Wells Fargo Bank, N. A. VS Diana L. Tonagel

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STATE OF LOL ISIANA COURT OF APPEAL FIRST CIRCUIT NUMBER 2012 CA 0380 and 2011 CW 2400 WELLS FARGO BANK N E1 VERSUS DIANA L TONAGEL Judgment Rendered JUN 0 7 2013 Appealed from the Second Twenty Judicial District Court In and for the Parish of St Tammany State of Louisiana Suit Number 2010 15088 Honorable Reginald T Badeaux Presiding Kent A Lambert Brian M Ballay Counsel for Plaintiff Appellant Wells Fargo Bank N A Roy C Cheatwood Laura M Williams New Orleans LA and Charles H Heck Jr Monroe LA Diana L Tonagel Appellee Defendant Pro Se Mandeville LA BEFORE GUIDRY CRAIN AND THERIOT JJ I GUIDRY J Wells Fargo Bank N Wells Fargo appeals from a judgment of the trial A court confirming a default judgmeait in favor of Diana Tonagal and ordering that the Order of Seizure entered on August 12 2010 be acated and that the seized property be returned to Tonagel ordering that the mortgage loan be reinstated without penalty awarding Tonagel damages and attomey fees on her s reconventional demand and ordering that the law firm of Dean Morris LLP and attorney Charles H Heck Jr be disqualified fronn representing any party relative to these proceedings For the reasons that follow we vacate the judgment of the trial court FACTS AND PROCEDURAL HISTORY On August 10 2010 Wells Fargo filed a petition to enforce security interest by executory process seeking the issuance of a writ of seizure and sale of mortgaged properiy securing a 2009 loan made to Ms Tonagel An order commanding the St Tammay Parish Sheriff Sheriffl to seize and sell the property affected by the mortgage was issued on August 12 2010 A writ of seizure was issued on the same date Unable to effectuate service upon Ms Tonagel Wells Fargo moved to have a cwator ad hoc appointed by the trial court The trial court subsequently appointed attorney James Casey Fos to receive service Thereafter on January 21 2011 Mr Fos on behalf of Ms Tonagel filed a Petition for Injunction of Judicial Sale Motion to Disqualify Counsel and Reconventional Demand for Damages Payment of Costs and Attorney sFees In this pleading Ms Tonagel sought to have the August 12 2010 order of seizure and sale set aside and the writ of seizure recalled to enjoin the Sheriff from proceeding with the sale of the property reinstatement of the mortgage without penalties to enjoin the law firm of Dean Morris and attorney Charles H Heck Jr from acting as counsel for Wells Fargo damages for Wells Fargo unauthorized s 2 use of executory process damages for Wells Fa bad faith and unfair trade s go practices in violation of the Louisiana Unfair Trade Practices Act UTPA and s attorney fees An order was subsequ sign by the trial court on January 24 2011 ntly d granting a hearing for preliminary Ynj ef j sa1e with the date to be tioza ar dicial determined It further ordered that Wells Fargo appear for a hearing on January 31 2011 and show cause why the court should not enter an order in favor of Ms Tonagel granting her request to vacate the order of seizure entered on August 12 2010 for disqualification of counsel for Wells Fargo and for an award of damages costs and attorney fees reinstatement of the mortgage loan without s penalty and all other relief as is reasonable However the parties subsequently or agreed to re the judicial sale for a later date and continue the hearing schedule Nevertheless on May 6 2011 Mr Fos sent a request to the trial court asking that it enter a preliminary default against Wells Fargo on the reconventional demand stating that Wells Fargo was served with the reconventional demand on 7anuary 24 2011 but as of the date of the request iY had not filed an answer to the demand Thereafter on May 10 2011 the trial court ordered entry of a preliminary default against Wells F by way of a minute entry argo On May 17 2011 the trial court held a hearing to confirm t preliminary ie default judgment entered against Wells Fargo at the conclusion of which the trial court rendered judgment in favor of plaintiff in reconvention Ms Tonagel and against Wells Fargo as prayed The trial court signed a judgment on May 24 2011 finding the allegations of fact and law as pled in the petition for injunetion motion to disqualify and reconventional demand for damages were well founded and that Ms Tonagel had made a prima facie case warranting juas prayed gment far in the pleadings The judgment ordered the seizure entered August 12 2012 be vacated and ordered the Sheriff to return the property to Ms Tonagel ordered 3 the mortgage loan be reinstated without penalty and that all penalties fees and charges by Wells Fargo be removed disqualified Dean Morris LLP and Charles H Heck Jr from representing any party relative to these proceedings awarded Ms Tonagel damages totaling 75 and attorney fees in the amount of 00 000 s 00 000 5 and awarded treble damages for Wells Fargds fraud and unfair trade or practices in violation of the Louisiana UTPA La R 51 S 1401 Wells Fargo subsequently filed a motion for new trial asserting lack of notice as required by La C art 1702 the absence of evidentiary support P A for the relief sought by Ms Tonagel and the relief granted contravened applicable substantive law Following a hearing on Wells Fargo motion the trial court s signed a judgment on November 23 2011 granting a new trial in part as to the award pursuant to the UTPA and denied the motion for new trial as to all other issues Thereafter on December 21 20ll the trial court signed an order consented to by the parties vacating the portion of the May 24 2011 judgment awarding Ms Tonagel treble damages and attorney fees for violation of the s TPA iJ and ordering that the remainder of the court May 24 2011 judgment shall s remain in full force and effect and is designated as a partial final judgment finding no just reason far delay Wells Fargo now appeals from the trial court judgment s After reviewing the txial court May 24 2011 judgment and the November 23 2011 s order certifying the judgment as final and considering the overriding inquiry of whether there is no just reason for delay as well as the other non criteria trial court should use in exclusive s making the determination of whether certification is appropriate we find that the trial court properly certified the May 24 20ll judgment as a final appealable judgment See R J er Messin Inc v Rosenblum 04 pp 13 La 3 894 So 2d 1113 ll22 1664 14 OS 2 Motorola Inc v Associated Indemnity Corp 02 p 16 La App lst Cir 10 867 1351 03 22 So 2d 723 732 In addition to filing the instant appeal Wells Fargo also filed a supervisory writ with this court on December 27 2011 seeking review of the trial court partial denial of its motion for s new trial In an interim order dated March 28 2012 the previously filed writ application was referred to the panel to which the appeal is assigned See Wells FarQO N v Tonagel 2011 A 2400 La App lst Cir 3 unpublished writ action However because the May 24 2011 12 28 judgment is a final appealable judgment and the writ application raises the same issues raised in the appeal currently before us we hereby dismiss the writ application as moot See Code v Denartment of Public Safetv and Corrections 11 p 5 App lst Cir 10 103 So 1282 La 12 24 3d 1118 1123 n writ denied 12 La 1 105 So 3d 59 6 2516 13 23 4 DISCUSSION Executory proceedings are those which are used to effect the seizure and sale of property without previous citation and judgment to enforce a mortgage or privilege thereon evidenced by an authentic act importing a confession of judgment and in all other cases allowed by law La GC art 2631 Defenses P and procedural objections to an eXecutory proceeding may be asserted either through an injunction proceeding to arrest the seizure and sale as provided in Articles 2751 through 2754 or a suspensive appeal from the order directing the issuance of the writ of seizure and sale or both La C art 2642 When P utilizing the injunction procedure the petition for injunction sha11 be filed in the court where the executory proceeding is pending either in the executory proceeding or in a separate suit and the injunction proceeding shall be govemed by the provisions of Articles 3601 through 3609 and 3612 except as provided in Article 2753 La C art 2752 P In the instant case Ms Tonagel filed a Petition for Injunction of Judicial Sale in the executory proceeding which also included a reconventional demand for damages and attorney fees for the wrongful seizure of the property at issue and s for purported violations of the UTPA A defendant in a principal or incidental action must file an answer within fifteen days after service of citation upon him except as otherwise provided by law La C arts 1001 and 1035 P If a defendant in a principal or incidental demand fails to answer within the time prescribed by law judgment by default may be entered against him La C art P A 1701 This judgment of default is commonly referred to as the preliminary default See Power Marketinp Direct Inc v Foster 05 p 10 La 9 2023 06 6 2 Because we find Ms Tonagel failed to comply with the notice requirements for confirming the default judgment against Wells Fargo we specifically do not address whether her reconventional demand is properly asserted in this executory proceeding See La C art P 462 see also La C art 2644 noting that a plaintiffin an executory proceeding may conver P it into an ordinary proceeding 5 938 So 2d 662 669 The judgment may be obtained by oral motion in open court or by written motion mailed to the court either of which shall be entered in the minutes of the court but the judgment shall consist merely of an entry in the minutes La C art 1701 P A Louisiana Code of Civil Procedure article 17G2 sets forth two procedures A for confirmation of a default judgment witkz the defendant actions in the case s determining the procedure to be utilized by the plaintif Power Marketin Direct 2023 OS at p 10 938 So 2d at 669 If no answer is filed timely the plaintiffmay confirm the judgment of default after two days exclusive of holidays from the entry of the judgment of default La GC art 1702 However when a P A judgment of default has been entered against a party that is in default after having made an appearance of record in the case notice of the date of the entry of the judgment of default must be sent by certified mail by the party obtaining the judgment of default to counsel of recard for the pariy in default or if there is no counsel ofrecard to the party in default at least seven days exclusive of holidays before confirmation ofthe judgment of default La GC art 1702 P A Courts have held that in order to obtain a valid confirmation of a default judgment strict compliance with the procedural requirements of La C art P A 1702 is required See Nickens v Patriot Home Sst 97 p 5 s em 0291 La App lst Cir 6 713 So 2d 1179 1182 Jules v Lege 618 So 2d 1121 98 29 1122 La App Sth Cir writ denied 629 So 2d 344 La 1993 Further if a judgment of default is confirmed before the expiration of the delay prescribed by statute i two legal days after entry of the preliminary defaalt if no answer is e timely filed or seven days after notice is sent if the defaulting party has made an appearance of record the confirmation of the judgment of default is premature and the judgment is null and invalid Power Marketin OS at p 11 938 Direct 2023 So 2d at 670 A final judgment shall be annulled if it is rendered against a 6 defendant against whom a va ju Y defau has not been taken La di rnent P C art 2002 see also Power Marketin Dizect OS at p ll 938 So 2 A 2023 2d at 670 In the instant case Ms T requested an i 6 2011 that the trial riagel Vlay court enter a preliminary default gainst Nwlls Fargo on her recc tional xiver demand stating that service had be nad o c w F on January a auns lfor i1s argo 24 201 l and that as of the date of its request Well Fargo had not filed an answer s to its reconventional demand On t same date l he s TonageI also notified Wells Fargo by certified mail of her intent to seek a preli default Thereafter on inary r May 10 2011 the trial court entered a judgment of default against Wells Fargo and following a hearing on May 17 2011 confrnied the default judgment Wells Fargo asserts oii a that the trial court erred in confirming a peal default judgment against it because Ms Tonagel failed to comply with the notice requirements ofLa C art 1702 Specifically Wells Fargo asserts that Ms P A Tonagel failed to provide Wells Fargo with notice of the date of entry of the t judgmer of defauit by certified mail at least se days before confirmatiUn of the en default judgment The Legislature added this paYtica ne requir wb it amended r l trce ment en La GC art 1702 through Acts OU1 1 5 The amen specified P A 1n 1 2 nt m that notice of the date of entry ofthe deiault jixdgmen must be given to the party in default who znade an appearance of record Pow 1v1aretine L 5 p z irect 202 3at 15 6 n 938 So 2d at 672 n 6 ice Appeara of record is intended to have the same meaning as in La C art 1671 and includes filing a pleading such as any P one or more of the exceptions appearing at a hearing and formally enrolling as counsel of record Comments b to La C art 1702 The purpose of 2001 P this amendment is to conform default procedure tu the rationale s foz in Russell t th v Illinois Central Gulf Railr 6 I1 686 So 2d 17 tiat it is ad 2649 a 101 7 7 an ill practice to confirm a judgrnent of default ivit nokice against a party oixt that has already filed pleadin consrituting n ppeaxance o record in the s fitigation proceedings Co a to I C art l70 2f141 ents r P We11s Farg izi the ex a seekira the seiziar and sale rtiated rv nK at e of the mortgaged roperty aald oi an rdex f the t court grant the taane oan ial ng requested relief Ms 1 filed a petition for i onagel on ici 2jixnct efju sale motion I to disqualify counsel and reconventional demand for damages in the executory proceeding in defense of and in response to Wells Fargo action Both actions s arise out of the same seizure and sale of the property and concern an identical issue i the validity of the executory proceeding Therefore from our review of e the record and considering the piain language as well as the intent of the legislature in amending La C art 1702 we find that the record P A demonstrates that Wells Fargo made an appearance of record i the litigation proceedings and Ms Tonagel was required to provide it with notice of the date of enYry of the judgment of default by certified mail at least seven days exclusive of holidays before confirmation of the default jazdgment See Russell 96 at pp 2649 3 2 686 So 2d at 819 finding it was an iil practice for a plaintiff attornzy to s obtain a default judgment without attempting to notify the opposing attorney when the opposing attorney in an on petitory action had participated in the going litigation proceedings Power Marketinllirect 05 at pp 18 938 So 2d 2023 19 at 674 finding it was an ill practice for plaintiff to fail to notify defendant of his intent to seek a default judgment given plaintiff knowledge that deferidant lacked s notification and considering that defendant was actively prosecuting and defend ng its rights in Ohio litigation involving idenv issues arising out of the sattxe cal contractual dispute between the same parties Duckworth Properties L v C Williams 10 pp 5 La App 4th Cir 11 52 So 3d 7 291 0244 6 10 2 finding it was an ill practice for plaintiff to take a default judgment against the 8 defendant in one jurisdiction while a suit arising out of the same contractual dispute was pending in another jurisdiction As evidenced by the record Ms Tonagel failed to provide Wells Fargo with notice of the date of the entry of the judgment of default certified mail at least by seven days exclusive of holidays before confirmation of the judgment of default While Ms Tonagel sent a letter by certified mail to Wells Fargo on May 6 2011 enclosing its request to the clerk of court to enter a preliminary default which was received by Wells Fargo on May 9 2011 it does not notify Wells Fargo of the date of the entry of the judgment of default which judgment was not entered until May 10 2011 As previously noted strict compliance with the procedural requirements of La C art 1702 is required in order to obtain a valid confirmation of a P A default judgment Therefare because Ms Tonagel failed to send the required notice to Wells Fargo the judgment confirming the default is null See Jackson v Culotta 10 p 4 App Sth Cir 3 62 So 3d 803 804 879 La I1 29 CONCLUSION For the foregoing reasons we vacate the May 24 2011 judgment confirming Ms Tonagel default judgment and remand this matter to the trial court far further s proceedings All costs of this appeal are assessed to Diana Tonagel JUDGMENT VACATED AND REMANDED WRTT DISMISSED MOTION TO STRIKE DISMISSED Wells Fargo filed a motion to strike supplemental trial exhibits with this court on June 29 2012 requesting that this court issue an order striking documents added to the trial court record which it asserts were not previously filed with the trial court and were not properly authenticated or admitted Because these documents allegedly relate to the confirmation of the default judgment which judgment we have determined to be null we dismiss the motion to strike as moot 9

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