. Chicago Title Insurance Co., Inc., 173 F.3d 84, 87 (2d Cir. 1999); see

also Miller v. Wells Fargo Bank International Corp., 540 F.2d 548, 557 (2d Cir. 1976)(“Any act

or words are sufficient which show an intention of transferring the chose in action to the assignee,

when the assignor is divested of all control and right to cause of action and the assignee is entitled


                                                 -7-
to control it and receive its fruits”).

        For purposes of determining whether the contract is ambiguous, we ignore –for the

moment– the fact that each party espouses a different interpretation of its terms and look solely to

the contract itself.

        According to the terms of the 1997 Assignment and Bill of Sale, the FDIC transferred to

Reliant, “all of the [FDIC’s] right, title and interest, if any, in and to the ‘JDC’ and ‘Small Balance

Assets’ . . . listed on Exhibit A.” The chosen language would seem, clearly, to suggest an

intention to transfer any and all interests related to a given asset. As previously mentioned, the

relevant “asset” referenced in the 1997 Agreement is listed under the asset name “Silent Partner

Inc” and is listed as having a book value of $ 264,436.53.4

        As the district court noted, the agreement between the FDIC and Reliant does not

expressly limit itself to the promissory note, nor does it contain an express reservation of the 1991

Judgment in favor of the FDIC. In the case of In re 24-52 44th Street, Long Island City, 26

N.Y.S. 2d 265 (N.Y. Sup. Ct. 1941), the assignees of a bond sought to collect from the bond’s

guarantors. The guarantors argued that when the bond had been assigned without an express

statement that the guarantee was included in the assignment, the bond became divested of the

guarantee. The court disagreed, noting that under New York law, the assignment of a principal

obligation generally carries with it all related rights, even those not referred to in the assignment.

The assignees’ argument was further strengthened by the fact that the assignor had not reserved

its rights against the guarantor.

        According to New York law, any act or words are sufficient to accomplish an assignment


        4
            We note that the book value of the asset is the same amount as the 1991 Judgment.

                                                  -8-
when the assignor is divested of all control and right to a cause of action and the assignee is

entitled to control it and receive its fruits. Miller, 540 F.2d at 557. We find that the 1997 transfer

documents are unambiguous and demonstrate a clear intent to divest the FDIC of any control or

rights related to the Silent Partner asset in favor of Reliant.

        Furthermore, because the FDIC’s intent, as made manifest by the contractual language,

was to transfer any and all interests related to SPI, the 1991 Judgment would seem to have

necessarily been included in the transfer. The FDIC clearly owned the 1991 Judgment at the time

of the transfer, and if, as seems clear by the contract’s terms, the FDIC intended to divest itself of

all control and interest in the right to its cause of action, then the assignment to Reliant was

proper and enforceable against the Zufles. See Miller, 540 F.2d at 557; Coffey v. Roe, 277 N.Y.S.

2d 743, 52 Misc. 2d 1003 (N.Y. Sup. Ct. 1967).

        Given the preceding discussion, we find that the 1997 transfer documents are

unambiguous and manifest an intent to assign all of the FDIC’s interests and rights related to the

SPI asset, including the right to enforce the 1991 Judgment, to Reliant. See Property Asset

Management, Inc., 173 F.3d at 87; In re 24-52 44th Street, 26 N.Y.S. 2d at 270.

We add that our decision is also consistent with the general trend in New York toward adopting

principles of free assignability of claims. Banque Arabe, 57 F.3d at 153.

        (3.) The 1998 Transaction. Appellants’ main contention, as previously noted, is that

Quantum could have, at best, purchased from Reliant only what Reliant had purchased from the

FDIC. Although we have rejected appellants’ argument that the only interest purchased by Reliant

was a promissory note, for the sake of clarity we turn, briefly, to examine the nature of the 1998

transfer between Reliant and Quantum.


                                                  -9-
       In their briefs, Appellants suggest that the 1998 transfer documents refer to a “judgment”

against SPI, which, according to appellants, never existed. While it is true, as far as this Court can

tell, that no judgment against SPI exists, any argument by Appellants that the transfer from

Reliant to Quantum did not entail the 1991 Judgment due to the language used in the 1998

transfer documents is without merit.

       According to the Bill of Sale and Assignment of Assets, the 1998 transaction assigned “all

of [Reliant’s] right, title and interest in and to each of the Assets identified on the computer disk

labeled Exhibit A.” The record includes a print out from the disk, which references an asset

labeled “Silent Partner, Inc.” The transfer balance is listed as $264,436.53, which is both the

amount of the 1991 Judgment as well as the value attributed to the asset referenced in the initial

transfer from the FDIC to Reliant. Furthermore, the print out lists the asset “type” as a

“judgment.” To suggest, as appellants appear to do, that this reference to a judgment in the exact

amount as the 1991 Judgment refers to some non-existent judgment against SPI is untenable

–particularly given our conclusion that the 1997 transaction included the 1991 Judgment.5

       (4.) Propriety of Affidavits Showing the Parties’ Intent. Appellants also argue that

affidavits from representatives of the FDIC and Quantum, which were submitted in an attempt to

clarify the parties’ “intent,” were improper, and should not have been relied upon by the district

court. See Allen v. West-Point Pepperwill, Inc., 933 F. Supp. 261 (S.D.N.Y. 1996), reversed on

other grounds, Krumme v. WestPoint Stevens, Inc., 238 F.3d 133 (2d Cir. 2000).


       5
         Although our determination regarding the intent of the parties to the 1997 transaction
was based on the language of the documents and New York law, we note, only in passing, that
use of the label “judgment” to refer to the asset in the 1998 transaction seems to strengthen the
appellee’s claim –and our conclusion– that the FDIC and Reliant understood the 1997 transaction
to include the 1991 Judgment.

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       According to appellants, because the transfer documents were unambiguous, no extrinsic

evidence should have been allowed to clarify the parties’ contractual intent. Because we have

determined that, standing alone, the transfer documents indicated intent to transfer the 1991

Judgment, a determination regarding the propriety of the affidavits is unnecessary. Furthermore, it

should be noted that the district court’s decision did not depend on said extrinsic evidence.

                                        III. CONCLUSION

       For the foregoing reasons, the decision of the district court rendering summary judgment

in favor of Quantum and reviving the 1991 Judgment as to Appellants Tim Tyler Zufle and Diane

Reed Zufle is AFFIRMED.




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