DWIGHT C. JONES APPELLANT
CENTENNIAL BANK f/k/a LIBERTY BANK OF ARKANSAS APPELLEE
FROM THE YELL COUNTY CIRCUIT COURT, NORTHERN DISTRICT [NO.
75NCV-17-54] HONORABLE TERRY SULLIVAN, JUDGE
Law Group, PLLC, by: J. Shane Cox, for appellant.
Law Firm, P.A., by: John R. Peel; and Brett D. Watson,
Attorney at Law, PLLC, by: Brett D. Watson, for appellee.
LARRYD. VAUGHT, Judge
C. Jones appeals the foreclosure decree entered by the Yell
County Circuit Court on July 14, 2017, in favor of Centennial
Bank f/k/a Liberty Bank of Arkansas (Centennial Bank). On
appeal, Dwight raises multiple arguments in support of
reversal: (1) he was not provided notice of the foreclosure
hearing in violation of his due-process rights; (2)
Centennial Bank failed to plead waiver of his right of
redemption in its foreclosure complaint; (3) Centennial Bank
failed to comply with 12 C.F.R. § 1024.36; and (4) the
multipurpose note and security agreement did not contain a
legal description of the foreclosed property. We hold that
Dwight's due-process rights were violated when he was
denied the opportunity to attend the foreclosure hearing;
therefore, we reverse and remand.
2005, Dwight and his mother, Margaret Jones, borrowed $64,
137.10 from Centennial Bank. They secured the loan by
executing a promissory note in favor of Centennial Bank and
by executing a mortgage that granted the bank a lien on their
property situated at 105, 107, and 111 North Front Street,
Dardanelle, Yell County, Arkansas (the
property). Thereafter, Dwight and his mother entered
into notes, mortgage-modification agreements, and other
documents related to the property that extended the maturity
date of the note, amended the payment schedule, and included
additional terms concerning late charges.
December 25, 2015, Margaret died. On May 1, 2017, Centennial
Bank filed a complaint for foreclosure against the
administrator of Margaret's estate, Dwight, and the
Commissioner of State Lands. The complaint alleged that
Margaret and Dwight were the owners of the property, they had
executed mortgages in favor of Centennial Bank, and they had
granted Centennial Bank a security interest in the property.
The complaint further alleged that Margaret ceased making
monthly payments to Centennial Bank, she was in arrears
despite demands for payments, and Centennial Bank elected to
declare the entire principal and accrued interest due based
on Margaret's default. Centennial Bank sought judgment of
the unpaid principal of $27, 952.93, plus interest, late
fees, and expenses in rem against the administrator of
Margaret's estate. Centennial Bank further requested that
its lien be foreclosed and the property sold should the
estate fail to pay the judgment within a time specified by
the circuit court.
record reflects that all three defendants were served with
the foreclosure complaint; specifically, Dwight was
personally served with the complaint on May 12, 2017. Dwight
filed a timely pro se response to the complaint on June 12,
2017. Dwight stated in his response that his name is on the
deed to the property; he had made payments on the loan in
question; he had requested information about the loan from
Centennial Bank, but the bank would not talk to him; he
requested access to the loan papers; and he did not want to
default on the land and would "secure said debt paid in
full and or secure a debt on such lands to satisfy any and
all part[ies] . . . ."
record further reflects that on July 14, 2017, the circuit
court held a foreclosure hearing. There is nothing in the
record to suggest that Dwight was notified of this hearing.
In attendance were counsel for Centennial Bank and Centennial
Bank senior loan officer, Mark Rezanka. Centennial Bank's
counsel reported to the circuit court that the administrator
of Margaret's estate and staff counsel for the
Commissioner of State Lands had approved a proposed
foreclosure decree. Counsel for Centennial Bank further
advised the court that Dwight had filed an answer but was not
at the hearing. The court asked the bailiff to call for
Dwight outside the courtroom. The bailiff did and reported
that there was no response. The circuit court stated,
"No response. All right. Well, we're going to take,
I guess, testimony for the record."
Bank called Rezanka, who testified about the mortgages and
notes executed by Margaret. He further testified that
Margaret had passed away, that she and Dwight were co-owners
of the property, that Margaret had not paid on the note, that
the note was in default, and that Centennial Bank was seeking
foreclosure. Thereafter, the circuit court granted Centennial
Bank a judgment against the property in rem against
Margaret's estate. The circuit court entered a
foreclosure decree later in the day on July 14, 2017. In the
decree, the court appointed Sharon Barnett as the
commissioner of the court to execute the decree and directed
her to conduct the foreclosure sale.
morning of July 19, 2017, Barnett filed a notice of sale
stating that the property would be offered for public sale on
August 16, 2017. On the afternoon of July 19, 2017, Dwight,
still proceeding pro se, filed a document with no title
asserting that he had filed a timely response to the
foreclosure complaint, yet was not provided notice of the
foreclosure hearing. He stated that he was "in wonder of
how such a hearing and or meeting could take place without
his knowledge or being notified." He further stated that
he had owned and possessed the property for fifteen years and
prayed that the court "stop any and all proceedings on
such matter until the involving issues can be resolved."
Centennial Bank did not respond to Dwight's filing. On
August 14, 2017, Dwight filed a notice of appeal of the July
14, 2017 foreclosure decree. This appeal followed.
bench trials, the standard of review on appeal is not whether
there is substantial evidence to support the findings of the
circuit court, but whether the circuit court's findings
were clearly erroneous or clearly against the preponderance
of the evidence. Parker v. BancorpSouth Bank, 369
Ark. 300, 305, 253 S.W.3d 918, 922 (2007). A finding is
clearly erroneous when, although there is evidence to support
it, the reviewing court on the entire evidence is left with a
firm conviction that a mistake has been committed.
Id., 253 S.W.3d at 922.
first point on appeal is that his due-process rights were
violated when he was not provided notice of the foreclosure
hearing. The fundamental requirement of due process is the
opportunity to be heard at a meaningful time and in a
meaningful manner. Villanueva v. Valdivia, 2016
Ark.App. 107, at 4, 483 S.W.3d 308, 310-11 (citing Tsann
Kuen Enters. Co. v. Campbell, 355 Ark. 110, 117-118, 129
S.W.3d 822, 826 (2003)). An elementary and fundamental
requirement of due process in any proceeding that is to be
accorded finality is notice reasonably calculated, under all
the circumstances, to apprise interested parties of the
pendency of the action and afford them an opportunity to
present their objections. Id. at 5, 483 S.W.3d at
Jones v. Vowell, 99 Ark.App. 193, 200, 258 S.W.3d
383, 388 (2007), the appellant's dental-malpractice case
was dismissed with prejudice pursuant to Arkansas Rule of
Civil Procedure 41(b) because she failed to attend a hearing.
On appeal, she contended that the dismissal was in error
because she received no notice of the hearing, which violated
her due-process rights, and that the circuit court abused its
discretion in dismissing her complaint under Rule 41(b). 99
Ark.App. at 196, 258 S.W.3d at 385. On appeal, specifically
on the due-process point, our court reversed and remanded,
holding that based on the record in that case, the dismissal
of the ...