Farkas v. Aurora Loan Servs., L.L.C.
| Decision Date | 30 May 2017 |
| Docket Number | No. 05-15-01225-CV,05-15-01225-CV |
| Parties | JANOS FARKAS, Appellant v. AURORA LOAN SERVICES, L.L.C., AURORA BANK FSB, FEDERAL NATIONAL BANK ASSOCIATION, AND JINNI GONZALEZ, Appellees |
| Court | Texas Court of Appeals |
On Appeal from the 134th Judicial District Court Dallas County, Texas
Before Justices Lang, Brown, and Whitehill
Opinion by Justice Lang
Janos Farkas, pro se, appeals the trial court's final take-nothing judgment on his claims for wrongful foreclosure, suit to quiet title, and violation of section 12.002 of the Texas Civil Practice and Remedies Code in favor of Aurora Loan Services, L.L.C., Aurora Bank FSB (collectively Aurora), Federal National Mortgage Association (commonly known as Fannie Mae), and Jinni Gonzalez. Farkas raises six issues on appeal, arguing the evidence is legally and factually insufficient to support the trial court's findings of fact and the trial court erred when it made conclusions of law that: (1) the pre-foreclosure notices satisfied the deed of trust and section 51.002(d) of the Texas Property Code as to his claim for wrongful foreclosure against Aurora; (2) the notice of default in Joint Exhibit No. 11 satisfied all of the requirements of the deed of trust and section 51.002 of the Texas Property Code as to his wrongful-foreclosure claim against Aurora; (3) Aurora conducted a legal and valid non-judicial foreclosure as to his claim for wrongful foreclosure against Aurora; (4) Gonzalez proved her affirmative defense that she was a bona fide purchaser as to the suit to quiet title against her; (5) Farkas has no legal or equitable interest in the property and he is not entitled to a suit to quiet title against Aurora, Fannie Mae, and Gonzalez; and (6) Fannie Mae did not violate section 12.002 of the Texas Civil Practice and Remedies Code.
We conclude the evidence is legally and factually sufficient to support the trial court's findings of fact. Also, we conclude the trial court did not err in its conclusions of law. The trial court's final take-nothing judgment is affirmed.
On January 2, 2007, Farkas purchased condominium Unit 608 located at 122 Jackson Street, Dallas, Texas 75202. Farkas funded his purchase of Unit 608 by executing a promissory note, specifying WR Starkey Mortgage as the lender. The note obligated Farkas to pay monthly principal and interest on the first day of each month beginning February 1, 2007 through the maturity date of January 1, 2037. To secure the note, Farkas also executed a deed of trust identifying WR Starkey as the lender.
On January 31, 2007, WR Starkey sold and transferred the Unit 608 loan to Aurora Bank. Then, Aurora Bank sold the Unit 608 loan to Fannie Mae by way of a standing purchase sale agreement and amendment. On February 9, 2009, the servicing rights relating to the Unit 608 loan were "assigned, transferred, or sold" to Aurora Loan Services, which sale became effective on March 1, 2007. These servicing rights included the right to collect payments and foreclose on Unit 608.
On June 17, 2010, Aurora Loan Services mailed a letter to Farkas notifying him that the loan was in default for the payment due on May 1, 2010. Farkas received the June 17, 2010letter, but made no payment on the Unit 608 loan in June 2010. However, on July 16, 2010, Farkas made a payment on the loan, which was credited to the monthly installment that was due on May 1, 2010.
On July 22, 2010, Aurora Loan Services mailed Farkas a second notice of default, relating to the payment due on June 1, 2010. Farkas received the July 22, 2010 letter. On August 11, 2010, Farkas made another payment on the loan, which was credited to the monthly installment due on June 1, 2010.
On August 19, 2010, Aurora Loan Services mailed Farkas a third notice of default, relating to the payment due on July 1, 2010. Farkas received the August 19, 2010 letter. On September 13, 2010, Farkas made another payment on the loan, which was credited to the monthly installment due on July 1, 2010.
On September 16, 2010, Aurora Loan Services mailed Farkas a fourth notice of default, relating to the payment due on August 1, 2010. Again, Farkas received the September 16, 2010 notice of default. On October 29, 2010, Farkas made another payment on the loan, which was credited to the monthly installment due on August 1, 2010.
On November 2, 2010, Aurora Loan Services mailed Farkas a fifth notice of default, relating to the payment due on September 1, 2010. Farkas did not pay the monthly installment due for September 1, 2010 or any of the monthly installments due afterward.
On December 31, 2010, Mann & Stevens, P.C., sent Farkas a demand letter, which Farkas received. On January 27, 2011, McCarthy, Holthus & Ackerman, L.L.P., sent Farkas a letter notifying him that it had been retained by Aurora Loan Services to initiate foreclosure proceedings. Farkas received the January 27, 2011 letter. Then, on February 7, 2011, McCarthy, Holthus & Ackerman sent Farkas a letter that was accompanied by a notice of substitute trustee sale, which notified Farkas that a foreclosure sale on Unit 608 was scheduled for March 1, 2011.Farkas received the February 7, 2011 letter and the notice of substitute trustee sale for March 1, 2011 was recorded with the County Clerk, Dallas County, Texas on February 8, 2011. On February 14, 2011 and February 21, 2011, Farkas sent letters to McCarthy, Holthus & Ackerman. Also, on February 24, 2011, Farkas, pro se, filed his original petition against Aurora Loan Services seeking a declaratory judgment and a temporary restraining order. On February 28, 2011, the trial court granted Farkas's application for a temporary restraining order. As a result, the March 1, 2011 foreclosure sale did not occur. The temporary restraining order expired by its terms on March 10, 2011.
On May 12, 2011, McCarthy, Holthus & Ackerman sent Farkas a letter, acknowledging receipt of Farkas's letters, stating that Aurora Loan Services determined the balances due are accurate, and advising Farkas that it had been instructed by Aurora Loan Services to proceed with foreclosure. Farkas received the May 12, 2011 letter.
On May 13, 2011, McCarthy, Holthus & Ackerman sent Farkas another notice of substitute trustee sale, which notified Farkas that a foreclosure sale on Unit 608 was scheduled for June 7, 2011. Farkas received the May 13, 2011 notice, which was subsequently recorded with the Dallas County Clerk on May 16, 2011.
On June 7, 2011, a foreclosure sale was held on Unit 608. Aurora Loan Services was the winning bidder with a credit bid of $168,479.03, which represented the entire amount of the indebtedness Farkas owed on the Unit 608 note at the time of the sale. At the time of foreclosure, the appraised value of the property was $94,790. On June 16, 2011, the substitute trustee's deed and corresponding affidavit were filed in the real property records of Dallas County. On June 17, 2011, Aurora Loan Services executed a special warranty deed naming Fannie Mae as grantee, which was also filed in the real property records of Dallas County.
The record before us does not show when, but at some point, Farkas amended his pro se petition to allege claims against Aurora Bank and Fannie Mae as well as Aurora Loan Services and to allege the additional claims of verification of debt, violations of the Texas Civil Practice and Remedies Code, violations of the Texas Debt Collection Act, violations of the Texas Deceptive Trade Practices Act, wrongful foreclosure, and a suit to quiet title. See Farkas v. Aurora Loan Servs., L.L.C., No. 05-12-01095-CV, 2013 WL 6198344, at *1 (Tex. App.—Dallas Nov. 26, 2013, pet. denied) (mem. op.). Aurora and Fannie Mae answered the lawsuit and asserted counterclaims for breach of contract, defamation and business disparagement, and malicious prosecution, which were subsequently dismissed without prejudice by nonsuit. Aurora and Fannie Mae filed a joint no-evidence and traditional motion for summary judgment, which the trial court granted. See Farkas, 2013 WL 6198344, at *1. On appeal, this Court reversed the trial court's summary judgment on Farkas's claims for wrongful foreclosure and suit to quiet title, remanding those claims to the trial court for further proceedings, and affirmed the remainder of the trial court's summary judgment. See Farkas, 2013 WL 6198344, at *5.
In 2013, Gonzalez agreed to purchase Unit 608 from Fannie Mae for $137,000. Before purchasing Unit 608, Gonzalez was aware that it had been previously sold at a foreclosure sale. After purchasing the condominium, Gonzalez has occupied Unit 608 as her primary residence.
After the remand, on December 2, 2014, Farkas filed his sixth amended petition adding Gonzalez as a party to the lawsuit, abandoning his claim for wrongful foreclosure, and asserting a suit to quiet title against Aurora Loan Services, Fannie Mae, and Gonzalez, and a claim for violation of Texas Civil Practice and Remedies Code section 12.002 against Fannie Mae.1 Although Farkas's sixth amended petition continued to name Aurora Bank as a party, he did notassert any claims against Aurora Bank. Gonzalez answered and asserted the affirmative defense that she was a bona fide purchaser.
On July 1, 2015, a bench trial was held. Farkas, Aurora Loan Services, Aurora Bank, Fannie Mae, and Gonzalez all appeared. During the trial, the parties offered into evidence several joint exhibits. One of the joint exhibits was the parties' joint stipulations of fact and agreed propositions of law. On July 8, 2015, the trial court signed a take-nothing judgment on all of Farkas's claims and specifically noted that "'Farkas's claims for wrongful foreclosure and suit to quiet title' have been tried." On August 26, 2015, the trial court signed it's written findings of fact and conclusions of law. This appeal followed.
In issues one through six, Farkas challenges the...
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