NationsBank of Georgia v. Conifer Asset Management Ltd.
Decision Date | 04 April 1996 |
Docket Number | No. 95CA0031,95CA0031 |
Citation | 928 P.2d 760 |
Parties | NATIONSBANK OF GEORGIA, National Association, a national banking association, Plaintiff-Appellant, v. CONIFER ASSET MANAGEMENT LTD., a Colorado limited liability company, Defendant-Appellee. . II |
Court | Colorado Court of Appeals |
Faegre & Benson, Michael S. McCarthy, Christian C. Onsager, John R. Sperber, Denver, for Plaintiff-Appellant.
Doherty, Rumble & Butler, P.C., Garry R. Appel, Denver, for Defendant-Appellee.
Opinion by Judge DAVIDSON.
Plaintiff, NationsBank of Georgia, appeals from a trial court judgment which vacated a decree of foreclosure. The trial court found that plaintiff had waived default on a note by accepting subsequent payments and was, therefore, precluded from foreclosing against defendant, Conifer Asset Management Ltd. We reverse.
Plaintiff is the successor trustee for revenue bonds which were used to finance acquisition and construction of an apartment complex in Adams County. As trustee, plaintiff became holder of a note for $7,425,000 and deed of trust (first note and first deed). The Federal National Mortgage Association ( FNMA ), holder of the bonds and beneficiary and servicing agent of the first note, obtained a second priority note and deed of trust encumbering the property for approximately $49,000 (second note and second deed).
The first owner of the property absconded with rents and defaulted on the first note in July 1991. Because a default under the first note was also a default under the second note, FNMA notified the owner of a default under both notes and of its intention to accelerate the second note. Also at FNMA's request, the court appointed a receiver, who collected rents and started making the required monthly payments on the first note in September 1991. The second deed was foreclosed in December 1991 and the property redeemed from the foreclosure sale by defendant, a junior lienor.
Thereafter, in March 1992, plaintiff, then a recently named successor trustee on the first note and deed, gave notice to defendant of its intent to accelerate the first note. The trial court granted a foreclosure decree in December 1992. Defendant filed an appeal to this court and, subsequently, moved the trial court for a stay pending appeal. Both the trial court and this court refused to grant a stay without the posting of a supersedeas bond. After failure of defendant to post the bond, the property was sold at foreclosure sale to plaintiff, and defendant failed to redeem.
In February 1994, a division of this court issued an opinion vacating the December 1992 order and remanding for further findings on the defense of waiver and entry of a new order. See Federal National Mortgage Ass'n v. Conifer Asset Management, Ltd., (Colo.App. No. 93CA0160, Feb. 3, 1994) (not selected for official publication) (Conifer I ). Plaintiff did not seek certiorari review. While the division was aware that the trial court had authorized a foreclosure sale, neither party notified the division that the sale had occurred or argued that the case was moot.
The parties briefed the issues for a remand hearing, but no new evidence was admitted. In its order on remand of September 1994, the trial court found that plaintiff had waived its right to foreclose by accepting payments after the July 1991 default. Accordingly, the trial court vacated its March 1992 decree of foreclosure and this appeal followed.
Relying on Mt. Carbon Metropolitan District v. Lake George Co., 847 P.2d 254 (Colo.App.1993), plaintiff initially contends that this appeal must be dismissed because the property at issue vested in plaintiff pursuant to § 38-38-501, C.R.S. (1995 Cum.Supp.). Specifically, plaintiff argues, there was no live controversy to be decided either on remand or in this appeal because defendant lost all title, right, or interest in the property when the post-foreclosure sale redemption period expired in August 1993. We decline to dismiss the appeal.
Generally, an appellate court will not render an opinion on the merits of an appeal if issues presented in litigation become moot because of subsequent events. A case is moot when a judgment would have no practical effect upon an existing controversy. American Drug Store, Inc. v. Denver, 831 P.2d 465 (Colo.1992).
Here, however, even if, arguendo, the case was moot when Conifer I was decided, we will not dismiss the appeal on that basis. See Mt. Carbon Metropolitan District v. Lake George Co., supra; see also § 38-38-501. But see FCC Construction, Inc. v. Casino Creek Holdings, Ltd., 916 P.2d 1196 (Colo.App.1996) (declining to follow Mt. Carbon Metropolitan District ).
First, when the division rendered its opinion in Conifer I, it had not been informed that defendant no longer had an interest in the property. Thus, Conifer I properly was decided without regard to the question of mootness. See Robinson v. California, 371 U.S. 905, 83 S.Ct. 202, 9 L.Ed.2d 166 (1962) ( ); see also Cardinal Chemical Co. v. Morton International, Inc., 508 U.S. 83, 113 S.Ct. 1967, 124 L.Ed.2d 1 (1993) ( ).
Secondly, since Conifer I vacated the trial court's original order, a live controversy existed between the parties at the time of the trial court's September 1994 order. And, there is no contention that events have occurred subsequent to September 1994 to render the case moot.
Third, in addition to its failure to alert the Conifer I court of the possibility that the case was moot, plaintiff did not raise the issue in a petition for certiorari following the Conifer I decision. See Van Schaack Holdings, Ltd. v. Fulenwider, 798 P.2d 424 (Colo.1990) ( ). And, because the issue of mootness was not raised, a mandate issued in due course in April 1994 and the court of appeals' judgment vacating the trial court's December 1992 order became final.
The determination of mootness maintains an element of discretion. See Humphrey v. Southwestern Development Co., 734 P.2d 637 (Colo.1987) ( ); cf. Van Schaack Holdings, Ltd. v. Fulenwider, supra ( ); In re Marriage of Finer, 893 P.2d 1381 (Colo.App.1995) (analyzing mootness determinations). To the extent that we may so exercise our discretion, and in consideration of the doctrine of equitable estoppel, see Oken v. Hammer, 791 P.2d 9 (Colo.App.1990) ( ), under the particular circumstances here, we decline to invoke the mootness doctrine now and choose to resolve the issues presented.
Alternatively, plaintiff contends that the trial court erred in finding that defendant had established the defense of waiver. Plaintiff asserts that, as a matter of law, waiver cannot be inferred merely from the acceptance of payments from the receiver, acting under the terms of the July 1991 appointment order, because its conduct subsequent to the July 1991 default was not inconsistent with its right to foreclose on the first deed and note. We agree.
Waiver is the intentional relinquishment of a known right or privilege. Waiver may be explicit, or it may be implied by a party's conduct if the conduct is unambiguous and clearly manifests an intention not to assert the right or if it is inconsistent with assertion of the right. Department of Health v. Donahue, 690 P.2d 243 (Colo.1984). Waiver may be determined as a matter of law only when the material facts are not in dispute, see Duran v. Housing Authority, 761 P.2d 180 (Colo.1988); otherwise, waiver is a factual determination for the trial court. Grimm Construction Co. v. Denver Board of Water Commissioners, 835 P.2d 599 (Colo.App.1992).
Here, there is no contention that plaintiff or FNMA explicitly waived the right to foreclose in their communications after the default. Under certain circumstances, however, the waiver of such right may be inferred from the acceptance of payments without reservation. See Motlong v. World Savings & Loan Ass'n, 168 Colo. 540, 452 P.2d 384 (1969); Colorado Kenworth Corp. v. Whitworth, 144 Colo. 541, 357 P.2d 626 (1960); see also Goodwin v. District Court, 779 P.2d 837 (Colo.1989) ( ); cf. Landy v. Jordan, 129 Colo. 140, 266 P.2d 1115 (1954).
Relying on such principles, defendant argues that the acceptance of payments from the receiver by FNMA and plaintiff constituted waiver of their right to foreclose. We disagree.
First, FNMA and plaintiff consistently asserted through their actions subsequent to the default that the first note and deed remained subject to acceleration and foreclosure. Specifically, it is undisputed that, in July 1991, FNMA notified the debtor of default under the first and second notes and that the second deed was due and payable based on this default. In its motion for appointment of a receiver in July 1991, FNMA reiterated existence of the default and its intent to commence non-judicial foreclosure on the second deed.
In addition, in objections to defendant's motion to discharge the receiver in February 1992, FNMA reiterated its contention that a default still existed under the first note and deed and requested that the receiver be retained for foreclosure action under the first deed. Finally, in March 1992, plaintiff again notified defendant that the first note was still...
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