United States District Court, S.D. Texas, Houston Division
Honorable Alfred H. Bennett United States District Judge.
the Court are Plaintiff PNC Bank National Association's
("PNC") Motion for Summary Judgment (Doc. #23),
Defendants William C. Fisher, IV and Judy Raymond
Fisher's (the "Fishers") Motion for Summary
Judgment (Doc. #24) and Brief in Support of their Motion
(Doc. #25), and the Fishers' Response to Plaintiffs
Motion for Summary Judgment (Doc. #26). PNC did not respond
to the Fishers' Motion for Summary Judgment. Having
considered the arguments and the applicable legal authority,
the Court grants the Fishers' Motion for Summary
Judgment, and denies PNC's cross-motion for summary
case is a judicial foreclosure action brought by PNC against
the Fishers. In response, the Fishers countersued for a
declaratory judgment that PNC's suit for judicial
foreclosure is barred given the applicable statute of
limitations. As both parties agree the applicable statute of
limitations would have expired on April 24, 2013 without some
type of tolling or abandonment, this case hinges on whether
PNC abandoned the initial acceleration of the applicable loan
before the four year statute of limitations expired.
Fishers own a house located at 4642 Waring Street, Houston,
Texas 77027, subject to a home equity loan ("Note")
and security instrument ("Deed of Trust") now
payable to PNC. Doc. #23, at 4-5. The Note was first assigned
to RBC Bank ("RBC"). Doc. #23, at 5. The Note and
the Deed of Trust contained acceleration clauses, empowering
the lender with an option to accelerate the full balance of
the loan in the event of a default. Doc. #23, Ex. 1, at 4-9.
Fishers first failed to make their required monthly payment
in November 2008, and have made no payments since that date.
See Doc. #24. As a result, RBC sent the Fishers a
letter on January 5, 2009, notifying them of the amount
overdue, and providing them thirty days to cure the default
or face acceleration of the Note (the "Notice of Intent
to Accelerate"). Doc. #23, Ex. 1, at 10. On April 24,
2009, after the Fishers failed to cure the default, RBC sent
another notice informing the Fishers that RBC had elected to
accelerate the debt (the "April 24, 2009
Acceleration"). Id. at 12. After receiving this
notice, Mr. Fisher attempted to negotiate a loan modification
with RBC. Doc. #24, Ex. 3, at 6. There is no evidence RBC
offered Mr. Fisher a loan modification, and a July 30, 2009
letter sent by RBC's attorney establishes that RBC did
not accept Mr. Fisher's requests for modification. Doc.
#24, Ex. 2, at 4.
September 2009, based on the April 24, 2009 Acceleration, RBC
applied for an order under Texas Rule of Civil Procedure 736
("Rule 736") allowing it to proceed with an
expedited nonjudicial foreclosure. Doc. #23, at 6. The
Fishers responded by filing a separate petition challenging
RBC's right to foreclose. Id. The Fishers'
suit triggered automatic dismissal of RBC's Rule 736
application pursuant to Texas Rule of Civil Procedure 736.11.
Doc. #23, at 7. In September 2011, RBC filed its second Rule
736 application. Id. The Fishers again filed suit
contesting RBC's right to foreclose and again RBC's
application was automatically dismissed in February of 2012.
Id. Later that year, RBC merged with and into PNC,
and all parties agree PNC is now the holder of the Note and
Deed of Trust. Doc. #24, at 2. PNC did not file a
counterclaim seeking to foreclose in response to the
Fishers' lawsuits. See Doc. #23. Instead, the
Fishers voluntary dismissed both suits without prejudice each
time PNC's Rule 736 applications were dismissed.
October 19, 2011, after PNC's first Rule 736 application
was dismissed, PNC sent a second letter notifying the Fishers
that the bank had elected to accelerate the debt (the
"Second Notice of Acceleration"). Doc. #23, Ex. 1,
at 14. On two occasions in 2011, Mr. Fisher e-mailed PNC
again requesting a loan modification; PNC rejected both
requests. Doc. #24, Ex. 3, at 14-15. Finally, on September 6,
2013, PNC sent the Fishers a letter notifying them they could
reinstate their loan by paying $112, 956.00-an amount less
than the total accelerated balance (the "Reinstatement
Quote"). Doc. #23, Ex. 1, at 18. The Fishers did not
make any payments to PNC in response to the Reinstatement
Quote or at any time since their original default. Doc. #24,
Motion for Summary Judgment
judgment is appropriate if no genuine issue of material fact
exists and the moving party is entitled to judgment as a
matter of law. Fed.R.Civ.P. 56(a). "The movant bears the
burden of identifying those portions of the record it
believes demonstrate the absence of a genuine issue of
material fact." Triple Tee Golf, Inc. v. Nike,
Inc., 485 F.3d 253, 261 (5th Cir. 2007) (citing
Celotex Corp. v. Catrett, 477 U.S. 317, 322-25
(1986)). If the burden of proof at trial lies with the
nonmoving party, the movant may satisfy its initial burden by
"'showing'-that is, pointing out to the district
court-that there is an absence of evidence to support the
nonmoving party's case." See Celotex, 477
U.S. at 325. While the party moving for summary judgment must
demonstrate the absence of a genuine issue of material fact,
it does not need to negate the elements of the
nonmovant's case. Boudreaux v. Swift Transp.
Co., 402 F.3d 536, 540 (5th Cir. 2005) (citation
omitted). "A fact is 'material' if its
resolution in favor of one party might affect the outcome of
the lawsuit under governing law." Sossamon v. Lone
Star State of Texas, 560 F.3d 316, 326 (5th Cir. 2009)
(quotation omitted). "If the moving party fails to meet
[its] initial burden, the motion [for summary judgment] must
be denied, regardless of the nonmovant's response."
United States v. $92, 203.00 in U.S. Currency, 537
F.3d 504, 507 (5th Cir. 2008) (quoting Little v. Liquid
Air Corp., 37 F.3d 1069, 1075 (5th Cir. 1994)
the moving party has met its Rule 56 burden, the nonmoving
party cannot survive a summary judgment motion by resting on
the mere allegations of its pleadings. The nonmovant must
identify specific evidence in the record and articulate how
that evidence supports that party's claim. Baranowski
v. Hart, 486 F.3d 112, 119 (5th Cir. 2007). "This
burden will not be satisfied by 'some metaphysical doubt
as to the material facts, by conclusory allegations, by
unsubstantiated assertions, or by only a scintilla of
evidence.'" Boudreaux, 402 F.3d at 540
(quoting Little, 37 F.3d at 1075). In deciding a
summary judgment motion, the court draws all reasonable
inferences in the light most favorable to the nonmoving
party. Connors v. Graves, 538 F.3d 373, 376 (5th
Limitations and Abandonment
Texas law, a secured lender must bring suit for judicial
foreclosure of a real property lien not later than four years
after the day the cause of action accrues." Boren v.
U.S. Nat. Bank Ass'n, 807 F.3d at 104 (5th Cir.
2015), citing Tex. Civ. Prac. & Rem. Code §
16.035(a). The applicable four-year statute of limitations
for real property actions is found in Texas Civil Practice
and Remedies Code § 16.035, addressing (a) judicial
foreclosures, and (b) nonjudicial foreclosures.Clawson v.
GMAC Mortg., LLC, Civ. A. No. 3:12-CV-00212, 2013 U.S.
Dist. 2013 WL 1948128, at *2 (S.D. Tex. May 9, 2013). Once
the four-year period expires, "the real property lien
and a power of sale to enforce the real property lien become
void." Tex. Civ. Prac. & Rem. Code § 16.035
(d). If, as here, "a note or deed of trust secured by
real property contains an optional acceleration clause,
" the action accrues "when the holder actually
exercises its option to ...