Dean Blair and Paula Blair, Appellants/Cross-Appellees -Defendants/Counterclaimants,
EMC Mortgage, LLC, Appellee/Cross-Appellant-Plaintiff/Counterclaim Defendant.
from the Vanderburgh Superior Court The Honorable Richard G.
D'Amour, Judge Trial Court Cause No. 82D07-1207-MF-3333
ATTORNEY FOR APPELLANTS Robert R. Faulkner Evansville,
ATTORNEYS FOR APPELLEE David J. Jurkiewicz Nathan T.
Danielson Christina M. Bruno Bose McKinney & Evans LLP
Dean and Paula Blair ("the Blairs") appeal the
trial court's order that foreclosed their interest in two
mortgaged properties and that entered a money judgment for
EMC Mortgage, LLC ("EMC"). The Blairs raise eight
issues, but we reach only one: whether the trial court erred
in granting only partial relief to the Blairs on their
On cross appeal, EMC raises one issue: whether the trial
court erred in not entering summary judgment for EMC where
the Blairs' request for more time to respond to EMC's
motion for summary judgment was not timely.
and Procedural History
On December 21, 1992, the Blairs signed a promissory note in
the principal amount of $110, 300.00 in favor of United
Companies Lending Corporation ("UCLC") ("the
Note"). Appellants' App. Vol. 2 at 57-60.
The Note contained an optional acceleration clause, which
allowed UCLC to decide whether to accelerate the loan balance
following a default. Id. at 58. The Note was secured
by a mortgage ("the Mortgage") on two properties,
one at 916 Wortman Road, Evansville, Indiana and the other at
2237 Herbert Avenue, Evansville, Indiana. Id. at 62;
Tr. Vol. II at 23-24. The Mortgage gave UCLC the
option to accelerate the Mortgage upon default of the Note.
Appellants' App. Vol. 2 at 64-65. On November
17, 1993, the Blairs sued UCLC and its agent, John Ash
("Ash"), alleging breach of contract and various
torts, including fraud and intentional infliction of
emotional distress ("the Ash lawsuit").
Appellants' App. Vol. 3 at 15-23, 95.
The monthly installment payment on the Note was $1, 469.36.
Tr. Vol. II at 48-49. After making regular payments
on the Note for approximately two-and-one-half years, the
Blairs defaulted, making their last payment on June 19, 1995.
Id. at 35-36. On August 27, 1997, the Blairs filed a
Chapter 13 bankruptcy case ("the Blair
Bankruptcy"), which automatically stayed the Ash
lawsuit. Appellants' App. Vol. 3 at 24. On
December 16, 1997, the bankruptcy court lifted the bankruptcy
stay as to UCLC, allowing it to proceed with its foreclosure
action in state court. Id. at 24-25. On October 31,
1998, the trial court in the Ash lawsuit granted UCLC leave
to file its counterclaim for foreclosure against the Blairs.
Id. at 96.
UCLC filed for Chapter 11 bankruptcy on March 1, 1999
("the UCLC bankruptcy"). Id. at 28; 96-97.
On July 20, 2000, the Note and Mortgage were assigned to EMC.
Appellants' App. Vol. 2 at 67. About six weeks
later, on September 23, 2000, the bankruptcy court entered an
order approving an asset purchase agreement involving many of
UCLC's assets, including the Note and Mortgage in this
case. Id. at 106-11. When EMC bought the Note and
Mortgage on September 23, 2000, the Ash lawsuit and the Blair
bankruptcy were still pending. Id. at 95-99. On
October 2, 2003, the Blairs obtained their bankruptcy
discharge. Appellants' App. Vol. 3 at 78.
Meanwhile, Ash failed to appear in the Ash lawsuit to contest
his liability, and on March 14, 2007, the Blairs obtained a
default judgment against him for $300, 000.00. Id.
at 97-98, 126. Although it had purchased the Note from UCLC
in 2000, EMC was never named as a defendant in the Ash
lawsuit. Id. at 95-99. On June 19, 2007, six years
after the Note and Mortgage were assigned to EMC, EMC
recorded the assignments. Appellants' App. Vol.
2 at 67.
On June 18, 2009, nearly six years after the Blairs received
their bankruptcy discharge, EMC sought to reopen the
Blairs' bankruptcy by filing a "Complaint for
Declaratory Judgment," asking the bankruptcy court to
clarify the extent, validity, and priority of EMC's lien,
as well as the impact of the Blairs' partial bankruptcy
discharge on EMC's ability to collect the indebtedness
due under the Note and Mortgage. Appellants' App.
Vol. 3 at 75.
On January 6, 2012, EMC and the Blairs filed a Joint
Stipulation and Joint Motion to dismiss EMC's Complaint
for Declaratory Judgment, stipulating the following:
a. The lien provided for by the terms of the Mortgage
survives and is unaffected by the Blair Bankruptcy;
b. The Note and Mortgage at issue herein were not discharged
in the [Blair] Bankruptcy;
. . .
e. There has been no determination in the Blair Bankruptcy if
EMC Mortgage is the true party in interest as it relates to
the enforcement of the Note and Mortgage[.]
Id. at 84-85.
JPMorgan Chase Bank, N.A. ("Chase") began servicing
the loan for EMC on April 1, 2011, and, three days later sent
the Blairs a default notice. Pl.'s Ex. 4 at 52.
The notice gave the Blairs an opportunity to cure their loan
defaults and informed them that the entire loan balance would
be accelerated, and foreclosure proceedings would begin if
the Blairs did not do so. Id. at 53.
On July 5, 2012, EMC filed its foreclosure lawsuit.
Appellants' App. Vol. 2 at 5, 50. EMC sought a
personal judgment against the Blairs for the outstanding
principal balance, interest, attorney fees, expenses, and
costs and a judgment declaring that EMC's Mortgage is a
valid and enforceable first priority lien against the
mortgaged properties. Id. at 52-53.
On September 27, 2012, the Blairs filed their answer to the
complaint and raised affirmative defenses and counterclaims.
The Blairs alleged that the assignment of the Note and
Mortgage from the original lender, UCLC, to EMC was void
because the assignment occurred almost two ...