                                                                                      ACCEPTED
                                                                                  03-15-00020-CV
                                                                                          5774899
                                                                       THIRD COURT OF APPEALS
                                                                                  AUSTIN, TEXAS
                                                                             6/22/2015 4:26:51 PM
                                                                                JEFFREY D. KYLE
                                                                                           CLERK
                          Case No. 03-15-00020-CV

                                                      FILED IN
                                               3rd COURT OF APPEALS
                    IN THE COURT OF APPEALS        AUSTIN, TEXAS
                FOR THE THIRD DISTRICT OF TEXAS6/22/2015 4:26:51 PM
                         AUSTIN, TEXAS           JEFFREY D. KYLE
                                                       Clerk

                             JAMES V. LONG,
                                 Appellant,
                                     v.
                 SOUTHWEST FUNDING, LP, ET AL.,
                                 Appellees.


            Appealed from the 126th Judicial District Court of
                         Travis County, Texas
                    Cause No. D-1-GTN-10-003483


    APPELLEES, INDY MAC MORTGAGE SERVICES, ONEWEST BANK,
       FSB AND DEUTSCHE BANK NATIONAL TRUST CO.’S BRIEF


J. Garth Fennegan                             SETTLEPOU
Texas Bar I.D. 24004642                       3333 Lee Parkway, Eighth Floor
gfennegan@settlepou.com                       Dallas, Texas 75219
Daniel P. Tobin                               (214) 520-3300
Texas Bar I.D. 24046978                       (214) 526-4145 (Facsimile)
dtobin@settlepou.com
Bradley E. McLain                             ATTORNEYS FOR
Texas Bar No. 24041453                        APPELLEES, INDY MAC
bmclain@settlepou.com                         MORTGAGE SERVICES,
                                              ONEWEST BANK, FSB AND
                                              DEUTSCHE BANK NATIONAL
                                              TRUST CO.


                                     i
                                                 Table of Contents

Table of Contents ...................................................................................................... ii 
Table of Authorities ................................................................................................. iii 
Issues Presented ....................................................................................................... vi 
Statement of Facts ......................................................................................................1 
Summary of the Argument.........................................................................................5 
Argument....................................................................................................................6 
         I.        The Trial Court correctly granted summary judgment for the
                   Deutsche Bank Defendants on Mr. Long’s claims. ..............................6 
                   A.        Mr. Long failed to raise a genuine issue of material fact
                             on his TILA violations claim. .....................................................8 
                   B.        Mr. Long failed to raise a genuine issue of material fact
                             on his wrongful foreclosure claim. .............................................9 
         II.       The Trial Court correctly granted summary judgment for
                   Deutsche Bank on its counterclaim for judicial foreclosure. ..............11 
                   A.        The Boyle Affidavit is legally sufficient summary
                             judgment evidence. ...................................................................13 
                                  1.  Mr. Long waived his objections to the Boyle
                                      Affidavit. ....................................................................... 13 
                                  2.  The Boyle Affidavit affirmatively demonstrates
                                      the affiant’s personal knowledge. ................................. 15 
                   B.        Mr. Long has failed to raise a genuine issue of material
                             fact on Deutsche Bank’s counterclaim for judicial
                             foreclosure. ................................................................................20 
Prayer .......................................................................................................................24 
Certificate of Compliance ........................................................................................25 
Certificate of Service ...............................................................................................25 




                                                               ii
                                              Table of Authorities
Cases 
Bierwirth v. BAC Home Loans Servicing, L.P.,
      No. 03-11-00644-CV, 2012 WL 3793190, *3 (Tex. App.—
      Austin Aug. 30, 2012, pet. denied) (mem. op.) .............................................22

Damron v. Citibank (S. D.) N.A.,
    No. 03-09-00438-CV, 2010 WL 3377777, *3 (Tex. App.—
    Austin Aug. 25, 2010, pet. denied) (mem. op.). ............................... 14, 17, 18

Davis v. Deutsche Bank National Trust,
      No. 03-12-00768-CV, 2015 WL 1967909, *2 (Tex. App.—
      Austin April 30, 2015, no pet. h.) (mem. op.) ...............................................10

Dickey v. Club Corp. of America,
      12 S.W.3d 172, 176 (Tex. App.—Dallas 2000, pet. denied) ........................15

Dodeka v. Campos,
     377 S.W.3d 726 (Tex. App.—San Antonio 2012, no pet.) ................... 16, 19

Dulong v. Citibank (S.D.), N.A.,
     261 S.W.3d 890, 893 (Tex. App.—Dallas 2008, no pet.) .............................14

Elite Towing, Inc v. LSI Fin. Group,
       985 S.W.2d 635, 644 (Tex. App.—Austin 1999, no pet.).............................14

Fernandez v. Peters,
     No. 03-09-00687-CV, 2010 WL 4137491, *3 (Tex. App.—
     Austin Oct. 19, 2010, no pet.) (mem. op.) .................................... 7, 13, 14, 15

First State Bank v. Keilman,
       851 S.W.2d 914, 921-22 (Tex. App.—Austin 1993, writ
       denied) .............................................................................................................9

Grand Prairie Indep. Sch. Dist. v. Vaughn,
     792 S.W.2d 944 (Tex. 1990) .................................................................. 13, 14
                                                             iii
Hydroscience Tech., Inc. v. Hydroscience, Inc.,
     401 S.W.3d 783, 791 (Tex. App.—Dallas 2013, pet denied) .......................16

In re E.I. DuPont de Nemours & Co.,
       136 S.W.3d 218, 224 (Tex. 2004) (per curiam); .................................... 15, 16

John Gannon, Inc. v. Gunnarson Outdoor Adver., Inc.,
      No. 03-08-00404-CV, 2010 WL 3192536, *2 (Tex. App.—
      Austin Aug. 11, 2010, pet. denied) (mem. op.) ...............................................7

John Hancock Mut. Life Ins. Co. v. Howard,
      85 S.W.2d 986, 988-89 (Tex. Civ. App.—Waco 1935, writ
      ref’d) ....................................................................................................... 10, 11

Kyle v. Countrywide Home Loans, Inc.,
      232 S.W.3d 355, 360 (Tex. App.—Dallas 2007, pet. denied). .....................18

Merriman v. XTO Energy, Inc.¸
     407 S.W.3d 244 (Tex. 2013) .......................................................................6, 7

Peterson v. Black,
      980 S.W.2d 818, 823 (Tex. App.—San Antonio 1998, no pet.) ...................10

Roper v. CitiMortgage, Inc.,
      No. 03-11-00887-CV, 2013 WL 6465637, *13 (Tex. App.—
      Austin Nov. 27, 2013, pet. denied) (mem. op.) .............. 16, 17, 18, 19, 20, 22

Wells Fargo Bank, N.A. v. Robinson,
      391 S.W.3d 590, 593-94 (Tex. App.—Dallas 2012, no pet.) ............. 9, 10, 11

Wilson v. Thomason Funeral Home, Inc.,
      No. 03-02-00774-CV, 2003 WL 21706065, *5 (Tex. App.—
      Austin July 24, 2003, no pet.) ........................................................................14


 


                                                            iv
Statutes 
15 U.S.C.A. § 1640(e) ...............................................................................................8
Tex. R. App. P. 33.1.................................................................................................14
Tex. R. Civ. P. 166a(f) .............................................................................................15
Tex. R. Civ. P. 735 (West 2000) ..............................................................................21
Tex. R. Evid. 803(6), 902(10) ..................................................................................16
Tex. R. Evid. 902 .....................................................................................................23
Tex. R. Evid. 902(10)...............................................................................................18




                                                           v
                               Issues Presented

I.    Did the Trial Court correctly grant summary judgment for Deutsche Bank,
      OneWest and IndyMac on Mr. Long’s claims alleging violations in the Truth
      in Lending Act and for wrongful foreclosure when:

          Mr. Long failed to challenge all the grounds on which summary
           judgment was granted;

          Mr. Long failed to raise a fact issue on an the alleged Truth in
           Lending violations; and

          Mr. Long failed to raise a fact issue on his wrongful foreclosure
           claim?

II.   Did the Trial Court correctly grant summary judgment for Deutsche Bank on
      its counterclaim for judicial foreclosure when: 

          Mr. Long waived his objections to the Boyle Affidavit offered in
           support of summary judgment;

          The Boyle Affidavit affirmatively demonstrates the affiant’s personal
           knowledge;

          The Boyle Affidavit authenticates the business records attached to it;
           and

          Mr. Long failed to raise a fact issue on Deutsche Bank’s counterclaim
           for judicial foreclosure?




                                       vi
                              Statement of Facts

      This appeal arises from Mr. Long’s failure to make a payment on his home

equity loan since August 2009. CR 98, 245. In March 2007, Mr. Long obtained a

home equity loan from Southwest Funding, LP (“Southwest Funding”) in order to

refinance the mortgage on the real property located at 608 Cutlass, Lakeway,

Texas 78738 (“Property”). CR 198. As part of the refinance transaction, Mr. Long

executed a Texas Home Equity Fixed/Adjustable Rate Note (“Note”) made

payable to Southwest Funding and its assigns in which he promised to repay the

principal amount of $710,400.00, plus interest at a rate of 7.625% per annum,

subject to adjustment in accordance with Section 4 of the Note. CR 101-05, 198,

200-05. Mr. Long’s repayment obligations under the Note were secured by a

Texas Home Equity Security Instrument (“Security Instrument”) establishing a

first lien on the Property. CR 97, 198, 206-22. Additionally, Mr. Long executed a

Confirmation of Non-Cancellation on March 21, 2007, affirming the home equity

loan and requesting Southwest Funding to disburse the loan proceeds in

accordance with the terms of the Note and Security Instrument. CR 230-31.

      Mortgage Electronic Registration Systems, Inc. (“MERS”) is the nominee of

Southwest Funding and its successors and assigns under the terms of the Security

Instrument, and MERS is a beneficiary under the Security Instrument. CR 206-07.

MERS subsequently assigned the Note and Security Instrument to Deutsche Bank

                                       1
National Trust Company, as Trustee for Indymac Index Mortgage Loan Trust

2007-AR13, Mortgage Pass-Through Certificates Series 2007-AR13, which is

memorialized by an Assignment of Note and Deed of Trust dated January 21,

2010, but effective December 22, 2009 (“Assignment”). CR 198-99, 223-24. As

such, Deutsche Bank is now the lawful owner and holder of the Note and Security

Instrument, is in possession of the Note and Security Instrument, and has not

assigned same. CR 95, 198-99.

      Mr. Long stopped making payments on the Note in September 2009. CR

97-98, 199, 245. As a result, a Notice of Default was sent to Mr. Long on

November 6, 2009, by IndyMac Mortgage Services, a division of OneWest Bank,

FSB (“OneWest”), who was the designated mortgage servicer for Mr. Long’s Note

on behalf of Deutsche Bank. CR 96-98, 199, 225-27. Mr. Long, however, failed

to cure his default, and OneWest sent Mr. Long a Notice of Acceleration on

January 18, 2010. CR 98, 199, 228-29.

      Since Mr. Long continued in default of his repayment obligations under the

Note, OneWest, as the authorized mortgage servicer on behalf of Deutsche Bank,

filed a Verified Application Home Equity Foreclosure Order on February 12, 2010.

CR 91-128. After a properly noticed hearing on July 23, 2010, the Trial Court

entered an order pursuant to Rule 736 of the Texas Rules of Civil Procedure

allowing Deutsche Bank to proceed with an expedited foreclosure sale of a lien for

                                        2
a home equity loan (“Home Equity Foreclosure Order”). CR 130-34. Rather than

raising his complaints about the home equity loan, his default, or the sale of the

Property in a new lawsuit as required by Rule 736, Mr. Long filed a motion for

new trial challenging the Home Equity Foreclosure Order, which the Trial Court

granted on September 2, 2010. CR 68, 312. Although a foreclosure sale of the

Property was held on September 7, 2010, Deutsche Bank did not accept delivery of

the Substitute Trustee’s Deed, and title to the Property remained in Mr. Long. CR

313-14.

      Mr. Long filed the underlying suit against Deutsche Bank, OneWest and

IndyMac (collectively “Deutsche Bank Defendants”) on September 28, 2010,

asserting claims for fraud, rescission, wrongful foreclosure and declaratory

judgment. CR 4-6, 30-33.       In addition to generally denying and asserting

affirmative defenses to Mr. Long’s claims, Deutsche Bank asserted a counterclaim

for judicial foreclosure of the Security Instrument. CR 19-27. The Deutsche Bank

Defendants subsequently moved for summary judgment on Mr. Long’s claims for

fraud, declaratory judgment and wrongful foreclosure, as well as on Deutsche

Bank’s counterclaim for judicial foreclosure. CR 182-97. The Trial Court granted

the Deutsche Bank Defendants’ motion for traditional and no-evidence summary

judgment against Mr. Long’s claims, and the Trial Court granted summary



                                        3
judgment for Deutsche Bank on its counterclaim for judicial foreclosure. CR 350-

51.




                                       4
                          Summary of the Argument

      Mr. Long has not made a payment on his home equity loan in almost six

years, and he does not dispute that he is in default of his repayment obligations

under his home equity loan. Consequently, the Trial Court granted summary

judgment in favor of the Deutsche Bank Defendants disposing of Mr. Long’s

meritless claims for fraud, violations of TILA, and wrongful foreclosure, and

allowing Deutsche Bank to move forward with the enforcement of the home equity

security instrument through a claim for judicial foreclosure. Although Mr. Long

claims he raised fact issues both on his claims and Deutsche Bank’s counterclaim

for judicial foreclosure, the summary judgment evidence proves otherwise.

Moreover, Mr. Long’s objections to the Deutsche Bank Defendant’s summary

judgment evidence are either waived or without merit as the Trial Court’s

judgment rests on competent summary judgment evidence showing that Mr. Long

is in default under the terms of the home equity note and security instrument, and

that the Deutsche Bank Defendants have complied with all contractual and

statutory requirements to foreclose on the Property. Therefore, this Court should

affirm the Trial Court’s order granting traditional and no-evidence summary

judgment in favor of the Deutsche Bank Defendants on Mr. Long’s claims and on

Deutsche Bank’s counterclaim for judicial foreclosure.



                                        5
                                    Argument

I.    The Trial Court correctly granted summary judgment for the Deutsche
      Bank Defendants on Mr. Long’s claims.
      Mr. Long is appealing the Trial Court’s Order granting Deutsche Bank,

OneWest, and IndyMac’s motion for summary judgment against Mr. Long’s

claims for violations of the Truth In Lending Act (“TILA”) in the origination of his

home equity loan, wrongful foreclosure, and fraud.           The Deutsche Bank

Defendants moved for both traditional and no-evidence summary judgment against

Mr. Long’s claims on multiple grounds. CR 182-96. The Trial Court granted the

motions for summary judgment in all respects without specifying the grounds for

its ruling. CR 350. As such, Mr. Long has the burden in this appeal to raise a fact

issue on all the grounds that support the Trial Court’s judgment in favor of the

Deutsche Bank Defendants. Mr. Long, however, has failed to raise a genuine issue

of material fact all the grounds upon which the Trial Court’s judgment rests.

Therefore, the Trial Court’s summary judgment in favor of the Deutsche Bank

Defendants must be affirmed.

      The granting of a motion for summary judgment is reviewed de novo.

Merriman v. XTO Energy, Inc.¸ 407 S.W.3d 244, 248 (Tex. 2013). When the trial

court does not specify the grounds for its ruling, the appealing party must

challenge all the grounds that support the judgment, and the summary judgment

must be affirmed if any of the grounds on which judgment is sought are
                                         6
meritorious. Id. When an appellant fails to challenge a ground on which a trial

court may have granted summary judgment—either properly or improperly, then

the summary judgment must be affirmed. Id.; John Gannon, Inc. v. Gunnarson

Outdoor Adver., Inc., No. 03-08-00404-CV, 2010 WL 3192536, *2 (Tex. App.—

Austin Aug. 11, 2010, pet. denied) (mem. op.).

      In order to meet his burden in this appeal, Mr. Long must show that the

Deutsche Bank Defendants failed to negate at least one essential element of each of

his causes of action or to prove each element of their affirmative defenses.

Fernandez v. Peters, No. 03-09-00687-CV, 2010 WL 4137491, *3 (Tex. App.—

Austin Oct. 19, 2010, no pet.) (mem. op.). Thus, Mr. Long must show there is a

genuine issue of material fact on each of his claims preventing summary judgment

in favor of the Deutsche Bank Defendants. Id. Mr. Long does not challenge the

Trial Court’s no-evidence summary judgment on his fraud based claims. CR 32,

194-95; Appellant’s Brief at 9, 11. Consequently, the only two claims before this

Court in this appeal are Mr. Long’s claim for TILA violations and wrongful

foreclosure.   Mr. Long argues that he raised genuine issues of material fact

concerning the validity of the foreclosure sale, Deutsche Bank’s status as the

holder of the Note, Southwest Funding’s status to originate the Note, and

compliance with home equity lending requirements under the Texas Constitution

that prevent summary judgment in favor of the Deutsche Bank Defendants.

                                        7
Appellant’s Brief at 15-16. Contrary to Mr. Long’s assertions, these purported

“genuine issues of material fact” do not defeat the Deutsche Bank Defendant’s

motion for summary judgment on Mr. Long’s claims for TILA violations or

wrongful foreclosure.

      A.    Mr. Long failed to raise a genuine issue of material fact on his
            TILA violations claim.
      Mr. Long claims Southwest Funding violated TILA because the Note was

securitized and the estimated interest rate was not correct. CR 30. The Deutsche

Bank Defendants moved for summary judgment on the grounds that these alleged

TILA violations were not actionable, and even if they were, any cause of action for

the violations were barred by the statute of limitations.       CR 189-90.      The

uncontroverted summary judgment evidence shows that Mr. Long executed the

Note and Security Instrument on or about March 16, 2007. CR 200-22, 245-46.

As such, Mr. Long’s claims for TILA violations had to be asserted within one year

of the occurrence of the alleged violations, which was March 16, 2008.           15

U.S.C.A. § 1640(e).

      Mr. Long, however, failed to assert the alleged TILA violations until he filed

this case in September 2010. CR 4-6. Thus, any cause of action Mr. Long may

have for violations of TILA are barred by the applicable statute of limitations.

Assuming Mr. Long’s alleged TILA violations are true, Mr. Long has still failed

both in his response to the motion for summary judgment and in his brief to this
                                         8
Court to point to any competent summary judgment evidence showing his claim is

not barred by the applicable statute of limitations. CR 258-60, 264-65; Appellant’s

Brief at 15-16. Therefore, the Trial Court correctly granted summary judgment on

Mr. Long’s alleged TILA violations.

       B.     Mr. Long failed to raise a genuine issue of material fact on his
              wrongful foreclosure claim.
       Similarly, Mr. Long failed to raise a genuine issue of material fact on his

wrongful foreclosure claim. A foreclosure sale that fails to comply with statutory

or contractual terms gives rise to a cause of action for either rescission of the

trustee’s deed or for damages. Wells Fargo Bank, N.A. v. Robinson, 391 S.W.3d

590, 593-94 (Tex. App.—Dallas 2012, no pet.); First State Bank v. Keilman, 851

S.W.2d 914, 921-22 (Tex. App.—Austin 1993, writ denied). A mortgagor has a

claim for damages when the mortgagor has suffered a loss or material injury as a

result of the improper foreclosure. Wells Fargo, 391 S.W.3d at 594. The recovery

of damages is not available, however, when the property has not passed to a third

party and the mortgagor’s possession of the property has not been materially

disturbed. Id. In that case, the proper remedy is to rescind the trustee’s deed,

restore title in the borrower, and to reaffirm the debt and the mortgagee’s right to

foreclose its lien. Id.

       Mr. Long claims that the foreclosure sale conducted on September 7, 2010,

was improper because it was not conducted pursuant to a court order as the Texas
                                         9
Constitution requires for the foreclosure of home equity liens. CR 31-32, 259-60;

Appellant’s Brief at 7, 10, 15. Mr. Long also cites to the “Statement of Facts to

Purge Real Property Records” filed by the substitute trustee rescinding the

foreclosure sale due to “one or more conditions precedent” required to conduct the

sale having not been accomplished as further evidence of the Deutsche Bank

Defendants’ wrongful foreclosure. CR 259-60, 274.

      Despite these alleged defects or irregularities in the foreclosure sale, Mr.

Long has not pointed to any competent summary judgment evidence showing that

he has suffered a loss or material injury as a result of the improper foreclosure.

Mr. Long produced no summary judgment evidence that the Deutsche Bank

Defendants materially interfered with or disturbed his possession of the Property as

a result of the alleged wrongful foreclosure. Davis v. Deutsche Bank National

Trust, No. 03-12-00768-CV, 2015 WL 1967909, *2 (Tex. App.—Austin April 30,

2015, no pet. h.) (mem. op.); Peterson v. Black, 980 S.W.2d 818, 823 (Tex. App.—

San Antonio 1998, no pet.); John Hancock Mut. Life Ins. Co. v. Howard, 85

S.W.2d 986, 988-89 (Tex. Civ. App.—Waco 1935, writ ref’d). Thus, Mr. Long

has not suffered any compensable damage for wrongful foreclosure since his

possession of the Property is undisturbed. Davis, 2015 WL 1967909 at *2; Wells

Fargo, 391 S.W.3d at 594; Peterson, 980 S.W.2d at 823.



                                        10
       Moreover, the uncontroverted summary judgment evidence demonstrates

that Deutsche Bank never accepted delivery of the Substitute Trustee’s Deed from

the September 2010 foreclosure and the title to the Property remains vested in Mr.

Long. CR 274. As such, Mr. Long likewise does not have a cause of action for

wrongful foreclosure to rescind the Substitute Trustee’s Deed and restore his title

to the Property. Wells Fargo, 391 S.W.3d at 594; John Hancock, 85 S.W.2d at

989.   Accordingly, the Trial Court correctly granted summary judgment for the

Deutsche Bank Defendants on Mr. Long’s wrongful foreclosure claim as the

summary judgment evidence established that Mr. Long had no legally cognizable

injury as a result of the September 2010 foreclosure sale.

       Therefore, the Trial Court’s granting of summary judgment on Mr. Long’s

claims against the Deutsche Bank Defendants for TILA violations, wrongful

foreclosure, and fraud must be affirmed as the Deutsche Bank Defendants

established their right to summary judgment on these causes of action as a matter

of law, and Mr. Long has failed to raise a genuine issue of material fact to defeat

summary judgment on these claims.

II.    The Trial Court correctly granted summary judgment for Deutsche
       Bank on its counterclaim for judicial foreclosure.

       Deutsche Bank moved for summary judgment on its counterclaim for

judicial foreclosure seeking an order taking all right, title, interest, and possession

of the Property pursuant to the terms of the Security Instrument executed by Mr.
                                       11
Long. CR 45, 187-89. In support of its motion for summary judgment, Deutsche

Bank offered the Affidavit of Charles Boyle, as the corporate representative of

OneWest Bank, FSB, the designated mortgage servicer of Mr. Long’s home equity

mortgage for Deutsche Bank. CR 198-99. Attached to the Boyle Affidavit were

business records of OneWest concerning Mr. Long’s home equity loan, which

showed: (1) Deutsche Bank was the holder of the Note and the beneficiary under

the Security Instrument executed by Mr. Long, (2) Mr. Long was in default of his

obligations under the Note and Security Instrument, and (3) Deutsche Bank had

strictly complied with the terms of the Security Instrument and Chapter 51 of the

Texas Property Code by sending Mr. Long the required notices of default and

acceleration. CR 206-29. Moreover, Mr. Long neither disputes the authenticity of

the Note and Security Instrument, nor that he was in default of repayment

obligations under the Note. See CR 245, 248. The undisputed summary judgment

evidence thus showed that Mr. Long was in default under the terms of the Note and

Security Instrument, and that Deutsche Bank, through its authorized servicer,

complied with all contractual and statutory requirements to foreclose. As such,

Deutsche Bank established its right to summary judgment on its counterclaims for

judicial foreclosure as a matter of law.




                                           12
      A.     The Boyle Affidavit is legally sufficient summary judgment
             evidence.

      Mr. Long argues the Boyle Affidavit is insufficient summary judgment

evidence because it is not based on personal knowledge. Appellant’s Brief at 13-

15.   Mr. Long’s objections to the Boyle Affidavit are in essence hearsay

objections, which are objections to the form of the affidavit. Although Mr. Long

objected to the Boyle Affidavit before the Trial Court, he failed to preserve his

objections for appellate review.    Therefore, Mr. Long’s objections have been

waived. Even if Mr. Long’s objections were not waived, the Boyle Affidavit

affirmatively shows that it is based on personal knowledge, is competent summary

judgment evidence, and meets the requirements of the Business Records hearsay

exception. Finally, Mr. Long has failed to raise a genuine issue of material fact on

Deutsche Bank’s counterclaim for judicial foreclosure. Accordingly, the Trial

Court correctly granted summary judgment on Deutsche Bank’s counterclaim for

judicial foreclosure.

             1.     Mr. Long waived his objections to the Boyle Affidavit.
 
      A party’s objection that an affidavit contains hearsay is an objection to

defects in the form of an affidavit. Grand Prairie Indep. Sch. Dist. v. Vaughn, 792

S.W.2d 944, 945 (Tex. 1990); Fernandez v. Peters, No. 03-09-00687-CV, 2010

WL 4137491, *4 (Tex. App.—Austin Oct. 19, 2010, no pet.) (mem. op.); Damron

v. Citibank (S. D.) N.A., No. 03-09-00438-CV, 2010 WL 3377777, *3 (Tex.
                                        13
App.—Austin Aug. 25, 2010, pet. denied) (mem. op.). If a party fails to object to

the form of an affidavit at trial or obtain a ruling on the objection by the trial court,

the objection is waived on appeal. Vaughn, 792 S.W.2d at 945; Fernandez, 2010

WL 4137491 at *4; Damron, 2010 WL 3377777 at *3.

      Mr. Long is challenging the form of the Boyle Affidavit by arguing that the

attachments to the affidavit have not been properly authenticated as business

records by a person with knowledge. Appellant’s Brief at 13-15.               Mr. Long

objected to the Boyle Affidavit in his response to Deutsche Bank’s motion for

summary judgment, but he failed to obtain any ruling on the admissibility of the

Boyle Affidavit. CR 256-58, 350-51; see Wilson v. Thomason Funeral Home, Inc.,

No. 03-02-00774-CV, 2003 WL 21706065, *5 (Tex. App.—Austin July 24, 2003,

no pet.). Although Mr. Long filed a motion for new trial after the Trial Court

granted summary judgment, he neither presented the Trial Court’s refusal to rule

on his objections as grounds for a new trial, nor asked the Trial Court to rule on his

objections. CR 352-55; Tex. R. App. P. 33.1; Elite Towing, Inc v. LSI Fin. Group,

985 S.W.2d 635, 644 (Tex. App.—Austin 1999, no pet.).

      Consequently, Mr. Long failed to preserve his objections for appeal that the

Boyle Affidavit did not prove-up the attachments as business records of OneWest.

Vaughn, 792 S.W.2d at 945; Damron, 2010 WL 3377777 at *3; Dulong v. Citibank

(S.D.), N.A., 261 S.W.3d 890, 893 (Tex. App.—Dallas 2008, no pet.). Mr. Long

                                           14
therefore cannot now complain to this Court that the Boyle Affidavit is insufficient

summary judgment evidence.       Accordingly, the Boyle Affidavit is competent

summary judgment evidence, and the Trial Court correctly granted summary

judgment for Deutsche Bank on its counterclaim for judicial foreclosure.

            2.     The Boyle Affidavit affirmatively demonstrates the affiant’s
                   personal knowledge.
      To the extent the Court deems Mr. Long’s objections to the Boyle Affidavit

to be objections to the substance of the affidavit that have not been waived, the

Deutsche Bank Defendants contend the Boyle Affidavit is competent summary

judgment evidence. Specifically, the Boyle Affidavit affirmatively shows Mr.

Boyle’s personal knowledge of the facts alleged as the corporate representative of

OneWest, and it properly authenticated the records attached to the affidavit as the

business records of OneWest. As such, the Trial Court did not abuse its discretion

in admitting the Boyle Affidavit as proper summary judgment evidence.

      In order to constitute a substantive defect, affidavit testimony must fail to

establish the basis for the affiant’s personal knowledge of the facts asserted. Tex.

R. Civ. P. 166a(f); In re E.I. DuPont de Nemours & Co., 136 S.W.3d 218, 224

(Tex. 2004) (per curiam); Fernandez, 2010 WL 4137491 at *5.              An affiant

establishes personal knowledge by showing how the affiant became personally

familiar with the facts stated in the affidavit. Dickey v. Club Corp. of America, 12

S.W.3d 172, 176 (Tex. App.—Dallas 2000, pet. denied).                For corporate
                                        15
representatives, personal knowledge may be established through one’s position and

responsibilities with the company. Hydroscience Tech., Inc. v. Hydroscience, Inc.,

401 S.W.3d 783, 791 (Tex. App.—Dallas 2013, pet denied). Moreover, personal

knowledge may be established by references to true and correct copies of

documents in support of the affidavit. Id. at 792. Such documents may include the

business records of the regular activities of a company. Tex. R. Evid. 803(6),

902(10); In re E.I. DuPont, 136 S.W.3d at 224.

      Furthermore, the business records relied on by the affiant may include a

business record created by one entity that later becomes another entity’s primary

record. Dodeka v. Campos, 377 S.W.3d 726, 732 (Tex. App.—San Antonio 2012,

no pet.). A person can testify about another entity’s business records if the

documents were kept in the ordinary course of business, and the documents form

the basis of the underlying transaction. Id. The affiant’s personal knowledge of

the procedures used in originally preparing the documents is not required when the

documents are incorporated into the business of the third party, are relied upon by

the third party, and are shown to be reliable. Roper v. CitiMortgage, Inc., No. 03-

11-00887-CV, 2013 WL 6465637, *13 (Tex. App.—Austin Nov. 27, 2013, pet.

denied) (mem. op.).

      Mr. Long essentially argues the Trial Court erred in admitting the Boyle

Affidavit because it does not meet the Business Records hearsay exception, and

                                        16
thus, does not establish the basis of Mr. Boyle’s personal knowledge independent

of the business records. Appellant’s Brief at 13-15. The Trial Court’s rulings on

the admissibility of summary-judgment evidence are reviewed under an abuse of

discretion standard. Roper, 2013 WL 6465637 at *9. Abuse of discretion is shown

when a trial court acts without regard for guiding rules or principles. Id. The trial

court does not abuse its discretion if its ruling is based on conflicting evidence and

some evidence supports its ruling. Id.     The trial court’s ruling will be upheld if

there is any legitimate basis for the ruling. Id. Accordingly, in order to prevail on

his claim before this Court, Mr. Long must show that the Trial Court’s error

probably resulted in an improper judgment because the judgment turns on the

admission of the Boyle Affidavit. Damron v. Citibank (S. D.) N.A., No. 03-09-

00438-CV, 2010 WL 3377777, *3 (Tex. App.—Austin Aug. 25, 2010, pet. denied)

(mem. op.).

      Contrary to Mr. Long’s assertions, the Trial Court did not abuse its

discretion in admitting the Boyle Affidavit because the affidavit affirmatively

shows the basis for Mr. Boyle’s personal knowledge. First, Mr. Boyle stated that

he has personal knowledge of each of the matters stated in the affidavit. CR 198.

Second, Mr. Boyle stated who he is employed with—OneWest Bank FSB—and in

what capacity—Vice President.         CR 198-99.       Third, the Boyle Affidavit

demonstrates that he has learned of the facts he is testifying to from his corporate

                                         17
position and responsibilities. Id. In regards to the business records relied on by

Mr. Boyle, he states that he is familiar with the records in the regular performance

of his job functions, and the records are maintained by OneWest for the purposes

of servicing mortgage loans. CR 199. Mr. Boyle further testifies that the records

were “made at or near the time by, or from information provided by, persons with

knowledge of the activity and transactions reflected in such records” and the

records are “kept in the regular course of business activity conducted regularly by

OneWest Bank.” Id. Finally, he states that “it is the regular practice of OneWest

Bank’s mortgage servicing business to make these records.”         Id.   Thus, Mr.

Boyle’s testimony substantially complies with the evidentiary requirements for the

authentication of business records. Tex. R. Evid. 902(10); Kyle v. Countrywide

Home Loans, Inc., 232 S.W.3d 355, 360 (Tex. App.—Dallas 2007, pet. denied).

      Additionally, to the extent Mr. Long objects that the business records

attached to the Boyle Affidavit are not the business records of OneWest, the

objection is without merit.       This Court recently confirmed in Roper v.

CitiMortgage, Inc., that a mortgage company who was not the original author or

creator of a mortgage loan documentation may rely on the loan documents if (1)

the documents are incorporated and kept in the course of the mortgage company’s

business, (2) the mortgage company typically relies upon the accuracy of the

documents’ contents, and (3) the circumstance otherwise indicate the documents’

                                        18
trustworthiness.   Roper, 2013 WL 6465637 at *12.          Moreover, a mortgage

company’s financial records are deemed trustworthy because if a mortgage

company fails to keep careful records of its customers’ accounts, “its business

would greatly suffer or even fail,” and the company would be susceptible to

criminal or civil penalties. See Dodeka, 377 S.W.3d at 733.

      While the documents referred to and attached to the Boyle Affidavit were

not created by OneWest, they have been incorporated into and relied upon by

OneWest in its business as the authorized servicer for Deutsche Bank.

Specifically, the Note and Security Instrument became OneWest’s primary

documents for servicing Mr. Long’s home equity loan. CR 198-229. OneWest

would not have been able to service Mr. Long’s loan as the authorized servicer for

Deutsche Bank without incorporating or relying on the Note and Security

Instrument, which Mr. Long does not dispute. Moreover, the documents contain

many indicators of reliability and are deemed trustworthy as the financial records

of the mortgage servicer, which is subject to potential criminal and civil penalties

if the documents are not accurate. See Dodeka, 377 S.W.3d at 733. Mr. Long

likewise does not question the trustworthiness or authenticity of the Note or the

Security Instrument. Thus, OneWest has incorporated the loan documents into its

business records, and relied on the loan documents in servicing Mr. Long’s home

equity loan.

                                        19
      As such, Mr. Boyle is not required to have personal knowledge of the

procedures used in the original preparation of these documents as Mr. Long

contends.   Appellant’s Brief at 14-15; see Roper, 2013 WL 6465637 at *12.

Therefore, the Boyle Affidavit is sufficient summary judgment evidence under the

Business Records exception to hearsay. Accordingly, the Trial Court did not abuse

its discretion in admitting the Boyle Affidavit as summary judgment evidence

since the Boyle Affidavit sufficiently shows the loan documents were incorporated

and kept in the course of OneWest’s business, the accuracy of the loan documents

were relied upon by OneWest’s in the course of it business, and the loan

documents are deemed trustworthy as the financial records of the mortgage

servicer.

      B.    Mr. Long has failed to raise a genuine issue of material fact on
            Deutsche Bank’s counterclaim for judicial foreclosure.
      Mr. Long alleges various issues of fact that he asserts prevent summary

judgment on Deutsche Bank’s judicial foreclosure counterclaim. Specifically, he

alleges that “problems” with the September 2010 foreclosure sale have not been

corrected, Deutsche Bank is not the holder of the Note, Southwest Funding was not

licensed to originate the Note, and the home equity extension of credit exceeded

the fair market value ratio allowed by the Texas Constitution. Appellant’s Brief at

15-16. Contrary to Mr. Long’s assertions, these purported issues are not genuine

issues of material fact to Deutsche Bank’s counterclaim for judicial foreclosure.
                                        20
Accordingly, the Trial Court correctly granted summary judgment for Deutsche

Bank on its counterclaim.

      First, Mr. Long alleges the conditions precedent that were not accomplished

prior to the September 2010 foreclosure still prevent summary judgment on

Deutsche Bank’s counterclaim for judicial foreclosure. Appellant’s Brief at 14-15.

Mr. Long, however, fails to identify the alleged “problems” or failure of conditions

precedent. Arguably, Mr. Long has thus failed to present anything to this Court for

review on this issue. However, if the alleged problem or failure of conditions

precedent to which Mr. Long refers is the purported setting aside of the Rule 736

Order by the Trial Court in September 2010, then this alleged fact issue is not

relevant to Deutsche Bank’s counterclaim for judicial foreclosure. See CR 264.

Specifically, Deutsche Bank asserted its counterclaim for judicial foreclosure in

June 2011 under the applicable version of Texas Rule of Civil Procedure 735,

which provides a counterclaim may be asserted seeking a final judgment that

includes an order allowing foreclosure of a home equity security instrument. CR

27, 332-33, 335-44; Tex. R. Civ. P. 735 (West 2000). Thus, Deutsche Bank could

elect whether to pursue a foreclosure order under Rule 736 or a counterclaim for

judicial foreclosure, and its alleged failure to obtain a Rule 736 foreclosure order

has no bearing on its ability to seek a counterclaim for judicial foreclosure. Tex.

R. Civ. P. 735 (West 2000). Therefore, Mr. Long has not raised a genuine issue of

                                        21
material fact on this issue.

      Second, Mr. Long argues that he has raised a genuine issue of material fact

as to whether Deutsche Bank’s status as the holder of the Note. Appellant’s Brief

at 16. However, Deutsche Bank’s status as holder of the Note is not necessary to

assert a claim for judicial foreclosure of the Security Instrument. As this Court has

previously recognized, “a lien creditor may pursue foreclosure of a lien against real

property under the deed of trust independent of any personal action against the

borrower for collection on the note. Bierwirth v. BAC Home Loans Servicing, L.P.,

No. 03-11-00644-CV, 2012 WL 3793190, *3 (Tex. App.—Austin Aug. 30, 2012,

pet. denied) (mem. op.). Consequently, courts have dismissed claims relying upon

the “show-me-the-note” theory, such as Mr. Long’s, since foreclosure statutes do

not require possession or production of the original note in order to foreclose. Id.

      The summary judgment evidence offered by the Deutsche Bank Defendants

conclusively shows that Deutsche Bank is the beneficiary under the Security

Instrument and the proper party to enforce the Security Instrument through a claim

for judicial foreclosure. CR 200-24. MERS is the designate nominee for the

lender under the Security Instrument, and as such, MERS had the authority to

transfer the rights and interests in the Security Instrument to Deutsche Bank. CR

206; Roper, 2013 WL 6465637 at *8; Bierwirth, 2012 WL 3793190 at *4. MERS

assigned the Security Instrument to Deutsche Bank effective December 22, 2009.

                                         22
CR 223. Therefore, Deutsche Bank had the right and authority to enforce the

Security Instrument as a result of Mr. Long’s default in his repayment obligations

under the Note by seeking a counterclaim for judicial foreclosure in this lawsuit.

Accordingly, Deutsche Bank’s status as the holder of the Note is not material to its

counterclaim for judicial foreclosure, and thus, Mr. Long has failed to raise a

genuine issue of material fact.

      Finally, Mr. Long attempts to raise two fact issues regarding the origination

of his home equity loan by arguing Southwest Funding was not a licensed lender

and the value of the loan exceeded the fair market value ratio mandated by the

Texas Constitution. Appellant’s Brief at 16. Mr. Long, however, fails to present

any credible summary judgment evidence in support of his contentions. The only

evidence offered as to Southwest Funding’s status is a conclusory statement in Mr.

Long’s affidavit and an unverified link purportedly to the Texas Department of

Banking website. CR 264, 303. Similarly, the only evidence of the fair market

value of the Property offered by Mr. Long is an unofficial and uncertified notice of

appraised value for 2009, which is more than two years after his loan was

originated. CR 264, 276, 303, 315; see Tex. R. Evid. 902. Therefore, Mr. Long

failed to present any credible summary judgment evidence to the Trial Court on

these issues, and thus, he failed to raise a genuine issue of material fact preventing

summary judgment on Deutsche Bank’s judicial foreclosure counterclaim.

                                         23
                                   Prayer

     For these reasons, Deutsche Bank, OneWest and IndyMac respectfully

request the Court to affirm the Trial Court’s Order granting their Motion for

Traditional and No-Evidence Summary Judgment.

                                      Respectfully Submitted,

                                      /s/ Bradley E. McLain
                                      J. Garth Fennegan
                                      Texas Bar I.D. 24004642
                                      gfennegan@settlepou.com
                                      Daniel P. Tobin
                                      Texas Bar I.D. 24046978
                                      dtobin@settlepou.com
                                      Bradley E. McLain
                                      Texas Bar No. 24041453
                                      bmclain@settlepou.com
                                      SETTLEPOU
                                      3333 Lee Parkway, Eighth Floor
                                      Dallas, Texas 75219
                                      (214) 520-3300
                                      (214) 526-4145 (Facsimile)

                                      ATTORNEYS FOR APPELLEES,
                                      INDY MAC MORTGAGE SERVICES,
                                      ONEWEST BANK, FSB AND
                                      DEUTSCHE BANK NATIONAL
                                      TRUST CO.




                                     24
                                      Certificate of Compliance

       I hereby certify that: (1) the word count of this document is 5291 words
according to Microsoft Word Version 2010 and excluding those parts of the
document specified in TEX. R. APP. P. 9.4(i)(1); and (2) this document has been
prepared in a conventional typeface no smaller than 14-point for text and 12-point
for footnotes.


                                                      /s/ Bradley E. McLain
                                                      Bradley E. McLain


                                        Certificate of Service

      I certify that this document was served in accordance with the Texas Rules
of Appellate Procedure on June 22, 2015, by the manner indicated upon the
following persons:

Via Electronic Service                             Via Electronic Service

James D. Pierce                                    Brian P. Casey
1 Sugar Creek Center 1080                          Casey Law Group
Sugar Land, Texas 77478                            6836 Bee Caves Rd.
                                                   Building 3, Suite 303
Attorney for Appellant                             Austin, Texas 78746

                                                   Attorney for Appellee,
                                                   Southwest Funding L.P.




                                                   /s/ Bradley E. McLain
                                                   Bradley E. McLain
DMS-#700828-v1-Appellees_Brief.docx




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