Kelley v. Ocwen Loan Servicing, LLC (In re Bowers)

595 B.R. 869
CourtUnited States Bankruptcy Court, M.D. Georgia
DecidedDecember 26, 2018
DocketBankruptcy Case No. 18-70224-JTL; Adversary Proceeding No. 18-07006
StatusPublished
Cited by2 cases

This text of 595 B.R. 869 (Kelley v. Ocwen Loan Servicing, LLC (In re Bowers)) is published on Counsel Stack Legal Research, covering United States Bankruptcy Court, M.D. Georgia primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Kelley v. Ocwen Loan Servicing, LLC (In re Bowers), 595 B.R. 869 (Ga. 2018).

Opinion

John T. Laney, III, United States Bankruptcy Judge

In this adversary proceeding, Walter Kelley, the Chapter 7 Trustee ("the Trustee"), seeks an order determining the enforceability of a security interest that encumbers the Debtor's real property in Thomas County, Georgia. (Compl., A.P. No. 1). The Trustee argues that, because he may claim the interest of a bona fide purchaser pursuant to 11 U.S.C. § 544(a)(3), his interest in the property is free and clear of the security deed currently held by Deutsche Bank National Trustee Company ("DBNT"). (Id.) The Defendant, a servicer for DBNT,1 filed an answer disputing the Trustee's claim. (Answer, A.P. No. 7). The answer further sought a declaration that the security interest is enforceable or alternatively, for equitable recognition of the interest by subrogation or reinstatement. (Id.)

The parties filed cross-motions for summary judgment. (Pl.'s Mot. for Summ. J., A.P. No. 17; Def.'s Mot. for Summ. J., A.P. No. 28). The motions raised two issues. First, whether a hypothetical purchaser is deemed to have notice that, despite the recordation of two instruments canceling a security deed, a security interest encumbered the Debtor's real property. If not, the Court must address whether DBNT is entitled to an equitable recognition of its lien.

The Court heard the cross-summary judgment motions and, after the parties presented their arguments and the record in this case, the Court took the matter under advisement. Having carefully considered the issue before it, the Court concludes there is no issue of material fact and grants summary judgment in favor of the Plaintiff.2

I. SUMMARY JUDGMENT STANDARD

Federal Rule of Civil Procedure 56, made applicable to this proceeding by Federal Rule of Bankruptcy Procedure 7056, states that a court may grant summary judgment "if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." In making this determination, this Court must "resolve all reasonable doubts about the facts in [the non-moving party's] favor." Info. Sys. & Networks Corp. v. City of Atlanta , 281 F.3d 1220, 1224 (11th Cir. 2002). Further, the Court must draw "all justifiable inferences" in the non-moving party's favor. Anderson v. Liberty Lobby, Inc. , 477 U.S. 242, 256, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986).

*873An issue of fact is material if it affects the outcome of the case as identified by substantive law. Anderson , 477 U.S. at 248, 106 S.Ct. 2505 ; Redwing Carriers, Inc. v. Saraland Apartments , 94 F.3d 1489, 1496 (11th Cir. 1996). Therefore, the Court will focus its analysis solely on factual contentions that are relevant and necessary to the outcome of the case. A genuine dispute exists if a reasonable fact finder could find in favor of the non-moving party based on the evidence. Anderson , 477 U.S. at 248, 106 S.Ct. 2505. A genuine dispute means that more than "some metaphysical doubt [exists] as to the material facts." Matsushita Elec. Indus. Co. v. Zenith Radio Corp. , 475 U.S. 574, 586, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986).

Between DBNT's admissions in its Answer and the parties' statements and replies concerning material facts, the parties largely agree on the material facts. Of the disputed facts, they are either unsupported by the record3 or are irrelevant or unnecessary to the outcome of this case. As such, the Court finds the issues before it are legal in nature and the case is suited for summary judgment.

II. FACTS IN THE RECORD

Prior to filing this case, the Debtor purchased real estate in Thomas County, Georgia. (Compl. ¶ 7, A.P. No. 1). In 2006, the Debtor granted Option One Mortgage ("Option One") a security deed, which was recorded in the Thomas County real estate records on March 1, 2006 ("the Security Deed"). (Id. ¶ 8). On August 4, 2008, a Satisfaction of Mortgage was recorded that referenced the Security Deed ("the 2008 Satisfaction"). (Id. ¶ 9). The 2008 Satisfaction stated that the Security Deed had been paid in full and that the undersigned was the present owner of the referenced security interest by virtue of assignment or devise from Option One. (Id. Ex. B). The document, however, was not signed by agents of Option One; instead, the undersigned signed as assistant secretaries of H & R Block Bank ("H & R Block"). (Id.) On August 11, 2009-a little over one-year later, another Satisfaction of Mortgage was recorded that again referenced the Security Deed ("the 2009 Satisfaction"). (Id. ¶ 10). Like the prior instrument, the 2009 Satisfaction stated the Security Deed had been paid in full and that the undersigned was the present holder of the Security Deed. And again, the document was signed by assistant secretaries of H & R

*874Block (the 2008 Satisfaction and 2009 Satisfaction will be referenced collectively as "the Satisfactions"). (Id. Ex. C).

The Thomas County title records do not reflect H & R Block ever had a recorded interest in the Debtor's property. (Def.'s Stmnt. of Uncontested Facts ¶ 12). DBNT asserts that the Satisfactions were recorded in error. (Id. ¶ 16).

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Bluebook (online)
595 B.R. 869, Counsel Stack Legal Research, https://law.counselstack.com/opinion/kelley-v-ocwen-loan-servicing-llc-in-re-bowers-gamb-2018.