AFFIRMED and Opinion Filed April 27, 2020 

S 

In The 

Court of Appeals 

Fifth District of Texas at Dallas 

No. 05-19-00854-CV 

SONIA M. CASTILLO, Appellant 

V. 

BRANCH BANKING & TRUST COMPANY, SUCCESSOR-IN-INTEREST 

TO COLONIAL BANK, Appellee 

On Appeal from the 68th Judicial District Court 

Dallas County, Texas 

Trial Court Cause No. DC-18-16153 

MEMORANDUM OPINION 

Before Justices Myers, Partida-Kipness, and Reichek 

Opinion by Justice Reichek 

This case involves a dispute over who has the rights to proceeds from the sale 

of property. Branch Banking & Trust Co. brought suit against Sonia M. Castillo 

seeking a declaration that its lien on the property was superior to Castillo’s. 

Following competing motions for summary judgment, the trial court granted the 

Bank’s motion and denied Castillo’s, declared the Bank’s lien superior, and ordered 

that the Bank held exclusive rights to the funds. Castillo challenges those rulings on 

appeal. For the reasons set out below, we affirm the trial court’s judgment. 
2 

Factual Background

 Castillo is the longtime secretary and “dear friend” of James C. Morris. In 

2006, Morris took out two notes with Colonial Bank. The notes were revolving lines 

of credit. Note 1 was $1.5 million and, after amendment, had a maturity date of July 

11, 2012. Note 2 was $500,000 and, after extensions, had a maturity date of 

September 15, 2009. The notes were secured by property at I-635 and George Bush 

Tollway pursuant to Deeds of Trust. 

 Colonial Bank failed, and the FDIC subsequently sold Colonial’s assets, 

including the Morris notes, to Branch Banking & Trust (“the Bank”). After the Bank 

obtained the Notes, Morris defaulted. Although the Bank sent notice of default, 

opportunity to cure, and intent to accelerate, the Bank took no other action until it 

sued Morris on May 2, 2011 for breach of the Notes. Morris counterclaimed in 

February 2013, challenging the validity and enforceability of the notes and deeds of 

trust. Morris sought declarations regarding (1) the validity and enforceability of the 

loan documents, (2) the rights of the parties as to the “nature of the lawful 

obligations, if any, imposed on [him]” by the loan documents, and (3) the rights of 

the parties as to the real property, “as no assignments to [the Bank] has been made 

of any security interest in the property and fraudulent, forged or altered documents 

appear in its chain of title.” In addition to declaratory relief, Morris brought causes 

of action for fraud, fraud in the inducement, negligence and negligent 
3 

misrepresentation, breach of contract, and breach of fiduciary duty and duty of good 

faith and fair dealing. The Bank did not seek to foreclose on the lien while the parties 

litigated the legitimacy of the legal instruments by which the lien was established. 

Litigation continued for more than four years, delayed in part by Morris twice 

filing for bankruptcy. Castillo was listed as a creditor of Morris in both bankruptcies. 

Ultimately, the trial court granted partial summary judgment in the Bank’s favor and 

left the remaining issues to be tried to a jury. Shortly before the jury trial, Castillo 

sued Morris in district court in Collin County, claiming she loaned him money and 

he did not repay her. Two days after she filed the suit, the trial court signed an 

Agreed Judgment awarding Castillo about $300,000. Nine days later, on February 

20, 2015, Castillo filed her abstract of judgment in Dallas County. 

 The Morris case was tried to a jury in April, and the jury found in the Bank’s 

favor. The trial court signed the final judgment in October 2015, and Morris 

appealed to this Court, which affirmed the judgment on August 24, 2017. See Morris 

v. Branch Banking & Trust Co., No. 05-15-01249-CV, 2017 WL 3634334, at *1 

(Tex. App.—Dallas Aug. 27, 2017, pet. denied) (mem. op.). Morris then appealed 

to the Texas Supreme Court, which denied review on January 12, 2018. Finally, he 

appealed to the United States Supreme Court, which denied Morris’s petition for 

writ of certiorari on October 1, 2018. 139 S. Ct. 122 (2018). 
4 

 While the appeal was pending, the following occurred. On September 27, 

2017, one month after this Court affirmed the judgment, the Bank filed a postjudgment application for appointment of a receiver to take possession of the property 

and sell it. The trial court appointed the receiver and instructed him to take 

possession, market, collect rents, and sell the property and to pay the proceeds to the 

Bank. Thereafter, on January 8, 2018, Castillo filed an “involuntary bankruptcy 

petition” against Morris to stop the sale of the property by the receiver. Shortly after 

the petition was filed, the bankruptcy court issued an order directing both Castillo 

and Morris to appear and show cause why the petition should not be dismissed. The 

bankruptcy court noted Morris’s previous bankruptcy filings involving the property 

and indicated its “concern” that Castillo, who was Morris’s “secretary for 34 years,” 

had filed the petition in violation of a “bar order” precluding Morris from any refiling 

for two years. Thereafter, Castillo filed a motion to dismiss the bankruptcy, which 

the court granted on April 27, 2018. 

 One month later, after the receiver moved for approval of sale of the property, 

Castillo intervened in the state court post-judgment receivership proceeding. She 

alleged she had a “proportionate interest” in Morris’s assets based on the 2015 

agreed judgment and her subsequent abstract of judgment. She also alleged that the 

Bank had “no superior lien or other rights superior” to hers with respect to Morris’s 

nonexempt assets. 
5 

The property was sold in November 2018 for $2.25 million. As part of an 

escrow agreement, $400,000 was held in escrow pending resolution of Castillo’s 

abstract of judgment. The trial court ordered $1.275 million of the remaining 

proceeds distributed to the Bank and discharged the receiver. 

 The Bank brought this declaratory judgment suit against Castillo to determine 

the rights to the funds held in escrow. In its petition, the Bank alleged it has a deed 

of trust lien on the property filed in 2006 that is superior to Castillo’s abstract of 

judgment filed in 2015 and sought a corresponding declaration. Castillo filed an 

answer asserting a general denial and affirmative defenses, including the statute of 

limitations. She alleged that the Bank did not timely assert its rights under the deed 

of trust and consequently its claims as to priority are barred by limitations. 

The parties filed cross motions for summary judgment on the limitations issue. 

In her motion for summary judgment, Castillo asserted that she and the Bank are 

both claiming priority to the sales proceeds, which are not sufficient to pay both 

judgments. She asserted that her 2015 abstract of judgment had priority over the 

Bank’s 2006 deed of trust lien because the Bank’s deed of trust lien became “void” 

when it failed to foreclose on the property within four years of the accrual of the 

cause of action. She asserted that the Bank filed suit on the notes in 2011, but did 

not seek foreclosure on the deeds of trust. And, even allowing for tolling of 

limitations during the bankruptcies, she argued that the latest that limitations could 
6 

have expired was June 25, 2016, long before the Bank sought its remedy under the 

deed of trust. Consequently, she asserted the trial court should declare that her 

judgment lien was superior to the Bank’s. 

The Bank responded to the motion and filed its own traditional motion for 

summary judgment on the ground that limitations had not run on its deed of trust 

lien because limitations was tolled not only by the three bankruptcy proceedings and 

subsequent receivership but also by the underlying Morris litigation in which Morris 

filed a counterclaim challenging the validity of the lien. Alternatively, it argued the 

federal “extender” statute extended limitations to six years instead of four. See 12 

U.S.C. § 1821(d)(14)(B). 

The trial court granted the Banks’s motion for summary judgment and denied 

Castillo’s. The trial court decreed that (1) the Bank’s lien is superior to Castillo’s 

“purported abstract of judgment lien”; (2) the sale of the property was free and clear 

of Castillo’s purported lien; and (3) the Bank had the exclusive right to and is entitled 

to the escrowed funds. Finally, the trial court ordered that the Bank recover its 

attorney’s fees from Castillo. Castillo appealed. 

Standard of Review 

 We review the trial court’s ruling on a motion for summary judgment de novo. 

Travelers Ins. Co. v. Joachim, 315 S.W.3d 860, 862 (Tex. 2010). To prevail on a 

traditional motion for summary judgment, the moving party has the burden to 
7 

demonstrate that no genuine issue of material fact exists and, therefore, it is entitled 

to judgment as a matter of law. TEX. R. CIV. P. 166a(c); Lightning Oil Co. v. 

Anadarko E & P Onshore, LLC, 520 S.W.3d 39, 45 (Tex. 2017). More specifically, 

the moving party must present evidence conclusively establishing its claim or 

negating an element of the respondent’s claim or defense as a matter of law. KCM 

Fin. LLC v. Bradshaw, 457 S.W.3d 70, 79 (Tex. 2015). When considering whether 

this burden has been met, we review the evidence in the light most favorable to the 

nonmovant, indulge every reasonable inference in the nonmovant’s favor, and 

resolve all doubts against the motion. Lightning Oil Co., 520 S.W.3d at 45. If both 

parties move for summary judgment and the trial court grants one motion and denies 

the other, we review both parties’ summary judgment evidence and determine all 

questions presented. Id. We then render the judgment the trial court should have 

rendered. Id. 

Analysis

 On appeal, Castillo challenges the trial court’s granting of the Bank’s motion 

for summary judgment and the denial of hers. She argues that her judgment lien on 

the property is the only valid lien and has priority over the one claimed by the Bank. 

Specifically, she asserts that (1) even considering tolling as a result of the intervening 

bankruptcy cases, limitations would have expired long before the Bank sought a 

remedy under its deed of trust and (2) there were no circumstances giving rise to a 
8 

tolling of limitations other than the bankruptcy stays. As to the second argument, 

she asserts the 2011 Morris litigation did not toll limitations and the federal 

“extender statute” did not extend limitations to six years. Because we conclude the 

Morris litigation is dispositive of the issue, we begin with it. 

 The statute of limitations for a lien under a deed of trust is four years. Under 

section 16.035(a), a person must bring suit for the recovery of real property or the 

foreclosure of a real property lien not later than four years after the day the cause of 

action accrues. TEX. CIV. PRAC. & REM. CODE ANN. § 16.035(a). A “real property 

lien” includes a deed of trust. See id. § 16.035(g)(2). Section 16.035(b) provides 

that a sale of real property under a power of sale in a mortgage or deed of trust that 

creates a real property lien must be made not later than four years after the date the 

cause of action accrues. Id. § 16.035(b) (West 2002). Once limitations expires, the 

real property lien and a power of sale to enforce the real property lien become void. 

Id. § 16.035(d). 

 The cause of action for foreclosure of a deed of trust lien accrues––and 

limitations commences––on the maturity date of the final installment or when the 

holder exercises its option to accelerate. See Hardy v. Wells Fargo Bank, N.A., No. 

01-12-00945-CV, 2014 WL 7473762, at *3 (Tex. App.—Houston [1st Dist.] Dec. 

30, 2014, no pet.) (mem. op.) (if no acceleration, holder’s cause of action for 

foreclosure accrues on maturity date of final installment); PNC Mortg. v. Howard, 
9 

No. 05-17-01484-CV, 2019 WL 2575052, at *6 (Tex. App.—Dallas June 24, 2019, 

pet. filed) (mem. op.) (explaining that once note is accelerated, cause of action for 

foreclosure of deed of trust lien securing note accrues and sale of property must 

occur within four years). Unequivocal action, such as filing suit indicating that the 

entire debt is due, is sufficient to show acceleration. See Joy Corp. v. Nob Hill N. 

Props., Ltd., 543 S.W.2d 691, 694–95 (Tex. Civ. App.—Tyler 1976, no pet.). 

 Here, the evidence showed that the maturity date on Note 1 was July 11, 2012. 

Before that date, however, the Bank sued Morris for breach of the Note on May 2, 

2011, which was the equivalent of accelerating the Note. See id., 542 S.W.2d at 

694–95. Consequently, the cause of action on Note 1 accrued on May 2, 2011 and, 

absent any tolling, limitations expired on May 2, 2015.1

 Note 2, however, accrued 

on its maturity date, which was September 15, 2009. See Hardy, No. 01-12-00945-

CV, 2014 WL 7473762, at *3. Thus, absent any tolling provision, limitations of 

Note 2 expired on September 15, 2013. 

 The Bank asserts limitations was tolled by the Morris litigation when Morris 

counterclaimed, challenging both his liability on the Notes and the validity of the 

 1

 The Bank argues the accrual date on this Note was January 27, 2012, a date it pulls from its first 

amended petition in the Morris litigation. The Bank provides no authority for its position and does not 

explain why the date of the original petition is not controlling. In its motion, it simply claimed that Morris 

did not dispute that date in the underlying suit and “[f]or that reason it is used in this action.” Even assuming 

the truth of that statement, Castillo was not a party to the Morris suit and the Bank does not explain how 

Castillo would therefore be bound by Morris’s failure to object in that action. Regardless, given our analysis 

with respect to the tolling of the underlying litigation, our result would be the same under either date. 
10 

deed of trust lien. The Bank argues limitations was tolled from the date of the 

counterclaim, February 18, 2013, until the appeals ended on October 1, 2018, 

rendering the Bank’s rights under the deed of trust valid at the time it sought a forced 

sale through a receiver in October 2017. Castillo does not dispute that if the 

underlying Morris litigation tolled limitations in this case, then the Bank’s rights 

under the deed of trust were not lost to limitations. But, Castillo disputes that the 

Morris litigation tolled limitations. 

 The primary purpose of limitations statutes is to prevent litigation of stale or 

fraudulent claims. Erikson v. Renda, 590 S.W.3d 557, 569 (Tex. 2019). Limitations 

statutes afford plaintiffs what the legislature deems a reasonable time to present their 

claims and protection for defendants and the courts from having to deal with cases 

in which the search for the truth may be seriously impaired by the loss of evidence, 

whether by death or disappearance of witnesses, fading memories, disappearance of 

documents, or otherwise. Id. 

 At the same time, Texas courts have long recognized that “[w]here a person 

is prevented from exercising his legal remedy by the pendency of legal proceedings, 

the time during which he is thus prevented should not be counted against him in 

determining whether limitations have barred his right.” Cavitt v. Amsler, 242 S.W. 

246, 249 (Tex. App.—Austin 1922, writ dism’d w.o.j.) (op. on mot. for reh’g). In 

Cavitt, the plaintiff (Cavitt) sued Amsler to have shares in a milling company that 
11 

were in Amsler’s name canceled and reissued to him, alleging he was owner. Cavitt 

recovered judgment in that case establishing his ownership. Id. at 248. 

Subsequently, he filed a petition for mandatory injunction to compel the milling 

company to recognize him as a stockholder by issuing the Amsler stock to him, 

alleging that, despite the judgment in his favor, the company had refused to do so. 

He also alleged the company was paying the dividends to Amsler. Soon after the 

second suit was filed, Amsler appealed the judgment in the first lawsuit, which 

postponed the second suit pending the resolution of the appeal. The appeals court 

subsequently affirmed the first judgment on January 19, 1920. Cavitt subsequently 

obtained judgment in the injunction suit. Id. 

 The suit that was the focus of the appeal involved Cavitt’s claim to recover 

dividends paid by the milling company to Amsler. Id. at 246. Cavitt lost that suit, 

and the question on appeal was whether Cavitt’s cause of action was barred by 

limitations. In ruling in Cavitt’s favor, the court reasoned as follows: 

 We hold that the statute of limitations was suspended during the 

appeal referred to, for the reasons that, if [Cavitt] knew that the milling 

company was paying dividends to Amsler, and had filed suit against the 

company and against Amsler to recover the same, the company could 

and doubtless would have replied that the issue involved in such suit 

was the ownership of the stock claimed by both Amsler and Cavitt; that 

Cavitt could not recover dividends until he established his title to the 

stock; and that this was the issue pending in the case on appeal. 

Id. at 248–49. Thus, limitations on the suit for dividends was tolled while the suit 

to determine ownership of the stock was being appealed. 
12 

Decades later, when the Texas Supreme Court considered for the first time 

tolling limitations in attorney malpractice cases, it relied on the principle set out in 

the Cavitt case. See Hughes v. Mahaney & Higgins, 821 S.W.2d 154, 157 (Tex. 

1991). The court applied the same rationale to a client’s subsequent malpractice 

claim against his attorney reasoning, among other things, that the viability of the 

second cause of action depended on the outcome of the first. Id. at 157. The court 

subsequently reaffirmed what has since been called the Hughes rule, explaining that 

we must “appropriately balance the competing concerns of the need to bar stale 

claims and avoid prejudice to defendants yet preserve a reasonable opportunity for 

plaintiffs to pursue legitimate claims.” See Apex Towing Co. v. Tolin, 41 S.W.3d 

118, 122 (Tex. 2001). 

In sum, cases such as Cavitt and Hughes and its progeny teach that a statute 

of limitations is tolled for a second cause of action in instances where the viability 

of that second cause of action necessarily depends upon the outcome of the first case 

and the pursuit of the second case prior to that outcome would either be improper or 

result in judicial complications. See Rogers v. Ricane Enters., 930 S.W.2d 157, 167 

(Tex. App.—Amarillo 1996, writ denied) (op. on remand). 

Applying that principle here, we conclude limitations was tolled by the Morris

litigation. In the first cause of action, the Bank sued Morris to recover on the two 

notes secured by the property, and Morris counterclaimed, challenging his 
13 

responsibility on the notes as well as the validity of the liens securing those notes. 

Once the Bank established Morris’s liability on the notes and defeated his claim as 

to the validity of the liens, it requested the trial court appoint a receiver to sell the 

property and distribute the proceeds to it. Under the particular circumstances at issue 

here, requiring the Bank either to foreclose on liens while their validity was under 

attack or lose their rights under the statute of limitations created the kind of judicial 

impediment contemplated by the court in Cavitt. Castillo argues that the Bank was 

not prevented from seeking foreclosure during the Morris suit. While that is true, 

just as the court explained in Cavitt, had the Bank sought to foreclose, Castillo 

“could and doubtless would” have taken action to stop a sale of the property until 

the issues in the suit were resolved. See Cavitt, 242 S.W. at 249. “[T]he policy 

underlying the concept of tolling the statute of limitations for a second or dependent 

cause of action is that the courts will not require a party to do a useless, burdensome, 

or duplicative act that ties up both litigant and court time unnecessarily, either 

without a chance of final resolution (until the underlying suit is resolved) or creating 

the possibility of conflicting results if two different suits were filed.” Ricane, 930 

S.W.2d at 167. 

Statutes of limitations are meant to cut off plaintiffs who have slept on their 

rights. S.V. v. R.V., 933 S.W.2d 1, 32 (Tex. 1996) (Owen, J., dissenting). And, it is 

“neither uncommon nor undesirable for a lender, faced with a suit . . . challenging 
14 

its right to foreclose on property, to seek court confirmation that it is within its rights 

and has performed all acts necessary to proceed with foreclosure under a deed of 

trust.” Metcalf v. Wilmington Sav. Fund Soc’y, FSB, No. 03-16-00795-CV, 2017 

WL 1228886, at *4 (Tex. App.—Austin Mar. 29, 2017, pet. denied) (mem. op.). 

Here, the Bank did not slumber on its rights despite efforts by both Morris and 

Castillo to delay collection with the counterclaims and an obstacle course of 

bankruptcy filings. It timely sued Morris for breach of the notes and litigated its 

case as well as the numerous counterclaims propounded by Morris related to the 

notes and the validity of the liens that secured them. The Bank obtained a judgment 

in its favor, and once it was successful in Morris’s first level of appeal, sought a 

receiver to sell the property. 

We conclude the statute of limitations was tolled by the Morris litigation, 

beginning on the date Morris filed his counterclaim, February 18, 2013, and ending 

on the date United States Supreme Court refused review on October 1, 2018. See 

Apex Towing, 41 S.W.3d at 119 (tolling period lasts “until all appeals on the 

underlying claim are exhausted or the litigation is otherwise finally concluded”); 

Cavitt, 242 S.W. at 248–49 (tolling limitations during appeal of underlying case). 

The Bank requested appointment of a receiver to sell the property on September 27, 

2017. The trial court appointed the receiver on October 23, 2017 and ordered the 

property to be sold. The property was subsequently sold on November 20, 2018. 
15 

 Note 1 accrued on May 2, 2011 and had more than two more years remaining 

on limitations when Morris’s counterclaim was filed; Note 2 accrued on September 

15, 2009, and had about seven months remaining on limitations at the time Morris’s 

counterclaim was filed. Accordingly, under any scenario (when the Bank requested 

the property sold, when the trial court appointed a receiver and ordered the property 

sold, or when the sale was completed), the Bank’s deed of trust liens were not void 

because limitations had not run. The Bank conclusively established that limitations 

did not bar its claims. Accordingly, the trial court did not err in granting the Bank’s 

motion for summary judgment, declaring the Bank’s lien superior to Castillo’s, and 

ordering the Bank had the exclusive right to the funds held in escrow. We overrule 

Castillo’s issues. 

We affirm the trial court’s judgment. 

 

 

190854F.P05 

 

/Amanda L. Reichek/ 

AMANDA L. REICHEK 

JUSTICE 
16 

S 

Court of Appeals 

Fifth District of Texas at Dallas 

JUDGMENT 

SONIA M. CASTILLO, Appellant 

No. 05-19-00854-CV V. 

BRANCH BANKING & TRUST 

COMPANY, SUCCESSOR-ININTEREST TO COLONIAL BANK, 

Appellee 

 On Appeal from the 68th Judicial 

District Court, Dallas County, Texas 

Trial Court Cause No. DC-18-16153. 

Opinion delivered by Justice 

Reichek; Justices Myers and PartidaKipness participating. 

 In accordance with this Court’s opinion of this date, the judgment of the trial 

court is AFFIRMED. 

 It is ORDERED that appellee BRANCH BANKING & TRUST 

COMPANY, SUCCESSOR-IN-INTEREST TO COLONIAL BANK recover its 

costs of this appeal from appellant SONIA M. CASTILLO. 

Judgment entered April 27, 2020