Deutsche Bank National Trust Company v. Laura A. Suarez

Filing 41

ORDER GRANTING re 36 MOTION for Summary Judgment filed by Deutsche Bank National Trust Company, It is further ORDERED that Plaintiff is authorized to foreclose on the property that secures the Note. There are no more claims pending in this case. The Court will enter a separate final judgment consistent with this Order. Signed by Judge Xavier Rodriguez. (wg)

UNITED STATES DISTRICT COURT FOR THE
WESTERN DISTRICT OF TEXAS
SAN ANTONIO DIVISION

DEUTSCHE BANK NATIONAL TRUST
COMPANY,
Plaintiff,
v.
LAURA A. SUAREZ,
Defendant.

'
'
'
'
'
'
'
'
'
'
'
'
'

Civil Action No. SA-14-CV-1106-XR

ORDER
On this date, the Court considered the status of the above captioned case and its pending
motion. After careful consideration, the Court GRANTS Plaintiff’s Motion for Summary
Judgment. Docket no. 36.
I.

Background
Plaintiff filed this case on December 18, 2014, seeking a declaratory judgment to
foreclose on real property. Docket no. 1. Plaintiff alleges it is entitled to judicial foreclosure
because Defendant Laura A. Suarez did not comply with the Loan Agreement with respect to the
real property and improvements known as 1115 Walkers Way, San Antonio, Texas, 78216 (“the
Property”). Id.
On or about December 20, 2005, Defendant allegedly executed a Texas Home Equity
Note (“Note”) in the principal amount of $243,200.00 originally payable to Lifetime Financial
Services, LLC d/b/a Town & Country Mortgage Services (“Lifetime Financial”). Id. at 3. An

Allonge to Note was executed along with the Note, making the Note payable without recourse to
Option One Mortgage Corporation (“Option One”). Id. Concurrently with the execution of the
1

Note, Defendant also executed a Texas Home Equity Security Instrument (“Security
Instrument”). Id. at 4. The Security Instrument grants Lifetime Financial, its successors, and
assigns a security interest in the Property. Id.
Plaintiff alleges that Defendant defaulted on the Loan Agreement. Id. Plaintiff alleges the
Loan Agreement is due for the February 1, 2013, payment and all subsequent monthly payments.
Id. Plaintiff states it mailed a notice of default and request to cure to Defendant in accordance
with the Loan Agreement and the Texas Property Code. Id. Defendant allegedly did not cure the
default, and the maturity of the debt was accelerated. Id.
Plaintiff brought this action to obtain an order for foreclosure. Id. Plaintiff alleges it is the
current legal owner and holder of the Note and the mortgagee of record who has the right to
enforce the Note and Security Instrument. Id. Plaintiff alleges it has fully performed its
obligations under the Loan Agreement, but that Defendant did not comply when she failed to
substantially perform material obligations required under its terms, including the payment of
amounts due under the contract. Id. Plaintiff also seeks judgment for the reasonable attorneys’
fees as provided by the Security Instrument. Id. at 5.
On June 16, 2016, the parties filed an Agreed Report on Alternative Dispute Resolution
indicating their desire to negotiate a settlement. Docket no. 23. After the parties filed a Joint
Motion for Stay on September 6, 2016, Docket no. 26, the Court granted the motion and
administratively closed the case. Docket no. 27. On April 10, 2017, Plaintiff filed its Motion to
Reinstate, indicating that the parties had not reached a settlement agreement. Docket no. 30. The
Court lifted the stay and reinstated the case on April 18, 2017. Docket no. 31. Now before the
Court is Plaintiff’s Motion for Summary Judgment. Docket no. 36.

2

II.

Standard of Review
The court shall grant summary judgment if the movant shows that there is no genuine
dispute as to any material fact and the movant is entitled to judgment as a matter of law. FED. R.
CIV. P. 56(a). To establish that there is no genuine issue as to any material fact, the movant must
either submit evidence that negates the existence of some material element of the non-moving
party’s claim or defense, or, if the crucial issue is one for which the non-moving party will bear
the burden of proof at trial, merely point out that the evidence in the record is insufficient to
support an essential element of the non-movant’s claim or defense. Lavespere v. Niagra Machine
& Tool Works, Inc., 910 F.2d 167, 178 (5th Cir. 1990). Once the movant carries its initial
burden, the burden shifts to the non-movant to show that summary judgment is inappropriate.
See Fields v. City of S. Hous., 922 F.2d 1183, 1187 (5th Cir. 1991).
In order for a court to conclude that there are no genuine issues of material fact, the court
must be satisfied that no reasonable trier of fact could have found for the non-movant, or, in
other words, that the evidence favoring the non-movant is insufficient to enable a reasonable jury
to return a verdict for the non-movant. See Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 250
n.4 (1986). In making this determination, the court should review all the evidence in the record,
giving credence to the evidence favoring the non-movant as well as the “evidence supporting the

moving party that is uncontradicted and unimpeached, at least to the extent that evidence comes
from disinterested witnesses.” Reeves v. Sanderson Plumbing Prods., Inc., 530 U.S. 133, 151
(2000). The Court reviews all facts in the light most favorable to the non-moving party. First
Colony Life Ins. Co. v. Sanford, 555 F.3d 177, 181 (5th Cir. 2009). A motion for summary
judgment cannot be granted simply because there is no opposition. Ford–Evans v. Smith, 206
Fed. App’x 332, 334 (5th Cir. 2006).

3

III.

Analysis
Plaintiff alleges it is entitled to an order allowing foreclosure because the summary
judgment evidence conclusively shows the existence of a debt, the debt is secured by a lien, a
default by Defendant, and that there was proper service of a notice of default and acceleration.

Docket no. 36 at 6. Plaintiff also alleges the summary judgment evidence conclusively
establishes Plaintiff, as the holder of the Note, is entitled to proceed with foreclosure under the
Loan Agreement and the Texas Property Code. Id. In the alternative, Plaintiff alleges the
summary judgment evidence conclusively establishes Plaintiff, as the assignee of the Note, is
entitled to proceed with foreclosure. Id.
1. Plaintiff’s claim that there was a debt secured by a lien on which Defendant
defaulted and for which there was proper service.
A party pursuing judicial foreclosure must demonstrate that “(1) a debt exists; (2) the
debt is secured by a lien created under Article 16, § 50(a)(6) of the Texas Constitution; (3) the
borrowers are in default under the note and security instrument; and (4) the borrowers received
actual notice of default and acceleration.” Marshall v. Deutsche Bank Nat’l Trust Co., No. SA13-CV-937-OLG, slip op. at 14–15 (W.D. Tex. Sept. 21 2014) (citing Huston v. U.S. Bank Nat.
Ass’n, 988 F. Supp. 2d 732, 740 (S.D. Tex. 2013), aff’d, 583 F. App’x 306 (5th Cir. 2014)).
Plaintiff meets its summary judgment burden to show that a debt exists, the debt is
properly secured by a lien, and that Defendant is in default. Plaintiff shows that a debt exists with
the Loan Agreement in the amount of $243,200.00, Docket no. 1-1 at 2, and that the debt is
secured by a lien properly created under the Texas Constitution with the Security Instrument. Id.
at 8. Plaintiff shows that Defendant defaulted on the loan after Defendant failed to make her
February 1, 2013, payment and that through July 31, 2017, Defendant owes $334,137.03 on the
Loan Agreement. Docket 36-1 at 4, 56. The Note states that Defendant will be in default if she
4

fails to pay the full amount of each monthly payment when it is due. Id. at 8. Defendant does not
dispute these facts.
Plaintiff also meets its summary judgment burden to show that Defendant was properly
served regarding default and acceleration. Under Texas Law, a mortgage servicer “shall serve a
debtor in default under a deed of trust . . . with written notice by certified mail stating that the
debtor is in default under the deed of trust . . . and giv[e] the debtor at least 20 days to cure the
default” before giving notice of a foreclosure sale. Deweese v. Ocwen Loan Servicing L.L.C.,
2014 WL 6998063, at *4 (Tex. App.—Houston [1st Dist.] 2014, no pet.); see TEX. PROP. CODE
§ 51.002(d). Service of a notice by certified mail is complete “when the notice is deposited in the
United States mail, postage prepaid and addressed to the debtor at the debtor's last known
address. The affidavit of a person knowledgeable of the facts to the effect that service was
completed is prima facie evidence of service.” TEX. PROP. CODE § 51.002(e). Plaintiff shows that
on April 19, 2013, through its mortgage servicer Ocwen Loan Servicing, LLC (“Ocwen”),
Plaintiff sent Defendant a Notice of Default that indicated its intent to accelerate. Docket 36-1 at
4, 41–42. Plaintiff provides evidence that on February 24, 2014, Ocwen sent Defendant a Notice
of Acceleration of Loan Maturity after Defendant failed to pay the amount due. Id. at 4, 49.
Defendant does not dispute these facts.
In sum, Plaintiff has met its summary judgment burden to show judicial foreclosure is
appropriate. There is no genuine issue of material fact as to whether a debt exists, the debt is
properly secured by a lien, Defendant is in default of that debt, and Defendant received proper
notice of default and acceleration.

5

2. Plaintiff’s claim that it is the holder of the Note and entitled to proceed with
foreclosure.
Under the Texas Property Code, a party has standing to initiate a foreclosure sale if the
party is a mortgagee. TEX. PROP. CODE §§ 51.002, 51.0025. A mortgagee includes the grantee,
beneficiary, owner, or holder of a security instrument, such as a deed of trust, or “if the security
interest has been assigned of record, the last person to whom the security interest has been
assigned of record.” Id. § 51.0001(4). A mortgagee and its mortgage servicer have the authority
to exercise the power of sale through its authority to appoint a substitute trustee. Id. § 51.0075.
Plaintiff argues it has the authority to foreclose on the property because it is the holder of
the Note and beneficiary of the Deed of Trust. When a mortgage note is transferred, the
mortgage or deed of trust is also transferred to the holder of the note because of the common law
rule that the mortgage follows the note. J.W.D., Inc. v. Federal Ins. Co., 806 S.W.2d 327, 329–
30 (Tex. App.—Austin 1991, no writ) (mortgage on real estate is said to “follow” promissory
note it secures); see also Campbell v. Mortgage Elec. Registration Sys., Inc., 2012 WL 1839357,
at *4 (Tex. App.—Austin 2012, pet. denied).
Plaintiff provides a copy of the Note, which indicates that Lifetime Financial was the
initial lender. Docket no. 36-1 at 7. Plaintiff also shows that the Note was granted, sold, assigned,
transferred, and conveyed by Lifetime Financial to Option One. Id. at 11. Plaintiff also provides
evidence that the Note was granted, sold, assigned, transferred, and conveyed by Option One to
Plaintiff. Id. at 3, 33. Plaintiff further shows that the assignment to Plaintiff is reflected in the
blank endorsement on the Allonge to Note. Id. at 11. Plaintiff shows that it is in physical
possession of the Note through Ocwen. Id. at 3.
Defendant argues that there are no valid assignments of record that show the transfer of
the security interest to grant Plaintiff the power to foreclose. Defendant also argues that
6

Plaintiff’s evidence that the Note was endorsed in blank is insufficient to show Plaintiff has the
power to foreclose.
Plaintiff meets its summary judgment burden to show that it has the power to foreclose.
Plaintiff offers as evidence the Note itself and affidavits related to that Note, and Defendant
offers no evidence that the documents submitted by Plaintiff were falsified or fraudulent. The
evidence shows that the Note was endorsed in blank and that Plaintiff is in possession of the
Note. Defendant offers no evidence disputing this fact. Under Texas law, Plaintiff is entitled to
proceed with foreclosure as the holder of the Note. Kiggundu v. Mortgage Elec. Registration Sys.
Inc., 469 F. App’x. 330, 331 (5th Cir. 2012); see Lawson v. Gibbs, 591 S.W.2d 292, 294 (Tex.
Civ. App.—Houston [14th Dist.] 1979, writ ref’d n.r.e.); see also United States v. Vahlco Corp.,
720 F.2d 885, 891 (5th Cir. 1983). There is no genuine issue of material fact as to whether
Plaintiff is a mortgagee under Texas law as the holder of the Note and entitled to foreclosure.
The Court need not consider Plaintiff’s claim that it is the legal assignee of the Note.
CONCLUSION
The Court hereby GRANTS Plaintiff’s Motion for Summary Judgment. Docket no. 36. It
is further ORDERED that Plaintiff is authorized to foreclose on the property that secures the
Note, to wit:
BEING LOT 52, BLOCK 2, NCB 17160, WALKER RANCH, UNIT 1,
PLANNED UNIT DEVELOPMENT, CITY OF SAN ANTONIO, BEXAR
COUNTY, TEXAS, ACCORDING TO PLAT RECORDED IN VOLUME 9547,
PAGES 203-205, DEED AND PLAT RECORDS, BEXAR COUNTY, TEXAS,
and which has the address of 1115 Walkers Way, San Antonio, Texas 78216, pursuant to the
Security Instrument and Texas Property Code § 51.002.
Plaintiff is awarded its costs of court, and should it wish to pursue such costs, a bill of
costs must be filed within fourteen days of the entry of judgment pursuant to Local Rule CV–54.
7

There are no more claims pending in this case. The Court will enter a separate final judgment
consistent with this Order.
It is so ORDERED.
SIGNED this 3rd day of October, 2017.

_________________________________
XAVIER RODRIGUEZ
UNITED STATES DISTRICT JUDGE

8