Court affirms bank entitled to foreclose on mortgage

The Indiana Court of Appeals affirmed the foreclosure on a man’s mortgage after it found a mistake in making the deed for the property did not mean the man did not own it at the time of a modification agreement.

Timothy Williamson defaulted on his mortgage in June of 2008 and U.S. Bank National Association filed a mortgage foreclosure complaint against him. The Marion County Sheriff’s Department scheduled a sale of the property, but the day before the sale the bank said it was negotiating a plan to resolve the foreclosure. However, the sale mistakenly took place anyway and U.S. Bank was award the property. A deed was arranged for U.S. Bank as the new owner.

The bank realized this mistake and moved for the trial court to set aside the sale and vacate the deed, which was granted. A year later, the Williamsons and the bank entered into a modification agreement. Two years after that, the bank called Williamson and told him there was not enough money to pay the property taxes in his escrow account. Williamson said he wasn’t going to pay that or any more mortgage payments because he discovered his name had been removed from the deed to the property and wanted proof his name was back on the deed to the home. The bank submitted an affidavit to the assessor reaffirming the court vacated the bank’s title and the title should be restored to Williamson, but Williamson still didn’t pay.

Six months later, U.S. Bank filed a complaint requesting to foreclose and four months after that filed a motion for summary judgment. Williamson filed a response objecting to the motion, saying he would not have entered into the modification agreement if he had known his name had been taken off the deed and the bank breached the agreement first by taking his name off of it.

U.S. Bank filed a reply to Williamson’s response designating Williamson’s deposition transcript and a copy of his mortgage servicing file. Williamson filed a motion to strike this evidence the day of his trial, but that was denied. The trial court granted summary judgment for U.S. Bank and Williamson appealed.

Williamson argued the trial court should not have denied his motion to strike, but because he filed his motion on the day of the trial, no one had an opportunity to review it. Because the trial court did not want to postpone the trial any further, it denied this motion. The COA said the trial court has a right to balance the need for an efficient judicial system with the need for deciding disputes on the merits and did not abuse its discretion when denying the motion.

Williamson also argued his mortgage agreement was unenforceable because he or U.S. Bank mistakenly believed his name was on the deed at the time of the agreement. However, Williamson did have valid deed to the property at that time, the COA ruled. “There is not one single deed to a property whose name changes according to ownership as Williamson implies,” Judge Rudolph Pyle wrote for the panel. “Accordingly, there was nothing in the chain of title after Williamson’s properly recorded deed in the Property to divest him of ownership.”

Williamson also argued U.S. Bank breached the modification agreement first by removing his name from the deed. However, the sheriff’s sale occurred before the agreement was even in place, so “U.S. Bank could not have breached an agreement that did not exist at the time of the alleged breach,” Pyle wrote.

The case is Timothy A. Williamson, v. U.S. Bank National Association, 49A05-1506-MF-521.