the Houston OMNI USA Co., Inc. and Gary B. Wade, Sr. v. Southtrust Bank Corporation NA Wachovia as Trustee Its Successors and Assigns Buckeye Retirement Co., LLC and as Substitute Trustee Mark Tormey of Tormey & Associates

CourtCourt of Appeals of Texas
DecidedApril 30, 2009
Docket01-07-00433-CV
StatusPublished

This text of the Houston OMNI USA Co., Inc. and Gary B. Wade, Sr. v. Southtrust Bank Corporation NA Wachovia as Trustee Its Successors and Assigns Buckeye Retirement Co., LLC and as Substitute Trustee Mark Tormey of Tormey & Associates (the Houston OMNI USA Co., Inc. and Gary B. Wade, Sr. v. Southtrust Bank Corporation NA Wachovia as Trustee Its Successors and Assigns Buckeye Retirement Co., LLC and as Substitute Trustee Mark Tormey of Tormey & Associates) is published on Counsel Stack Legal Research, covering Court of Appeals of Texas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

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the Houston OMNI USA Co., Inc. and Gary B. Wade, Sr. v. Southtrust Bank Corporation NA Wachovia as Trustee Its Successors and Assigns Buckeye Retirement Co., LLC and as Substitute Trustee Mark Tormey of Tormey & Associates, (Tex. Ct. App. 2009).

Opinion

Opinion issued April 30, 2009







In The

Court of Appeals

For The

First District of Texas





NO. 01-07-00433-CV





THE HOUSTON OMNI USA CO., INC., AND GARY B. WADE, SR., Appellants


V.


SOUTHTRUST BANK CORPORATION, N.A., WACHOVIA AS TRUSTEE, ITS SUCCESSORS AND ASSIGNS, BUCKEYE RETIREMENT CO., L.L.C., AND AS SUBSTITUTE TRUSTEE, MARK TORMEY OF TORMEY & ASSOCIATES, Appellees





On Appeal from the 80th District Court

Harris County, Texas

Trial Court Cause No. 2005-37046





MEMORANDUM OPINION


          Appellants, The Houston Omni USA Co., Inc., and Gary B. Wade, Sr. (collectively, “Omni”), sued appellees, SouthTrust Bank Corporation, N.A., and Wachovia, as trustee, its successors and assigns; and Mark Tormey of Tormey & Associates, as substitute trustee, for wrongful foreclosure. In addition, Omni sued appellee, Buckeye Retirement Co., L.L.C., for trespass to try title.

          SouthTrust and Wachovia moved for summary judgment as to Omni’s wrongful foreclosure claim. The 215th District Court granted a no-evidence summary judgment in favor of SouthTrust and denied summary judgment for Wachovia. The trial court denied Omni’s motion for summary judgment as to Buckeye’s status as a bona fide purchaser.

          The case was transferred to the 80th District Court for trial on Omni’s wrongful foreclosure claim against Wachovia and Omni’s trespass to try title claim against Buckeye. During a pre-trial conference, the 80th District Court reconsidered and granted Wachovia’s motion for summary judgment. In addition, the court granted Buckeye’s motion for summary judgment as to Omni’s trespass to try title claim.

          On appeal, Omni presents four issues. In its first and second issues, Omni contends that the trial court erred by granting summary judgment on its wrongful foreclosure claim in favor of SouthTrust and Wachovia because notice of foreclosure failed to comply with Texas Property Code section 51.002. In its third issue, Omni contends that the trial court erred by granting summary judgment on its wrongful foreclosure claim in favor of Wachovia because Wachovia failed to properly challenge the capacity in which it was sued under Texas Rule of Civil Procedure 93. In its fourth issue, Omni contends that the trial court erred by denying its motion for summary judgment as to Buckeye’s status as bona fide purchaser.

          We affirm.

Summary of Facts and Procedural History

          In October 2002, Omni and SouthTrust entered into a construction loan agreement and note, pursuant to which SouthTrust loaned $600,000 to Omni for improvements to Omni’s commercial property located at 1909 Scott Street in Houston (“Property”). The note was secured by a deed of trust, which was recorded with the Harris County clerk. Omni’s president, Gary Wade, executed a personal guaranty.

          Pursuant to the terms of the deed of trust, upon the occurrence of a default by Omni, SouthTrust was authorized to dispose of the Property by non-judicial foreclosure sale. The deed of trust states that SouthTrust was required to give notice to Omni of such proposed sale by certified mail “at least 21 days preceding the date of the sale” and that

[s]ervice of such notice shall be completed upon deposit of the notice, enclosed in a postpaid wrapper, properly addressed to [Omni] . . . at [its] most recent address as shown by the records of [SouthTrust], in a [USPS depository]. . . . [Omni] agrees that no notice of any sale other than as set out in this paragraph need be given by the Trustee, [SouthTrust], or any other person. [Omni] designates as [Omni’s] address for the purposes of such notice, the address set out below opposite [Omni’s] signature.

The deed of trust reflects that the address “opposite [Omni’s] signature” is: “1909 Scott Street, Houston, TX ,77045.” The same address is reflected adjacent to Omni’s signature in the loan agreement and the note.

          In April and July 2003, after delays in construction occurred, Omni and SouthTrust executed modification and extension agreements, and SouthTrust loaned to Omni an addition $78,000. In each extension agreement, Omni again listed its address as 1909 Scott Street, Houston, Texas,77045, and Wade listed his address as 2646 Dawn Star, Missouri City, Texas 77489.

          In early 2004, Omni defaulted on its obligation to make payments to SouthTrust on the $678,000 note. On February 3, 2004, the parties executed a “Change in Terms Agreement,” extending the interest-only period to April 10, 2004 and then resuming payments on the principal. The agreement states, “All other terms and conditions shall remain the same.” The borrower block of the agreement lists Omni’s address as 1909 Scott Street, Houston, Texas, 77003.

          On April 8, 2004, after Omni had defaulted on the interest payments, SouthTrust accelerated the note and appointed Mark Tormey, as substitute trustee, to post the Property for foreclosure sale on May 4, 2004. On April 30, 2004, Omni filed bankruptcy, staying the sale. On September 30, 2004, the bankruptcy court lifted the stay through an agreed order, pursuant to which SouthTrust would be permitted to foreclose on the Property unless Omni fulfilled certain conditions. On November 15, 2004, after Omni had failed to fulfill the conditions, SouthTrust sent notice to Omni at the address listed in the deed of trust, 1909 Scott Street, Houston, Texas, 77045, of its intent to conduct a foreclosure sale on December 7, 2004.

          Just prior to the December 7th sale, Omni notified SouthTrust that it had found a lender to refinance the Property. The parties agreed that SouthTrust would pass on the December 7th sale to allow time to assemble the refinance, but would otherwise move forward with posting the Property for a January 2004 foreclosure sale, in the event that the refinancing did not materialize. On December 13, 2004, SouthTrust, through Tormey, again sent to Omni and Wade, by certified mail to the address listed in the deed of trust, 1909 Scott Street, Houston, Texas,77045, and the guaranty agreement, 2646 Dawn Star, Missouri City, Texas 77489, that the sale was re-posted for foreclosure sale on January 4, 2005.

          On January 4, 2005, after the refinancing failed to materialize, the foreclosure sale proceeded, and SouthTrust purchased the Property.

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