Citimortgage, Inc. v. Angeline Renee Drake
2013 Tenn. App. LEXIS 116
| Tenn. Ct. App. | 2013Background
- Borrower signed 2006 note secured by deed of trust on Chattanooga home; lender CitiMortgage after assignment foreclosed non-judicially under Section 22.
- Borrower defaulted 2007–2009, with limited payments 2009; loan acceleration occurred 2010; notices mailed to Borrower.
- Property sold at a trustee’s sale Sept. 20, 2010; CitiMortgage high bidder; trustee’s deed recorded Sept. 24, 2010.
- Borrower filed unlawful detainer; case stayed pending unresolved federal suit challenging foreclosure constitutionality; federal court found no state action.
- Borrower amended answer with counterclaim alleging Tennessee constitutional violations and public policy; trial court dismissed counterclaim and granted possession.
- This appeal challenges the dismissal of the counterclaim and the grant of summary judgment in CitiMortgage’s unlawful detainer action.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether state action is required for Tennessee constitutional claims | Drake argues state action exists via statutes regulating foreclosures | CitiMortgage/AG contend no state action; private foreclosure not state action | State action required; private foreclosure lacks state action; claims dismissed |
| Whether Tennessee open courts/remedies clauses limit private foreclosure | Open courts/remedies clauses protect Borrower from private action | Clauses limit government actions, not private conduct | Clauses do not apply to private foreclosure; claims dismissed |
| Public policy challenge to non-judicial foreclosure | Foreclosure statutes violate public policy by encroaching rights | Legislature approved private foreclosure as public policy | Public policy supports private foreclosure; claim fails |
| Whether summary judgment on unlawful detainer was proper based on notices and advertisements | Records lack proof of mailing and newspaper publication | Affidavits and trustee’s deed establish proper notices and three newspaper ads | Evidence sufficient; summary judgment affirmed |
Key Cases Cited
- State v. White, 362 S.W.3d 559 (Tenn. 2012) (open courts/due process synonymous with law of the land)
- Lynch v. City of Jellico, 205 S.W.3d 384 (Tenn. 2006) (due process/state action principles in Tenn.)
- Scott v. Nashville Bridge Co., 223 S.W.2d 844 (Tenn. 1920) (Scott discusses limits of Article I, §17 to judiciary vs legislature)
- Flagg Bros. v. Brooks, 436 U.S. 149 (U.S. 1978) (state action requirement; private action not state action absent compulsion)
- Beasley v. Citigroup, Beasley, 2007 WL 77289 (Tenn. Ct. App. W.S. 2007) ( wrongful foreclosure defense in unlawful detainer not severed from private action)
- Apao v. Bank of New York, 324 F.3d 1091 (9th Cir. 2003) (federal circuits hold no state action in non-judicial foreclosure)
- Garfinkle v. Superior Court of Contra Costa Cnty., 21 Cal.3d 268 (Cal. 1978) (non-judicial foreclosure not state action; private remedy caution)