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Vanderbilt Mortgage and Finance, Inc. v. Crosby

United States District Court, S.D. Alabama, Southern Division

July 23, 2015

STEPHEN D. CROSBY, et al., Defendants.


KRISTI K. DuBOSE, District Judge.

This matter is before the Court on Plaintiff Vanderbilt Mortgage and Finance, Inc.'s Motion to Confirm Foreclosure Sale and for Entry of Final Judgment. (Doc. 47).

In October 2012, the Defendants ("the Crosbys") purchased a mobile home from CMH Homes, Inc., d/b/a Clayton Homes Northport, AL, and executed a manufactured home retail installment contract and disclosure statement (the contract). (Doc. 1-1; Doc. 35-1 at 2 (Aff. Ridge); Doc. 29 (amended)). In the contract, the Crobsys promised to repay the principal sum of $61, 380.97 at 11.20% interest in 240 monthly installments of $765.09. ( Id. ) As part of the contract, CMH and the Crosbys assigned CMH's interests to Plaintiff Vanderbilt Mortgage and Finance, Inc. (VMF). (Doc. 1-1 at 11; Doc. 35-1 at 2 (Aff. Ridge)). In conjunction with the purchase of the mobile home and as security for that contract, the Crosbys granted VMF a $64, 535.73 mortgage on real property (5 acres) in Toxey, Alabama. (Doc. 1-2).[1] Ultimately, the Crosbys defaulted under the contract.

On March 5, 2015, the Court granted VMF's motion for summary judgment as to judicial foreclosure of the land located in Toxey, Alabama. (Doc. 46). As explained in more detail in the Court's previous order, VMF was entitled to sell both the property and the mobile home together through the foreclosure sale. (Doc. 46).

Prior to the foreclosure sale, VMF published a Notice of Mortgage Foreclosure Sale in the Choctaw-Sun Advocate once a week for three successive weeks. (Docs. 47 at 2 and 47-1). VMF also provided written notice of the foreclosure sale to the Defendants. (Doc. 47 at 3). VMF asserts that on May 14, 2015, "[t]he foreclosure sale was conducted in accordance with the requirements of the mortgage, with the requirements of the Court's order of March 5, 2015, and with the requirements of Alabama law." (Doc. 47 at 3).[2] VMF represents to the Court that it made the only and highest bid for the property at the foreclosure sale in the amount of $73, 767.07, and that the auctioneer declared VMF the successful bidder.

Courts have broad discretion in determining whether to confirm or refuse to confirm a judicial sale. See, e.g., Citibank, N.A. v. Data Lease Financial Corp., 645 F.2d 333 (5th Cir.1981); Wood River Dev. v. Armbrester, 547 So.2d 844, 848 (Ala.1989); Lynn v. Dodge, 727 So.2d 89 (Ala.Civ.App.1997); Davis v. Battle, 675 So.2d 460 (Ala.Civ.App.1996). Such determinations ordinarily will not be disturbed except for an abuse of discretion, recognizing the strong public policy in favor of the finality of judicial sales. Id. Generally courts have adopted the policy that confirmation will not be refused except for substantial reasons, and that in the absence of fraud or misconduct, the highest bidder will ordinarily be accepted as the purchaser of the property offered for sale. See, e.g., First Nat. Bank of Jefferson Parish v. M/V Lightning Power, 776 F.2d 1258 (5th Cir.1985); Harduval v. Merchants' & Mechanics' Trust & Savings Bank, 86 So. 52 (Ala.1920) (finding that a purchaser at judicial sale is entitled to have the sale confirmed by the court in the absence of irregularity, misconduct, fraud, mistake, or gross inadequacy of price amounting in itself to fraud). There is no evidence of record of irregularity, misconduct, fraud, mistake or gross inadequacy of price amounting in itself to fraud in the foreclosure sale. Accordingly, VMF's motion to confirm the foreclosure sale is GRANTED IN PART. The foreclosure sale is CONFIRMED.

In addition to confirmation of the sale, VMF also moves the Court to: 1) Award a deficiency balance of $508.11; 2.) Award attorney's fees in the amount of $9, 938.79; 3.) Tax costs of the actions against the Defendants; and 4.) Enter a final judgment on behalf of VMF. The Court addresses each in turn.

A. Deficiency

On February 11, 2015, this Court awarded VMF a judgment in the amount of $70, 416.88, which consisted of the following: $62, 719.17 in unpaid principal; $6, 747.14 in accrued unpaid interest as of December 11, 2014; $388.58 in late charges; and $561.79 in escrow items. (Doc. 43 at 7). Since then, VMF asserts that an additional $2, 964.50 in accrued unpaid interest has incurred and that it is due $882.00 in costs associated with publication of the foreclosure notice. With the additional interest and publication costs included, the amount outstanding totals $74, 275.18. Defendants are due credit in the amount of $73, 767.07 based on the amount VMF paid for the motor home at the foreclosure sale. This leaves a deficiency balance of $508.11.

The Eleventh Circuit has held, "If the sales price at a judicial sale does not fully satisfy a judgment creditor's judgment... the creditor can generally seek a deficiency judgment to recover the balance of the debt. Although courts today generally calculate deficiency judgments as the difference between the total debt and the property's fair market value, they also generally presume that the foreclosure sales price equals the property's fair market value." Redus Florida Commercial, LLC v. Coll. Station Retail Ctr., LLC, 777 F.3d 1187, 1193 (11th Cir. 2014)(internal citations omitted).

The mortgage states, "Lender shall be entitled to collect all expenses incurred in pursuing the remedies provided in this section 22 [Acceleration; Remedies], including, but not limited to reasonable attorneys' fees and costs of title evidence." (Doc. 35-4 at 15). Upon consideration, the Court agrees that VMF is owed a deficiency balance of $508.11.

B. Attorney's Fees and Costs

VMF has requested $9, 938.79 attorney's fees "which represents 15% of [the Crosbys'] unpaid balance at the time that this matter was referred to [] counsel." Generally, the determination of reasonable attorney's fees begins with a determination of the reasonable hourly rate multiplied by the "hours reasonably expended." Bivins v. Wrap It Up, Inc., 548 F.3d 1348, 1350 (11th Cir.2008); Norman v. Housing Authority of City of Montgomery, 836 F.2d 1292, 1303 (11th Cir.1988). When making this "lodestar" determination, the court may consider the twelve factors identified in Pharmacia Corp. v. McGowan, 915 So.2d 549, 552-53 (Ala. 2004) (quoting Van Schaack v. AmSouth Bank, N.A., 530 So.2d 740, 749 (Ala.1988)); see also Bivins, 548 F.3d at 1350 (addressing the twelve factors from Johnson v. Georgia Highway Express, Inc., 488 F.2d 714, 717-719 (5th Cir.1974)). "The product of these two figures is the lodestar and there is a strong presumption that the lodestar is the reasonable sum the attorneys deserve." Bivins, 548 F.3d at 1350 (internal citations and quotation omitted).

In support of its claim for attorney's fees, VMF has submitted the affidavit of VMF Portfolio Manager Brent Ridge. (Doc. ...

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