Mid Pac Portfolio, LLC v. Paula Welch, Clyde Alan Ashworth and Wells Fargo Bank, Minnesota, NA Formerly Known as Norwest Bank, Minnesota, NA, as Trustee for Salomon Brothers Mortgage Securities VII, Inc. Floating Rate Mortgage Pass Through Certificates Series 1999-LBI
01-15-00404-CV
| Tex. App. | Jul 21, 2015Background
- In 2003 Welch and Ashworth executed a Deed in Lieu of Foreclosure to Wells Fargo as part of a settlement of a dispute over a Texas home-equity loan; the deed was held in escrow and would be released if they failed to pay off the loan by the agreed deadline.
- They failed to pay off the loan; the Deed in Lieu was later held by Citigroup as part of REO assets.
- Mid Pac acquired the original Deed in Lieu from Citigroup on June 1, 2012 and recorded it in Galveston County on March 14, 2013; Citigroup later stipulated and disclaimed any interest in the property.
- Mid Pac sued for declaratory relief/quiet title; Citigroup disclaimed interest and Wells Fargo did not appear (Mid Pac sought default judgment against Wells Fargo and Citigroup).
- The trial court granted Welch & Ashworth’s motion for summary judgment, denied Mid Pac’s cross-motion, entered an amended final judgment awarding Welch & Ashworth title and $5,208 in fees; Mid Pac appeals, arguing the deed passed title, certain affidavit evidence was improper, the default order was inconsistently applied, and the fee award was erroneous.
Issues
| Issue | Plaintiff's Argument (Mid Pac) | Defendant's Argument (Welch/Ashworth) | Held (trial court) |
|---|---|---|---|
| 1. Whether trial court erred in granting defendants’ MSJ and denying Mid Pac’s MSJ | Deed in Lieu was validly executed/delivered and Mid Pac acquired it from Citigroup; undisputed evidence entitles Mid Pac to judgment | Defendants asserted adverse-possession and limitations defenses and disputed title transfer facts | Trial court granted defendants’ MSJ and denied Mid Pac’s MSJ (entered judgment for Welch & Ashworth) |
| 2. Admissibility of Welch’s affidavit statements that taxes were paid from a servicer “suspense account” that belonged to her | Statements are inadequate/conclusory and not competent summary-judgment evidence | Affidavit statements and tax records supported their tax-payment assertions | Trial court considered Welch’s affidavits in ruling for defendants (Mid Pac argues those statements are inadmissible) |
| 3. Admissibility of Welch’s affidavit statements recounting historical loan disputes | Historical loan allegations are irrelevant to title question and conclusory | Past loan problems support equitable/contentions defeating Mid Pac’s claim | Trial court relied on summary-judgment record favoring defendants (Mid Pac contends these paragraphs were irrelevant) |
| 4. Whether the court’s amended final judgment correctly applied the earlier default order as to Wells Fargo and Citigroup | Earlier default order held neither Wells Fargo nor Citigroup had interest; final judgment should reflect both were cut off | Defendants maintained the final judgment limited default relief to Citigroup only | Trial court’s amended final judgment limited the default relief to Citigroup (Mid Pac contends inconsistency requires correction) |
| 5. Whether awarding attorney fees to Welch & Ashworth was proper | If judgment for Mid Pac is rendered on appeal, fee award is no longer equitable and should be reconsidered | Trial court found fees recoverable under Tex. Civ. Prac. & Rem. Code § 37.009 | Trial court awarded $5,208 to Welch & Ashworth (Mid Pac asks this be reconsidered if judgment reversed) |
Key Cases Cited
- FM Props. Operating Co. v. City of Austin, 22 S.W.3d 868 (Tex. 2000) (standard for reviewing cross-motions for summary judgment and rendering judgment appellate court should have rendered)
- Watson v. Tipton, 274 S.W.3d 791 (Tex. App.—Fort Worth 2008) (recording creates presumption of delivery and intent to transfer title)
- Rhodes v. Cahill, 802 S.W.2d 643 (Tex. 1990) (elements and strict construction of adverse possession)
- Sarandos v. Blanton, 25 S.W.3d 811 (Tex. App.—Waco 2000) (adverse-possession elements)
- Session v. Woods, 206 S.W.3d 772 (Tex. App.—Texarkana 2006) (adverse possession requires continuous, hostile, peaceable, and visible possession for statutory period)