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Abdel-Kafi v. Citicorp. Mortgage

District of Columbia Court of Appeals

May 03, 2001


Before Wagner, Chief Judge, and Steadman and Reid, Associate Judges.

The opinion of the court was delivered by: Steadman, Associate Judge

Appeal from the Superior Court of the District of Columbia (Hon. Rufus G. King III, Trial Judge)

Argued October 24, 2000

Appellant defaulted on a loan secured by a deed of trust on a condominium apartment at 2301 Connecticut Avenue, N.W. (Unit #8A). Appellee (the "Lender") *fn1 held a foreclosure sale and successfully bid in the property. It then brought an action in the Landlord and Tenant branch to evict appellant from the property. Appellant appeals the grant of judgment of possession to the Lender. He asserts that the foreclosure sale was invalid because the notice of foreclosure: 1) was not sent to the proper address; and, 2) contained the wrong date as of which the cure amount was calculated. We agree with appellant's first argument. *fn2

D.C. Code § 45-715(b) provides that no foreclosure sale under a deed of trust "may take place" unless notice of the sale is given to the owner of the encumbered property "at his last known address." In addition to information concerning the sale, the notice in the case of a residential mortgage must include the amount required to cure the default, Bank-Fund Staff Fed. Credit Union v. Cuellar, 639 A.2d 561, 568-69 (D.C. 1994), and the mortgage debtor may reinstate the loan at any time prior to five days before the foreclosure sale, see § 45-715.1. See also P. Pearlstein, Real Estate Practice in the District of Columbia, Maryland and Virginia, Vol. I, at 5-17 to 5-18 (May 1995).

In the case before us, the Lender sent the notice of foreclosure, dated May 15, 1997, to appellant at the property address on Connecticut Avenue. *fn3 However, at trial, appellant introduced a copy of a letter dated April 21, 1997, sent to the Lender at 1775 Pennsylvania Avenue, N.W., Washington, D.C. 20006, informing the Lender that appellant's address was 4265 Chamoune Street, No. 8, San Diego, CA 92115. This was in conformance with paragraph 14 of the deed of trust, *fn4 which provided:

14. Notices. Any notice to Borrower provided for in this Security Instrument shall be given by delivering it or by mailing it by first class mail unless applicable law requires use of another method. The notice shall be directed to the Property Address or any other address Borrower designates by notice to Lender. Any notice to Lender shall be given by first class mail to Lender's address stated herein, or any other address Lender designates by notice to Borrower. Any notice provided for in this Security Instrument shall be deemed to have been given to Borrower or Lender when given as provided in this paragraph. (Emphasis added.)

The deed of trust gave the Lender's address as 1775 Pennsylvania Ave. N.W., Washington, D.C. 20006, and the trial court said that it had "no particular reason to believe that he did not" send the notice as he had testified.

Nonetheless, the trial court agreed with the Lender's argument that the notice of foreclosure was properly sent when directed only to the Connecticut Avenue address. First, the Lender argued that the change of address notice itself had been sent to the wrong address. It introduced evidence of correspondence between it and appellant concerning the loan and its default which had been between appellant at the Connecticut Avenue address and the Lender at an address in Ballwin, Missouri. It also noted that a form of mortgage statement given to appellant constituted notice of a change of address. We do not think either of these is sufficient to invalidate appellant's formal compliance with the express terms of the deed of trust. The form of mortgage statement lists no less than six different addresses for the Lender, depending upon the nature of the business, and nowhere suggests that it supersedes all other addresses. By the same token, correspondence with the Lender at one address cannot, it seems to us, suffice to constitute the "other address Lender designates by notice to Borrower," as formally required by the security instrument.

Alternatively, the Lender argues that it was entitled to consider as appellant's "last known address" the Connecticut Avenue property at which all correspondence had been previously directed. The record, however, indicates that as best we can tell all such correspondence was in fact conducted prior to the April 21, 1997, letter giving the new address to the Lender and therefore could hardly act as the "last" known address. The only letters subsequent to that date contained in the exhibits are to third parties involving the unrelated matter of an insurance policy, which happen to have been written on stationery with his Connecticut Avenue as a masthead.

The notice of foreclosure is one of the key legal documents in the process whereby the borrower is stripped of title to his or her property. Among other things, a prime purpose of the notice provision is to give the borrower a viable chance to cure his default or take other appropriate action to avoid foreclosure. See Independence Fed. Savings Bank v. Huntley, 573 A.2d 787, 788 (D.C. 1990). In cases of doubt, we have construed the statute in favor of the homeowner, Cuellar, 639 A.2d at 570, and have adopted the principle that mandates strict compliance by lenders with the rules governing trust deed foreclosures. Huntley, 573 A.2d at 788.

We must conclude, then, that because appellant's change of address letter was properly sent to the Lender's Washington D.C. office designated in the deed of trust, the ensuing notice of foreclosure did not comply with § 45-715's mandate that the notice be sent to appellant's "last known address." The judgment accordingly is Reversed.

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