Real Scumbags Series: Who is Real Estate Investor Ramesh Kapur DBA AIC Management?

MEMORANDUM OPINION

The trial court granted summary judgment in favor of Appellee Wilcrest Park Townhomes Owners’ Association, Inc. on its claims for breach of contract, sworn account, judicial foreclosure, violations of the Texas Uniform Fraudulent Transfer Act and Texas’ Fraudulent Lien or Claim Statute, declaratory relief, and attorney’s fees.

The trial court signed a final judgment awarding Wilcrest $20,444.27 in damages and the right to foreclose on Appellant Ramesh Kapur’s townhome.1

Kapur argues we should reverse the final judgment on the grounds

(1) he was deprived of due process because he was not notified of the summary judgment hearing,

(2) he should be afforded an opportunity, on remand, to present his “meritorious defense” to Wilcrest’s claims,

(3) the trial court erred in denying his motion for new trial,

and

(4) he is entitled to sanctions against Wilcrest’s counsel.

Because the trial court did not abuse its discretion in granting Wilcrest’s summary judgment motion, we lack jurisdiction to review the denial of Kapur’s motion for new trial, and Kapur waived his sanctions argument, we affirm the trial court’s judgment.

Background

Wilcrest is a non-profit corporation that administers the Wilcrest Park Townhomes.

Kapur, doing business as AIC Management, purchased one of the townhomes (“the Townhome”) in 2014.

In May 2018, Wilcrest noticed the non– judicial foreclosure sale of the Townhome due to Kapur’s alleged failure to pay the required maintenance assessments and other charges required by the Townhome’s governing documents.

1           The trial court awarded other relief in its order not relevant to our analysis.

Wilcrest alleges Kapur engaged in a series of fraudulent  transfers of the property in May 2018 to avoid payment of the amounts due to Wilcrest and to avoid the non-judicial foreclosure.

In January 2019, Wilcrest sued Kapur and other individuals involved in the alleged fraudulent transfers. Wilcrest alleged that Kapur breached his contract with Wilcrest by failing to pay required maintenance assessments and other charges and that Kapur was liable for a suit on a sworn account for the same assessments and charges.

Wilcrest sought judicial foreclosure of the Townhome.

Wilcrest also asserted Kapur violated the Texas Uniform Fraudulent Transfer Act2 and Texas’ Fraudulent Lien or Claim Statute3 and sought attorney’s fees.4

Kapur filed a general denial in response to the petition.

2           See TEX. BUS. & COM. CODE § 24.001, et. seq.

3   Chapter 12 of the Civil Practice and Remedies Code contains the Fraudulent Lien or Claim Statute. The Fraudulent Lien or Claim Statute provides in part:

(a)   A person may not make, present, or use a document or other record with:

(1)  knowledge that the document or other record is a fraudulent court record or a fraudulent lien or claim against real or personal property or an interest in real or personal property;

(2)  intent that the document or other record be given the same legal effect as a court record or document of a court created by or established under the constitution or laws of this state or the United States or another entity listed in Section 37.01, Penal Code, evidencing a valid lien or claim against real or personal property or an interest in real or personal property; and

(3)   intent to cause another person to suffer:

(A)   physical injury;

(B)   financial injury; or

On August 6, 2021, Wilcrest filed a traditional motion for summary judgment and a notice of hearing setting the motion for hearing on October 5, 2021.

According to the certificate of service, Kapur was served with both documents by certified mail, return receipt requested, regular mail, and electronic service.

Kapur did not file a response to the summary judgment motion.

Kapur and Wilcrest attended a Zoom summary judgment hearing on October 5, 2021.5

The trial court denied the summary judgment motion, stating it was “untimely at this point.”

The trial court ordered the parties to mediation.

The parties did not mediate and on December 13, 2021, Wilcrest filed a motion requesting the trial court to reconsider its motion for summary judgment.

According to the certificate of service, Kapur was served with the motion by certified mail, return receipt requested, regular mail, and electronic service.

On December 15, 2021, Wilcrest filed a notice setting a Zoom hearing for its summary judgment motion on March 1, 2022, again serving Kapur by certified mail, return receipt requested, regular mail, and electronic service.

Kapur did not

(C)   mental anguish or emotional distress. TEX. CIV. PRAC. & REM. CODE § 12.002.

4   Wilcrest amended its petition to include a claim for declaratory relief with respect to the validity of several deeds involving the Property and with respect to the existence of IDM Services, Inc., to which Kapur allegedly sold the property at one point.

Wilcrest contends IDM did not exist as a corporation when it purportedly purchased the property.

5    Kapur asserts he learned of the October 5, 2021 hearing from his former attorney.

respond to the summary judgment motion6 or attend the hearing.

The trial court orally granted the motion at the March 1, 2022 hearing and it later issued a final judgment on March 7, 2022.

Among other things, the trial court granted Wilcrest $20,444.27 in damages and the right to foreclose on the Townhome.

On April 6, 2022, Kapur filed a sworn motion to vacate summary judgment and motion for new trial, arguing service of the summary judgment motion was defective and that the address of the Townhome provided on the final judgment was incorrect.

On April 19, 2022, Wilcrest filed a motion for judgment nunc pro tunc seeking to amend the final judgment to reflect the Townhome’s correct address, which was properly identified in Wilcrest’s summary judgment motion.

The trial court signed a corrected final judgment7 on May 25, 2022, reflecting the Townhome’s correct address.

6   Kapur filed a response to Wilcrest’s motion for summary judgment on May 20, 2022.

In the response, he alleged, among other things, that

(1) the (original) final judgment contained “a fundamental error” because it provided the wrong address of the Townhome,

(2) some of Wilcrest’s summary judgment evidence was inadmissible,

and

(3) Kapur raised genuine issues of material fact as to each claim.

Kapur also alleged affirmative defenses not previously pled.

7   As discussed below, the trial court had plenary power when it signed the corrected final judgment.

As such, the corrected final judgment was not a judgment nunc pro tunc but rather a modified judgment.

See Alford v. Whaley, 794 S.W.2d 920, 922 (Tex. App.–Houston [1st Dist.] 1990, no writ)

(noting if court signs corrected judgment during plenary jurisdiction, it is modified judgment, even if labeled judgment nunc pro tunc).

“A trial court has plenary power to reverse, modify, or vacate its judgment at any time before it becomes final.”

Mathes v. Kelton, 569 S.W.2d 876, 878 (Tex. 1978).

Kapur’s motion for new trial was overruled by operation of law on May 23, 2022,8 and the trial court signed an order denying the motion for new trial two days later.

This appeal ensued.

Motion to Dismiss

Wilcrest filed a motion to dismiss Kapur’s appeal for lack of jurisdiction, arguing his notice of appeal was untimely.

The Supreme Court has held that “if the court makes any change in a judgment, no matter how minuscule—adding a comma, for example—the time periods for the court’s plenary power and for appeal recommence.”

Lane Bank Equip. Co. v. Smith S. Equip., Inc., 10 S.W.3d 308, 315 (Tex. 2000).

The trial court signed the first final judgment on March 7, 2022.

Kapur filed his motion for new trial on April 6, 2022, and it was overruled by operation of law on May 23, 2022.

See TEX. R. CIV. P. 329b(c)

(stating motion for new trial is overruled by operation of law seventy-five days after judgment is issued).

The court’s plenary jurisdiction was thus set to have expired thirty days later, or on June 22, 2022.

TEX. R. CIV. P. 329b(e)

(stating that when motion for new trial is

8  A motion for new trial is overruled by operation of law seventy-five days after a judgment is signed.

TEX. R. CIV. P. 329b(c).

Because the seventy-fifth day in this case fell on Saturday, May 21, 2022, Kapur’s motion for new trial was overruled by operation of law on Monday, May 23, 2022.

See TEX. R. CIV. P. 4; see also N. Burnet Gun Store, LLC v. Tack, Tr. of Harvey Donald Testamentary Family Tr., 604 S.W.3d 587, 589 (Tex. App.—Austin 2020, no pet.)

(applying Texas Rule of Civil Procedure 4 to deadline in Texas Rule of Civil Procedure Rule 329b(c)).

filed, court’s plenary power is extended to thirty days after motion is overruled, either by written order or by operation of law, whichever occurs first).

The corrected final judgment was signed on May 25, 2022, during the court’s plenary jurisdiction, causing the appellate deadlines to restart.

See Lane Bank Equip. Co., 10 S.W.3d at 315.

Kapur’s notice of appeal, filed on June 23, 2022, or twenty-nine days after the corrected final order was signed, was thus timely.

TEX. R. APP. P. 26.1 (notice of appeal must be filed within thirty days after judgment is signed).

We deny Wilcrest’s motion to dismiss the appeal.9

The Summary Judgment Motion

A.               Standard of Review

We review a trial court’s ruling on a motion for summary judgment de novo.

Valence Operating Co. v. Dorsett, 164 S.W.3d 656, 661 (Tex. 2005).

When reviewing a ruling on a traditional summary judgment motion, we take as true all evidence favorable to the nonmovant, and we indulge in every reasonable inference and resolve any doubts in the nonmovant’s favor.

Id. at 661 (citing Provident Life & Accident Ins. Co. v. Knott, 128 S.W.3d 211, 215 (Tex. 2003)).

To prevail on a traditional summary judgment motion, the movant must establish

9           We dismiss as moot Kapur’s motions to supplement the clerk’s record and to extend time to file his response to the jurisdictional issue.

that no genuine issues of material fact exist and that it is entitled to judgment as a matter of law.

TEX. R. CIV. P. 166a(c).

B.                Due Process

In his first issue, Kapur argues he was deprived of his due process rights because he was not notified of the March 1, 2022 summary judgment hearing.10

He contends Wilcrest “never served a copy of [the] MSJ to any defendant” and that had he been given an opportunity to be heard, he would have presented evidence to raise a genuine issue of material fact and defeat the summary judgment.

Wilcrest filed its summary judgment motion and notice of hearing on August 6, 2021.

According to the certificate of service, Wilcrest served the motion and notice that day on Kapur by certified mail, return receipt requested and regular mail at 9022 Beverlyhill St., Houston, TX 77063, and by electronic service.

Kapur did not file a response to the summary judgment motion11 but appeared at the summary judgment hearing on October 5, 2021.

The trial court held “that the

10  Kapur also argues that another defendant was not served with the summary judgment.

Because that defendant is not a party to this appeal, we do not address that argument.

Kapur also argued “all three defendants denied receiving the MSJ copy” but does not cite to the record for this proposition.

The reporter’s record from the October 5, 2021 hearing, which Kapur attended, does not support this statement.

11  Kapur told the trial court during the October 5, 2021 hearing he did not receive the “summary judgment motion paperwork.”

motion for summary judgment [wa]s untimely at this point” and referred the parties to mediation.12

On December 13, 2021, Wilcrest filed a motion with the trial court

(1) stating the parties had not been able to mediate with the court-appointed mediator

and

(2) asking the court to reconsider its summary judgment motion.

The certificate of service indicates the motion was served on Kapur by certified mail, return receipt requested and regular mail at 9022 Beverlyhill St., Houston, TX 77063, and by electronic service.

On December 15, 2021, Wilcrest filed a notice of hearing for its summary judgment motion, setting the motion for hearing on March 1, 2022. According to the certificate of service, the notice was served on Kapur by certified mail, return receipt requested and regular mail at 9022 Beverlyhill St., Houston, TX 77063, and by electronic service.

Kapur did not file a response to the summary judgment motion prior to the March 1, 2022 hearing.13

Nor did Kapur appear at the hearing.

The trial court orally granted the summary judgment motion during the hearing and signed a final judgment on March 7, 2022.

The trial court later signed a corrected final judgment on May 25, 2022.

12         Contrary to Kapur’s assertion in his appellate brief, the court did not decline to rule because the defendants did not receive the summary judgment motion.

13         Kapur filed a response to the summary judgment motion on May 20, 2022.

Kapur argues that “it is apparent on the face of the record that [he] did not receive either the motion for summary judgment or a notice of the hearing on the motion.”

He claims Wilcrest “did not serve a copy of [the] MSJ . . . even though it alleges that [the] MSJ was served on Kapur [b]y mailing it by Certified Mail RRR but provided no tracking number, no receipt of mailing, no Green Card as being proof of its receipt, or offered Envelope returned with Green card with stamp ‘UNCLAIMED’[.]”

Finally, Kapur argues the trial court was “expected to verify the notice requirements of the rule.”14

Texas Rule of Civil Procedure 21a(e) provides that “[a] certificate by a party or an attorney of record, or the return of the officer, or the affidavit of any other person showing service of a notice shall be prima facie evidence of the fact of service.”

TEX. R. CIV. P. 21a(e).

After the presumption of service is created, the burden shifts to the non-movant to rebut the presumption of service.

Landagan v. Fife, No. 01-13-00536-CV, 2014 WL 2809813, at *4 (Tex. App.—Houston [1st Dist.] June 19, 2014, no pet.) (mem. op.).

“In the absence of any proof to the contrary, the presumption has the force of a rule of law.”

Thomas v. Ray, 889 S.W.2d 237, 238 (Tex. 1994) (orig. proceeding).

The presumption “vanishes when

14  Kapur cites International Insurance Company v. Herman G. West, Inc., 649 S.W.2d 824, 825 (Tex. App.—Fort Worth 1983, no writ) in support of his argument the trial court was expected to verify the satisfaction of the service requirements.

The case does not support that proposition.

Regardless, the court asked Wilcrest if the notice of hearing was sent by certified mail, return receipt requested on Kapur, and Wilcrest confirmed it had been.

opposing evidence is introduced” that the document was not received.

Cliff v. Huggins, 724 S.W.2d 778, 780 (Tex. 1987).

The notice of hearing filed on December 15, 2021 included a certificate of service showing Kapur was served by certified mail, return receipt requested and regular mail at 9022 Beverlyhill St., Houston, TX 77063, and by electronic service.

Kapur does not argue that the physical address reflected in the certificate of service is incorrect.15

Indeed, Kapur was served at the physical address which he affirmed under oath was his correct address.16

Kapur’s former attorney provided the same physical address for Kapur in his June 4, 2021 motion to withdraw.

And Kapur used the same physical address in a pleading17 Kapur filed on January 14, 2021, and in his pro se notice of appeal.18

Kapur appears to argue in the sworn statement attached to his motion for new trial that health issues precluded him from collecting mail from approximately

15  Kapur did, however, state in his motion for new trial that the email address identified on the certificates of service was incorrect and, therefore, he was not served with notice of the summary judgment proceedings.

He also argues on appeal that he was not served because the email address used by Wilcrest for service of documents pertaining to the summary judgment proceedings was not correct.

16   The sworn statement was attached to Kapur’s motion for new trial.

17  The record only contains the last page of the pleading, which is an exhibit to Kapur’s motion for new trial.

18  The notice of appeal bears a different zip code but the same physical address.

The other pleadings that identify the physical address use the 77063 zip code.

January through March 2022 at the address identified on the certificate of service.19

But failure to collect mail, regardless of the reason, does not rebut the presumption of service.

See Nichols v. Goodger, No. 03-16-00044-CV, 2017 WL 3122793, at *2 (Tex. App.—Austin July 20, 2017, no pet.) (mem. op.)

(“That Nichols either ignored the mail or refused it outright, as he acknowledged, does not change the fact that he was, in fact, given rule-compliant notice of the trial setting. Nichols’s refusal to receive or read the notices—which he uses as the basis of his argument that he did not receive actual notice of the trial setting—constitutes constructive notice of the trial setting.”) (emphasis in original) (citations omitted);

cf. Guerra v. Guerra, No. 04-20-00366-CV, 2022 WL 689097, at *4 (Tex. App.—San Antonio Mar. 9, 2022, pet. denied) (mem. op.)

(“Parents’ failure to collect mail while absent from the country or to provide a different address to be served at while out of the country did not entitle them to a bill of review.”).

Given Kapur’s failure to produce evidence to rebut the presumption Wilcrest served him with the summary judgment motion and notice of hearings at his physical address, we conclude Kapur was not deprived of due process.

We overrule Kapur’s first issue.

19   The verification states in part:

“Because of these health issues, [Kapur] have had rare opportunity to attend to his official duties except to collect mail at 9022 Beverlyhill location for the past about 3 months[.]

[Kapur] stated he had no one else working at the location due to pandemic situation to accept mail. [Kapur] further stated he is unaware if any mail was returned.” (Emphasis added.)

C.               Meritorious Defenses

Kapur argues he has a “meritorious defense to the underlying action and remand is appropriate.”

The record includes Kapur’s original answer, which asserted a general denial and no affirmative defenses.

Kapur argues he will be prejudiced if the case is not remanded so he can assert his arguments “regarding damages” and the statute of limitations.

Limitations is an affirmative defense subject to waiver if not affirmatively pleaded.

Cooke v. Morrison, 404 S.W.3d 100, 112 (Tex. App.—Houston [1st Dist.] 2013, no pet.) (citing TEX. R. CIV. P. 94).

Texas Rule of Civil Procedure 94 specifically identifies limitations as an affirmative defense that must be pleaded in a responsive pleading.

TEX. R. CIV. P. 94.

Because Kapur did not affirmatively plead the statute of limitations in his answer, he waived limitations.

Moreover, because Kapur filed a general denial and no affirmative defenses, he also waived all other affirmative defenses.

Fawcett v. Grosu, 498 S.W.3d 650, 663 (Tex. App.—Houston [14th Dist.] 2016, pet. denied)

(“All affirmative defenses are waived when the defendant files only a general denial.”)

(citing Hassell Constr. Co. v. Stature Comm. Co., 162 S.W.3d 664, 667 (Tex. App.—Houston [14th Dist.] 2005, no pet.)).

Kapur has not provided any authority stating he is entitled to a remand to avoid “suffer[ing] prejudice” regarding damages awarded by the trial court in its final judgment, and we are not aware of any applicable authority in these circumstances.

The case on which he relies, Epps v. Fowler, 351 S.W.3d 862 (Tex. 2011), is inapposite and not a summary judgment case.

In Epps, the Supreme Court considered whether a defendant is a prevailing party entitled to attorney’s fees when the plaintiff nonsuits a case without prejudice.

Id. at 864.

The Court held the defendant is only a prevailing party if the court determines on the defendant’s motion “that the plaintiff took the nonsuit in order to avoid an unfavorable judgment.”

Id.

The Court remanded the attorney’s fee claim to the trial court to determine whether the appellees dismissed their claim to avoid an unfavorable judgment.

Id. at 872.

Nothing in the holding of Epps suggests we may remand the case to allow Kapur to assert affirmative defenses he failed to raise below in the first instance.

We overrule Kapur’s second issue.

Motion for New Trial

A.               Standard of Review

We review a trial court’s denial of a motion for new trial for an abuse of discretion.

In re R.R., 209 S.W.3d 112, 114 (Tex. 2006) (citing Director, State Emps. Workers’ Comp. Div. v. Evans, 889 S.W.2d 266, 268 (Tex. 1994)).

A trial court abuses its discretion when it acts in an “arbitrary or unreasonable” manner or when it acts “without reference to any guiding rules and principles.”

Downer v. Aquamarine Operators, Inc., 701 S.W.2d 238, 241–42 (Tex. 1985).

B.                Analysis

The trial court signed its original final judgment on March 7, 2022.

Kapur’s motion for new trial was thus due on April 6, 2022.

TEX. R. CIV. P. 329b(a) (motion for new trial is due within thirty days after judgment is signed).

Kapur’s motion for new trial, while file-stamped April 6, 2022, bears a certificate of service indicating it was served on April 12, 2022.

Wilcrest filed a response to the motion for new trial, arguing it was untimely based on the date on the certificate of service.20

Kapur argues the trial court erred in denying his motion for new trial because he timely filed it, as reflected by the court’s file stamp.

We need not address the timeliness of Kapur’s motion for new trial because we lack jurisdiction to review its denial.

Kapur’s notice of appeal does not contemplate an appeal of the denial of his motion for new trial.

In his notice of appeal, Kapur states he is appealing the judgment signed on May 25, 2022, which he attached to his notice.

He does not indicate he is appealing the trial court’s denial of his motion for new trial.

We thus lack jurisdiction to review the denial of his motion.

See Ortiz v. St. Teresa Nursing & Rehab. Ctr., LLC, 579 S.W.3d 696, 702  (Tex.  App.—El  Paso  2019,  pet.  denied)

(“[W]e  are  precluded  from

20         We note that Wilcrest conceded in its motion to dismiss the appeal for lack of jurisdiction that Kapur’s motion for new trial was filed timely.

considering an appeal from an order never identified in the notice of appeal.”)

(quoting TEX. R. APP. P. 25.1(b)

(“The filing of a notice of appeal by any party invokes the appellate court’s jurisdiction over all parties to the trial court’s judgment or order appealed from.”) (emphasis in original)).

Even if we had jurisdiction to review the denial of Kapur’s motion for new trial, we would not find the court abused its discretion.

Kapur argues in his appellate brief only that his motion for new trial was timely filed, apparently believing that his motion for new trial was denied because the trial court thought it untimely.

The trial court did not explain why it denied Kapur’s motion, nor was it obligated to provide a reason for the denial.

See Banco Popular N. Am. v. Am. Fund US Invs. LP, No. 05-14-00368-CV, 2015 WL 1756107, at *1 (Tex. App.— Dallas Apr. 17, 2015, pet. denied) (mem. op.)

(“Because the trial court’s order denied Banco Popular’s motion for new trial, it was not required to give any reason for doing so.”);

Nicholson v. XTO Energy, Inc., No. 02-16-00045-CV, 2016 WL 6648755, at *1 n.2 (Tex. App.—Fort Worth Nov. 10, 2016, no pet.) (mem. op.) (same).

Moreover, even though his motion for new trial was based on several grounds, Kapur does not argue the merits of his motion for new trial in his appellate brief.

In the absence of any argument on the merits of Kapur’s motion for new trial, we decline to find the trial court abused its discretion in denying it.

See TEX. R. APP. P. 38.1(i)

(“The brief must contain a clear and concise argument for the contentions made, with appropriate citations to authorities and to the record.”);

see also Fredonia State Bank v. Gen. Am. Life Ins. Co., 881 S.W.2d 279, 284 (Tex. 1994)

(noting “long-standing rule that a point may be waived due to inadequate briefing”).

We overrule Kapur’s third issue.

Sanctions

In his fourth issue, Kapur argues Wilcrest’s counsel should be sanctioned for engaging in perjury during the March 1, 2022 summary judgment hearing.

Kapur contends Wilcrest’s counsel “was successful in lying before the court that he had notified all parties” of the summary judgment hearing.

Kapur’s argument lacks a single citation to the record or to any authority.

He thus waived his argument.

See TEX. R. APP. P. 38.1(i); see also Encinas v. Jackson, 553 S.W.3d 723, 728 (Tex. App.—El Paso 2018, no pet.)

(holding appellant waived issue on appeal by failing to provide citation to authority or apply applicable law to facts of case);

Liberty Mut. Ins. Co. v. Griesing, 150 S.W.3d 640, 648 (Tex. App.—Austin 2004, pet. dism’d w.o.j.)

(“Bare assertions of error, without citations to authority, waive error.”).

Even if Kapur had not waived the issue, we lack jurisdiction to consider it.

Appellate courts are authorized to impose sanctions in limited circumstances.

For example, as Wilcrest notes, appellate courts are authorized to sanction a litigant with respect to the filing of a frivolous appeal.

Texas Rule of Appellate Procedure 45 states:

If the court of appeals determines that an appeal is frivolous, it may— on motion of any party or on its own initiative, after notice and a reasonable opportunity for response—award each prevailing party just damages. In determining whether to award damages, the court must not consider any matter that does not appear in the record, briefs, or other papers filed in the court of appeals.

TEX. R. APP. P. 45.21

Appellate courts also may impose sanctions in connection with attorney misconduct that occurs in the court of appeals.

“[W]hen an attorney engages in misconduct before our court . . . we retain the inherent power to discipline such behavior when reasonably necessary and to the extent deemed appropriate.”

Johnson v. Johnson, 948 S.W.2d 835, 840 (Tex. App.—San Antonio 1997, writ denied) (emphasis added);

In re Terminix Int’l, Co., L.P., 131 S.W.3d 651, 653–54 (Tex. App.—Corpus Christi 2004, no pet.)

(imposing sanctions pursuant to

21  A similar rule pertains to cases before the Supreme Court. Texas Rule of Appellate Procedure 62 states:

If the Supreme Court determines that a direct appeal or a petition for review is frivolous, it may—on motion of any party or on its own initiative, after notice and a reasonable opportunity for response—award to each prevailing party just damages. In determining whether to award damages, the Court must not consider any matter that does not appear in the record, briefs, or other papers filed in the court of appeals or the Supreme Court.

TEX. R. APP. P. 62.

appellate court’s inherent power because of attorney’s acts during course of original proceeding, which violated Texas Rules of Professional Conduct);

cf. New Penn Fin. LLC v. Salvagio, Nos. 09-19-00157-CV, 2021 WL 1306390, at *6 (Tex. App.—Beaumont Apr. 8, 2021, no pet.) (mem. op.)

(assessing “punitive fine” against attorney who willfully violated appellate court’s writ of injunction).

Even assuming Kapur’s perjury allegations had merit, we could not grant the relief sought because we lack jurisdiction to impose sanctions in circumstances involving allegations of wrongdoing in the trial court.

Appellate courts do not make fact findings, thus we cannot make a determination that perjury occurred in the trial court.

“Findings of fact are the exclusive province of the jury and/or trial court.”

Bellefonte Underwriters Ins. Co. v. Brown, 704 S.W.2d 742, 745 (Tex. 1986);

see also Tex. Nat’l Bank v. Karnes, 717 S.W.2d 901, 903 (Tex. 1986)

(“[A] court of appeals cannot make original findings of fact[.]”).

We overrule Kapur’s fourth issue.

Conclusion

We affirm the trial court’s judgment.

Veronica Rivas-Molloy Justice

Panel consists of Justices Kelly, Countiss, and Rivas-Molloy.

TRACY CHRISTOPHER CHIEF JUSTICE.

This is an appeal from an independent suit brought to challenge the expedited foreclosure of a home-equity loan pursuant to Texas Rule of Civil Procedure 736.

Pursuant to this rule, the beneficiary of the security instrument obtained a court order authorizing it and its “successors and assigns” to foreclose, then assigned the security instrument to another, who foreclosed.

Ramesh Kapur, the title-owner of record at the time of foreclosure, sued the assignee, the loan servicer, and the property’s purchaser to quiet title and for declaratory relief.

The trial court granted summary judgment in favor of the assignee and the loan servicer, denied Kapur’s cross-motion for summary judgment, and dismissed his claims with prejudice.

We affirm the trial court’s judgment.

I. Expedited Foreclosure of Home-Equity Loans

To understand the issues in this appeal, it is helpful to begin with an overview of the law concerning expedited foreclosure of home-equity loans.

Under the Texas Constitution, a homestead is protected from forced sale except for certain debts, which include “an extension of credit that . . . is secured by a lien that may be foreclosed upon only by a court order.”

Tex. Const. art. XVI, § 50(a)(6)(D).

The same section of the Texas Constitution required the Supreme Court of Texas to “promulgate rules of civil procedure for expedited foreclosure proceedings related to the foreclosure” of such liens.

Id. § 50(r).

Texas Rule of Civil Procedure 736 governs expedited foreclosure proceedings of home-equity loans.

See Tex. R. Civ. P. 735.1(a).

A petitioner, which can be “any person legally authorized to prosecute the foreclosure,” institutes the proceeding by filing an application for an expedited order of foreclosure.

Tex.R.Civ.P. 736.1(d)(1)(A).

The “respondents” include each mortgagor and each person whom the records of the noteholder or loan servicer show to be obligated to pay the loan.

Tex.R.Civ.P. 736.1(d)(1)(B).

A respondent may file a response, but there are no counterclaims, cross-claims, or interventions.

Tex.R.Civ.P. 736.5(d).

No cause of action may be  filed in the expedited-foreclosure proceeding by any person.

Id. *3

If no response is timely filed, the petitioner may move for a default order, and all facts alleged in the application and the petitioner’s affidavit of material facts will constitute prima facie evidence of the truth of the matters alleged.

Tex.R.Civ.P. 736.7(a).

If the petitioner establishes the basis for the foreclosure, the court must issue an order granting the application.

Tex.R.Civ.P. 736.8(a).

“After an order is obtained, a person may proceed with the foreclosure process under applicable law and the terms of the lien sought to be foreclosed.”

Tex.R.Civ.P. 736.9.

A Rule 736 order is not a judgment, and the grant or denial of the application is not subject to a motion for rehearing, a motion for new trial, a bill of review, or an appeal.

Tex.R.Civ.P. 736.8(c).

It is without prejudice and has no res judicata or other such effect in any other judicial proceeding.

Tex.R.Civ.P. 736.9.

It can be challenged only through an independent original proceeding filed in a court of competent jurisdiction.

Tex.R.Civ.P. 736.8(c).

This is an appeal from such an independent original proceeding challenging a Rule 736 order for expedited foreclosure.

II. Nomenclature

The facts in this case are undisputed, but the arguments we must discuss turn on the distinction between U.S. Bank National Association (USBNA) in two different capacities with similarly unwieldy names.

In the first capacity, USBNA is the indenture trustee for the holders of the CIM Trust 2017-3, Mortgage-Backed Notes, Series 2017-3.

We will refer to USBNA in this capacity as “the 2017 Trustee.”

In the second capacity, USBNA is the indenture trustee for the holders of the CIM Trust 2021-NR2, Mortgage-Backed Notes, Series 2021-NR2.

We will refer to USBNA in this capacity as “the 2021 Trustee.”

III. Background

Carol Gafford took out a home-equity loan secured by a lien on her condominium (the Property).

After becoming the beneficiary of the security instrument securing the home-equity loan, the 2017 Trustee successfully sued Kapur for a declaration that it held a valid lien on the Property.

The home-equity loan was in default, so the 2017 Trustee next applied to the 125th District Court for an expedited order of foreclosure pursuant to Texas Rule of Civil Procedure 736, naming Gafford as the respondent.

To differentiate it from the trial court in this action, we refer to the 125th District Court as the “Foreclosure Court.”

The 2017 Trustee successfully moved for default judgment, and the Foreclosure Court signed an order (the Rule 736 Order) authorizing the 2017 Trustee, “its successors[,] and assigns” to proceed with foreclosure.

Four days after the Foreclosure Court signed the order, the 2017 Trustee assigned its interest in the Property’s security instrument “and the full benefit of all the powers and of all the covenants and provisos therein contained” to the 2021 Trustee.

The 2021 Trustee proceeded with the foreclosure sale, at which HREAL Company, LLC, bought the Property.

Some months later, Kapur sued the 2021 Trustee, the loan servicer Select Portfolio Servicing, Inc. (Select), and HREAL.

Kapur challenged the Rule 736 Order, asking the trial court to quiet title and to declare the foreclosure sale to HREAL void.

The 2021 Trustee and Select moved jointly for no-evidence and traditional summary judgment on Kapur’s claims.

HREAL adopted its co-defendants’ motion, and Kapur filed a cross-motion for traditional summary judgment.

The trial court granted the defendants’ motion, denied Kapur’s motion, and dismissed all of Kapur’s claims with prejudice.

The trial court denied Kapur’s motion for new trial, and Kapur brought this appeal.

IV. Issues Presented

Kapur presents nine issues for review.

First, he contends that a no-evidence motion for summary judgment is improper where, as here, the facts are undisputed and the case turns on purely legal issues.

If such a motion is proper, Kapur contends he produced sufficient evidence to defeat summary judgment on his quiet-title claim.

In his second through seventh issues, Kapur presents variations on his argument that the 2021 Trustee had to file its own application for a Rule 736 order and could not rely on the order issued to the 2017 Trustee.

In his eighth issue, Kapur challenges the denial of his claim for declaratory relief, and in his ninth, Kapur asks that, if we reverse and render judgment in his favor, we remand his claim for attorney’s fees.

Because the issues presented arise from cross-motions for summary judgment raising questions of law based on undisputed facts, we determine all issues under a de novo standard of review and render the judgment the trial court should have rendered.

Finley Res., Inc. v. Headington Royalty, Inc., 672 S.W.3d 332, 338 (Tex. 2023).

V. Validity of the Foreclosure Sale

To prevail in a suit to quiet title or to remove a cloud from title, the plaintiff must prove that

(1) the plaintiff has an interest in a specific property;

(2) a claim by the defendant affects title to the property;

and

(3) the defendant’s claim, though facially valid, is invalid or unenforceable.

Montenegro v. Ocwen Loan Servicing, LLC, 419 S.W.3d 561, 572 (Tex. App.-Amarillo 2013, pet. denied).

The defendants moved for

(a) no- evidence summary judgment on the ground that there is no evidence of the third element, that is, there is no evidence invalidating the sale;

and

(b) traditional summary judgment on the ground that the recitals in the deed to HREAL are prima facie evidence that the sale was valid.

See Houston First Am. Sav. v. Musick, 650 S.W.2d 764, 767 (Tex. 1983).

When a successful movant sought both no-evidence and traditional summary judgment, and the record does not reveal the grounds on which the trial court may have granted judgment, we ordinarily review the no-evidence grounds first.

See Ford Motor Co. v. Ridgway, 135 S.W.3d 598, 600 (Tex. 2004).

But, because Kapur disputes in his first issue whether a no-evidence motion for summary judgment is the proper vehicle to resolve a question of law based on undisputed facts, it is more efficient to set aside that question and analyze the traditional summary-judgment grounds.

All of Kapur’s remaining issues ultimately rest on his contention that the foreclosure sale is void because the only person who can foreclose under a Rule 736 order is the petitioner named in the application and in the order.[1]

In support of his position, Kapur cites the Texas Constitution, Rule 736, and a single case from the Second Court of Appeals.

But none of these sources support that result.

We instead conclude that after the 2017 Trustee obtained the Rule 736 Order authorizing it to exercise the power of sale under the security instrument, the assignment of the security instrument carried with it the authority to foreclose.

[1] The 2017 Trustee was the petitioner and was named in the application as required.

See Tex. R. Civ. P. 736.1(d)(1)(A).

In reaching this conclusion, we do not rely on the “successors and assigns” language of the Rule 736 Order, but on the nature of an assignment.

“An assignee stands in the shoes of his assignor.”

Jackson v. Thweatt, 883 S.W.2d 171, 174 (Tex. 1994) (quoting FDIC v. Bledsoe, 989 F.2d 805, 810 (5th Cir. 1993) (cleaned up).

The assignee can assert those rights that the assignor could assert.

See Gulf Ins. Co. v. Burns Motors, Inc., 22 S.W.3d 417, 420 (Tex. 2000).

Here, the security instrument gave the 2017 Trustee the power to sell the property, and the Rule 736 Order authorized the 2017 Trustee to exercise that power.

Because an assignee “receives the full rights of the assignor,”2 the 2021 Trustee received from the 2017 Trustee both the power and the authority to proceed with foreclosure.

2 Jackson, 883 S.W.2d at 174.

Kapur maintains that we must look to the assignment itself to determine its scope.

The 2017 Trustee assigned its interest in the security instrument “and the full benefit of all the powers and of all the covenants and provisos therein contained” to the 2021 Trustee.

The security instrument states that its covenants and agreements “shall bind and benefit the successors and assigns of Lender and Borrower.”

This includes the covenant, which Kapur quotes in part, that the Lender “or Trustee, upon written request of Lender may, institute proceedings to foreclose the lien of this [security instrument] . . . by court order in accordance with the rules of civil procedure for expedited foreclosure proceedings………………………………………………………. ”

From this excerpt, Kapur reasons that the security instrument conveys to an assignee only the assignor’s right to “institute proceedings” under Rule 736.

We agree that the security instrument conveys that right, but it conveys other rights as well.

The quoted sentence goes on to say that, “to the extent such rules or a court order permit, Lender may invoke the power of sale ”

This provision, too, “binds and benefits” the Lender’s assigns.

It follows that if, at the time of the assignment, an existing court order permitted the assignor to invoke the power of sale, then the assignment permits the assignee to invoke that power.[3]

Stated differently, the assignment conveys to the assignee the assignor’s right to invoke the power of sale.

The assignment conveyed that right to the 2021 Trustee regardless of whether the Rule 736 Order specifically authorized the 2017 Trustee’s “successors and assigns” to foreclose.

[3] Because this case concerns only an assignment after a Rule 736 Order was signed, we express no opinion about the effect of an assignment at an earlier time.

A.  Kapur’s Argument from the Texas Constitution

Kapur cites two provisions of the Texas Constitution as support for his position, but neither purports to change the law concerning assignments.

The first provision merely states that “[t]he homestead of a family, or of a single adult person, shall be, and is hereby protected from forced sale, for the payment of all debts except for . .. an extension of credit that…… is secured by a lien that may be foreclosed upon only by a court order.”

Tex. Const. art. XVI, § 50(a)(6)(D).

The second provision says only, “The supreme court shall promulgate rules of civil procedure for expedited foreclosure proceedings related to the foreclosure of liens under Subsection (a)(6) of this section……………. ”

Id. art. XVI, § 50(r).

Neither of these provisions discuss the parties to an expedited-foreclosure proceeding or identify the persons who can exercise rights under an order for expedited foreclosure.

B.  Kapur’s Arguments from Rule 736

The restrictions Kapur describes are also absent from Rule 736, which distinguishes between a “petitioner” and a “person.”

A “person,” may be a petitioner, a respondent, or neither.

To illustrate, “[a]ny person legally authorized to prosecute the foreclosure” may be a petitioner, and the petitioner must be named in the application.

See Tex. R. Civ. P. 736.1(d)(1)(A).

In a proceeding to expedite foreclosure of a home-equity loan, Rule 736 states that a “respondent” is “each person” whom the noteholder’s or loan servicer’s records identify as obligated to pay the agreement, contract, or lien to be foreclosed, and each mortgagor.

Tex.R.Civ.P. 736.1(d)(1)(B).

But it is also possible for a “person,” as that word is used in Rule 736, to be neither a petitioner nor a respondent.

For example, Rule 736 requires the court in which the application is filed to “strike and dismiss any counterclaim, cross claim, third party claim, intervention, or cause of action filed by any person in a Rule 736 proceeding.”

And tellingly, Rule 736.9 provides,

“After an order is obtained, a person may proceed with the foreclosure process under applicable law and the terms of the lien sought to be foreclosed.”

Tex.R.Civ.P. 736.9 (emphasis added).

If the Supreme Court of Texas meant that only the petitioner may proceed with the foreclosure, it knew how to say so, and presumably, it would have.[4]

[4] Moreover, the required contents of the order are also specified by rule, and the only names that are expressly required to be included are the names of the respondents.

See Tex. R. Civ. P. 736.8(b).

Kapur cites language from several other subsections of Rule 736 as supporting his conclusion that only the petitioner named in the application and in the court order are authorized to foreclose.

For example, he notes that the petitioner’s application must include descriptions of the petitioner’s authority to foreclose and the specifics of the debtor’s default.

Tex.R.Civ.P. 736.1(d)(3).

But, these are preconditions to foreclosure that the petitioner must prove, regardless of whether the petitioner’s assignment of its powers under a security instrument carries with it the power to foreclose pursuant to an existing Rule 736 order.

Kapur also points out that the application must include the conspicuous statement that “if the petitioner obtains a court order, the petitioner will proceed with a foreclosure of the property in accordance with applicable law and the terms of the loan agreement, contract, or lien sought to be foreclosed.”

Tex.R.Civ.P. 736.1(d)(5)(B).

But, the requirement that the petitioner must state this “conspicuously” demonstrates that this is a notice requirement about the purpose of the proceeding; notice of the actual foreclosure sale is governed by statute.

See Tex. Prop. Code § 51.002.

Rule 736 says nothing about the effect of a petitioner’s post-order assignment of the security instrument and of the petitioner’s powers under it.

C.  Cases Addressing Rule 736 Foreclosures by Successors or Assignees

Finally, Kapur cites a single case that he says supports his position that any entity wishing to foreclose a home- equity lien must obtain its own Rule 736 order.

But the single case he cites does not address successors or assigns at all, while the three cases that do address this situation all upheld foreclosures by successors or assignees.

Kapur relies on A Plus Investments, Inc. v. Rushton, No. 2-03-174-CV, 2004 WL 868866 (Tex. App.-Fort Worth Apr. 22, 2004, no pet.) (mem. op.).

In that forcible-detainer case, the defendant borrowers had defaulted on a home-equity loan from Associates Financial Services Company of Texas, and Associates obtained a Rule 736 order authorizing expedited foreclosure.

Id. at *2.

“A Plus” bought the property at a foreclosure sale and sued to evict the borrowers.

Id.

The justice court ruled in favor of A Plus, but on appeal by trial de novo in the county court at law, the county court dismissed the case for want of jurisdiction.

Id.

A Plus’s evidence for possession had consisted only of the security instrument that secured the loan by Associates, the Rule 736 order authorizing Associates to foreclose, and the deed showing that A Plus bought the property at a foreclosure sale by CitiFinancial, Inc.

Id.

On further appeal, the Second Court of Appeals affirmed the dismissal, explaining,

“There is no evidence in the record to support a link between Associates and CitiFinancial.” Id.

Instead, a foreclosure order in favor of one entity and a foreclosure deed by a seemingly unrelated entity created a title dispute that had to be resolved before possession could be determined. Id.

Because title disputes cannot be litigated in forcible-detainer actions, the case was properly dismissed for want of jurisdiction. Id. at *3.

The case has no application here, because there is no missing link between the entity named in the Rule 736 Order and the entity that foreclosed on the Property.

Instead, the uncontroverted evidence in this case establishes that the 2017 Trustee assigned its interest in the security instrument to the 2021 Trustee.

No party disputes the fact of that assignment; the parties disagree only as to its effect.

So far as we can determine, the only Texas courts to have considered the question have upheld foreclosure sales conducted on behalf of the assignee of the Rule 736 petitioner.

In Spears v. Haynes, Wells Fargo obtained a Rule 736 order authorizing it to foreclose on Spears’s home-equity loan.

No. 09-18-00147-CV, 2020 WL 238539, at *2-3 (Tex. App.-Beaumont Jan. 16, 2020, no pet.) (mem. op.).

After obtaining the order, Wells Fargo “assigned its rights to Spears’s loan and in the judgment” to Bayview, and Bayview’s substitute trustee sold the property, which was then resold to Haynes. Id. at *2.

The Ninth Court of Appeals held that the trial court properly granted summary judgment regarding ownership of the property in Haynes’s favor because Bayview succeeded to Wells Fargo’s right to foreclose on the property.

Id. at *6.

The Third Court of Appeals reached a similar result in Shamel v. Specialized Loan Servicing, LLC, No. 03-12- 00691-CV, 2014 WL 4966330 (Tex. App.-Austin Oct. 2, 2014, no pet.) (sub. mem. op. on denial of reh’g).

In that case, Arch Bay I applied for a Rule 736 order, and while the application was pending, Arch Bay I assigned the note and security instrument to Arch Bay II. Id. at *3.

Although the Rule 736 order named only Arch Bay I as the entity authorized to foreclose, the appellate court held that “Arch Bay II was authorized to foreclose as Arch Bay I’s assignee.”

Id. *12

A federal court applying Texas law reached the same result.

In Hernandez v. Town & Country Credit Corp., the petitioner in the underlying Rule 736 proceeding was Household Finance Corporation III (“HFC”), who was then the noteholder and beneficiary of the security instrument of the Hernandezes’ home-equity loan.

No. 4:15- CV-1718, 2016 WL 11604842, *1 (S.D. Tex. Sept. 23, 2016).

The Rule 736 order authorized HFC and its “Successors and Assigns” to proceed with the foreclosure.

Id.

Nearly three years after the Rule 736 order was signed, the substitute trustee of HFC’s successor foreclosed, and the successor bought the property.

Id. at *1-2.

Like Kapur, the Hernandezes argued that the foreclosure sale and the substitute trustee’s deed were void because under the Texas Constitution, a court order is necessary to foreclose a home-equity loan and the successor did not obtain its own Rule 736 order but relied on the order obtained by its predecessor, HFC.

Id. at *6.

Citing Shamel, the Hernandez court rejected that argument, pointing out that the Rule 736 order authorized HFC’s successor to foreclose.

Id.

Kapur maintains that Shamel is distinguishable because the assignment in that case expressly included the security instrument, the note, and “any rights due or to become due thereon.”

Id.

Although not cited by the parties, the assignment in Spears contained the same language.

Spears, 2020 WL 238539, at *5.

Each of the authoring courts emphasized this language, which is absent from the assignment in this case.

But, we disagree with Kapur’s argument that the omission of such language dictates a different outcome.

There is no indication in Hernandez that the conveyance of the security instrument contained language such as that found in Shamel, but if there was, the Hernandez court did not rely on it.

Rather, the common thread that makes this case like Spears, Shamel, and Hernandez and unlike A Plus is that the evidence establishes the fact of the assignment.

Because there is no evidence that the foreclosure sale is void, both Kapur’s quiet-title claim and his request for declaratory relief must fail.

Because we overrule issues two through eight and affirm traditional summary judgment on the merits, we do not reach Kapur’s contingent ninth issue concerning attorney’s fees.

This also renders moot Kapur’s first issue challenging the no-evidence portion of the summary-judgment motion on procedural grounds.

VI. Conclusion

For the reasons explained above, we affirm the trial court’s judgment.

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It is alleged by Plaintiff Ramesh in a recently dismissed case (2022) before Judge Palmer (the recipient of a reelection donation from Bhagia), that Nanik Bhagia refused process of service at his residence and claimed to ‘know the game’.