Coleman v. BAC Servicing
104 So. 3d 195
| Ala. Civ. App. | 2012Background
- Coleman and husband obtained a $93,215 loan from Johnson in 1994 to buy a home, with a mortgage to Johnson; the note/mortgage chain later involved Trans Financial, Firstar, MERS, and MidFirst; MidFirst possessed the original note beginning September 17, 2005, prior to foreclosure proceedings in July 2009; Coleman’s husband died in 2007, after which Coleman paid using savings and life-insurance proceeds until 2009; foreclosure sale occurred September 1, 2009 with MidFirst as purchaser; the Secretary of Veterans Affairs acquired the property via a special warranty deed on July 28, 2009; BAC filed ejectment suit in September 2009; Coleman answered with defenses including defective notice and wrongful foreclosure; summary judgment in BAC’s favor was granted on August 31, 2010; Coleman appealed and the supreme court transferred to this court; the court affirmed the summary judgment.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether MidFirst could foreclose as holder of the note before the assignment | Coleman argues MidFirst lacked right to foreclose because not the note's assignee at foreclosure | BAC argues MidFirst held the note via physical possession prior to foreclosure, giving authority to foreclose | MidFirst had the right to foreclose as holder of the note before assignment |
| Whether Poage’s second affidavit complied with Rule 56(e) | Coleman contends the second affidavit lacked personal-knowledge basis and proper sworn exhibits | BAC maintains the affidavit shows personal knowledge and proper attached exhibit is sworn | Yes; the affidavit was based on personal knowledge and properly supported by exhibits, including Exhibit B |
| Whether the August 27, 2009 note assignment created a genuine fact conflict | Coleman argues conflicting dates of acquisition create a material fact issue | MidFirst possessed the note since 2005 and the 2009 assignment was superfluous | No genuine issue; possession before foreclosure controls and 2009 assignment was not determinative |
| Whether loss-mitigation requirements bar ejectment | Coleman asserts HUD/VA loss-mitigation failures render foreclosure wrongful | Loss mitigation under HUD/VA does not defeat nonjudicial ejectment rights in Alabama | Loss-mitigation failures cannot be raised as a defense to ejectment following nonjudicial foreclosure |
| Whether after-acquired title doctrine cures title issues for the Secretary | Coleman argues title did not transfer to Secretary due to timing of MidFirst’s purchase | After-acquired title doctrine applies; title passes when MidFirst purchased at foreclosure | After-acquired title doctrine applies; Secretary’s title valid |
Key Cases Cited
- Harton v. Little, 57 So. 851 (Ala. 1911) (Ala. 1911) (foreclosure rights do not require prior formal mortgage assignment when debt holder possesses the note)
- Isbell v. Alabama Power Co., 477 So.2d 281 (Ala.1985) (Ala. 1985) (affidavits must show personal knowledge to satisfy Rule 56(e))
- Stephens v. First Commercial Bank, 45 So.3d 735 (Ala. 2010) (Ala. 2010) (affidavits authenticated and based on business records may be considered)
- Byrd v. MorEquity, Inc., 94 So.3d 378 (Ala.Civ.App.2012) (Ala.Civ.App. 2012) (conflicting dates of assignment; distinguishable where debt holder holds note)
- Bank of New York v. Raftogianis, 13 A.3d 435 (N.J. 2010) (N.J. 2010) (illustrates issues about timing of possession/endorsement in foreclosure)
- Jett v. Lawyers Title Ins. Corp., 985 So.2d 434 (Ala.Civ.App.2007) (Ala.Civ.App. 2007) (after-acquired title principles in title transfer context)
- West v. Founders Life Assurance Co. of Florida, 547 So.2d 870 (Ala.1989) (Ala. 1989) (definition of substantial evidence for summary judgment)
- Olive r v. Brock, 342 So.2d 1 (Ala.1976) (Ala.1976) (Rule 56(e) documentary sufficiency jurisprudence)
- Holman v. Childersburg Bancorporation, Inc., 852 So.2d 691 (Ala.2002) (Ala. 2002) (Statute of Frauds applicability to forbearance/ modification)
- White Sands Group, L.L.C. v. PRS II, LLC, 998 So.2d 1042 (Ala.2008) (Ala. 2008) (preserves procedural requirements for affidavits)