Court Opinion

ID: 2759722
Source: CourtListenerOpinion
Date Created: 2014-12-11 17:00:55.802885+00
Date Added: 2024-06-11T08:49:47.274913
License: Public Domain

United States Court of Appeals
                             For the Eighth Circuit
                         ___________________________

                                 No. 13-2974
                         ___________________________

                                     Aaron I. Sari

                        lllllllllllllllllllll Plaintiff - Appellant

                                     Tracy A. Sari

                               lllllllllllllllllllll Plaintiff

                                             v.

                               Wells Fargo Bank, N.A.

                        lllllllllllllllllllll Defendant - Appellee
                                       ____________

                     Appeal from United States District Court
                    for the District of Minnesota - Minneapolis
                                   ____________

                             Submitted: October 8, 2014
                              Filed: December 11, 2014
                                   [Unpublished]
                                   ____________

Before MURPHY, SMITH, and GRUENDER, Circuit Judges.
                           ____________

PER CURIAM.

       Aaron Sari brought this action to void the foreclosure sale of his home, arguing
that the sale did not comply with a Minnesota statute that requires foreclosing parties
to record a notice with the county before publishing a foreclosure advertisement. The
district court1 granted summary judgment to defendant Wells Fargo Bank, pointing
out that in Badrawi v. Wells Fargo Home Mortgage, Inc. our court had examined the
same Minnesota statute and expressly foreclosed the argument Sari raised here. See
718 F.3d 756 (8th Cir. 2013). Sari appeals and we affirm.

       Sari obtained a mortgage loan from Wells Fargo and purchased a home in
Minnetonka, Minnesota. After he defaulted on his mortgage payments, Wells Fargo
began foreclosure proceedings by advertisement in September 2011. This procedure
allowed the bank to begin foreclosure by publishing a notice in a local newspaper
rather than by filing a judicial action. Wells Fargo served Sari with a notice of
foreclosure sale on September 22. It then published a notice of foreclosure sale in a
local business newspaper on September 24. Two days later the bank recorded notice
of the pendency of a foreclosure sale with the county. Sari's home was sold at a
sheriff's sale in January 2012.

       Sari brought an action in Minnesota state court to void the foreclosure sale,
asserting that Wells Fargo had not complied with Minn. Stat. § 580.032, subd. 3,
which requires foreclosing parties to "record a notice of the pendency of the
foreclosure . . . before the first date of publication of the foreclosure notice." After
successfully removing the case to federal court, Wells Fargo admitted that it had
violated that statutory provision but it argued that Badrawi foreclosed Sari's claim
since homeowners like him are "not among the class whose interests Minn. Stat. §
580.032, subd. 3 was enacted to protect." See 718 F.3d at 759. The district court
agreed and granted summary judgment to Wells Fargo.

      1
         The Honorable Ann D. Montgomery, United States District Judge for the
District of Minnesota.

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       We review the district court's grant of summary judgment de novo, viewing all
evidence and drawing all reasonable inferences in favor of the nonmoving party.
Stein v. Chase Home Fin., LLC, 662 F.3d 976, 979 (8th Cir. 2011). When "applying
Minnesota law under our diversity jurisdiction, we are bound by the decisions of the
Minnesota Supreme Court." Badrawi, 718 F.3d at 758.

       In Badrawi as here, the plaintiff challenged the foreclosure sale of her property
based on the bank's failure to record a notice of pendency with the county prior to
publishing a notice of foreclosure sale. Id. at 757. Relying on the Minnesota
Supreme Court's opinion in Holmes v. Crummett, 13 N.W. 924 (Minn. 1882), we
ruled in Badrawi that under Minnesota law a "homeowner may not set aside a
foreclosure based on an omission of some prescribed act which cannot have affected
him, and cannot have been prescribed for his benefit." Badrawi, 718 F.3d at 759.
Given that Minn. Stat. § 580.032, subd. 3 "is most sensibly read to protect the interest
of third parties who own a redeemable interest in mortgaged property which might
be jeopardized if the mortgagor foreclosed without notice," we concluded that
homeowners like Sari are "not among the class whose interests" that statute "was
enacted to protect." Id. We therefore dismissed the plaintiff's challenge to the
foreclosure sale.

       Sari argues for a different interpretation of Minn. Stat. § 580.032, subd. 3 and
moves for a certification to the Minnesota Supreme Court of the question of whether
homeowners have standing to challenge violations of that statutory provision. We
rejected Sari's interpretation in Badrawi. He has not identified any subsequent
opinions of our court or the Minnesota Supreme Court that limit the precedential
effect of Badrawi, and we are bound by our prior decision. See Brock v. Astrue, 674
F.3d 1062, 1065 (8th Cir. 2012). We deny Sari's motion for certification because we
are not uncertain about the question of state law he raises. See Johnson v. John Deere
Co., 935 F.2d 151, 153 (8th Cir. 1991). Given that Sari "is not among the class
whose interests Minn. Stat. § 580.032, subd. 3 was enacted to protect," the district

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court properly granted summary judgment to Wells Fargo. See Badrawi, 718 F.3d at
759.2

      For these reasons we affirm the judgment of the district court.

SMITH, Circuit Judge, concurring.

        I concur in the per curiam opinion based on circuit precedent. However, I write
separately to indicate that for the reasons discussed in my dissenting opinion in
Badrawi, I would find that the Minnesota Court of Appeals's decision in Ruiz v. 1st
Fidelity Loan Servicing, LLC, No. A11–1081, 2012 WL 762313 (Minn. Ct. App.
Mar. 12, 2012), is the best evidence of Minnesota law. Badrawi, 718 F.3d at 760–61
(Smith, J., dissenting). In Ruiz, the Minnesota Court of Appeals held that a
"foreclosure by advertisement is void [if it] fail[s] to strictly comply with section[]
. . . 580.032." 2012 WL 762313, at *5.

      My conclusion that "Ruiz is our best indicator of what the Minnesota Supreme
Court would do if it had chosen to address § 580.032," Badrawi, 718 F.3d at 761
(Smith, J., dissenting), is buttressed by the Minnesota Court of Appeals's post-
Badrawi decision in Woelfel v. U.S. Bank, National Ass'n, No. A13-2052, 2014 WL
3558141 (Minn. Ct. App. July 21, 2014). In that case, the Minnesota Court of
Appeals once again concluded that "[t]he plain language of Minn. Stat. § 580.032,
subd. 3, unambiguously requires that the pendency of the notice of foreclosure must
be recorded within a specified time period" and found that the Minnesota Supreme
Court's "recent opinions on chapter 580 indicate that a failure to strictly comply with

      2
       On his appeal, Sari also raised a new ground for standing based on contract
law. That argument is waived by having not been presented in the district court. See
Stone v. Harry, 364 F.3d 912, 914 (8th Cir. 2004).

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any statute in chapter 580 causes a foreclosure to be void." Id. at *3 (quotation and
citation omitted).

      Therefore, I would reverse the judgment of the district court if the question
presented were open in this circuit.
                      ______________________________

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