Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-ca10-91-06281/USCOURTS-ca10-91-06281-0/pdf.json

Nature of Suit Code: 422
Nature of Suit: Bankruptcy Appeals Rule 28 USC 158
Cause of Action: 

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FIL-~ 

UNITED STATES COURT OF APPEALS United States Co~rt<?f Appeob Tenth C·- "'1

" , 

TENTH CIRCUIT 

In re: V. DALE LANDERS, and 

SANDRA JANE LANDERS, 

Debtors. 

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V. DALE LANDERS, and SANDRA JANE 

Plaintiffs-Appellants, 

v. 

UNITED STATES OF AMERICA, ex rel. 

FARMERS HOME ADMINISTRATION, 

Defendant-Appellee. 

LANDERS,) 

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ORDER AND JUDGMENT* 

FEB 2 7 1992 

ROBERT L. HOECKER 

Clerk 

No. 91-6281 

(D.C. No. CIV-90-1454-P) 

( W. D. Okla. ) 

Before MOORE, TACHA, and BRORBY, Circuit Judges. 

After examining the briefs and appellate record, this panel 

has determined unanimously that oral argument would not materially 

assist the determination of this appeal . See Fed. R. App. P. 

34(a); 10th Cir. R. 34.1.9. The case is therefore ordered submitted without oral argument. 

Appellants appeal an order of the district court affirming 

the bankruptcy court's ruling that the Farmers Home Administration 

("FHA") is entitled to $32,221 that it was paid pursuant to a 

* This order and judgment has no precedential value and shall 

not be cited, or used by any court within the Tenth Circuit, 

except for purposes of establi shing the doctrines of the law of 

the case, res judicata, or collateral estoppel. 10th Ci r. R. 

36.3. 

Appellate Case: 91-6281 Document: 010110226164 Date Filed: 02/27/1992 Page: 1 
standard mortgage loss payable clause in an insurance policy on 

mortgaged property. We exercise jurisdiction under 28 u.s.c. § 

158(d) and affirm. 

Appellants ask this court to determine whether an Oklahoma 

extinguishment statute, 12 Olka. Stat. § 686, requires FHA, as the 

mortgage holder, to seek a deficiency judgment within ninety days 

of the date of the sheriff's sale of appellants' property. 

Appellants argue that FHA's mortgage was extinguished by its 

failure to comply with S 686, and, therefore, FHA lost its 

interest in the property and its rights to recover the $32,221 

insurance proceeds under the insurance policy. 

The bankruptcy court found that the appellants' mortgage 

instrument waived the statutory protection afforded by§ 686. The 

court determined that FHA was, therefore, not required to seek a 

deficiency judgment within ninety days of the foreclosure sale, 

and that the foreclosure judgment and sale did not extinguish 

FHA's lien on the property. The court concluded that as the 

holder of a valid lien and as the loss payee under the insurance 

policy at the time of the loss, FHA is entitled to the $32,221 

paid by the insurance company. The district court affirmed the 

bankruptcy court's judgment for substantially the same reasons 

given by the bankruptcy court. 

On appeal, appellants do not dispute that the mortgage 

instrument waived the statutory protection of§ 686. Further, 

appellants do not argue that this waiver is unenforceable. 

Because appellants have offered no basis for setting aside prior 

findings that the mortgage instrument waived the statutory 

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Appellate Case: 91-6281 Document: 010110226164 Date Filed: 02/27/1992 Page: 2 
protection of§ 686, we have no reason to consider whether a 

mortgagee's failure to comply with§ 686 could result in the 

extinguishment of a lien and cause the mortgagee to lose its 

rights to insurance proceeds. 

The order of the district court is AFFIRMED. The mandate 

shall issue forthwith. 

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ENTERED FOR THE COURT 

Deanell Reece Tacha 

Circuit Judge 

Appellate Case: 91-6281 Document: 010110226164 Date Filed: 02/27/1992 Page: 3