2012 NMCA 078
N.M. Ct. App.2012Background
- Charter Bank obtained a default judgment after Francoeur failed to answer; property later sold at public auction.
- Defendant moved to set aside the default and to vacate the foreclosure sale, and appeal two district court orders.
- District court denied both motions and set supersedeas bond at $150,000 during appeal.
- Sale occurred after multiple postponements; the property sold for $100,000 to Angelí, with a one-month redemption period.
- Defendant argued HAMP noncompliance, estoppel, fraud/misrepresentation, bad faith, and that the sale price was grossly inadequate; court found no meritorious defense and sale not shockingly unfair.
- Appeal affirmed: no meritorious defense, sale not shockingly unfair, and supersedeas bond appropriate.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Meritorious defense to set aside default | Francoeur lacks meritorious defense; HAMP/estoppel arguments fail | Defendant has meritorious defenses including HAMP noncompliance and estoppel | No meritorious defense; affirmed denial of set-aside |
| Sale should be vacated due to price shock | Price/value ratio does not shock the conscience | $100,000 sale price is grossly inadequate given appraised value | Sale not vacated; no circumstances showing a shocking injustice |
| Appropriateness of supersedeas bond amount | Bond amount properly indemnifies plaintiff for potential damages | Bond too high; rental value should cap it | Bond set at $150,000; not an abuse of discretion |
Key Cases Cited
- N.M. Educators Fed. Credit Union v. Woods, 102 N.M. 16 (1984) (requirements for setting aside a default judgment; two-element test and discretion summarized)
- Gandara v. Gandara, 2003-NMCA-036, 133 N.M. 329 (2003) (abuse-of-discretion standard for setting aside default judgments; favoring merits review)
- Armstrong v. Csurilla, 112 N.M. 579, 817 P.2d 1221 (1991) (foreclosure-sale fairness; guidance on price/value scrutiny and ‘shock the conscience’)
- Waggoner v. Town of Mesilla, 2011-NMCA-041, 149 N.M. 596, 252 P.3d 820 (2011) (statutory interpretation of damages for supersedeas; use of rental value as an element)