SHARON D. ROSE, Plaintiff-Appellant,
SELECT PORTFOLIO SERVICING, INCORPORATED; U.S. BANCORP, Defendants-Appellees.
from the United States District Court for the Western
District of Texas
OWEN, Chief Judge, and SOUTHWICK and WILLETT, Circuit Judges.
case is about a foreclosure. Plaintiff ShaRon Rose (Rose)
sued Select Portfolio Servicing, Inc. (SPS) and U.S. Bank,
N.A. (US Bank) (collectively Defendants), asserting a claim
to quiet title and separately seeking a declaratory judgment
that the statute of limitations had expired on
Defendants' power to foreclose on certain real property.
The Defendants counterclaimed for judicial foreclosure,
relying on various tolling concepts. The district court
denied Rose's motion for summary judgment, granted the
Defendants' motion for summary judgment, and entered a
Final Judgment and Order of Foreclosure. Rose now appeals,
challenging the district court's determination that the
statute of limitations had not run on the Defendants'
counterclaim for judicial foreclosure. We affirm.
2005, Rose and her then-husband purchased property with a
purchase-money mortgage. The mortgage was eventually assigned
to U.S. Bank, with SPS servicing the loan. In 2010, Rose and
her husband divorced. Rose's husband was awarded the
home, subject to a lien that required him to convey the home
to Rose in the event of default. The record indicates that no
payment has been made on the loan since March 1, 2011.
Although the property was not conveyed to Rose until 2016,
she has been actively involved in litigation concerning
foreclosure of the property since early 2014.
October 1, 2013, Defendants sent Rose a Notice of Default
regarding the loan and her property. Then, on March 26, 2014,
Defendants sent Rose a Notice of Acceleration regarding the
loan and property, setting a May 6, 2014 foreclosure sale. On
May 5, 2014, Rose sued in Texas state court, asserting
various claims relating to the pending foreclosure sale and
requesting a TRO. The state court granted the TRO that same
day, blocking the May 6th foreclosure sale. After the TRO
expired, the Defendants removed the case to federal court.
The case was then dismissed with prejudice by stipulation of
2, 2015, the Defendants sent Rose a second Notice of
Acceleration, setting a July 7, 2015 foreclosure sale. On
January 4, 2016, Rose filed her first bankruptcy petition.
The matter was dismissed on January 28, 2016 because Rose
failed to file timely a "Plan and/or Schedules."
Over the course of the next three years, the Defendants sent
three additional Notices of Acceleration, each setting a new
date for the foreclosure sale. Each time, Rose filed for
bankruptcy protection just days before the scheduled sale,
thwarting Defendants' attempts to foreclosure. According
to the parties, the four bankruptcy proceedings were pending
for at least 269 days.
her last bankruptcy matter was dismissed, Rose sued to quiet
title in state court, claiming that the statute of
limitations had expired on Defendants' power to
foreclose. Defendants removed under diversity jurisdiction.
Then, on September 21, 2018, Defendants counterclaimed for
judicial foreclosure. Both parties moved for summary
judgment. The district court denied Rose's motion and
granted the Defendants' motion, adopting the magistrate
judge's report and recommendation that the statute of
limitations had not expired on Defendants' power to
foreclose. The district court then entered a Final Judgment
and Order of Foreclosure in favor of the defendants. Rose
appeals the Report and Recommendation, the Order on the
Report and Recommendation of the United States Magistrate
Judge, and the Final Judgment and Order of Foreclosure.
court reviews a grant of summary judgment de
novo. A grant of summary judgment is appropriate
only if "the movant shows that there is no genuine
dispute as to any material fact and the movant is entitled to
judgment as a matter of law." "The evidence and all
inferences must be viewed in the light most favorable to the
appeal hinges on whether the statute of limitations expired
on the Defendants' power to foreclose on her property.
Whether the statute of limitations expired turns on the
length of Rose's bankruptcy stays. According to Rose, her
status as a repeat filer under the bankruptcy code curtails
the stays in this case to 135 days. Under that calculation,
the Defendants' claim would be barred. She argues that
the district court erred in concluding otherwise.
Texas Civil Practice and Remedies Code § 16.035(a),
"[a] person must bring suit for the recovery of real
property under a real property lien or the foreclosure of a
real property lien not later than four years after the day
the cause of action accrues." Similarly, "[a] sale of
real property under a power of sale in a mortgage or deed of
trust that creates a real property lien must be made not
later than four years after the day the cause of action
accrues." After four years from accrual, "the
real property lien and a power of sale to enforce the real
property lien become void."
common law tolls the statute of limitations during a
bankruptcy stay. The federal Bankruptcy Abuse Prevention
and Consumer Protection Act of 2005 (BAPCPA), however, limits
the automatic stay for debtors who have filed for bankruptcy
within the past year. Specifically, 11 U.S.C. §
(3) if a single or joint case is filed by or against a debtor
who is an individual in a case under Chapter 7, 11, or 13,
and if a single or joint case of the debtor was pending
within the preceding 1-year period but was dismissed, other
than a case refiled under a chapter other than Chapter 7
after dismissal under section 707(b)-
(A) the stay under subsection (a) with respect to any action
taken with respect to a debt or property securing such debt
or with respect to any lease shall terminate with respect to
the debtor on the 30th day after the filing of the later case
. . . .
are divided on the proper interpretation of §
362(c)(3)(A) and the import of the phrase "with respect
to the debtor." The Fifth Circuit has not addressed the
issue. The majority view, adopted by three bankruptcy courts
in this circuit,  interprets the provision to terminate the
stay as to actions against the debtor but not as to actions
against the bankruptcy estate.According to the majority, the
plain meaning of the provision dictates such an
interpretation. The minority view, adopted by the First
Circuit as a matter of first impression in the courts of
appeals, "reads the provision to terminate the whole
stay." According to the minority, the provision
is ambiguous; therefore, congressional intent is