Frank S. Smith, Jr. v. Secretary of Veterans Affairs, an officer of the United States of America

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REL: 3/30/12 Notice: T h i s o p i n i o n i s s u b j e c t t o formal 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 R e p o r t e r o f D e c i s i o n s , 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 be 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 2100194 Frank S. Smith, J r . v. S e c r e t a r y o f Veterans A f f a i r s , an o f f i c e r o f the U n i t e d S t a t e s o f America Appeal from J e f f e r s o n C i r c u i t Bessemer D i v i s i o n (CV-09-504) Court, A f t e r Remand f r o m t h e A l a b a m a Supreme Court PER CURIAM. The judgment Alabama of this Supreme court, Court Smith ( 1 ) has reversed v. Secretary of the p r i o r Veterans 2100194 Affairs, Civ. [Ms. 2100194, June 24, 2011] So. 3d (Ala. App. 2 0 1 1 ) , w h i c h r e v e r s e d t h e j u d g m e n t o f t h e J e f f e r s o n Circuit Court, Bessemer D i v i s i o n , cause f o r f u r t h e r p r o c e e d i n g s and c o n s i s t e n t w i t h i t s o p i n i o n . See Ex p a r t e S e c r e t a r y o f V e t e r a n s A f f a i r s , 2012] ___ So. 3d ___ o f F r a n k S. S m i t h , prior decision. Frank summary Affairs, [Ms. 1101171, Feb. 10, ( A l a . 2 0 1 2 ) . We now a d d r e s s an argument J r . ("Frank"), t h a t we d i d n o t r e a c h i n o u r 1 argues judgment that the t r i a l i n favor an o f f i c e r of court the of the United Secretary"), because, trial established a court ( 2 ) h a s remanded t h e Frank says, erred i n entering a Secretary States issue Veterans of America the evidence genuine of ("the before of material the fact r e g a r d i n g t h e i d e n t i t y o f t h e p a r t y who s o l d h i s p r o p e r t y a t the foreclosure sale. The Secretary supported h i s summary- j u d g m e n t m o t i o n w i t h , among o t h e r t h i n g s , an a f f i d a v i t by S c o t t H i a t t , a c o p y o f t h e p r o m i s s o r y a copy o f t h e mortgage subsequent assignments signed by signed note s i g n e d by Frank, Frank, o f t h e mortgagee's copies of interest three i n the The f a c t u a l b a c k g r o u n d o f t h i s c a s e a n d i t s p r o c e d u r a l h i s t o r y i n the t r i a l court are r e c i t e d i n our o r i g i n a l d e c i s i o n . See S m i t h v. S e c r e t a r y o f V e t e r a n A f f a i r s , s u p r a . 1 2 2100194 mortgage, the a copy o f an a f f i d a v i t Alabama Messenger, Hiatt's affidavit and a copy o f t h e states that A m e r i c a , N.A.," s o l d F r a n k ' s p r o p e r t y On t h e o t h e r hand, sale t h a t was included "Plaintiff, signed Bank by which the p u b l i s h e r s t a t e s t h a t t h e S e c r e t a r y w o u l d be Frank's at foreclosure auctioneer property The three deed who the foreclosure states that Dana mortgage consist Mortgage Company of an the ("Franklin the selling the Wright McGowin, the sale, from American") s o l d Frank's of the mortgagee's assignment of Likewise, a t t h e f o r e c l o s u r e s a l e on b e h a l f of was sale. conducted the f o r e c l o s u r e assignments of foreclosure Alabama Messenger, property of the at the f o r e c l o s u r e s a l e . i n the Alabama Messenger, the a f f i d a v i t of foreclosure the copy of the n o t i c e of the published with by t h e p u b l i s h e r the newspaper i n w h i c h n o t i c e f o r e c l o s u r e s a l e was p u b l i s h e d , deed. signed Secretary. interest Franklin to North in the American American M o r t g a g e Company ("North A m e r i c a n " ) ; an a s s i g n m e n t f r o m N o r t h American ("MERS"), t o Mortgage as nominee Electronic Registration for PNC Mortgage Systems, Corp. of Inc. America ("PNC"); and an a s s i g n m e n t f r o m MERS, as nominee f o r PNC, the Secretary. The p r o m i s s o r y n o t e s i g n e d 3 to by F r a n k i n d i c a t e s 2100194 that Franklin American signed an indorsement making t h e promissory note payable t o the order o f North American; North American note payable s i g n e d an i n d o r s e m e n t making the promissory t o t h e o r d e r o f MERS, as nominee f o r PNC; a n d t h a t MERS, as nominee f o r PNC, s i g n e d an i n d o r s e m e n t the that making p r o m i s s o r y n o t e p a y a b l e t o t h e o r d e r o f t h e S e c r e t a r y . The r e c o r d does n o t c o n t a i n a n y e v i d e n c e i n d i c a t i n g t h a t B a n k o f A m e r i c a , N.A., was e v e r t h e owner o f t h e m o r t g a g e e ' s in t h e mortgage o r t h e owner o f t h e debt m o r t g a g e . See Coleman v. BAC S e r v i c i n g , 2012] the secured interest by t h e [Ms. 2100453, F e b . 3, ___ So. 3d ___ , ___ ( A l a . C i v . App. 2 0 1 2 ) ( h o l d i n g that power o f s a l e i n a m o r t g a g e may be e x e c u t e d b y a n y p e r s o n who owns t h e d e b t even i f he o r s h e h a s n o t b e e n a s s i g n e d t h e mortgagee's Moreover, interest i n t h e mortgage securing t h e r e c o r d does n o t c o n t a i n a n y e v i d e n c e the debt). indicating t h a t Bank o f A m e r i c a , N.A., was a u t h o r i z e d t o a c t as an a g e n t for the Secretary in selling Frank's property at the f o r e c l o s u r e s a l e . T h u s , H i a t t ' s a f f i d a v i t s t a t i n g t h a t Bank o f A m e r i c a , N.A., s o l d F r a n k ' s p r o p e r t y a t t h e f o r e c l o s u r e sale i s i n c o n f l i c t w i t h t h e n o t i c e o f t h e f o r e c l o s u r e s a l e and t h e a u c t i o n e e r ' s deed and c r e a t e s a genuine i s s u e o f m a t e r i a l 4 fact 2100194 regarding whether Secretary who Moreover, i t was because Bank of s o l d Frank's property there America, N.A., at the f o r e c l o s u r e i s s u b s t a n t i a l evidence p r o v e t h a t Bank o f A m e r i c a , N.A., or the sale. tending d i d n o t have t h e to authority to s e l l Frank's property a t t h e f o r e c l o s u r e s a l e e i t h e r on i t s own of the Secretary, that behalf o r on b e h a l f Bank of foreclosure America, sale N.A., creates a sold Frank's genuine Hiatt's property issue of statement at material the fact r e g a r d i n g w h e t h e r F r a n k ' s p r o p e r t y was s o l d a t t h e f o r e c l o s u r e s a l e by a p a r t y who because h a d t h e a u t h o r i t y t o do s o . the evidence creates Furthermore, a genuine i s s u e of m a t e r i a l fact r e g a r d i n g w h e t h e r F r a n k ' s p r o p e r t y was s o l d a t t h e f o r e c l o s u r e s a l e by a p a r t y who also creates a h a d t h e a u t h o r i t y t o do s o , t h a t e v i d e n c e genuine issue of material fact regarding w h e t h e r t h e S e c r e t a r y , who b a s e s h i s c l a i m t o t i t l e t o F r a n k ' s property on t h e f o r e c l o s u r e deed, has e j e c t m e n t a c t i o n . See S t u r d i v a n t v. BAC LP, [Ms. C i v . App. 2100245, Dec. 2011) 16, (holding 2011] that standing to bring this Home L o a n s S e r v i c i n g , So. 3d , an e j e c t m e n t - a c t i o n that based i t s c l a i m to t i t l e to the property (Ala. plaintiff on a f o r e c l o s u r e deed l a c k e d s t a n d i n g t o b r i n g the e j e c t m e n t a c t i o n because 5 the 2100194 evidence indicated that the foreclosure proceedings lacked the party who initiated the a u t h o r i t y t o i n i t i a t e them on date i t d i d s o ) . Although Frank d i d not argue property at the foreclosure sale e s t a b l i s h e d the existence of issue of f o r e c l o s u r e was v a l i d , not be w a i v e d , of material America, fact 2d regarding sold the whether the "[t]he issue of a lack of standing may a n d an a r g u m e n t c o n c e r n i n g a s s e r t e d f o r t h e f i r s t t i m e on a p p e a l . " at N.A., that statement genuine Bank court Hiatt's a that to the t r i a l standing Sturdivant, may be So. 3d ( c i t i n g R L I I n s . Co. v. MLK A v e . Redev. C o r p . , 925 So. 914, 918 ( A l a . 2 0 0 5 ) ) . Accordingly, and this we r e v e r s e t h e judgment o f t h e t r i a l remand t h e c a u s e f o r f u r t h e r p r o c e e d i n g s c o n s i s t e n t court with opinion. REVERSED AND REMANDED. Thompson, Bryan, joins. P . J . , a n d Thomas a n d Moore, J J . , c o n c u r . J., dissents, with 6 writing, which Pittman, J., 2100194 BRYAN, J u d g e , dissenting. Consistent Loans my dissent i n Sturdivant v. BAC S e r v i c i n g , L P , [Ms. 2100245, Dec. 16, 2011] , whether of a genuine issue of m a t e r i a l fact Home So. 3d ( A l a . C i v . App. 2 0 1 1 ) , I am o f t h e o p i n i o n existence that the regarding t h e f o r e c l o s u r e s a l e was c o n d u c t e d b y a p a r t y who h a d authority fact with t o do s o e s t a b l i s h e s regarding a genuine the a f f i r m a t i v e defense Smith, J r . ("Frank"), t h a t the S e c r e t a r y an o f f i c e r o f t h e U n i t e d States issue of material asserted by Frank of Veterans A f f a i r s , of America ("the S e c r e t a r y " ) , i s n o t e n t i t l e d t o p r e v a i l on h i s e j e c t m e n t c l a i m b e c a u s e t h e foreclosure was Secretary's not v a l i d , b u t i t does not i m p l i c a t e the s t a n d i n g t o b r i n g t h i s e j e c t m e n t a c t i o n . See B e r r y v. D e u t s c h e Bank N a t ' l T r u s t Co., 57 So. 3d 142, 149-50 Civ. App. 2010) plaintiff bases foreclosure (holding h i s or deed, that, her evidence when claim tending f o r e c l o s u r e s a l e and r e s u l t i n g an to ejectment-action legal to title prove on that f o r e c l o s u r e d e e d were than plaintiff tending lacked to standing prove that to bring 7 the a the invalid t e n d s t o p r o v e an a f f i r m a t i v e d e f e n s e t o t h e e j e c t m e n t rather (Ala. claim ejectment-action the ejectment action). 2100194 Because, i n my opinion, t h e argument upon o p i n i o n bases i t s r e v e r s a l of the t r i a l not i m p l i c a t e t h e S e c r e t a r y ' s not p r e s e n t which t h e main c o u r t ' s j u d g m e n t does s t a n d i n g , and because Frank d i d t h a t argument t o t h e t r i a l c o u r t , I d i s s e n t from the main o p i n i o n b e c a u s e i t bases i t s r e v e r s a l o f t h e t r i a l c o u r t ' s j u d g m e n t on an argument t h a t F r a n k w a i v e d b y failing to 773 So. present i t to the t r i a l c o u r t . See Ex p a r t e R y a l s , 2d 1011, 1013 ( A l a . 2000) ("[T]he a p p e l l a t e c o u r t c a n c o n s i d e r an argument a g a i n s t t h e v a l i d i t y o f a summary j u d g m e n t o n l y t o the extent the t r i a l t h a t t h e r e c o r d on a p p e a l court record presenting court before contains m a t e r i a l from t h a t argument t o t h e t r i a l or a t the time of submission of the motion f o r summary j u d g m e n t . Andrews v. M e r r i t t O i l Co., 612 So. 2d 409 (Ala. 1992)."). Pittman, J . , concurs. 8

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