                                                                                           ACCEPTED
                                                                                       03-15-00339-CV
                                                                                               8148372
                                                                            THIRD COURT OF APPEALS
                                                                                       AUSTIN, TEXAS
                                                                                  12/8/2015 6:42:20 PM
                                                                                     JEFFREY D. KYLE
                                                                                                CLERK
                            NO. 03-15-00339-CV

                                                                 FILED IN
                  IN THE THIRD COURT OF APPEALS 3rd COURT OF APPEALS
                         AT AUSTIN, TEXAS           AUSTIN, TEXAS
                                                           12/8/2015 6:42:20 PM
                                                             JEFFREY D. KYLE
                                                                   Clerk
                              BEN MELTON,
                                                           APPELLANT,

                                     v.

  CU MEMBERS MORTGAGE, A DIVISION OF COLONIAL SAVINGS,
       F.A., FIRST WESTERN TITLE CO., AND BOB MIMS,
                                              APPELLEES.


                Appeal from the 340th Judicial District Court
                         Tom Green County, Texas
                     Trial Court Cause No. C130102
                     Hon. Jay Weatherby, Presiding

 BRIEF OF APPELLEES CU MEMBERS MORTGAGE, A DIVISION OF
    COLONIAL SAVINGS, FA AND FIRST AMERICAN TITLE CO.


                                   Mark D. Cronenwett
                                   SBN 00787303
                                   Mackie Wolf Zientz & Mann, P.C.
                                   14160 N. Dallas Parkway, Suite 900
                                   Dallas, Texas 75254
                                   (214) 635-2670 (Telephone)
                                   (214) 635-2686 (Facsimile)
                                   mcronenwett@mwzmlaw.com
                                   Attorneys for Appellees CU Members
                                   Mortgage, a Division of Colonial Savings,
                                   FA and First American Title Co.

Oral Argument
Conditionally Requested
                   IDENTITY OF PARTIES AND COUNSEL
      Appellees CU Members Mortgage, a Division of Colonial Savings, FA

(hereafter “Colonial”) and First American Title Co. (“First American”) (Colonial

and First American are hereafter referred to collectively as “Appellees”) agree with

Appellant Ben Melton’s (hereafter “Melton” or Appellant”) Identity of Parties and

Counsel, except to add that that there are two additional parties to this appeal, as

indicated below:

      Appellees James C. Mosser and Mosser Law PLLC:

            Counsel in the Court of Appeals:
                 James C. Mosser
                 SBN 00789784
                 Nicholas D. Mosser
                 SBN 24075405
                 Paul J. Downey
                 SBN 24080659
                 Mosser Law PLLC
                 2805 Dallas Parkway, Suite 220
                 Plano, Texas 75093

            Counsel in the Trial Court:
                 James C. Mosser
                 SBN 00789784
                 Mosser Law PLLC
                 2805 Dallas Parkway, Suite 220
                 Plano, Texas 75093




                                         ii
                                           TABLE OF CONTENTS
Identity of Parties and Counsel ................................................................................. ii

Table of Contents ..................................................................................................... iii
Index of Authorities ..................................................................................................iv

Statement of the Case.............................................................................................. vii

Statement Regarding Oral Argument ..................................................................... vii
Statement of the Issues Presented .......................................................................... viii
Statement of the Facts ................................................................................................ 1
Summary of the Argument......................................................................................... 5
Standard of Review .................................................................................................... 5
Argument and Authorities.......................................................................................... 6

I.       Summary judgment was warranted because Appellant failed to
         exercise due diligence in serving his suit. ....................................................... 6
II.      Four-year limitations period applies to Melton’s claims............................... 13
III.     Colonial has standing as both Mortgage Servicer and Mortgagee of
         Record. ........................................................................................................... 14
IV.      Trial Court properly awarded attorney’s fees................................................ 17
Prayer ....................................................................................................................... 17
Certificate of Service ............................................................................................... 18

Certificate of Compliance with Rule 32(A)............................................................. 19




                                                              iii
                                       INDEX OF AUTHORITIES

CASES
Boutari v. JP Morgan Chase Bank, NA, No. 5:09cv608, 2010 U.S.
     Dist. LEXIS 144094, *35-36 (W.D. Tex., June 10, 2010), aff’d
     429 Fed. Appx. 407 (5th Cir., June 20, 2011) ..................................................6

Broom v. MacMaster, 992 S.W.2d 659, 664-65 (Tex. App.—Dallas
     1999, no pet.) .................................................................................................12

Farkas v. GMAC Mortg., LLC, 737 F.3d 338, 342 (5th Cir. 2013).........................16
Gant v. DeLeon, 786 S.W.2d 259, 260 (Tex. 1990) ..................................................8
Hoehn v. Dallas County Mental Health & Mental Retardation Ctr.,
     No. 05-94-01515-CV, 1995 Tex. App. LEXIS 3406, 1995 WL
     500271, at *3 (Tex. App.—Dallas Aug. 16, 1995, no writ) ..........................10

In re Estate of Hardesty, 449 S.W.3d 895, 911-12 (Tex. App.—
       Texarkana 2014, no pet.) ...........................................................................6, 14
Johnson v. City of Fort Worth, No. 2-08-369-CV, 2009 Tex. App.
     LEXIS 2124 *9 (Tex. App.—Fort Worth Mar. 26, 2009, no
     pet.) ................................................................................................................11
Kyle v. Strasburger, No. 13-13-00609-CV, 2015 WL 7567523, *3-5,
      2015 Tex. App. LEXIS 11984, *10-12 (Tex. App.—Corpus
      Christi Nov. 25, 2015, no pet. h.) ..............................................................6, 14
Mauricio v. Castro, 287 S.W.3d 476, 478 (Tex. App.—Dallas 2009,
     no pet.) .............................................................................................................9

McCord v. Dodds, 69 S.W.3d 230, 234 (Tex. App.—Corpus Christi
    2001, pet denied) .............................................................................................9

Murray v. San Jacinto Agency, Inc., 800 S.W.2d 826, 830 (Tex. 1990)...................7
Paredes v. City of Odessa, 128 F. Supp. 2d 1009, 1018 (W.D. Tex.
     2000) ................................................................................................................7

Priester v. JP Morgan Chase Bank, N.A., 708 F.3d 667, 674 (5th Cir.
      2013) ................................................................................................... 6, 12, 13

                                                             iv
Proulx v. Wells, 235 S.W.3d 213, 215 (Tex. 2007) ...................................................7

Puig v. Citibank, N.A., Civil Action No. 3:11-CV-0270-L, 2012 U.S.
      Dist. LEXIS 70398, 2012 WL 1835721, at *15 (N.D. Tex. May
      21, 2012) ........................................................................................................11

Ragsdale v. Progressive Voters League, 801 S.W.2d 880, 882 (Tex.
     1990) ..............................................................................................................16

Roberts v. Padre Island Brewing Co., 28 S.W.3d 618, 622 (Tex.
     App.—Corpus Christi 2000, pet. denied .........................................................8

Rodriguez v. Tinsman & Houser, Inc., 13 S.W.3d 47 (Tex. App.—San
      Antonio 1999, pet. denied) ..........................................................................8, 9

Santiago v. Novastar Mortg., Inc., 443 S.W.3d 462, 469-70 (Tex.
      App.—Dallas 2014, pet. denied) ...............................................................6, 14
Schanzle v. JPMC Specialty Mortg. LLC, No. 03-09-00639-CV, 2011
     WL 832170, *4, 2011 Tex. App. LEXIS 1748, *10-11 (Tex.
     App.—Austin March 11, 2011, no pet.) ......................................................6, 7
Tapia v. CitiMortgage, Inc., No. A-14-CA-135-SS, 2014 U.S. Dist.
      LEXIS 47624 *5-6 (W.D. Tex. Apr. 7, 2014)...............................................16

Valence Operating Co. v. Dorsett,
      164 S.W.3d 656 (Tex. 2005) ...........................................................................5
Washmon v. Strickland, No. 03-08-00372-CV, 2010 Tex. App. LEXIS
    1366, *6 (Tex. App.— Austin Feb. 26, 2010, no pet.) ........................... 14, 15

Wells Fargo Bank, N.A. v. Leath, 425 S.W.3d 525, 532 (Tex. App.—
      Dallas 2014, pet. denied) ...............................................................................11

Williams v. Wachovia Mortg. Corp., 407 S.W.3d 391, 396-97 (Tex.
      App.—Dallas 2013, pet. denied) ........................................................ 6, 12, 14
Wood v. HSBC Bank USA, N.A., 439 S.W.3d 585, 590-92 (Tex.
     App.—Houston [14th Dist.] 2014, pet. pending) ......................................6, 14

STATUTES
TEX. BUS. & COM. CODE ANN. § 17.505(b) .............................................................11

                                                            v
TEX. BUS. & COM. CODE ANN. § 17.565 ....................................................................6

TEX. CIV. PRAC. & REM. CODE § 16.004(a)(4) ..........................................................6

TEX. CIV. PRAC. & REM. CODE § 16.051....................................................................5

TEX. CIV. PRAC. & REM. CODE ANN. § 74.051(c) ....................................................11

TEX. CONST. art. XVI, § 50(a)(6) .........................................................................9, 10

TEX. CONST. art. XVI, §50(a)(6)(Q)(x) ....................................................................11
TEX. PROP. CODE ANN. § 51.0001(4)(C)........................................................... 14, 15
TEX. PROP. CODE ANN. § 51.0025 ............................................................................13

RULES
TEX. R. CIV. P. 166 ....................................................................................................4
TEX. R. CIV. P. 166a(c) ..............................................................................................4




                                                           vi
                         STATEMENT OF THE CASE
      Appellees agree with Appellant’s Statement of the Case.




              STATEMENT REGARDING ORAL ARGUMENT
      Oral argument is not warranted in this case. The judgment is premised on a

summary judgment involving limitations issues that have previously been resolved

by this Court and the other Texas appellate courts that have considered the issue.

Appellees do not believe that oral argument will significantly impact the decisional

process of the Court. If, however, the Court believes oral argument would be

helpful and oral argument is held, Appellees desire to participate therein.




                                         vii
                STATEMENT OF THE ISSUES PRESENTED
Issue 1.     Summary judgment was warranted on Appellant’s claims because he
filed his lawsuit on the last day of the limitations but then waited sixty days to file
suit. As Appellant had no reason to wait for affecting service, he failed to exercise
due diligence as a matter of law.

Issue 2.     Texas law is clear that a four-year limitations period applies to claims
for defects in the origination of a Texas home equity loan; therefore, Appellant’s
argument that no limitations period governs his claims is unfounded as a matter of
law.

Issue 3.     Colonial has standing to pursue foreclosure of the subject home-
equity loan agreement as Colonial is both a Mortgage Servicer and a Mortgagee as
provided in the Texas Property Code.

Issue 4.     The Trial Court properly awarded attorney’s fees.




                                         viii
                        STATEMENT OF THE FACTS
      This case involves a dispute over a loan taken out by Appellant Ben Melton

(hereafter “Melton” or “Appellant”) and secured by the equity in his primary

residence. On March 13, 2009, Melton signed and entered a Texas Home Equity

Note (Fixed Rate – First Lien) (the “Note”) for a $223,648.00 loan. CR at 71. On

that same date, he also signed a Texas Home Equity Security Instrument (First

Lien) (the “Security Instrument”) (the Note and Security Instrument will hereafter

be referred to collectively as the “Loan Agreement”) that secured the Note with a

lien on Melton’s residence located at 1969 Beaty Road, San Angelo, Texas 76904,

and more specifically described as:

      LOT FOURTEEN-A (14-A), BLOCK ONE (1), OF SECTION TWO (2),
      GROUP 1, LAKE NASWORTHY ADDITION TO THE CITY OF SAN
      ANGELO, TOM GREEN COUNTY, TEXAS, ACCORDING TO THE
      PLAT THEREOF RECORDED IN CABINET "E", SLIDE #167, OF THE
      PLAT RECORDS OF TOM GREEN COUNTY, TEXAS (the “Property”).
      CR at 78.

      The original lender on the Note was Appellee CU Members Mortgage, a

Division of Colonial Savings, FA (hereafter “Colonial”). CR at 71. The Note was

later assigned to the Federal Home Loan Mortgage Corporation (“Freddie Mac”),

which retained Colonial as its Mortgage Servicer. CR at 64-66.

      Four years to the day after Melton closed the Loan Agreement, a time in

which he was in default on his loan payments, he filed suit against Colonial,


                                        1
among others, for alleged violations of the Texas Constitution in connection with

the origination of his loan. CR at 6. In particular, Melton alleged that article 16,

section 50(a)(6) of the Constitution was violated in the following respects: (a) that

Colonial failed to provide Melton with a Notice Concerning Extensions of Credit

within twelve days of the closing on his loan; (b) that Colonial closed Melton’s

home equity loan with a principal amount that exceeded an amount, when added to

the principal balances of all other liens, 80 percent of the fair market value of the

home; (c) that Colonial closed Melton’s home equity loan with recourse for

personal liability; (d) that Colonial required Melton to apply the proceeds of his

home equity loan to another debt not secured by his home; (e) that Colonial failed

to provide a copy of Melton’s final executed loan application and all executed

documents Melton signed at closing and failed to cure this notice obligation in a

timely manner; and (f) that Colonial failed to provide the true fair market value of

Melton’s home on the date the loan closed. CR 7-8. For these alleged loan-

origination defects, Melton brought a claim for a forfeiture of the Loan Agreement,

a claim Declaratory Judgment that the Loan Agreement was void ab initio, and a

claim for statutory fraud under Section 27.01 of the Texas Business and Commerce

Code. CR at 8-9.

      In response, Appellees on May 31, 2013 filed their Original Answer,

wherein they generally denied Melton’s claims and, among other things, asserted



                                         2
the defense of the Statute of Limitations. CR at 17. Appellees in their First

Amended Original Answer, filed on June 27, 2013, again asserted a general denial

and raised the defense of limitations. CR at 21.

      On August 8, 2013, Colonial filed its counterclaim, seeking a judgment of

foreclosure on the Loan Agreement due to Melton’s default on his payment

obligations. CR at 37. On September 26, 2013, Appellees moved for summary

judgment on Melton’s affirmative claims, asserting that the Statute of Limitations

barred Melton’s claims for alleged defects in the origination of the Loan

Agreement because more than four years had passed from the date the loan closed

and Melton failed to exercise due diligence to effectuate service. CR at 49.

Colonial in its Motion for Summary Judgment also requested a judgment of

foreclosure.

      At the time Appellees’ Motion for Summary Judgment was heard, Melton

had filed his Third Amended Original Petition, asserting the following claims for

alleged defects in the origination of his home-equity loan: (a) that Colonial failed

to provide Melton with a Notice Concerning Extensions of Credit within twelve

days of the closing on his loan; (b) that Colonial closed Melton’s home equity loan

with a principal amount that exceeded an amount, when added to the principal

balances of all other liens, 80 percent of the fair market value of the home; (c) that

Melton had no control over the appraiser that Colonial allegedly selected for the


                                          3
appraisal; (d) that the appraisal was false and fraudulent; (e) that the appraiser used

and improper methodology in performing his valuation of the Property; (f) that

Colonial closed Melton’s home equity loan with recourse for personal liability; (g)

that Colonial required Melton to apply the proceeds of his home equity loan to

another debt not secured by his home; (h) that Colonial failed to provide a copy of

Melton’s final executed loan application and all executed documents Melton

signed at closing and failed to cure this notice obligation in a timely manner; (i)

that Colonial failed to provide the true fair market value of Melton’s home on the

date the loan closed; (j) that Colonial failed to pay promptly liens that had been

recorded on the Property and (k) Colonial improperly included a “lockout”

provision in the loan documents. CR at 219-20. For these alleged loan-origination

defects, Melton brought a claim for a forfeiture of the Loan Agreement, a claim

Declaratory Judgment that the Loan Agreement was void ab initio, and claims for

fraud, breach of contract and violations of the Texas Deceptive Trade Practices

Act. Id.

      The Trial Court agreed with Appellees’ contentions and on July 14, 2014

granted their Motion for Summary Judgment. CR at 264. Colonial on December

8, 2014 filed a Motion for Award of Attorney’s Fees, which the Trial Court

granted on March 2, 2015. CR 267, 317.




                                          4
                      SUMMARY OF THE ARGUMENT
      Texas law clearly provides a four-year limitations period by which claims

for alleged defects in the origination of a Texas home-equity loan must be brought.

Appellant Ben Melton (“Melton” or “Appellant”) filed his suit on the very last day

of the limitations period, but then waited sixty days to serve his suit on Appellees.

Melton’s supposed justification for waiting to serve the suit is that, two before the

day that he filed, he also sent in a notice of defect letter to Appellees and he

wanted to see how, or whether, Appellee would respond. But wanting to submit

this notice letter does not provide any justification for waiting to file suit.

Therefore, Appellant failed to exercise due diligence as a matter of law and

Melton’s claims are thus barred by limitations.


                           STANDARD OF REVIEW
      On appeal, this Court reviews the summary judgment motion and response

de novo to determine if the competent summary judgment evidence included with

those pleadings shows that there is no genuine issue as to any material fact and the

movant is entitled to summary judgment as a matter of law.              See TEX. R.

CIV. P. 166a(c); Valence Operating Co. v. Dorsett, 164 S.W.3d 656, 661 (Tex.

2005).




                                         5
                      ARGUMENT AND AUTHORITIES

I.    Summary judgment was warranted because Appellant failed to exercise
      due diligence in serving his suit.
      The statute of limitations for a cause of action for violations of Article XVI

of the Texas Constitution is four years. TEX. CIV. PRAC. & REM. CODE Ann.

§16.051 (residual four-year limitations period); see Priester v. JP Morgan Chase

Bank, N.A., 708 F.3d 667, 674 (5th Cir. 2013); Boutari v. JP Morgan Chase Bank,

NA, No. 5:09cv608, 2010 U.S. Dist. LEXIS 144094, *35-36 (W.D. Tex., June 10,

2010), aff’d 429 Fed. Appx. 407 (5th Cir., June 20, 2011); Kyle v. Strasburger, No.

13-13-00609-CV, 2015 WL 7567523, *3-5, 2015 Tex. App. LEXIS 11984, *10-12

(Tex. App.—Corpus Christi Nov. 25, 2015, no pet. h.); In re Estate of Hardesty,

449 S.W.3d 895, 911-12 (Tex. App.—Texarkana 2014, no pet.); Wood v. HSBC

Bank USA, N.A., 439 S.W.3d 585, 590-92 (Tex. App.—Houston [14th Dist.] 2014,

pet. pending); Santiago v. Novastar Mortg., Inc., 443 S.W.3d 462, 469-70 (Tex.

App.—Dallas 2014, pet. denied); Williams v. Wachovia Mortg. Corp., 407 S.W.3d

391, 396-97 (Tex. App.—Dallas 2013, pet. denied); Schanzle v. JPMC Specialty

Mortg. LLC, No. 03-09-00639-CV, 2011 WL 832170, *4, 2011 Tex. App. LEXIS

1748, *10-11 (Tex. App.—Austin March 11, 2011, no pet.).

      Melton’s claim for fraud is also governed by a four-year limitations period,

and his DTPA claim is governed by a two-year limitations period. TEX. BUS. &

COM. CODE ANN. § 17.565 (DTPA); TEX. CIV. PRAC. & REM. CODE § 16.004(a)(4)


                                         6
(fraud). All of his claims accrued at the time of closing. See Schanzle, 2011 Tex.

App. LEXIS 1748, *10; Rivera v. Countrywide Home Loans, Inc., 262 S.W.3d

834, 840 (Tex. App.—Dallas 2008, no pet.); see also Priester v. JP Morgan Chase

Bank, N.A., 708 F.3d 667, 675 (5th Cir. 2013).

        Melton obtained the home equity loan at issue on March 13, 2009. CR at

75, 91. As such, Melton’s claims for violations of the Texas Constitution were

barred after March 13, 2013. Schanzle, 2011 WL 832170, *4. Melton did not file

his Original Petition until the day that the limitations period expired — March 13,

2013. CR at 6. Appellees, however, were not served with process until two months

later — May 13, 2013. CR at 13.

      The timely filing of a lawsuit does not toll the statute of limitations unless

the plaintiff exercises due diligence in effecting service of citation upon the

defendant. Proulx v. Wells, 235 S.W.3d 213, 215 (Tex. 2007). Once the defendant

demonstrates that service was effectuated after the expiration of the limitations

period, the burden shifts to the plaintiff to explain the delay. Id. at 216 (citing

Murray v. San Jacinto Agency, Inc., 800 S.W.2d 826, 830 (Tex. 1990)). Summary

judgment should be granted in favor of a defendant if it is shown that (1) defendant

was not served within the statute of limitations period and (2) as a matter of law,

plaintiff did not use due diligence in effectuating service. Paredes v. City of

Odessa, 128 F. Supp. 2d 1009, 1018 (W.D. Tex. 2000) (citing Gant v. DeLeon, 786



                                         7
S.W.2d 259, 260 (Tex. 1990)).         Lack of diligence in obtaining service on a

defendant exists as a matter of law if it is clear that the plaintiff did not “exhaust all

the alternatives available to achieve proper service.” Roberts v. Padre Island

Brewing Co., 28 S.W.3d 618, 622 (Tex. App.—Corpus Christi 2000, pet. denied).

      Here, Melton failed to exercise due diligence because he waited two months

before doing anything to effectuate service. In Rodriguez v. Tinsman & Houser,

Inc., 13 S.W.3d 47 (Tex. App.—San Antonio 1999, pet. denied), the plaintiff filed

a legal malpractice suit on July 3, 1997 for a claim that accrued on July 14, 1995.

Under the applicable two-year statute of limitations, plaintiff was required to bring

suit no later than July 14, 1997. Id. at 49. Instead of serving her petition, the

plaintiff instructed the clerk not to issue citation for service and was going to notify

the defendant of the lawsuit through written correspondence and seek waiver of

citation. Id. at 48. Upon discovery that the correspondence was never sent, the

plaintiff requested issuance of citation on July 31, 1997 and defendant was served

on August 8, 1997. Id. The defendant was awarded summary judgment claiming

that the plaintiff’s claims were barred by the statute of limitations and the plaintiff

appealed.    Id. at 49.    The Fourth Court of Appeals held that the statute of

limitations was not tolled because plaintiff, as a matter of law, had not exercised

reasonable diligence in effectuating service as a matter of law. Id. at 51.          The

Court reasoned that plaintiff’s inactivity in attempting service amounted to a lack


                                            8
of diligence as a matter of law because there were no efforts from which to

evaluate plaintiff’s reasonableness as a diligent actor. Id.; see also Mauricio v.

Castro, 287 S.W.3d 476, 478 (Tex. App.—Dallas 2009, no pet.) (31 days with no

effort at service is a lack of due diligence at a matter of law); McCord v. Dodds, 69

S.W.3d 230, 234 (Tex. App.—Corpus Christi 2001, pet denied) (eight days).

      Melton attempts to justify his delay in obtaining service by saying he

believed that he needed to wait for sixty days to pass after submitting his notice-of-

claim letter before serving the suit. Appellant’s Brief, p.11-12; see TEX. CONST.

art. XVI, §50(a)(6)(Q)(x)(allowing lender sixty days from receipt of notice of

defect to cure such defect). According to Melton, the submission of this notice

was “require[d]” apparently before filing suit. Id. at 12. Melton, however, is

mistaken. Nothing in Texas law requires that a notice-of-defect letter be sent prior

to the filing of a claim for home-equity origination defects. See TEX. CONST. art.

XVI, § 50(a)(6). 1

      Unlike home-equity defect claims, there are other statutory schemes in

Texas that do require the submission of a notice of claim before the filing of suit,

but the only tolling allowed under those provisions is expressly stated in the

statute. See, e.g., TEX. CIV. PRAC. & REM. CODE ANN. § 74.051(c) (limitations


1
      Of course, Melton in this case did not wait sixty days from the date he sent his notice of
      claim before filing suit. He filed his suit two days after he submitted a Notice of Claim.
      CR at 6 at 210, ¶26. He only waited to effect service.


                                              9
period tolled for 75 days after submission of notice-of-claim letter in a medical-

malpractice case). And in other statutory schemes that call for a pre-suit notice-of-

claim letter, the statute does not provide for a tolling of limitations after the

submission of the claim, and therefore, limitations is not tolled. See TEX. BUS. &

COM. CODE ANN. § 17.505(b) (no tolling after submission of DTPA notice-of-

claim letter).

       The home-equity origination defect claims filed by Melton in this suit fall in

the same category as DTPA claims. The plaintiff may submit a pre-suit notice-of-

claim, but whether or not the plaintiff submits the letter has no bearing on the

running of limitations on the plaintiff’s claims.       Therefore, Melton has not

provided any justification for his delay in effecting service, and his supposed belief

that he needed to wait out the sixty-day period provided in TEX. CONST. art. XVI,

§50(a)(6)(Q)(x) is mistaken.

       Furthermore, Melton’s supposed mistake does not provide him with a valid

reason for failing to timely serve the suit. See, e.g., Hoehn v. Dallas County

Mental Health & Mental Retardation Ctr., No. 05-94-01515-CV, 1995 Tex. App.

LEXIS 3406, 1995 WL 500271, at *3 (Tex. App.—Dallas Aug. 16, 1995, no writ)

(not designated for publication) (holding that plaintiff's explanation that she had

served wrong person because she mistakenly believed him to be proper agent for

government agency, in contravention of explicit statute in Texas Civil Practice and


                                         10
Remedies Code providing correct agent for service, and her failure to learn of her

mistake for five months, did not raise fact question on due diligence and was not

consistent with due diligence); see also Johnson v. City of Fort Worth, No. 2-08-

369-CV, 2009 Tex. App. LEXIS 2124 *9 (Tex. App.—Fort Worth Mar. 26, 2009,

no pet.) (same).

      Additionally, there is no support for Melton’s supposed belief that he had to

provide notice of his claim before suit was filed. Indeed, the case law holds that

the notice may be provided in a pleading, whether as an affirmative claim or in

response to a lender application for foreclosure under Texas Rule of Civil

Procedure 736. See Puig v. Citibank, N.A., Civil Action No. 3:11-CV-0270-L,

2012 U.S. Dist. LEXIS 70398, 2012 WL 1835721, at *15 (N.D. Tex. May 21,

2012) (notice of defect in borrower’s complaint); Wells Fargo Bank, N.A. v.

Leath, 425 S.W.3d 525, 532 (Tex. App.—Dallas 2014, pet. denied) (notice of

defect in borrower’s response to Rule 736 application for foreclosure).

Accordingly, Melton’s submission of a notice-of-defect letter was superfluous; he

could have simply relied upon his Original Petition in this suit to provide Colonial

was notice of his claim.

      For the sake of accuracy, there was no mistake. Appellant’s justification for

waiting until after sixty days had expired before serving the lawsuit was, by his

own admission, nothing more than a strategy decision. He wanted to wait out the


                                        11
sixty days to see whether or not Colonial would respond before serving his suit.

CR at 210, ¶29 (“The delay [in serving the suit] was to give Colonial time to

respond to my demand letter.”)2. The Dallas Court of Appeals considered a similar

issue where a medical-malpractice plaintiff, for strategic reasons, waited until the

deadline to remove a case to federal court had passed before effecting service on a

Texas hospital. Broom v. MacMaster, 992 S.W.2d 659, 664-65 (Tex. App.—

Dallas 1999, no pet.). The Court of Appeals held that the plaintiff’s strategic

reason for withholding service did not justify any delay in serving the suit.                 To

quote the Court:

       Although a plaintiff may have good reasons for not wanting to seek
       immediate service on a defendant, those reasons do not negate the
       requirement that diligence be used in attempting service once the limitations
       period has passed. Id.

       In this case, Melton’s claims for violations of Article XVI of the Texas

Constitution concerning home equity loans are subject to a four-year statute of

limitations period which began to run from the date of the closing of the loan. See

Priester, 708 F.3d at 674; Williams, 2013 Tex. App. LEXIS 8638 at *14-15.

Melton filed his Petition on March 13, 2013, the four-year anniversary of the

closing date of his loan. CR at 6. However, Melton did not serve or attempt to

2
  Melton in his Original Petition pled that “Defendant failed and refused to refund such amounts
… within a reasonable time, 60 days, after being notified of such failure in accordance with Tex.
Const. art. XVI, §50.” CR at 8, ¶12. By using the past tense in this allegation, Melton shows that
he strategically intended to wait for sixty days before serving the suit in the hope that no
response to his Notice of Defect letter would be provided.

                                               12
serve Defendant with the Petition until May 13, 2013, two months after Melton

filed his petition. CR at 13. Melton’s inactivity on attempting service amounts to

lack of diligence as a matter of law. Thus, the four-year statute of limitations

period did not toll from the period Melton filed his Petition to the date Defendant

was served. Melton’s claims are barred by the statute of limitations and Defendant

is entitled to summary judgment. Alternatively, at least his claims under the

DTPA, which is governed by a two-year limitations period, are barred.

II.   Four-year limitations period applies to Melton’s claims.
      As the Fifth Circuit noted in Priester, origination defects in a home-equity

loan can, by express provision in the Texas Constitution, be cured and, therefore,

they are not void ab initio. Priester v. JP Morgan Chase Bank, N.A., 708 F.3d

667, 674 (5th Cir. 2013) (citing TEX. CONST. art. XVI, §50(a)(6)(Q)(x)). Because

those defects can be cured, claims seeking to declare a home-equity lien must

therefore be subject to a limitations period by which they need to be brought. Id.

As there is no express limitations period provided by Texas law for these claims,

then the residual limitation period of Section 16.051 of the Texas Civil Practice

and Remedies Code applies to these claims. Id.

      All of the Texas intermediate appellate courts that have considered the issue

have all reached the same conclusion, namely, that because the alleged defects can

be cured, the subject liens are merely voidable and the residual limitations period



                                        13
applies to those claim.    Kyle v. Strasburger, No. 13-13-00609-CV, 2015 WL

7567523, *3-5, 2015 Tex. App. LEXIS 11984, *10-12 (Tex. App.—Corpus Christi

Nov. 25, 2015, no pet. h.); In re Estate of Hardesty, 449 S.W.3d 895, 909-12 (Tex.

App.—Texarkana 2014, no pet.); Wood v. HSBC Bank USA, N.A., 439 S.W.3d

585, 590-92 (Tex. App.—Houston [14th Dist.] 2014, pet. pending); Santiago v.

Novastar Mortg., Inc., 443 S.W.3d 462, 469-70 (Tex. App.—Dallas 2014, pet.

denied); Williams v. Wachovia Mortg. Corp., 407 S.W.3d 391, 396-97 (Tex.

App.—Dallas 2013, pet. denied).

       As Texas law is clear that a four-year limitations period applies to Melton’s

claims, his second appellate issue should be overruled.

III.   Colonial has standing as both Mortgage Servicer and Mortgagee of
       Record.
       Melton raises for the first time on appeal a question as to whether Colonial

has standing to prosecute its counterclaim for a judgment of foreclosure. There is

no question Colonial has standing.

       As Melton, himself, acknowledges in his Brief, a mortgage servicer has

standing to prosecute a foreclosure action for the mortgage noteholder.         See

Appellant’s Brief, p.23; see TEX. PROP. CODE ANN. § 51.0025; see also Washmon

v. Strickland, No. 03-08-00372-CV, 2010 Tex. App. LEXIS 1366, *6 (Tex. App.—

Austin Feb. 26, 2010, no pet.). Melton contends that the summary-judgment




                                         14
record lacks evidence that Colonial was the last person to demand payments on the

loan, as provided in Section 51.0025.

        This Court considered this very same issue in Washmon. Id., 2010 Tex.

App. LEXIS 1366, *6. In that case, summary judgment was granted in favor of the

lender. On appeal, the borrower argued that the lender had not proven that it was a

mortgage servicer, as defined in Section 51.0025, because it did not provide

summary-judgment evidence that it was the last person to demand payments. Id.

This Court affirmed, however, finding that the Notice of Default with Intent to

Accelerate in the summary-judgment record, which had been sent by the servicer

in that case, constituted conclusive proof that the appellee had proven it was the

mortgage servicer and thus had standing to pursue foreclosure. Id.

        Here, the summary-judgment record contains the same Notice of Default

with Intent to Accelerate submitted by Colonial. CR at 96. Furthermore, the

summary-judgment record contains the payment history of the Loan Agreement

from Colonial, showing that it had received all payments on the loan from its

inception through the summary-judgment proceedings. CR at 151-155. These

facts support the uncontroverted affidavit testimony of Amily Sauceda, Assistant

Vice President of Colonial, that Colonial is the mortgage servicer for the subject

loan.   CR at 64-65, ¶2. Melton presented no summary-judgment evidence to

controvert this proof.   Ragsdale v. Progressive Voters League, 801 S.W.2d 880,



                                        15
882 (Tex. 1990) (holding that clear and uncontroverted affidavit testimony from

interested witnesses present conclusive evidence). Therefore, Melton’s standing

challenge must fail.

         A second basis for finding that Colonial has standing is that Colonial is the

last assignee of record according to the documents of record on file with the Tom

Green County Clerk. As provided in the Texas Property Code, a “mortgagee” can

be, among other things, “the last person to whom the security interest has been

assigned of record.” TEX. PROP. CODE ANN. § 51.0001(4)(C). The summary-

judgment record contains the last Assignment of Deed of Trust with respect to the

subject home-equity loan that was recorded with the Tom Green County Clerk.

CR at 94. This Assignment of Deed of Trust shows Colonial as the last beneficiary

of the Security Instrument. Under Texas law, the noteholder need not be the same

“mortgagee” as provided in Section 51.0001(4)(C). See Tapia v. CitiMortgage,

Inc., No. A-14-CA-135-SS, 2014 U.S. Dist. LEXIS 47624 *5-6 (W.D. Tex. Apr. 7,

2014). As Colonial is the last beneficiary of the Security Instrument of record3, it

is a “mortgagee” under Section 51.0001(4)(C) and thus has standing to pursue

foreclosure. Farkas v. GMAC Mortg., LLC, 737 F.3d 338, 342 (5th Cir. 2013)

(holding that “mortgagee” under Section 51.0001(4)(C) has standing to foreclose).

3
    Melton acknowledges in his Appellant’s Brief that Colonial is the “mortgagee” as provided in
TEX. PROP. CODE ANN. § 51.0001(4)(C). See Appellant’s Brief, p.23.




                                                16
IV.   Trial Court properly awarded attorney’s fees.
      As Melton’s appellate issues are all without merit, the Trial Court’s award of

attorney’s fees should be affirmed.


                                      PRAYER
      WHEREFORE, PREMISES CONSIDERED, Appellees pray that the Trial

Court’s Judgment be in all things affirmed and that they be awarded all other relief

to which they may be entitled.

                                              Respectfully submitted,
                                         By: /s/ Mark D. Cronenwett
                                             MARK D. CRONENWETT
                                             Texas Bar No. 00787303
                                              mcronenwett@mwzmlaw.com

                                          MACKIE WOLF ZIENTZ &
                                          MANN, PC
                                          14160 N. Dallas Parkway, Suite 900
                                          Dallas, Texas 75254
                                          (214) 635-2650
                                          (214) 635-2686 (Fax)

                                          Attorneys for Appellees CU Members
                                          Mortgage, a Division of Colonial
                                          Savings, F.A. and First Western Title
                                          Co.




                                        17
                        CERTIFICATE OF SERVICE

      I hereby certify that on the 8th day of December, 2015, a true and correct
copy of the foregoing was served via the State’s electronic filing service to the
counsel of record listed below:

      James C. Mosser
      Nicholas D. Mosser
      Paul J. Downey
      Mosser Law PLLC
      2805 Dallas Parkway, Suite 222
      Plano, Texas 75093
      courtdocuments@mosserlaw.com
      COUNSEL FOR APPELLANTS JAMES C. MOSSER AND
      MOSSER LAW PLLC

      Larry W. Bale
      Hay, Wittenburg, Davis, Caldwell & Bale, LLP
      P O Box 271
      San Angelo, Texas 76902-0271
      lwb@hwdcb.com
      COUNSEL FOR APPELLEE BOB MIMS

      Gregory Sherwood
      P.O. Box 200613
      Austin, Texas 78720-0613
      gsherwood@mail.com
      COUNSEL FOR APPELLANT BEN MELTON

                                         /s/ Mark D. Cronenwett___________
                                         MARK D. CRONENWETT




                                       18
         CERTIFICATE OF COMPLIANCE WITH RULE 9.4(i)(2)

    This brief complies with the word-number limitation of TEX. R. APP. P.

9.4(i)(2) because this brief contains 4,158 words, excluding the parts of the brief

exempted by TEX. R. APP. P. 9.4(i)(2).

                                              /s/ Mark D. Cronenwett
                                              MARK D. CRONENWETT




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