Pittman v. Regions Bank

• Decision Date: 02 December 2016
• Docket Number: 2150455.
• Citation: 226 So.3d 193
• Parties: Windham Todd PITTMAN, Rhonda Pittman, and Jonathan Pittman v. REGIONS BANK d/b/a Regions Mortgage
• Court: Alabama Court of Civil Appeals

226 So.3d 193

Windham Todd PITTMAN, Rhonda Pittman, and Jonathan Pittman

v.REGIONS BANK d/b/a Regions Mortgage

2150455.

Court of Civil Appeals of Alabama.

Dec. 2, 2016

Kenneth James Lay of Hood & Lay LLC, Birmingham, for appellants.

J. Marshall Gardner and J. Ben Segarra of Maynard, Cooper & Gale P.C., Mobile, for appellee.

THOMPSON, Presiding Judge.

Windham Todd Pittman ("Windham"), Rhonda Pittman ("Rhonda"), and Jonathan Pittman (hereinafter referred to collectively as "the Pittmans") appeal from a summary judgment entered in favor of Regions Bank, doing business as Regions Mortgage ("Regions"), in its ejectment action against the Pittmans. Specifically, Regions sought to recover possession of certain real property in Daleville ("the property") that had been foreclosed upon and that was occupied by the Pittmans.

The evidentiary submissions the parties filed in support of and in opposition to Regions' motion for a summary judgment indicate the following. Land Ventures for 2, LLC ("Land Ventures")(which is not a party to this appeal), Windham, and Rhonda (hereinafter referred to collectively as "the borrowers") obtained a $650,000 loan from Access Mortgage Corporation ("Access") to purchase the property. On April 15, 2008, Windham, both as the managing member of Land Ventures and in his individual capacity, and Rhonda executed a promissory note, which was secured by a mortgage on the property. The mortgage was executed only by Windham as the managing member of Land Ventures. On June 29, 2009, Windham, again both as the managing member of Land Ventures and in his individual capacity, executed a loan-modification agreement. That agreement was among Land Ventures as the borrower, Regions as the lender or mortgage servicer, and Mortgage Electronic Registration Systems, Inc. ("MERS"), solely as the nominee for the "lender and lender's successors and assigns," as the mortgagee. On May 7, 2010, MERS, acting solely as nominee for Access, assigned the mortgage and the note to Regions.

It is undisputed that the borrowers failed to make the required monthly payments. Steven Purser, a vice president of Regions who serves as the manager of the "Real Estate Owned" Department, testified in his affidavit that Regions last received a payment from the borrowers on August 5, 2011. That payment had been due in April 2010, Purser said.

Windham submitted three affidavits at different times to oppose Regions' motion for a summary judgment. In his affidavits, Windham testified that he did not receive proper notice of the default and that was he was not given an opportunity to cure the default. He also stated that he was not provided with proper notice of intent to accelerate, proper notice of acceleration, or proper notice of the foreclosure sale, which, he says, was required by law and by the mortgage contract. Windham also listed a number of other items that he says he should have received before foreclosure was proper. No documents from Regions to the borrowers indicating Regions' intent to accelerate the note or to foreclose on the property are contained in the record before us.

In an affidavit, Windham also estimated that the property had a market value of approximately $658,000. In at least one of his affidavits, Windham said that his opinion was based on his knowledge of the neighborhood and the house, the corresponding values of similar properties in the neighborhood, and recent sales of similar properties. Windham testified that the property included six separate parcels that he described as "distinct" and not contiguous. One of the parcels included the Pittmans' residence.

In his affidavits, Windham stated that he had asked Regions to sell the property in separate parcels rather than en masse. Windham opined that the property would have sold for more money if the individual parcels making up the property had been sold separately. He also said that, had the parcels been sold separately, he "could have potentially redeemed just the parcel where my family's home is located." Regions refused his request, Windham said.

Regions began foreclosure proceedings on the property in 2012. After publication of the appropriate notices in a Geneva County newspaper, the foreclosure sale was held on March 7, 2013. Purser testified that Regions submitted the highest and best bid of $367,500 and that the property was sold to Regions pursuant to the power-of-sale clause contained in the mortgage. The foreclosure deed, dated March 7, 2013, is included in the record. We note that the foreclosure deed includes the six parcels discussed in Windham's affidavits. On March 7, 2013, attorneys for Regions sent a letter to Land Ventures, in care of Windham, demanding that the property be vacated within ten days. The Pittmans did not vacate at least the parcel on which their house was located, and Regions filed this ejectment action on October 28, 2014, seeking the Pittmans' removal.

After a hearing on Regions' motion for a summary judgment and after allowing the parties to file supplemental submissions, the trial court entered a summary judgment in favor of Regions on November 9, 2015. The Pittmans filed a timely motion to alter, amend, or vacate the judgment, which the trial court denied on January 14, 2016. The Pittmans appealed the judgment to the Alabama Supreme Court, which transferred the appeal to this court pursuant to § 12–2–7(6), Ala. Code 1975.

On appeal, as they did before the trial court, the Pittmans raise a number of challenges to the validity of the underlying foreclosure. They assert that, in their evidentiary submission in opposition to Regions' motion, they raised a number of factual questions that Regions failed to refute with evidence of its own. Therefore, the Pittmans argue, the trial court erred in entering a summary judgment in favor of Regions.

"This Court's review of a summary judgment is de novo. Williams v. State Farm Mut. Auto. Ins. Co., 886 So.2d 72, 74 (Ala. 2003). We apply the same standard of review as the trial court applied. Specifically, we must determine whether the movant has made a prima facie showing that no genuine issue of material fact exists and that the movant is entitled to a judgment as a matter of law. Rule 56(c), Ala. R. Civ. P.; Blue Cross & Blue Shield of Alabama v. Hodurski, 899 So.2d 949, 952–53 (Ala. 2004). In making such a determination, we must review the evidence in the light most favorable to the nonmovant. Wilson v. Brown, 496 So.2d 756, 758 (Ala. 1986). Once the movant makes a prima facie showing that there is no genuine issue of material fact, the burden then shifts to the nonmovant to produce ‘substantial evidence’ as to the existence of a genuine issue of material fact. Bass v. SouthTrust Bank of Baldwin County, 538 So.2d 794, 797–98 (Ala. 1989) ; Ala. Code 1975, § 12–21–12. ‘[S]ubstantial evidence is evidence of such weight and quality that fair-minded persons in the exercise of impartial judgment can reasonably infer the existence of the fact sought to be proved.’ West v. Founders Life Assur. Co. of Fla., 547 So.2d 870, 871 (Ala. 1989)."

Dow v. Alabama Democratic Party, 897 So.2d 1035, 1038–39 (Ala. 2004).

Regions filed its ejectment action against the Pittmans pursuant to § 6–6–280, Ala. Code 1975. That statute provides, in pertinent part, as follows:

"An action for the recovery of land or the possession thereof in the nature of an action in ejectment may be maintained without a statement of any lease or demise to the plaintiff or ouster by a casual or nominal ejector, and the complaint is sufficient if it alleges that the plaintiff was possessed of the premises or has the legal title thereto, properly designating or describing them, and that the defendant entered thereupon and unlawfully withholds and detains the same."

§ 6–6–280(b). Therefore, to prevail on its motion for a summary judgment, Regions was required to present substantial evidence establishing that it had legal title to the property and that the Pittmans unlawfully remained on the property. Id. See also Turner v. Wells Fargo Bank, N.A., [Ms. 2150320, Sept. 30, 2016] ––– So.3d ––––, –––– (Ala. Civ. App. 2016).

The Pittmans assert numerous grounds that they say demonstrate that Regions did not have legal title to the property; thus, they say, the summary judgment entered for Regions in its ejectment action was improper. Among other reasons as to why they believe the foreclosure was improper, the Pittmans contend that Regions failed to provide them with proper notice of intent to accelerate the note and with proper notice of intent to foreclose, as required by Section 22 of the mortgage. The Pittmans also contend that Regions was not a real party in interest because, they say, there was no evidence that Regions was a "holder" of the note. Additionally, they challenge Regions' refusal to sell the property in separate parcels rather than en masse.

Regions contends that it is not required to provide a "full point-by-point rebuttal" of the Pittmans' contentions challenging the foreclosure of the property because, it says, the Pittmans waived their right to challenge the foreclosure by not doing so in a timely manner. We agree with Regions that some of the many grounds the Pittmans assert for arguing that the foreclosure was improper cannot be used as defenses in this ejectment action, although not necessarily for the reasons Regions suggests. However, Regions' argument is not applicable to all the grounds the Pittmans raised in defense of this action.

"Not all irregularities in the foreclosure process, but only those irregularities that would render the foreclosure sale void, may be raised as affirmative defenses to an ejectment action." Campbell v. Bank of America, N.A., 141 So.3d 492, 499 (Ala. Civ. App. 2012). In Campbell, this court explained:

"An ejectment action following a nonjudicial foreclosure ... is not a ‘foreclosure action,’ and a defense in such an action asserting errors in the foreclosure process is a collateral attack on a

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