Gloria Ann Butler v. Towd Point Master Funding Trust 2020-1, US Bank National Association, As Indenture Trustee

Judgment rendered January 15, 2025.
Application for rehearing may be filed
within the delay allowed by Art. 2166,
La. C.C.P.

No. 56,004-CA

COURT OF APPEAL
SECOND CIRCUIT
STATE OF LOUISIANA

*****

GLORIA ANN BUTLER Plaintiff-Appellant

versus

TOWD POINT MASTER Defendant-Appellee
FUNDING TRUST 2020-1, US
BANK NATIONAL
ASSOCIATION, AS
INDENTURE TRUSTEE

*****

Appealed from the
Fourth Judicial District Court for the
Parish of Morehouse, Louisiana
Trial Court No. 2023-050

Honorable Alvin Rue Sharp, Judge

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RANKIN, YELDELL, & KATZ P.C. Counsel for
By: Alex W. Rankin Plaintiff-Appellant

GALLOWAY, JOHNSON, Counsel for
TOMPKINS, BURR & SMITH Defendant-Appellee
By: Lindsay M. Young
Tyler J. Minick

*****

Before STONE, STEPHENS, and HUNTER, JJ.

HUNTER, J.

Plaintiff, Gloria Ann Butler, appeals a district court judgment granting

an exception of no cause of action in favor of defendants, Towd Point

Master Funding Trust 2020-1 and U.S. Bank National Association, as

Indenture Trustee, and dismissing her case with prejudice. For the following

reasons, we affirm.

FACTS

Plaintiff, Gloria Ann Butler, and Eddie Don Butler (“the decedent”)

were married. They separated in 2010 but did not divorce. At some point,

the decedent executed a note and mortgage on a manufactured home, which

was situated on land located in Morehouse Parish. The land was community

property; however, plaintiff did not sign or consent to the mortgage on the

manufactured home, and she never lived in the home. The decedent

defaulted on the mortgage.

On September 20, 2022, defendants, Towd Point Master Funding

Trust 2020-1 and U.S. Bank National Association, as Indenture Trustee

(collectively “Towd”), filed a lawsuit for reformation of mortgage,

declarative judgment, quiet title, and other relief against plaintiff and the

decedent. Plaintiff was served with the petition but did not file any

pleadings or answer to the petition. On December 12, 2022, Towd filed a

motion for a default judgment; the district court entered a default judgment

in favor of Towd. Plaintiff did not seek a new trial, nor did she appeal.

Subsequently, on February 6, 2023, plaintiff filed a petition to annul

the judgment of default. Plaintiff alleged the December 2022 judgment was

invalid because “the judgment was taken by mail and without any

appearance by petitioner nor any witness testimony, or affidavit testimony.”

Plaintiff also alleged Towd failed to produce any evidence to support its

petition for a default judgment.

In response, Towd filed a peremptory exception of no cause of action.

Towd argued La. C.C.P. art. 2002, which allows certain judgments to be

annulled, applies only to technical defects of procedure or form of the

judgment. Towd also argued the failure to establish a prima facie case is not

a vice of form, and the issue should have been raised in a motion for new

trial or by appeal, rather than by an action for nullity.

The district court sustained the exception of no cause of action and

dismissed plaintiff’s action with prejudice, stating:

***
The Court doesn’t resort to equity when the law is clear. Here,
in this case, we had a suit filed. We had what appears to be
proper service. We had the proper passage of time. A default
judgment was secure – ultimately secured. Now, we are
basically asking – receiving a request to have it set aside under
the discretion for, I will call it, almost social reasons as opposed
to legal reasons.
***

Plaintiff appeals.

DISCUSSION

Plaintiff contends the district court erred in sustaining the exception of

no cause of action. She argues prior to sustaining the exception, the district

court was required to consider the elements of the claims set forth in her

petition and attachments to determine whether the petition stated a claim

against Towd upon which a remedy may be granted. According to plaintiff,

the court was also required to take the well-pleaded facts as true and resolve

any doubts or reasonable inferences in favor of the plaintiff; however, the

district court summarily sustained the exception without analyzing plaintiff’s

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pleadings, accepting the facts pled as true, or rendering all reasonable

inferences in favor of plaintiff.

The function of the peremptory exception of no cause of action is to

test the legal sufficiency of the petition, which is done by determining

whether the law affords a remedy on the facts alleged in the pleading. Ramey

v. DeCaire, 03-1299 (La. 3/19/04), 869 So. 2d 114. No evidence may be

introduced at any time to support or controvert the objection that the petition

fails to state a cause of action. La. C.C.P. art. 931. Therefore, the court

reviews the petition and accepts well-pleaded allegations of fact as true.

Ramey, supra. All doubts are resolved in favor of the sufficiency of the

petition to afford litigants their day in court. Jackson v. City of New

Orleans, 12-2742 (La. 1/28/14), 144 So. 3d 876. The issue at the trial of the

exception of no cause of action is whether, on the face of the petition, the

plaintiff is legally entitled to the relief sought. Ramey, supra.

An appellate court’s review of a trial court’s ruling sustaining or

denying an exception of no cause of action is de novo because the exception

raises a question of law, and the trial court’s decision is based only on the

sufficiency of the petition. Grayson v. Gulledge, 55,214 (La. App. 2 Cir.

9/27/23), 371 So. 3d 1133, writ denied, 23-01437 (La. 1/10/24), 376 So. 3d

847.

The nullity of a final judgment may be demanded for vices of either

form or substance, as provided in Articles 2002 through 2006. La. C.C.P.

art. 2001. A final judgment shall be annulled if it is rendered against a

defendant who has not been served with process as required by law and who

has not waived objection to jurisdiction, or against whom a valid default

judgment has not been taken. La. C.C.P. art. 2002(A)(2).
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It is well settled La. C.C.P. art 2002 applies only to technical defects

of procedure or form of the judgment. Nat’l Income Realty Tr. v. Paddie,

98-2063 (La. 7/2/99). The failure to establish the prima facie case required

by La. C.C.P. art. 1702 is not a vice of form. Id., citing Hollander v.

Wandell, 97-556 (La. App. 5 Cir. 11/12/97), 703 So. 2d 742; State v. One

1990 GMC Sierra Classic Truck, 94-0639 (La. App. 4 Cir.11/30/94), 646

So. 2d 492, writ denied, 94-3171 (La. 2/17/95), 650 So. 2d 254. A failure of

proof must be raised in a motion for new trial or by appeal, not by an action

for nullity. Nat’l Income Realty Tr. v. Paddie, supra, citing Frank L. Maraist

and Harry T. Lemmon, Civil Procedure, 1 La. Civ. L. Treatise, § 12.6

(1999).

In Nat’l Income Realty Tr. v. Paddie, supra, a tenant filed a lawsuit

alleging she sustained injuries in a fall at an apartment complex. The tenant

named various defendants, who she alleged were “owners and/or agents

and/or managers for the owners.” One of the defendants, CCIT, was a real

estate investment trust located in the State of California. CCIT was served

but did not file an answer or responsive pleading. Subsequently, the district

court entered a default judgment against CCIT in the amount of $250,000,

plus legal interest and costs. CCIT did not seek a new trial or appeal. More

than one year later, NIRT, CCIT’s successor, filed a lawsuit seeking to

nullify the default judgment. Like the plaintiff herein, NIRT argued the

default judgment was an absolute nullity because the plaintiff “presented no

evidence at the default confirmation hearing to show NIRT owned, operated,

or managed the apartment complex or otherwise owed any delictual duty to

her.” The district court dismissed the petition to annul, and the court of

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appeal reversed. The Louisiana Supreme Court reversed the court of

appeal’s ruling and reinstated the district court’s judgment, stating:

In the instant case, it is clear NIRT has not asserted any defect
in the procedure or form of the default judgment. Rather,
NIRT’s sole contention is that Ms. Paddie failed to present
sufficient evidence under La. Code Civ. P. art. 1702 to support
her contention that CCIT owned the apartment building. This
claim may be properly raised by timely motion for new trial or
by appeal, but is not a ground for an action in nullity.

Such an interpretation is necessary to preserve the sanctity of
judgments. Under NIRT’s theory, any default judgment, though
procedurally proper on its face, could be attacked at any time,
based on the failure to present sufficient proof. The resulting
uncertainty would make it virtually impossible to rely on a final
judgment obtained by default. This is why the law wisely
allows such defects to be raised only by motion for new trial or
on appeal.

Id., at 1271-72 (footnotes omitted).

In the instant case, plaintiff has not asserted any defect in the

procedure or form of the default judgment. Plaintiff argues she was

entitled to an annulment of the default judgment it was rendered

“against a defendant . . . whom a valid default judgment has not been

taken.” Plaintiff also asserts Towd obtained a default judgment

without presenting any evidence. Plaintiff’s claim may be properly

raised by timely motion for new trial or by appeal, but is not a ground

for an action in nullity. Accordingly, we find the district court did not

err in granting Towd’s exception of no cause of action and dismissing

plaintiff’s claims.

CONCLUSION

For the foregoing reasons, the judgment of the district court sustaining

the exception of no cause of action and dismissing plaintiff’s petition is

affirmed. Costs of the appeal are assessed to plaintiff, Gloria Ann Butler.

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AFFIRMED.

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