Court Opinion

ID: 4586751
Source: CourtListenerOpinion
Date Created: 2020-11-17 00:09:56.703537+00
Date Added: 2024-06-11T13:48:46.379574
License: Public Domain

IN THE COURT OF APPEALS OF THE STATE OF WASHINGTON

 DEUTSCHE BANK NATIONAL                       No. 80913-0-I
 TRUST COMPANY, as trustee for
 Saxon Asset Securities Trust                 DIVISION ONE
 2006-2 Mortgage Loan Asset
 Backed Certificates Series 2006-2,           UNPUBLISHED OPINION

                        Respondent,

                v.

 MICHAEL SHIELDS and BONNIE
 SHIELDS,

                        Appellants,

 FIDELITY NATIONAL TITLE
 INSURANCE COMPANY; SAXON
 MORTGAGE, INC., all occupants
 of the premises; and all other
 persons or parties unknown
 claiming any right, title, estate, lien,
 or interest in the real estate
 described in the complaint herein,

                       Defendants.

       SMITH, J. — Michael and Bonnie Shields appeal the denial of their motion

to vacate a foreclosure judgment as void. Shields contends that the court that

granted the foreclosure did not have jurisdiction because a different judge at the

superior court had stayed proceedings in a related action. Because the court

had jurisdiction over the foreclosure action and the related proceedings were

stayed only as to a third party, we affirm.

 Citations and pin cites are based on the Westlaw online version of the cited material.
No. 80913-0-I/2

                                      FACTS

       Michael Shields took out a mortgage in 2006 against a home (property)

which his sister Bonnie was living in. Shields explains that this mortgage was

granted on different terms than those Shields had agreed to, and the mortgage

was ultimately the source of significant dispute and litigation. In 2008, Shields

defaulted on the loan. Deutsche Bank National Trust Company, the holder of the

deed of trust for the property, initiated several trustee sales which were

subsequently discontinued.

       In 2012, Shields filed a lawsuit in King County Superior Court against

several parties, including Deutsche Bank and Regional Trustee Services

Corporation,1 the purported trustee for the property. Shields’s lawsuit sought to

enjoin the pending nonjudicial foreclosure sale and alleged that the defendants

had violated the Washington Consumer Protection Act (CPA), chapter 19.86

RCW, through misrepresentations regarding the transfer of the mortgage

promissory note and the basis for the foreclosure proceeding. Two days later,

Regional discontinued the pending trustee’s sale.

       On July 25, 2014, the trial court for the 2012 action granted a motion for

summary judgment which purported to dismiss all claims against Deutsche Bank

but not against Regional. The order did not include any findings, as provided for

in CR 54(b), that there was no just reason for delay. On August 5, the court

entered an order appointing a receiver for Regional, and the case was stayed

       1  Regional later changed its name to Old RTSC Corp. For simplicity, we
refer to it as “Regional.”

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No. 80913-0-I/3

pursuant to RCW 7.60.110.

       On August 15, 2014, Deutsche Bank filed a judicial foreclosure action

against Shields, also in King County Superior Court, but the action was assigned

to a different judge. Regional was not listed as a party. On February 10, 2016,

the trial court for the 2014 action granted Deutsche Bank’s motion for summary

judgment and entered a decree of foreclosure.

       On April 8, 2016, Shields filed an appeal of the foreclosure order. On April

13, 2016, Shields’s 2012 CPA lawsuit, which had been largely inactive since the

stay was ordered, was dismissed without prejudice.

       We affirmed the foreclosure order. Deutsche Bank Nat’l Tr. Co. for Saxon

Asset Sec. Tr. 2006-2 Mortgage Loan Asset Backed Certificates Series 2006-2 v.

Shields, No. 75044-5-I (Wash. Ct. App. Oct. 2, 2017) (unpublished),

http://www.courts.wa.gov/opinions/pdf/750445.PDF. On July 27, 2018, we

issued a mandate terminating review. Subsequently, Shields filed a motion to

vacate the foreclosure order, contending that the order was void because the

2014 court did not have jurisdiction to hear the case. The trial court denied the

motion to vacate, holding that the 2014 court had proper jurisdiction over

Deutsche Bank’s 2014 foreclosure action. Shields appeals.

                                    ANALYSIS

       Shields contends that the trial court erred in denying the motion to vacate.

Shields asserts that the foreclosure order was void because the 2012 court

retained jurisdiction over the parties and the property until the 2012 action was

dismissed. Shields also contends Deutsche Bank could not file its foreclosure

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No. 80913-0-I/4

complaint while the 2012 action was stayed. We disagree.

                                 Standard of Review

       Generally, a trial court’s order on a motion to vacate is reviewed for abuse

of discretion. Larson v. State, 9 Wash. App. 2d 730, 744, 447 P.3d 168 (2019),

review denied, 194 Wash. 2d 1019 (2020). However, courts have “a

nondiscretionary duty to vacate void judgments.” Leen v. Demopolis, 62 Wn.

App. 473, 478, 815 P.2d 269 (1991). Therefore, we review a decision whether to

vacate a judgment for voidness de novo. Ahten v. Barnes, 158 Wash. App. 343,

350, 242 P.3d 35 (2010) (quoting Dobbins v. Mendoza, 88 Wash. App. 862, 871,

947 P.2d 1229 (1997)).

       CR 60(b)(5) permits a court to vacate a judgment if the judgment is void.

A court’s judgment is void if the court “‘lacks jurisdiction of the parties or of the

subject matter, or . . . lacks the inherent power to make or enter the particular

order involved.’” Metro. Fed. Sav. & Loan Ass’n of Seattle v. Greenacres Mem’l

Ass’n, 7 Wash. App. 695, 699, 502 P.2d 476 (1972) (quoting Robertson v.

Commonwealth, 181 Va. 520, 536, 25 S.E.2d 352 (1943)). However, if a court

has jurisdiction, “‘no error in the exercise of such jurisdiction can make the

judgment void.’” Greenacres, 7 Wash. App. at 700 (quoting Dike v. Dike, 75 Wash. 2d
1, 8, 448 P.2d 490 (1968)). Accordingly, the question of whether an order is void

does not depend on whether it was rightly decided, but only on whether the court

had jurisdiction to enter it.

              Trial Court’s Jurisdiction To Hear the Foreclosure Action

       Shields contends that the 2014 court did not have jurisdiction to hear

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No. 80913-0-I/5

Deutsche Bank’s 2014 action because Deutsche Bank was still a party to the

2012 action when it filed its complaint. We agree that Deutsche Bank was still a

party but disagree that the 2014 court did not have jurisdiction.

       CR 54(b) addresses judgments in cases with multiple parties and provides

that “the court may direct the entry of a final judgment as to . . . fewer than all of

the . . . parties only upon an express determination in the judgment, supported by

written findings, that there is no just reason for delay and upon an express

direction for the entry of judgment.” Furthermore, “[i]n the absence of such

findings, determination and direction, any order . . . which adjudicates . . . the

rights and liabilities of fewer than all the parties shall not terminate the action as

to any of the . . . parties.” CR 54(b). If these findings have been omitted, the trial

court may revise the order to add them on its own motion or on motion of a party.

CR 54(b).

       “Under the priority of action rule, the trial court which first obtains

jurisdiction is the court in which this matter will normally proceed.” Seattle

Seahawks, Inc. v. King County, 128 Wash. 2d 915, 916, 913 P.2d 375 (1996); see

also RCW 4.28.020 (“From the time of the commencement of the action . . . the

court is deemed to have acquired jurisdiction and to have control of all

subsequent proceedings.”). Thus, if complaints are filed in two different courts,

we will ask whether the actions share the same subject matter, parties, and relief,

to determine whether a decision in one court would bar proceedings in the other.

In re Matter of 13811 Highway 99, Lynnwood, Washington, 194 Wash. App. 365,

374, 378 P.3d 568 (2016) (quoting Bunch v. Nationwide Mut. Ins. Co., 180 Wash.
5
No. 80913-0-I/6

App. 37, 41-42, 321 P.3d 266 (2014)).

       In this case, the order dismissing Deutsche Bank from the 2012 action did

not include the findings described in CR 54(b) that there was “no just reason for

delay.” As such, Shields correctly notes that the order failed to dismiss Deutsche

Bank from the action.

       Nonetheless, this failure did not strip the 2014 court of authority to hear

the 2014 action. Shields does not contend that the superior court as a whole

lacked subject matter jurisdiction to hear the 2014 action, only that the 2014 court

was precluded from hearing it because Deutsche Bank was still a party to the

2012 action.2 However, both the 2012 court and the 2014 court are part of the

same superior court, and it was the King County Superior Court, not a specific

judge, who had jurisdiction over Shields’s 2012 action. See State v. Caughlan,

40 Wash. 2d 729, 731-32, 246 P.2d 485 (1952) (court did not err by hearing motion

to dismiss while case was pending before another department of the same court:

“Although there are sixteen departments in the Superior Court for King County,

each department presided over by a different judge, there is only one Superior

Court for King County, and the authority of all of the judges therein is identical”).3

       2 We further note that there is no basis to conclude that the court lacked
personal jurisdiction over Shields, because the issue of personal jurisdiction is
waived if not raised in or before the responsive pleading. CR 12(h)(1).
       3 Jurisdiction is a potentially ambiguous term. In family law cases in

particular, a specific judge may sometimes choose to retain “jurisdiction” over a
specific matter and instruct parties to bring future disputes before that judge’s
department. In re Marriage of Rounds, 4 Wash. App. 2d 801, 806, 423 P.3d 895
(2018). This use of the word jurisdiction “does not refer to personal jurisdiction or
subject matter jurisdiction.” Rounds, 4 Wash. App. 2d at 802 n.1. As such, the
retention of jurisdiction in that meaning of the word would not strip another judge

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No. 80913-0-I/7

Thus, even if we were to conclude that Deutsche Bank’s 2014 foreclosure action

was substantially the same as Shields’s 2012 CPA action, this would not render

the 2014 court’s order void. While it may have avoided confusion for both

actions to be heard before the same judge, there is no basis to conclude the

judgment was void under CR 60(b)(5).4

                          Effect of the Stay of Proceedings

       Shields contends that the stay of proceedings in Shields’s 2012 action

stripped the 2014 court of authority to hear the 2014 foreclosure action. We

disagree.

       RCW 7.60.110(1)(a) provides that the entry of an order appointing a

receiver automatically initiates a stay of the “commencement . . . of a judicial . . .

proceeding against the person over whose property the receiver is appointed.”

This stay automatically expires 60 days after the order of appointment is entered

unless the court extends it. RCW 7.60.110(2). In some cases, a violation of a

stay is considered void. See Brunetti v. Reed, 70 Wash. App. 180, 184, 852 P.2d
1099 (1993) (action taken in violation of a bankruptcy proceeding stay is void);

but see Everett Shipyard, Inc. v. Puget Sound Envtl. Corp., 155 Wash. App. 761,

769, 231 P.3d 200 (2010) (superior court retained jurisdiction during stay of

proceedings pending arbitration and therefore erred in vacating a dismissal on

in the same court of “the inherent power to make or enter the particular order
involved.” See Greenacres, 7 Wash. App. at 699.
        4 Shields further contends that Deutsche Bank misrepresented facts in the

motion to vacate hearing. Because these facts do not affect whether the
judgment is void, we need not address this argument. See Reed v. Davis, 65
Wash. 2d 700, 709, 399 P.2d 338 (1965) (“We may sustain the trial court on a
correct ground not considered by it.”).

                                              7
No. 80913-0-I/8

the basis that it had not had jurisdiction).

       In this case, a receiver was appointed over Regional’s property, not over

Shields’s property. As such, the stay prohibited the commencement of certain

actions against Regional, but not against Shields. RCW 7.60.110. Because

Deutsche Bank’s 2014 action did not name Regional as a defendant,5 it did not

violate the stay of proceedings. Thus, the 2014 court’s order granting a

foreclosure was not void, and the trial court properly denied the motion to vacate.

       Shields raises concerns about the effect of racial prejudice associated with

mortgage practices when discussing the terms and conditions under which

Shields acquired the mortgage. The fact that racism persists in home lending

practices, with lasting impacts on the access to housing and wealth available to

people of color generally and Black people specifically, has been explored in

legal and academic scholarship.6 While this reality should be kept in mind when

       5  Shields contends that because Deutsche Bank included as a defendant
“all other persons or parties unknown claiming any right, title, estate, lien, or
interest in the real estate described in the complaint herein,” Regional was a
party to the 2014 action. This statement was added pursuant to RCW 4.28.150,
which provides for service by publication for unknown entities, and does not
apply to Regional, whose role as trustee was known. Regional served as a
trustee for the previously attempted nonjudicial foreclosure and did not have a
role in the judicial foreclosure. See Klem v. Washington Mut. Bank, 176 Wash. 2d
771, 789-90, 295 P.3d 1179 (2013) (In a judicial foreclosure, as opposed to a
nonjudicial foreclosure, the judge takes the role of the trustee as the impartial
third party to the sale.).
        6 See, e.g., Benjamin Howell, Exploiting Race and Space: Concentrated

Subprime Lending as Housing Discrimination, 94 CALIF. L. REV. 101, 102 (2006)
(“Where lending discrimination once took a binary form—bigoted loan officers
rejecting loan applicants because of their skin color—the new model of
discrimination is exploitation. Unscrupulous lenders now prey on a history of
racial redlining by aggressively marketing overpriced loan products with onerous
terms in the same neighborhoods where mainstream lenders once refused to
lend.” (citation omitted)).

                                               8
No. 80913-0-I/9

addressing the significant issues surrounding foreclosures, Shields has not

shown that this had any effect on the narrow procedural issue presented in this

case. The trial court did not err.

       Deutsche Bank requests attorney fees on appeal. Attorney fees may be

awarded on appeal where permitted by statute or contract. Aiken v. Aiken, 187
Wash. 2d 491, 506, 387 P.3d 680 (2017). In this case, the deed provides that the

lender is entitled to recover reasonable attorney fees in any action to construe or

enforce the deed. Similarly, the note permits the note holder to recover

reasonable attorney fees in an action to enforce the note. We therefore grant

Deutsche Bank’s request for fees pursuant to RAP 18.1.

       We affirm.

WE CONCUR:

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