Roland Flores v. BAC Home Loans Servicing, LP, Its Successors, Assigns, and Predecessors in Interest

Fourth Court of Appeals
San Antonio, Texas
MEMORANDUM OPINION
No. 04-12-00598-CV
Roland FLORES,
Appellant
v.
BAC HOME LOANS SERVICING, L.P., and Its Successors, Assigns, and Predecessors in
BAC HOME LOANS SERVICING, L.P. and
Its Successors, Assigns, and Predecessors in Interest,
Appellees
From the 37th Judicial District Court, Bexar County, Texas
Trial Court No. 2011-CI-09313
Honorable Solomon Casseb, III, Judge Presiding
Opinion by: Marialyn Barnard, Justice
Sitting: Sandee Bryan Marion, Justice
Marialyn Barnard, Justice
Luz Elena D. Chapa, Justice
Delivered and Filed: August 21, 2013
AFFIRMED
Roland Flores filed suit against appellee BAC Home Loans Servicing, L.P. and Its
Successors, Assigns, and Predecessors in Interest (“BAC”), challenging BAC’s nonjudicial
foreclosure of his home. Flores asserted BAC had no authority to foreclose on his home because
it did not own or legally hold the note or deed of trust. BAC filed traditional and no evidence
motions for summary judgment, which the trial court granted. We affirm the trial court’s
judgment.
04-12-00598-CV
BACKGROUND
In 1993, Roland Flores and his wife executed a $77,400.00 promissory note to refinance
their home. The note was payable to America’s Wholesale Lender and specifically provided it
could be transferred. The note was secured by a deed of trust, which named America’s Wholesale
Lender and its successors and assigns as beneficiaries. In 2003, the note and deed of trust were
assigned to Countrywide Home Loans, Inc., which thereafter assigned the note and deed of trust
to Countrywide Home Loans Servicing, L.P. in 2008. In 2009, according to BAC, Countrywide
Home Loans Servicing, L.P. and all other Countrywide entities merged with Bank of America. As
a result of the merger, BAC, a Bank of America entity, became the owner and holder of the Flores
note and deed of trust.
Flores continued to make payments on the note for some time. However, by September 1,
2006, Flores had become delinquent. Flores made the last payment on April 22, 2010, which paid
the note through April 2010.
Based on Flores’s failure to make the required note payments, BAC began the nonjudicial
foreclosure process, sending notice to Flores of the substitute trustee’s sale, which was to be
conducted on June 7, 2011. Flores filed suit to prevent the foreclosure and sale. In his live petition,
Flores asked the trial court to declare BAC lacked any interest in the property so as to entitle it to
foreclose, and he sought damages for BAC’s alleged filing of a fraudulent document (the
foreclosure notice) in violation of Chapter 12 of the Texas Civil Practice and Remedies Code. 1
1
Although it does not appear in the clerk’s record, both parties seem to agree this matter was tried on the claims set
forth in Flores’s first amended petition. A copy of this petition, which is not file-stamped is attached to BAC’s brief.
We must then determine whether the issues contained in the first amended petition were tried by consent. Unpled
claims may be tried by consent of the parties in a summary judgment context. Via Net v. TIG Ins. Co., 211 S.W.3d
310, 313 (Tex. 2006) (holding issues in summary judgment may be tried by consent); Roark v. Stallworth Oil & Gas,
Inc., 813 S.W.2d 492, 495 (Tex. 1991) (finding “it would advance no compelling interest of the parties or our legal
system to reverse a summary judgment simply because of a pleading defect” when parties allow issues to be tried by
consent). For an issue to be tried by consent, it must be absent from the pleadings and be knowingly developed as an
issue in the case by both parties. TEX. R. CIV. P. 67; Case Corp. v. Hi-Class Bus. Sys. of Am., Inc., 184 S.W.3d 760,
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BAC filed traditional and no evidence motions for summary judgment, which the trial court
granted. Flores then perfected this appeal.
ANALYSIS
On appeal, Flores contends the trial court erred in granting summary judgment in favor of
BAC. Before we begin our substantive analysis, we note that Flores and BAC speak of BAC’s
interest in the Flores property, or lack thereof, in terms of “standing” or “capacity.” We hold
neither of these legal terms are applicable with regard to the issues in this case.
Standing focuses on who may bring an action. In re Guardianship of Archer, 203 S.W.3d
16, 23 (Tex. App.—San Antonio 2006, pet. denied) (citing M.D. Anderson Cancer Ctr. v. Novak,
52 S.W.3d 704, 708 (Tex. 2001)). A challenge to standing suggests there is no real controversy
between the parties or the judicial action sought will not resolve the parties’ issues. Austin Nursing
Ctr. v. Lovato, 171 S.W.3d 845, 849 (Tex. 2005). Capacity, on the other hand, involves a party’s
legal ability to pursue a claim. Id. A challenge to a party’s capacity suggests the party does not
have the legal status or ability to be sued or to sue, e.g., a minor or one who is incompetent. Id.
“[C]apacity ‘is conceived of as a procedural issue dealing with the personal qualifications of a
party to litigate.’” Spurgeon v. Coan & Elliott, 180 S.W.3d 593, 597 (Tex. App.—Eastland 2005,
no pet.) (quoting 6A Charles Alan Wright, Arthur R. Miller, and Mary Kay Kane, Wright, Miller
& Kane, FEDERAL PRACTICE AND PROCEDURE: CIVIL 2D § 1559, at 441 (2d ed.1990)). In sum, “[a]
plaintiff has standing when it is personally aggrieved, regardless of whether it is acting with legal
authority; a party has capacity when it has the legal authority to act, regardless of whether it has a
771 (Tex. App.—Dallas 2005, pet. denied). Although the first amended petition was apparently never filed with the
clerk’s office, BAC’s motions for summary judgment are responsive to that petition and the claims therein, which
differ from the original petition, as is Flores’s response to the motions. Clearly, the parties developed the issues as set
forth in the first amended petition, and we therefore hold the issues presented in Flores’s first amended petition were
tried by consent of the parties.
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justiciable interest in the controversy.” Nootsie, Ltd. v. Williamson Cnty. Appraisal Dist., 925
S.W.2d 659, 661 (Tex. 1996) (emphasis in original).
BAC’s standing is not at issue here because BAC did not bring this suit; it sought a
nonjudicial foreclosure. Flores sued BAC. Moreover, there is an obvious controversy between
the parties that can be resolved through the current proceedings: whether BAC was the owner and
holder of the note and deed of trust as a successor-in-interest to Countrywide Financial, Inc.
Likewise, capacity is not an issue in this suit. Flores does not challenge BAC’s ability to
be sued, i.e., he does not suggest BAC is not a legal entity. A true challenge to BAC’s capacity
would mean BAC was not an entity that could sue or be sued. This has never been Flores’s
contention.
Although neither legal concept is applicable, we construe Flores’s pleadings and his
arguments on appeal as a challenge to BAC’s authority to foreclose based on its alleged failure to
own or legally hold the note and the deed of trust. Similarly, we construe BAC’s contention that
there is no evidence it lacked capacity to enforce the indebtedness as an allegation that there is no
evidence BAC lacked authority, as the owner and holder of the note and deed of trust, to foreclose.
Standard of Review
A party may file a traditional motion for summary judgment, a no evidence motion for
summary judgment, or both. Binur v. Jacobo, 135 S.W.3d 646, 650 (Tex. 2004); Strandberg v.
Spectrum Office Bldg., 293 S.W.3d 736, 738 (Tex. App.—San Antonio 2009, no pet.). We review
de novo a trial court’s order granting either a traditional or no evidence motion for summary
judgment. See Valence Operating Co. v. Dorsett, 164 S.W.3d 656, 661 (Tex. 2005); Strandberg,
293 S.W.3d at 738. When a party files both a traditional and a no evidence summary judgment
motion, we review the no evidence motion first. Ford Motor Co. v. Ridgeway, 135 S.W.3d 598,
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600 (Tex. 2004). If we find the trial court properly granted the no evidence motion, we need not
review the traditional motion. Id.
A no evidence motion for summary judgment under Rule 166a(i) of the Texas Rules of
Civil Procedure is, in essence, a pretrial motion for directed verdict. See TEX. R. CIV. P. 166a(i);
Timpte Indus., Inc. v. Gish, 286 S.W.3d 306, 310 (Tex. 2009). After an adequate time for
discovery, a party without the burden of proof may, without presenting evidence, seek summary
judgment on the ground there is no evidence to support one or more essential elements of the
nonmovant’s claim or defense. TEX. R. CIV. P. 166a(i); All Am. Tel., Inc. v. USLD Commc’ns,
291 S.W.3d 518, 526 (Tex. App.—Fort Worth 2009, pet. denied). The motion must specifically
state the element or elements for which there is no evidence. TEX. R. CIV. P. 166a(i); Timpte
Indus., Inc., 286 S.W.3d at 310; All Am. Tel, Inc., 291 S.W.3d at 526. The trial court must grant
the motion unless the nonmovant produces more than a scintilla of summary judgment evidence
that raises a genuine issue of material fact. TEX. R. CIV. P. 166a(i). More than a scintilla of
evidence exists when the evidence “rises to a level that would enable reasonable and fair-minded
people to differ in their conclusions.” Merrell Dow Pharms., Inc. v. Havner, 953 S.W.2d 706, 711
(Tex. 1997).
A traditional motion for summary judgment is granted only when the movant establishes
there are no genuine issues of material fact, and the movant is entitled to judgment as a matter of
law. Lesieur v. Fryar, 325 S.W.3d 242, 246 (Tex. App.—San Antonio 2010, pet. denied) (citing
Browning v. Prostok, 165 S.W.3d 336, 244 (Tex. 2005)). On review, we take evidence favorable
to the nonmovant as true and indulge every reasonable inference from the evidence in its favor.
Lesieur, 325 S.W.3d at 246 (citing Am. Tobacco Co. v. Grinnell, 951 S.W.2d 420, 425 (Tex.
1997)). In deciding whether there is a material fact issue precluding summary judgment, all
conflicts in the evidence are disregarded and evidence favorable to the nonmovant is accepted as
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true. Cole v. Johnson, 157 S.W.3d 856, 859 (Tex. App.—Fort Worth 2005, no pet.) (citing Harwell
v. State Farm Mut. Auto. Ins. Co., 896 S.W.2d 170, 173 (Tex. 1995)).
BAC’s Right to Foreclose
In its no-evidence motion for summary judgment, BAC asserted there is no evidence it
lacked authority to foreclose, i.e., to enforce Flores’s indebtedness. Accordingly, it was incumbent
upon Flores to produce more than a scintilla of evidence to show BAC lacked such authority. We
have reviewed Flores’s summary judgment evidence and hold he has not produced any evidence
to show BAC lacked authority to foreclose.
Flores argues BAC never acquired ownership of the note or the deed of trust because there
was no assignment, transfer, or merger to establish the acquisition. However, given the no
evidence motion filed by BAC, Flores needed to produce more than a scintilla of evidence showing
there was no assignment, transfer, or merger between the Countrywide Financial, Inc. entities and
Bank of America. Flores’s only summary judgment evidence in this regard comes in paragraph
three of his affidavit which states:
I have not received any documentation to [sic] Countrywide Home Loan Servicing
ever transferred or assigned my mortgage to Bank of America NA. I have not been
provided with any transfer, deed, assignment or document of any kind that
identifies for me the basis for Bank of America to claim right to collect and/or
foreclose upon my real property. Given these facts, I cannot agree that this
defendant has any rights or standing to demand enforcement of my mortgage with
their bank.
Taking Flores’s evidence as true, his averment merely establishes he was unaware of any
transfer, assignment, or merger between Countrywide Home Loans Servicing, L.P. and Bank of
America and its entities. This evidence does not establish that an assignment, transfer, or merger
never occurred or BAC lacked such authority. Rather, it serves only as evidence that Flores had
no knowledge of any such event.
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Accordingly, we hold the trial court did not err in granting BAC’s no evidence motion with
regard to Flores’s challenge to its authority to foreclose. Flores did not produce even a scintilla of
evidence to suggest BAC lacked the right or authority to recover on Flores’s indebtedness by way
of a nonjudicial foreclosure.
Violation of Chapter 12 of the Texas Civil Practice & Remedies Code
Flores also alleges BAC violated Chapter 12 of the Civil Practice and Remedies Code when
it filed the foreclosure notice with the Bexar County Clerk’s Office. To recover under this Chapter,
the plaintiff must show: “(1) the defendant made, presented, or used a document with knowledge
that it was a fraudulent lien, (2) the defendant intended that the document be given legal effect,
and (3) the defendant intended to cause the plaintiff physical injury, financial injury, or mental
anguish.” Merritt v. Davis, 331 S.W.3d 857, 860–61 (Tex. App.—Dallas 2011, pet. denied); see
TEX. CIV. PRAC. & REM. CODE ANN. § 12.002(a) (West Supp. 2012). In its no evidence motion
for summary judgment, BAC alleged there was no evidence of any of the statutorily required
elements. We agree.
Flores has failed to produce even a scintilla of evidence that BAC acted fraudulently in
pursuing the foreclosure. See Havner, 953 S.W.2d at 711. In an attempt to raise a fact issue,
Flores produced three pieces of summary judgment evidence: (1) a copy of the assignment from
America’s Wholesale Lender to Countrywide Home Loans, Inc., (2) a copy of the assignment from
Countrywide Home Loans, Inc. to Countrywide Home Loans Servicing, L.P., and (3) his affidavit.
Nothing in any of these documents addresses the elements of the statute upon which BAC based
its no evidence motion. As discussed in the previous issue, there is no evidence BAC lacked
authority to seek to recover under the note and deed of trust. Per force, there is no evidence of
attempting to foreclose on a fraudulent lien in an effort to damage Flores. Accordingly, because
Flores has failed to produce any evidence relating to the elements of section 12.002(a), we hold
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the trial court did not err in granting BAC’s no evidence motion for summary judgment as to this
claim.
CONCLUSION
Based on the foregoing, we overrule Flores’s issues and affirm the trial court’s grant of
summary judgment in favor of BAC.
Marialyn Barnard, Justice
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