Court Opinion

ID: 3082267
Source: CourtListenerOpinion
Date Created: 2015-10-16 02:06:19.219663+00
Date Added: 2024-06-11T09:50:54.331868
License: Public Domain

In The
                      Court of Appeals
        Sixth Appellate District of Texas at Texarkana

                           No. 06-13-00003-CV

DEUTSCHE BANK TRUST COMPANY, N. A. A/K/A DEUTSCHE BANK NATIONAL
                    TRUST COMPANY, Appellant

                                     V.

          KENNETH W. HALL AND ROBERTA HALL, Appellees

              On Appeal from the 402nd Judicial District Court
                           Wood County, Texas
                         Trial Court No. 2012-474

                Before Morriss, C.J., Carter and Moseley, JJ.
                        Opinion by Justice Moseley
                                                OPINION
         Kenneth W. Hall and Roberta Hall brought suit against Deutsche Bank Trust Company,

N.A. a/k/a Deutsche Bank National Trust Company (Deutsche), the lienholder of the home

equity loan secured by their property. Among other things, the Halls claimed that the original

lender from whom Deutsche had been assigned the Halls’ note and lien had not followed the

procedures required by the Texas Constitution for a valid home equity loan and that Deutsche

had collected from the Halls—but had not paid—ad valorem taxes assessed against the secured

property. The Halls also claimed that the transaction was tainted by fraud. The Halls’ suit relied

on several bases for recovery, including the Deceptive Trade Practices Act (TEX. BUS. & COM.

CODE ANN. § 17.50 (West 2011)), common law fraud, and the Texas Declaratory Judgments Act

(TEX. CIV. PRAC. & REM. CODE ANN. §§ 37.001–.011 (West 2008)). 1 The Halls relied on

obtaining service of citation on CT Corporation Systems, Inc., Deutsche’s agent for service of

citation in Texas. After the United States Postal Service’s return receipt (“green card”) had been

returned to the District Clerk of Wood County and had been on file for the requisite period of

time without an answer having been filed by Deutsche, the Halls moved for the entry of a default

judgment. This default judgment was granted September 27, 2012. Deutsche filed a restricted

appeal January 14, 2013, and it argues the trial court erred in granting the default judgment. A

restricted appeal is a direct attack on a judgment. See PNS Stores, Inc. v. Rivera, 379 S.W.3d
267, 271 (Tex. 2012).

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 Interestingly, although the Halls sought a declaratory judgment that the home equity loan was sufficiently defective
that it did not operate to create a valid lien on the Halls’ home, there is no description of the realty contained in the
operative pleadings, and the default judgment describes the realty only by street address.

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       Deutsche maintains that the trial court’s alleged error in granting the default judgment is

apparent on the face of the record due to the following: (1) the clerk failed to execute the return

of service on the citation of the defendant, (2) the return of service fails to include the date and

time that the citation was received by the district clerk for service, (3) because the green card on

file bears no signature, service of citation was not accomplished by certified mail, and (4) there is

no indication that the person or entity receiving the citation via mail was the authorized agent for

service of process of Deutsche. Because the record affirmatively fails to reflect compliance with

Rules 16, 105, and 107 of the Texas Rules of Civil Procedure, we reverse the trial court’s default

judgment. See TEX. R. CIV. P. 16, 105, 107.

       As the party filing a restricted appeal, it is the duty of Deutsche to show that: (1) it

brought the appeal within six months after the trial court signed the complained-of judgment,

(2) it was a party to the underlying suit, (3) it did not “participate” in the hearing that resulted in

the complained-of judgment and filed neither any timely post-judgment motions nor requests for

findings of fact and conclusions of law, and (4) error is “apparent on the face of the record.” See

TEX. R. APP. P. 26.1(c), 30; Alexander v. Lynda’s Boutique, 134 S.W.3d 845, 848 (Tex. 2004).

The Halls have not disputed that Deutsche has met qualifications of the first three requirements,

contesting only whether the fourth element (i.e., whether error is apparent from the face of the

record) exists.

       Texas Rule of Civil Procedure 16 requires that “[e]very officer or authorized person shall

endorse on all process and precepts coming to his hand the day and hour on which he received

them, the manner in which he executed them, and the time and place the process was served and

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shall sign the returns officially.” TEX. R. CIV. P. 16. In addition, Rule 105 provides that the

“officer or authorized person to whom process is delivered shall endorse thereon the day and

hour on which he received it, and shall execute and return the same without delay.” TEX. R. CIV.

P. 105. The return must be completed in accordance with Texas Rule of Civil Procedure 107.

TEX. R. CIV. P. 107.

       “‘For well over a century, this court has required that strict compliance with the rules for

service of citation affirmatively appear on the record in order for a default judgment to withstand

direct attack.’”   Ins. Co. of State of Pa. v. Lejeune, 297 S.W.3d 254, 255 (Tex. 2009)

(per curiam) (quoting Primate Constr., Inc. v. Silver, 884 S.W.2d 151, 152 (Tex. 1994) (per

curiam) (citing Wilson v. Dunn, 800 S.W.2d 833, 836 (Tex. 1990); Uvalde Country Club v.

Martin Linen Supply Co., 690 S.W.2d 884, 885 (Tex. 1985); McKanna v. Edgar, 388 S.W.2d
927, 929 (Tex. 1965); Flynt v. Kingsville, 82 S.W.2d 934, 934 (Tex. 1935); Sloan v. Batte, 46
Tex. 215, 216 (1876); Roberts v. Stockslager, 4 Tex. 307, 309 (1849))). Where the endorsement

does not satisfy Rules 16 and 105, a no-answer default judgment cannot withstand direct attack.

Id. at 256. “Any deviation from the rules regarding proper service of process will result in the

setting aside of a default judgment.” Bank of Am. v. Hill, No. 06-10-00053-CV, 2010 WL
4324436, at *2 (Tex. App.—Texarkana Nov. 3, 2010, no pet.) (mem. op.).

       In this case (as occurred in Hill), the district clerk employed the attachment of a green

card (which bears the clerk’s stamp that incorporates a date and time) in lieu of fully completing

the return. We have previously rejected the notion that a “filed for record” stamp constitutes an

endorsement. Id. at *3; see also Dominguez v. State, No. 13-10-00289-CV, 2011 WL 579132, at

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*2 (Tex. App.—Corpus Christi Feb. 17, 2011, no pet.) (mem. op). In addition, Rule 107

provides that “[w]hen the citation was served by registered or certified mail as authorized by

Rule 106, the return by the officer or authorized person must also contain the return receipt with

the addressee’s signature.” TEX. R. CIV. P. 107(c). Therefore, “the green card alone is not proof

of service as required by [R]ule 107.” JPMorgan Chase Bank, N.A. v. Tejas Asset Holdings,

L.L.C., No. 05-11-00962-CV, 2012 WL 3929798, at *1 (Tex. App.—Dallas Sept. 10, 2012, no

pet.) (mem. op.). Absent this proof, there is a facial defect in the return of the service of citation;

the absence of a proper service of citation negates the ability to sustain a default judgment.

       We reverse the trial court’s judgment and remand the case for further proceedings.

                                               Bailey C. Moseley
                                               Justice

Date Submitted:        May 6, 2013
Date Decided:          May 7, 2013

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