Billings v. U.S. Bank National Ass'n

2016 Ark. App. 134, 484 S.W.3d 715, 2016 Ark. App. LEXIS 149
CourtCourt of Appeals of Arkansas
DecidedMarch 2, 2016
DocketCV-15-680
StatusPublished
Cited by3 cases

This text of 2016 Ark. App. 134 (Billings v. U.S. Bank National Ass'n) is published on Counsel Stack Legal Research, covering Court of Appeals of Arkansas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Billings v. U.S. Bank National Ass'n, 2016 Ark. App. 134, 484 S.W.3d 715, 2016 Ark. App. LEXIS 149 (Ark. Ct. App. 2016).

Opinion

BART F. VIRDEN, Judge

|, This appeal stems from the Crawford County Circuit Court’s denial of Montrevel Billings’s motion for reconsideration. When Doann Billings passed away in 2011, her mortgage with U.S. Bank for 701 South 38th Street in Van Burén was past due. Doann’s son, Montrevel Billings, moved into the home and expressed his interest in assuming the loan. U.S. Bank, the holder of the mortgage, and Billings could not reach an agreement, and the bank proceeded with the foreclosure. U.S. Bank filed a complaint on April 20, 2012, and in it stated that Montrevel might “be claiming a tenancy interest in the subject property.”

U.S. Bank requested to proceed with constructive service via a warning order to bS issued to the unknown heirs of Doann Billings and the occupants of the home. The circuit court granted the request on May 3, 2012. The affidavit for a warning order set forth that cbunsel for U.S. Bank “made diligent inquiry and that it is its information and belief that |aDefendant(s), THE UNKNOWN HEIRS OF DOANN BILLINGS ... are no longer resident at their last-known address of 701 South 38th Street, Van Burén, Arkansas 72956. Plaintiff, by its attorneys, further states that Defendant(s)’ present address(es) are unknown.”

A week later on May 10, 2012, a fax entitled “Doann Billings” and with the message “Petition for Appointment of Personal Representative” was sent from the Booth Law Firm to counsel for U.S. Bank, Scott Goldsholl. The fax was a request for Montrevel to be appointed as the personal representative of Doann’s estate, and it listed his address as “701 S. 38th St., Van Burén, AR 72956[.]” The petition also listed Montrevel as Doann’s son and heir.

Two days later, U.S. Bank placed its warning order in, the Press-Argus Courier, The warning order ran two times, the first publication being on May 12 and the last publication on May 19, 2012. U.S. Bank filed an amended complaint on May 16, 2012, naming Montrevel Billings and his sisters, Madeline Billings and Raachell Billings, as the three known heirs. The affidavit listed their addresses and showed Montrevel’s address as. being that of the home at issue.

U.S. Bank filed another affidavit for a warning order on June 22, 2012, and in it U.S. Bank asserted,that, after a-diligent inquiry, it ascertained that Montrevel Billings was no longer a resident at 701 South 38th Street and that his current address was unknown. The second warning order ran in the Press-Argus Courier on June 27 and again on July 4,2012.

On October 3, 2012, U.S. Bank filed an affidavit of service, claiming that it had properly executed the warning order and that it had also mailed a copy of the warning order |sto the last-known address of Montrevel Billings. ,' The attached copies of the envelopes showed that the letter had been mailed July 5, July 10, and July 20, 2012, and stamped by the post office as “unclaimed.”

On October 15, 2012, the circuit court entered a default judgment in which -it dismissed Montrevel, declared the home to be in foreclosure, and ordered the home to be sold in a commissioner’s sale. Notice of the commissioner’s sale was done by warning order in the Press-Argus Courier on October 20, 2012. On November 8, 2012, U.S. Bank filed a motion to postpone the commissioner’s sale and requested that the sale be reset for December 14, 2012. The motion was granted.

On November 9, 2012, Montrevel filed á motion to vacate the decree of foreclosure. In his motion, he asserted that the decree was void for lack of service. Montrevel argued that he had been living at the home in question since his mother’s death, and that the first notice he had received was on October 26, 2012, in the form of a letter informing him that a commissioner’s sale would take place on November 14, 2012. He asserted that the letter of service was sent to “701 South 3, Van Burén, Arkansas (where I have never resided) on July 5,10, and 20, 2012[.]” Montrevel also alleged in his brief that U.S. Bank was not authorized to do business in Arkansas. ..

, On December 7, 2012, the court suspended the sale of the home until the matter could be settled. The circuit court held a hearing on April 29, 2015. At the hearing, counsel for Montrevel argued that service was not properly made; therefore, the order of foreclosure was void.- The circuit court found that the service was proper and denied the motion to dismiss.

LMontrevel filed a motion for reconsideration on May 1, '2015, that was denied on May 22, 2015. Montrevel filed a timely notice of appeal.

Montrevel raises two points on appeal. First, he asserts that the default judgment should be set aside as void for lack of proper service; second, he argues that U.S. Bank is not authorized to ■ do business in Arkansas. We agree that the default judgment was void for lack of service, and we reverse and remand.

In cases involving an appeal of the grant or denial of a motion to set aside a default judgment, our standard of review depends on the grounds upon which the appellant is claiming the default judgment should be set aside. Scott v. Wolfe, 2011 Ark. App. 438, at 6, 384 S.W.3d 609, 612. Ordinarily, this court applies an abuse-of-discretion standard; however, in cases where the appellant claims that the default judgment is void, .the matter is a question of law, which we review de novo and give no deference to the circuit court’s ruling. Id.

As we have long held, statutory-service requirements, being in derogation of the common law, are strictly construed and compliance must be exact. XTO Energy, Inc. v. Thacker, 2015 Ark. App. 203, at 8, 467 S.W.3d 161, 167. This rule applies equally to the service requirements imposed by rules of the court. Id. at 8-9; Rule 4(f)(1) of the Arkansas Rules of Civil Procedure provides that, if it appears by the affidavit of a party seeking judgment or his attorney that, after diligent inquiry, the whereabouts of a defendant remains unknown, service shall be by warning- order issued by the clerk. Scott, 2011 Ark. App. 438, at 7, 384 S.W.3d 609. A mere recitation in an affidavit that a diligent inquiry was made is not sufficient. See, e.g., Smith v. Edwards, 279 Ark. 79, 648 S.W.2d 482 (1983). The burden is on the moving | sparty seeking constructive service by warning order to demonstrate to the court that he actually attempted to locate the defendant. Ark. R. Civ. P. 4(f); XTO, supra.

In XTO, 2016 Ark. App. 203, at 9-10, 467 S.W.3d 161, our court made it very clear that reciting the words “diligent inquiry” in an affidavit for a warning order is insufficient to show that a diligent inquiry actually occurred:

Simply stated, the affidavit for warning order in the 1984 case was insufficient because it was conclusory, containing no indication of what steps were taken as part of the required “diligent inquiry” as to the whereabouts of N.H. Tarver or his heirs.

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Bluebook (online)
2016 Ark. App. 134, 484 S.W.3d 715, 2016 Ark. App. LEXIS 149, Counsel Stack Legal Research, https://law.counselstack.com/opinion/billings-v-us-bank-national-assn-arkctapp-2016.