Brown v. United Bank , 448 S.W.3d 726 ( 2014 )

Cite as 2014 Ark. App. 643
ARKANSAS COURT OF APPEALS
DIVISION III
No.CV-14-397
Opinion Delivered November 12, 2014
HOMER EUGENE BROWN AND APPEAL FROM THE BENTON
TAMMY LYNN BROWN COUNTY CIRCUIT COURT
APPELLANTS [NO. CV-12-2280]
V. HONORABLE BRADLEY LEWIS
KARREN, JUDGE
UNITED BANK ET AL.
APPELLEES DISMISSED
LARRY D. VAUGHT, Judge
This is a foreclosure case. On January 23, 2014, the Circuit Court of Benton County
entered three orders: one denying the motion to set aside a foreclosure sale filed by appellants,
Tammy and Homer Brown; a second setting a hearing on surplus funds; and a third confirming
the foreclosure sale. On January 31, 2014, the trial court entered an amended order confirming
the foreclosure sale. On February 6, 2014, the Browns filed a notice of appeal, arguing that the
trial court abused its discretion in failing to set aside the foreclosure sale and that the trial court
erred in failing to enforce an oral contract between the Browns’ counsel and counsel of separate
appellee, United Bank. We dismiss for lack of jurisdiction.
On June 20, 2012, the Browns executed a promissory note in favor of United Bank in
the amount of $44,809.62. That same day, the Browns executed a mortgage on their home and
real property in favor of United Bank to secure the loan. When the Browns defaulted on the
loan, United Bank filed a foreclosure complaint and an amended foreclosure complaint against
Cite as 2014 Ark. App. 643
the Browns (and others with purported interests in the property), alleging that the Browns were
in default on the loan and owed United Bank $47,083.89 plus interest. United also alleged that
the Browns owed it $26,327.18 in insurance proceeds resulting from a homeowner’s claim. The
Browns answered the foreclosure complaint and filed a counterclaim against United Bank,
alleging predatory-mortgage servicing, breach of fiduciary duty, abuse of process, civil
conspiracy, constructive fraud, and violations of the Arkansas Deceptive Trade Practices Act.
On October 1, 2013, the trial court entered an agreed decree of foreclosure and dismissal
of the counterclaim following an August 5, 2013 hearing. In relevant part, the decree stated that
United Bank was entitled to judgment against the Browns in the amount of $71,496.64 plus
interest; that United Bank would refrain from conducting a Commissioner’s sale of the real
property for sixty days; that the Browns had sixty days from the date of the agreed decree to
tender the total amount of the judgment and upon tender United Bank would convey the
property to the Browns; that if the Browns failed to pay United Bank the judgment, then
United Bank could conduct a public sale through the Commissioner; that United Bank’s right
to foreclose was absolute on the sixtieth day after the agreed decree of foreclosure; and that the
Browns’ counterclaim was dismissed with prejudice.
The Browns did not tender payment to United Bank within the sixty-day period. On
November 18, 2013, United Bank filed a notice of a commissioner’s sale. The notice stated that
the sale of the Browns’ property would be held at 10:00 a.m. on December 16, 2013. On
November 25, 2013, United Bank published notice of the December 16, 2013 sale in the
Northwest Arkansas Newspapers.
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The foreclosure sale was held December 16, 2013. Neither the Browns nor their counsel
attended the sale. The Browns’ property was purchased by KSBD, LLC, and Shane Miller for
$135,000. On December 26, 2013, the Browns filed a motion to set aside the foreclosure sale.
After a hearing on the Browns’ motion,1 the trial court denied the Browns’ motion to set aside
the foreclosure sale. Thereafter, on January 23, 2014, the trial court entered three separate
orders (1) denying the Browns’ motion to set aside the sale and granting the purchasers’ motion
to intervene; (2) setting a hearing on the surplus funds from the sale; and (3) confirming the
foreclosure sale. The order confirming the sale listed KSBD, LLC, as the sole purchaser of the
Browns’ property—but it did not include Shane Miller. On January 31, 2014, the trial court
entered an amended order confirming the foreclosure sale. The amended order added Shane
Miller, along with KSBD, LLC, as purchaser of the Browns’ property. The Browns filed a
notice of appeal on February 6, 2014. The notice stated that “[t]he order appealed from is the
order entered on the 23rd day of January, 2014.” We cannot reach the merits of the Browns’
appeal because they failed to appeal from the only final, appealable order entered in this case.
Rule 2(a)(1) of the Rules of Appellate Procedure–Civil provides that an appeal may be
taken from a final judgment or decree entered by the trial court. Robinson v. Lindsey, 2014 Ark.
App. 287, at 1. When the appealed order is not final, however, we will not decide the merits of
the appeal. Id. Whether a final judgment, decree, or order exists is a jurisdictional issue that we
have the duty to raise, even if the parties do not, in order to avoid piecemeal litigation. Id. For
1
At the hearing, counsel for the purchasers of the Browns’ property, KSBD, LLC, and
Shane Miller, moved to intervene; the motion was granted by the trial court.
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Cite as 2014 Ark. App. 643
a judgment to be final, it must dismiss the parties from the court, discharge them from the
action, or conclude their rights to the subject matter in controversy. Id. at 1–2. The order must
put the trial court’s directive into execution, ending the litigation or a separable branch of it. Id.
at 2. An order is not final when it adjudicates fewer than all of the claims or rights and liabilities
of fewer than all the parties. Id.
Generally, a decree confirming a foreclosure sale is a separate, final, and appealable
order, and a notice of appeal must be given within thirty days of that decree. Budget Tire &
Supply Co. v. First Nat’l Bank of Fort Smith, 51 Ark. App. 188, 193, 912 S.W.2d 938, 941 (1995).
Decrees confirming a foreclosure sale are final because they place the court’s directive into
execution and no additional orders are required prior to a foreclosure sale. Id., 912 S.W.2d at
941. However, an order determining the parties’ rights and obligations in a foreclosure action
but failing to provide for execution and indicating that further judicial action would be
necessary before foreclosure and execution would be ordered is not a final, appealable order.
Id., 912 S.W.2d at 940.
The Browns’ February 6, 2014 notice of appeal stated that “[t]he order appealed from
is the order entered on the 23rd day of January, 2014.” As set forth above, there were three
orders entered on January 23, 2014. While it is not clear from the face of the notice of appeal
which order the Browns are appealing, only one of the three orders could be a final, appealable
order—the order confirming the sale.2 Id., 912 S.W.2d at 941. However, this order is not the
2
The January 23, 2014 order denying the motion to set aside the foreclosure sale is not
a final, appealable order because it did not place the court’s directive into execution and
additional orders were required prior to a foreclosure sale, i.e., the order confirming the
foreclosure sale. Budget Tire, 51 Ark. App. at 193, 912 S.W.2d at 941.
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final, appealable order in this case because it did not dispose of the rights of Miller, one of the
purchasers of the Browns’ property. In their brief, the Browns concede that Miller is a party
interested in the outcome of this proceeding. He was represented at, and participated in, the
hearing held January 10, 2014. Because the January 23 order confirming the foreclosure sale
adjudicated fewer than all the claims or rights and liabilities of fewer than all the parties, it is not
a final, appealable order. Robinson, 2014 Ark. App. 287, at 2.
The only final, appealable order in this case was the January 31, 2014 amended order
confirming the sale. This order included Miller, which had the effect of determining all of the
parties’ rights and obligations in this foreclosure action and placing the court’s directive into
execution so that no additional orders were required prior to a foreclosure sale. Budget Tire, 51
Ark. App. at 193, 912 S.W.2d at 941. However, the Browns’ February 6, 2014 notice of appeal
did not designate the January 31, 2014 amended order confirming the foreclosure sale. And this
amended order was filed of record at the time the Browns filed their notice.
Rule 3(e) of the Arkansas Rules of Appellate Procedure–Civil provides that a notice of
appeal shall “designate the judgment, decree, order or part thereof appealed from . . .[.]” Ark.
R. App. P.–Civ. 3(e)(ii) (2014). Orders not mentioned in a notice of appeal are not properly
before the appellate court. Id.; Racine v. Nelson, 2011 Ark. 50, at 9, 378 S.W.3d 93, 99. Because
the Browns’ notice of appeal did not state that they were appealing from the only final,
appealable order—the January 31, 2014 amended order confirming the foreclosure sale—we
hold that the Browns’ notice of appeal is fatally deficient, and we lack jurisdiction to hear this
case.
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Cite as 2014 Ark. App. 643
We acknowledge that only substantial compliance with the procedural steps set forth in
Rule 3(e) is required. Jewell v. Moser, 2012 Ark. 267, at 4. A notice of appeal that fails to designate
the judgment or order appealed from as required under Rule 3(e) is deficient, but such a defect
is not necessarily fatal to the notice where it is clear what order the appellant is appealing and
the notice was filed timely as to that order. Id. Substantial compliance has also been found in
cases where there had been a scrivener’s error. Duncan v. Duncan, 2009 Ark. 565, at 5 (holding
that the appellant’s notice of appeal was not fatally flawed where the date of the order in the
notice was incorrect because it was clear from her arguments on appeal what order she was
appealing). Here, the Browns’ notice of appeal—filed February 6, 2014—appealed only from
a January 23 order. It omitted the January 31, 2014 amended order entirely. There is no
evidence of a scrivener’s error, and it is not clear from their arguments on appeal that they are
appealing the January 31 amended order. This is not substantial compliance.
For these reasons, we dismiss the appeal.
Dismissed.
GLOVER and WOOD, JJ., agree.
Don Brady, for appellants.
Taylor Law Partners, LLP, by: William B. Putman, for appellees.
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