Bank of New York Mellon v. Smith

159 So. 3d 1088, 14 La.App. 3 Cir. 924, 2015 La. App. LEXIS 259, 2015 WL 542816
CourtLouisiana Court of Appeal
DecidedFebruary 11, 2015
DocketNo. 14-924
StatusPublished
Cited by1 cases

This text of 159 So. 3d 1088 (Bank of New York Mellon v. Smith) is published on Counsel Stack Legal Research, covering Louisiana Court of Appeal primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Bank of New York Mellon v. Smith, 159 So. 3d 1088, 14 La.App. 3 Cir. 924, 2015 La. App. LEXIS 259, 2015 WL 542816 (La. Ct. App. 2015).

Opinion

COOKS, Judge.

|, FACTS AND PROCEDURAL HISTORY

This protracted litigation concerns an alleged default on a residential mortgage entered into by Whitney Blaine Smith and Pamela Deann LaCour Smith with Saxon Mortgage Services in 1999. The trustee for Saxon, J.P. Morgan Chase Bank sued to enforce the mortgage and promissory note via executory process. Chase was represented by Dean Morris, L.L.P. This court in Bank of New York Mellon v. Smith, 11-60, pp. 2-5 (La.App. 3 Cir. 6/29/11), 71 So.3d 1034, 1038-39, writ denied, 11-2080 (La.11/18/11), 75 So.3d 462 (footnote omitted), set forth in greater detail the pertinent facts:

The current claims of Mellon and Smith had their genesis in an earlier suit, brought by Chase in 2004 and dismissed without prejudice in 2009. Where clarity requires, we will refer to the 2004 Chase suit as Suit # 1, and we will refer to the current suit, the 2009 Mellon suit, as Suit # 2.
Suit # 1
In June of 2004, the Smiths defaulted on their 1999 mortgage loan with Saxon Mortgage Services, Inc. (Saxon). The loan was secured by the Smiths’ home in Grant Parish. Two months after missing the June payment, Whitney Smith died in an automobile accident. Pamela Smith alleged that there was life insurance on the loan that should have paid it off upon Whitney’s death, and she has a suit in federal court against the insurance company.
In November of 2004, Chase, as trustee for Saxon, sued the Smiths by execu-tory process, asked for the appointment of an attorney curator to represent Whitney, and caused the Sheriff of Grant Parish to deliver a notice of seizure to Pamela Smith on December 8, 2004. The seizure under executory process was constructive, allowing the debt- or thirty days to defend against the actual seizure of the collateralized property. Smith, fearing that she would be evicted'from her home over the holidays, moved her children out of the house and filed for an injunction to stop the seizure by executory process.
At the hearing on the preliminary injunction in April of 2005, Judge Krake considered Smith’s petition and testimony, along with the oppositions and affidavits of Chase and Saxon, and found in [1091]*1091favor of Smith. The executory process employed by Chase was defective and not in authentic form due to Chase’s failure to attach the original Note or certified copies of the Note and Mortgage to its petition in 2004. The face of the Note, which was apparently lost in 2004, bears |2a stamp stating “Paid and Canceled by JP Morgan Chase,” dated November 8, 2004. The stamp is unsigned and has an X over it. The May 2005 judgment of Judge Krake granted Smith’s injunction and enjoined any sale of her home by executory process, ordered Chase to convert the executory proceeding to an ordinary proceeding, and preserved Smith’s claims of wrongful seizure under state and federal law. Chase did not appeal this judgment and three weeks later converted its suit to a foreclosure by ordinary proceeding.
In September of 2005, Smith reconvened against Chase and filed a third party demand against Saxon, asserting wrongful seizure under Louisiana law, conversion, and due process violations under federal law, 42 U.S.C. 1983. Under the third cause of action, Smith alleged that Chase, Saxon, and Dean Morris were solidarily liable, and were state actors for the purposes of 42 U.S.C. 1983, in that they had wrongfully used the executory process and “the powers and authorities of the State of Louisiana” to seize her home. She further asserted that, while executory process is basically constitutional, it was employed in an unconstitutional manner by Chase, Saxon, and Dean Morris. In 2006, Chase, Saxon, and Dean Morris filed a motion to dismiss Smith’s claims for failure to serve.
On November 2, 2006, Judge ad hoc Peyton Cunningham dismissed Smith’s claims pursuant to La.Code Civ.P. art. 1672(C), which mandates a dismissal without prejudice and allows the re-filing of suit. The dismissal by Judge Cunningham came to this court on appeal, but before we rendered a decision, Smith re-asserted her demands against Chase and Saxon for wrongful seizure. Chase and Saxon filed four exceptions and a motion to strike the jury demand against Smith’s re-asserted demands, which were apparently not heard until July of 2009.
In May of 2008, finding no written waiver of service by Chase or Saxon of Smith’s 2005 incidental demands, and finding that her faxing of the demands was insufficient where service was required by the sheriff, we affirmed Judge Cunningham’s 2006 dismissal without prejudice. See JP Morgan Chase Bank v. Smith, 07-1580 (La.App. 3 Cir. 5/21/08), 984 So.2d 209. We did not address Smith’s re-asserted demands or the exceptions to them, which were not within our purview or knowledge.
At the July 2009 hearing on Chase’s and Saxon’s various exceptions to Smith’s re-asserted demands, Judge ad hoc Ronald Lewellyan informed the parties that he was going to dismiss the entirety of Suit # 1.
On August 3, 2009, without ruling on the re-asserted demands or the exceptions, Judge Lewellyan issued a judgment dismissing Suit # 1, Chase’s suit against Smith, and Smith’s re-asserted demands against Chase and Saxon.
Suit # 2
|sOn July 30, 2009, Mellon filed a suit against Smith to enforce the Note and Mortgage by ordinary proceeding.
On September 17, 2009, Smith answered Mellon’s suit, asserting an exception of no right of action and a recon-ventional demand against Mellon, and asserting third party demands against [1092]*1092Chase and Dean Morris. As in Suit # 1, Smith again asserted wrongful seizure under state law, conversion, and due process violations under 42 U.S.C. 1983.
Mellon, Chase, and Dean Morris filed numerous exceptions to Smith’s recon-ventional and third party demands. The trial court granted all exceptions filed by Mellon, Chase, and Dean Morris, and it denied Smith’s exception of no right of action against Mellon.

This court overruled the trial court’s grant of the exception of no cause of action, finding the facts alleged by Smith were sufficient to state a cause of action under state law and under 42 U.S.C. § 1983 (hereafter section 1983) for the alleged wrongful seizure of Smith’s home. We found Smith’s allegations were sufficient to establish that the seizing creditor and its counsel, Dean Morris, L.L.P., were state actors subject to liability for the seizure of Smith’s home under section 1983.

Mellon Bank applied for writs to the Louisiana Supreme Court, contending this court erred in finding the confession of judgment language in the October 18,1999 mortgage was deficient under La.Code Civ.P. art. 2632. The writ was denied by the supreme court on November 18, 2011.

Free access — add to your briefcase to read the full text and ask questions with AI

Related

The Bank of New York Mellon v. Whitney Blaine Smith, Et Ux.
180 So. 3d 1238 (Supreme Court of Louisiana, 2015)

Cite This Page — Counsel Stack

Bluebook (online)
159 So. 3d 1088, 14 La.App. 3 Cir. 924, 2015 La. App. LEXIS 259, 2015 WL 542816, Counsel Stack Legal Research, https://law.counselstack.com/opinion/bank-of-new-york-mellon-v-smith-lactapp-2015.