N.C. Court of Appeals: Devane v. Aurora Loan Services, LLC- Bases for Foreclosure Must be Challenged at Foreclosure or on Appeal

Summary: In 2006, Devane executed a promissory note and Deed of Trust in favor of Aurora. Aurora subsequently, erroneously asserted that Devane violated the repayment terms of the note on six occassions. In September 2010, an agent of Aurora informed Devane that it had misapplied payments made by Devane to another account. At that time, Devane was place on a new payment plan, but her original payments were still not applied. In December 2010, Aurora induced Devane to apply for a HAMP modification to “make up for any mix-up”, but instructed Devane that she should not make payments while the HAMP modification was being developed. Despite telling Devane that the loan modification was a “sure thing”, Aurora commenced foreclosure. Aurora then told Devane the foreclosure hearing would be postponed, but it nonetheless went forward, with Devane present and the clerk of court finding that all requirements for the foreclosure had been met and Aurora, despite other promises to postpone the foreclosure sale and consummate the loan modification, purchased the property at the foreclosure sale on November 23, 2011. Devane then brought suit on March 12, 2012, alleging numerous causes of action against Aurora, including breach of contract, unfair and deceptive trade practices, negligent misrepresentation, etc., but the trial court, following Devane’s admission that she had failed to timely appeal the foreclosure, granted Aurora’s motion to dismiss. The Court of Appeals affirmed, holding that, since the Clerk of Court had found that that Aurora met the requirements for foreclosure, because of Devane’s failure to timely appeal this order or to assert an action in equity to enjoin the foreclosure “the rights of the parties became fixed at the close of the upset period, and [Devane had] no further legal or equitable recourse. See N.C. Gen. Stat. § 45-21.29A; Goad v. Chase Home Fin., LLC, 208 N.C. App. 259, 263, 704 S.E.2d 1, 4 (2010)\, Haughton v. HSBC Banks USA, __ N.C. App. __, 737 S.E.2d 191 (2013) (unpublished opinion). Commentary: A discussion of Haughton v. HSBC Banks USA is available here: http://ncbankruptcyexpert.com/?p=1210 For a copy of the opinion, please see: Devane v. Aurora Loan Services, LLC- Bases for Foreclosure Must be Challenged at Foreclosure or on Appeal