Court Opinion

ID: 9363601
Source: CourtListenerOpinion
Date Created: 2023-01-16 19:00:35.846513+00
Date Added: 2024-06-11T17:15:32.789934
License: Public Domain

Case: 21-11251        Document: 00516611530            Page: 1      Date Filed: 01/16/2023

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

                                                                                      FILED
                                                                               January 16, 2023
                                        No. 21-11251                             Lyle W. Cayce
                                                                                      Clerk

   U.S. Bank National Association, as Trustee, successor
   in interest to Bank of America, National Association,
   as Trustee, successor by merger to LaSalle Bank
   National Association, as Trustee, for Residential
   Asset Mortgage Products, INC., Mortgage Asset-
   Backed Pass-Through Certificates, Series 2007-R,

                                                                    Plaintiff—Appellee,

                                            versus

   Kevin G. Bates; Regina Bates,

                                                               Defendants—Appellants.

                     Appeal from the United States District Court
                         for the Northern District of Texas
                               USDC No. 4:20-cv-965

   Before Jones, Southwick, and Ho, Circuit Judges.
   Per Curiam:*
         This appeal arises out of a mortgage foreclosure suit, in which the
   Plaintiff creditor successfully sought summary judgement against a

         *
             This opinion is not designated for publication. See 5th Cir. R. 47.5.
Case: 21-11251         Document: 00516611530        Page: 2    Date Filed: 01/16/2023

                                     No. 21-11251

   Defendant debtor. Because the appeal has been rendered moot by Plaintiff’s
   sale of the property in question, we dismiss the appeal.
                                          I.
          On or around October 25, 2000, Defendant Kevin Bates obtained a
   mortgage loan by executing a Texas Home Equity Adjustable Rate Note. The
   Note was secured by a Texas Home Equity Security Instrument, signed by
   both Defendants, which encumbered the property located at 1012 South
   Hollow Drive, Southlake, Texas 76092 (“the Property”).
          On July 24, 2020, Plaintiff’s mortgage servicer notified Defendants
   that they were in default. Plaintiff filed suit against Defendants seeking
   judicial foreclosure. Plaintiff sought and the district court granted summary
   judgment, which Defendants now appeal.
          After noticing this appeal, Defendants filed a motion in the district
   court asking the court to set a bond to stay the upcoming scheduled sale of
   the Property by the Plaintiff. See Fed. R. Civ. P. 62(b). The district court
   issued an order requiring Defendants to post a $387,000 bond—worth about
   one-third of the outstanding debt—to obtain a stay of the court’s judgment.
   Defendants did not post the bond. Subsequently, Defendants sought an
   emergency stay in this court, which we denied. See Fed. R. App. Proc. 8.
          Following these proceedings, Plaintiff scheduled a foreclosure sale of
   the Property for June 7, 2022. That morning, Defendants filed a Notice of
   Lis Pendens. Plaintiff subsequently conducted the sale and sold the property
   to a third party.
          Plaintiff has now filed a motion in this court to dismiss the appeal as
   moot because of the sale, which Defendants oppose. In its reply, Plaintiff also
   moved to cancel or expunge the lis pendens. Defendants moved for leave to
   file a sur-reply to Plaintiff’s motion, which Plaintiff opposes.

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Case: 21-11251      Document: 00516611530            Page: 3   Date Filed: 01/16/2023

                                      No. 21-11251

                                           II.
          “Ordinarily, an appeal will be moot when the property underlying the
   dispute has been sold at a foreclosure sale because this court cannot fashion
   adequate relief, i.e., cannot reverse the transaction.” Christopher Vill., Ltd.
   P’ship v. Retsinas, 190 F.3d 310, 314 (5th Cir. 1999). “If the debtor fails to
   obtain a stay, and if the property is sold in the interim, the . . . court will
   ordinarily be unable to grant any relief” and “the appeal will be moot.”
   Matter of Sullivan Cent. Plaza, I, Ltd., 914 F.2d 731, 733 (5th Cir. 1990), on
   reh’g sub nom. Matter of Sullivan Cent. Plaza I, Ltd., 935 F.2d 723 (5th Cir.
   1991). Both sides acknowledge this baseline rule.
          Nevertheless, Defendants contend that their lis pendens filing means
   that relief may be granted with regards to the subsequent purchaser’s title to
   the Property—and that the appeal is not moot. But by its plain terms, the lis
   pendens statute makes clear that the procedure is available only to “a party
   to the action who is seeking affirmative relief.” Tex. Prop. Code §
   12.007(a). See also In re Jamail, 156 S.W.3d 104, 107 (Tex. App. 2004);
   Brown v. Martin, 2011 WL 3366359, at *2 (Tex. App. Aug. 4, 2011). Here,
   neither the Defendants’ original Answer nor their operative First Amended
   Answer offer any basis on which they seek affirmative relief in this suit.
   Consequently, the lis pendens filed by Defendants is “void.” Helmsley-Spear
   of Texas, Inc. v. Blanton, 699 S.W.2d 643, 645 (Tex. App. 1985). And
   “[w]hen a lis pendens is not authorized under Texas law, the court need not
   follow the procedures prescribed by [the statute] to cancel it.” Matter of
   Texas Extrusion Corp., 844 F.2d 1142, 1153 (5th Cir. 1988).
                                           III.
          We grant Plaintiff’s motion to dismiss the appeal as moot. We also
   grant Plaintiff’s motion to cancel the lis pendens. We deny Defendant’s
   motion for leave to file a sur-reply.

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