United States District Court, N.D. Texas, Dallas Division
DENNIS H. BIRENBAUM, Appellant,
BANK OF AMERICA, Appellee.
MEMORANDUM OPINION AND ORDER
Lindsay United States District Judge
the court is Appellant Dennis H. Birenbaum's appeal of
the bankruptcy court's August26, 2014 Order Granting the
Defendant's Motion for Final Summary Judgment and
February 17, 2016 Amended Final Judgment in favor of Appellee
Bank of America ("BOA"). After careful
consideration of the briefs, the record on appeal, and the
applicable law, the court affirms the bankruptcy court's
August 26, 2014 Order Granting the Defendant's Motion for
Final Summary Judgment (App. 10-15) and February 17, 2016
Amended Final Judgment (App. 4-8), and dismisses with
prejudice this appeal.
Factual and Procedural Background
appeal arises from the bankruptcy court's entry of a
final amended judgment on February 17, 2016, against Chapter
7 bankruptcy debtor Dennis H. Birenbaum
("Appellant" or "Birenbaum"), in
Adversary Case No. 13-03129-HDH. Birenbaum initiated the
underlying adversary case against BOA seeking a declaratory
judgment regarding the validity of the lien held by BOA on
property located at 9410 Alva Court, Dallas, Texas 75220 (the
"Property") to secure a Note in the amount of $4,
297, 591.64 pursuant to a Deed of Trust signed by Birenbaum
and his wife Brenda Birenbaum on August 23, 2005, In his
Complaint, dated June 5, 2013, Appellant asserts that the
lien on the Property is "invalid and unenforceable under
the Texas Constitution [*]and other applicable laws"
the Note signed and made by Plaintiff is not the
"note" described or identified in the Deed of Trust
as evidencing the secured indebtedness. Defendant does not
possess and is not the holder of the "note"
described and identified in the Deed of Trust and therefore
Defendant does not possess any lien on the Subject Property
as security for the Note. The debt identified in the Deed of
Trust as the "secured indebtedness" is different
than the debt evidenced by the Note. There is no
"secured indebtedness" because the "Note"
and "Loan" described and defined in the Deed of
Trust do not exist.
 The Deed of Trust states on Page 3 that "This
Security Instrument secures to Lender (i) the repayment of
the Loan, and all renewals, extensions, and modifications of
the Note, and (ii) the performance of Borrower's
covenants and agreements under this Security Instrument and
the Note." The term "Loan" is defined in
Subsection (G), Page 2 as "the debt evidenced by the
Note, plus interest, any prepayment charges and late charges
due under the Note, and all sums due under this Security
Instrument plus interest." The term "Borrower"
is defined on Page 1, Subsection (B) of the Deed of Trust as
"Dennis H. Birenbaum and Brenda Birenbaum"
(Emphasis Added). Thus, the terms "Note" and
"Loan" both refer to a promissory note jointly made
by both Dennis H. Birenbaum and Brenda Birenbaum, who are the
parties identified as the "borrower" obligated to
Defendant within the defined term "Borrower" in the
Deed of Trust. However, there is no promissory note jointly
made by both Dennis H. Birenbaum and Brenda Birenbaum and
therefore, by the express and specific terms of the Deed of
Trust drafted and prepared by Defendant, the Note made and
Dated:ly by Dennis H. Birenbaum is not the "note"
identified in the Deed of Trust as evidencing the secured
indebtedness. Consequently, the Deed of Trust does not grant
or create any lien on the Subject Property and is invalid and
unenforceable under long-standing Texas law. Waites v
Osborne, 2 S.W.665, 667 (Tex. 1886) (holding that real
property could not be liable for payment of any debt other
than those specifically recited in deed containing
Compl. ¶¶ 10-12 (App. 70-71) (emphasis in
filed a counterclaim in the adversary proceeding seeking to
judicially foreclose on the Property and other relief. On
April 2, 2014, BOA moved for summary judgment, contending
that it possessed a valid lien on the Property, BOA asserted
that the addition of Birenbaum's wife as a
"Borrower" in the Deed of Trust did not render the
lien on the Property defective under Texas law. BOA,
therefore, argued that it was entitled to foreclose on the
lien, which was in default. The bankruptcy court agreed,
granted the summary judgment motion, and entered judgment in
favor of BOA. On appeal, Birenbaum raises the following
1. Did the Deed of Trust executed by Appellant grant Bank of
America, NA a lien on Appellant's residence located at
9410 Alva Court, Dallas, Dallas County, Texas
("Homestead Property") when the secured
indebtedness (as specifically and expressly defined in the
Deed of Trust) differs from the indebtedness actually held by
the beneficiary of the Deed of Trust?
2. Did the Bankruptcy Court en- by disregarding and failing
to apply long-standing Texas authorities such as Waites v
Osborne, 2 S.W. 665 (Tex. 1886), Bank of Woodson v
Hibbitts, 626 S.W.2d 133 (Tex. App. - Eastland 1981) ref
d n.r.e., and Kimberly Development Corp. v First State
Bank of Greens Bayou, 404 S.W.2d 631 (Tex. App. -
Houston 1966) ref d n.r.e. in deciding the issues presented
3. Did the Bankruptcy Court err by finding and concluding
that "[T]he Parties do not dispute that the Debtor
obtained a loan secured by the Property" when that was
the primary issue involved in the Adversary Proceeding and
there was no summary judgment evidence supporting such
finding or conclusion?
Appellant's Br. 2.
Standard of Review
bankruptcy appeal, the district court reviews a bankruptcy
court's findings of fact for clear error and its
conclusions of law de novo, In re Dennis, 330 F.3d
696, 701 (5th Cir. 2003). A bankruptcy court's findings
of fact are "clearly erroneous" only if, "on
the entire evidence, the court is left with the definite and
firm conviction that a mistake has been committed."
In re Duncan,562 F.3d 688, 694 (5th Cir. 2009)
(quoting/?! re Dennis, 330 F.3d at 701)). Ill.
Analysis Boiled down to its essence, Birenbaum's argument
to the bankruptcy court and this court is that the Note held
by BOA is not the "Note identified in the Deed of
Trust" because the Note held by BOA was not signed by
his former wife Brenda Birenbaum. Birenbaum contends that,
under Texas law, the lien granted under a deed of trust is
contractual in nature and arises from the parties'
contract, not by operation of law. Birenbaum asserts that the
Deed of Trust or contract at issue in this case
"identifies an entirely different promissory note (i.e.
a note made by both Birenbaum and his ex-wife, Brenda
Birenbaum) than that held by Bank of America (i.e. a note
made only by Birenbaum as the sole and only maker)."
Appellant's Br. 9. Based on Waites vOsborne, 2 S.W. 665 (Tex. 1886), Birenbaum contends
that only the debt specifically recited in a deed of trust
can support a lien. Birenbaum acknowledges that Texas law
applies but contends, based on Texas and North Carolina
authority, that inconsistencies in a note and deed of trust
regarding the description of the secured indebtedness, the
parties, or even a trustee's name will make a deed of
trust on a note unenforceable. Birenbaum contends that,