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U.S. Bank National Association v. Ukpoma

Court of Appeals of Washington, Division 3

April 2, 2019

U.S. BANK NATIONAL ASSOCIATION, AS TRUSTEE, ON BEHALF OF THE HOLDERS OF ADJUSTABLE RATE MORTGAGE TRUST 2007-2 ADJUSTABLE RATE MORTGAGE-BACKED PASS-THROUGH CERTIFICATES, SERIES 2007-2, Respondent,
v.
ANGELA UKPOMA, Appellant, STATE OF WASHINGTON, DEPARTMENT OF SOCIAL AND HEALTH SERVICES, FINANCIAL SERVICES ADMINISTRATION; BOEING EMPLOYEES CREDIT UNION; KUBESH'S SITE MIXED CONCRETE, INC.; CARRIE SURIANO; COLVILLE VALLEY CONCRETE CORPORATION; RAMPART MMW; NORSTAR HEATING & COOLING; ISLAND PROPERTY INVESTMENTS; UNKNOWN OCCUPANTS OF THE SUBJECT REAL PROPERTY; ALL OTHER UNKNOWN PERSONS OR PARTIES CLAIMING ANY RIGHT, TITLE, ESTATE, LIEN, OR INTEREST IN THE REAL ESTATE DESCRIBED IN THE COMPLAINT HEREIN, Defendants.

          Lawrence-Berrey, C.J.

         Angela Ukpoma defaulted on her home installment loan. U.S. Bank National Association's (U.S. Bank's) agent sent Ms. Ukpoma a notice that her loan balance was accelerated and the entire amount was immediately due and payable. The notice contradictorily stated she could reinstate the loan if she paid the delinquent payments plus various charges 11 or more days before an unscheduled trustee's sale. No such sale ever occurred. For various reasons, U.S. Bank did not bring this judicial foreclosure action until more than eight years after its agent sent its notice.

         We are asked to decide whether the agent's notice was sufficiently clear and unequivocal so as to constitute an acceleration of the installment loan. A majority of this panel concludes that the agent's notice was unclear and did not accelerate the loan.

         We also discuss whether initiating a nonjudicial foreclosure tolls the statute of limitations for commencing a judicial foreclosure action. This author believes there is no tolling but a majority of this panel believes otherwise. We publish this opinion to encourage further debate of this important issue.

         We unanimously conclude that U.S. Bank can judicially foreclose its deed of trust, and we affirm the trial court.

         FACTS

         In December 2006, Angela Ukpoma executed a promissory note for the purchase of her home. The note, secured by a deed of trust, required her to pay monthly installments for 30 years. U.S. Bank is the note holder and assignee of the deed of trust.

         Ms. Ukpoma failed to make a scheduled payment on October 1, 2007, and has failed to make any further payments. On or about February 1, 2008, Quality Loan Service Corporation (QLS) sent Ms. Ukpoma a notice of default. The notice provides in relevant part:

You are hereby notified that [U.S. Bank] has elected to accelerate the loan described herein, and has declared the entire balance of $252, 000.00, plus accrued costs, immediately due and payable. NOTWITHSTANDING SAID ACCELERATION, YOU HAVE THE RIGHT TO REINSTATE THE LOAN BY PAYING THE DELINQUENT PAYMENTS, LATE CHARGES, COSTS AND FEES ON OR BEFORE THE ELEVENTH (11TH) DAY BEFORE THE DATE OF THE TRUSTEE'S SALE . . . .[1]

Clerk's Papers (CP) at 307. In the notice, QLS identified itself as "Agent for U.S. Bank . . ., the Beneficiary." CP at 307.

         QLS did not initiate a trustee's sale until its notice of trustee's sale dated November 7, 2008. The notice set forth the delinquent balance. The cure amount showed that the loan had not been accelerated. QLS discontinued the first sale.

         QLS subsequently initiated and discontinued multiple other trustee's sales. The initiation dates are June 18, 2009, February 23, 2010, May 14, 2010, June 11, 2010, August 22, 2011, and March 13, 2014. Similar to the initial notice of trustee's sale, these notices set forth the delinquent balance and cure amounts. All of the notices showed that the loan had not been accelerated.

         Ms. Ukpoma also filed for bankruptcy protection in 2008 and again in late 2010. The bankruptcy stays shielded Ms. Ukpoma's property for approximately one year.

         On May 13, 2016, U.S. Bank filed the present action to judicially foreclosure its deed of trust. U.S. Bank moved for summary judgment. Ms. Ukpoma responded that the February 1, 2008 default notice accelerated the installment loan so that the action was barred by RCW 4.16.040, the six-year statute of limitations.

         The trial court concluded that QLS's notice was ineffective to accelerate the installment loan. It alternatively concluded that the statute of limitations had not run because the bankruptcies combined with the nonjudicial foreclosures sufficiently tolled the statute. Given these conclusions, the trial court granted U.S. Bank's motion for summary judgment.

         Ms. Ukpoma appeals.

         ANALYSIS

         A. De novo review of ...


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