Dena Alfayyad v. U.S. Bank National Association as Trustee for RASC 2007KS3 ( 2014 )

Pursuant to Ind.Appellate Rule 65(D),
this Memorandum Decision shall not
be regarded as precedent or cited
before any court except for the purpose
of establishing the defense of res
judicata, collateral estoppel, or the law Jun 13 2014, 10:02 am
of the case.
ATTORNEY FOR APPELLANT: ATTORNEYS FOR APPELLEE:
ZACHARY J. STOCK JAMES M. BOYERS
Carmel, Indiana LEAH B. SILVERTHORN
Wooden & McLaughlin, LLP
Indianapolis, Indiana
IN THE
COURT OF APPEALS OF INDIANA
DENA ALFAYYAD, )
)
Appellant-Defendant, )
)
vs. ) No. 29A02-1307-MF-652
)
U.S. BANK NATIONAL ASSOCIATION )
AS TRUSTEE FOR RASC 2007KS3, )
)
Appellee-Plaintiff. )
APPEAL FROM THE HAMILTON SUPERIOR COURT
The Honorable Daniel J. Pfleging, Judge
Cause No. 29D02-0904-MF-535
June 13, 2014
MEMORANDUM DECISION – NOT FOR PUBLICATION
BARNES, Judge
Case Summary
Dena Alfayyad appeals the trial court’s grant of summary judgment in favor of
U.S. Bank National Association as Trustee for RASC 2007KS3 (“U.S. Bank”) in its
foreclosure action. We affirm.
Issue
Dena Alfayyad raises one issue, which we restate as whether summary judgment
was proper because U.S. Bank established it was a person entitled to enforce the note.
Facts
In 2006, Alfayyad executed a promissory note in favor of Homecomings
Financial, LLC, (“Homecomings”) for $259,000 to purchase property in Carmel. The
note was secured by a mortgage. Alfayyad stopped making payments on the note in
2009.
On April 17, 2009, U.S. Bank filed a foreclosure action against Alfayyad. U.S.
Bank alleged that it “is ‘a person entitled to enforce’ the promissory note pursuant to IC
§26-1-3.1-301 and is entitled to enforce the mortgage as is evidenced by the chain of
assignments . . . .” App. p. 11. U.S. Bank attached to the complaint a copy of the note
and an assignment of the mortgage from Homecomings to U.S. Bank dated April 7, 2009.
On March 5, 2012, U.S. Bank filed a motion for summary judgment and decree of
foreclosure. U.S. Bank also moved for default judgment, which the trial court granted
and then set aside. On May 24, 2012, Alfayyad filed an answer to U.S. Bank’s complaint
and raised affirmative defenses and counterclaims. On September 4, 2012, Alfayyad
filed a response to the motion for summary judgment. U.S. Bank then replied. After a
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hearing on the motion, Alfayyad was given permission to respond to U.S. Bank’s reply,
and both parties were permitted to file post-hearing briefs. On May 31, 2013, the trial
court granted U.S. Bank’s motion for summary judgment and issued a decree of
foreclosure. Alfayyad filed a motion to correct error, which the trial court denied.
Alfayyad now appeals.1
Analysis
Alfayyad argues that the trial court improperly granted summary judgment. “We
review an appeal of a trial court’s ruling on a motion for summary judgment using the
same standard applicable to the trial court.” Perdue v. Gargano, 964 N.E.2d 825, 831
(Ind. 2012). “Therefore, summary judgment is appropriate only if the designated
evidence reveals ‘no genuine issue as to any material fact and that the moving party is
entitled to a judgment as a matter of law.’” Id. (quoting Ind. Trial Rule 56(C)). Our
review of summary judgment is limited to evidence designated to the trial court. Id.
(citing T.R. 56(H)). All facts and reasonable inferences drawn from the evidence
designated by the parties is construed in a light most favorable to the non-moving party,
and we do not defer to the trial court’s legal determinations. Id.
Alfayyad asserts that summary judgment was improper because there are genuine
issues of material fact as to whether U.S. Bank was entitled to enforce the note at the time
the complaint was filed. Indiana Code Section 26-1-3.1-301 provides:
1
The trial court’s summary judgment order is silent regarding Alfayyad’s counterclaims. In her motion
to correct error, Alfayyad asked the trial court to clarify its summary judgment order, and the trial court
denied that motion. Our decision today is limited to the propriety of summary judgment on the claims
raised in U.S. Bank’s complaint.
3
“Person entitled to enforce” an instrument means:
(1) the holder of the instrument;
(2) a nonholder in possession of the instrument who
has the rights of a holder; or
(3) a person not in possession of the instrument who is
entitled to enforce the instrument under IC 26-1-3.1-
309 or IC 26-1-3.1-418(d).
A person may be a person entitled to enforce the instrument
even though the person is not the owner of the instrument or
is in wrongful possession of the instrument.
In its complaint, U.S. Bank asserted it was entitled to enforce the note pursuant to
Indiana Code Section 26-1-3.1-301. In its motion for summary judgment, U.S. Bank
specifically asserted it was entitled to enforce the note as the holder of the note. U.S.
Bank designated a copy of the note, mortgage, assignment of mortgage, and the affidavit
of DeAndra Curry, the authorized officer for GMAC Mortgage, LLC, the servicer for
U.S. Bank. Curry stated that U.S. Bank “is the holder of the promissory note[.]” App. p.
56. Accordingly, U.S. Bank made a prima facie showing that it was entitled to enforce
the note pursuant to Indiana Code Section 26-1-3.1-301(1), and the burden shifted to
Alfayyad to designate specific facts establishing a genuine issue for trial. See Bushong v.
Williamson, 790 N.E.2d 467, 474 (Ind. 2003) (“Once the moving party has sustained its
initial burden of proving the absence of a genuine issue of material fact and the
appropriateness of judgment as a matter of law, the party opposing summary judgment
must respond by designating specific facts establishing a genuine issue for trial.”).
4
In response, Alfayyad asserted that U.S. Bank “cannot demonstrate its right to a
mortgage interest in the subject property.” App. p. 93. Alfayyad initially did not
designate evidence to support this claim, and later submitted her own affidavit in which
she stated U.S. Bank “does not allege it is in possession of the original note, and therefore
Affiant does not know for certain who to pay, as she does not know who is the proper
holder of the note.” Id. at 112. This was insufficient to create a genuine issue of material
fact for trial because U.S. Bank did designate evidence showing that it was the holder of
the note. Even if Alfayyad’s affidavit did create an issue of fact, U.S. Bank replied and
designated evidence that the original note had been delivered to its attorney and that the
note had been formally endorsed to be paid to U.S. Bank after the filing of the complaint.
This evidence established as a matter of law that U.S. Bank was entitled to enforce the
note.
Alfayyad contends, however, that U.S. Bank is not entitled to summary judgment
because it did not specify in its complaint that it was entitled to enforce the note as the
holder of the note and was not an assignee when the complaint was filed. In support of
this argument, Alfayyad relies on Wells Fargo Bank, N.A. v. Marchione, 69 A.D.3d 204,
207, 887 (N.Y. App. Div. 2009), in which the court affirmed the granting of a motion to
dismiss where a bank lacked standing to bring the foreclosure action because it was not
the assignee of the mortgage on the day the action was commenced.2 Marchione,
2
The Marchione court appears to use the term “mortgage” to refer collectively to the promissory note
and mortgage. Here, there is no dispute that the mortgage had been assigned to U.S. Bank on April 7,
2009, ten days before it filed the complaint.
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however, is not on point because it does not address the provision of Indiana Code
Section 26-1-3.1-301(a), which allows the holder of an instrument to enforce it.3
Alfayyad also argues that a June 2009 letter stating that GMAC Mortgage was
servicing the account on behalf of Residential Funding Corp, which owned an interest in
the account, creates an inference that Residential Funding Corp was the holder of the note
when the action commenced. However, because this letter was not designated as
evidence in the summary judgment proceedings, it cannot be a basis for reversing the
grant of summary judgment on appeal.4 See T.R. 56(H) (“No judgment rendered on the
motion shall be reversed on the ground that there is a genuine issue of material fact unless
the material fact and the evidence relevant thereto shall have been specifically designated
to the trial court.”). Because there were no questions of fact regarding whether U.S.
Bank was entitled to enforce the note when it filed the complaint, Alfayyad has not
established that the trial court’s grant of summary judgment was improper.
Conclusion
Alfayyad has not established that there are genuine issues of material fact
regarding whether U.S. Bank was entitled to enforce the note. We affirm.
Affirmed.
BAKER, J., and CRONE, J., concur.
3
Alfayyad did not file a motion to dismiss or motion for more definite statement. Instead, she raised the
issue as an affirmative defense in her answer, which was filed more than three years after U.S. Bank filed
its complaint and after U.S. Bank moved for summary judgment. Thus, we cannot agree with her claim
that she “asserted from an early stage in the proceedings that U.S. Bank was not a party entitled to enforce
the note.” Appellant’s Br. p. 8.
4
This letter was attached to Alfayyad’s answer but neither the answer nor the letter itself was designated
as evidence in summary judgment proceedings.
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