Court Opinion

ID: 9898014
Source: CourtListenerOpinion
Date Created: 2023-11-14 19:27:49.152133+00
Date Added: 2024-06-11T09:16:09.002351
License: Public Domain

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                                                                         FILED
                                                                      MARCH 28, 2023
                                                                In the Office of the Clerk of Court
                                                               WA State Court of Appeals, Division III

                 IN THE COURT OF APPEALS OF THE STATE OF WASHINGTON
                                    DIVISION THREE

       MICHELLE E. LOUN,                             )
                                                     )         No. 38769-1-III
                            Respondent,              )
                                                     )
                     v.                              )
                                                     )
       U.S. BANK NATIONAL                            )         PUBLISHED OPINION
       ASSOCIATION, AS INDENTURE                     )
       TRUSTEE ON BEHALF OF AND WITH                 )
       RESPECT TO AJAX MORTGAGE                      )
       LOAN TRUST 2018-B, MORTGAGE-                  )
       BACKED NOTES, its successors-in-              )
       interest and/or assigns,                      )
                                                     )
                            Appellant.               )

              LAWRENCE-BERREY, J. — In 2014 and again in 2017, U.S. Bank National

       Association’s (U.S. Bank’s) predecessor instituted two deed of trust judicial foreclosure

       actions against Michelle Loun. Both actions were involuntarily dismissed. After

       dismissal of the first action and for several months thereafter, Ms. Loun received monthly

       mortgage statements showing that the current balance did not include the accelerated

       amount.

              In 2020, Ms. Loun filed this quiet title action against U.S. Bank, requesting that

       the deed of trust be declared void because the six-year statute of limitations had run on
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       No. 38769-1-III
       Loun v. U.S. Bank Nat’l Ass’n

       the underlying debt. U.S. Bank brought a separate deed of trust judicial foreclosure

       action against Ms. Loun. The trial court consolidated both actions and later granted Ms.

       Loun’s summary judgment motion on her quiet title claim.

              This appeal requires us to consider if acceleration occurred, what the standard of

       proof is to reverse an election to accelerate,1 whether summary judgment was properly

       granted, and to what extent, if any, the six-year statute of limitations was tolled. We

       conclude that the prior judicial foreclosure actions accelerated the debt, a preponderance

       of evidence is required to establish that acceleration was revoked, the evidence presented

       by U.S. Bank allows reasonable minds to conclude that acceleration was revoked, and the

       prior judicial foreclosure actions did not toll the statute of limitations. We reverse the

       trial court’s summary judgment order, deny the parties their premature requests for

       attorney fees and costs on appeal, and remand for further proceedings.

              1
                Courts and commentators use different terms to describe the concept of reversing
       an election to accelerate. New York courts use the term “de-acceleration.” See, e.g.,
       Milone v. U.S. Bank NA, 164 A.D.3d 145, 83 N.Y.S.3d 524 (2018). Others use the term
       “deceleration.” See ANDREW J. BERNHARD, Deceleration: Restarting the Expired Statute
       of Limitations in Mortgage Foreclosures, 88 FLA. B.J. 30, 31 (2014). Still others use
       terms like “waiver” and “abandonment.” Technically, to “decelerate” means to slow
       down, as opposed to undoing or revoking the exercise of a right. See WEBSTER’S THIRD
       NEW INTERNATIONAL DICTIONARY 584 (1993). “Waiver” and “abandonment” suggest a
       choice to not exercise a right. See Bowman v. Webster, 44 Wn.2d 667, 669, 269 P.2d 960
       (1954) (waiver); In re Est. of Lyman, 7 Wn. App. 945, 948-49, 503 P.2d 1127 (1972)
       (abandonment). We believe that “revoking acceleration” most accurately describes the
       concept.

                                                     2
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       No. 38769-1-III
       Loun v. U.S. Bank Nat’l Ass’n

                                                 FACTS

               In 2006, Ms. Loun borrowed $399,900 from Bank of America to purchase

       residential property in Ellensburg. The debt was solemnized by an adjustable rate note

       that required monthly payments and was secured by a deed of trust against the property.

       Ms. Loun last paid on the note in February 2012 and has been in default since March

       2012.

               Paragraph 22 of the deed of trust sets forth the lender’s remedies upon the

       borrower’s default. Those remedies include the lender’s right to declare the balance

       accelerated and the borrower’s right to reinstate after acceleration.

               In May 2014, Bank of America, NA, initiated the first judicial foreclosure action.

       The complaint, in relevant part, read: “[T]he Borrower’s loan is in default. Because of

       the default, Plaintiff has exercised and hereby exercises the option granted in the Note

       and Deed of Trust to declare the whole of the balance of both the principal and interest

       thereon due and payable.” Clerk’s Papers (CP) at 973. Bank of America assigned the

       note and deed of trust to the Federal National Mortgage Association, commonly known

       as Fannie Mae, which then assigned the instruments to MTGLQ Investors, LP. In

       July 2016, the trial court dismissed the foreclosure action for want of prosecution.

               From July 19, 2016 until January 19, 2017, Bank of America’s loan servicer sent

       monthly mortgage statements to Ms. Loun reflecting the balance owing on the loan. The

       balance consistently reflected the past unpaid amount, the current monthly payment, and

                                                     3
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       No. 38769-1-III
       Loun v. U.S. Bank Nat’l Ass’n

       fees and charges. None of these monthly mortgage statements requested payment of any

       accelerated amount.

              After the September 2016 monthly statement, Ms. Loun’s attorney e-mailed the

       loan servicer, asking for all documents and information about the loan. Consistent with

       its monthly statements, the loan servicer’s response described the loan’s maturity date as

       May 1, 2046, which clearly implied that acceleration had been revoked.2

              In October 2017, MTGLQ initiated the second judicial foreclosure action. Similar

       to the earlier complaint, the second complaint notified Ms. Loun of the lender’s election

       to accelerate the loan. While the second action was pending, U.S. Bank acquired the note

       and deed of trust from MTGLQ. In May 2019, the trial court—for procedural reasons—

       granted Ms. Loun’s motion to strike MTGLQ’s complaint. U.S. Bank did not file an

       amended complaint.

              In October 2020, Ms. Loun filed a quiet title action against U.S. Bank, alleging

       that the six-year statute of limitations had run on any legal right for U.S. Bank to

       foreclose on the deed of trust. Days later, U.S. Bank filed a third judicial foreclosure

       action against Ms. Loun. The trial court consolidated both actions.

              2
               We question the loan servicer’s description of a May 1, 2046 maturity date. The
       adjustable rate note expressly states that the maturity date is March 1, 2036, even if
       amounts are still owed.

                                                     4
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       No. 38769-1-III
       Loun v. U.S. Bank Nat’l Ass’n

              Ms. Loun moved for summary judgment dismissal of U.S. Bank’s foreclosure

       action on the basis that collection of the debt secured by the deed of trust was time

       barred. U.S. Bank raised numerous arguments. It argued that the 2014 acceleration of

       the loan was revoked, waived, or abandoned, that the subsequent judicial foreclosures

       revoked any and all prior accelerations and started a new limitations period, and that the

       prior judicial foreclosure actions tolled the statute of limitations. The trial court

       disagreed with all of U.S. Bank’s arguments and granted Ms. Loun’s motion.

              U.S. Bank timely moved for reconsideration and argued that the prior foreclosure

       actions never accelerated the debt. The trial court denied U.S. Bank’s motion, and the

       bank timely appealed.

                                                ANALYSIS

              STANDARD OF REVIEW

              We review summary judgment orders de novo, engaging in the same inquiry as the

       trial court. SentinelC3, Inc. v. Hunt, 181 Wn.2d 127, 140, 331 P.3d 40 (2014). When

       ruling on a motion for summary judgment, a court views the facts submitted and the

       reasonable inferences that may be drawn from those facts in the light most favorable to

       the nonmoving party. Id. A court may grant a motion for summary judgment if

       reasonable minds could reach only one conclusion from the facts submitted. Id.

                                                      5
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       No. 38769-1-III
       Loun v. U.S. Bank Nat’l Ass’n

              This case presents us with an opportunity to address acceleration of a debt,

       revocation of acceleration, and under what circumstances collection of the debt is barred

       by the statute of limitations.

              ACCELERATION

              An action on a written contract is subject to the six-year statute of limitations.

       RCW 4.16.040(1). When a contract, such as a promissory note, calls for installment

       payments, “the statute of limitations runs against each installment from the time it

       becomes due; that is, from the time when an action might be brought to recover it.”

       Herzog v. Herzog, 23 Wn.2d 382, 388, 161 P.2d 142 (1945).

              Acceleration of a debt upon the borrower’s default is a benefit to the lender that

       causes the entire balance of the loan to become due and payable. Merceri v. Bank of N.Y.

       Mellon, 4 Wn. App. 2d 755, 760-61, 434 P.3d 84 (2018); accord Matthew B. Nevola,

       Foreclosure Madness: Using Mortgage Deceleration to Evade the Statute of Limitations,

       46 HOFSTRA L. REV. 1453, 1468 (2018). However, when a debt is accelerated, the statute

       of limitations on the entire balance begins to accrue. 4518 S. 256th, LLC v. Karen L.

       Gibbon, PS, 195 Wn. App. 423, 434-35, 382 P.3d 1 (2016). If the statute of limitations

       precludes enforcement of the note and deed of trust, a property owner can file a quiet title

       action seeking to have the encumbrance removed from the title. See RCW 7.28.300.

              Washington cases hold that acceleration of an installment note must be made in a

       clear and unequivocal manner that effectively apprises the maker that the holder has

                                                     6
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       No. 38769-1-III
       Loun v. U.S. Bank Nat’l Ass’n

       exercised his right to accelerate the installment debt. 4518 S. 256th, 195 Wn. App. at

       435; Glassmaker v. Ricard, 23 Wn. App. 35, 38, 593 P.2d 179 (1979).

              U.S. Bank contends the loan was never accelerated because Ms. Loun retained the

       right to reinstate the loan. U.S. Bank cites our recent decision of U.S. Bank National

       Association v. Ukpoma, 8 Wn. App. 2d 254, 438 P.3d 141 (2019). There, the lender gave

       notice to the borrower of her default and of its election to accelerate, but the lender also

       stated that the borrower could reinstate the loan by paying the current balance, late

       charges, costs, and fees. Id. at 256-57. We concluded that acceleration did not occur

       because the notice was ambiguous and inconsistent. Id. at 259. Judge Siddoway

       disagreed with this holding, but concurred on the basis that the statute of limitations had

       not run on the underlying debt. Id. at 261-66 (Siddoway, J., concurring in part and

       dissenting in part).

              We believe that Ukpoma wrongly decided the acceleration issue. As noted in

       Ukpoma, the borrower’s right to reinstate after acceleration, but prior to a trustee’s sale,

       was protected both by contract and by statute. Id. at 257 n.1. To the extent the lender’s

       right to accelerate was qualified by the borrower’s right to reinstate, the lender exercised

       its right as clearly and broadly as it could. We conclude that U.S. Bank’s predecessor

       clearly and unequivocally elected to accelerate the debt, notwithstanding that the deed of

       trust contained a right for Ms. Loun to reinstate after acceleration.

                                                     7
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       No. 38769-1-III
       Loun v. U.S. Bank Nat’l Ass’n

              REVOCATION OF ACCELERATION

                       Standard of proof

              The parties dispute whether U.S. Bank must prove revocation of acceleration by a

       preponderance of the evidence or by clear and unequivocal evidence. To answer this

       question, we review why courts apply different standards of proof.

              The evidentiary standard to be applied to a particular claim is “based upon the

       nature of the interest at stake—the interest which is subject to erroneous deprivation if a

       mistake is made.” Bang D. Nguyen v. Dep’t of Health Med. Quality Assurance Comm’n,

       144 Wn.2d 516, 524, 29 P.3d 689 (2001). The applicable evidentiary standard reflects

       “‘the degree of confidence our society thinks [the fact finder] should have in the

       correctness of factual conclusions for a particular type of adjudication.’” Id. (internal

       quotation marks omitted) (quoting Addington v. Texas, 441 U.S. 418, 423, 99 S. Ct. 1804,

       60 L. Ed. 2d 323 (1979)). Thus, the more important the decision, the higher the standard

       of proof. Id.

              In general, the lowest standard, preponderance of the evidence, applies to civil

       actions, because society has a minimal interest in the outcome of private disputes. Id.

       The highest standard is beyond a reasonable doubt, in which the accused and society’s

       interests in avoiding wrongful convictions are so great that the standard of proof is

       designed to exclude as nearly as possible the likelihood of an erroneous judgment. Id.

                                                    8
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       No. 38769-1-III
       Loun v. U.S. Bank Nat’l Ass’n

              “When the interests at stake in a lawsuit are more significant than a money

       judgment but less consequential than a deprivation of individual liberty, courts must

       apply an intermediate evidentiary standard that requires ‘clear, cogent, unequivocal,

       and/or convincing’ proof.” In re Custody of C.C.M., 149 Wn. App. 184, 203, 202 P.3d

       971 (2009) (internal quotation marks omitted) (quoting Nguyen, 144 Wn.2d at 524-25).

       In C.C.M., we held that the clear and convincing evidentiary standard applied to

       decisions that risked erroneously depriving parents of their constitutionally protected

       rights to the custody, care, and control of their children. Id. at 203-05.

              Here, this is a private dispute about whether a debt is owed by Ms. Loun to

       U.S. Bank. A conclusion that acceleration was revoked preserves the lender’s contractual

       remedy against its borrower, who has breached her promise to repay. Given this, we

       conclude that the preponderance of the evidence standard is appropriate for determining

       whether the acceleration has been revoked.

                     Whether revocation occurred is a question of fact

              We next must decide whether reasonable minds can find that acceleration was

       revoked. As mentioned previously, when reviewing whether summary judgment was

       properly granted, we construe the evidence and all reasonable inferences in favor of the

       nonmoving party. SentinelC3, 181 Wn.2d at 140. In this instance, the evidence and all

       reasonable inferences must be construed in favor of U.S. Bank.

                                                     9
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       No. 38769-1-III
       Loun v. U.S. Bank Nat’l Ass’n

              Ms. Loun argues that U.S. Bank should not be allowed to revoke acceleration

       because the deed of trust does not allow for it to do so. Ms. Loun cites PNC Bank, NA v.

       Unknown Successor Trustees of the Robert C. Keck Revocable Living Trust, 2020

       OK Civ. App. 60, 479 P.3d 238, as persuasive authority for her position that revocation

       of acceleration should be allowed only if the parties’ contract expressly authorizes it.

       PNC Bank did not cite any authority for this holding and its holding has not been cited

       with approval by any other jurisdiction.

              Other courts have reached a different conclusion. For example, in Freedom

       Mortgage Corporation v. Engel, 37 N.Y.3d 1, 28-29, 169 N.E.3d 912, 146 N.Y.S.3d 542

       (2021), New York’s highest court held that absent a specific provision in the contract

       governing revocation of acceleration, “revocation can be accomplished by an ‘affirmative

       act’ of the noteholder within six years of the election to accelerate.” Allowing lenders to

       revoke acceleration—even in the absence of an express provision in the contract—

       benefits both lenders and borrowers. It benefits lenders by giving them more flexible

       remedies. It benefits borrowers by allowing them to cure a default without paying the

       entire balance of the loan. For this reason, we adopt the rule in Engel.

              Therefore, the dispositive question is whether reasonable minds can find that

       U.S. Bank’s predecessor affirmatively revoked acceleration within six years of May

                                                    10
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       No. 38769-1-III
       Loun v. U.S. Bank Nat’l Ass’n

       2014, when it first accelerated the loan.3 As explained below, reasonable minds can so

       find.

               Here, Bank of America accelerated the loan when it initiated the first judicial

       foreclosure action in May 2014. Soon after that action was dismissed in July 2016, the

       loan servicer sent seven monthly statements to Ms. Loun notifying her that the balance of

       her loan did not include any accelerated amounts. In addition, in October 2016, the loan

       servicer responded to Ms. Loun’s request for information by describing the loan as

       having a maturity date three decades in the future. For these reasons, reasonable minds

       can find that U.S. Bank’s predecessor affirmatively revoked acceleration within six years

       of 2014 and the six-year statute has not run on the entire obligation. We conclude the

       trial court erred in granting summary judgment in favor of Ms. Loun.

               TOLLING

               In the interest of judicial economy, an appellate court may consider an issue that is

       likely to occur following remand if the parties have briefed and argued the issue in detail.

       State ex rel. Haskell v. Spokane County Dist. Ct., 198 Wn.2d 1, 16, 491 P.3d 119 (2021).

       Both below and on appeal, the parties briefed the issue of tolling. Judicial economy

       favors resolving the issue now rather than in a later appeal.

               3
                The second acceleration occurred in October 2017, three years before the parties
       initiated this current claim and counterclaim. The six-year statute of limitations therefore
       has not run with respect to the second acceleration.

                                                    11
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       No. 38769-1-III
       Loun v. U.S. Bank Nat’l Ass’n

              RCW 4.16.230 provides, “When the commencement of an action is stayed by

       injunction or a statutory prohibition, the time of the continuance of the injunction or

       prohibition shall not be a part of the time limited for the commencement of the action.”

                     Bankruptcy tolls the statute of limitations

              There is some evidence in the record that Ms. Loun may have been in bankruptcy

       sometime between 2014 and 2020. See, e.g., CP at 1145. 11 U.S.C. § 362(a)

       automatically stays all proceedings against a debtor. If Ms. Loun was in bankruptcy

       anytime within six years of when U.S. Bank commenced its action, the statute of

       limitations would be tolled to that extent.

                     Judicial foreclosure actions do not toll the statute of limitations

              Without citing any direct authority, U.S. Bank contends that the two judicial

       foreclosure actions tolled the statute of limitations. We disagree.

              U.S. Bank fails to provide any evidence that an injunction or statutory

       prohibition “stayed” its ability to commence an action to recover the unpaid amounts.

       RCW 4.16.230. Certainly, its predecessor’s judicial foreclosure actions did not stay its

       ability to recover the unpaid debt. A judicial foreclosure action is an action to collect an

                                                     12
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       No. 38769-1-III
       Loun v. U.S. Bank Nat’l Ass’n

       unpaid debt. We conclude that the judicial foreclosure actions did not toll the statute of

       limitations.4

              ATTORNEY FEES AND COSTS

              Both parties request an award of reasonable attorney fees and costs on appeal.

       They cite paragraph 7(E) of the note, and paragraph 26 of the deed of trust. The former

       authorizes the lender to recover all costs and expenses to recover the accelerated amount,

       and the latter authorizes the lender to recover its reasonable attorney fees and costs in any

       action to enforce the security instrument. RCW 4.84.330 modifies unilateral attorney fee

       provisions in contracts so that only the prevailing party is entitled to recover reasonable

       attorney fees and costs, whether or not that party is specified in the contract as entitled to

       fees.5 Wash. Fed. v. Gentry, 179 Wn. App. 470, 496, 319 P.3d 823 (2014).

              4
                 In Bingham v. Lechner, 111 Wn. App. 118, 131, 45 P.3d 562 (2002), the trial
       court found, and on appeal the parties agreed, that commencement of a nonjudicial
       foreclosure tolls the statute of limitations. The appellate court did not analyze this issue.
       To the extent Bingham agreed with the trial court, we disapprove of its conclusion
       because Bingham fails to identify any statute that stays or enjoins the ability of a deed of
       trust beneficiary from commencing an action to recover the debt.
               RCW 61.24.030(4) certainly does not stay or enjoin recovery of the debt. That
       subsection precludes a trustee’s sale if there is a pending action by the deed of trust
       beneficiary to collect the unpaid debt. This preclusion is not a stay or an injunction from
       recovering the debt; rather, it is a prohibition against concurrent attempts to collect the
       same debt.
               5
                 We suspect that most of the “fees and charges” reflected in the monthly
       mortgage statements are attorney fees and costs incurred by U.S. Bank’s predecessor in
       the two unsuccessful foreclosures. If so, because the predecessor did not prevail in those
       actions, we doubt U.S. Bank can recover those amounts.

                                                     13
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       No. 38769-1-III
       Lounv. US. BankNat'lAss'n

              The above provisions will entitle the prevailing party to reasonable attorney fees

       and costs, both at trial and on appeal. But neither party has yet prevailed. For this

       reason, we decline to award either party reasonable attorney fees and costs on appeal.

              We authorize the trial court to include in its judgment an award of reasonable

       attorney fees and costs to the prevailing party for this appeal. But because Ms. Loun did

       not ultimately prevail on her summary judgment motion, her reasonable attorney fees and

       costs for litigating these issues should be discounted. See Bowers v. Transamerica Title

       Ins. Co., 100 Wn.2d 581, 597, 675 P.2d 193 (1983) ("The court must limit the lodestar to

       hours reasonably expended, and should therefore discount hours spent on unsuccessful

       claims, duplicated effort, or otherwise unproductive time.").

             Reversed and remanded.

       WE CONCUR:

                                                         Staab, J.

                                                    14
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                                             No. 38769-1-111

              SIDDOWAY, CJ. (concurring)-Michelle Loun's deed oftrust states that in the

       event of her failure to cure a default on or before the date provided in a proper notice,

       "Lender at its option, may require immediate payment in full of all sums secured by this

       Security Instrument without further demand." Clerk's Papers (CP) at 26 (emphasis

       added). As explained by the lead opinion, since acceleration is optional with the lender,

       the lender can revoke it unless the borrower has detrimentally relied.

              Ms. Loun argues that Washington requires "clear and unequivocal evidence" of

       acceleration of a promissory note and "[i]t would be inconsistent to apply one standard to

       trigger acceleration and a different, lower standard to revoke it." Resp't's Br. at 2

       (emphasis added). Amicus curiae characterizes Washington cases as holding that

       acceleration requires "' clear and unequivocal' notice to a debtor" and, similar to Ms.

       Loun, argues that consistency requires that notice of revoking acceleration be clear and

       unequivocal. Amicus Br. ofNw. Consumer L. Ctr. at 5 (emphasis added). I write

       separately to address "clear and unequivocal" as a characteristic of the act of acceleration

       rather than the standard of proof.

              Symmetry for symmetry's sake is not a reason for holding that a lender must

       revoke acceleration by clear and unequivocal notice. We do not lightly impose special

       burdens on one party to a contract. The question to be examined is whether the reasons

       Washington courts have required acceleration to be clear and unequivocal supports
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       No. 38769-1-111 (concurrence)
       Loun v. US. Bank Nat'! Ass 'n

       requiring that the lender be clear and unequivocal when it revokes acceleration. Not only

       do the historical reasons not support this proposed requirement, but where, as here, the

       mortgage is a standard form Fannie Mae/Freddie Mac mortgage, there is no longer any

       borrower-protective need for acceleration itself to be clear and unequivocal.

              Washington cases have historically offered two reasons for requiring that a lender

       exercise its right to accelerate affirmatively, or clearly and unequivocally. One protects

       the lender; the other protects the buyer. The earliest cases address the reason that protects

       the lender.

       I.     PROTECTING LENDERS: BORROWERS SHOULD BE PREVENTED FROM ARGUING
              THAT A LENDER'S RIGHT TO REPAYMENT IS ENTIRELY TIME BARRED BASED ON
              EQUIVOCAL EVIDENCE OF ACCELERATION

              In First National Bank ofSnohomish v. Parker, 28 Wash. 234, 68 P. 756 (1902), a

       borrower/mortgagor defended against foreclosure by arguing that a provision in the

       mortgage provided that upon default of payment of interest when due the right of

       foreclosure accrued immediately-and since its default had occurred more than six years

       before commencement of the action, foreclosure was time barred. The court observed

       that the general rule is that the default "must be claimed by the mortgagee, or it is waived.

       It is for the benefit of the mortgagee, and cannot be taken advantage of by the

       mortgagor." Id. at 237 (emphasis added).

              The principle was the basis for rejecting a similar statute of limitations defense in

       White v. Krutz, 37 Wash. 34, 36, 79 P. 495 (1905). In that case, the borrowers had

                                                     2
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       No. 38769-1-111 (concurrence)
       Loun v. US. Bank Nat'/ Ass 'n

       promised on January 1, 1895, to pay interest semiannually, but never did. The parties'

       agreement provided that upon a default in payment "the indebtedness ... should

       immediately become due and payable, without notice." Id. at 35. In an action

       commenced more than six years after the first default in payment, the court again held

       that since the provision was for the mortgagee's benefit, it could be waived by him and

       could not be taken advantage ofby the mortgagor. Id. at 36.

       II.    PROTECTING BORROWERS: THE REQUIREMENT OF AN AFFIRMATIVE ACT OF
              ACCELERATION PROVIDES A BRIGHT LINE FOR THE TIME WITHIN WHICH A
              BORROWER MAY CURE A DEFAULT

              In other early cases, the requirement that the lender take an affirmative act to

       accelerate was applied to protect the borrower/mortgagor. In Zeimantz v. Blake,

       39 Wash. 6, 10, 80 P. 822 (1905), it was said that "time was made of the essence of the

       [parties'] contract, and a forfeiture occurred as of course on default of any payment," yet

       the court held that to avoid foreclosure, the mortgagor was not required to prove a history

       of timely payments. It held, "Undoubtedly the party agreeing to make the sale could

       declare a forfeiture, and cut off the right of the other party to make the payments, but it

       required some affirmative action on his part. If he remained passive until the other party

       made tender of payment, he was obligated to accept it." Id. at 10 (emphasis added).

              The same reasoning was applied in Weinberg v. Naher, which held that just as a

       right to accelerate that is not exercised will not start the running of the statute of

       limitations, it will not "' of itself, forfeit the contract in equity simply because a payment

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       No. 38769-1-111 (concurrence)
       Loun v. US. Bank Nat'! Ass 'n

       was not made immediately on its falling due."' 51 Wash. 591, 596-97, 99 P. 736 (1909)

       (quoting Zeimantz, 39 Wash. at 10). Expanding on Zeimantz's requirement of "some

       affirmative action," the court explained that for the debt to become due:

              Some affirmative action is required, some action by which the holder of the
              note makes known to the payors that [he] intends to declare the whole debt
              due. This exercise of the option may of course take different forms. It may
              be exercised by giving the payors formal notice to the effect that the whole
              debt is declared to be due, or by the commencement of an action to recover
              the debt, or perhaps by any means by which it is clearly brought home to
              the payors of the note that the option has been exercised before the interest
              is paid or tendered.

       Id. at 594 (emphasis added).

              In Coman v. Peters, 52 Wash. 574, 576, 100 P. 1002 (1909), the borrower's tender

       of a payment of interest was late, yet "up to the moment the tender was made ... there

       had not been any notice, or even intimation ... to the payors ... that the interest money

       would be refused, or that it (payee) elected to declare the whole debt due." The payee's

       action to foreclose was therefore dismissed by the trial court on the ground that the debt

       had not matured. The Supreme Court affirmed and observed (having recounted the

       decisions in Parker, Zeimantz, and Weinberg) that "this court is fully committed to the

       doctrine ... that mere default in payment does not mature the whole debt, whether there

       be words of option in the agreement or not. Such a provision hastening the date of

       maturity of the whole debt is for the benefit of the payee, and if he does not manifest any

       intention to claim it, before tender is actually made, there is in law no default such as will

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       No. 38769-1-III (concurrence)
       Loun v. US. Bank Nat'/ Ass'n

       cause the maturity of the debt before the regular time provided in the agreement." Id. at

       578 (emphasis added).

              It was not until 1979 that this court, not the Supreme Court, adopted the "clear and

       unequivocal manner" descriptor. In Glassmaker v. Ricard, this court stated that

       acceleration "must be made in a clear and unequivocal manner which effectively apprises

       the maker that the holder has exercised his right to accelerate the payment date." 23 Wn.

       App. 35, 38, 593 P.2d 179 (1979). Glassmaker cites Weinberg for the proposition,

       evidently relying on the Supreme Court's statements in Weinberg that "affirmative

       action" is required "by which the holder of the note makes known to the pay ors that [he]

       intends to declare the whole debt due," and by which "it is clearly brought home to the

       payors of the note that the option has been exercised." Weinberg, 51 Wash. at 594.

              As with Parker, Zeimantz, and Weinberg, Glassmaker's "clear and unequivocal"

       standard was relied on to determine whether the lender's exercise of the acceleration right

       was sufficiently clear to cut off the borrower's ability to cure. Glass maker held that the

       mere filing of a foreclosure complaint without serving it on the mortgagor was not

       sufficiently clear notice. 23 Wn. App. at 3 8.

             Notably, decisions following Glassmaker that have applied the "clear and

       unequivocal" standard have not done so for the borrower-protective reason-they have

       consistently done so for the lender-protective reason. This is presumably because under

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       No. 38769-1-111 (concurrence)
       Loun v. US. Bank Nat'! Ass 'n

       modem uniform residential mortgages, borrowers no longer need the protection provided

       by requiring that acceleration be clear and unequivocal. 1

       Ill.   REINSTATEMENT RIGHTS UNDER MODERN UNIFORM RESIDENTIAL MORTGAGES
              HA VE ELIMINATED THE IMPORTANCE OF CLARITY AS A PROTECTION FOR THE
              BORROWER

              Reinstatement rights under modem uniform residential mortgages have eliminated

       the importance of clear and unequivocal acceleration as a protection for the buyer. The

       deed of trust executed by Michelle Loun in 2006 is a uniform mortgage instrument

       developed by the Federal National Mortgage Association (Fannie Mae) and Federal

       Home Loan Mortgage Corporation (Freddie Mac). Fannie Mae and Freddie Mac are

       government-sponsored enterprises (GSEs) created by Congress to provide stability,

       liquidity, and affordability to the residential mortgage market. See 12 U.S.C. § 1716;

       12 u.s.c. § 1451.

              1
                The relevant post-1979 decisions cited by Ms. Loun and amicus apply the "clear
       and unequivocal" standard to protect a lender against a statute of limitations defense. In
       4518 S. 256th, LLC v. Karen L. Gibbon, PS, 195 Wn. App. 423, 435-38, 382 P.3d 1
       (2016), this court held that notices of default and trustee's sales that demanded payment
       of arrearages only, without stating that the lender was electing to declare the unpaid
       balance due, did not meet the "clear and unequivocal" standard for acceleration. In
       Merceri v. Bank ofNew York Mellon, 4 Wn. App. 2d 755, 761-62, 434 P.3d 84 (2018),
       this court held that a notice to a borrower that her entire debt"' will be accelerated'" if a
       default is not cured is not an effective clear and unequivocal acceleration. (Emphasis
       added.) Accord Terhune v. N Cascade Tr. Servs., Inc., 9 Wn. App. 2d 708, 723, 446
       P.3d 683 (2019) (a notice of intent to accelerate does not unequivocally alert the
       borrower that there has been an election to accelerate). As a result, none of the
       foreclosure actions in these cases was time barred.

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       No. 38769-1-111 (concurrence)
       Loun v. US. Bank Nat'/ Ass 'n

              Before 1970, little uniformity existed in home mortgage forms. After enactment

       of the Emergency Home Finance Act (Pub. L. No. 91-351, 84 Stat. 450) in July 1970,

       however, Fannie Mae created a task force to prepare a draft standard mortgage form.

       See Julia Patterson Forrester, Fannie Mae/Freddie Mac Uniform Mortgage Instruments:

       The Forgotten Benefit to Homeowners, 72 Mo. L. REV. 1077, 1083 (2007). In response

       to public input, Fannie Mae and Freddie Mac developed forms that were quite consumer

       friendly. Id. at 1084-85.

              The right to reinstate provision in Ms. Loun's deed of trust gives her the right,

       even after acceleration, to stop foreclosure and reinstate the loan by paying the amounts

       that would have been due absent acceleration plus the lender's expenses. The right exists

       up to the date of a court order of foreclosure or up to five days prior to a power of sale

       foreclosure. The provision states:

                     19. Borrower's Right to Reinstate After Acceleration. If
             Borrower meets certain conditions, Borrower shall have the right to have
             enforcement of this Security Instrument discontinued at any time prior to
             the earliest of: (a) five days before sale of the Property pursuant to any
             power of sale contained in this Security Instrument; (b) such other period as
             Applicable Law might specify for the termination of Borrower's right to
             reinstate; or (c) entry of a judgment enforcing this Security Instrument.
             Those conditions are that Borrower: (a) pays Lender all sums which then
             would be due under this Security Instrument and the Note as if no
             acceleration had occurred; (b) cures any default of any other covenants or
             agreements; (c) pays all expenses incurred in enforcing this Security
             Instrument, including, but not limited to, reasonable attorneys' fees,
             property inspection and valuation fees, and other fees incurred for the
             purpose of protecting Lender's interest in the Property and rights under this
             Security Instrument; and (d) takes such action as Lender may reasonably

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       No. 38769-1-111 (concurrence)
       Loun v. US. Bank Nat'/ Ass 'n

              require to assure that Lender's interest in the Property and rights under this
              Security Instrument, and Borrower's obligation to pay the sums secured by
              this Security Instrument, shall continue unchanged.

       CP at 25.

              Fannie Mae and Freddie Mac require that loans they purchase be documented on

       their forms, so originators who wish to sell their loans to Fannie Mae or Freddie Mac

       must use the instruments. Forrester, supra, at 1085. Even lenders who do not

       contemplate selling their loans to the GSEs typically use the forms, which have become

       the standard for loans sold on the secondary market. Id. As of the time of Professor

       Forrester's law review article, "[b]y some estimates, more than ninety percent of

       residential mortgage loans are documented on Fannie Mae/Freddie Mac uniform

       mortgage instruments, although this percentage may have decreased as the size of the

       subprime mortgage market has increased." Id. at 1086-87 (footnote omitted).

              The uniform residential mortgage signed by Ms. Loun affords her the right to

       bring her loan current to avoid foreclosure up until a final judgment of foreclosure. It is

       therefore unnecessary that there be a clear and unequivocal act of acceleration to demark

       the point at which that right is cut off by acceleration. Indeed, a Florida appellate court

       has observed that in the case of a borrower with Ms. Loun's form mortgage, the dismissal

       of a foreclosure action returns the parties to the status quo existing before acceleration,

       making it unnecessary for a lender to even take action to revoke acceleration. Deutsche

       Bank Tr. Co. Americas v. Beauvais, 188 So.3d 938, 947-48 (Fla. Dist. Ct. App. 2016).

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       No. 38769-1-111 (concurrence)
       Loun v. US. Bank Nat'! Ass 'n

       Here, of course, there is action; there are several years' worth of mortgage statements and

       loan descriptions disclosing that Ms. Loun's loan had been returned to the status quo.

             Ms. Loun demonstrates no reason we should require clear and unequivocal notice

       that acceleration has been revoked. A special burden of providing such notice should not

       be imposed on lenders.

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