Lourdes Alcala v. Deutsche Bank Natl Trust
684 F. App'x 436
| 5th Cir. | 2017Background
- In 2006 the Alcalas executed a Texas home-equity note for $216,000 secured by a deed of trust on Cypress, Texas property; the loan was assigned to Deutsche Bank in 2009.
- Deutsche filed an expedited foreclosure application in March 2009, stating the note had been accelerated; that action was dismissed in 2010 for want of prosecution.
- On September 11, 2012 Deutsche sent a notice of default giving the Alcalas 35 days to cure by paying the past-due amount (less than the full balance); no payment was made.
- Deutsche sent a new notice of acceleration on January 8, 2013 and filed another foreclosure application on March 4, 2015.
- The Alcalas sued in December 2015 seeking a declaration that the 2015 foreclosure was time-barred by the four-year statute of limitations measured from the 2009 acceleration; Deutsche removed and counterclaimed for foreclosure.
- The district court granted summary judgment for Deutsche; the Fifth Circuit affirmed, holding Deutsche abandoned its 2009 acceleration by the 2012 notice of default, resetting the limitations period and making the 2015 suit timely.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Deutsche's 2009 acceleration barred foreclosure filed in 2015 under Tex. Civ. Prac. & Rem. Code § 16.035 | Alcalas: 2009 acceleration started the 4-year limitations clock, so the March 2015 foreclosure is time-barred | Deutsche: 2012 notice of default unequivocally abandoned the 2009 acceleration and reset the accrual; the cause accrued at the 2013 acceleration | The court held Deutsche abandoned the 2009 acceleration by the 2012 notice; accrual occurred on Jan. 8, 2013, so the 2015 suit is timely |
| What constitutes unilateral abandonment of acceleration | Alcalas: contend abandonment not effective because they objected | Deutsche: no evidence they objected to the 2012 notice; objection must be timely and contemporaneous | The court held the Alcalas produced no timely objection; suit filed years later cannot retroactively prevent abandonment |
| Whether notice of default less than full-balance can prevent foreclosure or reset maturity | Alcalas: argued the prior acceleration control the accrual date | Deutsche: a notice offering cure of arrearage (less than full balance) manifests intent to abandon prior acceleration | The court held a notice offering opportunity to cure by paying less than full balance shows intent to abandon prior acceleration (following Boren) |
| Summary judgment standard application | Alcalas: disputed evidence or insufficient proof of no objection | Deutsche: no genuine dispute of material fact; entitled to judgment as a matter of law | The court applied de novo review and found no genuine dispute; affirmed summary judgment for Deutsche |
Key Cases Cited
- Boren v. U.S. Nat’l Bank Ass’n, 807 F.3d 99 (5th Cir. 2015) (lender’s later notice of default for less than full balance can show unequivocal abandonment of prior acceleration)
- Holy Cross Church of God in Christ v. Wolf, 44 S.W.3d 562 (Tex. 2001) (acceleration option exercised by holder accrues the cause of action)
- Ogden v. Gibraltar Sav. Ass’n, 640 S.W.2d 232 (Tex. 1982) (notice-of-intent and notice-of-acceleration requirement to effect acceleration)
- Burney v. Citigroup Glob. Mkts. Realty Corp., 244 S.W.3d 900 (Tex. App.—Dallas 2008) (filing of expedited foreclosure application can constitute notice of acceleration)
- Khan v. GBAK Props., Inc., 371 S.W.3d 347 (Tex. App.—Houston [1st Dist.] 2012) (abandonment of acceleration restores original maturity date for accrual)
- Rogers v. Bromac Title Servs., L.L.C., 755 F.3d 347 (5th Cir. 2014) (standard of review for summary judgment)