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Ainsworth v. Wells Fargo Home Mortgage Inc.

United States District Court, N.D. Texas, Dallas Division

April 6, 2018

SHOGER JAMDALANI AINSWORTH, and WALTER J. AINSWORTH, Plaintiffs,
v.
WELLS FARGO HOME MORTGAGE, INC., et al., Defendants.

          FINDINGS, CONCLUSIONS, AND RECOMMENDATION

          IRMA CARRILLO RAMIREZ UNITED STATES MAGISTRATE JUDGE

         By Special Order No. 3-251, this case was automatically referred for full case management. Before the Court for recommendation is the defendants' Motion for Relief from Final Judgment and Brief in Support, filed September 6, 2017 (doc. 95). Based on the relevant filings, evidence, and applicable law, the motion should be DENIED.

         I. BACKGROUND

         This case involves the foreclosure proceedings of real property located at 400 Gingko Circle, Irving, Texas 75063 (the Property). (doc. 45 at 2.)[1]

         On May 5, 2014, Shoger Jamdalani Ainsworth and Walter J. Ainsworth (Plaintiffs) filed this suit against Wells Fargo Home Mortgage, Inc., a division of Wells Fargo Bank, N.A. (Wells Fargo) and U.S. Bank National Association, as Trustee for CitiGroup Mortgage Loan Trust Inc., Mortgage Pass-Through Certificates, Series 2006 - WF1 (U.S. Bank) (collectively Defendants), alleging violations of the Texas Debt Collection Practices Act and seeking to quiet title.[2] (See docs. 1-4, 45.) Defendants removed the action to federal court asserting diversity jurisdiction under 28 U.S.C. § 1332 on May 29, 2014, and asserted a counterclaim for judicial foreclosure based on a home equity loan.[3] (docs. 1 at 3, 1-20, 44.) On March 23, 2016, Plaintiffs' claims against Defendants were dismissed with prejudice under Rule 12(b)(6) for failure to state a claim. (docs. 58, 59, 60.)

         On October 7, 2016, Defendants filed a summary judgment motion on their counterclaim for judicial foreclosure. (docs. 71, 72.) On May 30, 2017, the court found that “Defendants [had] met their summary judgment burden to show no genuine issue exists as to any material fact on their counterclaim for judicial foreclosure” because their motion and attached exhibits:

show that a debt in the amount of $384, 000.0006 due in monthly installments payable to Wells Fargo exists under the Note [executed by Plaintiffs] (see doc. 73-1 at 6-10), and that it is secured by a lien created in the Deed of Trust under Article 16, Section 50(a)(6) of the Texas Constitution (see Id. at 12- 28) . . . [and the] exhibits show that Plaintiffs are in default under the Note and Deed of Trust because they failed to make payments beginning on March 1, 2008 (see Id. at 37-77), and that they were properly served with a notice of default on July 6, 2012, and a notice of acceleration on March 7, 2013 (see doc. 73- 2).

(doc. 86 at 10-11.) It also found that “[a]t the time the summary judgment motion was filed, the amount necessary to reinstate the loan was $387, 130.98, and the amount necessary to pay off the loan was $752, 649.82.” (Id. at 10 n.6.)[4] These findings were accepted, and summary judgment was granted, on August 7, 2017, and a Final Judgment was issued that same day that authorized Defendants to “foreclose on their lien on the real property located at 400 Gingko Circle, Irving, Texas 75063 in accordance with the note, deed of trust, and § 51.002 of the Texas Property Code.” (doc. 94.)

         One month after judgment was entered, Defendants requested that the Final Judgment “be amended by the Court to more precisely define the relief it awards Defendants” and include certain terms so that they can execute the judgment under Texas procedural law. (doc. 95 at 3.) They expressly seek relief under Federal Rule of Civil Procedure 60(b)(4), arguing that the Final Judgment is “void” and should be “reform[ed].” (Id. at 4-5.) With a timely filed response and reply, this motion is ripe for recommendation. (docs. 97, 98.)

         II. MOTION FOR RELIEF FROM JUDGMENT

         Defendants contend that the Final Judgment is void under Rule 60(b)(4) because it is “vague.” (doc. 95 at 3.)

         A. Rule 60(b)(4)

         Rule 60(b)(4) provides that upon motion, a court may relieve a party from a final judgment or order if the judgment is void. Fed.R.Civ.P. 60(b)(4). The Fifth Circuit has recognized two circumstances when a district court's judgment may be set aside as void under Rule 60(b)(4): (1) if the district court lacked subject matter or personal jurisdiction over the case, or (2) if the district court acted in a manner contrary to due process. See Automation Support, Inc. v. Humble Design, L.L.C., No. 17-10433, 2018 WL 1474937, at *2 (5th Cir. Mar. 26, 2018); Carter v. Fenner, 136 F.3d 1000, 1005 (5th Cir. 1998). A Rule 60(b)(4) challenge to jurisdiction should be sustained “only where there is a clear usurpation of power or total want of jurisdiction.” Automation Support, Inc., 2018 WL 1474937, at *2. Due process in civil cases usually requires only proper notice and service of process and a court of competent jurisdiction, and even serious procedural irregularities during the course of the civil case will not subject the judgment to collateral attack as void. New York Life Ins. Co. v. Brown, 84 F.3d 137, 143 (5th Cir. 1996). Even where a judgment is “defective due to an error in law, [it] is not for that reason void.” Gulf Coast Bldg. & Supply Co. v. Int'l Bhd. of Elec. Workers, Local No. 480, AFL-CIO, 460 F.2d 105, 108 (5th Cir. 1972). “The Fifth Circuit has not resolved the question of which party bears the burden of proof on a Rule 60(b)(4) motion.” See Sindhi v. Raina, No. 3:15-CV-3229-D, 2017 WL 4167511, at *3 (N.D. Tex. Sept. 20, 2017) (citing Jackson v. FIE Corp., 302 F.3d 515, 521 n.6 (5th Cir. 2002) (declining to “choose a side in the split of authority on this question”)).

         Here, a Final Judgment was entered that authorized Defendants to “foreclose on their lien on the real property located at 400 Gingko Circle, Irving, Texas 75063 in accordance with the note, deed of trust, and § 51.002 of the Texas Property Code.” (doc. 94.) None of the parties assert any jurisdictional defects or due process concerns, and a review of the record shows no error under either of the “two circumstances” identified by the Fifth Circuit that would void a judgment. See ...


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