B.J. Warren v. U.S. Bank, N.A., as Trustee for New Century Home Equity Loan Trust, Series 2001-NC2 Asset Backed Pass Through Certificates

COURT OF APPEALS
SECOND DISTRICT OF TEXAS
FORT WORTH
NO. 2-08-256-CV
B.J. WARREN APPELLANT
V.
U.S. BANK, N.A., AS TRUSTEE APPELLEE
FOR NEW CENTURY HOME EQUITY
LOAN TRUST, SERIES 2001-NC2
ASSET BACKED PASS THROUGH
CERTIFICATES
------------
FROM THE 17TH DISTRICT COURT OF TARRANT COUNTY
------------
MEMORANDUM OPINION 1
------------
Appellant B.J. Warren appeals from the trial court’s summary judgment
declaring that Appellee U.S. Bank, N.A., as Trustee for New Century Home
Equity Loan Trust, Series 2001-NC2 Asset Backed Pass Through Certificates,
1
… See Tex. R. App. P. 47.4.
held a valid lien on her property. Because we hold that U.S. Bank did not allege
any grounds in its motion for summary judgment, we reverse.
In 2000, Warren executed a note secured by a deed of trust in favor of
Bank of Desoto, N.A., to finance the purchase of property in Arlington, Texas.
On August 17, 2001, Warren refinanced the mortgage through the execution
of a note, secured by a deed of trust, in favor of New Century Mortgage
Corporation. When the escrow company sent the funds to Bank of Desoto to
pay off its note, that bank executed a release of lien for the deed of trust in its
favor; this release was filed in the county property records. The deed of trust
in favor of New Century, however, was not filed in the county property records.
New Century then purportedly assigned the note and deed of trust to U.S.
Bank.
In 2006, U.S. Bank accelerated Warren’s note and began the foreclosure
process. It then discovered that the original of the deed of trust had been lost
and that the deed of trust had never been filed in the county property records.
U.S. Bank brought suit against Warren, raising the following causes of
action: (1) declaratory judgment to establish its lien against the property; (2) in
the alternative, subrogation for the amount used to pay off the Bank of Desoto
note and to discharge Warren’s ad valorem taxes; (3) a judgment for foreclosure
2
and an order of sale; (4) nonjudicial foreclosure; (5) public auction; (6) quiet
title; and (7) writ of possession. Warren filed a general denial.
U.S. Bank then filed a motion for summary judgment. It stated that
“[t]his motion embraces all of [its] claims against [Warren],” but in fact the
motion only addressed its declaratory judgment action. U.S. Bank’s evidence
included, among other documents, a notarized copy of the New Century deed
of trust, a copy of the New Century note, and Bank of Desoto’s release of lien.
It also included the affidavit of Anna Jimenez-Reyes, a “foreclosure facilitator”
with Ocwen Loan Servicing, LLC, the servicer of Warren’s note. Jimenez-Reyes
states in her affidavit that the deed of trust had been assigned to U.S. Bank,
but she did not state that she had seen any assignment of the deed of trust or
even that such document existed in Ocwen’s files. The records attached to her
business records affidavit do not include a copy of the instrument assigning the
note and the deed of trust to U.S. Bank.
Warren did not respond to the motion. The trial court granted the
summary judgment and ordered that as of August 17, 2001, New Century was
the owner of a valid first lien on the property, that New Century had assigned
the deed of trust and note to U.S. Bank, and that U.S. Bank held a lien on the
property in the amount of $208,700. The judgment recited that “all relief not
expressly granted is denied” and that the judgment “finally disposes of all
3
parties and all claims and is appealable.”
The record on appeal does not show that U.S. Bank nonsuited or severed
its other claims against Warren. We note that because the trial court in its
order denied all relief not expressly granted and disposed of all claims and
parties, the court necessarily ruled on and denied U.S. Bank’s other pleaded
causes of action, including its claims of judicial foreclosure, nonjudicial
foreclosure, quiet title, and writ of possession.2 U.S. Bank did not file a cross-
appeal asserting error as to that part of the trial court’s judgment.
A plaintiff is entitled to summary judgment on a cause of action if it
conclusively proves all essential elements of the claim.3 When reviewing a
summary judgment, we take as true all evidence favorable to the nonmovant,
and we indulge every reasonable inference and resolve any doubts in the
nonmovant’s favor. 4
2
… See Lehmann v. Har-Con Corp., 39 S.W.3d 191, 206 (Tex. 2001)
(holding that granting more relief than movant is entitled to makes the order
reversible but not interlocutory and stating that language in judgment that
“[t]his judgment finally disposes of all parties and all claims and is appealable”
would leave no doubt of the trial court’s intention that order completely dispose
of entire case).
3
… See Tex. R. Civ. P. 166a(a), (c); MMP, Ltd. v. Jones, 710 S.W.2d 59,
60 (Tex. 1986).
4
… IHS Cedars Treatment Ctr. of DeSoto, Tex., Inc. v. Mason, 143
S.W.3d 794, 798 (Tex. 2004).
4
A summary judgment motion must “expressly present the grounds upon
which it is made,” 5 and summary judgment cannot be granted except on the
grounds expressly presented.6 The term “grounds” means “the reasons
entitling the movant to summary judgment.” 7 In determining whether grounds
are expressly presented, reliance may not be placed on briefs or summary
judgment evidence. 8 The purpose of this requirement is to provide the opposing
party with adequate information for opposing the motion and to define the
issues or points for the purpose of summary judgment.9
Generally, the nonmovant must expressly present to the trial court any
reasons for avoiding the movant’s right to summary judgment.10 No response
is necessary, however, when the movant’s summary judgment proof is legally
5
… McConnell v. Southside Indep. Sch. Dist., 858 S.W.2d 337, 341 (Tex.
1993).
6
… Johnson v. Brewer & Pritchard, P.C., 73 S.W.3d 193, 204 (Tex.
2002); Sci. Spectrum, Inc. v. Martinez, 941 S.W.2d 910, 912 (Tex. 1997).
7
… McConnell, 858 S.W.2d at 339 n.2.
8
… Id. at 341.
9
… Westchester Fire Ins. Co. v. Alvarez, 576 S.W.2d 771, 772 (Tex.
1978); overruled on other grounds by City of Houston v. Clear Creek Basin
Auth., 589 S.W.2d 671, 678 (Tex.1979); Camden Mach. & Tool, Inc. v.
Cascade Co., 870 S.W.2d 304, 309 (Tex. App.—Fort Worth 1993, no writ).
10
… McConnell, 858 S.W.2d at 343.
5
insufficient.11
On appeal, Warren brings a general issue contending that the trial court
erred by granting U.S. Bank’s summary judgment motion.12 In that issue, she
makes four arguments. In her first two arguments, she contends that the trial
court did not have jurisdiction because (1) there was no justiciable controversy
between Warren and U.S. Bank and (2) U.S. Bank failed to include all interested
parties. In her remaining arguments, she contends that U.S. Bank’s motion was
insufficient to entitle it to summary judgment because U.S. Bank (3) did not
meet its burden of proof and (4) failed to expressly present any grounds in its
motion. Although Warren did not respond to the summary judgment motion in
the trial court, she correctly argues that a party may challenge the sufficiency
of a summary judgment motion for the first time on appeal. 13
With respect to her second argument, Warren asserts that U.S. Bank
failed to add any other interested parties to its action; she does not, however,
inform this court who U.S. Bank failed to join. The Supreme Court of Texas
has held that the absence of interested parties does not necessarily deprive a
11
… Rhone-Poulenc, Inc. v. Steel, 997 S.W.2d 217, 223 (Tex. 1999); City
of Houston v. Clear Creek Basin Auth., 589 S.W.2d 671, 678 (Tex. 1979).
12
… See Malooly Bros. v. Napier, 461 S.W.2d 119, 121 (Tex. 1970).
13
… Clear Creek Basin Auth., 589 S.W.2d at 678.
6
trial court of jurisdiction to enter a declaratory judgment as to parties who are
before the court, although a court may be without jurisdiction to enter a
declaratory judgment with respect to non-joined interested parties.14
Furthermore, Warren did not make this argument in the trial court. Because she
did not raise this argument in the trial court, she failed to preserve error.15
Additionally, she has not shown that error, if any, is fundamental. 16
Accordingly, we do not consider this argument.
In her first and fourth arguments, Warren contends that there was no
justiciable controversy between Warren and U.S. Bank and that U.S. Bank failed
to present any grounds in its motion. These arguments are related and we
consider them together.
A trial court should enter a declaratory judgment “only if a justiciable
controversy exists as to the rights and status of the parties and the controversy
will be resolved by the declaration sought.” 17 A justiciable controversy is ”’a
real and substantial controversy involving genuine conflict of tangible interests
14
… Brooks v. Northglen Ass’n, 141 S.W.3d 158, 162–63 (Tex. 2004).
15
… See id.; Tex. R. App. P. 33.1(a).
16
… See Brooks, 141 S.W.3d at 163.
17
… Bonham State Bank v. Beadle, 907 S.W.2d 465, 467 (Tex. 1995).
7
and not merely a theoretical dispute.’” 18
We agree with Warren that U.S. Bank did not specify in its motion a
reason why it was entitled to summary judgment. The motion correctly stated
that a declaratory judgment action is only available where there is a justiciable
controversy, but it failed to specify any justiciable controversy existing in this
case. The motion stated only that (1) it was undisputed that Warren bought
the property at a real estate sale and that there was a subsequent refinance
loan transaction between Warren and New Century; (2) due to clerical error and
through no fault of Warren, New Century, or U.S. Bank, the deed of trust with
New Century was not filed in the property records; (3) U.S. Bank was the
current holder of the note and the deed of trust; and (4) U.S. Bank was entitled
to a declaratory judgment determining the rights of the parties to the
transaction and establishing the deed of trust in the amount of $208,700 as a
lien on the property in force as of the date of the deed of trust’s execution.
Although the original deed of trust has been lost, U.S. Bank still retains
a notarized copy. U.S. Bank did not allege that there was any dispute as to
whether it was the beneficiary of the deed of trust or as to the validity of the
18
… Id. (quoting Bexar-Medina-Atascosa Counties Water Control &
Improvement Dist. No. 1 v. Medina Lake Protection Ass’n, 640 S.W.2d 778,
779–80 (Tex. App.—San Antonio 1982, writ ref’d n.r.e.)).
8
instrument, and it failed to allege or demonstrate that the declaration it asked
for would resolve any dispute. It did not, for example, argue that it could
neither record its interest nor take any action against the property with only a
notarized copy of the deed of trust, or that Warren disputed that U.S. Bank held
any interest in the property. Because it failed to allege any grounds for
summary judgment on its declaratory judgment action, its motion was
insufficient as a matter of law and the trial court erred by granting the summary
judgment.19
Because we have held that the trial court erred by granting summary
judgment, we do not reach Warren’s remaining argument. 20
Having sustained Warren’s issue, we reverse the judgment of the trial
court and remand this case for further proceedings.
LEE ANN DAUPHINOT
JUSTICE
PANEL: DAUPHINOT, GARDNER, and MEIER, JJ.
DELIVERED: February 26, 2009
19
… See McConnell, 858 S.W.2d at 341.
20
… See Tex. R. App. 47.1.
9