Bac Home Loans Servicing, L.P. v. Wedereit

In the Supreme Court of Georgia
Decided: June 15, 2015
S14G1862. BAC HOME LOANS SERVICING, L.P. f/k/a COUNTRYWIDE
HOME LOANS SERVICING v. WEDEREIT
MELTON, Justice.
Brian Wedereit sued BAC Home Loans Servicing, L.P. ("BAC”) for,
among other things, breach of contract and wrongful foreclosure. BAC moved
for summary judgment, and the trial court denied BAC’s motion on Wedereit’s
claims for wrongful foreclosure, equitable relief, punitive damages and attorney
fees. However, the trial court also granted sua sponte partial summary judgment
to Wedereit on his breach of contract claim because BAC allegedly failed to
give proper pre-acceleration notice as required under Paragraph 22 of the
Security Deed. BAC appealed, and, in Divsion 1 of its opinion, the Court of
Appeals affirmed the trial court’s sua sponte grant of partial summary judgment
to Wedereit. BAC Home Loans Servicing, L.P. v. Wedereit, 328 Ga. App. 566(1) (759 SE2d 867) (2014). We granted BAC’s petition for certiorari to
determine whether the Court of Appeals erred when it held in its Division 1 that
the issues resolved by the award to Wedereit of partial summary judgment were
the same as those raised by BAC’s motion for summary judgment, such that an
award of partial summary judgment sua sponte to a nonmovant was permissible.
See Covington v. Countryside Investment Co., Inc., 263 Ga. 125, 127 (3) (428
SE2d 562) (1993). For the reasons that follow, we reverse.
Under limited circumstances, a court may grant summary judgment sua
sponte in favor of a nonmoving party:
While in most cases it is better practice to await a motion for summary
judgment before entering it for a [nonmoving] party, it may not be
erroneous under the circumstances of a given case, where the issues are
the same as those involved in the movant's motion.
(Citation and punctuation omitted; emphasis in original) Covington, supra, 263
Ga. at 127 (3). In order to properly grant summary judgment sua sponte to a
nonmovant, it is not sufficient that the issues upon which the sua sponte grant
of summary judgment is based are merely similar or related to those raised in the
movant’s motion for summary judgment, or that they are issues that could have
otherwise become the subject of a proper motion for summary judgment because
they were raised in the pleadings. See id. at 127 (3) (where defendant only
moved for summary judgment on plaintiff’s specific performance and damages
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claims, trial court erred in granting summary judgment to defendant sua sponte
on its counterclaim for breach of contract). The issues must be identical to those
raised in the movant’s motion, such that it would render the nonmovant’s filing
of a separate motion for summary judgment on those same issues “a pure
formality.” Cruce v. Randall, 245 Ga. 669, 669-670 (266 SE2d 486) (1980)
(where “two plaintiffs were joint obligees on a promissory note on which the
defendants were the obligors, and [where] the issues concerning the defendants'
liability [were] identical as to both plaintiffs,” trial court properly granted
summary judgment sua sponte to nonmoving plaintiff where first plaintiff
prevailed on summary judgment). Additionally, the sua sponte “grant of
summary judgment must be proper in all other respects[, which] means that in
addition to ensuring the record supports such a judgment, the trial court must
ensure that the party against whom summary judgment is rendered is given full
and fair notice and opportunity to respond prior to entry of summary judgment.”
(Citations and punctuation omitted.) Aycock v. Calk, 222 Ga. App. 763, 764
(476 SE2d 274) (1996).
In Wedereit’s unverified Amended Complaint, he quoted the first section
of Paragraph 22 of the Security Deed, which states:
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Lender shall give notice to Borrower prior to acceleration following
Borrower's breach of any covenant or agreement in this Security
Instrument (but not prior to acceleration under Section 18 unless
Applicable Law provides otherwise). The notice shall specify: (a)
the default; (b) the action required to cure the default; (c) a date, not
less than 30 days from the date the notice is given to Borrower, by
which the default must be cured; and (d) that failure to cure the
default on or before the date specified in the notice may result in
acceleration of the sums secured by this Security Instrument and
sale of the Property. The notice shall further inform Borrower of the
right to reinstate after acceleration and the right to bring a court
action to assert the nonexistence of a default or any other defense
of Borrower to acceleration and sale. If the default is not cured on
or before the date specified in the notice, Lender at its option may
require immediate payment in full of all sums secured by this
Security Instrument without further demand and may invoke the
power of sale granted by Borrower and any other remedies
permitted by Applicable law. Borrower appoints Lender the agent
and attorney-in-fact for Borrower to exercise the power of sale.
Lender shall be entitled to collect all expenses incurred pursuing the
remedies provided in this Section 22, including, but not limited to,
reasonable attorneys’ fees and costs of title evidence.
Although Wedereit claimed that BAC had breached this paragraph of the
Security Deed, he did not allege how the breach occurred. He only stated that
BAC “failed to comply with the requirements of paragraph 22 of the Security
Deed as set forth above which thereby constitutes a breach of this agreement.”
BAC denied the allegations in the complaint, filed an affidavit as evidence of its
compliance with the terms of the Security Deed, submitted two letters as
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evidence of its alleged compliance with Paragraph 22, and moved for summary
judgment on the breach of contract claim. Wedereit, on the other hand,
submitted no evidence to affirmatively show that he could carry his burden of
proving the merits of his breach of contract claim. Nor did he further clarify that
the basis of his claim under Paragraph 22 could have related to alleged
deficiencies in the notices sent to him before BAC accelerated the loan.
While the case was in this posture, the trial court concluded that the notice
letters sent to Wedereit by BAC and contained in the summary judgment record
did not comply with the pre-acceleration requirements of Paragraph 22 and
denied BAC’s motion for summary judgment on Wedereit’s breach of contract
claim. As BAC concedes, this portion of the trial court’s ruling was correct,
because BAC failed to show that there was no evidence sufficient to create a
jury issue on at least one essential element of Wedereit’s breach of contract
claim. See Lau's Corp. v Haskins, 261 Ga. 491 (405 SE2d 474) (1991).
However, the trial court did not stop there. It then went on to grant summary
judgment sua sponte to Wedereit on this claim. This was error, because, as
explained more fully below, the fact that a defendant is not entitled to summary
judgment on a plaintiff’s breach of contract claim does not mean that the
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plaintiff is then automatically entitled to sua sponte summary judgment on that
claim.
As an initial matter, it must be said that, despite the fact Wedereit could
have raised the breach of contract issue more clearly in his complaint, the issue
of BAC’s compliance or lack thereof with respect to Paragraph 22 of the
security deed was in fact made a part of this case. Accordingly, BAC’s motion
for summary judgment on this issue did make it a proper one upon which a court
could grant sua sponte summary judgment under the appropriate circumstances.
The circumstances here, however, were not appropriate. As stated previously,
even where the same issues are involved with respect to a party’s motion for
summary judgment and the issues upon which a trial court chooses to grant
summary judgment sua sponte to a nonmoving party, the sua sponte “grant of
summary judgment must [also] be proper in all other respects[, which] means
that[, among other things, the court must] ensur[e] [that] the record supports
such a judgment.” (Emphasis supplied.) Aycock, supra, 222 Ga. App. at 764.
Summary judgment was not appropriate for Wedereit here, because the record
simply does not support such a judgment in his favor.
This result is made clear by examining the respective burdens at the
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summary judgment stage for defendants and plaintiffs. For purposes of summary
judgment, a defendant does not need to disprove every aspect of a plaintiff’s
case, but may prevail
by showing the court that the documents, affidavits, depositions and
other evidence in the record reveal that there is no evidence
sufficient to create a jury issue on at least one essential element of
plaintiff's case. If there is no evidence sufficient to create a genuine
issue as to any essential element of plaintiff's claim, that claim
tumbles like a house of cards. . . . A defendant who will not bear the
burden of proof at trial need not affirmatively disprove the
nonmoving party’s case; instead, the burden on the moving party
may be discharged by pointing out by reference to the affidavits,
depositions and other documents in the record that there is an
absence of evidence to support the nonmoving party's case. If the
moving party discharges this burden, the nonmoving party cannot
rest on its pleadings, but rather must point to specific evidence
giving rise to a triable issue.
(Emphasis supplied.) Lau's Corp., supra, 261Ga. at 491. A plaintiff, on the other
hand, “must demonstrate that there is no genuine issue of material fact [as to
every element of his or her claims] and that the undisputed facts, viewed in the
light most favorable to the [defendant], require judgment [in the plaintiff’s
favor] as a matter of law.” Id. See also OCGA § 9-11-56 (c). These burdens are
completely different, as it cannot be said that, where a defendant is unable to
show that “there is no evidence sufficient to create a jury issue on at least one
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essential element of [a] plaintiff's case,” a plaintiff has automatically carried his
or her burden of proving every element of his or her case such that he or she is
entitled to judgment as a matter of law. In this sense, a defendant’s inability to
show at the summary judgment stage that a plaintiff cannot prevail as a matter
of law has nothing to do with a plaintiff’s entirely separate burden of showing
that he or she is entitled to prevail as a matter of law.
In light of these completely different burdens at the summary judgment
stage, the most that can be said with respect to BAC’s failed motion for
summary judgment is that issues of fact remain with respect to Wedereit’s
breach of contract claim against it, not that Wedereit has met his own burden of
proving his breach of contract claim. This is especially true where, as here,
Wedereit pointed to no evidence to support his breach of contract claim,
whether produced by him or by BAC. To hold otherwise would impermissibly
shift to BAC the burden of “affirmatively disprov[ing] the nonmoving party's
case” (see Lau's Corp., supra), rather than leave the burden where it belongs,
with Wedereit, to prove his case. Worse still, BAC’s failure to meet this
impermissibly shifted burden resulted in Wedereit being improperly awarded
summary judgment automatically without pointing to any evidence to support
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his claim. Smith v. Atl. Mut. Cos., 283 Ga. App. 349, 351 (641 SE2d 586)
(2007) (In order for a plaintiff to be awarded summary judgment, “[i]t is
incumbent upon [that] plaintiff to prove its case and, until it does, a defendant
is under no obligation to disprove it”).1
Here, Wedereit’s filing of his own separate motion for summary judgment
would not have been a “mere formality,” (see Cruce, supra), but would have
been a necessary step for Wedereit to take towards meeting his own burden of
proving that he was entitled to judgment as a matter of law. Because the record
does not support the conclusion that Wedereit carried his burden of proving that
he was entitled to summary judgment as a matter of law on his breach of
contract claim, the trial court erred in awarding summary judgment sua sponte
to Wedereit. We must therefore reverse the Court of Appeals’ decision to uphold
the trial court’s ruling.
Judgment reversed. All the Justices concur.
1
It is worth noting here that the fact that a moving party has failed to
prevail at the summary judgment stage does not necessarily mean that the party
will not later be able to prevail at trial.
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