Hiraldo v. Banco Popular de P.R. (In re Hiraldo)
| Decision Date | 29 May 2012 |
| Docket Number | Adversary No. 09–00152.,Bankruptcy No. 08–04692 (ESL). |
| Parties | In re Migdalia Valle HIRALDO, Debtor. Migdalia Valle Hiraldo, Plaintiff v. Banco Popular de Puerto Rico, Defendant. |
| Court | U.S. Bankruptcy Court — District of Puerto Rico |
OPINION TEXT STARTS HERE
Juan Manuel Suarez Cobo, Legal Partners PSC, San Juan, PR, for Debtor and Plaintiff.
Vanessa M. Torres Quinones, Martinez & Torres Law Offices, P.S.C., San Juan, PR, for Defendant.
This case is before the court upon the Motion for Summary Judgment filed by defendant Banco Popular de Puerto Rico (as servicing agent for Fannie Mae, hereinafter “BPPR”) praying to be deemed a secured creditor and to deny the Debtor's request to have its secured credit voided (Docket No. 17). Also before the court is Debtor's Opposition [Thereto] and Cross Motion for Summary Judgment (the “ Opposition & Cross Motion ”, Docket No. 35) seeking to void BPPR's mortgage, rendering it an unsecured creditor. For the reasons stated below, BPPR's Motion for Summary Judgment is granted, Plaintiff's Cross Motion is denied and the instant adversary proceeding is hereby dismissed.
On October 10, 2000, the Debtor (along with her former spouse, Reinaldo Villegas Maldonado) executed Deed No. 428 before Notary Public Jesus M. Rivera Delgado to segregate and purchase a real property located at Lot # 3, Block B, Hato Tejas Ward, Bayamon, Puerto Rico (the “Real Property”). Said Deed was filed at the Property Registry on September 15, 2003 at Entry No. 283 of the Daily Entries Book No. 447. See Docket Nos. 23, pp. 6–9, and 60, pp. 7–8 ().
Also on October 10, 2000, the Debtor executed two mortgage deeds to secure two separate liens on the Real Property: (1) Deed No. 207 executed before Notary Public Ahmed Arroyo Romeu to secure a first mortgage in favor of Champion Mortgage Corp. (which was subsequently assigned to BPPR) filed at the Property Registry on September 15, 2003 at Entry No. 284 of the Daily Entries Book No. 447 (the “ Mortgage Deed ”); and (2) Deed No. 429 executed before Notary Public Jesus M. Rivera Delgado to secure a second mortgage in favor of the Puerto Rico PublicHousing Administration (the “PR Housing Administration”) filed at the Property Registry on September 15, 2003 at Entry No. 285 of the Daily Entries Book No. 447. See Docket No. 16, pp. 10–11. Also see Docket No. 60, p. 8 ().
On September 3, 2004, Debtor, along with several of her neighbors, filed a Complaint against the PR Housing Administration and the Commonwealth of Puerto Rico before the Court of First Instance, Superior Court of Bayamon (the “PR Court of First Instance”), Case No. D PE 2004–0752(504), alleging that the defendants had not filed any of the executed segregation and purchase deeds for the registration of their properties at the Property Registry. Plaintiffs in that case, including the Debtor, sought a temporary and permanent injunction relief against defendants, as well as monetary damages. See Docket No. 16, pp. 41–59.
On March 1, 2007, R & G Mortgage Corp. (“R & G”, now BPPR) filed an ordinary foreclosure Complaint (“demanda de ejecución de hipoteca por la vía ordinaria”) against the Debtor and her former husband before the Court of First Instance, Superior Court of Bayamon, Case No. D CD 2007–0623(503), alleging that the Debtor (and her husband) had defaulted on their mortgage payments. See Docket No. 36, pp. 7–9. On or about September 18, 2007, R & G (now BPPR) filed a Motion informing that its mortgage had not then been recorded at the Property Registry and thus requested the entry of a collection of monies judgment. See Docket No. 36, pp. 10–11. On October 8, 2007, notified and docketed on November 5, 2007, the PR Court of First Instance issued a Collection of Monies Judgment against the Debtor and her former husband, in the amount of $54,958.73, including principal, interests and late fees, $5,350.00 in attorneys fees and a fixed annual interest rate at 12.00%. See Docket No. 36, pp. 12–16. On December 6, 2007, R & G filed a Motion for a lis pendens lien on the Debtor's Real Property under Puerto Rico's former Civil Procedure Rule 56.4, 32 L.P.R.A. Ap. III R. 56.4 1, to which Debtor opposed on or about January 11, 2008. See Docket No. 36, pp. 17–19 and 20–21. On December 20, 2007, the PR Court of First Instance issued an Order granting the lien requested by R & G, and on January 8, 2008, issued the corresponding Writ of execution ordering the Property Registrar to record a lien over the Debtor's Real Property (Docket No. 36, pp. 24 & 25–26). On May 1, 2008, the PR Court of First Instance issued an Order to its Marshal to hold a public auction to sell the Debtor's Real Property in execution of the Collection of Monies Judgment (Docket No. 36, pp. 29–30). On May 16, 2008, the Debtor filed a Motion to set aside the Order authorizing the lien requested by R & G (Docket No. 36, pp. 31–33).
On July 21, 2008, the Debtor filed a Chapter 13 Bankruptcy Petition (Lead Case Docket No. 1).
On June 2, 2009, the Debtor, along with the rest of the co-plaintiffs in Case No. D PE2004–0752 (504), signed a Stipulation of Judgment by Settlement with the PR Housing Administration whereby plaintiffs would receive a total amount of $140,400.00 for all the alleged damages and defendants would take all the necessary actions to have all the purchase deeds filed and registered at the Property Registry within 6 months (Docket No. 16, p. 50–59). On June 12, 2009, notified and docketed on June 22, 2009, the PR Court of First Instance issued a Settlement Judgment approving said Stipulation (Docket No. 16, pp. 56–59).
On August 11, 2009, the Debtor filed the instant Complaint alleging that BPPR has not perfected its mortgage lien on her Real Property and therefore its Claim 2–1 should be reclassified as unsecured (Docket No. 1). On December 7, 2009, BPPR filed its Answer to the Complaint (Docket No. 11) alleging that a title search performed at that time revealed that the Property Registry had not notified any defects that could impair BPPR's Mortgage Deed and that the fact that a mortgage deed that has been filed but not yet not recorded, absent of a finding or notice of error in the mortgage deed, does not render BPPR an unsecured creditor.
On December 8, 2009, a pre-trial hearing was held in which the court granted the parties 60 days to conclude discovery. A continuance was scheduled for March 5, 2010 at 9:30 a.m. (Docket No. 14).
On March 2, 2010, BPPR filed the Motion for Summary Judgment along with its Statement of Uncontested Facts (Docket Nos. 17 & 16, respectively). BPPR sustains that the Mortgage Deed was filed at the Property Registry on September 15, 2003, without the Registrar having notified any defects on it, which had been pending registration in the Property Registry's back-log ever since. Consequently, BPPR argues that pursuant to Sections 362(b)(3), 506 and 547 of the Bankruptcy Code and this court's decision in Soto–Ríos v. BPPR (In re Soto–Ríos), 420 B.R. 57 (Bnkr.D.P.R.2009)2, it is a secured creditor.
On March 5, 2010, the continuation of the pre-trial was held and was continued without a date pending a decision on BPPR's Motion for Summary Judgment. Debtor was granted 20 days to file her opposition (Docket No. 18).
On April 12, 2010, BPPR filed a Motion Submitting Documents in Support of [its] Motion for Summary Judgment (Docket No. 23).
On June 21, 2010, Debtor filed her Opposition & Cross Motion for summary judgment along with its Statement of ... Uncontested Facts (Docket Nos. 35 & 36). The Debtor alleges that BPPR “abandoned” the execution of its mortgage foreclosure cause of action because since the Mortgage Deed had not registered at the Property Registry, it decided and requested from the PR Court of First Instance to only continue a personal collection of monies judgment instead (Docket No. 35, p. 9, referring to Docket No. 36, pp. 10–11). Based on the “abandonment” argument, the Debtor also purports that the res judicata doctrine precludes BPPR from foreclosing the Debtor's mortgage based on the decision by the Supreme Court of Puerto Rico in Banco de la Vivenda v. Carlo Ortiz, 130 D.P.R. 730 (1992). Additionally, and also following the “abandonment” premise, Debtor sustains that the PR Court of First Instance's Order granting the judicial lien is null because it was issued without a hearing contrary to the Puerto Rico Supreme Court's decision in Rivera Rodriguez & Co. v. Lee Stowell Taylor, 133 D.P.R. 881 (1993).
On December 10, 2010, the Court issued an Order & Notice scheduling a hearing for February 8, 2011 to consider the motions for summary judgment and oppositions filed by BPPR and Debtor, which was subsequently rescheduled for May 11, 2011 (Docket Nos. 48, 50, 52, 54 & 55). In that hearing, the court ordered the parties to inform the court whether the Stipulation in Case No. D PE2004–0752 (504) before the PR Court of First Instance had been complied with by the PR Housing Administration to ensure that the properties were recorded in plaintiffs' name, including the Debtor.
On July 12, 2011, BPPR filed a Motion in Compliance with Order (Docket No. 60) including an updated Certification issued by the Property Registrar on May 25, 2011 that reveals that BPPR's Mortgage Deed had been filed since September 13, 2003 and that no defects had been notified to that effect as to that date.
On September 7, 2011, the court issued an Order (Docket No. 64) for Debtor to show cause within 21 days why the instant Complaint should not be dismissed for failure to comply with this court's order of May 11, 2011 (Docket No. 58) and defendant...
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