James M. Perry v. Federal National Mortgage Association

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REL: 06/29/2012 Notice: T h i s o p i n i o n i s s u b j e c t t o f o r m a l r e v i s i o n b e f o r e p u b l i c a t i o n i n t h e advance s h e e t s o f Southern R e p o r t e r . R e a d e r s a r e r e q u e s t e d t o n o t i f y t h e Reporter o f Decisions, Alabama A p p e l l a t e C o u r t s , 300 D e x t e r A v e n u e , M o n t g o m e r y , A l a b a m a 3 6 1 0 4 - 3 7 4 1 ((334) 2 2 9 - 0 6 4 9 ) , o f a n y t y p o g r a p h i c a l o r o t h e r e r r o r s , i n o r d e r t h a t c o r r e c t i o n s may b e made b e f o r e t h e o p i n i o n i s p r i n t e d i n Southern R e p o r t e r . ALABAMA COURT OF CIVIL APPEALS OCTOBER TERM, 2011-2012 2100235 James M. Perry v. F e d e r a l N a t i o n a l Mortgage A s s o c i a t i o n Appeal from Shelby C i r c u i t (CV-09-900606) Court On S e c o n d A p p l i c a t i o n f o r R e h e a r i n g PITTMAN, This the Judge. court's opinion o f M a r c h 9, 2 0 1 2 , i s w i t h d r a w n , a n d following i ss u b s t i t u t e d therefor. 2100235 James M. Perry appeals f r o m a summary j u d g m e n t i n favor o f t h e F e d e r a l N a t i o n a l M o r t g a g e A s s o c i a t i o n ( " F a n n i e Mae") i n an e j e c t m e n t action. We Facts Perry RBMG, obtained Inc., to executed and P r o c e d u r a l a the loan purchase a promissory securing affirm. i n the home. a amount On note i n favor in note History favor of August I n c . ("MERS"), lender RBMG. The and times, subsequently Perry made t h e p a y m e n t s until work-related accident. in his making h i s mortgage In support submitted had sent listed on of the mortgage November 2007, income and began 2003, a he mortgage Electronic nominee were, at f o r the different to due he on was Perry have the mortgage injured i n a experienced difficulty a in payments. i t s summary-judgment and the motion, Fannie t h a t on J u l y 16, 2008, a notice-of-default letter note when A f t e r the injury, evidence i n d i c a t i n g the as from t r a n s f e r r e d t o EverHome M o r t g a g e Company indebtedness reduction 12, Mortgage Systems, ("EverHome"). $144,433 o f RBMG a n d Registrations note of to Perry mortgage. opposition to the motion, Perry submitted 2 In at the EverHome address h i s response an a f f i d a v i t Mae in stating 2100235 t h a t he had contacted modification mitigation 2009, or "work-out" program. EverHome EverHome i n an e f f o r t t o o b t a i n plan Between and Perry through July were in 23, a loan- EverHome's 2008, contact and loss- August concerning 4, loss- m i t i g a t i o n a l t e r n a t i v e s t o f o r e c l o s u r e , and EverHome a g r e e d t o suspend Perry's A u g u s t 1, was mortgage payments f o r three 2008, and never EverHome able declined 2008. bring to measures because his e n d i n g N o v e m b e r 1, a months, to his loan consider i t concluded to any that Perry, current further Perry's beginning however, status, and loss-mitigation expenses exceeded income. On July notified 2, Perry accelerating 2009, via the an a attorney mailed maturity date retained letter of the that loan by EverHome EverHome and was commencing foreclosure proceedings, with a foreclosure sale scheduled for A u g u s t 4, notice to 2009. be EverHome as It its The l e t t e r enclosed published the in assignee i s undisputed that the of on i n t e r e s t i n the p r o p e r t y deed; t h a t the notices of the a copy of the newspaper. the notice named mortgage. J u l y 6, 2009, EverHome t o F a n n i e Mae foreclosure 3 The foreclosure by conveyed special warranty s a l e were published 2100235 on July 8, Reporter; mortgage July and 15, and July that on July t o EverHome. At 2009, day, possession assignment both was EverHome's of the On A u g u s t warranty Shelby the p r o p e r t y . sent On and the the Perry assigned sale on the August Perry 4, The demand for 21, August a 2009, the the s p e c i a l w a r r a n t y deed were County after Probate the 2 0 0 9 , F a n n i e Mae from EverHome F a n n i e Mae deed and and Office; the deed assignment. f i l e d a complaint seeking to eject alleging i t s own p r o p e r t y because, foreclosure claimed, had Perry from a t t a c h e d t o the c o m p l a i n t EverHome's special a n s w e r e d a n d d e n i e d t h a t F a n n i e Mae from MERS County t h e owner o f t h e p r o p e r t y by v i r t u e o f i t s s p e c i a l deed foreclosure attorney seconds 17, 2009, Shelby p r o p e r t y f o r $137,896.50. property. i n the r e c o r d e d two t h a t i t was the i n the foreclosure of the mortgage and recorded 2009, 15, the EverHome p u r c h a s e d same 22, he deed. Perry had the r i g h t t o e j e c t claimed, deed were v o i d been warranty as "defective the foreclosure a consequence notice and a of him sale what, defective sale." Following judgment. discovery, Fannie Mae In support of t h a t motion, 4 moved F a n n i e Mae for a summary submitted the 2100235 note, t h e mortgage, EverHome's foreclosure deed, i t s s p e c i a l w a r r a n t y deed, a n d t h e a f f i d a v i t o f N i k Fox, o f EverHome's books a n d r e c o r d s stated that Perry's set he loan forth had reviewed EverHome's a n d t h a t he h a d p e r s o n a l i n h i saffidavit. documents, relating to Perry's records knowledge He a u t h e n t i c a t e d including the series own custodian loan. Fox concerning of the facts the pertinent of loss-mitigation letters t h a t EverHome h a d s e n t t o P e r r y a n d t h e n o t i c e - o f - a c c e l e r a t i o n and demand-for-possession l e t t e r s had sent Perry t o Perry. With had executed authenticated stamped w i t h respect i n favor EverHome's t h a t a t t o r n e y s f o r EverHome t o the promissory o f RBMG o n A u g u s t copy o f t h e note, the f o l l o w i n g preprinted blank "Pay note that 12, 2003, F o x which had been indorsement: t o The Order o f Without Recourse [illegible signature] Senior Vice President RBMG, I n c . " Fox note averred that EverHome h a d " a c q u i r e d on o r a b o u t a i n the J u l y 2, 2 0 0 7 . " Perry i t s interest filed response i n opposition t o Fannie Mae's s u m m a r y - j u d g m e n t m o t i o n , a t t a c h i n g , among o t h e r m a t e r i a l s , h i s own affidavit and arguing that 5 the foreclosure sale andt h e 2100235 foreclosure deed were void f o r the f o l l o w i n g reasons: EverHome d i d n o t have t h e r i g h t under t h e mortgage assignee because, o f t h e mortgage (1) t o e x e r c i s e t h e power o f s a l e Perry when said, i t was i t commenced not the the foreclosure proceedings; (2) E v e r H o m e h a d f a i l e d t o c o m p l y w i t h t h e n o t i c e requirements i n t h e mortgage failed § t o comply w i t h 35-10-13, Ala. Code instrument; (3) E v e r H o m e h a d the statutory notice 1975, because, requirements Perry said, of the f i r s t f o r e c l o s u r e n o t i c e p u b l i s h e d i n t h e n e w s p a p e r o n J u l y 8, 2 0 0 9 , reflected that when, i n fact, until July t h e mortgage its h a d been MERS d i d n o t a s s i g n 15, 2009; a underbidding sham deficiency; the value and j u d g m e n t m o t i o n was n o t s u p p o r t e d Rule 56, A l a . R. Civ. (6) F a n n i e Mae's on Perry t o s t a t e how o r w h e n E v e r H o m e h a d o b t a i n e d had executed 6 was and summary- by a d m i s s i b l e evidence under failed that Perry with duty by of the property Specifically, not based sale i t s fiduciary affidavit t h e note t o EverHome t o comply Fox's in was P. t o EverHome (5) t h e f o r e c l o s u r e b e c a u s e EverHome h a d b r e a c h e d intentionally creating t h e mortgage (4) E v e r H o m e h a d f a i l e d l o s s - m i t i g a t i o n program; wrongful assigned personal i n favor argued knowledge that and an i n t e r e s t o f RBMG. 2100235 F a n n i e Mae f i l e d strike a portion of a r e p l y t o P e r r y ' s r e s p o n s e a n d moved t o Perry's affidavit. The trial court g r a n t e d t h e m o t i o n t o s t r i k e a n d e n t e r e d a summary j u d g m e n t i n favor of reasons amend, Fannie Mae on August f o r i t sdecision. or vacate 24, Perry t h e judgment 2010, filed on court denied P e r r y ' s postjudgment 2010, and P e r r y supreme court court pursuant appealed subsequently a motion September trial timely setting 22, motion t o A l a . Code 1975, § to alter, 2010. The on O c t o b e r 29, 9, on D e c e m b e r transferred out the The 2010. the appeal to this 12-2-7(6). Standard o f Review Appellate parte Ballew, summary review 771 judgment o f a summary So. 2d i s t o be material fact exists judgment as a m a t t e r 1040 judgment (Ala. granted of law. Rule 2000). when and t h e moving i s de n o v o . no party A motion genuine fact law." "that and t h a t Rule there [ i t ] i s no genuine i s entitled 56(c)(3); issue t o a judgment see Lee v. C i t y 7 as of to a A l a . R. C i v . P. A p a r t y m o v i n g f o r a s u m m a r y j u d g m e n t m u s t make a p r i m a showing for a issue i s entitled 56(c)(3), Ex t o any facie material as a m a t t e r o f Gadsden, of 592 S o . 2 d 2100235 1036, 1038 burden then I f the movant meets t h i s b u r d e n , shifts to the f a c i e showing prima 2d ( A l a . 1992). by 'substantial evidence.'" at 1038 evidence (footnote of such nonmovant omitted). weight and to rebut the "the movant's Lee, 592 " [ S ] u b s t a n t i a l evidence q u a l i t y that fair-minded Life of the f a c t sought Assurance 1989); see I. A l a . Code Perry defective party Florida, 1975, when 547 So. that LP, 2d EverHome was the the the 870 , Founders 87 1 Power o f foreclosure not the foreclosure (Ala. Sale sale assignee was of the proceedings. A f o r e c l o s u r e p r o c e e d i n g s when i t a c c e l e r a t e s date of the indebtedness foreclosure West v. the 12-21-12(d). to Exercise i t initiated "initiates" Servicing, § contends because the maturity a of EverHome's R i g h t A. mortgage Co. t o be p r o v e d . " is persons i n the e x e r c i s e of i m p a r t i a l judgment can r e a s o n a b l y i n f e r existence So. sale. [Ms. See 2100245, Sturdivant December ___ , ___ ( A l a . C i v . App. 2011). attorney notified that maturity date Perry of the and p u b l i s h e s On 8 16, July EverHome indebtedness v. and 2, was BAC 2011] 2009, notice Home Loans So. 3d EverHome's accelerating initiating of the foreclosure 2100235 proceedings; of o n J u l y 8, 2 0 0 9 , E v e r h o m e a foreclosure sale 15, scheduled 2 0 0 9 , MERS a s s i g n e d first published notice f o r August t h e mortgage 4, 2 0 0 9 ; t o EverHome. In S t u r d i v a n t , supra, a m a j o r i t y o f t h i s because the foreclosing entity standing to Sturdivant, not entity h a d no prosecute i t s ejectment i n this case. Fannie Mae judgment motion, testimony indicating EverHome i n i t i a t e d to ofthe initiated, the foreclose action. In support submitted t h a t on J u l y a n d no Unlike i n 2, 2 0 0 7 , o f i t s summaryFox's affidavit two y e a r s the foreclosure proceedings, t h epromissory o f RBMG i n 2 0 0 3 . note authority were that, t h e t i m i n g o f t h e assignment o f t h e mortgage i s determinative acquired court held was n o t t h e a s s i g n e e m o r t g a g e when t h e f o r e c l o s u r e p r o c e e d i n g s foreclosing on J u l y before EverHome h a d note t h a t Perry had executed i n favor The p a r t i e s do n o t d i s p u t e t h e f a c t t h a t t h e was a n e g o t i a b l e i n s t r u m e n t , i . e . ,that i t represented P e r r y ' s u n c o n d i t i o n a l p r o m i s e t o p a y RBMG a f i x e d sum o f m o n e y at a d e f i n i t e time, without r e q u i r i n g any other undertaking by Perry. See A l a . Code 1 9 7 5 , § 7-3-104. The p a r t i e s a l s o do n o t d i s p u t e t h a t E v e r H o m e b e c a m e , a t some p o i n t , a " h o l d e r " o f the note. A holder i s entitled 9 t o enforce t h e terms of a 2100235 negotiable dispute If instrument. concerns EverHome the A l a . Code when EverHome became a holder foreclosure proceedings authorized to exercise mortgage by v i r t u e Section 1975, became t h e power before 2009, of sale o f § 3 5 - 1 0 - 1 2 , A l a . Code 35-10-12 p r o v i d e s , 7-3-301. a holder of the note in July § then The of the note. i t initiated EverHome contained was i n the 1975. i n pertinent part, that "[w]here a power t o s e l l l a n d s i s g i v e n i n any m o r t g a g e , t h e p o w e r i s p a r t o f t h e s e c u r i t y a n d may be executed by any person, or the personal r e p r e s e n t a t i v e o f a n y p e r s o n who, b y a s s i g n m e n t o r otherwise, becomes entitled t o t h e money thus secured." (Emphasis added.) So. 851, 851 (1911), at a l l necessary enable I n H a r t o n v. L i t t l e , 176 A l a . 2 6 7 , 2 7 0 , 57 o u r supreme c o u r t h e l d t h a t t h a t a m o r t g a g e d e e d be a s s i g n e d t h e owner "[i]t i s not to t o f o r e c l o s e u n d e r a power of the debt i n order of sale." "The p o w e r o f s a l e i s a p a r t o f t h e s e c u r i t y , a n d may b e e x e r c i s e d b y a n a s s i g n e e , o r a n y p e r s o n who i s e n t i t l e d t o the mortgage debt. And a t r a n s f e r o f t h e d e b t , by w r i t i n g o r b y p a r o l , i s i n e q u i t y an assignment of the mortgage." 1 7 6 A l a . a t 2 7 0 , 57 also given A l a . Code 1975, So. a t 851-52 § 8-5-24 (citations ("The omitted). t r a n s f e r of a ... See note f o r t h e p u r c h a s e money o f l a n d s , w h e t h e r t h e t r a n s f e r be 10 2100235 by delivery without the merely or i n writing, expressed r e c o u r s e on t h e t r a n s f e r o r , lien of Restatement (stating t h e vendor (Third) that of passes or to the transferee the lands."). o f P r o p e r t y : Mortgages "[a] transfer t o be w i t h See generally § 5.4(a) o f an o b l i g a t i o n secured (1997) by a mortgage a l s o t r a n s f e r s t h emortgage u n l e s s t h ep a r t i e s t o t h e transfer agree Fox, Perry's otherwise"). t h e c u s t o d i a n o f EverHome's loan, identified EverHome's b o r e a b l a n k i n d o r s e m e n t b y RBMG. a party Code to transfer 1975, § a note 7-3-205(b) records copy relating of the note, A blank indorsement merely by possession. ("When indorsed i n to which allows See A l a . blank, an i n s t r u m e n t b e c o m e s p a y a b l e t o b e a r e r a n d may b e n e g o t i a t e d b y transfer of possession alone u n t i l a l s o § 7-3-201(b). averred on o r about B. on that which specially A l t h o u g h t h e i n d o r s e m e n t was u n d a t e d , F o x EverHome h a d " a c q u i r e d July indorsed."); see i t s interest i n t h e note 2, 2 0 0 7 . " Perry argues EverHome t h a t Fox's acquired R u l e 5 6 ( e ) , A l a . R. C i v . P. statement t h e note regarding was i n a d m i s s i b l e That r u l e p r o v i d e s , part: 11 the date under i n pertinent 2100235 " S u p p o r t i n g a n d o p p o s i n g a f f i d a v i t s s h a l l b e made on p e r s o n a l k n o w l e d g e , s h a l l s e t f o r t h s u c h f a c t s as w o u l d be admissible i n evidence, and shall show affirmatively that the affiant i s competent to testify t o the m a t t e r s s t a t e d t h e r e i n . Sworn or certified copies of a l l papers or p a r t s thereof referred to i n an affidavit shall be attached t h e r e t o or served t h e r e w i t h . " Fox's a f f i d a v i t stated, in part: " I n my p r e s e n t p o s i t i o n , I h a v e d i r e c t a c c e s s t o t h e books and records of [EverHome] regarding the a c c o u n t w h i c h forms t h e b a s i s of t h i s a c t i o n and am a custodian of s a i d books and records. I have p e r s o n a l knowledge of the f a c t s s e t f o r t h i n t h i s a f f i d a v i t and I have r e v i e w e d s a i d r e l e v a n t b u s i n e s s b o o k s a n d r e c o r d s . ... I am c o m p e t e n t t o t e s t i f y t o the matters set f o r t h i n t h i s a f f i d a v i t , which are b a s e d u p o n my r e v i e w o f s a i d b o o k s a n d r e c o r d s and my p e r s o n a l k n o w l e d g e . " Perry maintains t h a t Fox c o u l d not have had personal o f t h e d a t e on w h i c h p o s s e s s i o n of the note had to knowledge been i n v o l v e d i n the EverHome u n l e s s "transaction" or (a) (b) documenting that Fox Fox had had reviewed "transaction." With (b) o f h i s l a c k - o f - p e r s o n a l - k n o w l e d g e that, i f Fox had reviewed and " t r a n s a c t i o n " by the that attached then to Fox's record record respect delivery of EverHome to a l t e r n a t i v e argument, P e r r y insists r e l i e d upon a r e c o r d o f EverHome documenting the note, a been d e l i v e r e d w h i c h EverHome had should affidavit. 12 have been, but acquired was not, 2100235 Initially, allows a party we note that because a blank indorsement t o t r a n s f e r a note by possession alone, i t i s u n l i k e l y t h a t any f o r m a l , documentable " d e l i v e r y t r a n s a c t i o n " occurred. files E v e r H o m e may, h o w e v e r , o r on i t s b o o k s indicating h a v e made a n e n t r y that the note, a i nits valuable f i n a n c i a l a s s e t , had been r e c e i v e d and c r e d i t e d t o i t s account on a certain assertion and that date. that he h a d r e v i e w e d he h a d p e r s o n a l books and records, attach Nevertheless, aside EverHome's knowledge of possession Mae date books general and records of those ( a n d F a n n i e Mae d i d n o t how F o x h a d g a i n e d h i s of the note. Fannie the t o demonstrate) knowledge Fox's of the contents Fox d i d n o t s t a t e documentation from which EverHome that argues on Perry failed review any argument as t o a d e f e c t Perry d i d n o t move Although Perry inadmissibility on which called Fannie EverHome Mae's strike the t r i a l had acquired i n Fox's a f f i d a v i t regarding 13 because We agree. to the the a l l e g e d date and although p o r t i o n of h i s response motion for attention court's the note summary-judgment acquired to preserve the affidavit. o f Fox's testimony devoted a considerable to to had Perry i n opposition to explaining the 2100235 basis for his objection, the Supreme Court of Alabama r e c e n t l y made i t c l e a r t h a t " a p a r t y m u s t move t h e t r i a l to s t r i k e P. An any e v i d e n c e objection sufficient." 1101171, (emphasis C. 16, parte February added; 2012] that to the Ex Citing 10, Mae inadmissible So. B y r d v. M o r E q u i t y , 3d submitted whether EverHome mortgage by virtue the assignment 3d alone i s not Affairs, , [Ms. ( A l a . 2012) had I n c . , [Ms. 2 1 0 0 7 3 4 , contradictory 2012), the Perry evidence t o e x e r c i s e t h e power Perry maintains that a bearer evidence ( A l a . C i v . App. submissions c r e a t e d a genuine note, 5 6 ( e ) , A l a . R. C i v . Secretary of Veterans 2012] EverHome became e n t i t l e d mortgage. Rule court footnote omitted). So. Fannie that violates has as argues t o when of sale F a n n i e M a e ' s own March i n the evidentiary issue of material fact regarding right to foreclose o f EverHome's p h y s i c a l i n s t r u m e n t , on July 2, on Perry's possession of the 2007, or by v i r t u e f r o m MERS o f t h e m o r t g a g e a n d n o t e on J u l y of 15, 2009. I n C o l e m a n v . BAC So. addressed 3d , Servicing, [Ms. 2 1 0 0 4 5 3 , (Ala. Civ. t h e same a r g u m e n t . We 14 June 22, App. 2012), concluded that this 2012] court t h e r e was no 2100235 conflict in the distinguishable, evidence, true v. MorEquity i s o f a summary judgment i n T h e same i s i n the present Accordingly, Mae's evidence reversal Byrd o f t h e f o r e c l o s i n g e n t i t y was n o t r e q u i r e d . favor and t h a t that case. the t r i a l that court properly EverHome, a t t h e t i m e considered Fannie i t initiated the f o r e c l o s u r e p r o c e e d i n g s o n J u l y 2, 2 0 0 9 , was t h e h o l d e r o f t h e note and was, sale i n t h e m o r t g a g e ; t h a t EverHome p e r f e c t e d 4, 2009, sale; when therefore, i t purchased and t h a t t h e e q u i t a b l e operated to perfect t i t l e v. Lawyers App. entitled Title to exercise t h e power title the property at the doctrine Corp., on A u g u s t foreclosure of after-acquired i n F a n n i e Mae i m m e d i a t e l y . Insurance 985 S o . 2 d 434 of title See J e t t (Ala.C i v . 2007): "'"In no S t a t e perhaps has t h e r u l e been more r i g i d l y adhered t o than i n t h i s , ' t h a t when one s e l l s l a n d t o w h i c h h e h a s no r i g h t , w i t h w a r r a n t y o f t i t l e , a n d he a f t e r w a r d s a c q u i r e s a g o o d t i t l e , it passes i n s t a n t l y t o h i s vendee, a n d he i s e s t o p p e d f r o m d e n y i n g t h a t he h a d no r i g h t a t t h e t i m e o f t h e s a l e . ' ..."'" 985 S o . 2 d a t 438 380 ( A l a . 1985), Ala. (quoting T u r n e r v . L a s s i t e r , 484 S o . 2 d 3 7 8 , quoting i n turn 4 1 2 , 4 1 3 , 19 S o . 8 5 1 , 8 5 1 15 Doolittle (1895)). v. R o b e r t s o n , 109 2100235 II. Perry were in Separation contends initially favor favor of of that MERS, as and lien. raise argument that the the for the note having that the trial postjudgment enforceable and mortgage Agard, has 444 were B.R. previously Servicing, (Ala. Civ. [Ms. App. separated." 231, 246 rejected On (Bankr. the 2100453, Contractual A. Perry 22, and lien appeal, Perry had The one- "[t]he the cites E.D.N.Y. 2 0 1 1 ) . note This i n Coleman 2012] So. to record made a because in an failed Perry Statutory contends because that never Perry same a r g u m e n t June executed to authority, that that EverHome failed Notice the In re court v. 3d BAC , to he was never t r a n s f e r r e d t o EverHome as notified required, 16 Requirements foreclosure comply w i t h requirements i n the mortgage instrument. maintains executed 2012). III. defective or been court. motion plaintiff valid mortgage been maintains before the EverHome citation no and RBMG), sentence argument, w i t h o u t has Mortgage note having mortgage F a n n i e Mae in his Note and (with the nominee enforceable indicates the because separated RBMG that of the Specifically, that he sale his said, by loan had was notice Perry been paragraph 20 2100235 of the mortgage. paragraph 20 Note partial or a Security prior of That the mortgage interest Instrument) notice Perry "default to also prior paragraph 22 of argument can is unavailing specifically in be the sold Note one states that (together or more because "[t]he with times this without Borrower." contends to the that he acceleration," mortgage. was as not given required, That paragraph notice of said, by he states: " A c c e l e r a t i o n ; Remedies. Lender s h a l l give notice to Borrower prior to acceleration following B o r r o w e r ' s b r e a c h o f any c o v e n a n t o r a g r e e m e n t i n this Security Instrument. ... The notice shall s p e c i f y : (a) t h e d e f a u l t ; (b) t h e a c t i o n required t o c u r e t h e d e f a u l t ; (c) a d a t e , n o t l e s s t h a n 30 days from the date the n o t i c e i s given to Borrower, b y w h i c h t h e d e f a u l t m u s t be c u r e d ; a n d (d) that f a i l u r e t o c u r e t h e d e f a u l t on o r b e f o r e t h e d a t e s p e c i f i e d i n t h e n o t i c e may result in acceleration o f t h e sums s e c u r e d b y t h i s S e c u r i t y I n s t r u m e n t a n d s a l e of the Property. The notice shall further inform Borrower of the r i g h t to r e i n s t a t e after a c c e l e r a t i o n and t h e r i g h t t o b r i n g a c o u r t action to a s s e r t the n o n - e x i s t e n c e of a d e f a u l t or any o t h e r d e f e n s e of B o r r o w e r t o a c c e l e r a t i o n and s a l e . " Assuming, alleged defect available t h a t was without to not in Perry the deciding, the that process i n an the leading ejectment up action f o r e c l o s i n g e n t i t y but 17 assertion to of such an foreclosure is b r o u g h t by a party i s a subsequent vendee 2100235 of the foreclosure-sale provides, i n paragraph purchaser, 15, we note that the mortgage that "[a]ny notice to Borrower i n connection w i t h t h i s S e c u r i t y I n s t r u m e n t s h a l l be deemed t o h a v e b e e n g i v e n t o B o r r o w e r when m a i l e d b y f i r s t c l a s s m a i l o r when a c t u a l l y d e l i v e r e d t o B o r r o w e r ' s n o t i c e a d d r e s s i f s e n t by o t h e r means." Fox on identified July 16, a l e t t e r m a i l e d by EverHome t o P e r r y ' s 2008, that address stated: "YOUR D E F A U L T I N PAYMENT OF THE C A P T I O N E D LOAN HAS MADE I T N E C E S S A R Y FOR us t o c o n s i d e r t a k i n g l e g a l a c t i o n . In accordance w i t h the terms of the Deed/Mortgage, you a r e h e r e b y n o t i f i e d t h a t you have thirty (30) d a y s f r o m t h e d a t e o f t h i s l e t t e r t o cure the e x i s t i n g d e f a u l t . I f the breach of c o n t r a c t i s n o t c u r e d on o r b e f o r e t h e t h i r t i e t h d a y , we w i l l d e c l a r e t h e p r i n c i p a l b a l a n c e , $149,228.29, and a l l sums secured by the Deed/Mortgage due payable w i t h o u t f u r t h e r n o t i c e t o you. " I f you w i s h t o r e i n s t a t e t h e a c c o u n t , you must s e n d c e r t i f i e d f u n d s ( c a s h i e r s c h e c k o r money o r d e r ) i n t h e a m o u n t o f $ 3 , 5 3 9 . 5 2 . An a d d i t i o n a l monthly p a y m e n t m u s t b e a d d e d t o t h i s a m o u n t on y o u r n e x t due d a t e . I f you s e n d a n y amount l e s s t h a n t h e f u l l r e i n s t a t e m e n t amount as q u o t e d i n t h i s l e t t e r , we may e l e c t t o a p p l y p a r t i a l p a y m e n t t o y o u r a c c o u n t w i t h o u t w a i v i n g our r i g h t of a c c e l e r a t i o n . In the e v e n t t h a t t h e p r o p e r t y i s t e n a n t - o c c u p i e d and you f a i l t o c u r e t h e b r e a c h as r e q u i r e d by t h i s l e t t e r , t h i s i s a f o r m a l demand f o r a l l r e n t s , a p p l i c a b l e t o state statutes. "If wish to agency. y o u a r e i n n e e d o f f i n a n c i a l a d v i c e , y o u may c o n t a c t a HUD approved housing c o u n s e l i n g These agencies p r o v i d e e x p e r i e n c e d home 18 2100235 o w n e r s h i p c o u n s e l i n g a t no c h a r g e t o y o u . a g e n c y i n y o u r a r e a c a l l (809) 559-4287. For the " T h i s l e t t e r s h a l l a l s o s e r v e as n o t i c e t o you of your right to reinstate your loan after a c c e l e r a t i o n as p r o v i d e d by t h e D e e d / M o r t g a g e , and of your r i g h t to b r i n g a court a c t i o n to a s s e r t the non-existence o f t h e b r e a c h o f c o n t r a c t o r any o t h e r l e g a l defense t o a c c e l e r a t i o n or f o r e c l o s u r e . Under t h e t e r m s o f t h e D e e d / M o r t g a g e , we a r e e n t i t l e d t o collect a l l expenses allowed by law, which may include reasonable attorney f e e s and the related c o s t s o f any l e g a l proceedings. "Sincerely, EverHome M o r t g a g e Company C o l l e c t i o n Department" Although Perry not dispute therefore, issue was of denied that failed material t h a t he EverHome to had had received sent e s t a b l i s h the fact sent. See Redman v . 634 (Ala. regarding the letter, letter. existence whether the of he did Perry, a default Perry a l s o a r g u e s t h a t he acceleration-and-foreclosure having been sent EverHome. trial That c o u r t and to Perry argument, c a n n o t be on Home M o r t g . C o r p . , 765 genuine notice 1999). 630, Federal the d i d not letter J u l y 2, however, receive that r a i s e d f o r the 19 Fox 2009, by was not the 2d notice-of- identified an attorney presented first So. t i m e on to as for the appeal. 2100235 See W h i t e Sands G r o u p , L.L.C. 1057 Perry defective contends because requirements provides time, 2009, until E v e r H o m e was foreclosure Code 1042, null 1975. said that sale, (Emphasis to comply "terms of with mortgage i n fact, the assignment 2009. Perry 15, had p r o c e e d i n g s were i n i t i a t e d , which section must with a published the statutory assigned t o EverHome argues that, because at the time the the foreclosure argument to d i d not sale on § 3 5 - 1 0 - 9 , A l a . provides: " A l l s a l e s o f r e a l e s t a t e , made u n d e r p o w e r s c o n t a i n e d i n mortgages o r deeds of t r u s t c o n t r a r y t o t h e p r o v i s i o n s o f t h i s a r t i c l e , s h a l l be n u l l a n d void, notwithstanding any agreement o r s t i p u l a t i o n to the contrary." 20 give first been not the a s s i g n e e of the mortgage He b a s e s t h a t sale notice [the] s a l e " because i t the July That together t h e n o t i c e , w h i c h was failed the was added.) that and v o i d . 1975, A l a . Code sale with of stated occur t o comply terms incorrectly when, foreclosure [foreclosure] t o s e t out the EverHome failed of the property." 8, the of requirement was 998 S o . 2 d notice and insists July that 35-10-13, "[t]he place Perry EverHome in § that description on I I , LLC, ( A l a . 2008). B. the v . PRS 2100235 (Emphasis EverHome added.) was As not foreclosure previously the assignee proceedings EverHome's a u t h o r i t y to exercise upon the i t s being Little, entity that and 498, law is the 216 ( A l a . C i v . App. So. 932 clear time not negate EverHome's l e g a l the the note, money that was right dependent see Harton E v e r H o m e was ... to not mortgage, the that secured" sale. See, permitted errors mortgagor w i l l not e.g., in the to v. the by the D r a k e v. exercise notice i n v a l i d a t e an mortgagor); Richards 2005) ( i n a c c u r a t e property was located mortgagor because accurately and the that stated Farmers' R h o d e s , 155 to Bank v. P h i l l i p s , 925 initials 2d statement i n preamble of Shelby was County Murphree, 200 that did property located specify in notice 21 Ala. So. d e s c r i p t i o n of that property Sav. (1917) ( f a i l u r e legal in v. do otherwise ( 1 9 0 8 ) ( t r a n s p o s i t i o n of m o r t g a g o r ' s prejudice County); to that at did m o r t g a g e was of fact 35-10-12. not notice holder § did prejudice the entity 769 that of "entitled foreclosure notice i n the the mortgage initiated sale the prejudice 46 S o . the foreclose. sale. power of valid were thus Alabama not As was of assignee the supra. mortgage the power of discussed, not in in Chilton Ala. 574, 76 foreclosure 2100235 sale would be f o r cash d i d not p r e j u d i c e mortgagor a l t h o u g h t h e s a l e was made f o r c a s h , a n e x t e n s i o n purchasers would Granted, the significant than Nevertheless, conclusion neither inaccuracy the there that t o a t t r a c t more in errors i s nothing Perry bidders). the in of c r e d i t to notice the cases i n the record here was cited any to support was h a r m e d b y t h e i n a c c u r a c y , inaccuracy. EverHome actual Perry had been f o r a year continued to and prejudice before correspond including as sending a and the consequence was EverHome date the Perry he h a d of the h i s mortgage payments t o the notice with more above. a l l e g e d nor presented evidence i n d i c a t i n g that suffered through tend because, of the published, about a n d he his loan foreclosure up sale. C o m p a r e K e l l y v . C a r m i c h a e l , 217 A l a . 5 3 4 , 5 3 7 , 117 S o . 6 7 , 70 (1928) (noting indebtedness compromised the d e b t was that at i f any mortgagor's time mortgagor that was to foreclosure unaware pay sale mortgage would be o f t h e e n t i t y t o whom owed). IV. A. before right Perry contends Loss M i t i g a t i o n that EverHome misrepresented the foreclosure would not take place 22 so l o n g t o him as EverHome 2100235 was w o r k i n g w i t h him affidavit i n i t s l o s s - m i t i g a t i o n program. Perry's stated: " I s p o k e t o t h e m o r t g a g e company numerous t i m e s about a l o a n - m o d i f i c a t i o n or work-out p l a n through t h e i r l o s s - m i t i g a t i o n program. T h e y t o l d me they w o u l d w o r k w i t h me b u t t h e y d i d n o t f o l l o w t h r o u g h because they s o l d the loan to another mortgage company. My m o r t g a g e was t r a n s f e r r e d s e v e r a l t i m e s d u r i n g t h i s t i m e frame and I c o u l d n e v e r g e t anyone t o f o l l o w up w i t h t h e m o d i f i c a t i o n . I sent a l l the r e q u e s t e d i n f o r m a t i o n t o them; however I never heard f r o m them. I was t o l d b y t h e m t h a t t h e f o r e c l o s u r e w o u l d n o t go f o r w a r d a s l o n g a s t h e y w e r e w o r k i n g with me through the loss-mitigation program. Because of these communications w i t h the lender, I was confused about the foreclosure procedure. Further, I relied upon t h e s e communications and b e l i e v e d t h a t t h e m o r t g a g e c o m p a n y was w o r k i n g w i t h me t o h e l p me k e e p my home. T h e y d i d n o t f o l l o w up and failed t o w o r k w i t h me through the lossm i t i g a t i o n program." (Emphasis portion added.) of Fannie Perry's Mae moved t o s t r i k e affidavit on the the grounds that h e a r s a y and t h a t i t v i o l a t e d t h e S t a t u t e of F r a u d s . court correctly In granted that support of Perry's program. that, requests In each d u r i n g the to be The was trial motion, Fannie Mae f r o m EverHome t o P e r r y r e g a r d i n g considered of those i t motion. i t s summary-judgment submitted a s e r i e s of l e t t e r s emphasized letters, loss-mitigation 23 for the loss-mitigation EverHome c a u t i o n e d P e r r y process, i t would not "stop 2100235 normal default-servicing foreclosure." and d i d not agreed, in Perry efforts, d i d not deny h a v i n g s u b m i t any evidence a to writing, the identical a r g u m e n t i n C o l e m a n v. court 2012] So. 3d and received collection proceedings. , to i n d i c a t i n g that forbear postpone J u n e 22, foreclosure up BAC In including the letters EverHome efforts or addressing Servicing, ( A l a . C i v . App. [Ms. to an 2100453, 2012), stated: " A s s u m i n g t h a t a [ f o r e c l o s i n g e n t i t y ] h a d made the oral representation that [the mortgagor in default] a l l e g e d , t h a t r e p r e s e n t a t i o n would have been u n e n f o r c e a b l e under the Statute of Frauds. S e c t i o n 8 - 9 - 2 ( 7 ) , A l a . Code 1975, provides: "'In the following cases, every agreement i s v o i d u n l e s s such agreement or some n o t e o r memorandum t h e r e o f expressing the consideration is in writing and subscribed by the party t o be charged therewith or some o t h e r person by him thereunto l a w f u l l y authorized i n w r i t i n g : " ' "'(7) E v e r y agreement o r commitment t o l e n d money, d e l a y or forbear repayment t h e r e o f or to modify the p r o v i s i o n s of such an agreement or commitment except for consumer loans with a principal amount f i n a n c e d l e s s than $25,000.' " ( E m p h a s i s a d d e d . ) See D e V e n n e y v . H i l l , 918 So. 2d 106 ( A l a . 2005) ( h o l d i n g t h a t agreement whereby s e l l e r o f l a n d w o u l d f o r b e a r c o l l e c t i n g $150,000 o f 24 had this 2100235 p u r c h a s e p r i c e f o r 30 d a y s i n r e t u r n f o r a d d i t i o n a l $ 5 0 , 0 0 0 f r o m b u y e r was v o i d b e c a u s e i t was n o t i n writing). I n Holman v. C h i l d e r s b u r g Bancorporation, I n c 8 5 2 So. 2 d 691 ( A l a . 2 0 0 2 ) , o u r s u p r e m e c o u r t h e l d t h a t when a t o r t c l a i m t u r n s on an a l l e g e d agreement t h a t i s u n e n f o r c e a b l e under t h e S t a t u t e o f Frauds, t h e S t a t u t e o f Frauds a l s o bars p r o o f of t h a t agreement t o support t h e t o r t c l a i m . The cc u r t co explained that t o allow the t o r t claim would defeat the purpose o f t h e S t a t u t e o f Frauds. L i k e w i s e , we conclude that to allow a defective-foreclosure d e f e n s e t h a t i s p r e d i c a t e d upon an a l l e g e d agreement that i s unenforceable under the Statute of Frauds would also defeat the purpose of the Statute of Frauds." So. 3d a t B. In foreclosing his appellate entity specifically, 2008) . brief, i s required, 12 U.S.C. ("the A c t " ) , § Perry by the N a t i o n a l 1701-x(c)(5) and by argues regulations that Housing A c t , (effective July promulgated Department o f Housing and Urban Development a 30, by the ("HUD"), t o o f f e r l o s s - m i t i g a t i o n a l t e r n a t i v e s t o f o r e c l o s u r e f o r m o r t g a g o r s who are the i n d e f a u l t and that t h e f a i l u r e regulations wrongful Mae the and a c t i o n a b l e . " asserts argument "renders that Perry to the t r i a l t o comply w i t h foreclosure premature In i t s appellate d i d not court present -- a p p a r e n t l y 25 t h e A c t and brief, that ... Fannie particular referring only to 2100235 Perry's r e l i a n c e on regulations, the because Act, and F a n n i e Mae not to further his r e l i a n c e on the argues: "Perry's argument that [Fannie Mae] failed to demonstrate that EverHome complied with various federal regulations i s without merit. Perry cites t o no a u t h o r i t y t h a t a f a i l u r e t o c o m p l y w i t h t h o s e r e g u l a t i o n s , e v e n i f p r o v e n , w o u l d s e r v e as a b a s i s t o s e t a s i d e the f o r e c l o s u r e and d i v e s t a thirdp a r t y p u r c h a s e r of t h a t p r o p e r t y of i t s t i t l e to the property. F u r t h e r m o r e , Alabama law does not r e q u i r e an e j e c t m e n t p l a i n t i f f t o p r o v e t h a t t h e f o r e c l o s i n g e n t i t y complied with s e r v i c i n g regulations." In his reply brief, extensively argued trial was court mitigation in indicates that extent, Perry at the apprised this the that "the issue summary-judgment h e a r i n g , of the case." Perry because maintains raised judgment regulations The the trial issue, and requiring court's at was the loss- judgment least to some states: " T h e r e i s no r e q u i r e m e n t i n t h e m o r t g a g e d o c u m e n t s f o r EverHome t o engage i n l o s s - m i t i g a t i o n p r o g r a m s with Perry. Therefore, any engagement i n lossmitigation efforts by EverHome was entirely v o l u n t a r y and any c o m p l i a n c e o r n o n - c o m p l i a n c e w i t h a l o s s - m i t i g a t i o n p r o g r a m c a n n o t s e r v e as a b a s i s for v o i d i n g the f o r e c l o s u r e s a l e . " Assuming that regulatory alternative alleged Perry generally requirement to failure apprised calling foreclosure, any to comply w i t h for the loss argument trial court mitigation that of as an EverHome's such requirement c o n s t i t u t e s 26 a a 2100235 defense to an foreclosure proceeding i s precluded Servicing, (Ala. ejectment [Ms. Civ. by 2100453, App. 2012). our June In following decision 22, in 2012] C o l e m a n , we a nonjudicial Coleman So. stated v. 3d that , "[i]n absence of a s t a t u t e or c o n t r o l l i n g a u t h o r i t y from our court to the foreclosing e n t i t y to requirements action contrary, may a V. Perry he says, intentionally be raised nonjudicial The maintains because, conclude comply w i t h not following we that the EverHome the the tax same, fair assessor's Perry property at bought the said, the time property defense Sale of the for only the of property $165,000 $l70,743.67 foreclosure -- a loss-mitigation to an ejectment So. sale was 3d at defective fiduciary the duty property Perry was, approximately sale -- yet by and asserted according indebtedness $137,896.50. 27 of Price its value the supreme failure In h i s a f f i d a v i t , the of VA foreclosure the records, as a or breached underbidding market value HUD the foreclosure." Foreclosure c r e a t i n g a sham d e f i c i e n c y . that as that BAC on to the the EverHome 2100235 The strike trial that court properly portion granted of Perry's F a n n i e Mae's m o t i o n to affidavit. "'"[G]enerally the tax assessing authority's e v a l u a t i o n i s n o t r e l e v a n t when o f f e r e d t o p r o v e m a r k e t v a l u e . The r a t i o n a l e u n d e r l y i n g t h i s general exclusionary rule i s that ' i t i s notorious that properties are not assessed at anything like true value or market value.'"' Presley v. B.I.C. Constr., I n c . , 64 S o . 3 d 6 1 0 , 621 ( A l a . C i v . A p p . 2009) (quoting 2 Charles W. Gamble, McElroy's Alabama Evidence § 267.04 (5th ed. 1996)). M o r e o v e r , [ P e r r y ] d i d n o t a u t h e n t i c a t e t h e ... t a x n o t i c e a s r e q u i r e d b y R u l e 5 6 ( e ) , A l a . R. C i v . P. See B e r r y M o u n t a i n M i n i n g Co. v . A m e r i c a n R e s . I n s . C o . , 5 4 1 S o . 2 d 4, 4-5 ( A l a . 1 9 8 9 ) . " Berry v. Deutsche (Ala. C i v . App. Moreover, Bank Nat'l realized the shock fraud, "'"The at Co., 57 So. 3d bid price the claimed, general rule [foreclosure] the conscience, trickery, f o r the i t may unfairness, property amounted was t h e m a r k e t v a l u e i s that, 'where sale i s so Mt. C a r m e l E s t a t e s , 567 2002) 148 itself raise or culpable price as to a presumption of mismanagement, and aside.'"'" I n c . v. R e g i o n s B a n k , 853 So. 2d 160, (quoting So. 2 d 1329, 1333 Breen v. B a l d w i n ( A l a . 1990), 28 Cnty. quoting to of the the inadequate t h e r e f o r e be s u f f i c i e n t g r o u n d f o r s e t t i n g t h e s a l e (Ala. 142, 2010). a l m o s t 84% o f what, P e r r y property. Trust Fed. Sav. i n turn 168 Bank, Hayden v. 2100235 Smith, 216 A l a . 428, 430-31, conclude not so that the price realized low as t o shock supra (holding Estates, that bank's value, (1927)). at the foreclosure the conscience. w h i c h was 8 1 % o f a p p r a i s e d the 113 So. 2 9 3 , 295 We s a l e was C f . Mt. Carmel foreclosure-sale b i d , was n o t s o l o w a s t o s h o c k conscience). Conclusion F a n n i e Mae e s t a b l i s h e d property; therefore, i t s right the t r i a l t o eject Perry court's from t h e judgment i s due t o be affirmed. A P P L I C A T I O N GRANTED; O P I N I O N OF MARCH 9, 2 0 1 2 , WITHDRAWN; OPINION SUBSTITUTED; Bryan, Thomas, Thompson, AFFIRMED. and Moore, P.J., concurs JJ., concur. i n the result, 29 without writing.

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