Jerry Hofrock v. Nationstar Mortgage, LLC Federal National Mortgage Association (Fannie Mae) And Jonathan Kantor
03-16-00114-CV
| Tex. App. | Sep 29, 2016Background
- In 2011 Nationstar filed a Rule 736 expedited foreclosure application against Jerry Hofrock for a home-equity loan on property in Travis County; Nationstar mailed the Rule 736 notice by certified and first-class mail and filed a certificate of service.
- Hofrock defaulted; Nationstar obtained a Rule 736 order on August 30, 2011, and subsequently conducted a foreclosure sale in March 2012 at which Fannie Mae purchased the property.
- Fannie Mae obtained possession through forcible-detainer proceedings and later sold the property to Jonathan Kantor, who now occupies it.
- Hofrock repeatedly sued or challenged the Rule 736 order and the foreclosure in multiple state and federal actions, including a federal suit dismissed with prejudice; he maintains the central complaint that he was not properly served under Rule 736.
- In the district court for this bill-of-review action, appellees moved for summary judgment and sanctions; the court granted summary judgment and sanctions, and Hofrock appealed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether lack of proper service under Rule 736 deprived the court of jurisdiction to enter the foreclosure order | Hofrock contends he was not properly served under the controlling service rules, so the Rule 736 order is void | Appellees point out Hofrock appeared (filed a response), which waived the need for service; alternatively, they argue service complied with Rule 736(2) and the certificate is prima facie evidence | Court should affirm: appearance dispensed with service requirement; service also met Rule 736(2) requirements |
| Whether appellees produced prima facie proof of service under Rule 736 | Hofrock disputes service method and relies on Rule 99 arguments | Appellees show certified and first-class mailing plus filed certificate of service in the form required by Rule 736(2) | Court should treat certificate as prima facie proof of service (Appellees satisfied service requirements) |
| Whether Hofrock’s claims are barred by res judicata | Hofrock seeks to relitigate the propriety of the Rule 736 order | Appellees argue prior final judgments (including the federal dismissal with prejudice) and related proceedings involve the same claims or claims that could have been raised; Nationstar and Kantor are in privity with Fannie Mae | Court should affirm: res judicata bars Hofrock’s bill-of-review action |
| Whether a bill of review is a permissible vehicle to attack a Rule 736 order | Hofrock uses bill of review to challenge the order | Appellees note Rule 736 (as later amended) bars bill of review and, even pre-amendment, multiple prior final adjudications exist | Court notes §736 historically made orders nonappealable; prior final judgments render collateral attack inappropriate |
Key Cases Cited
- Amstadt v. U.S. Brass Corp., 919 S.W.2d 644 (Tex. 1996) (privity defined by shared legal interests and representation)
- Citizens Ins. Co. of Am. v. Daccach, 217 S.W.3d 430 (Tex. 2007) (elements of res judicata)
- Barr v. Resolution Trust Corp., 837 S.W.2d 627 (Tex. 1992) (res judicata bars relitigation of claims finally adjudicated)
- Downs v. Trevathan, 783 S.W.2d 689 (Tex. App.—Houston [1st Dist.] 1989, orig. proceeding) (rule amendments not applied retroactively in context of procedure)