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Swoboda v. Ocwen Loan Servicing, LLC

Court of Appeals of Texas, Fourteenth District

May 23, 2019

GORDON M. SWOBODA, Appellant
v.
OCWEN LOAN SERVICING, LLC; AND U.S. BANK NATIONAL ASSOCIATION, AS TRUSTEE, Appellees

          On Appeal from the 11th District Court Harris County, Texas Trial Court Cause No. 2013-57888

          Panel consists of Justices Christopher, Jewell, and Hassan.

          OPINION

          TRACY CHRISTOPHER, JUSTICE

         The main question in this appeal is whether a home-foreclosure action is barred by the statute of limitations. The borrower moved for summary judgment in the court below, arguing that the foreclosure action was untimely because it was filed more than four years after the lender accelerated the maturity date of the note. The lender filed a cross-motion for summary judgment, arguing that its action was timely because the prior acceleration had been abandoned. The trial court denied the borrower's motion and granted the lender's cross-motion. Because we conclude that neither movant established that it was entitled to judgment as a matter of law, we reverse the trial court's judgment and remand the case for additional proceedings consistent with this opinion.

         BACKGROUND

         The borrower in this case is Gordon Swoboda, who in 2006 executed a thirty-year home equity note in the principal amount of $228, 000. That note is secured by a deed of trust, which was made for the benefit of the lender and all of its successors and assigns. The current assignee of the deed of trust is U.S. Bank National Association, and the current servicer of the loan is Ocwen Loan Servicing, LLC. For ease of reference, we identify these entities and all of their predecessors as the "Bank."

         Swoboda missed his monthly installment payment in April of 2008, and all payments thereafter. His default triggered a protracted history of litigation, which we condense into the following timeline:

• July 22, 2008-The Bank sends its first notice of acceleration, after having previously notified Swoboda of its intent to accelerate.
• August 22, 2008-The Bank files its first foreclosure petition in state court under Rule 736 of the Texas Rules of Civil Procedure. This petition is subsequently dismissed for want of prosecution.
• July 9, 2009-The Bank sends its second notice of acceleration.
• July 27, 2009-The Bank files its second foreclosure petition under Rule 736. This petition is also dismissed subsequently for want of prosecution.
• June 6, 2011-The Bank files its third foreclosure petition under Rule 736. The Bank subsequently nonsuits this petition.
• January 28, 2013-The Bank sends its third notice of acceleration.
• May 6, 2013-The Bank files its fourth foreclosure petition under Rule 736. Swoboda responds by filing an original petition in a separate cause number, seeking a stay and dismissal of the foreclosure action, as well as other forms of relief. The Bank removes that action to federal court because of diversity jurisdiction. The case stays there for nearly three years, until the federal court remands it back to state court after concluding that the Bank had not established complete diversity between the parties.

         Once back in state court, the parties filed the two motions for summary judgment that are the subject of this appeal. Swoboda argued, among other points in his motion, that the Bank's latest foreclosure action, which began in 2013, was barred by the four-year statute of limitations because the action accrued nearly five years earlier with the 2008 notice of acceleration. The Bank argued in its cross-motion that its action was not time-barred because the Bank abandoned the acceleration through a series of events, which are discussed in greater detail below. The trial court denied Swoboda's motion, granted the Bank's cross-motion, and rendered a final judgment declaring that the lien on Swoboda's property is foreclosed.

         Swoboda now appeals from that final judgment.

         STANDARD OF REVIEW

         When, as here, both parties move for summary judgment and the trial court grants one motion and denies the other, we consider all questions presented, examine all of the evidence, and render the judgment the trial court should have rendered. See Commr's Court of Titus Cnty. v. Agan, 940 S.W.2d 77, 81 (Tex. 1997).

         We review motions for summary judgment de novo. See Boerjan v. Rodriguez, 436 S.W.3d 307, 310 (Tex. 2014) (per curiam). To prevail on a traditional motion for summary judgment, the movant must 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. See Tex. R. Civ. P. 166a(c); M.D. Anderson Hosp. & Tumor Inst. v. Willrich, 28 S.W.3d 22, 23 (Tex. 2000) (per curiam). If the movant produces evidence that conclusively establishes its right to summary judgment, then the burden of proof shifts to the nonmovant to present evidence sufficient to raise a fact issue. See Centeq Realty, Inc. v. Siegler, 899 S.W.2d 195, 197 (Tex. 1995). When deciding whether a fact issue has been raised, we consider all of the evidence in the light most favorable to the nonmovant, indulging every reasonable inference and resolving any doubts in the nonmovant's favor. See Valence Operating Co. v. Dorsett, 164 S.W.3d 656, 661 (Tex. 2005).

         STATUTE OF LIMITATIONS AND ABANDONMENT OF ACCELERATION

         A lender must bring suit to foreclose on a real property lien "not later than four years after the day the cause of action accrues." See Tex. Civ. Prac. & Rem. Code § 16.035(a). As a general rule, the accrual date is the maturity date of the note, rather than the earlier date of the borrower's default. Id. § 16.035(e). But there is an exception to that rule: If the real property lien contains an optional acceleration clause, as the deed of trust does here, then the cause of action accrues when the lender exercises its option to accelerate the maturity date of the note. See Holy Cross Church of God in Christ v. Wolf, 44 S.W.3d 562, 566 (Tex. 2001).

         Once a lender has accelerated the maturity date of the note, the lender can restore the original maturity date-and therefore reset the running of limitations- by abandoning the acceleration as though it had never happened. Id. at 566-67. Abandonment is based on the concept of waiver, which requires the showing of three elements: (1) the party has an existing right; (2) the party has actual knowledge of the right; and (3) the party actually intends to relinquish the right, or engages in intentional conduct inconsistent with the right. See Ulico Cas. Co. v. Allied Pilots Ass'n, 262 S.W.3d 773, 778 (Tex. ...


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