Wilmington Trust, National Ass'n v. Blizzard
702 F. App'x 214
| 5th Cir. | 2017Background
- Roy Blizzard signed a Texas Home Equity Adjustable Rate Note for $196,000 in 2007; Gloria Blizzard did not sign the Note but signed the Deed of Trust securing the loan.
- Roy later defaulted; he and (an allegedly forged-signature) Gloria appear on a Modification Agreement that lowered rate and payments; Gloria alleges her signature on the modification was forged.
- HomEq Servicing sent two certified notices of default/acceleration in 2010 to Roy’s last known Austin address (one addressed to Gloria), not the Cedar Park property address.
- Wilmington Trust eventually became holder/beneficiary, sued in 2015 to foreclose; default judgment entered against Roy; Wilmington moved for summary judgment against Gloria, which the district court granted.
- Gloria appealed, arguing (1) she never validly consented to a homestead lien because she didn’t sign the Note or the modification (forgery), and (2) she did not receive adequate notice of default because notices were sent to the Austin address and referenced the possibly-void modification.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Validity of homestead lien | Wilmington: Gloria voluntarily consented by signing the Deed of Trust, satisfying Tex. Const. art. XVI §50(a)(6)(A) | Gloria: Lien invalid because she didn’t sign the Note and her signature on the Modification was forged | Court: Deed of Trust signature alone establishes voluntary homestead lien; lien valid |
| Effect of alleged forgery on Modification Agreement | Wilmington: Modification merely restructured existing loan (lower rate/payments), not a new extension of credit, so §50(a)(6)(A) spousal consent was not required | Gloria: Forged signature voids the Modification, so consent and notice referencing it are invalid | Court: Modification was not a new extension of credit under Sims; alleged forgery immaterial to lien/enforceability |
| Notice of default under Texas law | Wilmington: Notices sent by certified mail to borrower’s last known address satisfied constructive-notice requirement (Tex. Prop. Code §51.002) | Gloria: Notices were sent to wrong address (Austin) and referenced a potentially void modification, so notice was inadequate | Court: Constructive notice sufficed; Deed of Trust authorized notice rules, Roy admitted receipt, Wilmington met statutory notice obligations |
| Whether references to Modification void notice | Wilmington: Because modification is valid for purposes of restructuring, referencing it did not invalidate notice | Gloria: References to void modification rendered notice defective | Court: Since modification was not void, the notices were valid and referencing it did not defeat notice |
Key Cases Cited
- In re Katrina Canal Breaches Litig., 495 F.3d 191 (5th Cir.) (summary judgment standard and evidence-viewing rule)
- Anderson v. Liberty Lobby, Inc., 477 U.S. 242 (U.S.) (standard for genuine issue of material fact at summary judgment)
- Sims v. Carrington Mortg. Servs., L.L.C., 440 S.W.3d 10 (Tex. 2014) (distinguishes loan restructuring that is not a new extension of credit under §50)
- Puig v. Citibank, N.A., [citation="514 F. App'x 483"] (5th Cir.) (owner and non-maker spouse signatures satisfy §50 requirements)
- Robinson v. Wells Fargo Bank, N.A., [citation="576 F. App'x 358"] (5th Cir.) (constructive notice via notice to shared/last known address suffices)
- WTFO, Inc. v. Braithwaite, 899 S.W.2d 709 (Tex. App.—Dallas) (constructive notice principles under Texas law)