DISMISS; Opinion Filed November 20, 2012.
In The
Appimt
Q!tiurt tif
fiftI I1itrirt nf ixa at 1aftwi
No. 05-12-00417-CV
THE BANK OF NEW YORK MELLON, Appellant
1•
CARMEN GUZMAN AND JOSE GUZMAN, Appellees
On Appeal from the 116th Judicial District Court
Dallas County, Texas
Trial Court Cause No. DC-I 0-05458
OPINION
Before Justices Moseley, Fillmore, and Myers
Opinion By Justice Fillmore
Pursuant to former section 51.014(d) of the civil practice and remedies code, the Bank of
New York Mellon (the Bank) brings this agreed interlocutory appeal of the trial court’s order
denying the Bank’s motion for summaryjudgment. We dismiss the appeal for want ofjurisdiction.
Background
In April 2003, Carmen Guzman obtained a mortgage from America’s Wholesale Lender
(AWL) on property in Irving, Texas. in connection with the mortgage, Carmen Guzman signed a
promissory note payable to AWL. Both Carmen and Jose Guzman signed a deed of trust to secure
the note. The deed of trust identified AWL or any holder of the note who was entitled to receive
payments under the note as the lender. The deed of trust also stated the Mortgage Electronic
Registration Systems. inc. (I’VlERS) was a beneficiary of the (teed of trust as a nominee for the lender
and its successors and assigns. In the deed of trust, the Guzmans agreed:
M ERS holds only legal title to the interests granted by Borrower in this Security
Instrument, but, if necessary to comply with law or custom. MERS (as nominee for
Lender and Lender’s successors and assigns) has the right: to exercise any or all of
those interests, including, but not limited to, the right to foreclose and sell the
Property; and to take any action required of Lender, including, but not limited to,
releasing and canceling this Security Instrument.
in May 2009, the Bank threclosed on the property due to the Guzmans’ failure to make the
required mortgage payments. The Guzmans sued the Bank for wrongful foreclosure and breach of
contract and sought declaratory relief. The Guzmans asserted they did not receive notice of the
foreclosure, were not informed they were in default or that the note had been accelerated, and were
not given an opportunity to cure any default. The Guzmans also alleged that MERS, the original
mortgagee listed in the notice of substitute trustee’s sale, was not the original mortgagee because it
(lid not loan principal to the Guzmans, did not have the right to receive any payments from the
Ciuzmans, and was not entitled to receive the proceeds of any foreclosure sale. The Guzmans
claimed the Bank lacked standing to foreclose on the property because it had not received an
assignment of the mortgage from the original mortgagee and MERS did not have the power to assign
the note to the Bank. Finally, the Guzmans asserted the Bank had not produced the original note or
an assignment of the note that would make the Bank a holder of the note under the business and
commerce code and, therefore, was not a person entitled to enforce the instrument.
The Bank moved for summary judgment on the Guzmans’ wrongful foreclosure claim on
grounds that (I) all notices required under the property code were provided to the Guzmans, and (2)
the Guzmans’ possession of the property had been continuous and uninterrupted and, therefore, they
had not been dainaed. Uhe Bank argued it had standing to loreclose on the property because the
deed of trust signed by the Guzmans authorized M ERS. as nominee fr the original mortgagee and
its successors and assigns. to act as a beneficiary under the deed of trust and to foreclose and sell the
property. The Bank asserted the right to foreclose on a lien created by a deed of trust is separate
from a suit to collect a debt. The Bank also argued the Guzrnans did not have standing to challenge
the assignment of the note and the deed of trust. The Bank moved for summary judgment on the
Guzmans’ breach of contract claim on the ground the Ciuzmans were in default of their contractual
obligation to repay the indebtedness and, therefore, could not assert a claim for breach of contract.
Finally, the Bank moved for summary judgment on the Guzmans’ request for a declaratory judgment
on the ground that, without a viable claim for breach of contract or wrongful foreclosure, the
Guzmans were not entitled to declaratory relief.
The Guzmans filed a competing motion for summary judgment on their claim for wrongful
foreclosure and request for declaratory relief on grounds (1) the Bank failed to provide notice of the
foreclosure as required by section 5 1 .002 of the property code, (2) the Bank failed to provide notice
of default and notice of an opportunity to cure as required by the deed of trust, (3) the Bank failed
to provide notice the note was being accelerated, and (4) neither the l3ank nor MERS had standing
to foreclose because they were not persons entitled to enforce the promissory note under section
3.301 of the business and commerce code, were not nonholders with rights of a holder, and could
not prove the note had been lost, stolen, or destroyed.
The trial court denied the competing motions for summary judgment on the basis that the
Bank and the Guzrnans “failed to satisfy [their] burden.” The parties filed a joint motion to appeal
from interlocutory order” contending the “issues raised in [the] dispositive motions involve
controlling questions of law as to which there is a substantial ground for difibrence ofopinion, and
obtaining a ruling on those issues of law from the appeals court will materially advance the outcome
of this case.” The trial court granted the motion, and the Bank brought this appeal.
After the appeal was submitted, the Court sent a letter to the parties questioning whether it
had jurisdiction over this appeal. The Court specifically requested that, in light of this Court’s
opinions in colonial Counti’ Mutual Insurance Co. v. Amava, 372 S.W.3d 308 flex. App.—Dallas
2012, no pet.) and State Fair of Texas v. Iron Mountain Information Management. Inc., 299 S.W.3d
261 (Tex. App.—Dallas 2009, no pet.), the parties address whether an appeal from the trial court’s
orderwould materiafly advance the ultimate termination ofthe litigation and whether due to the trial
court’s failure to rule on the purported controlling issues of law, any opinion issued by this Court
would be advisory. The Bank responded, arguing the controlling issues oflaw presented to the trial
court were the same as those presented on appeal, the facts are not in dispute, and the trial court ruled
on the parties’ motions. The Bank contends this Court has “the inherent power, responsibility, and
opportunity. . . to make decisions, when possible and necessary, [and] to give guidance to the trial
court when necessary.”
JurIsdiction
We are required to review sua sponte issues affectingjurisdiction. U a DentalLab. v. Rape,
139 S.W.3d 671, 673 (Ta. 2004) (per curiam). Unless a statute specifically authorizes an
interlocutory appeal, appellate courts havejurisdiction over finaljudgments only. Lehmann v. Har
Con Corp., 39 S.W.3d 191, 195 (Ta. 2001). Pursuant to former section 51.014(d) of the civil
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practice and remedies code, a district court may order an interlocutory appeal from an otherwise
unappealable order in a civil action if the parties agree that the order involves a controlling question
of law as to which there is a substantial ground for difference of opinion, an immediate appeal from
the order may materially advance the ultimate termination of the litigation, and the parties agree to
the order. Act of May27, 2005,79th Leg., R.S., ch. 1051, § 1,2005 Tex. Gen, Laws 3512, 3513
(applying to lawsuits filed on or after September 1, 2005), amended by Act of May 25, 2011, 82d
Leg., ch. 203, § 3.01, 2011 Tex. Gen. Laws 758, 759 (current version at TEX. Civ. PRAC. & REM.
CODE ANN. § 51.014( (West Supp. 2012)).
The Bank asserts there is no disagreement between the parties as to the underlying facts, and
the “controlling legal issues” are whether (1) service of notice pursuant to the property code is
effective when sent or when received, (2) MERS has standing as the trustee to foreclose and to
assign its right to foreclose, (3) a loan servicer must be a holder-in-due-course of the note or security
in order to foreclose, (4) transfer of the deed of trust without transfer of the note acts to invalidate
both documents for the purpose of enforcement, and (5) the Guzmans are barred from maintaining
an action for wrongful foreclosure when they continue to reside on the property and, therefore, have
no damages. We agree with the Bank that the issues raised on appeal were presented to the trial
court by both parties in competing motions for summaryjudgment, However, the trial court denied
both parties’ motions for summary judgment because they “failed to meet their burden.” Even ifwe
agree with the Bank that there are no issues of material fact that could serve as the basis for the trial
court’s denial of both motions for summary judgment, there is simply nothing in the record showing
the trial court made a substantive ruling on any of the legal issues we are being asked to decide.
in a similar case, the San Antonio Court of Appeals refused to decide, in an agreed
interlocutory appeal, an issue that the parties presented as a controlling legal question because the
trial court had expressly declined to rule on the legal issue and, instead, submitted the issue to the
intermediate court of appeals for a decision. GuiLt’ v. State Farm Lloyds, 350 S.W.3d 204,207—08
(Tex. App.—San Antonio 2011, no pet.). Our sister court reversed the trial court’s judgment,
concluding the thai court erred by declining to nile on the controlling legal question. It remanded
the case to the trial court so that it could “make a substantive decision on the ‘matter oflaw’ question
presented....” Id.208. Tndoingso,thecourtstated:
section 51.014(d) does not contemplate use ofan immediate appeal as a mechanism
to present, in effect, a “certified question” to this Court similar to the procedure used
by federal appellate courts in certifying a detenninative question of state law to the
Texas Supreme Court.... We have found no reported case in which 51.014(d) was
used in this manner to present an intermediate court of appeals with a “controlling
legal question” prior to the trial court making a substantive ruling on the legal issue.
Id. at 207 (internal citations omitted).’
In this case, the that court did not substantively rule on the controlling legal issues presented
in the agreed interlocutory appeal and, instead, submitted the issues to this Court for a decision. in
Amaya, we stated that we did not believe the Texas Legislature intended the parties to use section
51.014(d) ofthe civil practice and remedies code to obtain an appellate ruling on an issue of law on
which the trial court refused to rule. Amaya, 372 S.W.3d at 310-11; see also State Fair ofTez, 299
S.W.3d at 264 (“Absent legislative mandate, we may not disregard the statutory requirements to
Thc San Antonio Court of Appeals concluded in Gul(v that the statutory requirements loran agreed interlocutory appeal technically were met
t
and ithadjuriadiction ow the appeal. SeeActolMay 27.2005.79th Leg.. R.S., cli. 1051,11,2005 Ta Ore. Laws3512, 3513 (amended2ol 1)
GuIfr. 350 5.W.3d at 208 n.2. However. In Gully the only issue pseaented hi the ewes-motions for sinumaty judgment was the issue pw’J to
thecourtofappeals. In this case. the Bank admits more than one issue was presented below. Any ofthese issues or the existence ofa material issue
of (hot could have fonned the basis of the trial court’s ruling that neither party had met its burden. see Amaya. 372 5.W.3d at 311 nI.
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enlarge appellate jurisdiction to any agreed interlocutory appeal.”).
2 Consequently, we conclude that
any opinion issued by this Court in this interlocutory appeal would necessarily be advisor because
there is nothing in the record showing that the trial court ruled on the specific legal issues that are
presented for us to decide. See Aniava, 372 S.W.3d at 311: Gully, 350 S.W.3d at 208 (“Section
5 1 .014(d) is not intended to relieve the trial Court of its role in deciding substantive issues of law
properly presented to it.”). We dismiss the appeal for want ofjurisdiction. See Arnava, 372 S.W.3d
at 311.
.. .. ...
.
ROBERT M. FILLMORE
JUSTiCE
12041 7F.P05
2
The Bank asserts .lr,iaia and Stoic Fair of Texas are distinguishable because, in those cases, this Court “was left guessing what the issues
on appeal were” while, in this ease, the issues before the trial court are the issues raised on appeal. In Slate Fair of Tacos, the trial court granted a
motion for sumniarv judgment without specifying the basis or bases of its ruling. Stare Fair of Tex.. 299 S.W.3d at 264. We concluded we did hot
have jurisdiction over thc agreed interlocutory appeal because the parties’ briefs raised different issues and Otiled to identify a controlling question
oflawastowhieh there is a substantial ground fordiffereneeofopinion. Id. In..lmais. the trial court denied a motion for sutnman judgment without
stating the basis for the denial. We noted there were multiple bases on which the trial court could have denied the motion, including that there was
an issue of material fhct. However, there was nothing in the record shawing the trial court made a substantive ruling on the legal issue we are being
asked to decide.” ,loiai’a. 372 SW.3d at 310. We conclude both .4maia and State Fair of Texas support the proposition that the trial court must
make a substantive ruling on the controlling question of law that is the subieet of the agreed interlocutory appeal before this Court has jurisdiction
over the appeal.
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0
nurI øf Apprih
fiftIi Jitrirt uf tt Ia11t!
JUDGMENT
THE BANK OF NEW YORK MELLON. Appeal from the 16th Judicial District
Appellant Court of Dallas County, Texas. (Tr.Ct.No.
DC-I 0-0545).
No. 05-12-0041 7-CV Opinion delivered by Justice Fillmore,
Justices Moseley and Myers participating.
(RMEN GU/MAN AND JOSE
GUZMAN. Appellees
In accordance with this Court’s opinion of this date. this appeal is D1S’ItSSED. It is
ORDERED that appellees Carmen Guzman and Jose Guzrnan recover their costs of this appeal
from appellant The Bank of New York Mellon.
.Judgment entered November 20, 2012.
/•••
.........
ROBERT M. FILLMORE
JUSTICE