Opinion:Deutsche Bank National Trust Co. v. Rice, 2021 OK CIV APP 21
Subject matter:Mortgage foreclosure
Date Decided:October 7, 2020; Mandate Issued June 2, 2021
Trial Court:Oklahoma County (Prince, J.)
Route to this Court:Appeal of trial court’s grant of summary judgment
Facts:Plaintiff/Appellee Bank sued Defendant/Appellant Borrower for foreclosure of a mortgage based on Borrower’s default under the associated Note. Borrower asserted several defenses, most salient among them that Bank breached the mortgage contract before the Borrower when the Bank failed to timely pay the property insurance premium from escrowed funds. The trial court granted Bank’s Motion for Summary Judgement, finding that the Borrower was in default on the note and that the Bank is entitled to foreclose its mortgage. Borrower appeals. 
Standard of Review:De novo review of legal rulings based on uncontroverted material facts. Note, however, that mere allegations in a pleading unsupported by evidentiary material will not defeat an otherwise valid motion for summary judgment. 
Analysis:Borrower does not allege that the trial court erred in finding that the Bank was the holder of the Note, that he executed the Note and Mortgage and was in default, or that the amount of the judgment against him is inaccurate. Instead, Borrower asserts that because the Bank breached the Mortgage before him (by failing to make the property insurance payment from escrowed funds in a timely manner), the Bank can’t now accelerate the Note and enforce the Mortgage against him. 
Even if the Bank’s failure to timely make the insurance payment is a breach of the Mortgage, the Borrower produced no evidence that shows he suffered any damages as a result of the Bank’s failure to make the insurance payment on time. The record shows that the Bank’s error was due to an internal control procedure that put a stop payment on the premium check due to its large size and that the Bank rectified the insurance situation by securing coverage with another carrier. 
While it is true that mortgage foreclosure is an equitable proceeding and a trial court may refuse to accelerate a note on equitable grounds, that power should be exercised sparingly. The Bank’s error in this case was due to an internal control procedure and did not amount to oppressive or unconscionable action or otherwise involve unfair dealing with the Borrower. Further, nothing in the record shows that the Bank’s failure to timely pay the insurance premium was the reason that the Borrower defaulted on the Note. 
Vote:3-0. Opinion by Barnes, P.J. Concur: Rapp and Fischer, JJ. 
Other: Petition for Cert denied 8-0.