United States District Court, S.D. Texas, Houston Division
MEMORANDUM FINDINGS OF FACT AND CONCLUSIONS OF
Kenneth M. Hoyt United States District Judge.
the Court for trial without a jury is the plaintiffs',
Mark Anthony Fornesa (“Mark”) and Ricardo
Fornesa, Jr. (“Ricardo”), suit against the
defendant Fifth Third Mortgage, Co and Fifth Third Bank
(“Fifth Third”) that arises out of a home loan
obtained by Mark Anthony Fornesa and his wife Judy Thanh
Fornesa (“Judy”). The Court received the
testimony and documentary evidence presented by the parties
and determines that the plaintiffs' suit is unmeritorious
and should be dismissed, thereby permitting the defendant to
foreclose the mortgage.
facts supporting the Court's determination in this case
show that Mark and Judy obtained a loan from Fifth Third in
the amount of $107, 350 on or about February 17, 2010, to
secure a parcel of property located at 6427 Moreland Lane in
Rosenberg, Fort Bend County, Texas (“Rosenberg
Property”). Beginning in November 2014, Mark and Judy
ceased making payments on their loan and; thereafter, the
note went to default. Mark and Judy vacated the property in
December 2013, because it was not habitable. See
Memorandum Opinion, Bkcy. Cause 12-37238-H3-13, Findings of
the father of Mark, and Mark together entered into a document
entitled “Equality Sharing Agreement” dated
February 28, 2010. This agreement reflected funds allegedly
paid to Mark and Judy in order that they might meet their
closing costs or down payment obligations on the Rosenberg
property. The document purported to grant to Ricardo an
equitable share or ownership in the Rosenberg Property.
Neither Ricardo, Mark, Judy or Ricardo's wife, Cynthia,
informed Fifth Third of the Agreement and the funds allegedly
provided by Ricardo at the time of Mark and Judy's
purchase of the parcel, or at the time the loan was processed
in February 2010, or prior to Fifth Third's foreclosure.
Ricardo testified that he made monthly note payments for Mark
and Judy, and that after they moved out of the property, he
and his wife, Cynthia, moved in. However, neither Mark nor
Ricardo recorded the Agreement in the real estate records of
Fort Bend County, Texas. Nor did either of the parties
otherwise inform Fifth Third of the underlying transaction
and the use of the property.
September of 2012, Ricardo and Cynthia sought Chapter 13
Bankruptcy. This proceeding was his second filed bankruptcy.
A plan was confirmed on April 25, 2013. The previous filing
occurred in May of 2007. In his 2012 bankruptcy, Ricardo
failed to list Fifth Third as a creditor; therefore, Fifth
Third did not receive notice of the Mark/Ricardo Agreement.
While Ricardo listed the Agreement as an asset in the
personal property section, there was no indication that the
asset was secured by the Rosenberg Property. Subsequent
amendments by Ricardo to his bankruptcy schedules also failed
to properly disclose the alleged relationship.
February 28, 2013, the Equity Sharing Agreement expired by
its own terms. In the meantime, Ricardo and Cynthia began
occupying the property and made intermittent payments to
Fifth Third in behalf of Mark and Judy. A notice of default
and intent to accelerate dated March 15, 2015, was sent to
Mark and Judy at their last known address. However, they did
not respond and neither did Ricardo and Cynthia.
Subsequently, the loan was accelerated by Fifth Third an
April 6, 2015, notice. Ricardo forwarded a partial payment to
Fifth Third on May 1, 2015. That payment was promptly
returned, and Fifth Third foreclosed its lien on May 4, 2015.
evidence also shows that Mark and Judy executed a quit claim
deed in favor of Ricardo and Cynthia on January 28, 2015, and
recorded same in the real estate records of Fort Bend County,
Texas. This transaction constitutes a breach of the terms of
the promissory note that Mark and Judy executed in 2010.
Neither Mark nor Ricardo sought permission or consent for the
transfer of Mark and Judy's interest in the property from
Fifth Third in advance of the transfer. Therefore, the Court
HOLDS that the transfer is voided by Fifth Third's
foreclosure on May 4, 2015.
law applies to this action. Neither Mark nor Ricardo has
stated a valid common law cause of action for wrongful
foreclosure. See Sauceda v. GMAC Mortgage, 268
S.W.3d 135, 139 (Tex. App.-Corpus Christi 2008, no pet.)
Fifth Third's lien against the property is a superior
lien and, therefore, extinguishes any inferior claim(s)
also insists that the Emergency Economic Stabilization Act of
2008, is a bar to Fifth Third's foreclosure.
Ricardo's reliance is misplaced as Fifth Third is not a
designated entity under the Act. See 12 U.S.C.
§ 5201 et. seq. (2010). Therefore, this claim
Ricardo argues that Fifth Third's foreclosure violated
the automatic stay that he contends was in force as a result
of his 2012 bankruptcy proceeding. The evidence shows that
Ricardo did not seek bankruptcy protection as it relates to
the Rosenberg Property. See 11 U.S.C. §
362(a)(3). He made no reference to the property except as a
cash interest appears on his bankruptcy schedules and cannot
now point to a benefit that, if disclosed properly, would
have changed the course of the bankruptcy case. Such conduct
cannot and should not be tolerated. See In re
Clayton,235 B.R. 801, 806-07 (Bankr. M.D., N.C. 1998).
And, Mark and Judy did not seek § 362 protection.
Therefore, there is no ...