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Johnson v. Nationstar Mortgage, LLC

United States District Court, S.D. Texas, Houston Division

March 31, 2017

BEVERLY JOHNSON, et al., Plaintiffs,
v.
NATIONSTAR MORTGAGE, LLC, et al., Defendants.

          MEMORANDUM OPINION AND ORDER

          KENNETH M. HOYT, UNITED STATES DISTRICT JUDGE

         I. INTRODUCTION

         This case arises out of the alleged wrongful foreclosure of the plaintiff's real property located in Fort Bend County, Texas. Pending before the Court is the defendants', Nationstar Mortgage, LLC (“Nationstar”) and U.S. Bank, National Association, as Successor Trustee to Wachovia Bank, N.A., as Trustee for the Holders of the MASTR Alternative Loan Trust 2003-7 (the “Trustee”), (collectively, the “defendants”), motion for summary judgment (Dkt. No. 8). The plaintiffs, Beverly Johnson and Aaron Dale Johnson (the “plaintiffs”), have filed a response in opposition to the motion (Dkt. No. 9) and the defendants have filed a reply in support of their motion for summary judgment as well as a motion for leave to file additional evidence, which this Court granted on September 13, 2016.[1] (See Dkt. Nos. 11 & 15). After having carefully considered the motions, response, reply, the record and the applicable law, the Court determines that the defendants' motion for summary judgment should be GRANTED.

         II. FACTUAL BACKGROUND AND PROCEDURAL OVERVIEW

         On August 28, 2003, the plaintiffs purchased the real property located at 2911 Taylors Glen Ct., Katy, Texas 77494 (the “Property”). The Property's purchase was financed by a loan from Countrywide Home Loans, Inc. (“Countrywide”) comprised of a Note in the principle amount of $349, 750.00 (the “Note”) payable to Countrywide. Simultaneously with the execution of the Note, the plaintiffs executed a Deed of Trust, conveying a security interest in the Property to Countrywide. The Deed of Trust expressly authorizes Mortgage Electronic Registration Systems, Inc. (“MERS”), to act as the beneficiary, solely as a nominee for Countrywide, its successors, and assigns. The Note and Deed of Trust were subsequently recorded in the Fort Bend County Property Records on July 19, 2004.

         Sometime in 2009, the plaintiffs defaulted on their obligations under the Note and Deed of Trust and attempted to remedy their default by tendering less than the total amount due and owing. Their offer, however, was refused and the plaintiffs made no further payments thereafter. On August 7, 2009, the defendants, through their foreclosure counsel, notified the plaintiffs of their intent to accelerate the loan, setting the Property for a foreclosure sale on September 11, 2009.

         On November 28, 2011, Countrywide assigned its interests in the Deed of Trust to Bank of America, N.A., Successor by Merger to BAC Home Loans Servicing LP f/k/a Countrywide Home Loans Servicing LP (“Bank of America”). The assignment to Bank of America was recorded in the Fort Bend County Property Records on December 1, 2011. On December 12, 2011, Bank of America sent another Notice of Default to Beverly Johnson. The Notice of Default sought only the past due balance on the mortgage rather than the entire balance due and owing on mortgage. Specifically, the Notice of Default stated that “[i]f the default is not cured on or before January 11, 2012, the mortgage payments will be accelerated with the full amount remaining accelerated and becoming due and payable in full, and foreclosure proceedings will be initiated at that time.” (Dkt. No. 8, Ex. 6).

         On April 5, 2012, Bank of America assigned its interest in the Deed of Trust to the Trustee (the “Trustee Assignment”). The Trustee's Assignment was recorded in the Fort Bend County Real Property Records on April 12, 2012. On May 5, 2015, the Property was sold at a foreclosure sale. The current mortgagee listed on the Substitute Trustee's Deed is MASTR Alternative Loan Trust 2033-7 Mortgage Pass Through Certificates, Series 2003-7, U.S. Bank National Association, as Trustee, Successor in Interest to Wachovia Bank, National Association, as Trustee W/A/T/A U.S. Bank National Association, as Successor Trustee to Wachovia Bank, N.A., as Trustee for the Holders of the MASTR Alternative Loan Trust 2003-7.

         On June 11, 2015, the plaintiffs initiated an action against the defendants in the 400th Judicial District Court of Fort Bend County, Texas seeking a declaratory judgement: (1) that the lien and power of sale against their homestead has expired; (2) that the May 2015 foreclosure sale was wrongful and improper; and (3) to quiet title in their names. The plaintiffs also assert violations of the Texas Debt Collection Act (“TDCA”) and the Fair Debt Collection Practices Act, 15 U.S.C § 1692e(5) (“FDCPA”), against the defendants and seek to prevent them from engaging in any future foreclosure or collection activity. On June 19, 2015, the defendants timely removed the state court action to this Court, which has jurisdiction pursuant to 28 U.S.C. § 1331.

         III. SUMMARY JUDGMENT STANDARD

         Rule 56 of the Federal Rules of Civil Procedure authorizes summary judgment against a party who fails to make a sufficient showing of the existence of an element essential to the party's case and on which that party bears the burden at trial. See Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986); Little v. Liquid Air Corp., 37 F.3d 1069, 1075 (5th Cir. 1994) (en banc). The movant bears the initial burden of “informing the district court of the basis for its motion” and identifying those portions of the record “which it believes demonstrate the absence of a genuine issue of material fact.” Celotex, 477 U.S. at 323; see also Martinez v. Schlumber, Ltd., 338 F.3d 407, 411 (5th Cir. 2003). Summary judgment is appropriate where “the pleadings, the discovery and disclosure materials on file, and any affidavits show that there is no genuine issue as to any material fact and that the movant is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(c).

         If the movant meets its burden, the burden then shifts to the nonmovant to “go beyond the pleadings and designate specific facts showing that there is a genuine issue for trial.” Stults v. Conoco, Inc., 76 F.3d 651, 656 (5th Cir. 1996) (citing Tubacex, Inc. v. M/V Risan, 45 F.3d 951, 954 (5th Cir. 1995); Little, 37 F.3d at 1075). “To meet this burden, the nonmovant must ‘identify specific evidence in the record and articulate the ‘precise manner' in which that evidence support[s] [its] claim[s].'” Stults, 76 F.3d at 656 (citing Forsyth v. Barr, 19 F.3d 1527, 1537 (5th Cir.), cert. denied, 513 U.S. 871, 115 S.Ct. 195, 130 L.Ed.2d 127 (1994)). It may not satisfy its burden “with some metaphysical doubt as to the material facts, by conclusory allegations, by unsubstantiated assertions, or by only a scintilla of evidence.” Little, 37 F.3d at 1075 (internal quotation marks and citations omitted). Instead, it “must set forth specific facts showing the existence of a ‘genuine' issue concerning every essential component of its case.” Am. Eagle Airlines, Inc. v. Air Line Pilots Ass'n, Intern., 343 F.3d 401, 405 (5th Cir. 2003) (citing Morris v. Covan World Wide Moving, Inc., 144 F.3d 377, 380 (5th Cir. 1998)).

         “A fact is material only if its resolution would affect the outcome of the action, . . . and an issue is genuine only ‘if the evidence is sufficient for a reasonable jury to return a verdict for the [nonmovant].'” Wiley v. State Farm Fire and Cas. Co., 585 F.3d 206, 210 (5th Cir. 2009) (internal citations omitted). When determining whether a genuine issue of material fact has been established, a reviewing court is required to construe “all facts and inferences . . . in the light most favorable to the [nonmovant].” Boudreaux v. Swift Transp. Co., Inc., 402 F.3d 536, 540 (5th Cir. 2005) (citing Armstrong v. Am. Home Shield Corp., 333 F.3d 566, 568 (5th Cir. 2003)). Likewise, all “factual controversies [are to be resolved] in favor of the [nonmovant], but only where there is an actual controversy, that is, when both parties have submitted evidence of contradictory facts.” Boudreaux, 402 F.3d at 540 (citing Little, 37 F.3d at 1075 (emphasis omitted)). Nonetheless, a reviewing court is not permitted to “weigh the evidence or evaluate the credibility of witnesses.” Boudreaux, 402 F.3d at 540 (quoting Morris, 144 F.3d at 380). Thus, “[t]he appropriate inquiry [on summary judgment] ...


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