Court Opinion

ID: 4344421
Source: CourtListenerOpinion
Date Created: 2018-11-26 16:08:28.675973+00
Date Added: 2024-06-11T14:49:13.268424
License: Public Domain

MEMORANDUM DECISION

Pursuant to Ind. Appellate Rule 65(D),                                        FILED
this Memorandum Decision shall not be                                    Nov 26 2018, 5:54 am
regarded as precedent or cited before any
                                                                              CLERK
court except for the purpose of establishing                              Indiana Supreme Court
                                                                             Court of Appeals
the defense of res judicata, collateral                                        and Tax Court

estoppel, or the law of the case.

APPELLANTS PRO SE                                       ATTORNEYS FOR APPELLEES
Michael Francis                                         John W. Woodard, Jr.
Carmen Francis                                          Jordan M. White
Indianapolis, Indiana                                   Wyatt, Tarrant & Combs, LLP
                                                        Louisville, Kentucky

                                          IN THE
    COURT OF APPEALS OF INDIANA

Michael Francis and Carmen                              November 26, 2018
Francis,                                                Court of Appeals Case No.
Appellants-Plaintiffs,                                  18A-CT-8
                                                        Appeal from the Marion Superior
        v.                                              Court
                                                        The Honorable Gary L. Miller,
Fannie Mae, Fannie Mae as                               Judge
Trustee for Securitized Trust                           Trial Court Cause No.
Fannie Mae Guaranteed Remic                             49D03-1708-CT-31921
Pass-Through Certifications
1995-16 Trust, JPMorgan Chase
Bank, N.A., EMC Mortgage,
LLC f/k/a EMC Mortgage
Corporation, EMC Mortgage
Corporation, Homesales, LLC,
et. al.,
Appellees-Defendants.

Court of Appeals of Indiana | Memorandum Decision 18A-CT-8 | November 26, 2018                    Page 1 of 11
      Mathias, Judge.

[1]   Michael and Carmen Francis (“the Francises”) appeal the Marion Superior

      Court’s dismissal of their complaint against Fannie Mae, Fannie Mae as

      Trustee, EMC Mortgage LLC, JP Morgan Chase Bank N.A. and Homesales,

      LLC (collectively “the Defendants”). Concluding that the Francises are barred

      from relitigating claims raised in a prior action under the doctrine of res judicata,

      we affirm the dismissal of their complaint.

                                 Facts and Procedural History
[2]   The Francises previously owned residential property in Marion County, subject

      to a real estate mortgage held by Accubanc (“the Property”). The facts

      underlying the disposition of the Property were related in a prior appeal:

              On October 26, 1994, the Francises owned the property at 4904
              North Winston Drive in Indianapolis and executed, in
              Accubanc’s favor, the Note (in the amount of $113,200.00) and
              the Mortgage, granting Accubanc a security interest in the
              Property. Pursuant to the terms of the Note, the maturity date,
              on which all outstanding amounts became due and payable, was
              November 1, 2001. The Mortgage was recorded in the Marion
              County Recorder’s Office on November 1, 1994. Accubanc later
              assigned the Note to Bank United of Texas, FSB, and, on
              February 1, 1997, also assigned the Mortgage to Bank United.
              Washington Mutual Bank, FA, successor by merger to Bank
              United, assigned the Loan Documents to EMC Mortgage
              Corporation on December 22, 2003. On August 13, 2013, in
              response to the Francises’ claims that the Mortgage had been
              assigned to the Federal National Mortgage Association
              (“FNMA”), FNMA quit-claim assigned any interest it may have
              had in the Mortgage to EMC Mortgage Corporation (“the 2013

      Court of Appeals of Indiana | Memorandum Decision 18A-CT-8 | November 26, 2018   Page 2 of 11
        Assignment”). At some point, EMC Mortgage Corporation was
        succeeded in merger by EMC, and the trial court granted EMC’s
        motion to substitute plaintiff on September 15, 2015.

        Meanwhile, the Francises had failed to pay the outstanding
        balance on the Note when it came due on November 1, 2001. On
        May 29, 2007, EMC Mortgage Corporation filed a complaint to
        foreclose on the Mortgage due to the Francises’ failure to make
        payments pursuant to the Note. On September 17, 2007, the
        Francises filed their answer, affirmative defenses, and
        counterclaims. On April 9, 2012, EMC Mortgage Corporation
        filed a motion to strike or for partial summary judgment as to
        certain claims and a designation of evidence. On May 7, 2012,
        the Francises filed a praecipe for withdrawal pursuant to Indiana
        Trial Rule 53.1, and on May 25, 2012, the Indiana Supreme
        Court vested jurisdiction in Marion Superior Court Judge
        Timothy W. Oakes. On May 20, 2013, the trial court granted
        EMC Mortgage Corporation’s partial summary judgment
        motion.

        On October 23, 2013, EMC Mortgage Corporation moved for
        leave to amend its complaint, seeking to incorporate the 2013
        Assignment, which motion the trial court granted. On May 28,
        2015, EMC Mortgage Corporation filed a summary judgment
        motion on its complaint. On February 8, 2016, the trial court
        held a hearing on what was now EMC’s summary judgment
        motion, at which EMC appeared through counsel and Carmen
        Jay Francis appeared in person. On February 17, 2016, the trial
        court granted EMC’s summary judgment motion, entered in rem
        judgment against the Property in [] the sum of $248,709.74,
        ordered that the Property be sold to satisfy the judgment, and
        entered judgment in favor of EMC on all of the Francises’
        remaining counterclaims.

Court of Appeals of Indiana | Memorandum Decision 18A-CT-8 | November 26, 2018   Page 3 of 11
      Francis v. EMC Mortgage, LLC, No. 49A02-1604-MF-830, slip op. at 1–2 (Ind.

      Ct. App. Apr. 19, 2017), trans. denied. The Property was sold, and a Sheriff’s

      Deed was issued in February 2017.

[3]   The Francises filed bankruptcy proceedings and initiated an adversary

      proceeding in the United States Bankruptcy Court for the Southern District of

      Indiana seeking almost $200,000 in damages from EMC Mortgage for an

      allegedly improper foreclosure. The Bankruptcy Court dismissed the adversary

      proceeding for lack of jurisdiction over a state foreclosure action. The Francises

      appealed the decision to the United States District Court for the Southern

      District of Indiana, and the bankruptcy court’s decision was affirmed.

      Appellees’ App. pp. 70–73.

[4]   Thereafter, on August 18, 2017, the Francises filed a “Complaint for Lack of

      Standing to Foreclose, Fraud in the Concealment, Fraud in the Inducement,

      Unconscionable Contract, Breach of Contract, Breach of Fiduciary Duty, Quiet

      Title, Slander of Title, Temporary Restraining Order/Injunctive Relief and Jury

      Demand.” Appellees’ App. pp. 77–99. The Francises named as defendants

      Accubanc, Fannie Mae, EMC Mortgage (a former subsidiary of JP Morgan

      Chase Bank, N.A.), and Homesales, LLC. In the complaint, the Francises

      alleged that the Defendants had no right to foreclose on the real estate because

      the Defendants each failed “to perfect any security interest in the Real Property

      collateral, or cannot prove to the court they have a valid interest as a real party

      in interest to the underlying Mortgage.” Id. at 86. On October 10, 2017, the

      Court of Appeals of Indiana | Memorandum Decision 18A-CT-8 | November 26, 2018   Page 4 of 11
      Francises moved to file an amended complaint; the trial court denied the

      motion on October 16, 2017.

[5]   On October 30, 2017, the Defendants filed a motion to dismiss the Francises’

      complaint on grounds that the claims are barred under principles of res judicata.

      On October 31, 2017, the trial court granted the Defendants’ motion to dismiss

      and ordered that each of the Defendants be dismissed from the action, with

      prejudice.

[6]   On November 29, 2017, the Francises filed a motion to correct error claiming

      that the trial court erred in granting the motion to dismiss before the Francises

      could respond. The motion to correct error was denied on December 4, 2017.

      The Francises now appeal.

                                         Standard of Review

[7]   The Francises appeal the trial court’s dismissal of their complaint. We review

      de novo the trial court’s ruling on a motion to dismiss under Indiana Trial Rule

      12(B)(6). Caesars Riverboat Casino, LLC v. Kephart, 934 N.E.2d 1120, 1122 (Ind.

      2010). “Such a motion tests the legal sufficiency of a claim, not the facts

      supporting it.” Id. “Viewing the complaint in the light most favorable to the

      non-moving party, we must determine whether the complaint states any facts

      on which the trial court could have granted relief.” Id. “If a complaint states a

      set of facts that, even if true, would not support the relief requested, we will

      affirm the dismissal.” McPeek v. McCardle, 888 N.E.2d 171, 174 (Ind. 2008). We

      may affirm the grant of a motion to dismiss if it is sustainable on any theory. Id.

      Court of Appeals of Indiana | Memorandum Decision 18A-CT-8 | November 26, 2018   Page 5 of 11
[8]    The Francises have proceeded pro se throughout these proceedings. We

       therefore observe that a pro se litigant is held to the same standards as a trained

       attorney and is afforded no inherent leniency simply by virtue of being self-

       represented. Zavodnik v. Harper, 17 N.E.3d 259, 266 (Ind. 2014).

                                      Discussion and Decision
[9]    The Francises appeal the dismissal of their complaint and denial of their motion

       to correct error. They continue to argue that EMC Mortgage cannot be

       represented by counsel or participate in this action because the company is

       “defunct” and does not do business in Indiana. See Appellants’ Br. at 44–45.

       And they continue to challenge Accubanc’s assignment of their mortgage to

       another financial institution, which eventually resulted in assignment of the

       Francises’ mortgage to EMC Mortgage.

[10]   The Francises raised these claims in a prior appeal. See Francis, No. 49A02-

       1604-MF-830, slip op. at 1. In that case, we observed that a debtor may not

       challenge an assignment between an assignor and assignee. Id. at 2. We also

       held that

               a borrower does not have standing to challenge an allegedly
               invalid assignment of the right to collect the borrower’s debt.
               Regardless of any assignments of the Note, the Francises’ rights
               and duties remained the same. Even assuming, arguendo, that
               there is some conflict regarding who actually possesses the right
               to enforce the Loan Documents, that is between the various
               claimants to [] that right and does not involve the Francises. The
               Francises do not have standing to challenge an allegedly invalid
               assignment of the Loan Documents to EMC.

       Court of Appeals of Indiana | Memorandum Decision 18A-CT-8 | November 26, 2018   Page 6 of 11
       Id. at 3.

[11]   In that appeal, the Francises also argued that “EMC could not enforce its rights

       pursuant to the Loan Documents because it is not authorized to conduct

       business in Indiana as either a foreign business or a collection agency.” Id.

       However, “‘securing or collecting debts or enforcing mortgages and security

       interests in property securing the debts’” does not constitute transacting

       business in the State of Indiana. Id. (quoting Ind. Code § 23-1-49-2(b)(8)).

       Therefore, we held that the “Francises have failed to establish that EMC cannot

       enforce its rights pursuant to the Loan Documents.” Id.

[12]   The doctrine of res judicata bars the Francises’ latest attempt to raise these same

       arguments. Res judicata serves to prevent repetitious litigation of disputes that

       are essentially the same. Hilliard v. Jacobs, 957 N.E.2d 1043, 1046 (Ind. Ct. App.

       2011) (citing MicroVote General Corp. v. Ind. Election Comm'n, 924 N.E.2d 184,

       191 (Ind. Ct. App. 2010)), trans. denied. The doctrine of res judicata has two

       distinct components: claim preclusion and issue preclusion.1 Id. (citing Dawson

       v. Estate of Ott, 796 N.E.2d 1190, 1195 (Ind. Ct. App. 2003)). “Claim preclusion

       applies where a final judgment on the merits has been rendered which acts as a

       complete bar to a subsequent action on the same issue or claim between those

       1
         “Issue preclusion, also referred to as collateral estoppel, bars the subsequent relitigation of the same fact or
       issue where the fact or issue was necessarily adjudicated in a former suit and the same fact or issue is
       presented in a subsequent action.” Dev. Servs. Alternatives, Inc. v. Ind. Family & Soc. Servs. Admin., 915 N.E.2d
       169, 179 (Ind. Ct. App. 2009) (quoting In re Adoption of Baby W., 796 N.E.2d 364, 373 (Ind. Ct. App. 2003),
       trans. denied), trans. denied.

       Court of Appeals of Indiana | Memorandum Decision 18A-CT-8 | November 26, 2018                        Page 7 of 11
       parties and their privies.” Dev. Servs. Alternatives, Inc. v. Ind. Family & Soc. Servs.

       Admin., 915 N.E.2d 169, 179 (Ind. Ct. App. 2009) (quoting In re Adoption of

       Baby W., 796 N.E.2d 364, 373 (Ind. Ct. App. 2003), trans. denied), trans. denied.

                 The following four requirements must be satisfied for claim
                 preclusion to apply as a bar to a subsequent action: (1) the former
                 judgment must have been rendered by a court of competent
                 jurisdiction; (2) the former judgment must have been rendered on
                 the merits; (3) the matter now in issue was, or could have been,
                 determined in the prior action; and (4) the controversy
                 adjudicated in the former action must have been between the
                 parties to the present suit or their privies.

       Angelopoulos v. Angelopoulos, 2 N.E.3d 688, 696 (Ind. Ct. App. 2013), trans.

       denied.

[13]   The Francises’ claims in these proceedings are all related to the 2016 judgment

       of foreclosure, a judgment rendered on the merits, which was issued in Marion

       Superior Court and involved the same parties. The judgment was affirmed on

       appeal, and in their current appellants’ brief, the Francises are attempting to

       rehash the same arguments that our court addressed in that prior appeal. See

       Francis, No. 49A02-1604-MF-830, slip op. at 2–4. Therefore, claim preclusion

       applies, and the Francises are barred from relitigating the claims they raised in

       the trial court and in this appeal.

       Court of Appeals of Indiana | Memorandum Decision 18A-CT-8 | November 26, 2018   Page 8 of 11
[14]   Moreover, throughout their brief, the Francises make specious claims and fail

       to cite to the record or provide cogent reasoning in support of their claims.2 See

       e.g. Appellants’ Br. at 37 (stating that “[a]lleged counsels for defunct EMC

       Mortgage LLC, may have committed Fair Debt Collection Practice Act [] 15

       U.S.C. §1692(e) violations against Francis that include a misleading and

       confusing description of the amount of the debt”); id. at 47 (claiming that “[t]he

       collection counsels may be in violation of the Indiana Criminal Code, Corrupt

       Business Influence statute IC 35-46-6-1”); id. at 48 (arguing that “[t]he Trial

       Court erred in allowing debt collection counsel to withhold exculpatory

       evidence documents repeatedly without the threat of being sanctioned”).

[15]   Indiana Appellate Rule 46(A)(8)(a) provides that the party’s argument must

       “contain the contentions of the appellant on the issues presented, supported by

       cogent reasoning. Each contention must be supported by citations to the

       authorities, statutes, and the Appendix or parts of the Record on Appeal relied

       on[.]” The Francises’ failure to comply with the foregoing waives their issues

       for appellate review. See Dickes v. Feiger, 981 N.E.2d 559, 562 (Ind. Ct. App.

       2012); see also Thacker v. Wentzel, 797 N.E.2d 342, 345 (Ind. Ct. App. 2003)

       (clarifying that we will not become an advocate for a party and will not address

       2
        The Francises also argue that the “trial court erred by prejudicing Francis’[s] right to file Appeals by not
       giving timely notice of Completion, discovered by Francis only by accident.” Appellants’ Br. at 49. Because
       they were able to appeal the judgment, we are unable to fathom how the Francises’ right to appeal was
       “prejudiced.”

       Court of Appeals of Indiana | Memorandum Decision 18A-CT-8 | November 26, 2018                    Page 9 of 11
       arguments that are inappropriate, too poorly developed, or so improperly

       expressed that they cannot be understood).

[16]   Finally, EMC argues that the Francises are vexatious litigants and should be

       sanctioned. Our courts may sanction abusive litigants because the state has a

       legitimate interest in the preservation of valuable judicial and administrative

       resources. Zavodnik, 17 N.E.3d at 264. Our supreme court has made clear that

       “[t]he courts of this state, after due consideration of an abusive litigant’s entire

       history, may fashion and impose reasonable conditions and restrictions . . . on

       the litigant’s ability to commence or continue actions in this state that are

       tailored to the litigant’s particular abusive practices.” Id. at 266. In Zavodnik,

       our supreme court listed certain restrictions courts may place on abusive

       litigants. Id. at 268–69. The court also observed that courts may award attorney

       fees to prevailing parties and assess damages and other sanctions to parties who

       engage in abusive tactics. Id. at 264–65.

[17]   This appeal stems from the Francises’ second attempt to challenge the

       foreclosure of their property in state court.3 The Francises have also attempted

       to challenge the lender’s right to foreclose on their property in bankruptcy

       proceedings in the United States District Court for the Southern District of

       Indiana.

       3
        As we noted in footnote 2, the Francises also filed a separate appeal of the Marion Superior Court’s
       dismissal of their most recent complaint against Defendant PNC Bank in Francis, et al. v. Accubanc Mortgage
       Corporation, No. 18A-CT-596.

       Court of Appeals of Indiana | Memorandum Decision 18A-CT-8 | November 26, 2018                  Page 10 of 11
[18]   The Francises initiated these proceedings after receiving a forensic accounting

       of their mortgage, and they believed that the accounting supported their claims

       that the trial court erred when it entered a judgment in favor of EMC Mortgage.

       See Appellees’ App. pp. 77–99. For this reason, we decline to sanction the

       Francises. However, in the future, a trial court would be well within its

       discretion to impose sanctions on the Francises should they continue to

       challenge the valid foreclosure of their former real estate.

                                                 Conclusion
[19]   Concluding that the Francises are barred from raising the claims they have

       raised in these proceedings under the doctrine of res judicata, we affirm the

       dismissal of their complaint.

[20]   Affirmed.

       Bailey, J., and Bradford, J., concur.

       Court of Appeals of Indiana | Memorandum Decision 18A-CT-8 | November 26, 2018   Page 11 of 11