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Bac Home Loans Servicing v. Charles L. Drew

February 13, 2013

BAC HOME LOANS SERVICING, LP, F/K/A COUNTRYWIDE HOME LOANS SERVICING, LP, PLAINTIFF-APPELLEE,
v.
CHARLES L. DREW, JR., DEFENDANT-APPELLANT.



Appeal from the Iowa District Court for Wapello County, Daniel P. Wilson, Judge.

The opinion of the court was delivered by: Danilson, J.

Charles Drew appeals from the entry of summary judgment in favor of Bank of America (the successor to BAC Home Loans LP by merger). REVERSED AND REMANDED.

Considered by Potterfield, P.J., and Danilson and Tabor, JJ.

Charles Drew appeals from the entry of summary judgment in favor of Bank of America (the creditor)*fn1 in this mortgage foreclosure proceeding. Because a genuine issue of material fact exists as to whether proper notice was, in fact, provided to the debtor, the creditor has failed to establish it is entitled to summary judgment. We therefore reverse and remand for further proceedings.

We review the entry of summary judgment for the correction of errors at law. Merriam v. Farm Bureau Ins., 793 N.W.2d 520, 522 (Iowa 2011). Summary judgment should only be granted when the moving party is able to affirmatively establish that there is no genuine issue of material fact and that they are entitled to judgment as a matter of law. Iowa R. Civ. P. 1.981(3); Merriam, 793 N.W.2d at 522. Under our review, we view the facts in the light most favorable to the nonmoving party. Merriam, 793 N.W.2d at 522.

The following facts are not in dispute. On June 15, 2007, Charles Drew signed a note in the principal sum of $67,000 and payable to Community 1st Credit Union for property with the address of "407 South 2nd Street, Eddyville, Iowa, 52553." To secure that note, Drew signed a mortgage giving the credit union a security interest in his homestead.*fn2 Section 7 of the promissory note provides with respect to notices to be given:

Unless applicable law requires a different method, any notice that must be given to me under this Note will be given by delivering it or by mailing it by first class mail to me at the Property Address above or at a different address if I give the Note Holder a notice of my different address.

Any notice that must be given to the Note Holder under this Note will be given by delivering it or by mailing it by first class mail to the Note Holder at the address stated in Section 3(A) above or at a different address if I am given a notice of that different address. (Emphasis added.)

Section 15 of the mortgage similarly provides:

All notices given by Borrower or Lender in connection with this Security Instrument must be in writing. Any notice to Borrower in connection with this Security Instrument shall be deemed to have been given to Borrower when mailed by first class mail or when actually delivered to Borrower's notice address if sent by other means. Notice to any one Borrower shall constitute notice to all Borrowers unless Applicable Law expressly requires otherwise. The notice address shall be the Property Address unless Borrower has designated a substitute notice address by notice to Lender. Borrower shall promptly notify Lender of Borrower's change of address. If Lender specifies a procedure for reporting Borrower's change of address, then Borrower shall only report a change of address through that specified procedure. There may be only one designated notice address under this Security Instrument at any one time. Any notice to Lender shall be given by delivering it or by mailing it by first class mail to Lender's address stated herein unless Lender has designated another address by notice to Borrower. Any notice in connection with this Security Instrument shall not be deemed to have been given to Lender until actually received by Lender. If any notice, required by this Security Instrument is also required under Applicable Law, the Applicable Law requirement will satisfy the corresponding requirement under this Security Instrument. (Emphasis added.)

Drew fell behind in his mortgage payments and, on May 17, 2010, the creditor sent a notice of right to cure default to "Charles L. Drew, Jr., P.O. Box 533, Ottumwa, Iowa, 52501-0533."

On July 9, 2010, the creditor's counsel sent a letter to Drew stating the creditor was accelerating of the note, which letter included a notice of the right to mortgage mediation. The documents were mailed to "Charles L. Drew, Jr., P.O. Box 533, Ottumwa, Iowa, 52501."

On July 26, 2010, the creditor filed a petition for mortgage foreclosure, alleging in paragraph 13 through 15 that notices of right to cure default, acceleration of the note, and mediation were mailed to Drew. Drew filed an answer, denying paragraphs 13 through 15 and stating that the address to which the notices were sent "is not, nor has it ever been, his address and therefore [he] did not receive" the documents as alleged. The answer also asserted an affirmative defense of failure to comply with condition precedent to acceleration and foreclosure because the creditor "failed to properly notify the defendant."

The creditor filed a motion for summary judgment asserting "all parties to this action have been accorded their rights and notices in accordance with the laws of the State of Iowa." Drew resisted the motion. In ...


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