SunTrust Mortgage Incorporated v. Donald Busby, Jr.
Filing
UNPUBLISHED PER CURIAM OPINION filed. Originating case number: 2:09-cv-00003-MR-DLH Copies to all parties and the district court/agency. [998812466].. [11-1469]
Appeal: 11-1469
Document: 48
Date Filed: 03/19/2012
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UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
No. 11-1469
SUNTRUST MORTGAGE INCORPORATED,
Plaintiff – Appellee,
v.
DONALD D. BUSBY, JR.; ROBERT G. RONK; KENNARD DAVIS,
Defendants – Appellants,
and
LORI A. NASSIDA; KELLY M. BAKER; MICHAEL T. BAKER; ROBERT
JOHN CUPELLI; LEIGH K. CUPELLI; DEANNA DAVIS; DEAN R.
CUMMINGS; JEFFREY A. SYKES; GUY BARMOHA; GREGORY M.
SCHUETZ; NATALIE BOUTROS; PAUL MULA,
Defendants.
Appeal from the United States District Court for the Western
District of North Carolina, at Bryson City.
Martin K.
Reidinger, District Judge. (2:09-cv-00003-MR-DLH)
Submitted:
January 30, 2012
Decided:
March 19, 2012
Before MOTZ, DAVIS, and WYNN, Circuit Judges.
Affirmed by unpublished per curiam opinion.
Michael G. Wimer, WIMER & ASSOCIATES, P.C., Asheville, North
Carolina, for Appellants. Robert D. Perrow, J.B. McGuire Boyd,
WILLIAMS MULLEN, P.C., Richmond, Virginia; Elizabeth C. Stone,
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WILLIAMS MULLEN, P.C., Raleigh, North Carolina, for Appellee.
Unpublished opinions are not binding precedent in this circuit.
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PER CURIAM:
Defendants-Appellants Donald D. Busby, Robert G. Ronk,
and Kennard Davis (hereinafter “Appellants”) appeal the district
court’s
order
granting
Plaintiff-Appellee
“SunTrust”)
in
summary
SunTrust
SunTrust’s
judgment
Mortgage,
action
to
in
Inc.
recover
favor
of
(hereinafter
a
deficiency
judgment on promissory notes following foreclosure by power of
sale on Appellants’ properties.
Appellants
claim
Finding no error, we affirm.
that
the
district
court
erred
in
finding Appellants’ equitable defenses barred by res judicata
because they were not raised in a proceeding under N.C. Gen.
Stat.
§ 45-21.34
(2006).
The
district
court
held
that
Appellants’ defenses challenged the validity of the debt and
default,
which
a
North
Carolina
superior
court
had
already
determined to be valid during a hearing to confirm the power of
sale foreclosure pursuant to N.C. Gen. Stat. § 45-21.16 (2006).
The court further held that, while Appellants could not have
raised these equitable defenses in the hearing under § 45-21.16,
they could have raised their equitable defenses in a proceeding
to
enjoin
(2006).
resulted
the
The
in
foreclosure
court
the
under
concluded
rights
of
N.C.
that
the
Gen.
their
parties
Stat.
failure
to
the
§ 45-21.34
to
do
so
foreclosure
becoming “fixed” and therefore barred Appellants from raising
such an equitable challenge in a later proceeding in a different
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forum.
Date Filed: 03/19/2012
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The court also noted that its holding was in accord with
cases from the Eastern and Middle Districts of North Carolina.
See
Merrill
Lynch
Bus.
Fin.
Servs.,
Inc. v.
Cobb,
No.
5:07-cv-129D, 2008 WL 6155804, at *3-4 (E.D.N.C. Mar. 18, 2008);
Brumby, Jr. v. Deutsche Bank Nat'l Trust Co., No. 1:09CV144,
2010
WL
3219353
magistrate
judge’s
(M.D.N.C.
report
and
Aug. 13,
2010)
recommendation,
(adopting
2010
WL
the
617368
(M.D.N.C. Feb. 17, 2010)).
We
find
persuasive.
the
district
court’s
reasoning
to
be
The doctrine of res judicata applies “not only to
the points upon which the court was required by the parties to
form an opinion and pronounce a judgment, but to every point
which properly belonged to the subject in litigation and which
the
parties,
brought
[e]xercising
forward
at
the
reasonable
time
and
diligence,
determined
might
have
respecting
it.”
Painter v. Wake Cnty. Bd. of Educ., 217 S.E.2d 650, 655 (N.C.
1975).
Both § 45-21.16 and § 45-21.34 are parts of a coherent
statutory framework intended to preserve the limited rights of a
mortgagor subject to a power of sale foreclosure.
See, e.g., In
re Foreclosure of Deed of Trust by Goforth Props., Inc., 432
S.E.2d 855, 858-59 (N.C. 1995); In re Helms, 284 S.E.2d 553, 555
(N.C. Ct. App. 1981); see also Turner v. Blackburn, 389 F. Supp.
1250,
1258
(W.D.N.C.
1975).
To
permit
challenges
to
the
validity of the default outside this framework would defeat the
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legislative intent behind the North Carolina statutory scheme.
Despite the unique timing of this case, we are not persuaded
that Appellants were effectively barred from filing an action
pursuant
to
§ 45-21.34.
district
court
did
not
Accordingly,
err
in
we
finding
conclude
that
Appellants’
the
defenses
barred by the doctrine of res judicata.
Because we find Appellants’ equitable arguments to be
properly barred by res judicata, we find no merit in Appellants’
contention that a genuine issue of material fact existed with
respect to Appellants’ “quasi-estoppel” argument.
find
that
the
district
court
did
not
err
We further
in
holding
that
Appellants’ challenge to the materiality of the default should
have been raised in the § 45-21.16 proceeding and therefore also
is barred by res judicata.
Appellants also argue that the district court erred in
finding that they had not forecast competent evidence to support
a claim to offset SunTrust’s deficiency judgment.
cited by Appellants are distinguishable.
Both cases
See First Citizens
Bank & Trust Co. v. Cannon, 530 S.E.2d 581, 583 (N.C. Ct. App.
2000); Queen v. Queen, No. COA07-1207, 2008 N.C. App. LEXIS 638,
at *5-6 (N.C. Ct. App. Mar. 19, 2008).
Thus, we find that the
district court did not err in determining that tax valuations do
not,
by
themselves,
provide
establish market value.
competent
evidence
sufficient
to
See Star Mfg. v. Atl. Coast Line R.
5
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Date Filed: 03/19/2012
Co., 23 S.E.2d 32, 36 (N.C. 1942).
Page: 6 of 6
We also conclude that the
district court did not err in determining that the county tax
assessor’s testimony did not provide additional support for the
tax valuation evidence and that his testimony as to valuation
was therefore inadmissible.
Accordingly, we affirm the judgment of the district
court.
legal
before
We dispense with oral argument because the facts and
contentions
the
court
are
adequately
and
argument
presented
would
not
in
aid
the
the
materials
decisional
process.
AFFIRMED
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