Opinion
No. 108,352.
2013-03-8
The BANK OF NEW YORK MELLON, Appellee, v. Jeffery Allen BASLER, et al., (Bret D. Landrith), Appellant.
Appeal from Johnson District Court; James F. Vano, Judge. Ira Dennis Hawver, of Ozawkie, for appellant. David L. Boman, of South & Associates, P.C., of Overland Park, for appellee.
Appeal from Johnson District Court; James F. Vano, Judge.
Ira Dennis Hawver, of Ozawkie, for appellant. David L. Boman, of South & Associates, P.C., of Overland Park, for appellee.
Before ATCHESON, P.J., PIERRON, J., and LARSON, S.J.
MEMORANDUM OPINION
PER CURIAM.
Bret D. Landrith, an alleged successor in interest to the subject property, appeals from the district court's order to strike his pleading from the foreclosure action. He argues that the Bank of New York Mellon (Bank) perpetrated fraud on the court by misrepresenting its right to foreclose and violated the due process rights of the homeowner, Jeffery Allan Basler, by failing to personally serve him with notice of the foreclosure action. We dismiss for lack of jurisdiction.
The Bank filed a foreclosure action against Basler in early 2010. The petition stated that Basler could be served with process by certified mail at 121 West 48th Street, # 606, Kansas City, Missouri, 64112. The docket sheet shows that all parties to the foreclosure action were personally served except Basler.
Basler did not appear at the hearing on the Bank's foreclosure petition. The district court found that Basler had been properly served and notice of the lawsuit had been properly published. The court also set the redemption period at 3 months from the date of the Sheriff's sale and held that Basler was forever barred from claiming any interest in the property upon expiration of the redemption period. The court entered a judgment of foreclosure on April 27, 2010, which included a judgment for the Bank in the amount of $671,999.82, plus interest and other costs, and a ruling that the Bank had a first and prior mortgage lien upon Basler's property.
The property was sold on April 21, 2011, and the district court issued a certificate of purchase on August 4, 2011, once the redemption period had expired. Within a few days, the court received notice of a successor in interest and a motion for extension of time to answer the Bank's foreclosure petition. The notice stated that Landrith was a successor in interest because Basler had conveyed the property to him by quitclaim deed. The notice explained that Landrith verified Basler's ownership of the property by searching the Johnson County register of deeds and civil action database. A copy of the quitclaim deed, executed on August 1, 2011, was attached to the notice.
About a month later, Landrith filed an answer to the Bank's foreclosure petition. The answer claimed that the Bank did not have possession of Basler's mortgage note and perpetrated fraud on the court by misrepresenting its right to foreclose. That same day, Landrith also filed a motion for relief from the foreclosure judgment under K.S.A. 60–309, alleging that Basler had been unaware of the foreclosure action and was served only by publication. Landrith attached an affidavit stating that he had no actual knowledge of the foreclosure action before paying $6,000 for the quitclaim deed, and he located Basler at “the last address of the registered owner,” which was in the Plaza area of Kansas City, Missouri. Landrith also attached a 2010 United States Bankruptcy Court decision deeming a mortgage note unenforceable under the Uniform Commercial Code due to lack of possession.
The Bank moved to strike Landrith's pleadings. The motion stated that the Bank attempted to serve Basler at his last known address but the certified mailing was returned undelivered, so it served him by publication. The motion also claimed that Landrith's pleadings should be stricken because he had no valid interest in the property, was not a named party, and had no standing to challenge the foreclosure.
After a hearing, the district court found that Landrith lacked standing to challenge the foreclosure because the quitclaim deed had been executed after Basler's property rights had been extinguished. Consequently, the court struck both of Landrith's pleadings on November 21, 2011. Landrith did not appeal.
In late April 2012, Landrith filed an amended motion for relief from the foreclosure judgment under K.S.A. 60–260(b)(3). The motion claimed that the Bank had perpetrated fraud on the court by misrepresenting its right to foreclose and the United States and Kansas Constitutions had been violated by the Bank's service by publication when Basler's residential address was known. Attached to the motion was a proposed settlement agreement in a New York case between the Bank and institutional investors, which identified the specific trust containing Basler's mortgage note and, according to Landrith, demonstrated the Bank's knowledge of deficiencies in the transfer of mortgage notes. Also attached was a New York Supreme Court order in a fraud action against the Bank, filed by Landrith 3 days after his pleadings were stricken from Basler's foreclosure case. The New York court dismissed Landrith's fraud action without prejudice based on forum non conveniens.
Again, the Bank responded by moving to strike Landrith's motion due to lack of standing. And again, the district court agreed, striking his motion on June 13, 2012. The court found that Landrith had “presented no new evidence or demonstration that the previous ruling of the court regarding his standing [was] in error” and Landrith had “inserted himself into the litigation and made unsubstantiated allegations against the Plaintiff and Plaintiffs counsel and has failed to follow applicable law and procedures.” Landrith timely appeals.
Landrith argues that the district court should have granted his motion for relief from foreclosure due to fraud on the court and lack of personal service. The Bank counters that Landrith can only appeal the denial of his motion for relief from foreclosure, not the underlying foreclosure, and the court correctly denied his motion due to lack of standing.
Whether jurisdiction exists is a question of law over which an appellate court's scope of review is unlimited. Associated Wholesale Grocers, Inc. v. Americold Corporation, 293 Kan. 633, 637, 270 P.3d 1074 (2011). We have a duty to question jurisdiction on its own initiative. When the record discloses a lack of jurisdiction, we must dismiss the appeal. See State v. Comprehensive Health of Planned Parenthood, 291 Kan. 322, 352, 241 P.3d 45 (2010).
Basler's mortgage was foreclosed on April 27, 2010, his property was sold on April 21, 2011, his redemption rights expired 3 months later, and he quitclaimed his interest in the property to Landrith on August 1, 2011. Therefore, if the redemption period was May 1, 2011, to August 1, 2011, it could be argued that Basler quitclaimed his property interest, along with his appeal rights, to Landrith. Landrith never exercised Basler's right to redeem, but he did exercise his right to appeal.
A judgment of foreclosure is final for purposes of appeal if it determines the rights of the parties, the amounts to be paid, and the priority of the claims. Bank IV Wichita v. Plein, 250 Kan. 701, 707, 830 P.2d 29 (1992) (citing Stauth v. Brawn, 241 Kan. 1, Syl. ¶ 1, 734 P.2d 1063 [1987] ). Accordingly, a party must appeal a judgment of foreclosure within 30 days or it is precluded from raising the issue later. K.S.A. 60–2103(a) (appeal must be taken within 30 days of entry of judgment). Here, Basler's right to appeal the judgment of foreclosure expired in late May 2010. But he had until April 27, 2012, to claim fraud on the court and to file for relief from a judgment entered on publication rather than personal service. See K.S.A.2012 Supp. 60–309(a) (2–year statute of limitation on action for relief from default judgment entered on service by publication); K.S.A. 60–513(a)(3) (2–year statute of limitation on fraud action); K.S.A.2012 Supp. 60–260(d)(2)–(3) (K.S .A 60–260[c][1] time limits inapplicable to actions for relief from judgment entered without personal service or procured by fraud on the court). Therefore, Landrith's answer asserting fraud on the court as a foreclosure defense and his petition for relief from a foreclosure entered on publication service were both timely.
The district court struck Landrith's answer and motion for relief from foreclosure on November 21, 2011. An order to strike is an appealable order when it has “the features of finality by serving the same purpose as a demurrer to test the sufficiency of a claim or defense.” State ex rel. Topeka Police Dept. v. $895.00 U.S. Currency, 281 Kan. 819, 831, 133 P.3d 91 (2006) (order to strike BIDS's claim for lack of standing had all features of finality in that it fully adjudicated all interests claimed and, thus, was appealable order). Instead of appealing the order to strike, Landrith filed a fraud claim against the Bank in New York state court. After his New York action was dismissed, he filed another fraud and lack of personal service claim in Kansas state court. Once the district court struck that pleading, Landrith appealed.
In both his 2011 answer and his 2012 motion, Landrith claimed that the Bank had perpetrated fraud on the court by misrepresenting its right to foreclose Basler's mortgage. Also, in both his 2011 and 2012 motions, Landrith claimed the Bank had violated Basler's due process rights by failing to personally serve him with notice of the foreclosure proceeding. Because Landrith filed another pleading raising the same issues rather than appealing the order to strike his 2011 pleadings, res judicata bars this court's consideration of his appeal. See Waterview Resolution Corp. v. Allen, 274 Kan. 1016, 1023, 58 P.3d 1284 (2002) (res judicata prevents relitigation when there is [1] identity in the thing sued for, [2] identity of the cause of action, [3] identity of persons and parties to the action, and [4] identity in the quality of persons for or against whom claim is made).
We lack jurisdiction to hear Landrith's second fraud and notice claim because he failed to appeal the district court's striking of his first fraud and notice claim.
Appeal dismissed.