Clark v. Indy Mac Mortgage Services
MEMORANDUM OPINION. Signed by Judge Abdul K Kallon on 1/13/2014. (PSM)
2014 Jan-13 AM 10:31
U.S. DISTRICT COURT
N.D. OF ALABAMA
IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ALABAMA
INDY MAC MORTGAGE
SERVICES, a division of
OneWest Bank FSB,
Civil Action Number
Plaintiff Janice Clark (“Plaintiff”) filed this lawsuit, pursuant to Alabama
Code § 6-10-3, seeking to invalidate foreclosure proceedings executed on a
property that she claims was her homestead. Doc. 1. The mortgagee defendant
Indy Mac Mortgage Services, OneWest Bank (“OneWest Bank”) filed a motion for
summary judgment that is fully briefed and ripe for review. Docs. 15, 19, 20. In
light of Plaintiff’s failure to establish that the property in question was her actual
place of residence at the time of the execution of the mortgage, she is not entitled to
the protections of § 6-10-3, and summary judgment is due to be granted.
SUMMARY JUDGMENT STANDARD OF REVIEW
Under Rule 56(a) of the Federal Rules of Civil Procedure, summary
judgment is proper “if the pleadings, depositions, answers to interrogatories, and
admissions on file, together with the affidavits, if any, show that there is no
genuine issue as to any material fact and that the moving party is entitled to a
judgment as a matter of law.” Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986).
“Rule 56 mandates the entry of summary judgment, after adequate time for
discovery and upon motion, against a party who fails to make a showing sufficient
to establish the existence of an element essential to that party’s case, and on which
that party will bear the burden of proof at trial.” Id. The moving party bears the
initial burden of proving the absence of a genuine issue of material fact. Id. at 323.
The burden then shifts to the nonmoving party, who is required to “go beyond the
pleadings” to establish that there is a “genuine issue for trial.” Id. at 324 (citation
and internal quotation marks omitted). A dispute about a material fact is genuine
“if the evidence is such that a reasonable jury could return a verdict for the
nonmoving party.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986).
The court must construe the evidence and all reasonable inferences arising
from it in the light most favorable to the non-moving party. Adickes v. S. H. Kress
& Co., 398 U.S. 144, 157 (1970); see also Anderson, 477 U.S. at 255 (all justifiable
inferences must be drawn in the non-moving party’s favor). Any factual disputes
will be resolved in the non-moving party’s favor when sufficient competent
evidence supports the non-moving party’s version of the disputed facts. See Pace
v. Capobianco, 283 F.3d 1275, 1276, 1278 (11th Cir. 2002) (a court is not required
to resolve disputes in the non-moving party’s favor when that party’s version of
events is supported by insufficient evidence). However, “mere conclusions and
unsupported factual allegations are legally insufficient to defeat a summary
judgment motion.” Ellis v. England, 432 F.3d 1321, 1326 (11th Cir. 2005) (per
curiam) (citing Bald Mountain Park, Ltd. v. Oliver, 863 F.2d 1560, 1563 (11th Cir.
1989)). Moreover, “[a] mere ‘scintilla’ of evidence supporting the opposing party’s
position will not suffice; there must be enough of a showing that the jury could
reasonably find for that party.” Walker v. Darby, 911 F.2d 1573, 1577 (11th Cir.
1990) (citing Anderson, 477 U.S. at 251-52).
Alfred Clark, Jr. purchased and resided in a home on 14th Street in
Alabaster, Alabama (“the Property”). Doc. 16-3 at 10. In 1994, after Plaintiff and
Clark married, Plaintiff moved into the Property with Clark and stayed there until
1995 when she and Clark moved to Shelby, Alabama. Id. After Plaintiff and Clark
moved, Clark leased the Property to a tenant from July 1997 through June 1998.
Doc. 16-2 at 19. In March 1998, prior to the expiration of the lease, Clark
refinanced the mortgage on the Property through Standard Mortgage Corporation
of Georgia and Standard transferred the mortgage to OneWest Bank. Docs. 16-2 at
2, 12, 24. At the time Clark executed the mortgage, Plaintiff admitted that the
Property was not her homestead:
On March 12, 1998, [the Property] was not your principal residence?
At that time, it was not.
Okay. In fact, you lived [in Shelby, Alabama] on March 12th, 1998?
Would you dispute that on March 12th, 1998, the [P]roperty was not
No, I wouldn’t dispute it at that time.
Doc. 16-3 at 24, 28-29.
In August 2010, after a fifteen year absence, the Clarks moved back to the
Property with their son Brandon Callohan. Doc. 19-1 at 5. Subsequently, Clark
informed OneWest Bank that “it is our plan to have 100 14th St. SW [i.e. the
Property] as our primary home through the SAVE OUR HOME PROGRAM. The
payments can be made with our income from [our] Social Security check.” Doc.
19-1 at 15. OneWest Bank denied Clark’s application to its HopeNow program
because it determined that the Property was investment property. Doc. 19-1 at 13.
On December 3, 2010, Clark complained to OneWest Bank that the denial required
him to “start all over and prove to your department that I indeed live at 100 14th
Street. You all are now starting foreclosure on this home and I guess we will be
put on the streets.” Id. Later that month, Clark submitted a hardship affidavit to
OneWest Bank that stated that the Clarks were “moving from our primary home . . .
because of foreclose [sic]. We chose to return to 100 14th Street as our primary
home because of economic [sic] . . . .” Doc. 19-1 at 17 (emphasis added).
Presumably, OneWest Bank again declined the Clark’s hardship applications
because, after the Clarks defaulted on the mortgage, OneWest Bank foreclosed on
the Property and sold it at auction to the Federal National Mortgage Association
(“Fannie Mae”) on January 28, 2011. Doc. 16-2 at 25. Two weeks later, after
Clark refused to vacate the property in response to Fannie Mae’s demand for
possession, Fannie Mae filed an ejectment action in the Circuit Court of Shelby
County, Alabama against Plaintiff, Clark, and Callohan. Doc. 16-2 at 28-29.
When the Clarks and Callohan failed to respond after being “duly served,” the
court entered a default judgment, awarding Fannie Mae “immediate possession” of
the Property. Doc. 16-2 at 38-40, 42-43.1
A year later, Clark filed a declaratory judgment action in state court against
OneWest Bank alleging that it illegally foreclosed the Property in violation of the
Alabama Code § 6-10-3. Doc. 1-1 at 5, 6. OneWest Bank subsequently removed
this action to this court and moved for summary judgment. Docs. 1 and 15.
To receive protection under § 6-10-3, which states in relevant part that “[n]o
mortgage . . . of the homestead by a married person shall be valid without the
voluntary signature and assent of the husband or wife,” Plaintiff must establish that
the Property was her “actual place of residence.” James v. Thaggard, 795 So. 2d
738, 742 (Ala. 2001), citing Sims v. Cox, 611 So. 2d 339, 340 (Ala. 1992)
(emphasis added); see Worthington v. Palughi, 575 So. 2d 1092 (Ala. 1992);
Gowens v. Goss, 561 So. 2d 519 (1990). The court’s analysis focuses on the
Property’s homestead status at the time a mortgage is executed because § 6-10-3 is
“intended to protect . . . [a] spouse from a conveyance of the homeplace without [ ]
her consent.” James, 795 So. 2d at 742, citing Sims, 611 So. 2d at 341. The
Although Plaintiff alleges in her response to the movant’s undisputed facts that she
“contends that service was not proper and was not properly served on the Plaintiff on or about
March 5, 2011,” doc. 19 at 2, that issue is not before this court because it was not raised in the
burden is on the affected spouse to prove that § 6-10-3 is applicable, id., citing
Rhodes v. Schofield, 82 So. 2d 236 (Ala. 1955), and “a temporary absence from the
property will not be construed as an abandonment of the homestead exemption if
the spouse . . . intends to return to the property,” James, 795 So. 2d at 742 (citation
Based on the language of § 6-10-3, Plaintiff can invalidate the foreclosure
only if she can establish that Clark executed a mortgage in March 1998 on
Plaintiff’s homestead without her consent. Plaintiff cannot make this showing
because, as she correctly conceded, the Property was not her “actual place of
residence” at the time Clark executed the mortgage. James, 795 So. 2d at 742; doc.
16-3 at 24, 28-29. Indeed, as Plaintiff admits, Plaintiff and Clark lived in Shelby,
Alabama at the time, and Clark had leased the Property to a tenant. Docs. 16-2 at
19; 16-3 at 28-29. This lease agreement undermines any contention by Plaintiff
that the Property was her residence. To the contrary, the agreement demonstrated
that Plaintiff and Clark had no intention on establishing the Property as their
residence when Clark executed the mortgage. In fact, Clark acknowledged as such
when he admitted that he and Plaintiff were “moving from [their] primary home . . .
because of [a] foreclos[ure] . . . [and] chose to return to [the Property] . . . because
of economic [reasons] . . . .” Doc. 19-1 at 17. Unfortunately for Plaintiff, the
fourteen year hiatus (1995-2010) from living at the Property fails to qualify as a
“temporary absence,” and belies any contention that she did not abandon her
homestead exemption at the time of the mortgage in March 1998, or that she
intended to return to the Property. See James, 795 So. 2d at 742.
Ultimately, although it is clear that Plaintiff was in the process of
establishing the Property as her homestead when the foreclosure proceedings
commenced, this fact is insufficient to entitle Plaintiff to the protection of § 6-10-3.
Rather, because Clark properly executed the mortgage eleven years earlier against a
non-homestead, investment property, § 6-10-3 is inapplicable in this case.
Therefore, in light of Plaintiff’s failure to establish that the March 1998 mortgage
encumbered Plaintiff’s “actual” residence, the homestead protection rights in § 610-3 cannot serve to invalidate the foreclosure.2
Based on the foregoing, by separate order, the court will grant OneWest
Bank’s motion for summary judgment.
The court disagrees with OneWest Bank that it is due to prevail on res judicata. Fed.
Nat’l Mort. Assoc. v. Alfred Clark, Brandon Callohan, & Janice Clark, CV-2011-900136, doc.
15 at 10. Res judicata does not apply because the court decided the ejectment action by default,
rather than on the merits. See Kizzire v. Baptist Health Sys., Inc., 441 F.3d 1306, 1308 (11th Cir.
2006), citing Amey, Inc. v. Gulf Abstract & Title, Inc., 758 F.2d 1486, 1509 (11th Cir. 1985).
DONE this 13th day of January, 2014.
ABDUL K. KALLON
UNITED STATES DISTRICT JUDGE
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