Nationstar Mortg. LLC v. Chenoweth
| Decision Date | 02 April 2018 |
| Docket Number | NO. A-1-CA-35696,A-1-CA-35696 |
| Parties | NATIONSTAR MORTGAGE LLC, Plaintiff, v. DANIEL CHENOWETH , a/k/a DANIEL L. CHENOWETH, TAMMY CHENOWETH, AUTOMATED RECOVERY SYSTEMS OF NEW MEXICO, INC., CAVALRY SPV I LLC AAO HSBC BANK NEVADA N.A., ORCHARD BANK, and MORTGAGE ELECTRONIC REGISTRATION SYSTEMS, INC., AS NOMINEE FOR AMERICAN MORTGAGE EXPRESS FINANCIAL d/b/a MILLENNIUM FUNDING GROUP, Defendants, TAL REALTY, INC., Petitioner-Appellant, v. CODY C. MOBLEY, LARRY K. MOBLEY, and VEDA J. MOBLEY, Respondents-Appellees. |
| Court | Court of Appeals of New Mexico |
This memorandum opinion was not selected for publication in the New Mexico Appellate Reports. Please see Rule 12-405 NMRA for restrictions on the citation of unpublished memorandum opinions. Please also note that this electronic memorandum opinion may contain computer-generated errors or other deviations from the official paper version filed by the Court of Appeals and does not include the filing date.
APPEAL FROM THE DISTRICT COURT OF SAN JUAN COUNTY
Marrs Griebel Law Ltd.
Clinton W. Marrs
Albuquerque, NM
for Appellant
The Risley Law Firm P.C.
Gary Risley
Farmington, NM
Lorenz Law
Alice T. Lorenz
Albuquerque, NM
for Appellees
{1} TAL Realty, Inc. (TAL Realty) appeals the district court's entry of judgment against it in this foreclosure redemption case. On appeal, TAL Realty argues that the assignees of the first priority right of redemption, who were also the foreclosure sale purchasers, did not timely exercise their redemption right because they did not record the assignment evidencing the redemption with the county clerk's office, contrary to NMSA 1978, Section 39-5-23 (2013), within the one-month redemption period. We affirm and also conclude, under the facts of this case, that TAL Realty was notdivested of its right to appeal when it withdrew the funds it deposited in the district court's registry, pursuant to NMSA 1978, Section 39-5-18(A)(2) (2007).
{2} The following facts are not disputed. Nationstar Mortgage LLC filed a complaint for foreclosure against property owners, Daniel and Tammy Chenoweth (the Chenoweths) and various other junior lienholders, including Automated Recovery Systems of New Mexico, Inc. (ARSNM), which held a subordinate judgment lien against the subject real property located in San Juan County. On March 6, 2015, the district court entered a stipulated and default judgment for foreclosure and order of sale. The court ordered the property sold at a special master's sale and stated that, pursuant to NMSA 1978, Section 39-5-19 (1965) and paragraph twenty-four of the mortgage agreement, the redemption period after judicial sale was one month.
{3} On April 15, 2015, Cody Mobley, acting as designee of his parents Larry and Veda Mobley (the Mobleys), successfully bid $235,998 at the special master's sale, and the property was conveyed to the Mobleys by a special master's deed subject to the one-month right of redemption. The order confirming sale was entered on May 7, 2015. The one-month redemption period was thus set to expire June 7, 2015. See § 39-5-18(A), (E) (). Also on May 7, 2015, the Chenoweths assigned their first priority right of redemption to the Mobleys.
See § 39-5-18(A)(3) (). Cody Mobley filed the assignment with the district court that same day; however, he did not deliver it to the San Juan County Clerk's Office until over seven months later, on January 14, 2016, at which point he also recorded a formal notice of exercise of the redemption right.
{4} On May 28, 2015, ARSNM assigned its junior lien on the subject property to TAL Realty. The assignment included any subordinate rights of redemption. See id. (). On Monday, June 8, 2015, the first business day following June 7, TAL Realty filed a petition for redemption in the district court pursuant to Section 39-5-18(A)(2). See generally U.S. Bank Nat'l Ass'n v. Martinez, 2003-NMCA-151, ¶¶ 3, 8, 134 N.M. 665, 81 P.3d 608 (). TAL Realty also moved for authorization to deposit funds into the court registry in the amount the Mobleys paid at the special master's sale, plus statutory interest. The district court granted TAL Realty's petition and motion until the parties' rights could be determined by further order of the court, and TAL Realty deposited the funds. The Mobleys responded to TAL Realty's petition arguing that it should be denied because the Mobleys "purchased the propertyat [the] foreclosure sale and purchased the primary [r]edemption [r]ights" and that they had "exercised these rights and provided notice."
{5} TAL Realty subsequently moved for summary judgment on the grounds that "there [was] no genuine dispute as to any fact material to the redemption petition and TAL Realty is entitled to judgment in its favor as a matter of law." Specifically, TAL Realty argued that it timely exercised its right of redemption, as an assignee of a junior lienholder, by petitioning the district court for redemption and depositing the redemption amount in the court registry. TAL Realty further argued that the Mobleys failed to exercise the right of redemption the Chenoweths assigned to them because the Mobleys never recorded the assignment in the San Juan County Clerk's Office, which was true as of the date TAL Realty moved for summary judgment.
{6} The Mobleys responded to TAL Realty's motion for summary judgment after they recorded the assignment and formal notice of their exercise of the redemption right with the San Juan County Clerk's Office. They argued that they exercised the right of redemption by filing the Chenoweths' assignment of their first priority right of redemption with the district court within the one-month redemption period. Moreover, "[a] court-certified version of the assignment ha[d] also been filed in the deed of records of San Juan County." The Mobleys maintained that they outbid TAL Realty for the Chenoweths' first priority right of redemption and that TAL Realty therefore had notice of the Mobleys' intention to redeem. Thus, the Mobleys arguedthat summary judgment should be denied because they complied with the redemption process and TAL Realty had actual notice that they exercised the right of redemption, or in the alternative, that they substantially complied with the redemption process.
{7} After a hearing the district court denied TAL Realty's motion for summary judgment. The court found that there was no genuine dispute of material fact but that TAL Realty was not entitled to judgment as a matter of law. In particular, the court found that "the Mobleys' redemption of the property out of foreclosure was immediately consummated by operation of law" because they were assignees of the Chenoweths' first priority right of redemption. The district court also stated, pursuant to Section 39-5-18(A), that "[j]ust as the Chenoweth[s] . . . might have redeemed the property by making the appropriate payment, the Mobleys, who stood in their shoes by virtue of the assignment from the Chenoweths, had also redeemed the property having already made an appropriate payment for property." See § 39-5-18(A)(1) (). Lastly, the court concluded that Section 39-5-23(B) did not provide a time frame for which the Mobleys were supposed to record documentation that they exercised their redemption right with the San Juan County Clerk's Office. See § 39-5-23(B) ().
{8} The district court thereafter entered a judgment for the Mobleys and ordered that the funds deposited into the court registry by TAL Realty be returned to TAL Realty. This appeal followed.
{9} At the outset, we address whether TAL Realty has a right to appeal from the district court's denial of summary judgment and entry of judgment in favor of the Mobleys. Whether a party has a right to appeal is a question of law that we review de novo. See State v. Armijo, 2016-NMSC-021, ¶ 19, 375 P.3d 415 (). According to the Mobleys, "TAL Realty's withdrawal of funds from the court registry divest[ed] it of standing" to appeal to this Court. The Mobleys maintain that standing is jurisdictional because "TAL Realty is asserting a claim created by statute that accords a right to judicial relief only to those that have, on deposit in the court registry, the required funds." See § 39-5-18(A)(2) (); see also PhoenixFunding, LLC v. Aurora Loan Servs., LLC, 2017-NMSC-010, ¶ 19, 390 P.3d 174 ().
{10} The cases primarily relied on by the Mobleys for support, however, pertain to whether a plaintiff has standing to bring a cause of action in the district court, not standing to appeal. See, e.g., Am. Civil Liberties...
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