Chase Home Fin., L.L.C., et al. v. Hobson
| Docket Number: | 2011-IA-00358-SCT | |
| Oral Argument: | 12-05-2011 | |
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| Supreme Court: | Opinion Link Opinion Date: 03-01-2012 Opinion Author: Waller, C.J. Holding: DA-Reversed and remanded; CA-Affirmed. |
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| Additional Case Information: |
Topic: Contract - Foreclosure sale - Reinstatement of loan - Section 89-1-59 Judge(s) Concurring: Carlson and Dickinson, P.JJ., Randolph, Lamar, Kitchens, Chandler, Pierce and King, JJ. Procedural History: Interlocutory Appeal Nature of the Case: CIVIL - CONTRACT |
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| Trial Court: |
Date of Trial Judgment: 02-18-2011 Appealed from: Warren County Circuit Court Judge: Isadore Patrick Disposition: Affirmed in part and reversed in part the county court’s grant of summary judgment for Plaintiff. Case Number: 10,0001-CI |
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| Party Name: | Attorney Name: | Brief(s) Available: | ||
| Appellant: | Chase Home Finance, L.L.C. and Priority Trustee Services of Mississippi, L.L.C. |
ALICIA S. HALL
C. LEE LOTT, III
MARK H. TYSON |
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| Appellee: | James D. Hobson, Jr. | KENNETH B. RECTOR ALLISON M. BREWER | ||
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| Topic: | Contract - Foreclosure sale - Reinstatement of loan - Section 89-1-59 |
| Summary of the Facts: | In 1996, Deborah Hood Quimby executed a deed of trust securing indebtedness on, and conveying a security interest in property. The deed eventually was assigned to Chase Home Financing, LLC, which appointed Priority Trustee Services of Mississippi, LLC, as substitute trustee. Quimby defaulted on her loan payments, and Chase scheduled a foreclosure sale on the property for March 20, 2008. At some time prior to the foreclosure sale, Quimby allegedly cured her default and reinstated her loan. Chase alleges that it attempted to communicate the reinstatement to the crier of the foreclosure sale, but was unsuccessful. James Hobson, Jr. appeared at the foreclosure sale and offered the highest bid at $60,948.82. Hobson tendered to Chase’s agent a cashier’s check in this amount. Chase gave Hobson a receipt for the sale. About two weeks later, Chase returned Hobson’s check and refused to tender a deed to the land, stating that the foreclosure sale had been cancelled due to Quimby’s reinstatement. Hobson filed a complaint against Chase, alleging breach of contract. Subsequently, each party filed a motion for summary judgment. The county court granted Hobson’s motion for summary judgment and denied Chase’s motion. The court found that Hobson was entitled to $95,051.18 in damages. The court also awarded Hobson $10,868.60 in attorney’s fees and expenses, finding that Chase’s breach was grossly negligent. Chase appealed, and the circuit court affirmed. The Supreme Court granted an interlocutory appeal. |
| Summary of Opinion Analysis: | Chase argues that the circuit court erred in affirming summary judgment as to Chase’s liability. Both the county and circuit courts appear to have focused on the actions taken by the parties on the courthouse steps at the foreclosure sale. Each court determined the parties had formed a contract for the purchase and sale of property. Neither court, though, addressed the central matter at issue in this case – whether Quimby, the borrower, reinstated her loan prior to the foreclosure sale. Mississippi law protects a borrower’s right to reinstate his or her loan up until the moment a foreclosure sale is made. Under section 89-1-59, once a borrower reinstates his or her loan, the mortgagee no longer has the right to sell the property. If Quimby did, in fact, reinstate her loan prior to the foreclosure sale, then she was no longer in default and Chase could not convey the property at the foreclosure sale, pursuant to section 89-1-59. If Chase conducted the sale without statutory authority, then the foreclosure sale was void. If the sale was void, then Hobson did not acquire anything at the sale and does not have a claim for breach of contract. However, whether and when Quimby reinstated her loan remains a disputed issue of fact at this stage of the litigation. Absent from the record is a copy of Quimby’s check or any other indication of payment made to cure her default. On remand, the trial court should first determine whether Quimby reinstated her loan prior to the foreclosure sale. If she did, then Hobson’s breach-of-contract claim fails, and judgment should be entered for the defendants. When a circuit court’s affirmance of a county court’s grant of summary judgment is reversed, the case is remanded to county court. |
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