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Motions to dismiss in mortgage foreclosure suit denied as untimely
Charles and Laura Jones, in Grinnell State Bank v. Jones, No. 15-0674 (April 27, 2016), appealed from an order denying their motion to dismiss Grinnell State Bank’s mortgage-foreclosure action.
On January 7, 2014, Grinnell State Bank filed suit to foreclose the Joneses’ real estate mortgage, seeking judgment in rem and in personam. The Joneses filed their answer on February 14, 2014. On February 24, 2014, the bank moved for summary judgment, and the Joneses did not resist. On April 8, 2014, the court entered a decree of foreclosure, and the bank proceeded to a special execution. On April 25, 2014, the Joneses’ attorney was suspended from the practice of law. The bank was the successful bidder at the sale and received a Sheriff’s Deed on June 10, 2014.
The debtors hired new counsel, and on September 19, 2014, the debtors filed a motion to dismiss the foreclosure action, arguing that the suit was barred by issue preclusion, claim preclusion, res judicata, and/or collateral estoppel, all arising from a foreclosure suit that the bank had filed on June 4, 2013, but for which decree, on January 3, 2014, the bank had filed a notice of rescission, pursuant to Iowa Code section 654.17.
Although the trial court addressed the merits of their issue-preclusion claim, the Court of Appeals addressed only the timeliness of the motion to dismiss. Iowa Rule of Civil Procedure 1.441(1) states, “Motions attacking a pleading must be served before responding to the pleading or, if no responsive pleading is required by these rules, within 20 days after the service of the pleading on such party.” The Court of Appeals held, “The Joneses moved to dismiss the petition more than seven months after filing their answer. The motion to dismiss—which was filed more than eight months after the petition, seven months after the answer, five months after the foreclosure decree, and three months after the property was sold at auction—was clearly untimely.”
On appeal, the Joneses for the first time argued that their untimeliness was excusable, because they “were essentially unrepresented” when their prior attorney was suspended from the practice of law “unbeknownst to [them].” However, because the Joneses “failed to request an extension of time for filing their motion to dismiss and never claimed excusable neglect in the district court,” the Court of Appeals could not consider the claim for the first time on appeal. The Court of Appeals, therefore, affirmed the denial of the motion to dismiss.
The Joneses’ arguments are confusing; although their attorney was, in fact, suspended, the suspension occurred after the attorney had filed an answer on the Joneses’ behalf—thus, it is unclear how the attorney’s later suspension could have constituted “excusable neglect,” especially when the attorney had filed an answer. In any event, Grinnell State Bank v. Jones provides a good example of the importance of clearly stating all arguments before the trial court, and making sure that the trial court addresses all arguments, so that the appellate court finds that error has been preserved.
For questions regarding Grinnell State Bank v. Jones or commercial litigation, contact Mollie Pawlosky.
The material in this blog is not intended, nor should it be construed or relied upon, as legal advice. Please consult with an attorney if specific legal information is needed.
Source: http://www.dickinsonlaw.com/2016/05/motions-dismiss-mortgage-foreclosure-suit-denied-untimely/
