     Case: 17-11135      Document: 00514853096         Page: 1    Date Filed: 02/27/2019




           IN THE UNITED STATES COURT OF APPEALS
                   FOR THE FIFTH CIRCUIT
                                                                      United States Court of Appeals
                                                                               Fifth Circuit


                                    No. 17-11135
                                                                             FILED
                                                                      February 27, 2019
                                  Summary Calendar
                                                                        Lyle W. Cayce
                                                                             Clerk
WATERFALL VICTORIA MASTER FUND LIMITED,

              Plaintiff - Appellee

v.

CLIFFORD C. AVERY, ROSSIA L. AVERY,

              Defendants - Appellants



                   Appeal from the United States District Court
                        for the Northern District of Texas
                              USDC No. 3:16-CV-173


Before JOLLY, COSTA, and HO, Circuit Judges.
PER CURIAM: *
       Waterfall Victoria Master Fund filed for judicial foreclosure of its
mortgage lien on Clifford and Rossia Avery’s property. Following a bench trial,
the court held Waterfall Victoria was entitled to a foreclosure order.
       Defendants argue on appeal that no evidence supported the district
court’s conclusion that Waterfall Victoria’s lien complied with the Texas
Constitution’s strict requirements for liens on homesteads. TEX. CONST., ART.


       * Pursuant to 5TH CIR. R. 47.5, the court has determined that this opinion should not
be published and is not precedent except under the limited circumstances set forth in 5TH
CIR. R. 47.5.4.
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                                 No. 17-11135
XVI, § 50(a)(6). A noncompliant lien is considered void and unenforceable
unless the defect is cured. Wood v. HSBC Bank USA, N.A., 505 S.W.3d 542,
548–49 (Tex. 2016). These constitutional provisions do not, however, create
any substantive rights—the requirements “only assume constitutional
significance when their absence in a loan's terms is used as a shield from
foreclosure.” Garofolo v. Ocwen Loan Servicing, L.L.C., 497 S.W.3d 474, 478
(Tex. 2016). Texas courts thus require that a homeowner expressly assert
constitutional problems as a defense to a foreclosure action. See Hinton v.
Nationstar Mortgage, 533 S.W.3d 44, 50 (Tex. App.—San Antonio 2017, no pet.)
(refusing to review an allegation that a lien was not constitutionally compliant
because a court “may not consider a claim for affirmative relief or an
affirmative defense unless it is pled or tried by consent”); Wilson v. Aames
Capital Corp., No. 14-06-00524-CV, 2007 WL 3072054, *1 (Tex. App. 14th
Dist.—Houston, Oct. 23, 2007, no pet.) (describing challenges to the
constitutional compliance of a lien as “in the nature of an affirmative defense”
that must be pled in order to be preserved).
      In the district court, Defendants never asserted constitutional problems
with the lien as a defense to the foreclosure action. They raised five other
defenses, including challenging the validity of Waterfall Victoria’s legal title
and arguing that they did indeed make the required tax payments. Defendants
try and point to their general denial of an allegation in Waterfall Victoria’s
complaint that asserted the lien conformed to all constitutional requirements.
But that paragraph of the complaint raised numerous allegations, including
that Avery was in default and was not a member of the United States military.
A one-sentence denial making no mention of any constitutional infirmity is not
sufficient to put the district court on notice of this affirmative defense.
Arismendez v. Nightingale Home Health Care, Inc., 493 F.3d 602, 610 (5th Cir.
2007) (explaining that affirmative defenses must be raised in the defendant’s
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                                  No. 17-11135
responsive pleadings or at another “pragmatically sufficient” time that avoids
any unfair surprise to the plaintiff); see also FDIC v. Mijalis, 15 F.3d 1314,
1327 (5th Cir. 1994) (explaining that a party “must press and not merely
intimate the argument during the proceedings before the district court”). Nor
did any later filings in the district court litigation, including the Joint Pretrial
Order, Trial Brief, or Proposed Findings of Facts and Conclusions of Law, make
mention of a defense based on the lien’s noncompliance with the state
constitution. The constitutional defense was forfeited.
      AFFIRMED.




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