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Thornton v. Norwest Bank of Minnesota

November 4, 2004

CORA THORNTON, APPELLANT
v.
NORWEST BANK OF MINNESOTA, APPELLEE



Appeal from the Superior Court of the District of Columbia (CA-3346-01), (Hon. Anna Blackburne-Rigsby, Trial Judge).

Before Terry and Glickman, Associate Judges, and Ferren, Senior Judge.

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

Argued April 23, 2003

Appellant Thornton defaulted on a loan from Norwest Bank of Minnesota ("Norwest") in early 2000. Norwest then foreclosed on appellant's house, which she had used to secure the loan. After appellant refused to vacate the house, Norwest filed this suit for possession in the Superior Court and moved successfully for summary judgment. We affirm.

I.

In May 1997 appellant obtained a loan from Norwest in the amount of $321,750. The loan was secured by a promissory note and deed of trust on appellant's home on Fourteenth Street, N.W., in the District of Columbia. In early 2000 appellant defaulted on her monthly payments.

In order to protect herself financially, appellant filed a voluntary bankruptcy petition*fn1 in the United States Bankruptcy Court for the District of Columbia. The Bankruptcy Court, however, dismissed appellant's petition with prejudice on August 16, 2000, after finding that she could not fund an acceptable Chapter 13 plan. The same court also denied appellant's motion for reconsideration. Thereafter, on October 2, 2000, Norwest foreclosed on appellant's property. The foreclosure sale took place at Weschler's Auction House, located at 905 E Street, N.W., in downtown Washington.*fn2 The sale was attended by only one of the two appointed trustees named in the deed of trust. There were only two bidders at the auction, including Norwest, which ultimately purchased the property.

Before the foreclosure sale took place, appellant appealed from the dismissal of her bankruptcy petition to the United States District Court for the District of Columbia on September 29, 2000. See 28 U.S.C. § 158 (a) (2000) (authorizing a United States District Court to hear appeals in bankruptcy cases in certain circumstances); FED. BANKR. R. 8001. The District Court dismissed the appeal on January 31, 2001. Appellant sought reconsideration of that dismissal, but it was denied.

Meanwhile, as the purchaser of the property, Norwest sent appellant on February 13, 2001, a thirty-day notice to vacate the premises. After appellant failed to comply, Norwest filed suit for possession in the Landlord and Tenant Branch of the Superior Court. Appellant responded by filing a plea of title and a counterclaim for wrongful foreclosure. After discovery was completed, Norwest moved for summary judgment. The trial court, after a hearing, granted Norwest's motion on the ground that the foreclosure sale was valid and complied fully with the deed of trust. Appellant's plea of title and counterclaim were dismissed. From that ruling appellant noted the present appeal.

II.

In reviewing an order granting a motion for summary judgment, this court must "assess the record independently . . . [and view it] in the light most favorable to the party opposing the motion." Kelley v. Broadmoor Cooperative Apartments, 676 A.2d 453, 456 (D.C. 1996)) (citations and internal quotation marks omitted). This court "will affirm the entry of summary judgment if there is no genuine issue as to any material fact and . . . the moving party is entitled to judgment as a matter of law." Holland v. Hannan, 456 A.2d 807, 814 (D.C. 1983) (citing Super. Ct. Civ. R. 56 (c)).

Appellant argues that Norwest should have been precluded from foreclosing on her property because it had reason to know that she was appealing to the United States District Court from the dismissal of her bankruptcy petition. She also claims that because the foreclosure sale did not comply with the requirements of the deed of trust, it should be voided. Furthermore, she asserts that her eviction under the circumstances amounted to a due process violation. We hold that, even when the relevant facts are viewed in the light most favorable to appellant, all of her arguments are without merit.

A. The Foreclosure

On August 16, 2002, the Bankruptcy Court dismissed appellant's bankruptcy petition with prejudice. While dismissals with prejudice are not typical, the bankruptcy court acted well within its authority in doing so. See 11 U.S.C. 349 (a) (2000); In re Hall, 304 F.3d 743, 746-747 (7th Cir. 2002); see also 1 COLLIER BANKRUPTCY MANUAL § 349.02 [2] (3d rev. ed. 1998). The order dismissing appellant's petition was the functional equivalent of a final decision on the merits, thus effectively closing her case. Such a dismissal is a final judgment with the preclusive effect of res judicata "not only as to all matters litigated and decided by it, but as to all relevant issues which could have been but were not raised and litigated in the suit." Heiser v. Woodruff, 327 U.S. 726, 735 (1946); see also Speleos v. McCarthy, 201 B.R. 325, 329 (D.D.C. 1996) ("it is axiomatic that a final order . . . binds the parties to the case beyond the close of proceedings"). The finality of the bankruptcy court's order could be altered only if that order were reversed on appeal. See Jordan v. Washington Metropolitan Area Transit Authority, 548 A.2d 792, 795 n.4 (D.C. 1988); Adams v. Jonathan Woodner Co., 475 A.2d 393, 397 (D.C. 1984). That never happened; on the contrary, the appeal was dismissed. Accordingly, even if Norwest was aware that appellant was appealing to the District Court, it was entitled to foreclose on the property after the bankruptcy court dismissed her petition with prejudice. See In ...


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