Supreme Court of Texas

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No. 23-0525

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Linda Moore and Thomas Moore, Jr.

Appellants,

v.

Wells Fargo Bank, N.A., as trustee for MASTR Asset Backed 

Securities Trust 2004-OPT2, Mortgage Pass-Through 

Certificates, and PHH Mortgage Corporation, 

Appellees

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On Certified Questions from the 

United States Court of Appeals for the Fifth Circuit

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Argued October 25, 2023

JUSTICE BLAND delivered the opinion of the Court.

When a lender accelerates a loan that has fallen into default, the 

statute of limitations on foreclosure begins to run. Under Civil Practice 

and Remedies Code Section 16.038, however, the lender can rescind its 

acceleration—and reset the limitations period—by notifying the 

borrower of the rescission in a manner that complies with the statute. 

In this case, the lenders issued notices that rescinded acceleration and

also notified the borrowers that the loan was then reaccelerated. The 
2

borrowers sued for declaratory relief, claiming that limitations had run 

against foreclosure of the lien on their property because the rescission 

notices simultaneously notified the borrowers that the loan was again 

accelerated.

Rejecting that claim, a federal district court ruled that limitations 

on foreclosure had not run. Accordingly, it granted summary judgment 

in favor of the lenders. The borrowers appealed, and the Fifth Circuit 

certified questions to us inquiring whether simultaneous rescission and 

reacceleration can reset the limitations period under Section 16.038. We 

respond that a rescission that complies with the statute resets 

limitations even if it is combined with a notice of reacceleration. 

I

In 2004, Linda and Thomas Moore obtained a $170,700 loan 

secured by their property in Sugar Land. Wells Fargo Bank holds the 

note and deed of trust memorializing the bank’s security interest. PHH 

Mortgage Corporation services the loan.1

The deed of trust contains an acceleration clause in the event of 

default: “all sums secured by this Security Instrument and accrued 

interest thereon shall at once become due and payable at the option of 

Lender without prior notice, except as otherwise required by applicable 

law, and regardless of any prior forbearance.” The deed of trust also 

waives any notice of intent to accelerate. Upon acceleration, however, 

the Moores are entitled to reinstate the loan “as if no acceleration had 

occurred” by paying all sums due plus costs. 

1 Ocwen Loan Servicing, LLC previously serviced the loan. 
3

After the Moores defaulted on the loan, the mortgage servicer 

issued a notice of intent to accelerate in October 2015, and it gave 

written notice that it had accelerated the loan on February 2, 2016. A

foreclosure sale scheduled for March 1 did not occur. 

Eight months later, on October 6, the mortgage servicer sent the 

Moores a “Notice of Acceleration of Maturity” that rescinded its earlier 

acceleration of the note: 

The Servicer hereby rescinds all prior acceleration notices. 

The rescission of prior acceleration notices does not act as 

a waiver or [sic] any rights nor does the rescission(s) 

suspend the current rights or claims of Mortgagee, its 

successor or assigns. Mortgagee reserves the right to 

accelerate in this notice or in a separate notice and may 

continue to collect the debt owed by Borrower. 

In the next paragraph, the notice reaccelerates the debt. The notice set 

a new foreclosure and sale date in November.

Additional notices sent to the Moores repeat the rescission 

language and then reaccelerate the loan in November 2016, January 

2017, March 2017, and March 2019. Each notice updates both the 

amount the Moores owed in total and the amount the Moores could pay 

to cure their default and reinstate the loan. The final notice contained 

additional language: “Any acceleration of the Note made prior to sending 

this Notice is hereby rescinded in accordance with the Texas Practice 

and Remedies Code § 16.038.” 

During and after this time, the mortgage servicer scheduled 

multiple foreclosure sales that never occurred, and the Moores filed 

multiple bankruptcy petitions, which the bankruptcy court dismissed. 
4

To date, Wells Fargo has not foreclosed on the property, and the Moores 

have not made a payment on the loan in eight years. 

In August 2020, the Moores sued in state court, seeking a 

declaratory judgment that the limitations period had run four years

after the first acceleration in February 2016. Wells Fargo and PHH 

removed the case to federal court and moved for summary judgment. 

They contended that they had rescinded earlier accelerations under 

Section 16.038 and further had abandoned acceleration by demanding

less than the full balance of the loan. The district court granted 

summary judgment. 

The Moores appealed to the United States Court of Appeals for 

the Fifth Circuit. The Fifth Circuit certified to us the following 

questions: 

(1) May a lender simultaneously rescind a prior 

acceleration and re-accelerate a loan under Tex. Civ. Prac. 

& Rem. Code § 16.038? 

(2) If a lender cannot simultaneously rescind a prior 

acceleration and re-accelerate a loan, does such an attempt 

void only the re-acceleration, or both the re-acceleration 

and the rescission?

We answer the first question “yes.” Accordingly, we do not reach the 

second.

II

In Texas, a lender must bring suit to foreclose on a real property 

lien “not later than four years after the day the cause of action accrues.”2

2 Tex. Civ. Prac. & Rem. Code § 16.035(a). 
5

Generally, the accrual date is the maturity date of the loan.3 Pertinent 

here, however, notes often also contain acceleration clauses that permit 

the lender to accelerate the loan upon the borrower’s default. When a

lender chooses to accelerate, the cause of action for foreclosure of the lien 

accrues at the time of acceleration.4

Not all accelerations are carried through to foreclosure. A lender 

may abandon or rescind acceleration of the note, restore the original 

maturity date, and reset the limitations period, thus giving the borrower 

an opportunity to cure the default. 

Civil Practice and Remedies Code Section 16.038 provides one 

nonexclusive method of rescission.5 Under Section 16.038(b), rescission 

of acceleration “is effective if made by a written notice of a rescission or 

waiver served . . . on each debtor who . . . is obligated to pay the debt.”6

The notice must be served “by first class or certified mail and is complete 

when the notice is deposited in the United States mail, postage prepaid 

and addressed to the debtor at the debtor’s last known address.”7

Rescission under this section “does not affect a lienholder’s right to 

accelerate the maturity date of the debt in the future nor does it waive 

past defaults.”8

3 Id. § 16.035(e). 

4 Holy Cross Church of God in Christ v. Wolf, 44 S.W.3d 562, 566 (Tex. 

2001).

5 Tex. Civ. Prac. & Rem. Code § 16.038(a), (e). 

6 Id. § 16.038(b).

7 Id. § 16.038(c).

8 Id. § 16.038(d). 
6

The Moores received multiple letters notifying them that the 

lenders had rescinded earlier accelerations of the loan, as Section 

16.038(b) permits. They argue, however, that the limitations period did 

not reset because these letters further informed them that their loan 

was reaccelerated. First, the Moores rely on Swoboda v. Ocwen Loan 

Servicing, a court of appeals case that explains common-law 

abandonment of acceleration.9 In Swoboda, the court held that 

reacceleration will not reset limitations unless the earlier acceleration 

was abandoned.10 Second, the Moores contend that Section 16.038 refers 

to a lienholder’s right to accelerate “in the future.”11 Relying on this 

language, they argue that a notice rescinding an earlier acceleration is

ineffective if it is accompanied by a notice that the loan is reaccelerated. 

Wells Fargo and PHH respond that the notices comply with 

Section 16.038 and thus are effective rescissions. The statute does not 

make rescission contingent on refraining from reaccelerating the loan in 

the same notice. Rather, the statute expressly contemplates that a 

lender may reaccelerate after rescission.

We agree with Wells Fargo and the federal district court. The 

Moores received five compliant rescission notices within four years after 

the initial February 2016 acceleration. Section 16.038 requires that a 

notice of rescission be written and served via an appropriate method to 

the debtor’s last known address. It does not require that the rescission

9 579 S.W.3d 628, 632–33 (Tex. App.—Houston [14th Dist.] 2019, no 

pet.).

10 Id. at 636–37.

11 See Tex. Civ. Prac. & Rem. Code § 16.038(d).
7

notice be distinct or separate from other notices that a lender might send

to borrowers with a loan in default. In the absence of any restriction, we 

will not read one into the statute.12

The Moores’ analogy to common-law abandonment cases is also 

unavailing. In Swoboda, the court of appeals held that an abandonment 

of acceleration must be clear enough to “justify the borrower in believing 

and acting upon the belief that the effect of the failure to pay an 

installment was to be disregarded, and that the contract should stand 

as if there had been no default.”13 A rescission under Section 16.038, in

contrast, “is complete” upon the lender’s depositing the notice in the 

mail, addressed to the “the debtor’s last known address.”14 

The statute’s express provision that a rescission “does not affect 

a lienholder’s right to accelerate the maturity date of the debt in the 

future” does not create a waiting period between rescission and 

reacceleration of specific duration.15 It is the very nature of rescission to 

remove the earlier acceleration, paving the way for a new one to follow, 

whether in the same letter or by separate notice.16

12 See City of Rockwall v. Hughes, 246 S.W.3d 621, 631 (Tex. 2008) 

(“[C]hanging the meaning of the statute by adding words to it, we believe, is a 

legislative function, not a judicial function.”).

13 579 S.W.3d at 636 (quoting San Antonio Real Est. Bldg. & Loan Ass’n 

v. Stewart, 61 S.W. 386, 389 (Tex. 1901)). 

14 Tex. Civ. Prac. & Rem. Code § 16.038(c). 

15 Id. § 16.038(d). 

16 See PHH Mortg. Corp. v. Aston, No. 01-21-00057-CV, 2022 WL 

3363196, at *4, *6 (Tex. App.—Houston [1st Dist.] Aug. 16, 2022, pet. denied) 

(interpreting similar notices as effective to rescind acceleration and reset the 

limitations period).
8

The Moores advance policy arguments against simultaneous 

rescission and reacceleration, but none justifies departing from the text 

of the statute. Though Section 16.038 permits lenders to reset the 

limitations period, borrowers are in the same position under the original 

terms of the lien. Absent acceleration, limitations on foreclosure does 

not begin to run until the lien matures—often decades in the future. 

Meanwhile, the borrowers remain in their home despite their default 

and have a further opportunity to cure that default upon notice of the 

reacceleration. 

Finally, our answer is not in tension with Wilmington Trust v. 

Rob, 891 F.3d 174, 177 (5th Cir. 2018), which suggests that a new 

acceleration of a loan requires a new notice of a lender’s intent to 

accelerate the loan—in addition to the notice of acceleration itself—to 

be effective.17 In this case, the district court premised summary 

judgment on the effectiveness of the rescission to reset limitations.

Whether the current loan has been properly reaccelerated is not at issue 

in deciding whether limitations has run. 

17 Such a determination may be fact specific, as in the case of a lien with 

an express waiver of notice. See Shumway v. Horizon Credit Corp., 801 S.W.2d 

890, 893–94 (Tex. 1991) (permitting the right to notice to be surrendered by a 

specific, separate waiver). 
9

* * *

A lender’s simultaneous reacceleration does not nullify a 

rescission that complies with Civil Practice and Remedies Code 

Section 16.038. We answer the Fifth Circuit’s first question “yes” and 

therefore need not answer the second question. 

Jane N. Bland

Justice

OPINION DELIVERED: February 23, 2024