Billings v. U.S. Bank National Ass'n
2016 Ark. App. 134
| Ark. Ct. App. | 2016Background
- Doann Billings died in 2011 leaving a mortgage on 701 S. 38th St., Van Buren, which was past due; her son Montrevel moved into the house and sought to assume the loan but did not reach an agreement with U.S. Bank.
- U.S. Bank sued for foreclosure on April 20, 2012, and sought constructive service by warning order for the unknown heirs and occupants under Ark. R. Civ. P. 4(f)(1).
- Affidavits supporting warning orders averred that, after "diligent inquiry," Montrevel was not a resident at the 38th Street address and his current address was unknown; those affidavits did not describe steps taken to locate him.
- Notices were published and the bank mailed copies to the 38th Street address; postal marks showed the mailings were "unclaimed." A default judgment and decree of foreclosure were entered on October 15, 2012, and sale procedures followed (later temporarily suspended).
- Montrevel moved to vacate the decree for lack of proper service, arguing he lived at the property and was never properly served; the circuit court denied relief and denied his motion for reconsideration, prompting this appeal.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the default judgment is void for lack of proper service by warning order | Billings: service was invalid because he actually lived at the property and the affidavits did not show a diligent inquiry before issuance of the warning order | U.S. Bank: affidavits and subsequent unclaimed mailings show notice was attempted and Montrevel avoided service | Reversed — service was improper because affidavits for the warning orders were conclusory and did not set forth facts showing a diligent inquiry before issuance, so the default judgment is void |
| Whether U.S. Bank was authorized to do business in Arkansas | Billings: U.S. Bank is not properly registered to do business in Arkansas (challenged as a ground to overturn foreclosure) | U.S. Bank: (not reached on appeal) | Not reached — issue not preserved for appeal because it was not raised to or decided by the circuit court |
Key Cases Cited
- Scott v. Wolfe, 384 S.W.3d 609 (Ark. App.) (standard of review and distinction when judgment alleged void)
- XTO Energy, Inc. v. Thacker, 467 S.W.3d 161 (Ark. App.) (affidavit for warning order must show facts evidencing a diligent inquiry before issuance)
- Smith v. Edwards, 648 S.W.2d 482 (Ark.) (mere recitation of "diligent inquiry" is insufficient)
- Grand Slam Stores, L.L.C. v. L & P Builders, Inc., 212 S.W.3d 6 (Ark. App.) (default judgments entered without valid service are void for lack of jurisdiction)
- City of Little Rock v. Rhee, 292 S.W.3d 292 (Ark.) (failure to obtain a ruling below procedurally bars appellate consideration)