Williams v. HSBC Bank USA, N.A.

Decision Date14 April 2015
Docket NumberNo. SD 33364,SD 33364
PartiesDave R. Williams and Candice J. Williams, Plaintiffs–Appellants, v. HSBC Bank USA, N.A., Defendant–Respondent.
CourtMissouri Court of Appeals





Dave R. Williams (Mr. Williams) and his wife Candice J. Williams (Mrs. Williams) (collectively Appellants) appeal from the trial court's grant of summary judgment in favor of HSBC Bank USA, N.A. (HSBC). Appellants raise eleven points on appeal. We disagree with their arguments and affirm the trial court's judgment.

Factual and Procedural Background

In 2007, Appellants obtained a loan to purchase a home and signed a deed of trust on the property securing repayment of the loan. Shortly thereafter, Appellants learned the servicing of the loan had been transferred to HSBC.

Beginning in 2008, Appellants failed to make payments on the loan. On July 8, 2009, HSBC sent a letter to Mr. Williams informing him the loan was in default in the amount of $25,171.28. HSBC appointed Milsap & Singer, P.C. (“the successor trustee) as successor trustee under the deed of trust.

During the fall of 2009, Appellants discussed a loan modification with HSBC. However, on October 16, 2009, Appellants received a letter from HSBC informing them their request for assistance was denied. Around the same time, the successor trustee sent Appellants a notice of trustee's sale.

On November 3, 2009, the successor trustee conducted a foreclosure sale. Appellants were not current on their mortgage payments and did not attend the foreclosure sale.1 On November 4, 2009, the successor trustee recorded a Successor Trustee's Deed Under Foreclosure that listed CIBM HSBC Bank USA (CIBM) as the grantee.

On November 17, 2009, HSBC's attorneys sent Appellants a notice to vacate by certified mail.2 Appellants did not vacate the property. Instead, Appellants continued to discuss the situation with HSBC's representatives. At no time did Appellants ever tender full payment of the amount due under the note.3

On December 4, 2009, CIBM sued Appellants for unlawful detainer. During the course of that lawsuit, the parties discovered CIBM was not a legal entity. Thus, that suit for unlawful detainer was dismissed. HSBC filed a corrected Successor Trustee's Deed Under Foreclosure which listed HSBC as the grantee instead of CIBM.4 Meanwhile, Appellants sued HSBC alleging several counts. On March 7, 2011, HSBC sued Appellants in unlawful detainer.

Ultimately, the cases were consolidated, and both parties sought summary judgment regarding the claims raised in Appellants' petition. On March 4, 2014, the trial court entered summary judgment for HSBC and against Appellants on all the counts in Appellants' petition. At the same time, the trial court set HSBC's unlawful detainer claim for trial. On April 10, 2014, HSBC sought summary judgment on its unlawful detainer claim. The trial court granted HSBC's motion, and Appellants appeal.

Standard of Review

“Appellate review of summary judgment is de novo. Roberts v. BJC Health System, 391 S.W.3d 433, 437 (Mo. banc 2013). That is, [t]he criteria on appeal for testing the propriety of summary judgment are no different from those which should be employed by the trial court to determine the propriety of sustaining the motion initially.” ITT Commercial Fin. Corp. v. Mid–America Marine Supply Corp., 854 S.W.2d 371, 376 (Mo. banc 1993). “Summary judgment is appropriate when the moving party has demonstrated, on the basis of facts as to which there is no genuine dispute, a right to judgment as a matter of law.” Roberts, 391 S.W.3d at 437. Furthermore, a grant of summary judgment “can be affirmed on appeal by any appropriate theory supported by the record.” Id.


Appellants raise numerous points challenging the trial court's grant of summary judgment in favor of HSBC.5 For ease of analysis, we address their points out of order.

Point III, Point VI, and Point VII: Quiet Title

In three points, Appellants challenge the trial court's grant of summary judgment to HSBC on Appellants' claim for quiet title. These points are based on the theory that the Successor Trustee's Deeds Under Foreclosure were void because the first Successor Trustee's Deed listed CIBM, a nonexistent entity, as the grantee and a void deed cannot be corrected. All three of these points fail because the undisputed material facts show that by the time those deeds were executed, Appellants had already lost title to the property.

As a defending party on the quiet title claim, HSBC could show a right to judgment as a matter of law by presenting undisputed “facts that negate any one of the claimant's elements facts[.] ITT, 854 S.W.2d at 381. “A suit to quiet title is a special statutory action to adjudge the respective estates, titles and interests of several claimants to land [.] Sharp v. Crawford, 313 S.W.3d 193, 199 (Mo.App.S.D.2010). In such an action, “the burden of proof is upon each party to prove better title than that of his adversary.” Id. (quoting McCord v. Gates, 159 S.W.3d 369, 374 (Mo.App.W.D.2004) ). “A claimant must prevail on the strength of his own title and not upon any weakness in the title of the other party.”

Robertson v. North Inter–River Drainage Dist., 842 S.W.2d 544, 546 (Mo.App.S.D.1992).

In the present case, the undisputed material facts show HSBC had superior title due to the foreclosure sale. “A valid trustee's foreclosure sale transfers all legal and equitable interests in the property to the purchaser at the sale, subject only to a statutory right of redemption if reserved by the debtor as provided by the statute.” In re Tucker, 290 B.R. 134, 136 (Bankr.E.D.Mo.2003) (applying Missouri law). Additionally, [a] foreclosure sale is complete at the end of the auction.” Id. at 136–37.

Here, the undisputed material facts show that (1) Appellants were in default at the time of the foreclosure sale, (2) the necessary notices for the foreclosure sale were sent to the primary residence of Appellants, and (3) Appellants did not attend the foreclosure sale. Thus, at the end of the auction, Appellants lost title to the property, and they cannot prove superior title to HSBC by arguing about any errors, alleged or otherwise, in the preparation of the Successor Trustee's Deeds.

In support of their argument to the contrary, Appellants rely primarily on Allmon v. Gatschet, 437 S.W.2d 70 (Mo.1969), for the proposition that a deed to a nonexistent corporation is void. That case is inapposite because title to the real estate in that case depended on the validity of the deed, see id. at 74, while here title to the real estate depends upon the validity of the foreclosure sale. See Wells Fargo Bank, N.A. v. Smith, 392 S.W.3d 446, 462 (Mo. banc 2013).

Point III, Point VI, and Point VII are denied.

Point II, Point IV, and Point V: Unlawful Detainer

In Point II, Point IV, and Point V, Appellants challenge the trial court's grant of summary judgment to HSBC on HSBC's claim for unlawful detainer and its associated denial of Appellants' motion for summary judgment on that claim.6 The arguments are essentially the same as those made in the quiet title points. We disagree with the arguments raised in these points.

HSBC was the claimant in the unlawful detainer action. Thus, to obtain summary judgment, it had to show “that there is no genuine dispute as to those material facts upon which [HSBC] would have had the burden of persuasion at trial.” ITT, 854 S.W.2d at 381. “An action for unlawful detainer is a limited statutory action where the sole issue to be decided is the immediate right of possession to a parcel of real property.” Federal Nat. Mortg. Ass'n. v. Wilson, 409 S.W.3d 490, 495 (Mo.App.E.D.2013) ; § 534.030.1, RSMo Cum. Supp. (2014). Where such a claim is based on foreclosure, the elements the claimant must prove are: (1) that the property was purchased at a foreclosure sale, (2) the defendant received notice of the foreclosure, and (3) the defendant refused to surrender possession of the property.” Wilson, 409 S.W.3d at 495. Additionally, “in such cases, the foreclosure purchaser's right to possession is based upon the fact of the sale as demonstrated by the deed, not on the ultimate validity of the title that the deed reflects.” Smith, 392 S.W.3d at 462.

In the present case, there is no dispute regarding each of the essential elements of HSBC's claim for unlawful detainer. In their response to HSBC's statement of undisputed material facts, Appellants admitted that the foreclosure sale occurred and that they did not vacate the property. Although they purported to challenge HSBC's statement that they received notice of the sale via certified mail, that statement was deemed admitted because Appellants did not cite to the discovery or affidavits in support of their denial. See Rule 74.04(c)(2) (“A response that does not comply with this Rule 74.04(c)(2) ... is an admission of the truth of that numbered paragraph.”).

Point II, Point IV, and Point V are denied.

Point XI: Jury Trial Right

In Point XI, Appellants argue the grant of summary judgment on HSBC's unlawful detainer claim was error because it denied Appellants their right to trial by jury as guaranteed by Article I, Section 22(a) of the Missouri Constitution. We disagree.

Article I, Section 22(a) of the Missouri Constitution provides [t]hat the right of trial by jury as heretofore enjoyed shall remain inviolate [.] Determining whether a statutory provision violates this constitutional mandate requires a two-part analysis. Watts v. Lester E. Cox Medical Centers , 376 S.W.3d 633, 637–38 (Mo. banc 2012). First, the court must determine whether the claim falls within the scope of the jury right as it existed when Missouri became a state. Id. at 638. Next, the court must determine whether the right remains free from change. Id.

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