Burgess v. Bank of America, NA et al

Filing 30

ORDER DENYING 28 Motion for Reconsideration. Signed by Judge David A. Ezra. (aej)

UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF TEXAS
SAN ANTONIO DIVISION
JEANNE S. BURGESS,

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§
Plaintiff,
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§
vs.
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BANK OF AMERICA, N.A. and
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DEUTSCHE BANK NATIONAL
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TRUST COMPANY as Trustee of the §
New Century Home Equity Loan Trust, §
Series 2004-A,
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Defendants.
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No. SA:14–CV–495–DAE

ORDER DENYING PLAINTIFF’S MOTION FOR RECONSIDERATION
Before the Court is a Motion for Reconsideration of the Court’s Order
Granting Defendants’ Motion to Dismiss and Denying Plaintiff’s Motion for Leave
to File Supplemental Complaint filed by Plaintiff Jeanne Burgess (“Plaintiff”).
(Dkt. # 28.) Pursuant to Local Rule CV-7(h), the Court finds this matter suitable
for disposition without a hearing. After reviewing the Motion and the opposing
memorandum, for the reasons that follow, the Court DENIES Plaintiff’s Motion
for Reconsideration. (Dkt. # 28.)
BACKGROUND
On June 17, 2004, New Century Mortgage Corporation (“New
Century”) executed a home equity loan on 3142 Hidden Haven St., San Antonio,
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Texas 78261 (the “Property”), loaning Plaintiff an extension of credit in exchange
for a promise to pay $206,400.00 (the “Note”). (“Orig. Pet.,” Dkt. # 1, Ex. A-1
¶ 9.) The Note identified New Century Mortgage as Lender and was secured by a
Security Instrument executed by Plaintiff (“Deed of Trust”), granting the Trustee
power of sale in the Property. (Dkt. # 7, Ex. 1.)
Around March of 2007, Plaintiff suffered a “financial setback” and
requested loan assistance from Defendant Bank of America, N.A. (“BOA”). (Orig.
Pet. ¶ 11.) Plaintiff asserts that BOA instructed her that she could not make any
payments during the loan process and, although she reapplied numerous times,
BOA never sent her an approval or denial letter regarding the loan modification.
(Id. ¶ 12.) Plaintiff alleges that at some point, despite “BOA’s assurances to the
contrary, BOA proceeded on foreclosing on Plaintiff’s house.” (Id.)
On October 27, 2008, Plaintiff filed suit in the 37th Judicial Court of
Bexar County, Texas. On December 17, 2009, the state court entered a Final
Judgment, finding that Defendants had vested and quieted title to the Property, and
allowing Defendants to proceed with foreclosure. (Dkt. # 28 at 2.) On January 7,
2014, pursuant to the final judgment, Deutsche Bank sold the Property at auction.
(Id. at 3.)
On April 18, 2014, Plaintiff filed her Original Petition in the 288th
Judicial District Court of Bexar County, Texas, asserting causes of actions for
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breach of contract, anticipatory breach of contract, violations of the Federal Fair
Debt Collection Practices Act (“FDCPA”), violations of § 12 of the Texas Civil
Practice and Remedies Code, violations of the Texas Property Code, negligence
per se, gross negligence per se, unjust enrichment, wrongful foreclosure, wrongful
eviction, trespass to real property, and a request for declaratory judgment. (See
Orig. Pet.) Defendants removed the action to this Court on May 30, 2014. (Dkt.
# 1.)
On June 6, 2014, Defendants filed a Motion to Dismiss (Dkt. # 7), to
which Plaintiff did not respond. On September 10, 2014, Plaintiff filed a Motion
for Leave to File a Supplemental Complaint (Dkt. # 15), and on September 17,
2014, Defendants filed a Response (Dkt. # 16). On September 29, 2014, three days
before the Court was set to hear oral argument on Defendants’ Motion to Dismiss,
Plaintiff filed a Motion for Leave to File a Response to Defendants’ Motion to
Dismiss. (Dkt. # 18.) The Court denied the Motion, and on October 1, 2014,
Plaintiff filed a Motion for Reconsideration. (Dkt. # 20.) In her Proposed
Response to Defendants’ Motion to Dismiss, Plaintiff argued that the original Deed
of Trust and the original substitute trustee’s Deed provided an incorrect legal
description of the Property. Plaintiff asserted that those documents stated that the
Property began 2348.76 feet from the southwest corner when they should have
stated that it began 248.76 feet from the southwest corner. Plaintiff alleged that the
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error in the security instrument meant that the security instrument was invalid and
therefore that Defendants had no right to foreclose on the Property. (Dkt. # 18, Ex.
1.) The Court postponed the hearing and ordered Defendants to respond to
Plaintiff’s new arguments, (Dkt. # 22), and on October 8, 2014, Defendants filed a
supplemental memorandum in support of their Motion to Dismiss. (Dkt. # 23.)
On October 2, 2014, the Court heard oral argument on the Motion to
Dismiss. On October 27, 2014, the Court entered an Order Granting Defendants’
Motion to Dismiss and Denying Plaintiff’s Motion for Leave to File Supplemental
Complaint. (Dkt. # 26.) On November 24, 2014, Plaintiff filed the instant Motion
for Reconsideration (Dkt. # 28) and on November 26, 2014, Defendants filed an
Opposition to Plaintiff’s Motion. (Dkt. # 29.)
LEGAL STANDARD
“While the Federal Rules of Civil Procedure do not provide for a
motion for reconsideration, such a motion may be considered either a Rule 59(e)
motion to alter or amend judgment or a Rule 60(b) motion for relief from judgment
or order.” Shepherd v. Int’l Paper Co., 372 F.3d 326, 328 n.1 (5th Cir. 2004).
Whether a motion is considered under Rule 59(e) or Rule 60(b) depends on when it
was filed. See id. “If the motion is filed within 28 days of the judgment or order
of which the party complains, it is considered a Rule 59(e) motion.” Obersteller v.
United States, No. A–13–CV–198–LY, 2013 WL 7138802, at *1 (W.D. Tex. July
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19, 2013); see also Fed. R. Civ. P. 59(e). Here, Plaintiff filed her Motion on the
twenty-eighth day after the Court’s Order was entered. Therefore, the Court
considers the Motion under Rule 59. See Willis v. EAN Holdings, LLC, No. 3:12cv-00760-BAJ-RLB, 2014 WL 6087029, at *1 (M.D. La. Nov. 13, 2014) (treating
motion for reconsideration filed on the twenty-eighth day after the court’s order as
a motion made under Rule 59).
Federal Rule of Civil Procedure 59(e) permits a litigant to challenge
the correctness of a judgment. Three rationales can support a motion to alter or
amend under Rule 59(e): (1) the judgment exhibits either “a manifest error of law
or fact”; (2) the litigant wishes to present newly discovered evidence; or (3) “there
has been an intervening change in the controlling law.” Schiller v. Physicians Res.
Grp. Inc., 342 F.3d 563, 567 (5th Cir. 2003) (quoting Rosenzweig v. Azurix Corp.,
332 F.3d 854, 863–64 (5th Cir. 2003)). “‘Manifest error’ is one that ‘is plain and
indisputable, and that amounts to a complete disregard of the controlling law.’”
Guy v. Crown Equip. Corp., 394 F.3d 320, 325 (5th Cir. 2004). Accordingly, a
Rule 59(e) motion “is not the proper vehicle for rehashing evidence, legal theories,
or arguments that could have been offered or raised before the entry of judgment,”
and instead is an “extraordinary remedy that should be used sparingly.” Templet v.
HydroChem Inc., 367 F.3d 476, 479 (5th Cir. 2004).

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DISCUSSION
Plaintiff asks the Court to reconsider its holding that the correction
deed did not invalidate the foreclosure. (See Dkt. # 28.) In the Order Granting
Defendants’ Motion to Dismiss, the Court noted that under Texas law, “a
correction deed may be used to correct a defective description of a single property
when a deed recites inaccurate metes and bounds.” Myrad Props., Inc. v. LaSalle
Bank Nat’l Ass’n, 300 S.W.3d 746, 750 (Tex. 2009) (citing Doty v. Barnard, 47
S.W. 712, 713 (Tex. 1898)). Furthermore, a correction deed relates back to and
becomes effective as of the time of the instrument it purports to correct. Id. (citing
Wilson v. Dearing, Inc., 415 S.W.2d 475, 479 (Tex. App. 1967)). Thus, the Court
held that the correction deed purporting to correct the inaccurate recitation of
metes and bounds in the original Deed of Trust and the substitute trustee’s Deed
was valid and related back to when the originals were recorded. (Dkt. # 26 at 15–
16.)
In her Motion for Reconsideration, Plaintiff argues that the
foreclosure was void under the Texas Supreme Court’s holding in Myrad
Properties, Inc. v. LaSalle Bank National Association, 300 S.W.3d 746 (Tex.
2009), and Texas Property Code § 5.027(b). (Dkt. # 28 at 7.) Plaintiff claims that
because Deutsche Bank did not hold a valid security instrument, it did not have the
right to foreclose on the Property. (Id.) In Myrad, the Texas Supreme Court
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considered the question of whether a correction deed may convey two properties
when an unambiguous deed mistakenly conveys a single property. 300 S.W.3d at
748. The Supreme Court noted that under Texas law, parties may use correction
deeds in “limited circumstances,” including correcting an erroneous description of
a single property where the deed recites inaccurate metes and bounds. Id. at 750.
However, the Supreme Court further stated that “using a correction deed to convey
an additional, separate parcel of land is beyond the appropriate scope of a
correction deed.” Id. Thus, the Supreme Court held that a correction deed cannot
convey additional, separate properties not described in the original deed. Id.
As Defendants correctly point out, the issue in Myrad was different
from the issue presented in this case. Here, the original Deed had an inaccurate
description of the Property’s metes and bounds, which the correction deed
rectified. This is precisely the sort of permissible correction described by the
Supreme Court in Myrad. See 300 S.W.3d at 750. Thus, the Court finds that
Myrad does not compel a finding that the correction deed in this case was invalid.
Nevertheless, Plaintiff argues that if a deed of trust could be corrected after
foreclosure, then “anyone could foreclose using any legal description and then use
a correction [deed] to establish ownership of a different property.” (Dkt. # 28 at
5.) However, that is not what happened in this case. Here, the original Deed did
not describe a different property; it simply contains an extra digit in the metes and
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bounds description of the Property. The Deed and the correction deed do not
purport to convey different or separate properties, as prohibited by Myrad.
For the same reason, Plaintiff’s reliance on Texas Property Code
§ 5.027(b) is also misplaced. That section provides:
A correction instrument may not correct an ambiguity or error in a
recorded original instrument of conveyance to transfer real property or
an interest in real property not originally conveyed in the instrument
of conveyance for purposes of a sale of real property under a power of
sale under Chapter 51 unless the conveyance otherwise complies with
all requirements of Chapter 51.
Tex. Prop. Code § 5.027(b). Like the Myrad holding, this section simply confirms
that a correction deed may not transfer or convey interest in real property that is
separate and distinct from the property described in the original deed. Because the
correction deed and the original Deed in this case do not describe two different
properties, this section likewise does not invalidate the correction deed.
For these reasons, the Court finds that Plaintiff has not met her burden
of showing that the Court’s Order Granting Defendants’ Motion to Dismiss
exhibits a manifest error of law, and the Court DENIES Plaintiff’s Motion for
Reconsideration. The Court lastly notes that the title of Plaintiff’s Motion—
“Motion for Reconsideration of Order Granting Motion to Dismiss and Order
Denying Motion for Leave to File Supplemental Complaint”—suggests that
Plaintiff also asks the Court to reconsider the portion of its Order denying her
Motion for Leave to File a Supplemental Complaint. However, because Plaintiff
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has presented no argument as to that ruling, the Court declines to reconsider that
section of the Order.
CONCLUSION
For the reasons stated above, the Court hereby DENIES Plaintiff’s
Motion for Reconsideration. (Dkt. # 28.)
IT IS SO ORDERED.
DATED: San Antonio, Texas, May 7, 2015.

_____________________________________
David Alan Ezra
Senior United States Distict Judge

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