Bostic v. American Home Mortg.

• Decision Date: 18 July 2007
• Docket Number: No. 4278.,4278.
• Citation: 650 S.E.2d 479
• Court: South Carolina Court of Appeals
• Parties: James BOSTIC, Respondent, v. AMERICAN HOME MORTGAGE SERVICING, INC., Appellant.

650 S.E.2d 479

James BOSTIC, Respondent, v. AMERICAN HOME MORTGAGE SERVICING, INC., Appellant.

No. 4278.

Court of Appeals of South Carolina.

Heard June 6, 2007.

Decided July 18, 2007.

David M. Souders and Nancy W. Hunt, both of Washington, D.C. and Jeffrey L. Silver and Donald W. Tyler, Jr., both of Columbia, for Appellant.

Patrick J. McLaughlin, of Florence, for Respondent.

BEATTY, J.

American Home Mortgage Servicing, Inc. (American Home) appeals the circuit court's order granting summary judgment in favor of James Bostic. American Home argues the circuit court erred in finding that Bostic satisfied the "request" requirement of the Recording Statutes, specifically sections 29-3-310 and 29-3-320 of the South Carolina Code, by sending via certified mail a check for the payoff amount of his mortgage. We reverse and remand.

FACTS

On June 3, 1977, Bostic entered into a mortgage agreement with Security Savings and Loan Association of Florence to secure a loan in the amount of $22,475.00, on a parcel of land in Florence. At some point during the course of the mortgage, American Home acquired the note and became the successor mortgagee.

On January 26, 2005, Bostic obtained a statement for the payoff amount on the loan, which American Home listed as $4,848.23. The payoff amount included a "release fee" and a "recording fee." On February 4, 2005, Bostic sent by certified mail a cashier's check to the order of American Home in the amount of $4,848.23. Three days later, American Home received and signed for Bostic's check. Bostic claimed to have contacted American Home numerous times by telephone to inquire about the release of the payoff documents. According to Bostic, he was informed that the release documents would be sent directly to him and they were in the mail.

On May 16, 2005, American Home sent Bostic a letter, stating the loan "has been paid in full effective 02/11/2005. The payoff release documents will be mailed within 60-90 days from this date." Another letter, with identical wording, was sent by American Home to Bostic on May 18, 2005.

On May 31, 2005, Bostic, through counsel, sent American Home's two locations a certified letter which stated in pertinent part:

As more than 90 days have elapsed since this loan was paid off and the mortgage satisfaction has not been provided to Mr. Bostic nor filed with the court, you are in violation of § 29-3-310, S.C.Code Ann. (2004). I hereby request that you tender, within thirty days, the mortgage satisfaction to our office, along with a penalty check for the amount of $11,237.50, which represents half of the amount of the debt secured by the mortgage, which Mr. Bostic is entitled to pursuant to S.C.Code Ann. (2004) § 29-3-320.

On June 3 and June 6, 2005, both American Home locations respectively received and signed for the two demand letters.

Having received no further response from American Home, Bostic filed a Complaint dated June 14, 2005, in which he alleged the following causes of action: (1) violation of section 29-3-310 of the South Carolina Code; (2) breach of contract with fraudulent intent; and (3) breach of contract. In terms of damages, Bostic sought the statutory penalty provided in sections 29-3-310 and 29-3-320, as well as actual and punitive damages pursuant to the contract claims. In its Answer, dated September 16, 2005, American Home generally denied the allegations and asserted that it had complied with the statutory provisions by filing Bostic's mortgage satisfaction on August 29, 2005.

Both parties filed cross-motions for summary judgment. After a hearing, the circuit court issued an order on March 6, 2006, in which it granted Bostic's motion for summary judgment and denied American Home's motion. Specifically, the court held:

The Court finds, as a matter of law, that the Plaintiff's payment of the payoff amount ($4,848.23) which included the "Release fee" and "Filing fee," which was sent by certified mail, and accepted and retained by Defendant, was sufficient to satisfy the request requirement of § 29-3-310 S.C.Code Ann. (2004). Additionally, taking the evidence in the light most favorable to [American Home], [American Home] failed to comply with its own correspondence which stated that the mortgage satisfaction would be filed within 60-90 days of May 16, 2005.

The Court further finds that [American Home's] failure to file [Bostic's] mortgage satisfaction until August 29, 2005 constitutes a violation of § 29-3-310 S.C.Code Ann. (2004), and subjects [American Home] to the statutory penalty section § 29-3-320 S.C.Code Ann. (2004).

Additionally, the court ordered the parties to schedule a hearing to determine damages. American Home appeals the circuit court's order.¹

STANDARD OF REVIEW

The circuit court may properly grant a motion for summary judgment when "the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." Rule 56(c), SCRCP; Tupper v. Dorchester County, 326 S.C. 318, 325, 487 S.E.2d 187, 191 (1997). "In determining whether any triable issues of fact exist, the circuit court must view the evidence and all reasonable inferences that may be drawn from the evidence in the light most favorable to the non-moving party." RWE NUKEM Corp. v. ENSR Corp., 373 S.C. 190, 644 S.E.2d 730 (2007) (Shearouse Adv. Sh. No. 18 at 21). "`[I]n considering cross motions, the court should draw all inferences against each movant in turn.'" Id. at 24 (quoting 73 Am. Jur.2d Summary Judgment § 43 (2001)). "On appeal from an order granting summary judgment, the appellate court will review all ambiguities, conclusions, and inferences arising in and from the evidence in a light most favorable to the non-moving party below." Vaughan v. McLeod Reg'l Med. Ctr., 372 S.C. 505, ___, 642 S.E.2d 744, 746 (2007).

"The issue of interpretation of a statute is a question of law for the court. We are free to decide a question of law with no particular deference to the circuit court." Catawba Indian Tribe of South Carolina v. State, 372 S.C. 519, ___, 642 S.E.2d 751, 753 (2007) (citations omitted).

DISCUSSION

American Home argues the circuit court erred in holding Bostic's submission of the payoff check satisfied the "request" requirement of the Recording Statutes.²

The Recording Statutes that American Home references are sections 29-3-310 and 29-3-320 of the South Carolina Code.

Section 29-3-310 provides:

Any holder of record of a mortgage who has received full payment or satisfaction or to whom a legal tender has been made of his debts, damages, costs, and charges secured by mortgage of real estate shall, at the request by certified mail or other form of delivery with a proof of delivery of the mortgagor or of his legal representative or any other person being a creditor of the debtor or a purchaser under him or having an interest in any estate bound by the mortgage and on tender of the fees of office for entering satisfaction, within three months after the certified mail, or other form of delivery, with a proof of delivery, request is made, enter satisfaction in the proper office on the mortgage which shall forever thereafter discharge and satisfy the mortgage.

S.C.Code Ann. § 29-3-310 (2007) (emphasis added). In conjunction, section 29-3-320 provides the statutory penalty for those mortgagees that fail to comply with section 29-3-310. Section 29-3-320 states:

Any holder of record of a mortgage having received such payment, satisfaction, or tender as aforesaid who shall not, by himself or his attorney, within three months after such certified mail, or other form of delivery, with a proof of delivery, request and tender of fees of office, repair to the proper office and enter satisfaction as aforesaid shall forfeit and pay to the person aggrieved a sum of money not exceeding one-half of the amount of the debt secured by the mortgage, or twenty-five thousand dollars, whichever is less, plus actual damages, costs, and attorney's fees in the discretion of the court, to be recovered by action in any court of competent jurisdiction within the State. And on judgment being rendered for the plaintiff in any such action, the presiding judge shall order satisfaction to be entered on the judgment or mortgage aforesaid by the clerk, register, or other proper officer whose duty it shall be, on receiving such order, to record it and to enter satisfaction accordingly.

Notwithstanding any limitations under Sections 37-2-202 and 37-3-202, the holder of record of the mortgage may charge a reasonable fee at the time of satisfaction not to exceed twenty-five dollars to cover the cost of processing and recording the satisfaction or cancellation. If the mortgagor or his legal representative instructs the holder of record of the mortgage that the mortgagor will be responsible for filing the satisfaction, the holder of the mortgage shall mail or deliver the satisfied mortgage to the mortgagor or his legal representative with no satisfaction fee charged.

S.C.Code Ann. § 29-3-320 (2007).

Because our decision in this case requires us to determine what constitutes a "request" as referenced in the above-outlined statutes, we are guided by the principles of statutory construction.

"South Carolina has long recognized the principle that penal statutes are to be strictly construed." Hinton v. South Carolina Dep't of Prob., Parole and Pardon Servs., 357 S.C. 327, 332, 592 S.E.2d 335, 338 (Ct.App.2004). "Furthermore, even though penal statutes are to be strictly construed, `the canons of construction certainly allow the court to consider the statute as a whole and to interpret its words in the light of the context.'" Rorrer v. P.J. Club, Inc., 347 S.C. 560, 567, 556 S.E.2d 726, 730 (Ct.App.2001)(quoting State v. Standard Oil Co. of N.J., 195 S.C. 267, 288, 10 S.E.2d 778, 788 (1940)). "We...