Midland Properties v. Wells Fargo
296 Neb. 407
| Neb. | 2017Background
- Jerry Morgan obtained a loan secured by a deed of trust, conveyed the mortgaged property to Midland Properties, LLC, and managed it as a rental. Wells Fargo, N.A., was later assigned the note and deed of trust.
- Wells Fargo initiated a nonjudicial foreclosure for payment default; HBI purchased the property at the trustee’s sale and later conveyed it to H & S Partnership (H&S).
- Morgan and Midland sued Wells Fargo, HBI, and H&S alleging wrongful foreclosure, irregularities in assignments/substitution of trustees, and tortious interference with tenants; they sought declaratory relief, quiet title, damages, and rescission of the sale.
- Wells Fargo moved for summary judgment; the district court sustained the motion, excluded parts of Morgan’s affidavit/deposition as lacking foundation/hearsay, and dismissed the amended complaint.
- The court also denied leave to file a second amended complaint to add Wells Fargo’s independent contractor as a defendant, finding the motion untimely and the proposed claim futile.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Right to foreclose | Morgan testified Wells Fargo reps told him not to pay and they would not foreclose, so he was not in default | Wells Fargo produced records showing missed payments, proper notices, denial of modification due to title issues, and documents contradicting Morgan’s claimed verbal assurances | Court excluded Morgan’s testimony for lack of foundation (could not identify speakers/dates); Wells Fargo entitled to summary judgment on foreclosure/quiet title/declaratory claims |
| Evidentiary foundation for Morgan’s statements | Morgan’s deposition and affidavit establish conversations and tenant reports that create factual disputes | Morgan could not identify who he spoke with or when; tenant reports were hearsay without tenant affidavits/depositions | Court did not abuse discretion excluding those statements as lacking foundation/hearsay; exclusion was proper |
| Tortious interference with business relationships | Tenants were allegedly contacted/harassed by Wells Fargo reps before sale, causing $50,000 damages | Wells Fargo showed no records of contacting tenants; provided tenant affidavit denying contact; occupancy checks by an independent contractor did not show tenant contact | Court held plaintiff offered only hearsay through Morgan and failed to raise genuine issue; summary judgment for Wells Fargo on interference claim |
| Leave to amend to add independent contractor | Plaintiffs sought to add contractor ~9 months after amendment deadline, claiming recent discovery of contractor identity | Wells Fargo had identified the contractor at a deposition months earlier; plaintiffs offered no satisfactory explanation for delay and the claim would be futile | Court did not abuse discretion denying leave to amend; motion to add defendant denied |
Key Cases Cited
- Bixenmann v. Dickinson Land Surveyors, 294 Neb. 407, 882 N.W.2d 910 (Neb. 2016) (summary judgment standards and appellate review)
- State v. Casterline, 293 Neb. 41, 878 N.W.2d 38 (Neb. 2016) (abuse-of-discretion review for evidentiary rulings)
- Golnick v. Callender, 290 Neb. 395, 860 N.W.2d 180 (Neb. 2015) (procedural standards cited)
- SID No. 196 of Douglas Cty. v. City of Valley, 290 Neb. 1, 858 N.W.2d 553 (Neb. 2015) (summary judgment burden-shifting)
- Steinhausen v. HomeServices of Neb., 289 Neb. 927, 857 N.W.2d 816 (Neb. 2015) (elements of tortious interference)
- Green v. Box Butte General Hosp., 284 Neb. 243, 818 N.W.2d 589 (Neb. 2012) (standards for leave to amend pleadings)
- Linch v. Carlson, 156 Neb. 308, 56 N.W.2d 101 (Neb. 1953) (evidentiary requirements for affidavits in summary judgment context)