NAY v. FIRST FINANCIAL BANK

NAY v. FIRST FINANCIAL BANK, FSB
2003 OK CIV APP 91
79 P.3d 1124
Case Number: 98400
Decided: 05/16/2003
Mandate Issued: 10/24/2003
DIVISION I
THE COURT OF CIVIL APPEALS OF THE STATE OF OKLAHOMA, DIVISION I

WILLIAM D. NAY and SYLVIA J. NAY, Plaintiffs/Appellants,
v.
FIRST FINANCIAL BANK, FSB, EL DORADO, ARKANSAS, Defendant/Appellee.

APPEAL FROM THE DISTRICT COURT OF TULSA COUNTY, OKLAHOMA

HONORABLE RONALD L. SHAFFER, JUDGE

REVERSED AND REMANDED WITH INSTRUCTIONS

Frederick K. Slicker, Tulsa, Oklahoma, for Plaintiffs/Appellants,
Melvin R. McVay, Jr., Thomas P. Manning, Oklahoma City, Oklahoma, for Defendant/Appellee.

OPINION

Carl B. Jones, Judge:

¶1 This case involves Plaintiffs' action to recover statutory damages under

¶2 Plaintiffs filed the instant action on June 12, 2000, asserting Bank's failure to file the lien release in accordance with §15 warranted statutory penalties. Bank filed a lien release with the Tulsa County Clerk, along with the required filing fee of $8.00, four days later. Each side moved for summary judgment and both were denied by the trial court. Following pretrial conference, both parties renewed their summary judgment motions and agreed that all issues in the case presented questions of law. Bank maintained that Plaintiffs' demand letter of November 29, 1999, did not meet the requirements of §15 and, even if it did, Bank satisfied the statute by mailing a release to Plaintiffs seven days later. Plaintiffs claimed their demand letter was proper and that §15 required Bank, not Plaintiffs, to file the lien release. Plaintiffs also claimed the release filed by Bank was invalid.

¶3 The trial court granted Bank's motion for summary judgment and denied Plaintiffs' motion for summary judgment. Plaintiffs' motion to reconsider was overruled. From these rulings, Plaintiffs appeal. The matter stands submitted without appellate briefs on the trial court record. See Rule 13(h), Rules for District Courts, 12 O.S. 2001, Ch. 2, App. 1, and Rule 1.36, Oklahoma Supreme Court Rules, 12 O.S. 2001, Ch. 15, App.

¶4 Title

Any mortgage on real estate shall be released by the holder of such mortgage within fifty (50) days of the payment of the debt secured by the mortgage and the holder of the mortgage shall file the release of the mortgage with the county clerk where the mortgage is recorded. If, at the end of the fifty-day period, the holder has failed to release the mortgage, the mortgagor may at any time request in writing the holder of the mortgage to release the mortgage and the holder of the mortgage shall have ten (10) days from the date of the request to release such mortgage. If the holder of the mortgage fails to release the mortgage by the end of such ten-day period, he shall then forfeit and pay to the mortgagor a penalty of one percent (1%) of the principal debt not to exceed One Hundred Dollars ($100.00) per day each day the release is not recorded after the ten-day period has expired and the penalty shall be recovered in a civil action in any court having jurisdiction thereof, but the request for the release shall be in writing and describe the mortgage and premises with reasonable certainty. Provided that, the total penalty shall not exceed one hundred percent (100%) of the total principal debt.

The primary issues in this appeal are whether Plaintiffs' demand letter satisfied the requirement of §15 that such demand "describe the mortgage and premises with reasonable certainty" and, if the demand satisfied that requirement, whether §15 mandated that Bank, rather than Plaintiffs, file the lien release with the county clerk.

¶5 In relevant part, Plaintiffs' demand letter stated, "This letter is my written demand for release of the mortgage recorded in reference to the above identified loan which has been paid in full." The letter specifically referenced the loan number assigned by Bank to Plaintiffs' loan. Bank does not allege it was unable to identify the mortgage or premises referred to in Plaintiffs' letter. Indeed, Bank executed a release and sent it to Plaintiffs within a week of the demand, and admitted during discovery that the loan number identified Plaintiffs' mortgage. Rather, asserting that §15 must be strictly construed because it is penal in nature, Bank simply urges Plaintiffs' demand letter did not comply with the statute's requirement of a "description" of the mortgage and premises.

¶6 While we agree §15 must be strictly construed, Walker v. Dugger,

¶7 Contrary to Bank's suggestion, §15 does not mandate demand letters contain a literal "description" of the mortgage and premises. The phrase "with reasonable certainty" operates to modify the word "describe." We initially note "reasonable certainty" does not mean "absolute certainty." Florafax Int'l, Inc. v. GTE Mkt. Resources, Inc.,

¶8 Other Oklahoma decisions have expressed similar sentiments regarding the term "reasonable certainty." In City of Cherokee v. Tatro,

¶9 Strict construction of a statute "is that which refuses to extend the law by implications or equitable considerations and confines its operations to cases . . . clearly within the letter of the statute, as well as within its spirit or reason." Walker,

¶10 With respect to its second argument, Bank contends it was required to file a release with the county clerk only within the first fifty days after the loan was paid. After that period, Bank urges it was merely required "to provide a release" to Plaintiffs. This argument is patently meritless. The first sentence of §15 states that the mortgage holder "shall file" the mortgage release with the county clerk. The second sentence describes when a mortgagor may request a release and provides that a mortgage holder has ten days to respond thereto. The third sentence then sets forth the penalty for the mortgage holder's failure to "release the mortgage" after the ten-day period and specifies the penalty per day "each day the release is not recorded." The penalty provisions are triggered only after the ten-day period expires.

¶11 Under Bank's theory - a mortgage holder is not required to file a release after the initial fifty-day period - the penalty provisions of §15 would never be invoked. Not only is this argument illogical, but it is also contrary to rules of statutory construction. See Purcell v. Santa Fe Minerals, Inc.,

¶12 To the extent Bank relies upon Pfalzgraf v. Ward,

¶13 Lastly, we address Plaintiffs' contention that the release ultimately filed by Bank was invalid. On its face, the instrument appears to be a valid release in all respects. However, Plaintiffs allege the individual who notarized the release was not a notary on the date of acknowledgment. Bank counters that a scrivener's error resulted in an incorrect acknowledgment date, but that the notary was duly certified as such on the actual date of acknowledgment. Being otherwise properly executed, Bank urges the June 16, 2000, release is valid. We agree with Bank. The release was signed and sealed by an authorized corporate officer and acknowledged by a licensed notary public who attested she personally knew the officer and witnessed his signature. As set forth in Standard 6.2, Title Examination Standards, 16 O.S. 2001, Ch. 1, App., an incorrect acknowledgment date does not impair marketability. Notwithstanding the erroneous acknowledgment date, Bank's release contained "enough correct data to identify the grant[] being released with reasonable certainty." Title Examination Standard 24.4. The release is therefore valid under Oklahoma law.

¶14 Upon de novo review of the instant record, Hoyt v. Paul R. Miller, M.D., Inc.,

¶15 REVERSED AND REMANDED WITH INSTRUCTIONS.

HANSEN, J., and MITCHELL, P.J., concur.

FOOTNOTES

1 Plaintiffs' summary judgment materials included evidence that Bank consistently and repeatedly used the loan number as a unique identifier for Plaintiffs' mortgage and premises: All communications from Bank used the loan number; Bank asked that the loan number be referenced in all communications to it, including telephonic communications; payment coupons used the loan number; the loan number is included on the promissory note; Bank's acknowledgment of payment referenced the loan number; and the mortgage release filed by Bank prominently displayed the loan number.