IN THE COURT OF APPEALS OF THE STATE OF MISSISSIPPI
NO. 2016-CA-00879-COA
TONY L. PAGADOR APPELLANT
v.
TRUSTMARK NATIONAL BANK APPELLEE
DATE OF JUDGMENT: 05/17/2016
TRIAL JUDGE: HON. ROGER T. CLARK
COURT FROM WHICH APPEALED: HARRISON COUNTY CIRCUIT COURT,
FIRST JUDICIAL DISTRICT
ATTORNEYS FOR APPELLANT: TIMOTHY BROWN
WILLIAM JOSEPH KERLEY
ATTORNEYS FOR APPELLEE: WILLIAM “TREY” JONES III
WILLIAM DEMENT DRINKWATER
TAYLOR BRANTLEY MCNEEL
NATURE OF THE CASE: CIVIL - REAL PROPERTY
DISPOSITION: AFFIRMED - 08/29/2017
MOTION FOR REHEARING FILED:
MANDATE ISSUED:
EN BANC.
LEE, C.J., FOR THE COURT:
¶1. Tony Pagador appeals the judgment of the Harrison County Circuit Court granting
Trustmark National Bank’s motion for summary judgment arising from the foreclosure of
Pagador’s home. Following a de novo review, we affirm.
FACTS AND PROCEDURAL HISTORY
¶2. In 2006, Pagador purchased a home at 13429 Libby Lane in Gulfport, Mississippi.
To purchase the home, Pagador entered into a deed of trust with T. Graham Mortgage Inc.,
which was secured with a promissory note. The deed of trust contained a “[r]ider” and
incorporated an addendum from the Department of Veteran Affairs (VA) guaranteeing the
loan, as Pagador was a veteran with the United States Coast Guard. T. Graham Mortgage
assigned the deed of trust to Trustmark National Bank.
¶3. Pagador made timely mortgage payments on the loan up until June 2010, when he
learned that the house contained toxic Chinese drywall. Pagador and his family then moved
out of the home so that remedial work could be performed on the house. He asked Trustmark
for a forbearance from monthly loan payments for the period of time he and his family were
not living in the home while repairs were being made. Trustmark offered Pagador a special
VA forbearance and informed him by letter, which he signed and returned, that his loan was
in forbearance from July 1, 2010, through December 31, 2010. The letter further specified
that after December 31, 2010, Pagador would “be required to pay the total amount past due
for the period of time in which no payments were made . . . .”
¶4. In May 2011, Pagador requested an additional forbearance period because the drywall
repair was still not complete. Trustmark issued a second forbearance period, which the
parties agree ended August 31, 2011. In September 2011, Pagador requested a third
forbearance period because the drywall remediation was still not complete. In an email to
Trustmark dated February 13, 2012, Karla Pagador, Pagador’s mother, alleged that James
Hodges, a VA representative, had verbally advised Pagador that Trustmark had extended the
forbearance until March 7, 2012. However, there was no communication, documentation,
or other evidence indicating Trustmark had granted a third or extended forbearance. Rather,
Pagador was notified by substitute trustee, Gerald Warren, via certified mail dated February
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10, 2012, that Trustmark was foreclosing on the home.
¶5. Specifically, the notice letter stated that “Trustmark National Bank [had] previously
notified [Pagador] by certified mail that the above referenced loan [was] in default and
declared all of the indebtedness secured by [the deed of trust] . . . to be due and owing.” The
notice advised that Warren had been instructed to initiate foreclosure proceedings and stated
that the foreclosure was scheduled for March 22, 2012. The notice further provided that “[i]n
order to cure the default and reinstate the loan, the amount of $21,585.75 is due . . . .”
Finally, the notice advised that the loan must be reinstated or paid in full prior to the day of
sale, and if not reinstated or paid in full, then the foreclosure sale would proceed as indicated.
¶6. It is undisputed that Pagador made no mortgage payments after June 2010. Pagador
did not cure the default, and neither did he object to the foreclosure. On March 22, 2012,
Trustmark foreclosed on Pagador’s home. Pagador now appeals.
STANDARD OF REVIEW
¶7. This Court employs a de novo standard when reviewing a circuit court’s grant of
summary judgment. Blanchard v. Mize, 186 So. 3d 403, 405 (¶11) (Miss. Ct. App. 2016)
(citing In re Admin. of Estate of May, 32 So. 3d 1227, 1229 (¶5) (Miss. Ct. App. 2010)).
Summary judgment should be granted where “the pleadings, depositions, answers to
interrogatories and admissions on file, together with the affidavits, if any, show that there is
no genuine issue as to any material fact and that the moving party is entitled to a judgment
as a matter of law.” Id. (quoting M.R.C.P 56(c)). We must examine all of the evidence
before the trial court in the light most favorable to the nonmoving party. Id. “The party
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opposing the motion may not rest upon the mere allegations or denials of his pleadings, but
his response, by affidavits or as otherwise provided in Rule 56, must set forth specific facts
showing that there is a genuine issue for trial.” Id. (quoting Estate of May, 32 So. 3d at 1229
(¶5) (quoting M.R.C.P. 56(e))). “Bare assertions are not enough to avoid summary judgment
. . . .” Lott v. Purvis, 2 So. 3d 789, 792 (¶11) (Miss. Ct. App. 2009) (internal quotations and
citations omitted).
DISCUSSION
¶8. Pagador argues that the circuit court erred in granting Trustmark’s motion for
summary judgment. Specifically, Pagador asserts there is a genuine issue of material fact
regarding (1) whether Pagador was in default at the time Trustmark foreclosed on his home
and (2) whether Trustmark breached the contract by failing to follow the conditions
precedent specified in the deed of trust and the VA regulations and guidelines prior to
foreclosing on Pagador’s home.
I. Default
¶9. Pagador claims he was not in default at the time Trustmark foreclosed because he was
in a special VA forbearance. However, Trustmark met its burden of showing an absence of
a genuine issue of material fact with respect to this claim. The record shows and the parties
agree that Pagador was granted two forbearance periods: one from July 1, 2010, through
December 31, 2010, and a second from May 2011 through August 31, 2011. Pagador now
claims in his brief on appeal that the forbearance “was extended up until on or about March
7, 2012,” and again that “his special VA forbearance period was repeatedly extended all the
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way up to the March 22, 2012 foreclosure sale.” But, apart from his bare assertions, Pagador
provided no evidentiary support for this claim.
¶10. The Mississippi Supreme Court has held that “other than undenied allegations in the
party’s pleadings and [Mississippi Rule of Civil Procedure] 36 admissions, all material
submitted in opposition to summary judgment must be sworn.” Handy v. Madison Cty.
Nursing Home, 192 So. 3d 1005, 1010 (¶16) (Miss. 2016). As such, the email in which
Pagador’s mother, a nonparty, asserts that Hodges, also a nonparty, purportedly told Pagador
that a third forbearance had been approved is improper summary-judgment evidence.
Pagador failed to produce any documentation, affidavits, or otherwise proper summary-
judgment evidence to support his claim that he was still in forbearance. In fact, neither
Pagador’s complaint nor his affidavit claims that a third or extended forbearance was ever
granted.
¶11. Under the terms of the promissory note, Pagador was in default when he failed “to pay
the full amount of each monthly payment on the date it [was] due.” The facts clearly show
that Pagador’s last mortgage payment was made in June 2010 and that his final forbearance
period ended August 31, 2011. As such, it is clear there is no genuine issue regarding
whether Pagador was in default at the time of the foreclosure on March 22, 2012. This issue
is without merit.
II. Breach of Contract
¶12. Pagador also asserts that Trustmark breached the parties’ contract by failing to comply
with VA regulations and guidelines by extending the time period for foreclosure and by
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failing to provide him with proper notice of acceleration prior to foreclosure.
A. VA Regulations and Guidelines
¶13. Pagador argues that Trustmark was required to comply with VA regulations and
guidelines, to specifically extend the time period for foreclosure. However, in his appellate
brief, Pagador admits that nothing in Mississippi law has addressed VA regulations and
guidelines being incorporated into a mortgage. Furthermore, there is nothing in the deed of
trust, VA rider, VA regulations, VA servicing guidelines, or otherwise that would require
Trustmark to grant an additional forbearance, extend the time prior to the foreclosure, or
refrain from foreclosure. In response to Trustmark’s motion for summary judgment, Pagador
does not cite to any specific VA regulations or guidelines that would require an additional
forbearance period or prohibit the lender from foreclosure. Rather, Pagador references
generally the VA guidelines’ stated purpose of limiting foreclosures on VA guaranteed loans
through various loss-mitigation options, including repayment plans, loan modifications,
special forbearance, compromise sale, or deed in lieu of foreclosure.
¶14. Indeed, Trustmark participated in such loss-mitigation options by extending Pagador
two forbearance periods. There was nothing in the deed of trust or other incorporated
documents that imposed a duty on Trustmark to grant an additional forbearance period or
otherwise refrain from foreclosure. Accordingly, there is no genuine issue of material fact
with respect to whether Trustmark breached the contract by failing to comply with VA
guidelines and regulations.
B. Notice of Acceleration
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¶15. Pagador also argues that Trustmark was required under the deed of trust to “give
notice to Borrower prior to acceleration following Borrower’s breach of any covenant or
agreement in this Security Instrument . . . .” However, the mortgage addendum for the VA
guaranteed loan specifically stated, “The Borrower agrees that the Lender or its assignee may
at any time without prior notice accelerate all payments under the Deed to Secure Debt and
Note and exercise any other remedy allowed by law, including foreclosure, for breach of the
Deed to Secure Debt or Note . . . .” (Emphasis added). Furthermore, the addendum provided
that “[i]n the event of any conflict between the provisions of this Rider and the provisions
of the Deed to Secure Debt or Note, the provisions of this Rider shall control.” As such, the
addendum controls, and Trustmark was not required to give notice prior to acceleration of
the debt. This issue is without merit.
III. Pagador’s Remaining Claims
¶16. Pagador also asserts various other arguments, including misrepresentation, fraud,
promissory estoppel, negligence, wrongful foreclosure, negligent infliction of emotional
distress, unjust enrichment, breach of the implied covenant of good faith and fair dealing, and
breach of fiduciary duty. None of the facts in the record, when viewed in light most
favorable to Pagador, support these claims. Under the terms of the deed of trust, promissory
note, and VA rider, Trustmark was well within its rights to foreclose. After granting Pagador
two separate forbearance periods, Trustmark notified him of the foreclosure proceedings.
Pagador failed to object to the foreclosure, and the foreclosure took place as set forth. When
a property owner fails to object to the foreclosure before the sale, he has waived any ground
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to challenge the foreclosure. Robinson v. Trustmark Nat’l Bank, 179 So. 3d 1146, 1150 (¶19)
(Miss. Ct. App. 2015). Thus, in addition to the fact that these claims lack merit, Pagador has
waived the right to raise them on appeal.
¶17. The concurring opinion interprets Robinson as holding that if a debtor does not object
before, during, or immediately after the foreclosure sale, he has “waived only his right to
have the sale set aside . . . .” In doing so, the concurring opinion states that “Pagador’s
failure to object . . . waived only his right to have the sale set aside, not a claim for damages.”
However, Robinson states that a failure to raise objections before the sale “waived any
ground to challenge the foreclosure.” Robinson, 179 So. 3d at 1150 (¶19). The concurring
opinion mistakes “challenge the foreclosure” as synonymous with “have the sale set aside.”
Thus, the concurring opinion confuses the right available to the injured mortgagor—to
challenge the sale through a wrongful-foreclosure action—with the remedies available to the
injured mortgagor—“(1) having the sale set aside and (2) recovering from the mortgagee the
damages suffered as a result of the wrongful foreclosure.” Nat’l Mortg.Co. v. Williams, 357
So. 2d 934, 936 (Miss. 1978). In the instant case, Pagador seeks the remedy of
damages—however, his cause of action remains one for wrongful foreclosure. Our body of
caselaw on wrongful foreclosures is not rendered inapplicable in the instant case simply
because, here, the mortgagor seeks the remedy of damages. Accordingly, Pagador’s failure
to object to the sale waived any grounds to challenge the foreclosure.
¶18. AFFIRMED.
GRIFFIS, P.J., CARLTON AND WESTBROOKS, JJ., CONCUR. IRVING,
P.J., AND ISHEE, J., CONCUR IN PART AND IN THE RESULT WITHOUT
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SEPARATE WRITTEN OPINION. BARNES, J., SPECIALLY CONCURS WITH
SEPARATE WRITTEN OPINION, JOINED BY ISHEE, J. WILSON, J., CONCURS
IN RESULT ONLY WITHOUT SEPARATE WRITTEN OPINION. FAIR AND
GREENLEE, JJ., NOT PARTICIPATING.
BARNES, J., SPECIALLY CONCURRING:
¶19. While I concur with the majority’s affirming the circuit court’s grant of summary
judgment to Trustmark, I disagree with the determination that Pagador waived his claims by
failing to object to the foreclosure sale.
¶20. To support its finding of waiver, the circuit court cited Jackson v. Bank of America,
No. 3:13CV581-LG-JCG, 2014 WL 5511017, at *5 (S.D. Miss. Oct. 31, 2014), which held
that when a mortgagor has actual notice of a foreclosure sale and fails to object, he is
“estopped from subsequently challenging the title of the purchaser.” However, what the
circuit court failed to consider is the district court’s holding that the plaintiff’s claims for
negligence, unjust enrichment, and fraudulent conveyance should be dismissed “because each
of these claims seeks to have the sale voided or set aside for irregularities in the foreclosure
sale.” Id. at *6 (emphasis added). Similarly, the majority cites Robinson v. Trustmark
National Bank, 179 So. 3d 1146, 1150 (¶16) (Miss. Ct. App. 2015), where this Court held
that because the appellant failed to raise her issues before the sale, she waived “any ground
to challenge the foreclosure.” In that case, we noted our “consistent” holding that if a debtor
does not object before, during, or immediately after the foreclosure sale, “he waives his
grounds for challenging the sale.” Id. (emphasis added); see also Nichols v. Bush, 913 So.
2d 387, 391 (¶22) (Miss. Ct. App. 2005) (finding a plaintiff’s “silence” during the
foreclosure sale “waived any irregularity in the sale and . . . estopped [him] from seeking to
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have the foreclosure set aside”).1 Were Pagador seeking to set aside the foreclosure sale, I
would agree with the circuit court and the majority that he had waived his claims.2
¶21. But as Pagador asserts, he does not “seek to have the sale voided or set aside for
irregularities in the foreclosure sale”; he seeks monetary damages. Therefore, Jackson and
Robinson are inapplicable to this case, as neither stands for the proposition that there is
absolutely no relief available to a plaintiff after foreclosure if he fails to object to the
proceedings. These cases simply hold that if a plaintiff makes no objection to the
foreclosure, he may not challenge or set aside the sale.
¶22. I have found no precedent that a plaintiff waives any and all rights to bring an action
for damages for wrongful foreclosure if he fails to object to the sale. In National Mortgage
Company v. Williams, 357 So. 2d 934, 936 (Miss. 1978), the Mississippi Supreme Court
stated:
In general, the authorities support the rule that an action at law by the
mortgagor against the mortgagee will lie to recover damages for a wrongful
1
This holding is grounded on the doctrine of equitable estoppel:
[O]ne of the established rules of the doctrine is that, if a person knowingly
suffers another to expend money on land under an erroneous opinion of title,
although he does it passively by looking on without making known his claim,
he shall not afterwards be permitted to enforce his legal right against such
other.
Nichols, 913 So. 2d at 391 (¶20) (quoting Kelso v. Robinson, 172 Miss. 828, 840-41, 161
So. 135, 137 (1935)).
2
The Robinson court found the former property owner “had a duty to speak, and her
silence as to the legitimacy of the foreclosure and the documents supporting the sale
effectively estopped her from challenging the title of the subsequent purchaser.” Robinson,
179 So. 3d at 1149 (¶15) (emphasis added).
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foreclosure that is, a foreclosure without right, which would ordinarily be
ineffective and invalid irrespective of the manner in which it is executed.
Generally, in such circumstances, the mortgagor has the right to elect between
(1) having the sale set aside and (2) recovering from the mortgagee the
damages suffered as a result of the wrongful foreclosure.
Actions at law for damages for premature foreclosures have been sustained,
particularly where a required demand of payment was not made to accelerate
maturity, although there is authority to the effect that a right to maintain such
an action may be lost by electing to proceed in equity for the return of the
equity of redemption and obtaining a decree ordering restoration of the
property.
(Quoting 55 Am. Jur. Mortgages § 535, 516-17 (1971)). Thus, our supreme court has
distinguished between the two types of relief requested in an action for wrongful foreclosure.
See also C&K Invs. v. Fiesta Grp. Inc., 248 S.W.3d 234, 254 (Tex. App. 2007) (The failure
to foreclose on property properly “gives rise to a cause of action for either the return of the
property or damages.”) (emphasis added). Pagador’s failure to object prior to, or
immediately after, the sale waived only his right to have the sale set aside, not a claim for
damages.
ISHEE, J., JOINS THIS OPINION.
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