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Wheeler v. MTGLQ Investors, L.P.

Court of Appeals of Texas, First District

July 25, 2019

JIMMIE DALE WHEELER, Appellant
v.
MTGLQ INVESTORS, L.P. AND NEW PENN FINANCIAL, LLC D/B/A SHELLPOINT MORTGAGE SERVICING, Appellees

          On Appeal from the 125th District Harris County, Texas Trial Court Case No. 2016-88326

          Panel consists of Justices Keyes, Lloyd, and Hightower.

          MEMORANDUM OPINION

          Russell Lloyd, Justice

         Appellant, Jimmie Dale Wheeler, appeals the trial court's order granting summary judgment in favor of appellees, MTGLQ Investors, L.P. and New Penn Financial, LLC d/b/a Shellpoint Mortgage Servicing[1] and a take-nothing judgment on Wheeler's claims for breach of contract and declaratory and injunctive relief. Wheeler contends that the trial court erred because (1) the statute of limitations bars MTGLQ's enforcement of its lien; (2) MTGLQ cannot enforce its lien because Wheeler did not agree to allow MTGLQ such a right in the deed of trust; and (3) Texas Practice and Remedies Code section 16.038 is unconstitutional. We affirm.

         Background

         Wheeler, a former investment adviser and real estate developer, obtained a secured loan to purchase property in 1993. After Wheeler repeatedly failed to repay the loan, JPMorgan Chase Bank, N.A., the loan servicer at the time, and Wheeler entered into two forbearance agreements-in August 2005 and November 2007- and two modification agreements-in October 2006 and December 2010-to allow Wheeler to cure his defaults. The 2010 modification agreement extended the loan's maturity date to November 1, 2050.

         Under the 2010 modification agreement, Wheeler made five payments but did not make a payment in May 2011 or any payment thereafter. After Wheeler defaulted on the modified loan, Chase sent him written notice of his default on December 7, 2011, informing him that if he failed to cure his default Chase would accelerate his loan. Wheeler did not cure his default and Chase's foreclosure counsel, Barrett Daffin, sent Wheeler notices of acceleration dated May 2, 2011 and June 20, 2011. The acceleration notices also advised Wheeler that the substitute trustee would foreclose on the property on June 7 and August 2, 2011, respectively.

         Chase did not foreclose on the property on June 7 or August 2, 2011. On January 19, 2012, Daffin sent notice to Wheeler that Chase rescinded "the notice of acceleration dated 6/20/11 and all prior notices of acceleration." After Wheeler did not bring his loan current following the deceleration, Daffin sent Wheeler a notice of acceleration, advising him that the substitute trustee would foreclose on the property on February 5, 2013. On February 4, 2013, Wheeler sued Chase and obtained a temporary restraining order to prevent foreclosure.

         The trial court subsequently dismissed Wheeler's suit. Daffin sent Wheeler a notice of acceleration dated September 11, 2014, advising him that the substitute trustee would sell the property on October 7, 2014. On November 20, 2014, Daffin sent another notice of acceleration to Wheeler, advising him that the trustee would sell the property at a foreclosure sale on January 6, 2015. Wheeler again sued Chase and obtained a temporary restraining order to prevent foreclosure on January 5, 2015.

         The trial court dismissed Wheeler's second suit. Two months later, and after Chase did not proceed with the foreclosure sale, Chase's counsel sent Wheeler notice dated May 13, 2015, advising him that Chase "rescinds and abandons any acceleration of the Note or any other debt secured by the Deed of Trust made by [Chase] or by its servicer(s) prior to the date of execution of this document."

         Chase subsequently transferred servicing of Wheeler's loan to Shellpoint, effective February 1, 2016. On May 9, 2016, Shellpoint, as the servicer for MTGLQ, sent a notice to Wheeler advising him that his loan was in default and that, if he failed to cure his default within forty-five days, Shellpoint would accelerate the loan. Wheeler did not cure his default. On November 23, 2016, Shellpoint accelerated the loan, advising Wheeler that the foreclosure sale would take place on January 3, 2017.

         On December 28, 2016, Wheeler filed the instant suit "seek[ing] to stop the pending foreclosure of his homestead." He alleged that a pending foreclosure sale was "in breach of contract" and that the four-year statute of limitations prevented MTGLQ from "enforc[ing] the lien and power of sale in the Deed of Trust." Wheeler sought temporary injunctive relief "blocking all aspects of the foreclosure process during the pendency of [the] case" and a declaratory judgment that "the lien and power of sale in the Deed of Trust have expired" and "MTGLQ has no legal interest in the property." Wheeler also requested "his costs and reasonable and necessary attorney fees under Section 37.009" of the Civil Practice and Remedies Code. On December 29, 2016, the court entered another temporary restraining order preventing Shellpoint and MTGLQ from proceeding with foreclosure. The order included the following handwritten notation: "This is Plaintiff's third suit to block foreclosure on this property." On January 27, 2017, Shellpoint and MTGLQ filed their answer.

         On March 21, 2018, MTGLQ and Shellpoint moved for traditional summary judgment on the grounds that limitations did not bar enforcement of the lien on Wheeler's property or sale of the property and MTGLQ did not breach any contract. On March 23, 2018, Wheeler moved for summary judgment on the basis that "the lien against his homestead had expired as a matter of law." On April 9, 2018, MTGLQ and Shellpoint filed their response to Wheeler's summary judgment motion. On July 14, 2018, Wheeler filed his reply to MTGLQ and Shellpoint's summary judgment response and his response to their summary judgment motion.

         On July 17, 2018, the trial court entered an order (1) granting MTGLQ and Shellpoint's motion for summary judgment; (2) denying Wheeler's motion for summary judgment; and (3) awarding MTGLQ and Shellpoint a take-nothing judgment on Wheeler's affirmative claims for relief against them.

         On August 14, 2018, Wheeler moved for rehearing and a new trial. The trial court denied Wheeler's motions on ...


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