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JPMorgan Chase Bank, N.A. v. Claybridge Homeowners Ass'n, Inc.

Court of Appeals of Indiana

October 22, 2014

JPMORGAN CHASE BANK, N.A., Appellant-Intervenor,
v.
CLAYBRIDGE HOMEOWNERS ASSOCIATION, INC., Appellee-Plaintiff.
v.
DEBORAH M. WALTON, et al., Appellees-Defendants

APPEAL FROM THE HAMILTON SUPERIOR COURT. The Honorable J. Richard Campbell, Judge. Cause No. 29D04-0801-MF-31.

ATTORNEY FOR APPELLANT: J. DUSTIN SMITH, Plunkett Cooney, P.C., Indianapolis, Indiana.

ATTORNEYS FOR APPELLEE: WHITNEY L. MOSBY, KARL L. MULVANEY, Bingham Greenebaum Doll LLP, Indianapolis, Indiana.

BROWN, Judge. BARNES, J., and BRADFORD, J., concur.

OPINION

Page 325

BROWN, Judge

JPMorgan Chase Bank, N.A., (" JPMorgan" ) appeals the trial court's order of January 16, 2014, denying its December 19, 2013 " Combined Motion to Intervene, to Stay January 9, 2014 Sheriff Sale, to Vacate Order of Sale, to Vacate the May 27, 2010 Summary Judgment and Decree of Foreclosure, and Request for Expedited Hearing on Motion." Appellant's Appendix at 1. JPMorgan raises three issues, which we consolidate and restate as whether the court erred in denying its motion. We reverse and remand.[1]

FACTS AND PROCEDURAL HISTORY

In October 2001, Claybridge Homeowners Association, Inc., (" Claybridge" ) filed a complaint against Deborah Walton, who lived in a house located on certain real property (the " Real Estate" ) in the Claybridge subdivision in Hamilton County. Walton v. Claybridge Homeowners Ass'n, Inc., No. 29A05-1006-MF-399 (Ind.Ct.App. Jan. 20, 2011) (the " 2011 Opinion" ), trans. denied. Deborah later filed a counterclaim against Claybridge. Id. In 2002, Claybridge obtained an injunction against Deborah to prevent her from interfering with Claybridge's performance of duties under the subdivision's covenants.[2] Id.

On July 15, 2004, the trial court entered an order awarding damages to Claybridge in the amount of $248 for damages, $64,600 for attorney fees, and the cost of suit in the action against Deborah.[3] Id. The court declined to enter a final judgment because Deborah's counterclaim was pending. Id. On December 4, 2006, the court entered judgment in favor of Claybridge on Deborah's counterclaim.[4] Id.

Page 326

On January 16, 2007, the trial court entered an order (the " January 2007 Order" ) entitled " Order Vacating Hearing on Additional Attorneys Fees and Certification of Final Judgment," which stated as follows:

Comes now the Court upon the Motion of Claybridge [] to vacate the hearing on its request for additional attorneys fees and to designated [sic] this matter as a final judgment.
The Court, having considered said motion and being duly advised in the premises, now finds that such motion should be and hereby is GRANTED.
IT IS, THEREFORE, ORDERED, ADJUDGED AND DECREED that the hearing set for January 17, 2007, is VACATED. This Order shall not affect the prior award of damages, trial court and appellate attorney fees, nor shall this Order prevent Claybridge [] from seeking additional collection costs in enforcing the prior award of attorney fees or pre and post judgment interest. This Court further certifies this matter as a final judgment pursuant to Ind. T.R. 58.

Appellee's Appendix at 70-71. This Order was not entered in the trial court's judgment docket. 2011 Opinion. At the time, the recorded deed reflecting the owner of the Real Estate was a quitclaim deed (the " 2001 Quitclaim Deed" ) dated June 27, 2001, and recorded with the Hamilton County Recorder on July 10, 2001, conveying the Real Estate to Deborah. A quitclaim deed (the " 2007 Quitclaim Deed" ) dated June 28, 2001, was recorded with the Hamilton County Recorder on April 12, 2007. Deborah conveyed the Real Estate by the 2007 Quitclaim Deed to herself and her mother Margaret as joint tenants with rights of survivorship.

On October 30, 2007, Claybridge filed a Complaint to Foreclose Judicial Lien (the " Foreclosure Complaint" ) alleging that the court's July 15, 2004 order was a valid lien against the Real Estate and that it was entitled to enforce its terms. Id. The Foreclosure Complaint named a number of defendants, including Margaret, Fifth Third Mortgage Company (" Fifth Third" ), which had recorded a mortgage on the Real Estate on April 11, 2006 (the " Fifth Third Mortgage" ), and First Indiana Bank, N.A. (" First Indiana" ), which had recorded a mortgage on the Real Estate on June 16, 2006 (the " First Indiana Mortgage" ).[5] Id. The Foreclosure Complaint alleged in part:

9. Margaret is named as a defendant in this proceeding to answer as to any interest which she may have in the Real Estate as a result of the [2007 Quitclaim Deed] dated June 28, 2001, and recorded on or about April 12, 2007, as Instrument No. 2007-020527 in the Office of Hamilton County, Indiana. The interest of Margaret, if any, is inferior and subordinate to that of Claybridge.
10. [Fifth Third] is named as a defendant to answer as to any interest it may claim in the Real Estate as the result of a Mortgage dated March 22, 2006, and recorded April 11, 2006, by and between Deborah and American Fidelity Mortgage, Inc. which Mortgage [(the " Fifth Third Mortgage" )] was assigned to [Fifth Third] by way of an Assignment recorded on or about April 11, 2006, as Instrument No. 2006-19263. The interest of [Fifth

Page 327

Third], if any, is inferior and subordinate to that of Claybridge.

Appellee's Appendix at 2-3. Claybridge requested that its judgment be declared a valid lien against the Real Estate, a judgment of foreclosure of the lien, and an order directing the sale of the Real Estate.

Also on October 30, 2007, Claybridge filed a Lis Pendens Notice stating that it had filed a Foreclosure Complaint for foreclosure of a judicial lien in its favor which may result in a sale of the Real Estate. The Lis Pendens Notice, dated and file-stamped October 30, 2007, in the record includes a handwritten notation on the second page stating " Lp 10 pg 84." Appellant's Appendix at 79. The chronological case summary (the " CCS" ) indicates Deborah and Margaret were each personally served with the Foreclosure Complaint and a summons on November 7, 2007.

On November 13, 2007, Deborah and Margaret executed a promissory note in the amount of $473,000 in favor of Washington Mutual Bank, and the note was secured by a mortgage on the Real Estate, executed by Deborah and Margaret and recorded on November 27, 2007 (the " JPMorgan Mortgage" ).[6] JPMorgan, according to its December 19, 2013 motion to intervene discussed below, is the successor in interest to Washington Mutual Bank and the holder of the JPMorgan Mortgage.

Deborah and Margaret, by counsel, filed an Answer on May 8, 2009, in which they admitted that, on or about July 15, 2004, Deborah was the owner of the Real Estate, that on that date the court entered a judgment in favor of Claybridge and against Deborah, that the judgment was a valid lien against the Real Estate, and that Claybridge was the holder of the judgment.[7] On September 18, 2009, Claybridge filed a motion for summary judgment and a motion for default judgment and decree of foreclosure. Fifth Third did not appear or respond to the Foreclosure Complaint, the trial court issued an order of default judgment against Fifth Third with a file-stamped date of September 30, 2009, and the CCS does not indicate Fifth Third appealed the default judgment.[8] In January 2010, counsel for Deborah withdrew from the case and Deborah, pro se, subsequently moved to dismiss the Foreclosure Complaint on the basis that there was no valid, final judgment by which a judgment lien could have been established. 2011 Opinion. The trial court, while agreeing that the July 15, 2004 order did not constitute a final judgment, nonetheless denied the motion to dismiss, noting the January 2007 Order. Id.

On May 19, 2010, the court signed an order, which was file-stamped on May 27, 2010, titled Summary Judgment Entry and Decree of Foreclosure in Favor of Claybridge (the " Foreclosure Decree" ). The court entered summary judgment in favor of Claybridge and against Deborah, Margaret, and First Indiana, ordered a foreclosure sale of the Real Estate, and gave priority to Claybridge's judgment lien over

Page 328

the First Indiana Mortgage. Id. at 2. The Foreclosure Decree ordered in part:

1. That [Claybridge] be, and it hereby is, granted an in rem judgment against Deborah M. Walton, Margaret J. Walton, and First Indiana Bank, in the principal sum of $64,848.00, plus statutory interest from July 15, 2004 to and including the date of the entry of summary judgment, plus advances for real estate taxes, assessments, insurance premiums and any necessary expenses to preserve and protect the Real Estate [] incurred to date of Sheriff's sale and including court costs, ...

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