MONTANO V. BANK OF AMERICA, N.A.
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FRED MONTANO,
Petitioner-Appellant,
v.
BANK OF AMERICA, N.A.,
SUCCESSOR BY MERGER TO
BAC HOME LOAN SERVICING,
L.P., FKA COUNTRYWIDE HOME
LOANS, L.P., and FANNIE MAE,
Respondents-Appellees,
COURT OF APPEALS OF NEW MEXICO
APPEAL FROM THE DISTRICT COURT OF BERNALILLO COUNTY, Clay
Campbell, District Judge
Fred Montano, Rio Rancho, NM, Pro Se
Appellant
Weinstein & Riley, PS, Jason C.
Bousliman, Albuquerque, NM, for Appellees
M. MONICA ZAMORA, Judge. WE CONCUR: LINDA
M. VANZI, Chief Judge, JAMES J. WECHSLER, Judge
{1} Petitioner Fred
Montano, a self-represented litigant, appeals from the district court’s order
granting Respondent Bank of America, N.A.’s motion to dismiss and dismissing
the complaint with prejudice. In this Court’s notice of proposed disposition,
we proposed to summarily affirm. Appellant filed a memorandum in opposition
(MIO), which we have duly considered. Remaining unpersuaded, we affirm the
district court’s order granting Respondent’s motion to dismiss and dismissing
the complaint with prejudice.
{2} In his docketing
statement, Appellant raised four issues: the district court erred (1) by
ignoring Appellant’s rescission of the note and mortgage; (2) by ignoring the
fact that Respondent did not prove it had the right to enforce the note, a
burden established by the New Mexico Supreme Court; (3) because subject matter
jurisdiction may be raised at any time and is not subject to doctrines of res
judicata and collateral estoppel; and (4) in ruling that res judicata and
collateral estoppel apply. [DS 5;
see also DS 6, 10, 11] With
regard to issues two through four, in our notice of proposed disposition, we
proposed to conclude that the district court did not abuse its discretion in
applying collateral estoppel and correctly applied res judicata to bar
re-litigation of whether Respondent had standing to bring the prior case [CN
5], and that, accordingly, we need not address whether Respondent had the right
to enforce the note, and whether it had standing to foreclose because these
issues have already been addressed and resolved in the prior case [CN 5–6;
see
also, e.g., RP 59–72 (this Court’s memorandum opinion in the prior case
addressing,
inter alia, standing)].
{3} In his MIO, Appellant
does not respond to our proposed disposition with regard to collateral estoppel
and res judicata aside from simply contending that, although standing was
raised in the prior case, that court granted summary judgment on the pleading
without requiring Respondent to prove standing, so its judgment is void because
it did not consider the issue. [MIO 3-4] In other words, Appellant essentially
contends that, because the district court
erred in determining that
Respondent had standing, the preclusion doctrines do not apply. As Appellant
cites no authority for this contention, we assume none exists.
See Curry v.
Great Nw. Ins. Co.,
2014-NMCA-031, ¶ 28,
320 P.3d 482 (“Where a party
cites no authority to support an argument, we may assume no such authority exists.”).
Moreover, to the extent Appellant fails to actually address the merits of the
collateral estoppel and res judicata arguments, we consider such issues
abandoned.
See State v. Johnson,
1988-NMCA-029, ¶ 8,
107 N.M. 356,
758 P.2d 306 (explaining that, when a case is decided on the summary calendar,
an issue is deemed abandoned when a party fails to respond to the proposed
disposition of that issue). Additionally, although Appellant does make
additional standing and jurisdictional arguments, we do not address these
issues because, as noted above and in our notice of proposed disposition, such
arguments are precluded from reconsideration by the doctrines of collateral
estoppel and res judicata. [
See CN 2-6]
{4} The only argument
remaining is whether Appellant’s attempted rescission of the note is valid. In
our notice of proposed disposition, we noted that, although the district court
did not expressly rule on this issue, we nonetheless proposed to affirm under
the “right for any reason” doctrine.
See Cordova v. World Fin. Corp. of N.M.,
2009-NMSC-021, ¶ 18,
146 N.M. 256,
208 P.3d 901 (stating that “it is
established law that our appellate courts will affirm a district court’s
decision if it is right for any reason, so long as the circumstances do not
make it unfair to the appellant to affirm”). [CN 6] We then proceeded to
explain that the right to rescission expires three years after the date of
consummation of the transaction or upon the sale of the property, whichever
occurs first, and that, as such, in the present case, because the transaction
consummated on May 7, 2003 [RP 28], the right to rescission expired on May 7,
2006. [CN 6-7]
See 15 U.S.C. § 1635(a), (f) (2012);
Beach
v. Ocwen Fed. Bank, 523 U.S. 410, 415-19 (1998) (discussing the federal
right to rescind and concluding that “the Act permits no federal right to
rescind, defensively or otherwise, after the 3-year period of § 1635(f)
has run”).
{5} In his MIO,
Appellant continues to argue that his right to rescission is absolute and
complete upon his having mailed notice of such rescission to Respondent; that
this Court and the district court may not review such exercise of his
right—notwithstanding the fact that Appellant brought the petition before the
district court to enforce such rescission and appealed the district court’s
dismissal to this Court; and that there is no evidence that the transaction has
consummated because the note is void since it was purportedly rescinded, a
circular argument in which Appellant expends much focus on this Court’s use of
the word “appears.” [
See MIO 4-21] We first briefly address
Appellant’s argument regarding the date of consummation. [
See MIO
4-5, 8] The transaction in the present case was consummated on May 7, 2003, as
indicated by the executed note attached to Appellant’s complaint. [RP 28-30] As
the Code of Federal Regulations defines “consummation” as “the time that a
consumer becomes contractually obligated on a credit transaction[,]” 12 C.F.R.
§ 226.2(a)(13) (2012), and as the borrower, Appellant’s predecessor in
interest [RP 8, 135, 176], became contractually obligated on the date she
signed the promissory note, this is simply definitional. The note is evidence
of consummation, and we are aware of no
evidence in the record, and
Appellant points us to no
evidence in the record, that undermines this.
Accordingly, as previously suggested, we now conclude that the transaction was
consummated on May 7, 2003.
{6} Second, we address
Appellant’s argument that consummation
and delivery of all required
disclosures and their acceptance must occur before the three-year expiration of
the right to rescind commences. [
See MIO 5, 8] As noted by Appellant and
as we stated in our calendar notice, 15 U.S.C. § 1635(f) (2012) states, in
pertinent part, that
[a]n obligor’s right of rescission
shall expire three years after the date of consummation of the transaction or
upon the sale of the property, whichever occurs first, notwithstanding the
fact that the information and forms required under this section or any other
disclosures required under this part have not been delivered to the obligor[.]
(Emphasis added.) [MIO 5] Appellant apparently misunderstands
the meaning of the word “notwithstanding” in his argument that delivery of all
disclosures and their acceptance are required before the three-year expiration
period begins. [MIO 5] “Notwithstanding” means “despite” or “in spite of.” Black’s
Law Dictionary 1231 (10th ed. 2014). Thus, Section 1635(f) in fact states
that the right of rescission expires three years after consummation or upon the
sale of the property, whichever occurs first, despite the fact that such
disclosures have not been delivered. In other words, not only is it not a
requirement that such disclosures be delivered before the three-year period
begins to run, but the opposite is true—the three-year period begins to run
even if such disclosures have not been delivered. See id.
{7} Finally, we address
the bulk of Appellant’s argument: that rescission is effective upon mailing of
the notice of such rescission; that, absent a lawsuit by a lender disputing
such rescission, it is an absolute right requiring or allowing no judicial
review; and that the three-year period discussed in Section 1635(f) is not
relevant to whether the rescission itself is effective. [
See MIO 6–8,
9–13, 15–18, 19–21] The only law Appellant cites purportedly in support of his
argument that the courts do not have jurisdiction to review the validity of
rescission is
Jesinoski v. Countrywide Home Loans, Inc., ___ U.S. ___,
135 S. Ct. 790 (2015).
Jesinoski neither states nor stands for the
proposition that courts have no authority to review a petitioner’s efforts to
enforce a notice of rescission.
See generally id. [
See RP 8
(petition by Appellant seeking to enforce notice of rescission in the district
court)] Indeed, such a conclusion is counter-logical. As Appellant cites no
other authority, we assume none exists.
See Curry,
2014-NMCA-031,
¶ 28. As such, we proceed to consider whether Appellant’s rescission is
effective upon mailing of his notice or whether the three-year expiration date
bars such attempted rescission.
{8} As we explained in
our calendar notice, although Section 1635(a) provides obligors with a right to
rescind a transaction in certain circumstances, Section 1635(f) limits such right
by stating that it “shall expire three years after the date of consummation of
the transaction or upon the sale of the property, whichever occurs first[.]”
See
also Beach, 523 U.S. at 415-19 (discussing the federal right to rescind and
concluding that “the Act permits no federal right to rescind, defensively or
otherwise, after the [three]-year period of [Section] 1635(f) has run”).
[CN 6-7] Appellant contends that
Jesinoski somehow overrides this
limitation because it addresses
how rescission is effective, not
when. [
See MIO 9, 15] However,
Jesinoski expressly
states that the “
conditional right to rescind does not last
forever. Even if a lender never makes the required disclosures, the right of
rescission
shall expire three years after the date of consummation of
the transaction or upon the sale of the property, whichever comes first.” 135
S. Ct. at 792 (citing Section 1635(f)). Thus, the United States Supreme Court
made clear that, although Section 1635(f) does not change the fact that the
borrower need not sue in order to effectuate the right—i.e., that the right is
effective upon notice mailed—the right is
still conditioned upon the
three-year period set forth in Section 1635(f).
See Jesinoski, 135 S.
Ct. at 792 (stating that the right expires three years after the date of
consummation of the transaction, that there is “no doubt that rescission is
effected when the borrower notifies the creditor of his intention to rescind[,]
. . .
so long as the borrower notifies within three years after
the transaction is consummated,” and that Section 1635(f) “tells us
when
the right to rescind must be exercised” (first emphasis added)).
Jesinoski
clearly reiterates what Section 1635(f) and
Beach have already made
clear: the right to rescind only exists for three years after the transaction
has been consummated.
See Jesinoski, 135 S. Ct at 792;
Beach, 523
U.S. at 415-19;
see also Section 1635(f). As the transaction in the
present case commenced on May 7, 2003, the time within which Appellant or his
predecessor in interest was permitted to exercise his or her right of
rescission expired three years later, on May 7, 2006. Appellant’s arguments to
the contrary are unpersuasive. As Appellant had no right of rescission on
January 18, 2011, when he attempted to exercise such right [RP 11], such
attempt was invalid. Thus, Appellant’s complaint was properly dismissed with
prejudice.
{9} Accordingly, for
the reasons stated in our notice of proposed disposition and herein, we affirm
the district court’s order granting Respondent’s motion to dismiss and
dismissing the complaint with prejudice.
LINDA M. VANZI, Chief Judge