Court Opinion

ID: 6341071
Source: CourtListenerOpinion
Date Created: 2022-05-16 18:00:44.16701+00
Date Added: 2024-06-11T08:43:28.280459
License: Public Domain

Case: 21-20533     Document: 00516319819         Page: 1     Date Filed: 05/16/2022

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

                                                                             FILED
                                                                         May 16, 2022
                                  No. 21-20533                          Lyle W. Cayce
                                Summary Calendar                             Clerk

   Dana Dill,

                                                           Plaintiff—Appellant,

                                       versus

   Federal Home Loan Mortgage Corporation;
   LoanDepot.com, L.L.C.,

                                                         Defendants—Appellees.

                  Appeal from the United States District Court
                      for the Southern District of Texas
                           USDC No. 4:19-CV-4755

   Before Clement, Ho, and Oldham, Circuit Judges.
   Per Curiam:*
          Dana Dill is a Texas homeowner who sought to refinance her home.
   In 2016, she obtained a home equity loan. The Federal Home Loan Mortgage
   Corporation (Freddie Mac) is the owner and holder of the note and

          *
            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   opinion should not be published and is not precedent except under the limited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: 21-20533        Document: 00516319819              Page: 2       Date Filed: 05/16/2022

                                          No. 21-20533

   LoanDepot.com, LLC (LoanDepot) is the servicer of the loan. 1 Dill sued
   Freddie Mac and LoanDepot (Appellees), arguing that they forfeited their
   right to all principal and interest from the loan because they failed to cure a
   defect in the closing documents.             A jury ultimately found in favor of
   Appellees, the district court denied Dill’s motion for a new trial and entered
   judgment, and Dill appealed.
           Dill argues that she is entitled to a free home because she signed her
   closing documents in the wrong location. We are unpersuaded. The parties’
   closing documents state that § 50(a)(6) of the Texas Constitution strictly
   governs the loan. Section 50(a)(6)(N) states that home equity loan closing
   documents may only be executed “at the office of the lender, an attorney at
   law, or a title company.” TEX. CONST. art. XVI, § 50(a)(6)(N). Pursuant to
   § 50(a)(6)(Q)(x), if a lender fails to comply with § 50(a)(6)(N), they have 60
   days to cure their defect. Failure to cure that defect, however, results in the
   lender forfeiting “all principal and interest of the extension of credit.” Id. at
   § 50(a)(6)(Q)(x).
           Dill claims that Appellees forfeited their rights pursuant to
   § 50(a)(6)(Q)(x) because: (1) she closed on the loan at her kitchen table; (2)
   she notified Appellees of this defect a few years later; and (3) Appellees failed
   to cure the defect. She also asserts that the district court erred in when it
   instructed the jury to not only consider whether the contract was breached,
   but to also consider whether that breach was material and whether Dill was
   equitably estopped from claiming breach. But Dill’s arguments leave out
   critical facts; namely, that she: (1) filed this lawsuit even though she was not
   under threat of foreclosure; (2) testified that she was happy with the terms of

           1
              JPMorgan Chase Bank briefly served as the servicer of the loan during the initial
   filing of this lawsuit.

                                                2
Case: 21-20533      Document: 00516319819            Page: 3   Date Filed: 05/16/2022

                                     No. 21-20533

   the loan; and (3) swore when executing the notarized loan that she signed it
   in the appropriate location.
          Based on these facts, Dill cannot succeed. Dill invokes § 50(a)(6)(N)
   as an offensive means to receive a free home; not as a defensive provision to
   prevent coercion. The text does not support her claim. According to
   § 50(a)(6)(N), which falls under the heading “Protection of Homestead from
   Forced or Unauthorized Sale”:
          (a) The homestead of a family, or of a single adult person, shall
          be, and is hereby protected from forced sale, for the payment of
          all debts except for:
                  (6) an extension of credit that:
                  (N) is closed only at the office of the lender, an attorney
                  at law, or a title company;

   (emphasis added). Read in context, the provision protects homeowners from
   forced, coercive sales at their homes. Fin. Comm’n of Texas v. Norwood, 418
   S.W.3d 566, 588 (Tex. 2013). It does not serve as a weapon for refinancing
   homeowners who are not in default or threat of foreclosure to get a free loan.
   See generally Garofolo v. Ocwen Loan Servicing, L.L.C., 497 S.W.3d 474, 478
   (Tex. 2016).
          Further, the record supports the jury’s finding that Dill falsely signed
   the closing documents with an intent to deceive; Appellees had no means of
   knowing where Dill signed the documents; and Appellees relied on Dill’s
   sworn misrepresentation to their detriment.
          AFFIRMED.

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