                             Fourth Court of Appeals
                                    San Antonio, Texas
                                MEMORANDUM OPINION
                                       No. 04-12-00478-CV

                                          Jim MORRIS,
                                             Appellant

                                                  v.

 HSBC BANK USA, National Association as Trustee for the Benefit of the Certificate Holders,
 Nomura Home Equity Loan, Inc., Asset-Backed Pass-Through Certificates, Series 2005-FM1,
                                       Appellee

                    From the County Court at Law No. 1, Tarrant County, Texas
                                 Trial Court No. 2011-002736-1
                           The Honorable Don Pierson, Judge Presiding

Opinion by:      Rebeca C. Martinez, Justice

Sitting:         Catherine Stone, Chief Justice
                 Sandee Bryan Marion, Justice
                 Rebeca C. Martinez, Justice

Delivered and Filed: April 17, 2013

AFFIRMED

           Jim Morris appeals from a summary judgment granted in favor of HSBC Bank USA (the

“Bank”) in a suit alleging wrongful foreclosure. We affirm the judgment of the trial court.

                                           BACKGROUND

           On January 13, 2005, Morris executed a Texas Home Equity Adjustable Rate Note

payable to the order of Freemont Investment & Loan in the principal amount of $351,200 (the

“Note”). To secure payment of the Note, Morris concurrently executed a Texas Home Equity

Security Instrument (“Deed of Trust”). The Deed of Trust encumbered the property located at
                                                                                 04-12-00478-CV


2501 South Adams Street in Fort Worth. Morris defaulted on his repayment obligations under

the Note and Deed of Trust. Therefore, on April 11, 2007, Countrywide Home Loans, as

mortgage servicer, notified Morris of the default of his repayment obligations. On June 28,

2007, counsel for Countrywide notified Morris by certified mail that Countrywide had

accelerated the maturity of the debt.

       On July 19, 2007, the Bank instituted a nonjudicial foreclosure action pursuant to Rule

736. See TEX. R. CIV. P. 736. The Bank’s application for expedited foreclosure was filed in

Cause Number 342-224989-07 in the 342nd Judicial District Court of Tarrant County, Texas.

The district court granted the Bank’s application and entered a Default Home Equity Foreclosure

Order authorizing the Bank to “proceed with a foreclosure sale.” After serving Morris with

notice of sale, the South Adams Street property was foreclosed and sold at auction on March 4,

2008. Following the sale, on April 30, 2008, Morris sued the Bank to set aside the allegedly

wrongful foreclosure and “to recover for the unlawful declaration of default and acceleration of

maturity of the underlying promissory note, and for attorney fees.” The petition was filed in

Cause Number 096-230073-08 in the 96th Judicial District Court in Tarrant County. The Bank,

in turn, filed a no-evidence motion for summary judgment, which was granted by the trial court

in its entirety on January 7, 2010. Morris did not appeal.

       More than a year later, on April 12, 2011, Morris filed a second lawsuit against the Bank

in which he alleged claims for breach of contract and wrongful foreclosure regarding the South

Adams Street property, and requested declaratory relief stemming from the foreclosure of the

property. Morris claimed that despite the Bank’s sale of the Adams Street property and its

attempt to evict him from the property, the Bank failed to provide Morris adequate notice of

assignment or notice of default, acceleration, or notice of sale pursuant to the Texas Property

Code. In response, the Bank filed a motion for traditional and no-evidence summary judgment
                                               -2-
                                                                                     04-12-00478-CV


arguing that all of Morris’s claims are barred by res judicata, and, alternatively, that there is no

evidence to support Morris’s claims.        Morris filed a response to the motion for summary

judgment in which he asserted that the Bank’s summary judgment evidence was insufficient and

defective. Following a hearing, the trial court granted summary judgment in favor of the Bank

without stating the basis for its ruling.

Standard of Review

        We review a grant of summary judgment de novo. Exxon Corp. v. Emerald Oil & Gas

Co., L.C., 331 S.W.3d 419, 422 (Tex. 2010). When the trial court does not specify the grounds

for its ruling, a summary judgment will be affirmed if any of the grounds advanced by the

motion are meritorious. FM Props. Operating Co. v. City of Austin, 22 S.W.3d 868, 872–73

(Tex. 2000). A party moving for traditional summary judgment has the burden to prove that

there is no genuine issue of material fact and it is entitled to judgment as a matter of law. TEX.

R. CIV. P. 166a(c); Mann Frankfort Stein & Lipp Advisors, Inc. v. Fielding, 289 S.W.3d 844, 848

(Tex. 2009). Where, as here, a party moves for summary judgment on the grounds of an

affirmative defense, the movant must plead and conclusively prove each essential element of its

affirmative defense, thereby defeating the plaintiff’s cause of action. Chau v. Riddle, 254

S.W.3d 453, 455 (Tex. 2008); Villanueva v. Gonzalez, 123 S.W.3d 461, 464 (Tex. App.—San

Antonio 2003, no pet.). Evidence is conclusive only if reasonable people could not differ in their

conclusions. City of Keller v. Wilson, 168 S.W.3d 802, 816 (Tex. 2005).

                                            DISCUSSION

        In a single issue on appeal, Morris argues the trial court erred in granting summary

judgment because: (1) the Bank’s motion was supported by a legally defective affidavit; (2)

Morris’s claims are not barred by res judicata; and (3) Morris was entitled to an accounting.

Because we believe it to be dispositive of this appeal, we begin by addressing the issue of res
                                                -3-
                                                                                    04-12-00478-CV


judicata. Morris contends that res judicata does not apply because Rule 736.9 provides that an

expedited foreclosure order has no res judicata effect in any other judicial proceeding. See TEX.

R. CIV. P. 736.9. Morris, however, fails to acknowledge the final judgment rendered by the 96th

Judicial District Court in his first lawsuit. In its motion for summary judgment, the Bank argued

that Morris’s claims regarding the validity of the foreclosure in the present lawsuit are barred by

res judicata because they were previously considered and found meritless by the 96th Judicial

District Court in Cause Number 096-230073-08. Because res judicata is an affirmative defense,

the Bank bore the burden of establishing as a matter of law that res judicata applied. See TEX. R.

CIV. P. 94; Shah v. Moss, 67 S.W.3d 836, 842 (Tex. 2001). Res judicata precludes relitigation of

claims that have been finally adjudicated, or that arise out of the same subject matter and that

could have been litigated in the prior action. Amstadt v. U.S. Brass Corp., 919 S.W.2d 644, 652

(Tex. 1996). For res judicata to apply, there must be: (1) a prior final judgment on the merits by

a court of competent jurisdiction; (2) identity of parties or those in privity with them; and (3) a

second action based on the same claims that were raised or could have been raised in the first

action. Citizens Ins. Co. of Am. v. Daccach, 217 S.W.3d 430, 449 (Tex. 2007). The doctrine

seeks to bring an end to litigation, prevent vexatious litigation, maintain stability of court

decisions, promote judicial economy and prevent double recovery. Id.

       Here, a prior final judgment on the merits by a court of competent jurisdiction exists.

The Bank attached to its motion for summary judgment the “Order Granting No-Evidence

Motion for Summary Judgment” rendered by the 96th Judicial District Court in Cause Number

096-230073-08 signed on January 7, 2010. Accordingly, the Bank conclusively proved the first

element of its affirmative defense of res judicata.




                                                -4-
                                                                                    04-12-00478-CV


       As to the second element, the parties in the present matter and those in Cause Number

096-230073-08 are the same: Morris is/was the plaintiff and the Bank is/was the defendant.

Thus, the Bank conclusively proved the second element of its affirmative defense of res judicata.

       Finally, we must decide whether the second action was based on the same claims that

were raised or could have been raised in the first action. In determining whether res judicata bars

a subsequent lawsuit, Texas follows the “transactional” approach, which “provides that a final

judgment on an action extinguishes the right to bring suit on the transaction, or series of

connected transactions, out of which the action arose.” Barr v. Resolution Trust Corp., 837

S.W.2d 627, 631 (Tex. 1992). Under the transactional approach, the subject matter of a suit is

based on the factual matters that make up the gist of the complaint. Id. at 630. Any claim that

arises out of those facts should be litigated in the same lawsuit. Id.; see also Pustejovsky v.

Rapid-American Corp., 35 S.W.3d 643, 651 (Tex. 2000).

       Here, the record demonstrates that the issues asserted by Morris in the present lawsuit

were litigated, or could have been litigated, in the first lawsuit. In the first lawsuit, Morris

asserted that the foreclosure was wrongful because the Bank misrepresented to him that it would

stop the foreclosure if he provided them with proof of a loan approval to refinance. In the

second lawsuit, Morris again challenged the foreclosure, alleging that the Bank did not have a

right to foreclose because it failed to follow proper procedures, i.e., breach of contract. These

claims arise out of the same facts and could have been litigated in the first lawsuit. Because

claims from both the first and second suits pertain to the March 4, 2008 foreclosure of the South

Adams Street property, we conclude the Bank conclusively proved the third element of its

affirmative defense of res judicata. Accordingly, the Bank met its summary judgment burden of

conclusively proving each essential element of its affirmative defense. See Chau, 254 S.W.3d at

455.
                                               -5-
                                                                                04-12-00478-CV


                                         CONCLUSION

       We conclude that the Bank met its burden of conclusively proving the elements of its

affirmative defense of res judicata, and established its right to judgment as a matter of law.

Accordingly, we overrule Morris’s issue on appeal and affirm the trial court’s order granting

summary judgment in favor of the Bank.


                                               Rebeca C. Martinez, Justice




                                             -6-
