Rogers v. RREF II CB Acquisitions, LLC

• Decision Date: 17 November 2016
• Docket Number: NUMBER 13–15–00321–CV
• Citation: 533 S.W.3d 419
• Parties: Michael J. ROGERS, Appellant, v. RREF II CB ACQUISITIONS, LLC, Appellee.
• Court: Texas Court of Appeals

533 S.W.3d 419

Michael J. ROGERS, Appellant,

v.RREF II CB ACQUISITIONS, LLC, Appellee.

NUMBER 13–15–00321–CV

Court of Appeals of Texas, Corpus Christi-Edinburg.

Delivered and filed November 17, 2016

Tom Wilkins, Wilkins & Wilkins, McAllen, for Appellant.

Darrell Wayne Cook, Darrell W. Cook & Associates, Dallas, for Appellee.

Before Chief Justice Valdez and Justices Rodriguez and Benavides

Opinion by Justice Rodriguez

Appellant Michael J. Rogers appeals from a partial summary judgment granted in favor of appellee RREF II CB Acquisitions, LLC (RREF). RREF sued Rogers, alleging that he had defaulted on a promissory note with an outstanding balance of $1,502,731.84. RREF moved for summary judgment on its breach of promissory note claim and submitted various records and affidavits to support its motion. By what we construe as eight issues on appeal, Rogers argues that the trial court erred in granting summary judgment because there were many technical defects in RREF's summary judgment evidence. We affirm.

I. BACKGROUND

RREF's petition in the trial court alleged that in 2006, Rogers borrowed $3,000,000 from Texas State Bank and executed a ten-year promissory note (the Note) in favor of Texas State Bank. The petition stated that the Note had become RREF's property through a series of transactions: in 2008, Texas State Bank merged with Compass Bank; and in 2013, Compass Bank sold and assigned the Note to RREF. According to RREF, Rogers had not made any payments on the Note since May 24, 2012, leaving an unpaid principal balance of $1,502,731.84. On September 6, 2013, RREF filed this suit against Rogers, alleging breach of promissory note and other claims not before this Court.

On June 14, 2014, RREF moved for partial summary judgment on its breach of promissory note claim and incorporated four affidavits and ten exhibits into the motion by reference. At first, each of these affidavits incorrectly referred to the plaintiff as "RREF CB II Acquisitions, LLC" rather than its correct legal name "RREF II CB Acquisitions, LLC." Rogers objected to this discrepancy. At the hearing, RREF offered to submit corrected affidavits within the next three days. The trial court gave RREF leave to file corrected affidavits after the hearing, which RREF did on October 23, 2014. The trial court gave Rogers seven days to file any supplemental objections or response to the corrected affidavits. On October 30, 2014, Rogers filed objections to the corrected affidavits and to RREF's proposed summary judgment order. On January 28, 2015, the trial court granted summary judgment in favor of RREF's breach of promissory note claim, granting relief of approximately $1,500,000 for the principal balance on the loan, over $400,000 for accrued interest before and after default, approximately $16,000 for a late charge provided under the note, post-judgment interest at a rate of 17.5%, and costs. The trial court severed that claim, and this appeal followed.

Because Rogers challenges several technical aspects of RREF's affidavits and exhibits, we discuss each affidavit and exhibit in brief. First, RREF incorporated a testimonial affidavit from Jenna Maytas, who attested that she was the Vice President of Loan Servicing for Quantum Servicing Corporation, which serviced Rogers's loan. The primary subject of Maytas's affidavit was a summary of the balance owed on the Note, including interest and principal balances and loan history. Maytas identified herself as a custodian of records for Quantum and represented that she had personal knowledge of the procedure Quantum followed in collecting, verifying, and processing account information for loans. To support her testimony, Maytas principally relied upon and cited to Exhibit 4, a summary of relevant account information that we discuss below.

RREF also incorporated a testimonial affidavit from Jennifer Wimmer. Wimmer identified herself as the Vice President of Loan Workout for the parent company of RREF, a firm called Rialto Capital Partners. Among other things, Wimmer's affidavit declared that Rogers executed a valid note in favor of Texas State Bank; that Texas State Bank merged with Compass Bank; and that Compass Bank, as success-in-interest to Texas State Bank, assigned the note to RREF. She further testified that under the Note, Rogers promised to repay $3,000,000 at variable interest not to exceed 8.25% in 120 monthly installments, but that in the event of default, interest would "accrue at the highest rate allowable under law." According to Wimmer's affidavit, Rogers defaulted on the Note—he did not make any payments on the Note after May 24, 2012, despite an outstanding demand for payment—and a principal balance of $1,502,731.84, exclusive of interest, remained due and payable by Rogers to RREF.

RREF also incorporated two business records affidavits from Wimmer, which together were filed to authenticate and sponsor the following ten exhibits:

Exhibit 1 was purported to be the $3,000,000 promissory Note which Rogers executed in favor of Texas State Bank. The exhibit appeared to bear Rogers's signature and initials on several pages.

Exhibit 2 was identified as "a true and correct copy of the Federal Deposit Insurance Corporation Information page showing the merger between Texas State Bank and Compass Bank." The exhibit describes Texas State Bank as an "inactive institution" due to the fact that it had merged into Compass Bank on March 13, 2008.

Exhibit 3 was a document titled "Assignment of Loan Documents." The document listed the "Borrower" as "Michael J. Rogers," the "Assignor" as "Compass Bank as successor-in-interest to Texas State Bank," and the "Assignee" as "RREF II CB Acquisitions, LLC." The document set out that Compass Bank had entered a separate "Loan Sale Agreement" with RREF (a document which was also incorporated by RREF as Exhibit 8, infra). Exhibit 3 stated that based on this loan sale, Compass Bank was thereby assigning several instruments—the Note, a related mortgage, and associated loan documents—to RREF. The assignment bore the notarized signature of William H. Douning, Senior Vice President of "Compass Bank as successor-in-interest to Texas State Bank."

Exhibit 4 was identified by Maytas as a "true and correct copy of interest calculation." The document summarized vital account information regarding the Note and its surrounding context, including an initial balance of $3,000,000, a principal balance of $1,502,731.82, the applicable interest rates before and after default, and interest accrued. The document provided two account numbers for the loan: an "Old Loan Account" number and a "Quantum Loan Account" number. The document also listed dates of assignment, maturity, and default which corresponded with RREF's allegations in this suit and with the details provided in other exhibits.

Exhibits 5 through 7 were identified as communications drafted or received by Wimmer and Rogers. Exhibit 5, for instance, was purported to be a letter from Wimmer to Rogers regarding the "loan Rialto Capital recently purchased from Compass Bank." Attached to the letter was a proposed agreement between Rogers and Rialto, as well as the Assignment of Loan Documents (Exhibit 3). Exhibit 6 was allegedly an email drafted on Rogers's behalf by Kenneth Everhard, who identified himself as Rogers's CPA. Exhibit 7 was purported to be a letter from RREF to Rogers, whereby RREF was attempting to collect Rogers's debt under the Note.

Exhibit 8 was purported to be the "Loan Sale Agreement" between Compass and RREF, which itself had been referred to in the Assignment of Loan Documents (Exhibit 3) as the basis for the assignment of the Note and related documents to RREF.

Exhibit 9 was described as part of original loan application which Rogers had signed and submitted to Texas State Bank.

Exhibit 10 was purported to be a "Disclaimer of Oral Agreements" signed by Rogers as part of his original loan application.

On appeal, Rogers raises several arguments against RREF's summary judgment proof. We take up his issues in turn.

II. STANDARD OF REVIEW

We review the trial court's granting of a traditional motion for summary judgment de novo. See Tex. Mun. Power Agency v. Pub. Util. Comm'n of Tex., 253 S.W.3d 184, 192 (Tex. 2007). When reviewing a traditional summary judgment, we must determine whether the movant met its burden to establish that no genuine issue of material fact exists and that the movant is entitled to judgment as a matter of law. TEX. R. CIV. P. 166a(c) ; Sw. Elec. Power Co. v. Grant, 73 S.W.3d 211, 215 (Tex. 2002). We take as true all evidence favorable to the non-movant, and we indulge every reasonable inference and resolve any doubts in the non-movant's favor. Sw. Elec. Power, 73 S.W.3d at 215. After the movant produces evidence sufficient to show it is entitled to summary judgment, the non-movant must then present evidence raising a fact issue. Chacon v. Andrews Distrib. Co. Ltd., 295 S.W.3d 715, 721 (Tex. App.–Corpus Christi 2009, pet. denied).

We review a trial court's ruling on the admissibility of evidence for an abuse of discretion. See Serv. Corp. Intern. v. Guerra, 348 S.W.3d 221, 235 (Tex. 2011) ; Krishnan v. Law Offices of Preston Henrichson, PC, 83 S.W.3d 295, 299 (Tex. App.–Corpus Christi 2002, pet. denied) (applying an abuse of discretion standard to rulings on summary judgment evidence). A trial court abuses its discretion when it rules without regard for any guiding rules or principles. See Owens–Corning Fiberglas Corp. v. Malone, 972 S.W.2d 35, 43 (Tex. 1998).

III. CORRECTION OF PARTY'S NAME

By his first issue, Rogers complains that RREF at first submitted summary judgment evidence which incorrectly identified the plaintiff as "RREF CB II Acquisitions, LLC," rather than its correct name "RREF II CB Acquisitions, LLC." Rogers insists that before the mistake could be corrected, RREF was required to produce evidence justifying a correction, such as proof that there was no entity called "RREF CB II Acquisitions, Inc....