Bank v. Reeves
| Decision Date | 02 March 2007 |
| Docket Number | No. 0268 September Term, 2005.,0268 September Term, 2005. |
| Citation | 173 Md. App. 392,919 A.2d 738 |
| Parties | LaSALLE BANK, N.A. v. Elizabeth A. REEVES, et al. |
| Court | Court of Special Appeals of Maryland |
James J. Gorney, LaPlata, MD, for Appellant.
Elizabeth A. Reeves, Lexington Park, MD and Monica Haley-Pierson, Upper Marlboro, MD, for Appellee.
Panel: DEBORAH S. EYLER, SHARER and MEREDITH, JJ.
In the Circuit Court for St. Mary's County, appellant, LaSalle Bank, NA, filed an amended complaint for declaratory relief seeking reformation of a deed of trust which, appellant asserted, inaccurately described the property that secured the deed of trust. Named as defendants below were appellees, Elizabeth A. Reeves and the Delaware Tribe of Western Oklahoma.1
On grounds that the statute of limitations barred appellant's claim, the circuit court granted appellees' motion to dismiss.2 In this timely appeal, appellant raises two issues which, as rephrased, are:3
1. Whether the circuit court erred in ruling that appellant's claim was barred by the three-year statute of limitations set forth in Md.Code Ann., Cts. and Jud. Proc. § 5-101.
2. Whether the circuit court erred in applying the statute of limitations for civil actions rather than applying the equitable doctrine of laches.
Appellees have raised an issue of jurisdiction and immunity:
The tribal owner is entitled to its defense of immunity and the case must be dismissed.
For the reasons that follow, we shall reverse the judgment of the circuit court as it relates to the limitations/laches issue. Finding the want of a necessary party, we shall remand to the circuit court for further proceedings.
In our recital of the facts, we shall eliminate the somewhat serpentine series of transactions that ultimately gave rise to this litigation, and focus on the present parties.
Reeves owned an improved lot, consisting of three acres more or less, in Chaptico, St. Mary's County ("the Property"). In 1998, Reeves negotiated a loan, secured by a deed of trust on the Property. In 2000, Reeves applied to refinance the loan, to be secured by another deed of trust on the Property in the same amount. On February 24, 2000, a deed of trust was executed for the benefit of LaSalle's predecessor in interest, Residential Lending Corporation. The legal description set out in the deed of trust, however, was incorrect. In fact, the description defined a parcel consisting not of 3 acres, but of only 1.411 acres. The smaller parcel described, however, was within the larger parcel. On March 6, 2000, the refinanced loan, and all relevant documents, including the deed of trust, were assigned to LaSalle.
On April 23, 2002, for reasons not entirely clear from the record, Reeves executed a quitclaim deed, recorded among the land records of St. Mary's County, conveying any interest she held in the Property to the Delaware Tribe. Reeves defaulted in June 2002, and LaSalle instituted foreclosure proceedings. LaSalle "bought in" the Property at the foreclosure sale. In preparation for resale of the foreclosed Property, LaSalle discovered the mistake in the description in the deed of trust. In its amended complaint, filed on December 7, 2004, appellant asked the circuit court to reform the deed of trust by substituting a correct description of the Property secured, encompassing the entire three acres as intended by the parties, and to impute the corrected description to the Property actually sold at the foreclosure sale. Appellees responded with a motion to dismiss.
The circuit court held hearings on February 16, 2005, and March 2, 2005. On March 2, the court granted Reeves's motion to dismiss, ruling that the claim was barred by the three-year statute of limitations.
The circuit court set forth its analysis in an oral opinion as follows:
Here, as I understand it, are the facts that are relevant to my ruling. I have been asked to reform a deed of trust signed on February 24, 2000, ... [The] Deed of trust was signed by Ms. Reeves, deeding to Schedule A Trustee, ... for [the] benefit of Superior Bank to collateralize a loan of some $300,000. The deed of trust before the Court, and filed in the land records of Saint Mary's County, deeded 1.41 acres as the security for the loan. On July 21, 200[0] ... Ms. Reeves filed a voluntary petition ... in bankruptcy. Superior Bank, the predecessor to [appellant], moved ... for relief from ... the bankruptcy stay, the property known as lot five and seven as shown on a plat entitled White Plains Farm, which we all agree is the property in issue here, [and] also property shown as lots one, two and eight, White Plains Farm. In any event, no matter how described by the bankruptcy court, we all agree it is the property in issue here.
[] On February 5, 2001, a consent order granting relief from the stay as to 24889 Lucie Beall Lane ... was ... granted, [to] the plaintiff, Superior Bank, ... lifting the stay on that property, and they proceeded to foreclosure. ... [O]n November 10th, the year 2003, the [appellant] being the successor in interest to Superior Bank, to this deed of trust, and to the loan, filed in this Court a motion for declaratory relief, a complaint for declaratory relief, asking that this Court declare that the deed of trust, ... be reformed because of a mutual mistake. And the summary judgment asked that the Court-suggests to the Court that there is no disagreement as to the facts in this case[.] [Reeves] filed a motion, . . . to dismiss as being beyond the time period provided in the statute of limitations[.] The problem is, the statute she cited was for the civil actions, absent specialities, and that is the three year statute that controls civil actions. If this case is such a civil action as the statute of limitations refers to, then the timing herein makes her correct and this matter must stand dismissed. And I thought that was going to be rather easy until I did some research, realizing that this is an equitable action. Then the question is, does the doctrine of laches control?
Laches is a—doctrine that denies to parties the use of the Court if they sleep on their rights. And by doing so, there would be some injury to the other party. So issues I have to decide are essentially, one is the civil, the statute of limitations for civil filing controlling. If that is not controlling, what is the term of laches that would be reasonable in this case, or does laches even apply to this case, and then is reformation in order?
* * *
If when the courts, when equitable actions were abolished in [19]84 by being merged into law actions, bring us pretty much in line with then the federal system, procedure. They did not abolish the equitable principles and doctrines. However, the statute of limitations, there was no curing statute for the doctrine of laches, and though I think [counsel for appellant] is correct, that if latches [sic] were [sic] the controlling doctrine, I don't think laches would apply in this case, I don't think [the time] would have run because I do not find there to be any injury whatsoever to the [appellees] in this case. The [appellees] would really be put in the position they intended to be in the first place.
* * *
So I find that the doctrine of laches, if it were applicable to this case, laches would not have yet run because there is no harm done to the defendant. However, I find the doctrine of latches [sic] does not control. I find that the civil— the statute of limitations as to the civil actions . . . does control[.] And, therefore, this case was filed beyond that statute, and for that reason, will have to be dismissed. However, I make a further finding to make it a little bit simpler on whoever may be reviewing this, in that statute, as I have ruled it does, does not apply to this case. And if I, as I have ruled that laches would not have run, reasonably run at this point because there is no harm to the [appellee] then I would have been compelled by the facts before me to grant [appellant's motion for] summary judgment because it is clearly set out in sworn testimony of the [appellee] that she intended the very relief, she intended the very facts to exist that the relief seeks to accomplish. In plain English, she says in her deposition she meant to deed the 3 acres that she put the yellow line around. She says that under oath. Actually, I shouldn't be taking testimony today but I allowed her to get on the-I ordered her to get on the witness stand to testify, but the bottom line is I think that has to be dismissed because I believe the statute of limitations controls.
We shall refrain from confusing the reader with a detailed recital of the myriad motions, responses, and other pleadings filed in the circuit court, many of which, facially, appear to approach being frivolous. It is sufficient for the purpose of this opinion to note that appellant filed a complaint, and later an amended complaint, for declaratory relief, seeking, in essence, reformation of the erroneously drawn deed of trust. After a good deal of paper skirmishing, the matter came on for hearing in the circuit court on appellant's amended complaint for declaratory judgment and Reeves's motion to dismiss.
The hearing below proceeded with the argument of counsel, at least to the point at which the court invited Reeves to become a witness. That, in our view, amounted to consideration by the court of matters outside the pleadings and served to convert the motion to dismiss to a motion for summary judgment. See Md. Rule 2-322(c); Vogel v. Touhey, 151 Md. App. 682, 703-04, 828 A.2d 268 (2003). Hence, we shall review the circuit court's findings and judgment under the standard prescribed for summary judgment proceedings.4
In reviewing a grant of summary judgment, we are concerned with whether a dispute of material fact exists. Hartford...
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