# Janos Farkas v. Wells Fargo Bank, N.A. And Brice Vander Linden & Wernic, P.C. N/K/A Buckley Madole, P.C. > Texas Court of Appeals, 3rd District (Austin) · April 20, 2015 URL: https://www.frixlaw.com/law-library/cases/4064231 ## Case - **Court:** Texas Court of Appeals, 3rd District (Austin) - **Decided:** April 20, 2015 - **Precedential status:** Published - **Opinion:** Opinion - **Cited by:** 0 later opinions in the Frix Law Library ## Citator (automated) - No negative treatment found by the automated citator. That is not the same as a confirmation that the case is good law; read the citing cases. - Full citator and citing cases: https://www.frixlaw.com/law-library/cases/4064231 ## Opinion text ACCEPTED 03-14-00716-CV 4954793 THIRD COURT OF APPEALS AUSTIN, TEXAS 4/20/2015 2:40:14 PM JEFFREY D. KYLE CLERK No. 03-14-00716-CV _____________________________________ FILED IN 3rd COURT OF APPEALS AUSTIN, TEXAS In the Third Court of Appeals 4/20/2015 2:40:14 PM JEFFREY D. KYLE _____________________________________ Clerk JANOS FARKAS, Appellant, V. WELLS FARGO BANK, N.A. AND BRICE, VANDER LINDEN & WERNICK, P.C. N/K/A BUCKLEY MADOLE, P.C., Appellees. _____________________________________ On Appeal from Cause No. D-1-GN-11-003692 201st District Court, Travis County, Texas Hon. Lora J. Livingston, Judge Presiding BRIEF OF APPELLEE WELLS FARGO BANK, N.A. Susan A. Kidwell Robert T. Mowrey State Bar No. 24032626 State Bar No. 14607500 skidwell@lockelord.com rmowrey@lockelord.com B. David L. Foster LOCKE LORD LLP State Bar No. 24031555 2200 Ross Avenue, Suite 2200 dfoster@lockelord.com Dallas, Texas 75201 John W. Ellis 214-740-8000 (Telephone) State Bar No. 24078473 214-740-8800 (Facsimile) jellis@lockelord.com LOCKE LORD LLP 600 Congress Avenue, Suite 2200 Austin, Texas 78701 512-305-4700 (Telephone) 512-305-4800 (Facsimile) ATTORNEYS FOR WELLS FARGO BANK, N.A. TABLE OF CONTENTS Page Index of Authorities ..................................................................................................iv Statement of Facts ...................................................................................................... 1 Summary of the Argument......................................................................................... 4 Argument.................................................................................................................... 6 I.  The Trial Court Did Not Abuse Its Discretion in Overruling Farkas’s Objections to Wells Fargo’s Summary-Judgment Evidence........................... 6 A.  The trial court did not abuse its discretion in overruling objections to the declaration of Michael Dolan. ................................... 7 B.  Farkas waived any complaint about the remaining declarations. ....... 11 C.  Conclusory assertions cannot establish harm...................................... 12 II.  The Trial Court Did Not Err in Granting Summary Judgment on Farkas’s Claim for Violations of the Texas Constitution. ............................. 14 A.  The requirements of § 50(a)(6) only apply to “new extensions of credit.” ............................................................................................. 14 B.  Farkas’s constitutional claims fail, as a matter of law, because the alleged “breaches” of the DOT are not alleged constitutional violations. ..................................................................... 17 C.  The trial court’s judgment may also be affirmed on no-evidence grounds. ............................................................................................... 22 III.  The Trial Court Did Not Err in Granting Summary Judgment on Farkas’s Claim for Violations of the Texas Debt Collection Act. ................ 24 IV.  The Trial Court Did Not Err in Granting Summary Judgment on Farkas’s Fraudulent-Lien Claim. ................................................................... 27 ii Prayer ....................................................................................................................... 31 Certificate of Compliance ........................................................................................ 33 Certificate of Service ............................................................................................... 33 iii INDEX OF AUTHORITIES Page(s) CASES Anderson v. Nat’l City Mortg., No. 3:11-CV-1687-N, 2012 WL 612562 (N.D. Tex. Jan. 17, 2012) ................... 8 Bierwirth v. BAC Home Loans Servicing, L.P., No. 03-11-00644-CV, 2012 WL 3793190 (Tex. App.—Austin Aug. 30, 2012, pet. denied) (mem. op.) ............................................................................. 29 Cornish v. Washington Mut. Bank, FA, No. 02-06-400-CV, 2007 WL 2285478 (Tex. App.—Fort Worth Aug. 9, 2007, pet. denied)................................................................................................ 11 Farkas v. Aurora Loan Servs., LLC, No. 05-12-01095-CV, 2013 WL 6198344 (Tex. App.—Dallas Nov. 26, 2013, pet. denied).................................................................................................. 9 First Am. Title Ins. Co. v. Strayhorn, 169 S.W.3d 298 (Tex. App.—Austin 2005), aff’d 258 S.W. 3d 627 (Tex. 2008) .......................................................................................................... 22 Golden v. Wells Fargo Bank, N.A., 557 Fed. App’x 323 (5th Cir. Feb. 20, 2014) ..................................................... 28 In re J.P.B., 180 S.W.3d 570 (Tex. 2005) ................................................................................ 6 Jaimes v. Fed. Nat’l Mortg. Ass’n, 930 F.Supp.2d 692 (W.D. Tex. 2013) ................................................................ 28 Jones v. JP Morgan Chase Bank, N.A., No. 4:13-CV-456, 2014 WL 2996673 (E.D. Tex. July 3, 2014) ........................ 28 Kerlin v. Arias, 274 S.W.3d 666 (Tex. 2008) ............................................................................ 8, 9 LaSalle Bank Nat’l Ass’n v. White, 246 S.W.3d 616 (Tex. 2007) ........................................................................ 16, 20 iv Lassberg v. Barrett Daffin Frappier Turner & Engel, L.L.P., No. 4:13-CV-577, 2015 WL 123756 (E.D. Tex. Jan. 8, 2015) .......................... 28 Liberty Mut. Ins. Co. v. Griesing, 150 S.W.3d 640 (Tex. App.—Austin 2004, pet. dism’d w.o.j.)......................... 26 Marsh v. JPMorgan Chase Bank, N.A., 888 F. Supp. 2d 805 (W.D. Tex. 2012) .............................................................. 30 Perdomo v. Fed. Nat’l Mortg. Ass’n, No. 3:11-CV-734-M, 2013 WL 1123629 (N.D. Tex. Mar. 18, 2013) ............... 28 Pickett v. Tex. Mut. Ins. Co., 239 S.W.3d 826 (Tex. App.—Austin 2007, no pet.) .......................................... 22 Rockwall Commons Assocs., Ltd. v. MRC Mortg. Grantor Trust I, 331 S.W.3d 500 (Tex. App.—El Paso 2010, no pet.) ........................................ 25 Seaprints, Inc. v. Cadleway Props., Inc., 446 S.W.3d 434 (Tex. App.—Houston [1st Dist.] 2014, no pet.) ...................... 11 Sims v. Carrington Mortg. Servs., L.L.C., 440 S.W.3d 10 (Tex. 2014)...............................................................14, 15, 20, 23 Star-Telegram, Inc. v. Doe, 915 S.W.2d 471 (Tex. 1995) .............................................................................. 22 Steptoe v. JPMorgan Chase Bank, N.A., No. 01-14-00813-CV, 2015 WL 1263128, at *3 (Tex. App.—Houston [1st Dist. Mar. 19, 2015, no pet. h.) ........................................................18, 19, 26 Stringer v. Cendant Mortg. Corp., 23 S.W.3d 353 (Tex. 2000)...........................................................................14, 20 Superior Energy Servs., Inc. v. Sonic Petroleum Servs., Ltd., 328 S.W.3d 623 (Tex. App.—Eastland 2010, no pet.) ......................................... 8 Tex. Dep’t of Transp. v. Able, 35 S.W.3d 608 (Tex. 2000)................................................................................... 7 Vincent v. Bank of Am., N.A., 109 S.W.3d 856 (Tex. App.—Dallas 2003, pet. denied).................................... 16 v Voice of the Cornerstone Church Corp. v. Pizza Prop. Partners, 160 S.W.3d 657 (Tex. App.—Austin 2005, no pet.) ..............................22, 24, 29 Wells Fargo Bank, N.A. v. Robinson, 391 S.W.3d 590 (Tex. App.—Dallas 2012, no pet.) ..............................16, 17, 23 CONSTITUTIONAL PROVISIONS TEX. CONST. art. XVI, § 50 ...................................................................................... 14 TEX. CONST. art. XVI, § 50(a)(6) ......................................................................passim TEX. CONST. art. XVI, § 50(a)(6)(D) .............................................................3, 16, 18 TEX. CONST. art. XVI, § 50(a)(6)(I) ......................................................................... 16 TEX. CONST. art. XVI, § 50(a)(6)(Q)(x) .............................................................15, 22 TEX. CONST. art. XVI, § 50(k) ................................................................................. 18 TEX. CONST. ART. XVI, § 50(t) ............................................................................. 2, 18 STATUTES TEX. CIV. PRAC. & REM. CODE § 12.001(d) ............................................................. 28 TEX. CIV. PRAC. & REM. CODE § 12.002............................................................ 28, 30 TEX. CIV. PRAC. & REM. CODE § 12.002(a) ............................................................. 29 TEX. CIV. PRAC. & REM. CODE § 12.002(a)(2) ........................................................ 30 TEX. FIN. CODE § 31.002(a)(34)............................................................................... 15 TEX. FIN. CODE § 392.001. ....................................................................................... 25 TEX. FIN. CODE § 392.403(a)(2)............................................................................... 27 vi RULES TEX. R. APP. P. 38.1(i).............................................................................................. 25 TEX. R. APP. P. 38.2(1)(B) ......................................................................................... 1 TEX. R. APP. P. 44.1 ................................................................................................... 7 Tex. R. Civ. P. 166a(c).........................................................................................7, 25 TEX. R. CIV. P. 166a(f) .......................................................................................7, 8, 9 TEX. R. CIV. P. 735.1 ................................................................................................ 18 TEX. R. CIV. P. 735.3 ................................................................................................ 18 TEX. R. CIV. P. 736 .........................................................................................3, 18, 26 TEX. R. CIV. P. 736.11(a) ........................................................................................... 4 TEX. R. CIV. P. 736.11 (c) .......................................................................................... 4 TEX. R. EVID. 801(d) .................................................................................................. 7 vii TO THE HONORABLE THIRD COURT OF APPEALS: After defaulting on a home-equity loan, Appellant Janos Farkas filed the underlying lawsuit to prevent Appellee Wells Fargo Bank, N.A., from obtaining an expedited court order to foreclose on his property. Although he succeeded in delaying foreclosure, he was unable to withstand summary judgment. Farkas’s brief essentially repeats his response to Wells Fargo’s motion (and his objections to some of Wells Fargo’s summary-judgment evidence). Those arguments were properly rejected by the trial court, so they provide no basis for relief on appeal. The trial court’s judgment should be affirmed in its entirety. STATEMENT OF FACTS Farkas’s “statement of undisputed facts” is incomplete. It also contains a number of inaccurate characterizations about documents in the record. Accordingly, Wells Fargo provides its own statement. See TEX. R. APP. P. 38.2(1)(B). On January 11, 2007, Farkas executed an Account Agreement (CR:47-61) and a Texas Deed of Trust (CR:70-81) securing a home equity line of credit in the principal amount of $103,441.00. The Account Agreement and the Deed of Trust will be collectively referred to as the “Loan Documents.” The Loan Documents define the “Borrower” as “Janos Farkas” and the “Lender” as “Wells Fargo Bank, N.A.” (CR:47, 70.) In accordance with Texas law, the Loan Documents state that they relate to “an extension of credit as defined by section 50(a)(6) and 50(t), Article XVI of the Texas Constitution.” (Id.) The Deed of Trust (“DOT”) securing the loan provides that “Borrower will be in default if (1) any payment required by the Debt Instrument or this Security instrument is not made when it is due . . . .” (CR:78.) In the event of a default, the DOT requires Wells Fargo to provide Farkas with notice before invoking remedies of acceleration and foreclosure. (CR:78-79.) The notice must specify: “(a) the default; (b) the action required to cure the default; (c) a date, not less than 30 days from the date the notice is given to Borrower, by which the default must be cured; and (d) that failure to cure the default on or before the date specified in the notice will result in acceleration of the sums secured by this Security Instrument and sale of the Property.” (CR:79.) In accordance with Texas law, the DOT also states that “[t]he lien evidenced by this Security Instrument may be foreclosed upon only by a court order.” (Id.) On April 21, 2011, Wells Fargo, through its foreclosure counsel (Brice, Vander Linden & Wernick, P.C.), sent Farkas a “Notice of Default and Intention to Accelerate.” (CR:87.) In accordance with the DOT, the notice states that (a) “the loan is in default for failure to make the regular monthly payments required by the 2 Note and Deed of Trust”; (b) the amount required to cure the default1 and the address to which payment should be made; (c) the default must be cured “within thirty (30) days of the date of this notice”; and (d) if the default is not cured by that date, “the Note will be accelerated and all sums secured by the Deed of Trust will be declared to be immediately due and payable.” (Id.) Instead of curing his default, Farkas sent a letter “request[ing] a validation of debt under the Fair Debt Collection Practices Act stating the owner of the debt (creditor) with its address.” (CR:200.) Wells Fargo provided Farkas with the current amount to cure the default ($19,604.23), the current amount to pay off the loan ($123,127.31), and the lender’s name and address. (CR:89, 203-04.) Farkas did not remit either amount, so on June 23, 2011, Well Fargo’s foreclosure counsel sent Farkas notice that the debt was being accelerated. (CR:90.) In September 2011, as permitted by the DOT (CR:79) and Rule 736 of the Texas Rules of Civil Procedure, Wells Fargo applied for an expedited “court order allowing foreclosure of a lien under Tex. Const. Art. XVI, Section 50(a)(6)(D).” (See CR:92.) But, before Wells Fargo could obtain an order, Farkas filed the underlying lawsuit challenging Wells Fargo’s ability to foreclose. (See CR:3.) Farkas’s filing of an independent lawsuit automatically stayed Wells Fargo’s Rule 1 As of March 22, 2011, the amount was $2,013.30. (CR:87.) However, the notice states that “the amount required to cure the default on the day you choose to pay may be greater.” (Id.) 3 736 proceeding, which was subsequently dismissed See TEX. R. CIV. P. 736.11(a), (c). Wells Fargo moved for traditional and no-evidence summary judgment on all of Farkas’s claims. (See CR:15.) Brice, Vander Linden & Wernick, P.C. (“Brice”), which was also named as a defendant, did the same. (CR:343.) Farkas filed his own motion for partial summary judgment, and attached many of the same documents filed in support of Wells Fargo’s motion. (See CR:173.) He also objected to some of Wells Fargo’s summary-judgment evidence. (CR:505.) After considering the motions, the responses, the pleadings, the arguments of counsel, and “all other matters properly before the Court,” the trial court granted Wells Fargo’s and Brice’s motions, denied Farkas’s motion, overruled Farkas’s objections to the evidence, and entered a final judgment that Farkas take nothing on his claims. (CR:604-05.) This appeal ensued. (CR:608.) SUMMARY OF THE ARGUMENT 1. Objections to Summary-Judgment Evidence: Farkas cannot cite any legal authorities to support his contention that the trial court abused its discretion in overruling groundless objections to some of Wells Fargo’s summary-judgment evidence. So he relies on unsupported assertions that run afoul of the following principles:  Statements in a business-records affidavit are not “hearsay”; 4  A judgment cannot “turn” on “irrelevant” statements, so complaints about them cannot establish reversible error;  Statements based on personal knowledge need not be confirmed by documentary evidence;  “Inconsistencies” between the amounts required to cure a default and the amounts required to pay off a loan at different points of time do not require striking the evidence;  Generalized objections – unsupported by arguments based on legal authorities or citations to the record – are insufficient to preserve error; and  Conclusory assertions that unproven errors “probably resulted in an improper judgment” are also insufficient to preserve error. 2. The Constitutional Claim: Farkas’s claim that Wells Fargo violated Article XIV, § 50(a)(6) of the Texas Constitution is premised on a false theory. None of the alleged “violations” relate to any constitutional requirements, so Farkas’s claim fails as a matter of law. The trial court’s judgment may also be affirmed on no-evidence grounds. 3. The Texas Debt Collection Act Claim: Farkas failed to negate all grounds for summary judgment on his TDCA claim. That, by itself, requires that the judgment be affirmed. Farkas also waived any complaint on this issue by failing to provide a cognizable legal argument supported by citations to authority 5 and the record. Finally, even if considered, Farkas’s argument should be rejected as contrary to the record and unsupported by the law. 4. The Fraudulent Lien Claim: Farkas makes little effort to salvage his fraudulent-lien claim. His two-page “argument” contains no citations to the record, no legal argument supported by authorities, and fails to negate all grounds for summary judgment. His argument also fails on the merits. A notice of default is not a “lien,” and Farkas’s hyper-technical complaints about statements in the notice neither constitute fraud nor caused any damages. Because his fraudulent- lien claim fails as a matter of law, it comes as no surprise that Farkas cannot cite to any evidence to support multiple elements that were challenged below. In short, the judgment should be affirmed in its entirety as demonstrated more fully below: ARGUMENT I. The Trial Court Did Not Abuse Its Discretion in Overruling Farkas’s Objections to Wells Fargo’s Summary-Judgment Evidence. Farkas reveals the weakness of his appeal by leading with an argument that the trial court erred in overruling objections to some of Wells Fargo’s summary- judgment evidence. (See Br. at 9-17.) But, by simply repeating the same arguments the trial court rejected, Farkas fails to show how the trial court abused its discretion. See In re J.P.B., 180 S.W.3d 570, 575 (Tex. 2005) (reviewing evidentiary rulings under abuse of discretion standard). Nor do his conclusory 6 assertions about harm show how “the judgment turns on the particular evidence excluded or admitted,” as required for relief on appeal. See Tex. Dep’t of Transp. v. Able, 35 S.W.3d 608, 617 (Tex. 2000); TEX. R. APP. P. 44.1. Farkas’s first argument should be summarily rejected. A. The trial court did not abuse its discretion in overruling objections to the declaration of Michael Dolan. In scattershot fashion, Farkas lodges various attacks on the business-records declaration of Michael Dolan. (See Br. at 12-15.) None have any merit. Farkas first asserts that the Dolan declaration “contains inadmissible hearsay.” (Br. at 12.) However, “‘[h]earsay’ is a statement, other than one made by the declarant . . . offered in evidence to prove the truth of the matter asserted.” TEX. R. EVID. 801(d) (emphasis added). Statements by a declarant in a business- records affidavit do not fall within this definition. That is why such affidavits are a valid and commonly-used form of summary-judgment proof. See TEX. R. CIV. P. 166a(c), (f). Unable to back up his novel theory of “hearsay” with any citation to authority, Farkas’s argument quickly morphs into unsupported assertions about the factual accuracy of two isolated statements in the affidavit. (See Br. at 12-13.) He first complains that Dolan’s statement that “home equity loan and lines of credit were ‘available through Wells Fargo Home Equity Group’ is misleading and irrelevant to this proceeding.” (Br. at 13 (emphasis added).) But, because the 7 judgment cannot “turn” on an “irrelevant” statement, Farkas’s first complaint does not concern reversible error. Farkas also asserts that there is “zero documentation”2 to support Dolan’s statement that “‘Wells Fargo Home Equity’ is a division of Wells Fargo Bank, N.A.” (Br. at 13.) But Farkas cites no authority requiring statements based on personal knowledge to be supported by documentary evidence as well. To the contrary, the personal-knowledge requirement is satisfied when, as here, an affidavit (i) states that it is based on personal knowledge and the facts in it are true and (ii) shows the basis for the affiant’s personal knowledge. See TEX. R. CIV. P. 166a(f); Kerlin v. Arias, 274 S.W.3d 666, 668 (Tex. 2008). Dolan states that he has “personal knowledge of each of the matters stated herein, and they are true and correct.” (CR:43.) In addition, he explains the basis for his knowledge: “I am employed as a Research and Mediation Manager for Wells Fargo Bank, N.A. (‘Wells Fargo’). I am also the custodian of the records of Wells Fargo. I have also personally reviewed Wells Fargo’s records regarding the 2 The record, in fact, does contain documentation to support Dolan’s statement. A letter from “Wells Fargo Bank, N.A. Home Equity Group” states that Farkas contacted “Wells Fargo Home Equity regarding [his] account.” (CR:64.) In addition, the Account Agreement identifies the account as a “Wells Fargo Home Equity Account.” (CR:47.) That evidence confirms the undisputable relationship between Wells Fargo Bank and one of its divisions, the Wells Fargo Home Equity Group. “A division of a corporation is not a separate legal entity but the corporation itself.” Superior Energy Servs., Inc. v. Sonic Petroleum Servs., Ltd., 328 S.W.3d 623, 631 (Tex. App.—Eastland 2010, no pet.). Similarly, a lender and a division of the lender are “the same entity for all intents and purposes.” Anderson v. Nat’l City Mortg., No. 3:11-CV- 1687-N, 2012 WL 612562, at *1 n.1 & n.3 (N.D. Tex. Jan. 17, 2012). 8 mortgage debt at issue in the above-captioned lawsuit (the ‘Loan’).” (Id.) Dolan also states “I am familiar with Wells Fargo’s lending and mortgage servicing practices, including the various groups and divisions within Wells Fargo through which it carries out those practices.” (CR:45.) These statements are plainly sufficient to satisfy the applicable legal standard. See T EX. R. CIV. P. 166a(f); Kerlin, 274 S.W.3d at 668. Farkas reveals nothing but desperation when he tries to question Dolan’s credibility. (See Br. at 13.) Dolan’s statement that he has been “employed by Wells Fargo and its predecessor institutions” (i.e., banks acquired by Wells Fargo through various mergers) for “28 years” (CR:44) is not a claim that he started working for Wells Fargo more than 160 years ago, as Farkas tries to suggest. (Br. at 13.) Moreover, nothing in Texas law requires a business-records custodian to specify the exact number of years he has worked for his employer. See TEX. R. CIV. P. 166a(f); Kerlin, 274 S.W.3d at 668. Thus, contrary to Farkas’s belief, the absence of such information does not cast any doubt on Dolan’s personal knowledge. The Dallas Court of Appeals recently rejected similar challenges to a similar affidavit in a similar appeal filed by Farkas. Farkas v. Aurora Loan Servs., LLC, No. 05-12-01095-CV, 2013 WL 6198344, at *3 (Tex. App.—Dallas Nov. 26, 2013, pet. denied). There, as here, “Farkas d[id] not cite to any evidence in the 9 record controverting the appellees’ evidence.” Id. There, as here, his “unsupported assertions that [an] affidavit is factually inaccurate [were] insufficient” to show reversible error. Id. And there, as here, the trial court properly considered the challenged affidavit as summary-judgment evidence. See id. Farkas demonstrates utter confusion in arguing that Dolan’s declaration contains “inconsistencies when compared to . . . other [summary-judgment] evidence.” (See Br. at 14 (emphasis added).) The alleged “inconsistencies” are simply differences between the “amount required to cure Plaintiff’s default” on March 22, 2011 ($2,013.30) versus June 20, 2011 ($19,604.23), and differences between those amounts and the amount required to pay off the entire loan ($123,127.31 as of June 20, 2011). (Compare CR:45, with CR:87, 203, 204.) Farkas appears to assume that the “amounts owed” should have remained constant over time. But he ignores the distinction amounts to cure the default and amounts to pay off the loan. He also ignores the impact of interest and other expenses (such as property taxes and attorneys’ fees related to foreclosure proceedings) that accrue over time. In short, the longer Farkas waited to cure his default, the more expensive any available cure became. That Farkas would point to these alleged “inconsistencies” as evidence of reversible error only confirms that he has no viable grounds to challenge the trial court’s ruling. 10 B. Farkas waived any complaint about the remaining declarations. Resorting to hyperbole, Farkas transforms the alleged “inconsistencies” into “wildly varying accounts as to the amounts allegedly owed.” (Br. at 15.) Then, without any citation to the record or supporting legal authorities, he claims that “[t]he conflicting portions of all of these declarations should be struck due to inconsistencies.” (Id. (emphasis added).3) This two-sentence “argument” has multiple defects, any one of which is fatal: First, Farkas’s generalized objection to “all of these declarations” (Br. at 15) “fails to identify specific objectionable portions of the [declarations] or explain why any particular passages should be disregarded as [conflicting].” See Seaprints, Inc. v. Cadleway Props., Inc., 446 S.W.3d 434, 442 (Tex. App.— Houston [1st Dist.] 2014, no pet.); see also Cornish v. Washington Mut. Bank, FA, No. 02-06-400-CV, 2007 WL 2285478, at *3 (Tex. App.—Fort Worth Aug. 9, 2007, pet. denied) (“the part[y] objecting to an affidavit must identify the specific statements in the affidavit that are objectionable and state why they are objectionable”). Farkas’s complaints about unidentified but allegedly “conflicting portions” of the declarations are “inadequate” and, therefore, insufficient to preserve error. See Seaprints, 446 S.W.3d at 442. 3 This statement appears to be referencing the Declarations of Sammy Hooda (CR:84) and B. David L. Foster (CR:150). 11 Second, the declarations do not contain any “conflicting” statements. Although Farkas complains about “wildly varying accounts as to amounts allegedly owed,” neither the Hooda nor the Foster declaration includes any statement about amounts allegedly owed. (See CR:84-86, 150-51.) Only the Dolan declaration contains such statements, so there is not conflict between “all of these declarations.” Moreover, the amounts referenced in the Dolan declaration, which states that “[t]he amount required to cure Plaintiff’s default on the Loan as of March 22, 2011 was $2,013.30” and “[t]he amount required to cure Plaintiff’s default on the Loan as of July 25, 2011 was $4,002.64” (CR:45) are consistent with documentary evidence in the summary-judgment record. (CR:87&148; CR:69.) Third, although the documentary evidence attached to the declarations shows variations in the amounts required to cure the default and the amounts required to pay off the loan at different times, those variations have already been explained. Farkas’s unfounded assumption that the “amounts owed” should have remained constant over time is unsupported by the record and defies common sense. C. Conclusory assertions cannot establish harm. Recognizing his burden to show that the alleged error “probably resulted in an improper judgment,” Farkas asserts that, “[i]f the Declaration of Michael Dolan were struck, Wells_Bank’s MSJ would have to be denied.” (Br. at 15.) But Farkas 12 later concedes that the ruling on his objections “is not necessary nor dispositive of any ruling on Wells_Bank’s and Brice’s summary judgment motions concerning TDCA claims.” (Br. at 27.) And he never explains why the ruling is “necessary and dispositive” of his other claims. Nor could he. Wells Fargo presented multiple grounds for traditional and no-evidence summary judgment. (See CR:19-40.) Obviously, Wells Fargo did not have to present any evidence to prevail on its no-evidence grounds. For that reason alone, the judgment does not “turn” on the evidentiary rulings and, therefore, Farkas cannot show that the trial court’s rulings constitutes reversible error. In addition, Farkas cannot show that any of the traditional grounds require proof of the allegedly “disputed” (and entirely immaterial) facts over which Farkas obsesses. As explained more fully below, they do not. A judgment cannot turn on immaterial facts. Finally, even if the Dolan affidavit were stricken in its entirety, evidence attached to his affidavit is duplicated elsewhere in the record.4 Because those documents are sufficient to support Wells Fargo’s traditional grounds, Farkas cannot show that striking the Dolan declaration would have had any effect on the outcome. 4 For example, the Account Agreement appears at CR:116 and CR:272, and documents establishing various reinstatement and payoff amounts appear at CR:140-43 and 198-213. 13 To sum up: Farkas has not shown that the trial court abused its discretion by denying his objections to some of Wells Fargo’s summary-judgment evidence. Nor has Farkas shown how the alleged error was harmful. His complaints about the trial court’s evidentiary rulings provide no basis for reversal. II. The Trial Court Did Not Err in Granting Summary Judgment on Farkas’s Claim for Violations of the Texas Constitution. Farkas’s theory that Wells Fargo violated the Constitution by breaching terms in the Loan Documents (Br. at 17-23) is pure fiction. The alleged “violations” do not involve conduct that is regulated by the Constitution, so they could never support a constitutional claim. Nor is there any evidence to support Farkas’s repeated assertions that Wells Fargo failed to comply with the Loan Documents. False assertions about imaginary “violations” cast no doubt on the trial court’s judgment. A. The requirements of § 50(a)(6) only apply to “new extensions of credit.” “[H]ome equity loans are subject to the requirements of Article XVI, Section 50 of the Texas Constitution.” Sims v. Carrington Mortg. Servs., L.L.C., 440 S.W.3d 10, 11 (Tex. 2014). “Section 50(a)(6), in its totality, establishes the terms and conditions a home-equity lender must satisfy to make a valid loan.” Stringer v. Cendant Mortg. Corp., 23 S.W.3d 353, 356 (Tex. 2000). The detailed 14 constitutional requirements, however, only apply to “new extension[s] of credit.” Sims, 440 S.W.3d at 17. The term “extension of credit” refers to “‘direct or indirect advances of money . . . to a person that are conditioned on the obligation of the person to repay . . . .’” Id. at 16 n.22 (quoting TEX. FIN. CODE § 31.002(a)(34)). If a transaction does “not involve the satisfaction or replacement of the original note, an advancement of new funds, or an increase in the obligations created by the original note,” then “it is not a new extension of credit that must meet the requirements of Section 50.” Id. at 17. If, in making a new extension of credit, a lender fails to comply with section 50, it has 60 days to cure its failure by taking specified actions that include returning any overcharges paid by the owner, sending written confirmation that the loan terms (e.g., interest rates) are only valid to the extent they comply with constitutional requirements, or modifying the loan agreement to comply with constitutional requirements. See TEX. CONST. art. XVI, § 50(a)(6)(Q)(x). Because the constitutional requirements only relate to new extensions of credit, the methods of cure necessarily involve taking actions to ensure that the extension of credit at issue, i.e., the initial loan agreement, complies with the law. See id. If a lender “fails to correct [its] failure to comply not later than the 60th day after the date the lender or holder is notified by the borrower of the lender’s failure to comply,” then 15 the lender or holder “shall forfeit all principal and interest of the extension of credit.” Id. For example, § 50(a)(6)(I) “prohibits home-equity loans from being ‘secured by homestead property designated for agricultural use.’” LaSalle Bank Nat’l Ass’n v. White, 246 S.W.3d 616, 619 (Tex. 2007) (quoting TEX. CONST. art. XVI, § 50(a)(6)(I)). Thus, a home-equity loan secured by property designated for agricultural use violates the Constitution and is subject to forfeiture. Id. The Constitution also “requires that a home equity note be secured by a lien that may only be foreclosed by court order.” Wells Fargo Bank, N.A. v. Robinson, 391 S.W.3d 590, 595 (Tex. App.—Dallas 2012, no pet.) (discussing TEX. CONST. art. XVI, § 50(a)(6)(D)). However, as long as a deed of trust requires a court order for foreclosure, it complies with constitutional requirements. Id. In cases involving complaints about how foreclosure was conducted, the constitutional remedy of forfeiture is not appropriate. See id. In short, “forfeiture is only available for violations of constitutionally mandated provisions of the loan documents.” Vincent v. Bank of Am., N.A., 109 S.W.3d 856, 862 (Tex. App.—Dallas 2003, pet. denied). “A borrower’s recourse for a lender’s failure to abide by the terms of his loan agreement is to assert traditional tort and breach of contract causes of action,” not claims for violations of Article XVI, § 50(a)(6) of the Texas Constitution. Robinson, 391 S.W.3d at 595. 16 B. Farkas’s constitutional claims fail, as a matter of law, because the alleged “breaches” of the DOT are not alleged constitutional violations. The fatal problem that condemns Farkas’s constitutional claim is that Farkas does not complain about any alleged violations of constitutional requirements. Instead, he repeatedly asserts that Wells Fargo violated the DOT. (See Br. at 17- 21.) However, as a matter of law, alleged breaches of contract are not actionable under the Constitution. See Robinson, 391 S.W.3d at 595. Moreover, Farkas’s hyper-technical complaints about statements in a notice of default do not violate any terms in the DOT, much less rise to the level of a constitutional violation. 1. Farkas has not alleged any constitutional violation. Farkas has never challenged the validity of the Loan Documents. Nor has he ever taken the position that Wells Fargo failed to satisfy any of the constitutional requirements to make a valid loan. Instead, he bases his “constitutional” claim on allegations that the notice of default refers to a “wrong” loan number, mentions “non-judicial foreclosure,” and demands that Farkas cure his default “within 30 days” of the notice rather than “not less than 30 days” from the notice. (Br. at 19- 20.) There are two fundamental problems: (i) Farkas’s complaints are groundless. The loan number: Farkas repeatedly asserts that the notice references the “wrong” loan number. However, the summary-judgment evidence shows that the 17 “Loan Number” on the notice of default (0999617061) is an “internal reference number” used by Wells Fargo and Brice for their own, internal purposes. (CR:46, 86.) The undisputed fact that the notice of default makes no reference to either the “Account Number” (650-650-4349999-1XXX) or the “reference Number” (20063367500009) shown on the DOT is immaterial, because neither the Constitution nor the DOT require a notice of default to include any reference to a loan number. The reference to “non-judicial foreclosure”: The Texas Constitution requires a lien on a home-equity loan to “be foreclosed upon only be a court order.” TEX. CONST. art. XVI, § 50(a)(6)(D) (emphasis added). From that language, Farkas assumes that the reference to a “court order” means a lender is required to pursue a “judicial foreclosure.” His assumption is false. “Rule 736 [of the Texas Rules of Civil Procedure] provides the procedure for obtaining a court order, when required, to allow foreclosure of a lien containing a power of sale in the security instrument . . . securing . . . a home equity loan, reverse mortgage, or home equity line of credit under article XVI, sections 50(a)(6), 50(k), and 50(t) of the Texas Constitution.” TEX. R. CIV. P. 735.1. A Rule 736 court order permitting a non-judicial foreclosure is not a judicial foreclosure. See TEX. R. CIV. P. 735.3; see also Steptoe v. JPMorgan Chase Bank, N.A., No. 01-14-00813-CV, 2015 WL 1263128, at *3 (Tex. App.—Houston [1st 18 Dist.] Mar. 19, 2015, no pet. h.) (recognizing distinction between judicial foreclosure and Rule 736 proceeding to obtain court order “to proceed with a non- judicial foreclosure”). When, as here,5 the “home-equity lender has contracted for the right of non-judicial foreclosure under a power of sale provision, [it] may choose to pursue the special procedure found in Rule 736 to obtain an order allowing it to proceed with a non-judicial foreclosure under the Texas Property Code.” See Steptoe, 2015 WL 1263128, at *3. That is exactly what Wells Fargo did when it initiated a Rule 736 proceeding to obtain the requisite court order permitting non-judicial foreclosure. (See CR:92.) But Farkas obstructed Wells Fargo’s efforts by filing this lawsuit and complaining about non-existent constitutional “violations.” (See CR:3.) The deadline: Farkas’s hyper-technical suggestion that requiring payment within 30 days violates the DOT provision requiring payment “not less than 30 days” from notice is semantic nonsense. (See Br. at 20.) Because a 30-day deadline is both “within” 30 days of notice and “not less than” 30 days of notice, it complies with the DOT as a matter of law. 5 The DOT provides: “The lien evidence by this Security Instrument may be foreclosed upon only by a court order. Lender may, at its option, follow any rules of civil procedure promulgated by the Texas Supreme Court for expedited foreclosure proceedings related to the foreclosure of liens under Section 50(a)(6), Article XVI of the Texas Constitution . . . .” (CR:79.) 19 (ii) Farkas’s complaints are not actionable under the Constitution. As explained, the Constitution focuses on the terms of the initial loan agreement, not the manner in which a lender may enforce that agreement in the event of a borrower’s default. See TEX. CONST. art. XVI, § 50(a)(6); Sims, 440 S.W.3d at 16 n.22. Thus, there is no language in § 50(a)(6) that pertains to notices of default, much less any language that:  requires a lender to include any particular type of “loan number” on the notice (or prohibits foreclosure counsel from including its own internal reference number on the notice);  requires a lender to specify the type of foreclosure remedy that will be conducted (or prohibits a lender from stating that it was asked to pursue a “non-judicial foreclosure in accordance with the terms of the Note and the Deed of Trust and applicable law”); or  requires a lender to demand payment “not less than 30 days from the date notice [of default] is given” (or prohibits a lender from demanding payment “within 30 days of the date of this notice”). (Contra Br. at 19-22.) “When interpreting the Texas Constitution,” the Texas Supreme Court “‘rel[ies] heavily on its literal text and must give effect to its plain language.’” LaSalle Bank, 246 S.W.3d at 619 (quoting Stringer, 23 S.W.3d at 355). Applying that principle, the Court “decline[s] to engraft [unwritten] prohibition[s] onto the constitutional language.” Id. This Court should do the same. Because nothing in the Constitution prohibited Wells Fargo from referencing an internal loan number, 20 pursuing non-judicial foreclosure, or demanding payment within 30 days, Farkas’s complaints about the notice of default cannot support a constitutional claim. 2. Farkas has not even alleged facts that would support a claim for breach of contract. Unable to identify any constitutional requirement that was potentially violated, Farkas asserts that Wells Fargo failed to comply with the DOT. (See Br. at 17-21.) That unpleaded claim is not at issue. In any event, the notice of default establishes – on its face – that it includes all information required by the DOT. (Compare CR:79 (DOT requirements), with CR:87 (notice).) Contrary to Farkas’s apparent belief, nothing in the DOT:  required Wells Fargo to include any particular type of “loan number” on its notice of default (or prohibited foreclosure counsel from including its own internal reference number on the notice);  required Wells Fargo to specify the type of foreclosure remedy that would be conducted (or prohibited foreclosure counsel from making a reference to a “non-judicial foreclosure in accordance with the terms of the Note and the Deed of Trust and applicable law”); or  required Wells Fargo to demand payment “not less than 30 days from the date notice [of default] is given” (or prohibited foreclosure counsel from demanding payment “within 30 days” of the date the notice of default was given. Consequently, Wells Fargo (through foreclosure counsel) could not have “breached” the DOT by referring to an internal loan number, stating that it had been “requested to pursue a non-judicial foreclosure,” or demanding payment “within 30 days.” (CR:87.) As the trial court correctly concluded, Farkas’s faulty 21 constitutional theory and groundless allegations are insufficient to survive summary judgment. C. The trial court’s judgment may also be affirmed on no-evidence grounds. Implicitly recognizing his burden to negate all grounds for summary judgment,6 Farkas falsely contends that “Wells-Bank fails to challenge specific element of complaint regarding liability under TEX. CONST. ART. XVI, §50(a)(6)(Q)(x).” (Br. at 23.) But again, Farkas fails to support his “argument” with any citation to legal authorities or the record. And again, his “argument” is premised on an invalid theory of liability. Section 50(a)(6)(Q)(x) is the provision that specifies methods to cure a failure to comply with requirements applicable to new extensions of credit. None of those methods have any application here, because Farkas has never complained that the initial extension of credit violated section 50. Although he contends that “there is no support” for an argument that “the constitutional obligation to fulfill the terms of extension of credit” only applies to “origination of the extension of credit” (see Br. at 22), he ignores the Texas Supreme Court’s recent decision in 6 This Court has repeatedly recognized that, “[w]hen the trial court does not specify the basis for its summary judgment, the appealing party must show it is error to base it on any ground asserted in the motion.” Pickett v. Tex. Mut. Ins. Co., 239 S.W.3d 826, 840 (Tex. App.—Austin 2007, no pet.) (citing Star-Telegram, Inc. v. Doe, 915 S.W.2d 471, 473 (Tex. 1995)); accord First Am. Title Ins. Co. v. Strayhorn, 169 S.W.3d 298, 303 (Tex. App.—Austin 2005), aff’d 258 S.W.3d 627 (Tex. 2008); Voice of the Cornerstone Church Corp. v. Pizza Prop. Partners, 160 S.W.3d 657, 671 (Tex. App.—Austin 2005, no pet.). If the appellant fails to meet this burden, “the summary judgment must be affirmed.” Voice of the Cornerstone, 160 S.W.3d at 671. 22 Sims, 440 S.W.3d at 17. That decision makes it amply clear that the requirements in section 50 only apply to “new extensions of credit.” Id. Farkas thus spins in circles when he asserts that “Wells_Bank had ample opportunity to cure” but “chose not to cure.” (See Br. at 21.) Absent a violation, there is nothing to cure. Farkas is also wrong in asserting that Wells Fargo did not allege specific no- evidence grounds relating to his faulty constitutional theory. In its motion for summary judgment, Wells Fargo argued: Plaintiff has no evidence that the loan was invalid at the time of origination or somehow later became invalid. Moreover, Plaintiff has no evidence that any alleged violation was not cured, as no non- judicial foreclosure sale occurred. (CR:37.) Farkas cannot overcome his failure to allege and present evidence of a constitutional violation by asserting that Wells Fargo failed to cure an imaginary violation. Farkas presented no evidence of violation in response to Wells Fargo’s motion in the trial court, and he cites none on appeal. For this additional reason, the trial court’s summary judgment on the constitutional claim should be affirmed. To sum up: Farkas has never identified any constitutional requirement that was allegedly violated. When, as here, the terms of the original extension of credit comply with the Constitution, there is no constitutional violation. See Sims, 440 S.W.3d at 17; Robinson, 391 S.W.3d at 595. As the trial court correctly concluded, Farkas’s “constitutional” claim fails as a matter of law. (See CR:604-05.) 23 III. The Trial Court Did Not Err in Granting Summary Judgment on Farkas’s Claim for Violations of the Texas Debt Collection Act. Farkas’s four-page issue on his Texas Debt Collection Act claim wrongly assumes that the only dispute is “over whether Wells_Bank’s actions were wrongful.” (See Br. at 24.) To the contrary, Wells Fargo moved for traditional summary judgment on two grounds: (i) the “factual allegations” on which Plaintiff bases his TDCA claim are conclusively disproven by the summary judgment evidence and, therefore, “fail as a matter of law”; and (ii) “Plaintiff’s TDCA claim is barred by the economic loss rule.” (CR:28-29.) In addition, Wells Fargo moved for no-evidence summary judgment on multiple grounds, including two that are particularly relevant on appeal: (i) “Plaintiff has no evidence that Wells Fargo threatened to take action prohibited by law”; and (ii) “Plaintiff has no evidence that the alleged violations of the TDCA caused him damages.” (CR:37-38.) Farkas attempts to show “error” by relying on conclusory assertions that Wells Fargo “threatened an act prohibited by law.” (Br. at 24.) He also contends that there is “ample evidence of the conduct actionable under [the TDCA].” (Br. at 25.) But there are multiple, fatal problems with his approach. First, when, as here, the appellant fails to negate all grounds for summary judgment, “the summary judgment must be affirmed.” Voice of the Cornerstone, 160 S.W.3d at 671. 24 Second, Rule 38.1(i) of the Texas Rules of Appellate Procedure requires an appellant’s brief to “contain a clear and concise argument for the contentions made, with appropriate citations to authorities and to the record.” TEX. R. APP. P. 38.1(i). Farkas’s “argument” on the TDCA claim contains no citations to the record – and no meaningful citations to any legal authorities.7 When, as here, a brief fails to comply with the requirements of Rule 38.1(i), a party waives the appellate points intended for the court’s consideration. Rockwall Commons Assocs., Ltd. v. MRC Mortg. Grantor Trust I, 331 S.W.3d 500, 509 (Tex. App.—El Paso 2010, no pet.). Third, Farkas’s conclusory “argument” is contradicted by the record and the law. His TDCA claim appears to be premised on the same unsupported allegations he used in trying to salvage his constitutional claim – allegations that (i) “Wells Fargo Bank, N.A.” “misrepresent[ed]” itself as “Wells Fargo Home Equity Group”; (ii) Wells Fargo “misrepresented” the amount of Farkas’s debt; and (iii) Wells Fargo “threatened non-judicial foreclosure of the property.” (See Br. at 26.) The first two allegations are contradicted by the record, which may be why Farkas omits any citations to it: 7 He does make generic references to “Tex. R. Civ. P. 166a(c)” and “TEX. FIN. CODE § 392.001, et seq.” (See Br. at 25.) 25 (i) “‘Wells Fargo Home Equity’ is a division of ‘Wells Fargo Bank, N.A.’ and is not a separate legal entity.” (CR:45; see also CR:64 (letter from “Wells Fargo Bank, N.A.; Home Equity Group”).) There is no competent evidence to the contrary. Unsupported assertions are insufficient for relief on appeal. Liberty Mut. Ins. Co. v. Griesing, 150 S.W.3d 640, 648 (Tex. App.—Austin 2004, pet. dism’d w.o.j.). (ii) The variations in “the amount of debt” reflect differences between the amounts required to cure Farkas’s default versus the amounts requires to pay off Farkas’s entire loan. (See, e.g., CR:45, 62-63, 87, 203-06.) These differing amounts also varied over time. (See id.) There is no evidence to show support Farkas’s theory that these variations somehow amount to “misrepresentations.” As explained (supra at 18-19), Texas law expressly permits a lender “who has contracted for the right of non-judicial foreclosure under a power of sale provision [to] choose to pursue the special procedure found in Rule 736 to obtain an order allowing it to proceed with a non-judicial foreclosure . . . .” See Steptoe, 2015 WL 1263128, at *3. Thus, the statement that foreclosure counsel “has been requested to pursue non-judicial foreclosure process in accordance with the terms of the Note and Deed of Trust and applicable law” (CR:87 (emphasis added)) is, as a matter of law, not a threat to do something in violation of the law. 26 Fourth, because the “threatened” foreclosure never occurred, Farkas cannot cite any evidence showing that he sustained actual damages as a result of the alleged violation, as required to recover on a TDCA claim. See TEX. FIN. CODE § 392.403(a)(2). For any or all of these reasons, the trial court’s summary judgment that Farkas take nothing on his TDCA claim should be affirmed. IV. The Trial Court Did Not Err in Granting Summary Judgment on Farkas’s Fraudulent-Lien Claim. Farkas’s final argument is largely pasted from his response to Wells Fargo’s motion for summary judgment. (Compare Br. at 29, with CR:555.) As a result, it suffers from some of the same fatal defects that plague his other arguments: it contains no citations to the record, and it contains no argument, supported by citations to legal authorities, negating all grounds for summary judgment. Those defects, alone, are enough to condemn his point. But there are additional problems, the most fundamental of which is that Farkas’s argument is premised on another false theory. In short, he assumes that any document relating to a home- equity loan (e.g., a notice of default) is a “lien” and, therefore, any alleged “misrepresentation” in the “lien” (e.g., a reference to the “wrong” loan number) makes the lien “fraudulent.” It is hardly surprising that he cites no legal authority to support this remarkable proposition. 27 Under Chapter 12 of the Texas Civil Practice and Remedies Code, a “‘[l]ien’ means a claim in property for the payment of a debt and includes a security interest.” TEX. CIV. PRAC. & REM. CODE § 12.001(d). In the mortgage context, a deed of trust is a lien; a notice that a borrower is in default is not. See Lassberg v. Barrett Daffin Frappier Turner & Engel, L.L.P., No. 4:13-CV-577, 2015 WL 123756, at *5 (E.D. Tex. Jan. 8, 2015); Jaimes v. Fed. Nat’l Mortg. Ass’n, 930 F.Supp.2d 692, 697 (W.D. Tex. 2013)); see also Jones v. JP Morgan Chase Bank, N.A., No. 4:13-CV-456, 2014 WL 2996673, at *8 (E.D. Tex. July 3, 2014) (agreeing that “the assignment, appointment of substitute trustee, and foreclosure notices are not liens, and section 12.002 is not applicable to this case.”); Perdomo v. Fed. Nat’l Mortg. Ass’n, No. 3:11-CV-734-M, 2013 WL 1123629, at *5 (N.D. Tex. Mar. 18, 2013) (collecting cases holding that an a lender’s use of an assignment, notice of foreclosure, or substitute trustee’s deed are not actionable under Chapter 12); but see Golden v. Wells Fargo Bank, N.A., 557 Fed. App’x 323, 327 (5th Cir. Feb. 20, 2014) (unpublished) (recognizing a split in authority as to “whether a document assigning a deed of trust constitutes a ‘lien or claim’ under Section 12.002,” and noting that the “majority of federal district courts have held that a document assigning a deed of trust does not qualify as a ‘lien or claim’ under Section 12.002”) (citations omitted).8 8 As this Court has recognized: “Federal authority is persuasive here because a great amount of 28 The statute further provides, in relevant part, that: 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 . . . 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 . . . financial injury . . . . Id., § 12.002(a). Without any citation to the record, Farkas accuses Wells Fargo of “shirk[ing]” its “obligation to disprove an element” of Farkas’s claim. (See Br. at 29.) But Wells Fargo’s motion set forth several reasons – all supported by citations to legal authorities – why Farkas’s fraudulent-lien claim fails as a matter of law. (See CR:30-34.) Any one of those grounds is a sufficient basis upon which to uphold the judgment. Farkas negates none, and that is fatal. See Voice of the Cornerstone, 160 S.W.3d at 671. As in the trial court, Farkas has no answer to Wells Fargo’s arguments that, as a matter of law, complaints about documents used to foreclose on a lien are not home-mortgage litigation in Texas is tried in its federal courts, applying Texas foreclosure law.” Bierwirth v. BAC Home Loans Servicing, L.P., No. 03-11-00644-CV, 2012 WL 3793190, at *1 n.3 (Tex. App.—Austin Aug. 30, 2012, pet. denied) (mem. op.). 29 actionable under Chapter 12 if the underlying note and deed of trust are valid. (See CR:555 (citing authorities).) So he attempts to divert the Court’s attention with assertions that “the statute does not require recordation of a document but rather merely making, presenting, or using the document,” and that “[e]ven a lis pendens is actionable under TEX. CIV. PRAC. & REM. CODE § 12.002.” (Br. at 29.) But those assertions are meaningless when, as here, the documents that allegedly provide the basis for a Chapter 12 claim do not falsely “evidenc[e] a valid lien or claim against real or personal property.” See TEX. CIV. PRAC. & REM. CODE § 12.002(a)(2). Because Farkas does not contest the validity of the underlying note or DOT, his Chapter 12 claim fails as a matter of law. Marsh v. JPMorgan Chase Bank, N.A., 888 F. Supp. 2d 805, 813 (W.D. Tex. 2012). Farkas also fails to negate Wells Fargo’s no-evidence grounds for summary judgment. Assertions about burden-shifting are no substitutes for evidence. And, as in the trial court, Farkas cannot cite any evidence that even remotely suggests:  “a fraudulent lien or claim [was] made, presented, or used by Defendant”;  “Defendant had knowledge that a lien or claim made, presented, or used was fraudulent”;  “Defendant made, presented, or used a fraudulent lien or claim with intent that it be given the same legal effect as a valid lien or claim”; or 30  “Defendant made, presented, or used a fraudulent lien or claim with intent to cause Plaintiff injury.” (CR:38-39.) There is no such evidence because Farkas’s fraudulent-lien claim is premised on a false theory. For any or all of the above reasons, the trial court’s summary judgment on the fraudulent-lien claim should be affirmed. PRAYER For these reasons, Appellee Wells Fargo Bank, N.A. prays that the trial court’s take-nothing judgment be affirmed in its entirety. Wells Fargo also prays for any additional relief to which it may be entitled. Respectfully submitted, LOCKE LORD LLP By: /s/ Susan A. Kidwell Susan A. Kidwell State Bar No. 24032626 skidwell@lockelord.com B. David L. Foster State Bar No. 24031555 dfoster@lockelord.com John W. Ellis State Bar No. 24078473 jellis@lockelord.com LOCKE LORD LLP 600 Congress Avenue, Suite 2200 Austin, Texas 78701 Telephone: (512) 305-4700 Facsimile: (512) 305-4800 31 Robert T. Mowrey State Bar No. 14607500 rmowrey@lockelord.com LOCKE LORD LLP 2200 Ross Avenue, Suite 2200 Dallas, Texas 75201 Telephone: (214) 740-8000 Facsimile: (214) 740-8800 COUNSEL FOR APPELLEE WELLS FARGO BANK, N.A. 32 CERTIFICATE OF COMPLIANCE I certify that the foregoing Brief of Appellee Wells Fargo Bank, N.A. contains 7, 265 words (excluding the sections excepted under Texas Rule of Appellate Procedure 9.4(i)(1)). /s/ Susan A. Kidwell Susan A. Kidwell CERTIFICATE OF SERVICE I certify that on April 20, 2015 a true and correct copy of the foregoing was served by EfileTx.gov upon the following: Mr. William D. Davis Mr. Luke Madole bdavis@capital-ip.com luke.madole@buckleymadole.com DAVIS & ASSOCIATES BUCKLEY MADOLE, P.C. P. O. Box 1093 14841 Dallas Parkway, Suite 425 Dripping Springs, Texas 78620 Dallas, Texas 75254 Counsel for Appellant Janos Counsel for Appellee Brice, Vander Farkas Linden & Wernick, P.C. (n/k/a Buckley Madole, P.C. /s/ Susan A. Kidwell Susan A. Kidwell 33 HYPERLINKED MATERIAL CAUSE NO. D-1-GN-11-003692 JANOS FARKAS, § IN THE DISTRICT COURT OF Plaintiff, § § V. § TRAVIS COUNTY, TEXAS § WELLS FARGO BANK, N.A. AND BRICE, § VANDER LINDEN & WERNICK, P.C., § Defendants. § 201 ST JUDICIAL DISTRICT DECLARATION OF MICHAEL DOLAN STATE OF CALIFORNIA § § COUNTY OF LOS ANGELES § I, Michael Dolan, hereby declare the following: 1. "I am of sound mind, over the age of twenty-one (21) years, and capable of making this Declaration. I am fully competent to testify to the matters stated herein. I have personal knowledge of each of the matters stated herein, and they are true and correct. 2. I am employed as a Research and Mediation Manager for Wells Fargo Bank, N.A. ("Wells Fargo"). I am also a custodian of the records of Wells Fargo. I have also personally reviewed Wells Fargo's records regarding the mortgage debt at issue in the above-captioned lawsuit (the "Loan"). 3. The Loan Records attached hereto are kept by Wells Fargo in the regular course of business, and it was the regular course of business of Wells Fargo for an employee or representative of Wells Fargo, with knowledge of the act, event, condition, opinion, or diagnosis recorded to make the records or to transmit information thereof to be included in such records; and the records were made at or near the time or reasonably soon thereafter. EXHIBIT DECLARATION OF MICHAEL DOLAN PAGEl OF4 AUS:0567447/00358:551946v2 1 43 4. Attached hereto and incorporated by reference, are true and correct copies of the following records. • Exhibit 1-A is a true and correct copy of the Wells Fargo Home Equity Account Agreement and Disclosure Statement executed on or about January 11, 2007 by Janos Farkas. • Exhibit 1-B is a true and correct copy of the Reinstatement Quote for the Loan at issue in this suit that is good through November 1, 2013. • Exhibit 1-C is a true and correct copy of the Payoff Statement for the Loan at issue in this suit that is good through November 1, 2013. • Exhibit 1-D is a true and correct copy of a letter dated February 7, 2011, sent to Plaintiff Janos Farkas concerning the Loan at issue in this suit. • Exhibit 1-E is a true and correct copy of relevant portions of Wells Fargo's internal loan notes concerning the Loan at issue in this dispute. 5. The attached records are the originals or exact duplicates of the originals. 6. As a Research and Mediation Manager for Wells Fargo Bank, N.A., part of my job responsibilities include researching the facts of mortgage loans associated with litigation for which Wells Fargo acts or acted as the mortgagee and/or mortgage servicer. I have gained personal knowledge of the facts stated herein through my experience in the mortgage industry, my job duties and responsibilities, my personal investigation, and my review of the Loan Records. Prior to serving as a Research and Mediation Manager for Wells Fargo, I have been employed by Wells Fargo and its predecessor institutions and held various positions, including the position of vice president in charge of portfolio retention and operations analyst. During my tenure as vice president of the portfolio and retention group, I managed a team that included all of the loan servicing functions of the company. During my 33 years of experience in the mortgage industry, including 28 years as an employee of Wells Fargo and its predecessor institutions, I have created, reviewed, and analyzed hundreds of loan records, including DECLARATION OF MICHAEL DOLAN PAGE20F4 AUS:0567447/00358:551946v2 44 amortization schedules to determine total principal and interest payments owed based on the terms of the loan. I am familiar with Wells Fargo's lending and mortgage servicing practices, including the various groups and divisions within Wells Fargo through which it carries out those practices. I am also familiar with Wells Fargo's accounting systems and methods of calculating and loan payoff and reinstatement quotes. I am familiar with Wells Fargo's record keeping system. I have had access to and reviewed various corporate and business records of Wells Fargo, and have had the opportunity to review the business records and account information related specifically to the Loan at issue in this case. All statements made herein are true and correct and based upon my personal knowledge. 7. The Loan Records reflect that Wells Fargo Bank, N.A. began acting as the Loan's mortgage servicer on or around January 11, 2007 and continues to be the mortgage servicer. 8. "Wells Fargo Home Equity" is a division of"Wells Fargo Bank, N.A." and is not a separate legal entity. Home equity loans and lines of credit were available through Wells Fargo Home Equity Group. Wells Fargo Home Equity assisted with the account management of the Loan at issue in this dispute. 9. Plaintiff has not made a payment on the Loan since August 2010. 10. The amount required to cure Plaintiffs default on the Loan as of March 22, 2011 was $2,013.30. 11. The amount required to cure Plaintiffs default on the Loan as of July 25, 2011 was $4,002.64. 12. Because of Plaintiffs default on the Loan, Wells Fargo, through its foreclosure counsel, filed an Application for Court Order Allowing Foreclosure of Lien Under Tex. Const. DECLARATION OF MICHAEL DOLAN PAGE30F4 AUS:0567447/00358:551946v2 45 WeDs fargo Banlc, N.A, AGREEMENT DATE: OI-11-2Cill7 ACCOUNT#: 650..~1998 REFERENCE##; 20063367500009 h~ t'\.j ' I.... - ptt\811' . 1 Wells Fargo Home Equity Account Agreement and Disclosure Statement (the "Agreement") lbt-__ - l THIS IS AN EXTENSION OF CREDIT AS DI!PJNED BY SECTION SO(a)(6) and (t), ARTICLE XVI OF THE TEXAS CONSTITUTION. Borrower NU~e: 1ANOS FARKAS Pnper&y Addrus: 6315 FARMDALE .LN, AUSTIN, TEXAS 78749 MaiUag Addretl for BUIIna Purposet (If different): PO BOX 180383, AUSTIN, TX 787t8 Credit Line Lfmlt1 103.441.00 SECfiON J: MY ACCOUNT AGREEM£NT !n thit Agreement, lhe words. "1,'' "me," "my," and "Borrower" (which also means "we," "us," "our," and 'Borrowers," if more than one customer signs flolow) rofet to eacb person who sipa this Aa-ment. Tho words "you," ''your," "Lender," and "the Bank" rercr to Wo1l11 Fargo Bantc. N.A. and any successor or assign or subsequent holder of this Aareemenl. This Agreement governs my Wd/& F11'1q HolM Epi(V .4cuurtt (the "Account'') with lire Bank. If moro chan OIMI person lllp1 Ibis Aafeement, we arejolatly aacl individually bound by its cenns. We ue separately llable co lhtt Bank for the entire a1D011nl owed on Cbc AAx:ount. We are each . liable as a principal and 1101 merely as a auaranror, even if one or more: ofudoea 1101 use the Aoc:ounL This Agreement is made whhout r«~ co olher asscr.s of any owoer ofdre property securing this Agreement or any owner•a spouae, unless dte owner or ownet'8 spouse oblatneclllte loan evidenced by thit Agreement by a~uaJ fraud. lfl or any person or enlily acting on my direction or will! my lcllowlcdge or oonseat commits ac1ua1 ftaud in oonneclion wllh lho loan appllcatioo procas or die documents executed In co!Diection wilb lhis A,reement, I will be lblly and personally liable under lhi& Agreement. ·· SECfiON 3: SECURITY INTEREST This Agreement is inteuded 10 evidei!Ge en "Exlension of Ctcdit" as lhat term Is defined by Section SO(al(6) and (t). Articlo XVI oftbe Texas Constihllion, and is sec:ured by a deed of trust including all modlftcacions, addellda and amendments thereto (tho "Seourity Jnmumcnt''), signed the same date as lhi.s Agreement. The Security IIJslnlment pves you a security intcmt In my homeslcad located atlhe address abown abow (the "Propmy"). SECfiON 3: MY WBLLS FARGO BOMB HIJUITY ACCOCINT My Account ls a revolving account. My credit limit fs shown above and will be displayed oo each of my billing statements. During !he Draw PCII'iod {del(;n"bcd below}, my available credf& will be my Clfoclit limit minus the sum of all W198id AdvantcS posted to my AecounL During the Draw Period. as I Rpllf the principal balance J owe on my Account, my available c:redic will be replenished. (~not to request an Advance Chllt would oause 1/15 ~entt~OI-09~7,13:44:53 50118221 47 my balance to exceed my credit limiL If at any time lhe balance ofmy Account. exceeds MY CRdit limit,! agree to immediately repay the amount lhat exceed. my credit Umil. SECTION 4: MY ACCOUNT DURING THE DRAW PERIOD DBA'Y PERIOD My Account has a Dtaw Period of 10 ytat& and one month from the date of this Agreement during which I may ~est Advance.,. At the end of tbe Dnsw Period, I may requostlhaf the Bank renew the Draw Period for an addilionalJO year& and one month. The Bank may, at lts option, approve my request ro extond the Draw Period. I may not obtain Advances after tho Draw Period ends. Whon the Draw Period ends, the OUUialldln& unpaid Una of Credit Advances will convert to a Final Fi~ted Rate Advance as detailed below in Section S, MY ACCOUNT DURING THE REPAYMI!NT PP.R.IOD. ADVANCES DQBJNG DIE DRAW PIRIOD Tbere are ltypas oC Advances on my Account: • UneofCm!itAdwnees • Fixed Rato Advances Tho Bank must llonor my request for Line of Credit Aclveccs aod FjKecJ Rate Advances (collec:tlvely, ''Advances..) • Ions as I am Ill compliance with alltenns or thi.~ Agreeruent, including all modit1c:allons, addenda and amendmentsiO 11, and the Seourity lnalnlmel\t. As I liSe my Aceo1111t, my a\llilable oredit will be rny credit limit millu the sum of all unpaid AdvanC811. As I ~ th~ principii balance J owe on my Account, my available credit will be Rplenished. I will not request an Advance 1hat would lliiUse lhe balance in ruy. Account 10 eJCoeed my credit limit, or which would violate the terms oftfds Apeen1ent or any law. If J do CKceed my credit limit, lasree to immediately repay tho amount that e~eceeda my credit limit. I understand that the Baok may refuse to allow any Advance if the Advanca does not comply with eveey requirement or thi.o: Agreement. The Bank may choose at its solo discretion to make an Advance Chat does not comply. The Bank may allow any Advances in any sequence convenient 10 the Bank. The Bank is authorized to make en Advance &om my Account when it receives a request pvoa by any person who hu signed this Asreement. If there are conflicting dcmaruls made by any ofua who signed lbi$ A.pcment, die Bank lias tho option to Rlbse to make any Advance lbal has not been reqlltMed by all of u togelber. The Bank will not be liable for any loss, expe~~R, or c:osl arising out of any telephone request, including any fi'auduleat or lllllllthorizcd telepftone te~tuest, when the Bank acts upon such matructloJIB believing tbem to be genuine. Section 50(t), Arfiele XVI or tile Texas Constitution Omits rhe maximum principal a1110unt oqtstandlog and debits and ad¥anetJ apbast tile Account aader ctrt..n tk&!UD!Stamlft. I anderstand that the Baok may rel\tse co aRow any Advantt If th• Asb'•nse dog not tSJI!PIY with §esdon 9ft), ArJislt XVI of the Texa' aymoaus I make ftom a qualified account ("Automatic Payments'? pursuant to an Authorization for Automatic Transfer will bo c:rcdllecl to my Account on the date received (inctudfna Saturdays, Sundays. and holidays). Payments 111111b at o Bank b~h and rocei"Wd prior to established cur-offtimos wiD be credited to my Account oc the busint$11 day tho paynumt'is ~by the Bank. For puxposes of chis rulo, a business day includea any day other than Saturdays, Suaclays,lllllf Ballk observed holidays. Payments made at a Banlc branch rec:dved on a Saturday, Sunday, or Bank obilltVed holiday or after estabHshed cut-orr rimes will be credited as of lho next btL'Ilness day. PaymcnfS I maJce online, by ATM, by telephone, or by any other means the Bank may make available to me an_d receiVed prior to atabllshed cut-oiT times will be credited to my ~nl on the bu6iness day the paymmt as received by th• Bank. For pvtposes of this rule, a bu$1ncas day includes any day other lban Sahlrdays, Sundays, and federal holidays. Payments made online. by ATM. by telepbOae, or by any other means Che Bank may lllaJce available to me received on a Saturday, Sunday, or fedend holiday or after eatablislted cut-ofT times Will be credited a11 of the na~t business day. I wilt not make payment or autbonze olbms to make payment for me by means of a slnaJo annspted payment. which includes paymenfS for this AIXO\IIll and any other ac:eount(s), uaJcss tho payment is made In comp1iance with the Bank's requlramCiliS for multiple account payments. The Bank may ~~ Jate payments, partial payments, post-dated Qhed44:53 I 56 If all or any pan of the Propeny or any Interest in the Property L~ sold or uansferred (or ifBonower Is not a llldural person and a benefiCial intereat In Bonower is sold or ln!Mferred) witlloutl.endcr"a prior wriUen con~en1, Lencfer may require Immediate paym~l In filii of all sums secured by this Security lll."lnlment. Howwer, this option shall not bo ex~ised by Lender If such exerc:ise is prohibited by Applicable Law. If Lender exorcises this option, Lender sball give Borrower notice or aecelenttion. The nolic:o shall provide a period of not Jess than 30 days from tbe date the notice Is given In acc:ordance wilh Section 13 within which Borrower mll$1 pay all sums .uml by this Security lnS\IIIIIIllnt lrBorrower faDs to pay these swns prior to the expiration or this period, Lender may invoke any ~medics permitted by this Security Instrument witb0111 filnher notice or demand on Borrower. SECTION 21: CHANGE IN TERMS To the extent allowed by law, I aaRC tbat the Bank may make cenain olumJCS to the temas of this Apeemont at speelfted times or vpon tho oc:cunem::e of S)leolfted events. Tha Bank may make in.,itpdftcant cbanaes, such as challgos ill tho address for payments, bllllna cycle dates, p&YmMI due dates, day of the month on which Index values an: dctonnincd, lndelt or intete$t rat~ rounding rules, and balance computation method (if the change produc~ an insisnillcant differenco in tile lntereat or FINANCE CHARGE I am required r.o pay). The Btmk may also make c:hanJO$ tllal will benefit me, such as addltl01181 opllons or a lempatary reduction in rates or fees. In aucordanoo with federal law. the Bank may also c:hiiRJO tho Index and Margin used to determine the ANNUAL PERCENTAGE RATE(S) that apr.ly to my Line of Credit Advances andfor Fixed Rate Advances if the original Index Ia no longer available. The Bank may make any of lhe chaoges discu.'llled above without my con.qont, unless applicable law provides otherwise. Tho Bank will give me any notice or clt!mae tbat is required by Jaw. I may also agree lo cbanges in wrilina. So long atlhe Property SC(;urill(l this Asrcemenl is my Texas hometlead n defmed by Chapter 41 of the Texas Propeny Code, lhe Bank may not, in any ci~umslanco. unlraterally amend the terms or this AgJeement. SECTION 12: WAIVERS· · BOBltQWQ'S WAIVERS I waive my riahttl to wquire the Bank co do certain things. Those things are: (a) to demand payment or amounls due (known as "presentment"); (b) to Jive notice lhat amounts due have not been paid (known as "notice of dishonor'')> (c) to obtain an omciaJ cmnu:atlon of nonpayment (lmown as "protesl"). lANK'S NON•WAIV£R • The Bank may fall to make use or any of ils riJhiS under this Agreement or the Securi&y Jnstnamcnt or under appllcablo law on one or more oocaslom, or dc:Jay or partially exercise such rights, wlthaut waiving any of its riJ)ds or amending any of my obligations. Tho Bank may r.n to mab use or any of iL or delay or partially exen:lso such righrs against one party, without waiving ally of its rights against any other party to this Asrecmet~~. SECTION 23: GOVERNING LAW; SEVERABILITY All interest., fees and other amounta charged or accruing in connection with this Apeement wbiob are considered "interest" wilhin tho meanina ofS~tion 8S of tho National Bank Act (12 USC §BS; 12 CFR 7.4001(a)) sball be governed by and interpreted under South Dakola law. In all other teSpects, this Agreement and all ~lated document!!, as well as the righfS, remedies, and duties of the Bank and the Borrower(s). shall be governed and interpreted by federal law 'With respect to nalionel banks and, lo the extent not preempted by federal law, the laws of the state In which the Property is located, except that Texas Finance Code Chapter 346 (which re&111ates certain revolvin& credit accounts) does not apply to thi$ Ap:emenl. • If any provision of this Agreement or the Security Jnstm~nent is detennlned to be invalid or unenforc:eablc by a coun or competent jurisdiction, che Rj$t of this Agreement will mnllin in tUU fon:e and efreet and enforceable acconling to its tc:nn!i. All menmce~~ln this Agreemllnt to lhe singular shall include 1M plurallllld vice versa. 11115 DOCUIDCIIIS 1"ru!ICS$Cd 0t.Q9•2007 t 13:44:53 57 SECTION 14: LOST OR STOLEN ADVANCE REQUEST CHECKS; BILLING ERRORS LOST OR 8J'OLEN APXANC£ REOUIST CRECQ fWUER£ AVAJyBLI): RQJ.ING IRRQRS I Will immediately contact the Bank at tha phone number oo my monthly billing lllatement 111d confinn by leiter if any or my Advance request cheeks arc ever lost or stolen, if tberc arc lillY enors in my monthlY billing statement. or iff suspect any 'IIJI8Uihotized use of my Ac:eount. The Bank will not rctum to me my canteUed Advance~~ checks or other AdVIII!ce request Jnstnunonts after ~)'iftg tham. The Ban}( wlll make available photocopies of my Advance RlqUCSl chEcks and other Advallee request msuuments upon request. I will ewnille mY AceoUIII atatemeniS promptly ift order to ldeatll)r any Improper or UllaU1horlzed entries, In coaaideralloa ror t1te Bank's pa)'IIICIIt ofeach Advance request check, I lllf" that even thouah I will110t JCCeive the original Advance Rqucst cheeks, all time periods llllder tho UnifOrm Commercial Code (UCC) for examinlna my mOIIthly billina statement and ~Jting lmpropor entries, inoludlng tbe UCC's statutes of limltalfOD with respect co fbrged, unllUihOrizecf, or missing signatures or endorsements, will begin fi'om the time my Ac:c:ount statement is first sent or made available to me. IJNAUTHQ.RIZED TRAN$ACTjON$ I will notity the Bank if someone baa b'anaferred, or may tranarcr IIIOl\e)' liom my A.ceo'lml wilbout my pennlssfon, or If I suspect any &audulent activity on my Accolml. I can call the Wells Fargo Pllont: Bank at the telephone number on my monthly blllint statement, anytime. 24 hours a day, 7 days a week. or advise my local Bank branch omce. l may al5o 5el1d written notice to the Bank at tho addrees incllcated on my billing statement. BW!nt lUgh!!- Ketp Dl1 Notlq Fqr Future UH This notice contain• lmpoJtanllnt'onnation about my rights and the Bank's responRibililies under the 'Fair Cnldlt Billing Act. Notify Tbe Bllpk In Case OfiJ'tm Or Ouutlont Abont My BID If t think my billing statement Is wrong. or if I need more illformation about a aran.•tion on my billing statement. J will &end a Iotter on a separate pqe co tho Dank, a$ soon as possible, at the acldr~ listed on my ·billing sratemmt. ·ne Bank must heat &om me nc. later tban 60 days ·after dte Balllc mn me the first billing statement on which the &II$JJec:ted error or problem appears. I can telephone the Bank, but doing liO will not preserve my rishts. In my Jetter.l will proYide the Bank wilh tbo foDowina illfbrmation: • My namo. Ac:c:ouat llllnlber and cfaylimc phone number, and • Tho dollar amount ofthe &UI~ted error, and • A closcripllon or tltc error and OJtPianaclon, If possible. as ro why 1 believe thoro is an error. If I need mont information, I will describe the Item I am not sure about. If 1 have authOrized the Bank to pay my minimum monthly payment automaticaUy ftom my ohecldng acooulll at the Bank, I ean stop the paymont of any scheduled automatic payment if I believe a biDing error has oec&~rrcd. To atop chc payment, my letter must reaoh lho Blink at tcasr tfiiH businees da,ys before tho automatic payment ia scheduled lo occur. My lU!hta ADd The Bank's ft.tHIO!l!!!!iiWU After kdol Of fdY }Yrit&p Nallu • • The Bank must acknowledge my leiter within 30 day:~, uDleas the Bank ha$ coneoted tho error by then. W.ithm 90 days. lhe Bank must either COI!Ult tho error or explain why 1M Bank believes the bmlng statement was concct. After the Bank rec:oives my letter, the Bank CIDIIOC 11y to collecl any amouat I question, or report me as delinquent. Tho Bank Gan continue to biD me for tho amount I queetlon. includina financ:e chmgcs, and the Bank can apply anY Wlp&id amoun1 against my credit limit. I 4o not llave to pay IUIY qucstaoned QIUO\Ull while the Bank Is researching my Ac:c:ount, but J am still obligated to pay tho parts of my bill thai are not in question. ll/15 Doc:umenrs Pmc:essod 01.()9.2:007, 13:44:53 I 58 lt the Bank fmds that a mistake was made on my billing stalelllent, I will not have to pay any ftnanee charges related to lhe questioned amount. lflhe Bank didn't mako a mistake, I will have to pay finaMC charges. and 1 will have lo make up any missed payaJcn~s on lhe questlomd amount. In eilller case, the Bank will send me a $tatemtlllt of the amom~t I owe and the dalO chat payment is due. If 1 filii to pay the amount that the Bank dotennines I owe, the Bank may report me as delinquent. However, if the Bank's explanation docs not satiJfy me and I write to the Bank within ten daya tellina tbe Bank that l still refuse to pay, the Bank muat ten anyone the Bank repons me to lhatl have a quesclon about my biD. And. the Bank must tell me the name or anyona the Bank APOI1S me to. When the matter has been souled between the Bank and me, •II• Bank mllll tell anyone the Bank repc11ts mo to that tile matter has been setllcd. If die Bank does not follow the above rules, the Bank c:annot collect the fltst $50 of the questioned amoum, even it my billina statement waa corrc:c:c. SECTION 25: NOTICES Unless appllaabla law requires a ditTercnt method, any notice that must be pven to me or to anyone el$e who sips,a.mranteea or endoi'SOfllhis Aareement may be glwn by 11111ilina it to my addres& as aet forth abo-ve in Ibis Ap:emont, or to a different address If I have properly notified the Balik of tbat different adns. Any notice that I may send to the Bank must be afven by maill.q it to the Bank 111 lhe address provided on my billing statement, unless the aype of notice ls more specifically addreued in this Asreoment alld a different address is provided herein. If I contact YOII by phone. I acknowledge that telephone calls between me and the Bank or any of the Bank's amliaces may be monitored and recorded by the Bank or the Bank•s affiliaccs to ensure that my inquiries aro bandied prompdy, COIIrtiiOUSiy and ac DATESlGNED 'f. JANOS F'ARKAS (Set\) BORROWER DATE SIGNED BORROWER DATE SIGNED BORR.OWER DATE SIGNED •••••• 14/lS WeJI5FarpHo-~~= Acc:ount Aa-t Oocullltll1$1'roc the work is completed. Unless an agreement is made in writing or Applicable Law requires interest to be paid on such Miscellaneous Proceeds, Lender shall not be required to pay Borrower at1y interest or earnings on such MisceUaneous Proceeds. Subject to the rights of any lienholder with rights to Miscellaneous Proceeds that are superior to Lender's rights, if the restoration or repair is not economical1y feasible or Lender's security would be lessened, the Miscellaneous Proceeds shall be applied to the sums secured by this Security Instrument, whether or not then due, with the excess, if any, paid to Borrower. Such Misccllaneou~ Proceeds shall be applied in the order provided for in Section 2. Subject to the rights of any lienholder with rights to Miscellaneous Proceeds that are superior to Lender's rights, in the event of a total taking, destmction, or loss in value of the Property, the Miscellaneous Proceeds shall be applied to the sums secured by this Security Instrument, whether or not then due, wi1h the excess, if any, paid to Borrower. TEXAS-OPEN-END SECURITY INSTRUMENT (paft• 5 nf'/ 4 pages) HOII62v7 (2/3105) IIIIIIIIIRIJIIIIIIIIIIIIIIII Documen;s Processed 01-09-2007, 13:44:53 74 In the event of a partial taking, destruction. or loss in value of the Property ir. which the fair market value of the Property immediately before the partial taking, destruction, or loss in value is equal to or greater than the amount of the sums secured by this Security Instrument immediately before the panial taking, destruction, or toss in value, unless Borrower and Lender otherwise agree in writing, the swns securt:d by this Security Instrument shall be reduced by the amount of the Miscellaneous Proceeds multiplied by the following fraction: (a) the total amount of the sums secured immediately before the partial taking, destruction, or loss in value divided by (b) tbe fair market value of the Property immediately before the partial taking, destruction, or loss in value. Subject to the rights of any lienholder with rights to Miscellaneous Proceeds that are superior to Lender's rights, any balance shall be paid to Borrower. In the event of a partial taking, destruction, or loss in value of the Property in which the fair market value of the Property immediately before the partial taking, destruction, or loss in value is less than the amount of the sums secured immediately before the partial taking, destruction, or loss in value, unless Borrower and Lender otherwise agree in writing, the Miscellaneous Proceeds shall be applied to the sums secured by this Security Instrument whether or not the sum.'l are then due, subject to the rights of any lienholder with rights to Miscellaneous Proceeds that are superior ro Lender's rights. If the Property is abandoned by Borrower, or if, after notice by Lender to Borrower that the Opposing Party (as defined in the next sentence) offers to make an award to settle a claim for damages, Borrower fails to respond to Lender within 30 days after the date the notice is given, Lender is authorized to collect and apply the Miscellaneous Proceeds either to restoration or repair of the Property or to the sums secured by this Security Instrument, whether or not then due, subject to the rights of any lienholder with rights to Miscellaneous Proceeds that are superior to Lender's rights. "Opposing Party"' means the third party that owes Borrower Miscellaneous Proceeds or the party against whom Borrower has a right of action in regard to Miscellaneous Proceeds. Borrower shall be in default if any action or proceeding, whether civil or criminal, is begun that, in Lender's judgment, could result in forfeiture of the Property or other material impairment of Lender's interest in the Property or rights under this Security Instrument. Borrower can cure such a default by causing the action or proceeding to be dismissed with a ruling that, in Lender'!! judgment, precludes forfeiture ofthe Property or other material impainnent of Lender's interest in the Property or rights under this Security Imtrwnent. The proceeds of any award or claim for damages that are attributable to lhe impairment of Lender's interest in the Property are hereby assigned and shall be paid to Lender. All Miscellaneous Proceeds that are not applied to restoration or repair of the Property shall be applied in the order provided for in Section 2, subject to the right'! of any lienholder with rights to Miscellaneous Proceeds that are superior to Lender's rights. 10. Borrower Not Released; Forbearance By Lender Not a Waiver. Extension of the time for payment or modification of amortization of the sums secured by this Security Instrument granted by Lender to Borrower or any Successor in Interest of Borrower shall not operate to release the liability of Borrower or any Successors in Interest of Borrower. Lender shaH not be required to conunence proceedings against any Successor in Interest of Borrower or to refhse to extend time for payment or otherwise modify amortization of the sums secured by this Security Instrument by reason of any demand made by the original Borrower or any Successors in Interest of Borro~r. Any forbearance by Lender in exercising any right or remedy including, without limitation, I .ender's acceptance of payments from third person~. entities or Successors in Interest of Borrower or in amounts less than the amount then due, shall not be a waiver of ~r preclude the exercise of any right or remedy. 11. Joint and Several Liability; Co-trustors; Successors and Assigns Bound. llorrower covenants and agrees that Borrower's obligations and liability shall be joint and several, however, for any extension of credit subject to Tex. Canst. Art. XVI § 50(a)(6), no O\\'IIer of the Property or spouse of the owner of the Property will be held personally liable for the amount due under the Deht Instrument, unle~s the owner or the spouse of the owner obtained the extension of credit under the Debt Instrument by actual fraud. Any Borrower who signs this Security Instrument but does not execute the Debt Instrument (a "co-trustor''): (a} is signing this Security Instrument only to mortgage, grant and convey the co--trustor's interest in the Property under the terms of this Security Instrument; (b) is not personally ob1igated to pay the sums secured by this Security Instrument; and {c) agrees that Lender and nny other Borrower can agree to extend, modifY, forbear or make any accommodations with regard to the terms of this Security Instrument or the Debt Instrument without the co-trustor's consent. Borrower's obligations are not assumable. The covenants and agreements of this Security Instrument shall bind (except as provided in Section 17) and benefit the successors and assigns of Lender. TEXAS-OPEN-END SECURITY INSTRUMENT (page ~ of/4 pages} 1inliilllil•••,••••••••••~• 6 Documerns Processed 01-09-2007. 13:44:53 75 12. Loan Charges. Lender may charge Borrower fees for services perfonned in connection with Borrower's default, for the purpose of protecting Lender's interest in the Property and rights under this Security Instrument. including, but not limited to. auomeys· fees. property inspection and valuation fees. In regard to any other fees, the absence of express authority in this Security Instrument to charge a specific fee to Borrower shall not be construed as a prohibition. on the charging of such fee. Lender may not charge fees that arc expressly prohibited by this Security Instrument or by Applicable Law. If the Extension of Credit is subject to a law which sets maximum Joan charges, and that law is finally interpreted so that the interest or other loan charges collected or to be collected in connection with the Extension of Credit exceed the permitted limits. then: (a) any such loan charge shall be reduced by the amount necessary to reduce the charge to the pem1ilted limit; and (b) any sums already collected from Borrower which exceeded permitted limits will be refunded to Borrower. Lender may choose to make this refund by reducing the principal owed under the Debe Instrument or by making a direct payment to Borrower. lf a refund reduces principa1, the reduction will be treated as a partial prepayment without any prepayment charge (whether or not a prepayment charge is provided for under the Deht Instrument). Borrower's acceptance of any such refund made by direct payment to l:lormwer will constitute a waiver of any right of action Borrower might have arising out of such overcharge. 13. Noti£es. Unless otherwise described in the Debt Instrument or in another agreement between Borrower and Lender, the following provisions regar!ling notices shall apply. All notices given by Borrower or Lender in connection with this Security Instrument must be in writing. Any notice to Borrower in connection with this Security Instrument shall be deemed to have been given to Borrower when mailed by first class mail or when actually delivered to Borrower's notice address if sent by other means. Notice to any one Borrower shall constitute notice to all BorroweiS unless Applicable Law expressly requires otherwise. The notice address shall be the PropeJ1y Address unless Borrower has designated a substitute notice address by notice to Lender. Borrower shall promptly notify Lender of Borrower's change of address. If ~nder ~pecifies a procedure for reporting Borrower's change of address, then Borrower shall only report a change of address through that specified procedure. There may be only one designated notice address for Borrower under the Extension of Credit at any one time. Any notice to Lender shall be given by delivering it or by mailing it by first class mail to Lender's address stated herein un1ess Lender has designated another address by notice to Borrower. Any notice in connection with this Security In.-.trument shall not be deemed to have been given to Lender lllltil actuaUy received by Lender. If any notice required by this Security Instrument is also required under Applicable Law, the Applicable Law requirement will satisfy the corresponding requirement wtder this Security Instrument. 14. Governing Law; Severability; Rules of Construction. This Security Instrument shall be governed by federal law and, to the extent not preempted by federal law, the law of the jurisdiction in which the Property is located. Ali rights and obligations contained in this Security Instrument are subject to any requirements and limitations of Applicable Law. Applicable Law might ex.plicitly or implicitly allow th~: parti~::s to agree by contract or it might be silent, but such silence shall not be construed as a prohibition against agreement by contract. In the event that any provision or clause of this Security Instrument or the Debt Instrument conflicts with Applicable Law, such conflict shall not affect other provisions of this Security Instrument or the Debt Instrument which can be given effect without the cont1icting provision_ As used in this Security Instrument: (a) words of the masculine gender shall mean and include corresponding neutt:r words or words of the feminine gender; (b) words in the singular shall mean and include the plural and vice versa; (c) the word "may" gives sole discretion without any obligation to take any a~tion; and (d) headings that appear at the beginning of the sections of this Security Instrument are inserted for the convenience of the reader only, shall not be deemed to be a part of this Security Instrument. and shall not limit, extend, or delineate the scope or provisions of this Security Instrument. 15. Borrower's Copy. Borro~ shall be given one copy of the Debt Instrument and of this Security Instrument. Hi. Transfer of the Property or a Bencficiallntere!lt in Borrower. As used in this Section 16, ..Interest in the Property" means any legal or beneficial interest in the Property, including, but not limited to. those beneficial interests transferred in a bond for deed, contract for deed, installment sales contract or escrow agreement, the intent of which is the transfer of title by Borrower at a future date to a purchaser. If all or any part of the Property or any Interest in the Property is sold or transferred (or if Borrower is not a natura! person and a beneficial interest in Borrower is sold or transferred) without Lender's prior written consent. Lender may require immediate payment in full of all swns secured by this Security Instrument However, this option shall not be exercised by Lender if such exercise is prohibited by Applicable Law. Tt.:XAS-OPF-1\-END Si:CURITY lNSTRUMENT (page 7 af'! 4 P"~es) IIC:i1162v7 (2/3105) 1111111111111111111111111111 Documc111s Pmcessed 01-()'l·2007. 13.4453 76 If Lender exercises this option, Lender shall give Borrower notice of acceleration. The notice shall provide a period of not less than 30 days from the date the notice is given in accordance with Section I 3 within which Borrower must pay all sums secured by this Security Instrument. If Borrower fails to pay these sums prior to the expiracion of this period, Lender may invoke any remedies permitted by this Security Instrument without further notice or demand on Borrower. 17. Sale of Debt Instrument; Change of Loan Servicer; Notice of Grievance. The Debt Instrument or a partial interest in the Debt Instrument {together with this Security Instrument) can be sold one or mme times without prior notice to Borrower. A sale might result in a change in the entity (known as the "Loan Servicer") that collects Periodic Payments due under the Debt Instrument and this Security Instrument and performs other mortgage loan servicing obligationJ; under the Debt Instrument, this Se~:urity Instroment, and Applicable Law. There also might be one or more changes of the Loan Servicer unrelated to a sale of the Debt Instrument. If there is a change of the Loan Servicer, Borrower will be given written notice of the change as required by Applicable Law. If the Debt Instrument is sold and thereafter the Extension of Credit is serviced by a Loan Servicer other than the purchaser of the Debt Instrument, the mortgage loan servicing obligations to Borrower will remain with the Loan Servicer or be transferred to a successor Loan Servicer and are not assumed by the purchaser of the Debt Instrument unless otherwise provided by the purchaser of the Debt Instrument. Nt:ither Borrower nor Lender may commence, join, or be joined to any judicial action (as either an individual litigant or the member of a class) that arises from the other party's actions pursuant to this Security Instrument or that. alleges that the other party has breached any provision of, or any duty owed by reason of, this Security Instrument, until such Borrower or Lender has notified the other party (with such notice given in compliance with the requirements of Section 13) of such alleged breach and afforded the other party hereto a reasonable period after the giving of such notice to take corrective action. If Applicable Law provides a time period that must elapse before certain action can be taken, that time period will be deemed to be reasonable for purposes of this paragraph. The notice of acceleration and opportunity to cure given to Borrower pursuant to Section 21 and the notice of acceleration given to Borrower pursuant to Section 16 shall be deemed to satisfy the notice and opportunity to take corrective action provisions of this Section 17. If Borrower and Lender have entered into an agreement to arbitrate disputes, the provisions of any such arbitration agreement shall supersede any provision in this Section 17 that would conflict with the arbitration agreement. 18. Hazardous Substances. As used in this Section 18: (a) "Hazardous Substances" are those substances defined as toxic or hazardous substances, pollutants, or wastes by Environmental Law and the following subst11nces: gasoline, kerosene, other flanunable or toxic petroleum products, toxic pesticides and hel'bicides, volatile solvents, materials containing asbestos or formaldehyde, mold, and radioactive materials; (h) ..Environmental Law" means federal laws and laws of the jurisdiction where the Property is located that relate to health, safety or environmental protection; (c) "Environmental Cleanup" includes any response action, remedial action, or removal action, as defmed in Envkoruncntal Law; and (d) an ••Environmental Condition" means a condition that can cause, contJ-ibute to, or otherwise trigger an Environmental Cleanup. Borrower shall not cause or permit the presence, use, disposal, storage, or release of any Hazardous Substances, or threaten to release any Hazardous Substances, on or in the Property_ Borrower shaU not do, nor allow anyone else to do, anything affecting the Property (a) that is in violation of any Environmental Law, (b) which create:. an Enviromnental Condition, or (c) whicb, due to the presence, use, or release of a Hazardous Substance, creates a condition that adversely affects the value of the Property. The preceding two sentences shall not apply to the presence, use, or storage on the Property of small quantities of Hazardous Substances that are generally recognized to be approprjate to normal residential uses and to maintenance of the Property (including, but not limited to, hazardous substances in consumer products}. Borrower shall promptly give Lender written notice of(a) any investiga!ion, claim, demand, lawsuit or other action by any governmental or regulatory agency or private party involving the Property and any Hazardous Substance or Environmental Law of which Borrower has actual knowledge, (b) any Envirorunentat Condition, including but not limited to, any spilling, leaking, discharge, release or threat of release of any Hazardous Substance, and (c) any condition caused by the presence. use or release of a Hazardous Substance which adversely affects the value of the Property. If Borrower learns, or is notified by any governmental or regulatory authority, or any private pany. that any removal or other remediarion of any Hazardous Substance affecting the Property is necessary, Borrower shall promptly take all necessary remedial actions in accordance with Environmental Law. Nothing herein shall create any ubligation on Lender for an Environmental Cleanup. TEX:A.S-OPEN-ENil SECURITY INSTRUMENT (page !I of 14 P"lt~~J HC# 162v7 (2/3/0j) 11111111111111111111111111111 Dotumenls pl'(,cc:ssed 01-09-2007, 13:44..53 77 19. Condominiums; Planned Unit Developments. Solely 10 the extent permitted by§ 50(a)(6)(H), Anicle XVI of the Texas Constitulion, the Property shall include the types of properLy described in this Section 19. If the Property is a unit in a condominium project ("Condominium Project"} or is part of a planned unit development {"PUD"), Borrower agrees to the following: A. Obligations. Borrower shall perfonn all of Borrower's obligation.. _.rt.'-~· subjecting Borrower;s other assets to satisfaction of the debt. i ((~ -i·~~ r;;:!,i ~~~~· ~\ If not prohibited by Section SO(a)(6)(C), Article XVI of the Texas Constitution, this Section 23 shall not impair in any way the lien of this Security Instrument or the right of lender to collect all sums due under the Debt ..::.:1~ g~ ·~~....... Instrument and this Security Instrunlent or prejudice the right of Lender as to any covenants or conditions of the Debt Instrument and this Security Instrument. 24. Substitute Trustee; Trustee Liability. All rights, remedies and duties of Trustee under this Security Instrument may be exercised or perfonned by one or more trustees acting alone or together. Lender, at its option and with or without cause, may from time to time, by power of attorney or otherwise, remove or substitute any trustee, ' add one or more trustees, or appoirlt a successor trustee to any Trustee without. the necessity of any fonnality other than a designation by lender in "'Titing. Without any further act or conveyance of the Property the substitute, additional or successor trustee shall become vested with the title, righls, remedies, powers and duties conferred upon Trustee herein and by Applicable Law. Trustee shall not be liable if acting upon any notice, request, consent, demand, statement or other document believed by Trustee to be correct. Trustee shall not be liable for any act or omission unless such act or omission is willful. 25. Provisions Related to Section SO(a)(6) and Section SU(t), Article XVI of the Texas Constitution (a) Proceeds. Borrower has not been required to apply the proceeds of the Extension of Credit to repay another debt except a debt secured by the Property or debt to another lender. (b) No Assignment of Wages. Borrower has not assigned wdges as security for lhe E~ tension of Credit. (c) Acknowledgment of Fair Market Value. Lender and Borrower have executed a written acknowledgment as to the fair market value of Borrower's Property on the date the Extension of Credit is made. (d) Acknowledgment of Waiver by Lender of Additional Collateral. Borrower acknowledges that Lender waives all tenns in any of Lender's loan documentation (whether existing now or created in the future) which (a) create cross default; (b) provide for additional collateral; and'or (c) create personal liability for any Borrower (except in the event of actual fraud), for the Extension of Credit. This waiver includes, but is not limited to, any (a) guaranty; (b) cross collateralization; (c) future indebtedness; (d) cross default; and/or (e) dragnet provisions 1n any loan documentation with Lender. BY SIGNING HELOW, Borrower accepts and agrees to the terms and covenants contained in this Security Instrument and in any Rider executed by Borrower and recorded with it. DO NOT SIGN IF THERE ARE BLANKS LEFT TO BE COMPLETED IN THIS DOCUMENT. THIS DOCUMENT MUST BE EXECUTED AT THE OFFICE OF LENDER, AN ATTORNEY AT LAW OR A TITLE COMPANY. YOU MUST RECEIVE A COPY OF THIS DOCUMENT AFTER YOI: HAVE SIGNED IT. YOU MAY, WITHIN 3 DAYS AFTER CLOSING, RESCIND THIS EXTENSION OF CREDIT WITHOUT PENALTY OR CHARGE. TEXAS-OPEN-END SECURITY INSTRUMENT (po.ge II (}{ 14 pageJJ ilillilillllllllllllllllllll Docum~nls Processed 0 ~·09·2007, 13:44:53 80 ·- ·t ~~ ~ _J_i-''l-S-(F_-~AR-~KAS-~-~--~--=~~-.---(Seal) AND - Borrower Printed Name:. __ ':C....::...::c~~~Y.~a'"'.:::..\...-=:,__--'!.~_;C(~v~·..;.;k=.~~~­ [Please Complele] _________________ (Seal) -Borrower Printed Name: [Plea.l'e Complete] _ _ _ _ _ _ _ _ _ _ _ _ _ (Seal) -Borrower Printed Name: _ _ _ _ _ _ _ _ _ _ _ _ _ __ [P/e(lSe Complete] _ _ _ _ _ _ _ _ (Seal) -Borrower Printed Name: _ _ _ _ _ _ _ _ _ _ _ _ __ [Please Complete) -~-----------(Seal) -Borrower Printed Name:._ _ _ _ _ _ _ _ _ _ _ _ _ __ {Please Complete] _ _ _ _ _ _ _ _ _ _ _ _ _ (Seal) -Borrower Printed Name: [Please Complete] TEXAS-O.I'EN-END SECURITY INSTRUMENT fpage 12 r.f 14 pages) HC#I62v7 (21.3/05) 1111111111111111110111111111 Documents Processed 0 1-09-2007, 13:44:53 81 Brice. Vander Linden & Wernick, P.C Aitomeys 11nd CtMJnseJon LEGAL I'RECF.DENT IS NOT Cl.ED AS :ro Wll1!.7'HER THE SENDING OF THIS l.ET1'6lt MAKES lm A DEBT COJ.LEC'ItJR. 1'0 THE J!X1StiT JT DOE$, WE AilE PL&fSED 10 AIJnsE 'fOll rHAT TH1&' IS AN ATTEMPT TO COLLECTA DEBT. ANDANYJNIIOBMAf'ION OIT.MNED W.U.L BE IJSED FOR THAT PIJRJIO.fE. HO.Jf'EJI'BJt, IF YOV ARE IN lUNKRVPTCY Oll HAn£ BEBN liiSCJIAR.CEJ) IN .84NKRlii'R:Y. TRIG LE1'7ER 13 FOit INRJAMATIONJIL l'Ul!Pl$ of !lie 'Note and t)e!ed or'l'nllt, ad plll~l'lllo lhe pnwl~o~ofllte Taxa• P~ Code. S«tlon !1.002, 1~ fbllowins 111>tiU$ ansproY!d~ 1o ,101t I. Tho IO&YI$ inddbult tJr&ihms ID mdce1ht NqpOior n\11mllly )l~Jeqllirl!d by 1M Noll: and Delld ofTna 2. The aetion IY!quircd 1o cure 1M de6uk isiZ.~ of'all SIIIN d~~& alldertllo Noll: lll'od DeedOfTP!$1:. J. I(~ dc!hlllt i~ IICl wed by:lllcllpl.)lllllolllwitltinllllrty l30)dll)" oflllt cbtcoflbis notice, \viiiiOIIIIIuthernolico or demaniS. the nullurily dateof'lbll Ntlle\\'111 bucce{orwcl 111111 allauns ~~eetnd by the Doed of'Trusl ~lfbll declared m N.lmmedi#lely due- and payablt. Tlw~u, U b i"tendld lhatll>epmpettybe ~d by ltSubsliN!e Trusleo eu public iorealo.moolltll~. 4. Alletii.C«dle de!IIPlr·an~dJyyoudoODio IOptll 111111 bcp:mr. lien~», i1)V8payi~MUIPI1\Iib0Wil~ an &djtlslmenl may be nt:Ce$111IY aftet yo11r e!lodc il ~ved ill ...ticb euem we ll'ill intonn you befbre tile cl1eck is cl~ for collec&n. 'I'or ftl11flef illf'N>N~oliol!, ..nit us It 8ri'e~~, Vandet Lilldeft 1r. Wbrinsa ist ar . 2. tr.,sal preoeden! is I10t dear as·IO ~ile!hcr 11\e setxling 111illcllcc-l1llllleS 1l$ 8 debt (O!)r:o:~c~r. To llle ~IC!II ildoos. \W: 8/Y! pleastcl 10 advise you lha!llli$1e\ter ~antl!et'llpl10 c;ollocl o. debt and any illfonnnliM obl1ll'ltll win b1: IHCd 1brlbat pllfll0$C.. J. Yll~tllre Cl1cour:~g.~ 10 .send 10 us~ inlllnnatio11 you have that SU&g851$1119t the lo~m is 1'01 in defAillc cr th:~r the tl'l'IOll111 of dcl'aulr is diffi!tenl liom Ill( l1111(Jlln1 lndicabi i1t this ltller. Upcm meiJ)t ofstldt iPfll!mlion, WI: will be pJI!aselJ 10 fo!Vo'iUd the-inlbi'WUlliOA to the lender tor""~"' Sind Mill.-~. B~. Vlllldcr Linden 11 Wem~, P..C. EXHIBIT 3-Pr 87 Brice. Vander Linden & Wernick, P.C. Attorneys and Counselors 9441 LBJ Freeway, Suite 250 Dallas, Texas 75243 Office (972) 643-6600 May24,20II LEGAL PRECEDENT IS NOT CLEAR AS TO WHETHER THE SENDING OF THIS LETTER MAKES US A DEBT COLLECTOR. TO THE EXTENT IT DOES, WE ARE PLEASED TO ADVISE YOU THAT TmS IS AN ATTEMPT TO COLLECT A DEBT, AND ANY INFORMATION OBTAINED WILL BE USED FOR THAT PURPOSE. HOWEVER, IF YOU ARE IN BANKRUPTCY OR HAVE BEEN DISCHARGED IN BANKRUPTCY, THIS LETTER IS PROVIDED FOR INFORMATIONAL PURPOSES ONLY AND IS NOT INTENDED AS AN ATTEMPT TO COLLECT A DEBT OR AS AN ACT TO COLLECT, ASSESS, OR RECOVER ALL OR ANY PORTION OF THE DEBT FROM YOU PERSONALLY. JANOS FARKAS 9600 ESCARPMENT BLVD STE 745-4 AUSTIN, TX 78749-I982 Re: 63I5 FARMDALE LN, AUSTIN, TX 78749 Loan No. 09996I706I Our File No. 9508-0790 Our Case No. VS-09996I7061-FC DEFAULT CURE INQUIRY RESPONSE In response to your recent inquiry, we are pleased to provide the attached default cure information from your lender. We encourage you to read it carefully. The following brief summary is provided as an aid but not an alternative to your reading of the attached. Default Cure Amount: $19,604.23 Good Through Date: 06/20/20 I I Receipt Deadline: 10:00 A.M. (Central) on II/OI/20II, or the good through date above, whichever is earlier. Certified Funds Payable To: Wells Fargo Home Equity Deliver Payment To: A TrN: FRCL Inquiry Unit Brice, Vander Linden & Wernick, P.C. 9441 LBJ Freeway. Suite 250 Dallas, Texas 75243 Foreclosure processing will continue and will not be stopped unless the default cure amount is received in our office before the receipt deadline. If the default cure amount is not received by the receipt deadline and the good through date expires before the scheduled sale date, you must submit a request for an updated default cure amount. The default cure amount reported in the attached may not include amounts incurred or accrued but not currently appearing in your lender's records. Your timely tendering of the default cure amount will stop the current foreclosure processing; however, you will have to arrange for the timely payment of any additional amounts incurred or accrued or your loan may be returned to foreclosure processing. The foreclosure fees and costs reported in the attached may include both fees and costs already incurred and fees and costs projected to be incurred on/or before the good through date. Upon receipt of your timely payment, we will determine the actual fees and costs due to us at that time, invoice that amount to our client, and report the difference, if any, to your lender for further handling. Should you have any questions concerning the attached information, please do not hesitate to contact us at 972/643-6600. Very truly yours, Brice, Vander Linden & Wernick, P.C. Selim Taherzadeh Attachment 203 File: 9508-0790 Brice, Vander Linden & Wernick, P.C. Attorneys and Counselors 9441 LBJ Freeway, Suite 250 Dallas, Texas 75243 Office (972) 643-6600 May 24,2011 LEGAL PRECEDENT IS NOT CLEAR AS TO WHETHER THE SENDING OF THIS LETTER MAKES US A DEBT COLLECTOR. TO THE EXTENT IT DOES9 WE ARE PLEASED TO ADVISE YOU THAT THIS IS AN ATTEMPT TO COLLECT A DEBT9 AND ANY INFORMATION OBTAINED WILL BE USED FOR THAT PURPOSE. HOWEVE~ IF YOU ARE IN BANKRUPTCY OR HAVE BEEN DISCHARGED IN BANKRUPTCY9 THIS LETTER IS PROVIDED FOR INFORMATIONAL PURPOSES ONLY AND IS NOT INTENDED AS AN ATTEMPT TO COLLECT A DEBT OR AS AN ACT TO COLLECT9 ASSESS 9 OR RECOVER ALL OR ANY PORTION OF THE DEBT FROM YOU PERSONALLY. JANOS FARKAS 9600 ESCARPMENT BLVD STE 745-4 AUSTIN, TX 78749-1982 Re: 6315 FARMDALE LN, AUSTIN, TX 78749 Loan No.: 0999617061 Our File No.: 9508-0790 Our Case No.: VS-0999617061-FC LOAN PAYOFF INQUIRY RESPONSE In response to your recent inquiry, we are pleased to provide the attached payoff information from your lender. We encourage you to read it carefully. The following brief summary is provided as an aid but not an alternative to your reading of the attached. Payoff Amount: $123,127.31 Good Through Date: 06/20/2011 Receipt Deadline: 10:00 A.M. (Central) on 11/01/2011, or the good through date above, whichever is earlier. Certified Funds Payable To: Wells Fargo Home Equity Deliver Payment To: A1TN: FRCL Inquiry Unit Brice, Vander Linden & Wernick, P.C. 9441 LBJ Freeway, Suite 250 Dallas, Texas 75243 Foreclosure processing will continue and will not be stopped unless the payoff amount is received in our office before the receipt deadline. If the payoff amount is not received by the receipt deadline and the good through date expires before the scheduled sale date, you must submit a request for an updated payoff amount. The payoff amount reported in the attached may not include amounts incurred or accrued but not currently appearing in your lender's records. Your timely tendering of the payoff amount will stop the current foreclosure processing; however, you will have to arrange for the timely payment of any additional amounts incurred or accrued or your loan may be returned to foreclosure processing. The foreclosure fees and costs reported in the attached may include both fees and costs already incurred and fees and costs projected to be incurred on/or before the good through date. Upon receipt of your timely payment, we will determine the actual fees and costs due to us at that time, invoice that amount to our client, and report the difference, if any, to your lender for further handling. Should you have any questions concerning the attached information, please do not hesitate to contact us at 972/643-6600. Very truly yours, Brice, Vander Linden & Wernick, P.C. Selim Taherzadeh Attachment 204 PAYOFF INQUIRY RESPONSE File: 9508-0790 DC BK14295 PG59 CAUSE NO. D-1-GN-11-003692 JANOS FARKAS, § IN THE DISTRICT COURT OF Plaintiff, § § v. § § TRAVIS COUNTY, TEXAS WELLS FARGO BANK, N.A. AND BRICE, § VANDER LINDEN & WERNICK, P.C., § n/k/a BUCKLEY MADOLE, P.C. § Defendants. § 201ST ruDICIAL DISTRICT FINAL ORDER AND JUDGMENT On this day, the Court considered the First Amended Traditional and No-Evidence Motion for Summary Judgment and Motion to Sever ("Wells Fargo's Motion") filed by Defendant Wells Fargo Bank, N.A.; the Motion for Partial Summary Judgment ("Plaintiffs Motion") filed by Plaintiff Janos Farkas; Plaintiffs Objections and Motion to Strike and Exclude the Summary Judgment Evidence of Defendant Wells Fargo Bank, N.A. (the ("Objections"); and Defendant Brice, Vander Linden & Wernick, P.C. 's Traditional and No-Evidence Motion for Summary Judgment ("Brice's Motion"). After careful consideration of Wells Fargo's Motion, Plaintiffs Motion, the Objections, and Brice's Motion, any timely responses thereto, the competent evidence, all pleadings properly before the Court, the arguments of counsel, and all other matters properly before the Court, the Court rules as follows: Wells Fargo's First Amended Traditional and No-Evidence Motion for Summary Judgment is GRANTED and Plaintiff Janos Farkas shall take nothing by his claims against Defendant Wells Fargo Bank, N.A. Plaintiffs Motion for Partial Summary Judgment is hereby DENIED. Plaintiffs Objections are hereby OVERRULED and Plaintiffs motion to strike and exclude Defendant Wells Fargo Bank, N.A. 's summary judgment evidence is hereby DENIED. ORDER PAGE 1 OF 2 AUS:056744 7/003 58 :551442v3 604 DC BK14295 PG60 Defendant Brice, Vander Linden & Wernick, P.C.'s Traditional and No-Evidence Motion for Summary Judgment is GRANTED and Plaintiff Janos Farkas shall take nothing by his claims against Defendant Brice, Vander Linden & Wernick, P.C. Defendant Wells Fargo Bank, N.A.'s Motion to Sever is DENIED as moot. This judgment finally disposes of all claims by Plaintiff and is appealable. n -(~ '? SIGNED this the J day of October, 2014. ) THE HONORA E LORA IVINGSTON TRAVIS COUNTY DISTRICT JUDGE AGREED AS TO FORM: William D. Davis Sammy Hooda DAVIS & ASSOCIATES Michael Bums P.O. Box 1093 BUCKLEY MADOLE, P.C. Dripping Springs, Texas 78620 9441 LBJ Freeway, Suite 250 Attorneys for Plaintiff Dallas, Texas 75243 Attorneys for Brice, Vander Linden & Wernick, P.C. nlkla Buckley Madole, P.C. B. David L. Foster John W. Ellis LOCKE LORD LLP 600 Congress Ave., Suite 2200 Austin, Texas 78701 Attorneys for Wells Fargo Bank, N.A. ORDER PAGE20F2 AUS:0567447/00358:551442v3 605 Page 1 440 S.W.3d 10, 57 Tex. Sup. Ct. J. 588 (Cite as: 440 S.W.3d 10) 266 Mortgages 266VII Payment or Performance of Condition, Re- Supreme Court of Texas. lease, and Satisfaction Frankie SIMS, on Behalf of Himself and all Others 266k306 k. Change in time or mode of payment. Similarly Situated; and Patsy Sims, on Behalf of Herself Most Cited Cases and all Others Similarly Situated, Appellants, The restructuring of a home equity loan that in- v. volved capitalization of past-due amounts owed under CARRINGTON MORTGAGE SERVICES, L.L.C., Ap- the terms of the initial loan and a lowering of the in- pellee. terest rate and the amount of installment payments, but did not involve the satisfaction or replacement of the No. 13–0638. original note, an advancement of new funds, or an in- Argued Dec. 4, 2013. crease in the obligations created by the original note, Decided May 16, 2014. was not a new extension of credit that was required to Rehearing Denied Oct. 3, 2014. meet the constitutional requirements for a new loan; Background: Borrowers brought putative class action capitalization of past-due amounts was simply a mech- against loan servicer for their home equity loans, al- anism for deferring payments of obligations already leging that parties' post-loan transactions violated Texas owed in a way that allowed borrowers to retain their Constitution. The United States District Court for the homes. Vernon's Ann.Texas Const. Art. 16, § 50. Northern District of Texas, John McBryde, J., 889 *11 David M. Gottfried, Law Office of David Gottfried, F.Supp.2d 883, granted servicer's motion to dismiss. P.C., Austin, Earl Berry Jr., Hurt & Berry, LLP, Edom, Borrowers appealed. The United States Court of Ap- James Patrick Sutton, The Law Office of J. Patrick Sut- peals for the Fifth Circuit, 538 Fed.Appx. 537, affirmed ton, Austin, Jeffrey W. Hurt, Hurt & Berry LLP, Dallas, in part and certified questions to the Texas Supreme TX, for Appellant. Court. Amanda Schaeffer, Benjamin David Lee Foster, Daron Holding: The Supreme Court, Hecht, C.J., held that re- L. Janis, Robert T. Mowrey, Thomas G. Yoxall, Willi- structuring of home equity loan was not extension of am Scott Hastings, Locke Lord LLP, Austin, TX, for new credit required to comply with constitutional re- Appellee. quirements for new loan. Questions answered. Ken Carroll, Carrington Coleman Sloman & Blumenth- al, Dallas, TX, for Amicus Curiae Federal National West Headnotes Mortgage Association. Homestead 202 99 Karen M. Neeley, Cox Smith Matthews, Inc., Austin, 202 Homestead TX, for Amicus Curiae Independent Bankers Associ- 202I Nature, Acquisition, and Extent ation of Texas. 202I(E) Liabilities Enforceable Against B. Scott Daugherty, for Amicus Curiae, Texas Bankers Homestead Association. 202k99 k. Loans and advances. Most Cited Cases John C. Fleming, Law Office of John C. Fleming, Aus- tin, TX, for Amicus Curiae Texas Bankers Association. Mortgages 266 306 © 2015 Thomson Reuters. No Claim to Orig. US Gov. Works. Page 2 440 S.W.3d 10, 57 Tex. Sup. Ct. J. 588 (Cite as: 440 S.W.3d 10) Chief Justice HECHT delivered the opinion of the I Court. Frankie and Patsy Sims obtained a 30–year home equity To avoid foreclosure, homeowners and lenders often try loan in 2003. In 2009, the Simses, behind on their pay- to restructure underwater home mortgage loans that are ments, reached what was entitled a “Loan Modification in default by capitalizing past-due amounts as principal, Agreement” with Carrington Mortgage Services, L.L.C. lowering the interest rate, and reducing monthly pay- The agreements involved capitalizing past-due interest ments, thereby easing the burden on the homeowners. and other charges, including fees and unpaid taxes and But home equity loans are subject to the requirements insurance premiums, and reducing the interest rate and of Article XVI, Section 50 of the Texas Constitution. monthly payments. Two years later, the Simses were The United States Court of Appeals for the Fifth Circuit again behind, and this time CMS sought foreclosure. has asked whether those requirements apply to such The Simses resisted, asserting that the 2009 restructur- FN1 loan restructuring. We answer that as long as the ing violated constitutional requirements for home equity original note is not satisfied and replaced, and there is loans. The parties then reached a second “Loan Modi- no additional extension of credit, as we define it, the re- fication Agreement”, further reducing the interest rate structuring is valid and need not *12 meet the constitu- and payments. The following chart summarizes the loan tional requirements for a new loan. data at the outset and after the two restructurings: FN1. 538 Fed.Appx. 537 (5th Cir.2013) (per curiam); see TEX. CONST. art. V, § 3–c(a) (“The supreme court [has] jurisdiction to an- swer questions of state law certified from a fed- eral appellate court.”). Principal Amt. Cap'd New Prin. Rate Payment Appraisal 2003 Loan $76,000.00 — — 9% $611.51 $96,000 2009 Mod. $72,145.50 $2,200.00 $74,345.50 6.5% $511.16 $72,300 2011 Mod. $72,655.61 $7,368.44 $80,023.95 4.75% $492.34 $73,000 return for a loan that I have received, I promise The original note required the Simses to pay prin- to pay U.S. $76,000.00 (this amount is called FN2 cipal, interest, and late charges. The security agree- ‘principal’), plus interest, to the order of the ment echoed that requ [Text truncated at 120,000 characters. The full text is on the page linked above.] --- Source: Frix Law Library, https://www.frixlaw.com/law-library/cases/4064231. Public record. Not legal advice.