Federal Home Loan v. Petty

2013 MT 91N

• Court: Montana Supreme Court
• Decided: April 9, 2013
• Docket: 12-0445
• Status: Published

Opinion

April 9 2013

DA 12-0445

IN THE SUPREME COURT OF THE STATE OF MONTANA

2013 MT 91N

FEDERAL HOME LOAN MORTGAGE CORPORATION,

Plaintiff and Appellee,

v.

JEFFREY S. PETTY and MEGAN A. PETTY,

Defendants and Appellants.

APPEAL FROM: District Court of the Eleventh Judicial District, In and For the County of Flathead, Cause No. DV-11-1313C Honorable Stewart E. Stadler, Presiding Judge

COUNSEL OF RECORD:

For Appellant:

Timothy Baldwin, Lerner Law Firm, Kalispell, Montana

For Appellee:

Cassie R. Dellwo, Mackoff Kellogg Law Firm, Dickinson, North Dakota

Submitted on Briefs: March 20, 2013

Decided: April 9, 2013

Filed:

__________________________________________ Clerk Justice Laurie McKinnon delivered the Opinion of the Court.

¶1 Pursuant to Section I, Paragraph 3(d), Montana Supreme Court Internal Operating

Rules, this case is decided by memorandum opinion and shall not be cited and does not

serve as precedent. Its case title, cause number, and disposition shall be included in this

Court’s quarterly list of noncitable cases published in the Pacific Reporter and Montana

Reports.

¶2 Defendants Jeffrey S. Petty and Megan A. Petty appeal a decision of the Eleventh

Judicial District Court, Flathead County, granting summary judgment to Plaintiff Federal

Home Loan Mortgage Corporation (“Freddie Mac”). We affirm.

¶3 The Pettys executed a deed of trust on February 21, 2007, encumbering a tract of

real property in Marion, Montana. The original beneficiary of the deed of trust,

Mortgage Electronic Registration Systems, Inc., assigned its interest to BAC Home

Loans Servicing, LP FKA Countrywide Home Loans Servicing LP (“BAC”), pursuant to

an assignment of deed of trust executed December 18, 2009. Thereafter, BAC appointed

ReconTrust Company, N.A., as substitute trustee.

¶4 The Pettys defaulted on their obligations under the deed of trust as stated in the

Notice of Trustee’s Sale dated December 17, 2010. ReconTrust thereupon initiated a

trustee’s sale, which was held May 3, 2011. BAC was the purchaser at the sale. On

May 5, 2011, BAC conveyed the subject property by warranty deed to Freddie Mac.

¶5 The Pettys remained on the property after the trustee’s sale. As a result, Freddie

Mac served the Pettys a Notice to Quit on July 19, 2011, advising the Pettys that the

tenancy under which they remained on the property would not be renewed and that they

2 were required to quit and deliver possession of the property to Freddie Mac within

thirty days. The Pettys refused to vacate. Freddie Mac served the Pettys a second Notice

to Quit on October 3, 2011, stating that the Pettys’ tenancy had ended on August 19 and

that they had three days to vacate the property. Still, the Pettys refused to vacate.

¶6 As a result, Freddie Mac initiated the instant unlawful detainer action against the

Pettys on October 24, 2011. Following oral argument on June 5, 2012, the District Court

granted Freddie Mac’s motion for summary judgment under M. R. Civ. P. 56(c), thus

rendering other pending motions moot. Citing § 71-1-319, MCA, the court determined

that Freddie Mac, as the successor in interest to the purchaser at the trustee’s sale, was

entitled to possession of the subject property on May 15, 2011. The court observed that

Freddie Mac had offered proof in support of its allegations, which the Pettys had not

rebutted. Furthermore, the court concluded that the Pettys had failed to properly plead

constructive fraud. After finding that notice and process were complete and that there

were no genuine issues of material fact, the District Court determined that Freddie Mac

was entitled to judgment as a matter of law.

¶7 The Pettys contend on appeal that the District Court erred in granting summary

judgment in favor of Freddie Mac. We disagree. Pursuant to § 71-1-319, MCA, Freddie

Mac was entitled to possession of the subject property as the successor to the purchaser at

the trustee’s sale. Montana’s unlawful detainer statutes require a thirty-day notice to quit,

§ 70-27-104, MCA, and a three-day notice of reentry, § 70-27-106, MCA. Freddie Mac

gave both notices prior to filing this unlawful detainer action. The Pettys continued to

occupy and possess the property. Based on the record before us, it is clear that Freddie

3 Mac complied with the applicable provisions of law and is the owner of the property.

The Pettys have presented no evidence suggesting that there are genuine disputes as to

any material issues of fact. Furthermore, we agree with the District Court that the Pettys

failed to properly plead fraud pursuant to M. R. Civ. P. 9(b). Accordingly, the District

Court correctly granted summary judgment to Freddie Mac.

¶8 We have determined to decide this case pursuant to Section I, Paragraph 3(d) of

our Internal Operating Rules, which provides for noncitable memorandum opinions. The

issues in this case are legal and are controlled by settled Montana law, which the District

Court correctly applied.

¶9 Affirmed.

/S/ LAURIE McKINNON

We Concur:

/S/ MIKE McGRATH /S/ PATRICIA COTTER /S/ MICHAEL E WHEAT /S/ JIM RICE