Ali v. DSA Partners I, Ltd.
| Decision Date | 24 March 2020 |
| Docket Number | No. 05-18-01240-CV,05-18-01240-CV |
| Parties | ASIF ALI, Appellant v. DSA PARTNERS I, LTD., Appellee |
| Court | Texas Court of Appeals |
On Appeal from the County Court at Law No. 2 Dallas County, Texas
Before Justices Partida-Kipness, Nowell, and Evans
Opinion by Justice Nowell
Asif Ali appeals an adverse summary judgment in favor of DSA Partners I, Ltd. and the trial court's order granting DSA Partners' motion to sever. In three issues, Ali argues the trial court's consideration of DSA Partners' motion for summary judgment was premature, the relief sought in the motion was inconsistent with the pleadings, and the trial court erred by granting DSA Partners' motion to sever. We affirm the trial court's order granting the severance and its judgment.
Weekley Homes, LLC conveyed real property located in Irving, Texas (the Property) to Ali by warranty deed with vendor's lien. To finance the purchase, Ali obtained a loan from DSA Partners and executed a real estate lien note; Ali executed and delivered a deed of trust to DSA Partners to secure the loan. The first and superior vendor's lien was transferred to and retained by DSA Partners. After a couple of years, Ali failed to make the required monthly payments and DSA Partners gave Ali notice of his default and an opportunity to cure. When Ali did not tender the delinquent funds to DSA Partners, DSA Partners accelerated the maturity of the note. Ali filed bankruptcy, but the automatic stay was lifted as to DSA Partners' right to foreclose on the Property.
Ali filed his original petition alleging the deed of trust was not valid because his wife, Anju Thapa, did not sign the document. Additionally, he asserted DSA Partners was unlicensed to make the loan and DSA Partners' actions in threatening or effecting a substitute trustee's sale of the Property were violations of the Texas Debt Collection Act. Ali sought monetary damages for alleged violations of the Texas Finance Code and injunctive relief.
DSA Partners filed a counterclaim against Ali and a third-party petition against Thapa and the United States of America, Department of Treasury, Internal Revenue Service (IRS) to foreclose its vendor's lien. DSA Partners asserted it believed Ali was married to Thapa at the time he acquired title to the Property and executed the note even though Ali represented to DSA Partners that he wasunmarried in his sworn loan application. DSA Partners' pleading states: "DSA is entitled to judicial foreclosure of the Vendor's Lien securing the Ali Note against Ali and Thapa in rem only to the extent of their interests in the Property and an order of sale providing for the sale of the Property to satisfy the in rem judgment rendered against Ali herein, plus costs of such sale." DSA Partners' pleading states its belief that the IRS could claim an interest in the Property by virtue of a federal tax lien filed in the property records; DSA Partners pleaded its entitlement to a declaratory judgment that the IRS's claims were subordinate and inferior to its vendor's lien and foreclosure of the vendor's lien would extinguish the IRS's claims upon the Property.
On March 8, 2018, DSA Partners filed a motion for partial summary judgment in rem only to foreclose its vendor's lien. The motion states it "only addresses DSA Partners' in rem only claim under the note against Ali, claim for judicial foreclosure against Ali and Thapa, Ali's claim that DSA Partners has no valid lien interest, and Ali's request to enjoin DSA Partners from ever attempting to foreclose." DSA Partners asserted three bases for its summary judgment: (1) it was entitled to partial summary judgment against Ali and Thapa in rem to judicially foreclose its vendor's lien because Ali defaulted on the purchase-money loan that the vendor's lien secures; (2) Thapa's non-joinder in the deed of trust had no impact on enforcement of the vendor's lien because Thapa's interest in the Property arose from the instrument thatcreated the vendor's lien; and (3) Ali's request to enjoin any attempts by DSA Partners to foreclose was improper. Eight days later, on March 16, 2018, the IRS filed its response stating it did not oppose DSA Partners' motion because the United States Supreme Court decreed a federal tax lien is subordinate to a purchase-money interest, and the IRS issued a revenue ruling formally pronouncing federal tax liens are inferior to valid purchase money mortgages. The IRS requested the trial court recognize its right of redemption of the Property and requested the trial court order proceeds of the foreclosure sale be applied as payment to the amount due to the IRS as holder of the federal tax lien after the amount due to DSA Partners was paid in full. On March 23, 2018, DSA Partners and the IRS filed a motion for entry of agreed interlocutory judgment.
Ali responded to DSA Partners' motion for partial summary judgment and raised the two arguments he asserts on appeal: (1) DSA Partners and the IRS's request for entry of agreed interlocutory judgment amended the motion and, therefore, Ali was entitled to twenty-one days from March 23, 2018, the date of the filing, and (2) the prayer for relief in the motion was not supported by the pleadings. Following a hearing on March 30, 2018, the trial court granted the motion.
In his first issue on appeal, Ali asserts the trial court erred by granting DSA Partners' motion because it was premature; the joint motion for entry of agreed interlocutory judgment between DSA Partners and the IRS amended DSA Partners' motion for partial summary judgment, thus entitling him to twenty-one days fromthe date of the filing to the hearing. A defending party such as DSA Partners may move at any time for summary judgment in its favor. TEX. R. CIV. P. 166a(b). The motion and any supporting affidavits shall be filed and served at least twenty-one days before the hearing. TEX. R. CIV. P. 166a(c). Ali does not argue the motion and supporting affidavits were not served at least twenty-one days before the hearing; he only argues the joint motion for entry of agreed interlocutory judgment should have been considered an amendment entitling him to additional time.
If the purchase money is not paid, a seller holding a vendor's lien may elect to judicially foreclose that lien. See XTO Energy, Inc. v. EOG Res., Inc., 554 S.W.3d 127, 139 (Tex. App.—San Antonio 2018, pet. abated); see also Goidl v. N. Am. Mortg. Inv'rs, 564 S.W.2d 493, 495 (Tex. App.—Dallas 1978, no writ). In this case, DSA Partners could have chosen not to file a third-party petition against the IRS and proceeded to foreclose against Ali's interest in the property. See Miller v. Royal ISD, No. 14-14-00753-CV, 2015 WL 9311429, at *2 (Tex. App.—Houston [14th Dist.] Dec. 22, 2015, pet. denied). Instead, DSA Partners filed a third-party petition against the IRS. The IRS conceded its tax lien was subordinate to DSA Partners' vendor's lien. The IRS's tax lien, the subject of the joint motion for agreed interlocutory judgment, was not relevant to DSA Partners' right to foreclose against Ali's interest in the Property, the subject of its motion for partial summary judgment. Because...
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