                                                                                            06/27/2017


                                            DA 16-0566
                                                                                        Case Number: DA 16-0566

                  IN THE SUPREME COURT OF THE STATE OF MONTANA

                                           2017 MT 160N



FEDERAL NATIONAL MORTGAGE ASSOCIATION,

              Plaintiff and Appellee,

         v.

ANTHONY R. CHAPMAN,
CHRISTINE M. LAKE-CHAPMAN,
and any person in possession,

              Defendants and Appellants.



APPEAL FROM:            District Court of the Eighteenth Judicial District,
                        In and For the County of Gallatin, Cause No. DV-15-599A
                        Honorable Holly Brown, Presiding Judge


COUNSEL OF RECORD:

                For Appellants:

                        Anthony R. Chapman and Christine Chapman, Self-Represented,
                        Manhattan, Montana

                For Appellee:

                        Charles E. Hansberry, Jenny M. Jourdonnais, Hansberry & Jourdonnais,
                        PLLC, Missoula, Montana



                                                    Submitted on Briefs: May 17, 2017
                                                               Decided: June 27, 2017


Filed:

                        __________________________________________
                                          Clerk
Justice Michael E Wheat delivered the Opinion of the Court.


¶1     Pursuant to Section I, Paragraph 3(c), 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     In 2004, the Chapmans executed a Deed of Trust (Deed) conveying their Manhattan,

Montana, real property as security for a GMAC mortgage loan. In September 2011, the

Chapmans stopped making payments on the loan but continued living on the property. In

September 2014, a non-judicial foreclosure proceeding was initiated and a January 27,

2015 Trustee’s Sale was noticed. In January 2015, the Chapmans filed several documents

in the real property records, including a Notice to Rescind (Notice). In this Notice, they

claimed they were rescinding their Deed based upon the failure of relevant entities to

comply with the disclosure requirements of the Truth in Lending Act, 15 U.S.C. § 1601 et

seq. As scheduled, three weeks later, the property was sold in a Trustee’s Sale. A servicing

corporation purchased the property and three months later conveyed it to the Federal

National Mortgage Association (Fannie Mae or the Association). Fannie Mae notified the

Chapmans to vacate and when they refused, initiated the underlying unlawful detainer

action against them in June 2015.

¶3     In July 2016, the Eighteenth Judicial District Court, Gallatin County, ruled that the

Chapmans’ Notice to Rescind was untimely and therefore ineffective. In August 2016, the


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court granted Fannie Mae’s motion for summary judgment, and ten days later, denied the

Chapmans’ M. R. Civ. P. 60(b)(4) (Rule 60(b)) motion to vacate the judgment. It is from

these orders the Chapmans appeal.

¶4     As in all lower court proceedings, the Chapmans, who represented themselves

throughout the proceeding, including this appeal, maintain that their Notice to Rescind was

effective and nullified the need for all subsequent proceedings. While relying on the

provisions of the Truth in Lending Act that authorize a borrower to rescind a deed under

certain circumstances, 15 U.S.C. § 1635(a) and (b), they fail to accept the application of 15

U.S.C. § 1635(f) to their Notice. As noted by the District Court, 15 U.S.C. § 1635(f) states

that a borrower’s “right to rescission shall expire three years after the date of consummation

of the transaction or upon the sale of the property, whichever occurs first . . . .” The

Chapmans executed the Deed in May 2004. Under the applicable statute, their right to file

a Notice to Rescind existed until May 2007, at which time that right extinguished. The

Chapmans did not file their Notice to Rescind until January 2015.

¶5     The District Court did not err in concluding the Chapmans’ Notice to Rescind was

untimely and ineffective. The law is clear. Furthermore, the Chapmans’ reliance on

Jesinoski v. Countrywide Home Loans, Inc., ___ U.S. ___, 135 S. Ct. 790 (2015) is

misplaced. In that case, the notice to rescind was filed within the statutorily-required

limitations period.

¶6     Moreover, the District Court correctly granted summary judgment to Fannie Mae in

the underlying unlawful detainer action. Once the court declared rescission ineffective,

there was no dispute vis-à-vis Fannie Mae’s right of possession. The record reveals there

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were no genuine issues of fact regarding the validity of the foreclosure proceeding and the

sale. It further reflects that Fannie Mae obtained legal title to the property and complied

with the applicable statutes (Title 70, chapter 27, MCA) when requesting that the

Chapmans vacate the property. As the material facts were undisputed and Fannie Mae was

entitled to judgment as a matter of law, we affirm the District Court’s grant of Fannie Mae’s

motion for summary judgment.

¶7     We further affirm the District Court’s denial of the Chapmans’ Rule 60(b)(4)

motion. The court correctly determined that the Chapmans’ motion was a rehashing of

their “rescission-is-effective” argument and that “[s]uch repetitive arguments are

insufficient on which to grant relief under Rule 60(b), M. R. Civ. P.” The court’s analysis

and reasoning are sound and we will not disturb it.

¶8     Lastly, we decline to address the Chapmans’ challenge to the District Court’s

subject matter jurisdiction as it is without merit.

¶9     We have determined to decide this case pursuant to Section I, Paragraph 3(c) of our

Internal Operating Rules, which provides for memorandum opinions. In the opinion of the

Court, the District Court’s findings of fact are not clearly erroneous, its interpretation and

application of the law were correct and its ruling was not an abuse of discretion.

¶10    Affirmed.



                                                      /S/ MICHAEL E WHEAT




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We Concur:

/S/ DIRK M. SANDEFUR
/S/ JAMES JEREMIAH SHEA
/S/ BETH BAKER
/S/ JIM RICE




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