NOTICE:
THIS DECISION DOES NOT CREATE LEGAL PRECEDENT AND MAY NOT BE CITED
EXCEPT AS AUTHORIZED BY APPLICABLE RULES.
See Ariz. R. Supreme Court 111(c); ARCAP 28(c);
Ariz. R. Crim. P. 31.24
IN THE COURT OF APPEALS
STATE OF ARIZONA
DIVISION ONE
BERNT K. LOVENBERG,
)
)
Plaintiff/Appellant, )
)
v.
)
)
DEUTSCHE BANK TRUST COMPANY,
)
AMERICA, as Trustee Residential
)
Funding Company, LLC fka
)
Residential Funding Corporation; )
SUNTRUST MORTGAGE, INC.,
)
)
Defendants/Appellees. )
__________________________________)
DIVISION ONE
FILED: 06/07/2011
RUTH A. WILLINGHAM,
CLERK
BY: DLL
1 CA-CV 10-0624 A
DEPARTMENT C
MEMORANDUM DECISION
(Not for Publication Rule 28, Arizona Rules
of Civil Appellate
Procedure)
Appeal from the Superior Court in Maricopa County
Cause No. CV2010-070070
The Honorable Harriett E. Chavez, Judge
AFFIRMED
Bernt K. Lovenberg
Appellant
Surprise
Wolfe & Wyman, LLP
Las Vegas, NV
By
Colt B. Dodrill
Attorneys for Appellee Deutsche Bank Trust Company, America
Shapiro Van Ess & Sherman, LLP
Phoenix
By
Christopher R. Perry
Jason P. Sherman
Attorneys for Appellee Suntrust Mortgage, Inc.
________________________________________________________________
O R O Z C O, Judge
¶1
Bernt
K.
Lovenberg
appeals
the
trial
court’s
order
dismissing his action for failure to state a claim upon which
relief can be granted.
For the reasons that follow, we affirm.
FACTS AND PROCEDURAL HISTORY
¶2
Deutsche Bank Trust Company, L.L.C. (DeutscheBank) is
the current holder of a promissory note issued by Lovenberg in
exchange for a home loan he used to purchase real property in
Surprise, Arizona (the Property).
against the Property.
The note is secured by a lien
Suntrust Mortgage, Inc. (SunTrust) is the
loan servicer.
¶3
After falling behind on his payments, Lovenberg entered
into a forbearance agreement with SunTrust.
Pursuant to this
agreement, Lovenberg was required to make six monthly payments of
$4,213.54.
The agreement provided that upon breach by Lovenberg,
SunTrust “may terminate this agreement and institute foreclosure
proceedings
in
accordance
with
the
security
instrument.”
Lovenberg timely made five payments, with the sixth and final
payment due on October 21, 2008.
¶4
Prior to the sixth payment required by the forbearance
agreement, SunTrust notified Lovenberg that his monthly payments
on the loan would be $3,558.97, starting November 1, 2008, and
that he had a surplus of $2,599.14 in his escrow account.
2
The
same notification also indicated that, “Due to the delinquent
status of your account we will retain your surplus.”
Lovenberg’s
next payment was not for $4,213.54 as required by the forbearance
agreement; but rather, it was for $959.83, i.e., $3,558.97 less
the amount of surplus in escrow.1
¶5
SunTrust returned the sixth payment, stating that it
was insufficient, and requested payment of the full balance of
the loan, which exceeded thirty-five thousand dollars.
Lovenberg
did not contest the foreclosure proceedings and trustee sale that
ensued
after
his
non-payment
and
the
Property
was
sold
to
DeutscheBank.
¶6
Lovenberg sued DeutscheBank and SunTrust (collectively,
the Defendants), for breach of contract and implied covenant of
good faith and fair dealing.2
action
with
prejudice
under
The trial court dismissed the
Arizona
Rule
of
Civil
Procedure
12(b)6 for failure to state a claim upon which relief can be
granted.
¶7
Lovenberg timely appealed and we have jurisdiction in
accordance
with
Article
6,
Section
the
Arizona
The letter sent by SunTrust rejecting this
indicates that Lovenberg actually tendered $974.59.
payment
1
2
9,
of
Lovenberg’s second claim for relief was amended from lack
of good faith negotiation to breach of the implied covenant of
good faith and fair dealing.
3
Constitution, and Arizona Revised Statutes (A.R.S.) section 122101.B (2003).
DISCUSSION
¶8
The trial court dismissed Lovenberg’s action because
Lovenberg
failed
to
make
the
sixth
payment
required
by
the
forbearance agreement, which resulted in SunTrust’s commencing
foreclosure
foreclosure
proceedings.
proceedings
Lovenberg
by
timely
did
not
seeking
an
contest
injunction,
the
and
accordingly waived all of his defenses pursuant to A.R.S. § 33811.C (2007).
¶9
“We review an order granting a motion to dismiss for
abuse of discretion, and review issues of law, including issues
of statutory interpretation, de novo.”
Ariz.
279,
citations
281,
¶
omitted).
11,
130
However,
P.3d
Dressler v. Morrison, 212
978,
“[i]f
a
980
(2006)
complaint
is
(internal
facially
sufficient but unpled facts establish a legal bar to relief, then
the appropriate motion is under Rule 56.”
Moretto v. Samaritan
Health Sys., 190 Ariz. 343, 346, 947 P.2d 917, 920 (App. 1997).
That
is,
“reliance
on
evidence
extrinsic
to
the
pleadings
requires the court to treat the motion to dismiss as a motion for
summary judgment.”
Dube v. Likins, 216 Ariz. 406, 417 n.2, ¶ 34,
167 P.3d 93, 104 n.2 (App. 2007); accord Blanchard v. Show Low
Planning and Zoning Comm’n, 196 Ariz. 114, 117, ¶ 11, 993 P.2d
1078, 1081 (App. 1999) (“Because the trial court in considering
4
the motion to dismiss heard evidence extrinsic to the complaint,
we
treat
this
judgment.”).
motion
to
dismiss
as
a
motion
for
summary
Because the trial court relied on facts outside the
complaint, we treat the motion to dismiss as a motion for summary
judgment.
¶10
“A motion for summary judgment should be granted if
‘there is no genuine issue as to any material fact and . . . the
moving party is entitled to judgment as a matter of law.’”
Smith
v. CIGNA HealthPlan of Ariz., 203 Ariz. 173, 176, ¶ 8, 52 P.3d
205, 208 (App. 2002) (quoting Ariz. R. Civ. P. 56(c)).
“We
review de novo a grant of summary judgment, viewing the evidence
and reasonable inferences in the light most favorable to the
party opposing the motion.”
Andrews v. Blake, 205 Ariz. 236,
240, ¶ 12, 69 P.3d 7, 11 (2003); accord Blanchard, 196 Ariz. at
117,
¶
11,
993
P.2d
at
1081
(“we
view
all
facts
and
the
reasonable inferences therefrom in the light most favorable to
the party against whom the judgment was entered”).
We also
determine “whether the trial court erred in application of the
law.”
Guo v. Maricopa Cnty. Med. Ctr., 196 Ariz. 11, 15, ¶ 16,
992 P.2d 11, 15 (App. 1999).
¶11
In
his
opening
brief,
Lovenberg
argues
that:
(1)
SunTrust breached the forbearance agreement by refusing his sixth
payment
required
by
the
forbearance
agreement
and
then
foreclosing on the Property; (2) SunTrust breached the implied
5
covenant of good faith and fair dealing by refusing to modify the
terms
of
the
loan;
and
(3)
due
to
SunTrust’s
conduct,
DeutscheBank should be compelled to sell the Property back to
Lovenberg for a price equal to its fair market value.
¶12
Lovenberg
does
not
cite
to
any
legal
authority
support of his arguments, which are accordingly waived.
in
See
ARCAP 13(a)6. (a brief shall contain arguments with citations to
authorities,
statutes,
and
parts
of
the
record
relied
upon);
Cullum v. Cullum, 215 Ariz. 352, 355 n.5, ¶ 14, 160 P.3d 231, 234
n.5 (App. 2007) (appellate courts will not consider arguments
posited without authority).
Nevertheless, because we prefer to
decide cases on the merits, in the exercise of our discretion we
choose to decide this case on the merits.
See Clemens v. Clark,
101 Ariz. 413, 414, 420 P.2d 284, 285 (1966) (“we remain inclined
to decide cases on their merits”).
Because the trial court’s
dismissal is predicated on application of A.R.S. § 33-811, which
is a question of law, we review it de novo.
See Dressler, 212
Ariz. at 281, ¶ 11, 130 P.3d at 980.
¶13
“In
interpreting
a
statute,
language of the statute itself.”
we
first
look
to
the
Lincoln v. Holt, 215 Ariz. 21,
24, ¶ 7, 156 P.3d 438, 441 (App. 2007) (citation and quotation
marks omitted).
“Words are given their ordinary meaning unless
the context of the statute requires otherwise.”
HCZ Constr.,
Inc. v. First Franklin Fin. Corp., 199 Ariz. 361, 364, ¶ 10, 18
6
P.3d 155, 158 (App. 2001).
“[A] statute should be construed in
conjunction with other statutes that relate to the same subject
or purpose . . . .”
Johnson v. Mohave Cnty., 206 Ariz. 330, 333,
¶ 11, 78 P.3d 1051, 1054 (App. 2003).
“In construing statutes we
give full effect to the intent of the lawmaker, and each word,
phrase, clause and sentence must be given meaning so that no part
will be void, inert, redundant or trivial.”
at
24,
¶
9,
156
P.3d
at
441
(citation
Lincoln, 215 Ariz.
and
quotation
marks
omitted); accord Mejak v. Granville, 212 Ariz. 555, 557, ¶ 9, 136
P.3d 874, 876 (2006) (“We must interpret the statute so that no
provision is rendered meaningless, insignificant, or void.”).
¶14
In part, A.R.S. § 33-811.C states that “[t]he trustor .
. . shall waive all defenses and objections to the sale not
raised in an action that results in the issuance of a court order
granting [injunction] entered before . . . the last business day
before
the
scheduled
date
of
the
sale.”
(Emphasis
added.)
Additionally, § 33-811.B reads, in part:
The
trustee's
deed
shall
raise
the
presumption
of
compliance
with
the
requirements of the deed of trust and this
chapter relating to the exercise of the
power of sale and the sale of the trust
property. . . . A trustee's deed shall
constitute
conclusive
evidence
of
the
meeting of those requirements in favor of
purchasers . . . without actual notice.
¶15
A
plain
reading
of
§
33-811.C
implies
that
any
objection to a trustee sale is waived unless an injunction is
7
sought prior to the sale.
Moreover, § 33-811.B implies that
after a trustee sale, all requirements of the sale are presumed
to have been conclusively met in favor of the purchaser, unless
the purchaser had actual notice of a defect.
See Sec. Sav. &
Loan Ass’n v. Milton, 171 Ariz. 75, 76, 828 P.2d 1216, 1217 (App.
1991)
(precluding
examination
into
the
merits
of
appellant’s
trustee sale challenge based on the presumption contained within
A.R.S. § 33-811); Triano v. First Am. Title Ins. Co. of Ariz.,
131 Ariz. 581, 583, 643 P.2d 26, 28 (App. 1982) (“issuance of the
trustee's deed to the appellees-purchasers is conclusive evidence
that the statutory requirements were satisfied”).
¶16
It follows that the trustee sale is intended to be
final once completed, regardless of any alleged defect, unless
the purchaser had actual knowledge of such defect.
Accordingly,
in order to challenge a trustee sale on appeal, the trustor must
have first sought to enjoin the sale prior to its completion.
To
hold otherwise would render the language pertaining to injunction
in § 33-811.C a practical nullity.
¶17
In this case, it is undisputed that Lovenberg did not
seek, nor did he obtain an injunction of the trustee sale.
In
fact, Lovenberg states in his opening brief that he “does not
challenge” the trustee sale, “but accepts it.”
His complaint
states that the trustee sale was a “natural, legal and . . .
8
unavoidable
consequence.”
Thus,
Lovenberg
has
waived
all
objections and defenses to the trustee sale.
¶18
Nevertheless, though he does not allege there was a
defect, Lovenberg’s claims for relief are essentially objections
to the trustee sale because the relief sought, i.e., title to the
Property, is what Lovenberg would be entitled to had he prevailed
on a trustee sale challenge.
That is, but for the facts pleaded
by Lovenberg supporting the claims for relief alleged in his
complaint, there would not have been a trustee sale; Lovenberg’s
success on the merits of his claims would defeat the grounds for
having the trustee sale in the first place.
court
properly
held
that
Lovenberg’s
Thus, the trial
complaint
failed
to
substantiate a genuine issue of material fact because, by failing
to seek injunction prior to the sale, Lovenberg waived any and
all objections to the trustee sale, and Defendants are entitled
to judgment as a matter of law.
9
CONCLUSION
¶19
For the foregoing reasons, the trial court’s order of
dismissal is affirmed.
appellate
costs
upon
The Defendants are entitled to their
compliance
with
Arizona
Rule
of
Civil
Appellate Procedure 21.
/S/
___________________________________
PATRICIA A. OROZCO, Presiding Judge
CONCURRING:
/S/
____________________________________
DONN KESSLER, Judge
/S/
____________________________________
MICHAEL J. BROWN, Judge
10
