Thomas D. Young A/K/A T. David Young v. JP Morgan Chase Bank, N.A.
03-15-00261-CV
| Tex. App. | Sep 28, 2015Background
- Young obtained a home-equity loan in 2000 secured by a Deed of Trust; he defaulted in 2004 and JPMC (servicer) sought foreclosure in 2012.
- In April 2014 the parties executed a confidential Settlement Agreement: Young could avoid foreclosure by delivering a short payoff of $220,000 by August 1, 2014; if he failed, he agreed JPMC/Deutsche Bank would have judgment for foreclosure and he would sign an agreed foreclosure judgment by August 8, 2014.
- JPMC delivered a payoff quote and closing instructions on May 23, 2014 with an expiration of August 1, 2014; Young failed to tender funds by that date and later refused to sign the agreed judgment.
- Young requested an extension on July 29, 2014; JPMC refused. JPMC thereafter added a breach claim and sought specific performance (entry of the agreed foreclosure judgment) and judicial foreclosure based on the Note and Security Instrument.
- The trial court granted JPMC summary judgment and entered an order permitting judicial foreclosure and requiring Young to sign the agreed judgment; JPMC appeals seeking affirmance.
Issues
| Issue | Plaintiff's Argument (Young) | Defendant's Argument (JPMC) | Held |
|---|---|---|---|
| Whether summary judgment may be affirmed on independent ground of breach of the Security Instrument | Young did not address this ground on appeal; he implies the Settlement issues are controlling | JPMC: alternative ground preserved in summary judgment—breach of the Note/Security Instrument entitles judicial foreclosure | Court may affirm on the unchallenged alternate ground; summary judgment supported by proof of debt, default, notices, and continued default |
| Whether time was of the essence for the August 1, 2014 short-payoff deadline | Time was not of the essence because the Agreement did not use magic words and some post-payment timings were flexible | JPMC: entire agreement (payoff quote, payoff-letter language, cure/default and release/penalty clauses) shows the deadline was material; failure to pay by August 1 triggered foreclosure remedy | Deadline held material as a matter of law given contract terms and consequences—failure to perform by date was breach |
| Whether the trial court properly ordered specific performance (entry of agreed foreclosure judgment) | Young contends equitable relief should be barred or modified given circumstances and timing | JPMC: it fully performed (provided payoff quote), refused an unagreed extension, and is entitled to enforce bargain; no inequitable/unlawful conduct | Trial court did not abuse discretion; unclean hands defense failed—JPMC’s enforcement was not unlawful or inequitable |
| Whether unclean-hands doctrine bars specific performance | Young argues JPMC’s conduct (payoff handling/refusal to extend) is inequitable | JPMC: provided payoff timely; Young’s delay and refusal to sign were his own failures; entire-agreement prohibits unilateral modification | Court found no unclean hands; equitable relief (specific performance) appropriate |
Key Cases Cited
- Cincinnati Life Ins. Co. v. Cates, 927 S.W.2d 623 (Tex. 1996) (appellate courts may affirm on any grounds raised by movant and preserved)
- Deep Nines, Inc. v. McAfee, Inc., 246 S.W.3d 842 (Tex. App.—Dallas 2008) (contractual cure/default provisions can make time of the essence as a matter of law)
- FPL Energy, LLC v. TXU Portfolio Mgmt. Co., L.P., 426 S.W.3d 59 (Tex. 2014) (contracts must be construed to give effect to all provisions)
- Neely v. Wilson, 418 S.W.3d 52 (Tex. 2013) (standard for reviewing summary judgment; view evidence in favor of nonmovant)
- Secure Comm, Inc. v. Anderson, 31 S.W.3d 428 (Tex. App.—Austin 2000) (if judgment can rest on multiple grounds, failure to challenge one waives error)