Court Opinion

ID: 9388895
Source: CourtListenerOpinion
Date Created: 2023-04-22 00:00:35.440461+00
Date Added: 2024-06-11T17:18:23.418451
License: Public Domain

Case: 22-20061     Document: 00516722008         Page: 1     Date Filed: 04/21/2023

              United States Court of Appeals
                   for the Fifth Circuit
                                                                      United States Court of Appeals
                                                                               Fifth Circuit

                                                                             FILED
                                  No. 22-20061                           April 21, 2023
                                Summary Calendar
                                                                        Lyle W. Cayce
                                                                             Clerk
   Kenneth Wayne Benjamin,

                                                           Plaintiff—Appellant,

                                       versus

   The Bank of New York Mellon, as Trustee (CWALT 2005-
   J2), formerly known as The Bank of New York; Bayview
   Loan Servicing, L.L.C.; John Doe 1; John Doe 2; Hughes,
   Watters & Askanase, L.L.P.; Rachel Donnelly,

                                                         Defendants—Appellees.

                  Appeal from the United States District Court
                      for the Southern District of Texas
                           USDC No. 4:20-cv-00214

   Before Jones, Haynes, and Oldham, Circuit Judges.
   Per Curiam:*
          This appeal stems from an $88,000 home equity loan to plaintiff-
   appellant Kenneth Benjamin, issued by defendant-appellee Bank of New

          *
            Pursuant to 5th Circuit Rule 47.5, the court has determined that this
   opinion should not be published and is not precedent except under the limited
   circumstances set forth in 5th Circuit Rule 47.5.4.
Case: 22-20061      Document: 00516722008          Page: 2   Date Filed: 04/21/2023

                                    No. 22-20061

   York Mellon’s assignor in November 2004. In 2017, Benjamin filed for
   bankruptcy, and in late 2019, the Bank sought to foreclose on the loan.
   Benjamin sued in Texas state court to halt foreclosure. In January 2020,
   defendants timely removed to the Southern District of Texas under 28
   U.S.C. § 1441, based on diversity jurisdiction.
          Benjamin’s pro se complaint alleged, inter alia, breach of contract,
   fraud, civil conspiracy, misconduct by defendants’ attorneys, violations of
   provisions of the Texas Constitution governing property loans, and
   intentional infliction of emotional distress. Benjamin sought money damages
   as well as declaratory and injunctive relief that would obviate the loan and
   avert the Bank’s attempt at foreclosure.
          In December 2020, a federal magistrate judge issued a 30-page
   memorandum that recommended dismissal of several defendants and most
   of Benjamin’s claims. The district court adopted the magistrate’s
   recommendation without alteration. The rump of the complaint proceeded
   to discovery. During litigation, the magistrate judge made various procedural
   and evidentiary decisions Benjamin opposed, and the district court denied
   Benjamin’s objections to the magistrate’s orders. At the close of discovery,
   the magistrate judge recommended entering summary judgment for the
   defendants. The district court again agreed.
          Benjamin appealed, asking us to revive his dismissed claims, reverse
   various pre-trial orders, and reverse the district court’s grant of summary
   judgment in favor of defendants.
          After carefully reviewing the record, we generally agree with the
   district court and need not add to its careful resolution of the case. Only two
   of Benjamin’s numerous contentions merit additional discussion.

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                                    No. 22-20061

                                         A.
          The first relates to the “notice of default” that the Bank sent to
   Benjamin in October 2021 by certified mail. The use of certified mail
   conforms to state statute, which requires that “notwithstanding any
   agreement to the contrary,” the mortgage servicer must send “written notice
   by certified mail” before a sale of real property under a contract lien. Tex.
   Prop. Code § 51.002(d). Benjamin argues that the use of certified mail was
   nevertheless insufficient because it did not conform to his security
   agreement, and therefore the Bank was not entitled to accelerate his loan.
   Specifically, the agreement deems notice effective when it is “mailed by first
   class mail or when actually delivered to Borrower’s notice address if sent by
   other means.” To Benjamin, certified mail is “other means,” so the Bank
   must prove actual delivery, which Benjamin disputes.
          Benjamin first contends that Texas law defines certified mail as
   distinct from first class mail. See Tex. Gov. Code §§ 80.001–04. But
   Benjamin’s reliance on that statute is misplaced. Section 80.004
   distinguishes certified from first class mail only “in this chapter.” And
   § 80.004 pertains to court communications, not Benjamin’s dispute.
          Next, Benjamin argues that precedent relied on by the district court
   and by appellees does not adequately support the equilibration between first
   class and certified mail. It is true that we have described certified mail as “a
   special type of first class mail whose primary purpose is to provide evidence
   of an individual’s receipt of delivery.” Degruise v. Sprint Corp., 279 F.3d 333,
   337 (5th Cir. 2002). But that case centered on federal, not Texas, law. In
   another case concerning a Texas security agreement with language closely
   tracking the security agreement at issue here, our court did not address head-
   on whether certified mail counted as first class mail, because delivery was not

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                                     No. 22-20061

   in dispute. King v. Select Portfolio Servs. Inc., 740 F. App’x 814, 817 (5th Cir.
   2018) (per curiam).
          But even if our prior cases leave open the possibility that certified mail
   is not first class mail in the context of this dispute, Benjamin does not provide
   a reason why we should resolve the question in his favor. The use of certified
   mail does not prejudice the recipient, relative to first class mail; rather, it
   merely provides to the sender the added benefit of confirmation of delivery.
   That Texas Property Code § 51.002(d) requires default notices to be sent by
   certified mail further suggests to us that certified mail suffices when a Texas
   security agreement calls for first class mail.
          We therefore see no reason to disrupt the district court’s conclusion
   that the notice sent to Benjamin properly counted as first class mail. All of
   Benjamin’s claims relying on a contrary view were properly dismissed.
                                          B.
          Another branch of Benjamin’s claims rests on the allegation that 18
   years ago, the originating bank did not comply with the “12-day rule” in the
   Texas Constitution. That rule denies remedies to creditors where the loan
   closed less than 12 days after the later of (1) the date of the loan application
   and (2) the date certain statutory notices were provided. See Tex. Const.
   art XVI, § 50(a)(6)(M). The district court entered summary judgment for
   the defendants on these claims.
          No party disputes that Benjamin’s loan closed on November 30, 2004.
   To survive summary judgment on his 12-day rule claim, Benjamin must
   articulate a genuine dispute as to whether the loan application or statutory
   notices postdated November 18, 2004.
           Start with the statutory notice. The record contains the relevant
   notice, bearing Benjamin’s signature, dated November 4, 2004, and marked

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                                    No. 22-20061

   with a November 17 fax-machine timestamp. Benjamin did not dispute the
   authenticity of the document when it was presented to him in deposition. His
   subsequent allegation of forgery is the sort of “unsubstantiated assertion”
   that does not prevent summary judgment. Boudreaux v. Swift Transp. Co.,
   402 F.3d 536, 540 (5th Cir 2005) (quotation omitted).
          Finally, the loan application. Although Benjamin disputes the date on
   which he first signed a loan application (again alleging forgery), he does not
   dispute that he made an application by telephone on November 4, 2004. That
   counts; § 50(a)(6)(M) requires “a loan application,” not necessarily a
   written one. It is true that, at the time of Benjamin’s loan, the then-current
   version of § 50(a)(6)(M) appeared to conflict with the then-current version
   of § 50(g), which proscribed mandatory loan disclosures that contained the
   phrase “written application” when discussing the 12-day rule. Our court,
   however, confronted exactly this challenge in Cerda v. 2004-EQR1 LLC, 612
   F.3d 781 (5th Cir. 2010). Relying on Texas Supreme Court precedent, we
   determined that a telephone application sufficed for the purposes of the 12-
   day rule. Id at 788–89.
          AFFIRMED.

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