Opinion
NO. 14-16-00192-CV
06-13-2017
KENNETH D. EICHNER, P.C., Appellant v. BEN DOMINGUEZ, II, PARC CONDOMINIUM ASSOCIATION, AND ASSOCIATION MANAGEMENT INC., Appellees
On Appeal from the 125th District Court Harris County, Texas
Trial Court Cause No. 2013-21379
MEMORANDUM OPINION
This multi-party dispute centers on the priority of competing liens against a foreclosed condominium. In a previous lawsuit, the condominium association foreclosed on a lien against the condominium due to the owner's non-payment of fees. The condominium owner, Ben Dominguez, II, then filed the present suit against the condominium association for wrongful foreclosure. Dominguez's accounting firm, Kenneth D. Eichner, P.C., intervened in the suit, asserting lien rights of its own allegedly acquired under a promissory note for services rendered to Dominguez and secured by Dominguez's condominium. The accounting firm's petition in intervention asserted a contract claim against Dominguez for his default on the note and asserted rights against all parties under the firm's purportedly superior lien. The condominium association argued that its lien, not the accounting firm's lien, was superior and that the previous foreclosure had extinguished the firm's lien.
The trial court rendered summary judgment against the accounting firm, and the firm appeals. It contends the trial court erred because the firm's lien is superior and the foreclosure proceeding did not extinguish it. The firm also argues that the trial court's judgment, which dismissed the firm's contract claim for Dominguez's default on the note, improperly granted more relief than sought because no party moved to adjudicate that issue.
In this court, two of the three appellees filed a motion to dismiss, challenging our appellate jurisdiction. We carried that motion with the case.
We now deny the motion to dismiss, reverse the trial court's judgment, and remand the case to the trial court for further proceedings.
Background
In this court, appellees are: (1) Dominguez, who owns a condominium located within the Parc IV and V Condominiums ("Parc Condominiums") in Houston, Texas; (2) Parc IV and Parc V Condominium Association ("the Association"), which is the condominium owners' association; and (3) Associated Management, Inc. ("AMI"), which manages the condominium property. In the trial court, Dominguez alleged that the Parc Condominiums were "allowed to deteriorate" to a physical condition necessitating "excessive" repairs, the cost of which the Association passed on to the condominium owners by way of increased monthly assessments. The Association allegedly also requested tens of thousands of dollars in "unanticipated special assessments." Dominguez apparently did not pay some or all of the assessments imposed, and the Association foreclosed on his condominium.
The Association, however, was not the only entity purporting to possess a lien against Dominguez's condominium. Appellant Kenneth D. Eichner, P.C. ("Eichner"), an accounting firm, performed accounting services for Dominguez during or before 2007. In return, Dominguez agreed to pay Eichner roughly $12,000 pursuant to a promissory note and pledged his condominium as collateral for the debt. Dominguez and Eichner executed a Security Agreement and Combined Note ("Security Agreement") to this effect in 2007. The Security Agreement was filed with the county clerk on June 19, 2007.
It is unclear from the record when Dominguez failed to pay the assessments. In 2013, Dominguez sued the Association and AMI for wrongful foreclosure. Eichner intervened and asserted claims against Dominguez and the Association. Specifically, Eichner asserted a breach of contract claim because Dominguez allegedly defaulted on the promissory note. Eichner also alleged that it possessed a valid lien on Dominguez's condominium that was superior to any lien claimed by the Association. Eichner sought relief of "the principal amount due and owing" on the promissory note.
In the argument section of its opening brief, Eichner states that Dominguez "allegedly defaulted on his monthly assessments on or around December 4, 2009." Though neither the Association nor Dominguez have challenged this statement, we are not obligated to accept it as fact. Eichner fails to support its assertion with record references and our independent review of the record reveals no summary judgment evidence to support the assertion. Further, as Eichner was not in a position to have first-hand knowledge of when Dominguez defaulted on his monthly assessments, we are not inclined to accept Eichner's statement as established fact absent summary judgment proof.
Dominguez, the Association, and AMI filed a joint motion for summary judgment ("Joint Motion"), arguing that the Association's lien was superior to Eichner's lien and that the Association's foreclosure judgment extinguished Eichner's lien. More particularly, the Joint Motion argued that the Association's lien was first in time, and thus superior to Eichner's alleged lien, because it was created when the condominium declaration was filed in 1978. The Joint Motion did not address Eichner's cause of action against Dominguez for breach of the promissory note and related relief. The only evidence attached to the Joint Motion was a business records affidavit and a copy of the Association's declaration.
A "declaration" is any instrument, however denominated, that creates a condominium regime, as well as any amendment to such instrument. See Tex. Prop. Code § 82.003(11).
The trial court granted the Joint Motion and held that the Association's lien was superior to Eichner's lien. The trial court also held that Eichner's lien was extinguished by the Association's foreclosure and, due to Eichner's failure to object or redeem its lien, Eichner's lien was no longer attached to the property.
Dominguez later moved for final judgment, stating that Dominguez and the Association had entered into a Rule 11 agreement resolving all of Dominguez's claims. Because, Dominguez believed, the trial court previously "resolve[d] the claims brought forward by [Eichner]," Dominguez contended that "[t]here are no more legal issues to resolve" and asked the court to render a final judgment as to the entire case.
The trial court granted Dominguez's motion for judgment and signed a final judgment. In substantive part, the judgment ordered: (1) the Association to transfer the condominium title to Dominguez; (2) Eichner to remove the lis pendens filed with the county clerk; (3) the county clerk to "remove from it[s] records or reflect as extinguished and no longer valid, the Security Agreement and Combined Note filed by [Eichner] on June 19th, 2007"; and (4) Dominguez to pay the Association roughly $42,000 in satisfaction of the Rule 11 agreement and assessment arrearages.
Eichner appeals the summary judgment and final judgment.
Motion to Dismiss
Before we consider the merits of Eichner's appeal, we first address a motion to dismiss filed by the Association and AMI because it implicates this court's appellate jurisdiction. See Lapiner v. Maimon, 429 S.W.3d 816, 820 (Tex. App.—Houston [14th Dist.] 2014, pet. denied). The Association and AMI moved to dismiss Eichner's appeal for want of jurisdiction, contending that Eichner's lien is void as a matter of law because Eichner did not seek to enforce its lien within the applicable limitations period set forth in Texas Civil Practice and Remedies Code section 16.035. We disagree that this limitations argument impairs our jurisdiction.
The undisputed facts establish that the Security Agreement collateralizing the condominium was executed on June 6, 2007, and filed on June 19, 2007. Pursuant to the Security Agreement, Dominguez was obligated to pay the debt owed to Eichner no later than June 6, 2008. The Association and AMI—non-parties to the Security Agreement—contend that the Security Agreement became void on June 6, 2012, citing Texas Civil Practice and Remedies Code section 16.035. See Tex. Civ. Prac. & Rem. Code § 16.035(d) ("On the expiration of the four-year limitations period, the real property lien and a power of sale to enforce the real property lien become void."). The Association and AMI contend that Eichner did not bring suit for the recovery of real property or to foreclose on the lien within four years of the Security Agreement's maturity date. Thus, they argue, the lien is void as a matter of law and this court lacks jurisdiction because there is no live controversy.
In response, Eichner argues that the Security Agreement remained effective at least until November 2013, in part because Dominguez allegedly acknowledged the debt in December 2009. Eichner also argues that the Association's and AMI's limitations argument—that Eichner's lien is void because its attempt to enforce it was untimely—is waived for failure to raise it in the trial court. We agree with Eichner's latter assertion.
According to the motion to dismiss, Eichner's alleged lien is void. The sole rationale offered in support of appellees' position is that the alleged lien became void by the passage of time due to Eichner's failure to assert his lien rights within the applicable limitations period. The statute of limitations, however, is an affirmative defense. See Trelltex, Inc. v. Intecx, L.L.C., 494 S.W.3d 781, 785 (Tex. App.—Houston [14th Dist.] 2016, no pet.). It is waived if not timely pleaded or tried by consent. See Tex. R. Civ. P. 94; Frazier v. Havens, 102 S.W.3d 406, 411 (Tex. App.—Houston [14th Dist.] 2003, no pet.). Further, a party may not raise a limitations defense for the first time on appeal. See Caston v. Wiley, No. 14-14-01001-CV, 2016 WL 3131666, at *5 (Tex. App.—Houston [14th Dist.] June 2, 2016, no pet.) (mem. op.) (holding that limitations cannot be raised for the first time on appeal).
Assuming without deciding that the Association and AMI have standing to assert limitations as an affirmative defense to Eichner's claims, they did not raise the defense below. In the trial court, the Association and AMI never contended that Eichner's lien was void due to Eichner's alleged failure to enforce it during a limitations period. Nor did they assert, or prove, that Eichner's intervention to assert its lienholder rights was barred as untimely. Appellees did not raise these arguments in their summary judgment motion or pleadings, nor did they direct the trial court to the Civil Practice and Remedies Code limitations provision on which their motion to dismiss is based. Being grounded on a limitations argument, the issues raised in the motion to dismiss do not implicate our appellate jurisdiction. See, e.g., Dubai Petroleum Co. v. Kazi, 12 S.W.3d 71, 76-77 (Tex. 2000) (explaining distinction between right of plaintiff to relief and jurisdiction of court to afford it). We will not construe an unpreserved limitations defense as a jurisdictional obstacle to addressing Eichner's appellate issues.
Accordingly, we deny the Association's and AMI's motion to dismiss.
Analysis
We next turn to the merits of Eichner's appeal. Eichner's issues on appeal can be reduced to four essential points:
(1) the Association, as the summary judgment movant, failed to prove that it possessed a valid lien because it presented no evidence that Dominguez failed to pay any assessments, or the date of non-payment;
(2) the Association also did not meet its summary judgment burden to prove that any lien it possessed was superior to Eichner's lien;
(3) alternatively, assuming the Association possessed lien rights superior to Eichner's lien rights, the Association failed to prove that it conducted the foreclosure in accordance with the deed of trust and Texas Property Code because the Association presented no evidence that it gave Eichner notice of the foreclosure proceedings; and
(4) in all events, the trial court erred in disposing of Eichner's cause of action against Dominguez for breach of the note because no party moved for summary judgment on that claim.
Because our determination of Eichner's second issue as stated above is dispositive and grants the greatest relief, we need not address his remaining issues. See Tex. R. App. P. 47.1.
A. Standard of Review
Eichner argues that the trial court erred in granting the Joint Motion, including by ruling that the Association's lien was superior to Eichner's and that Eichner's lien was extinguished.
We review a trial court's grant of summary judgment de novo. Exxon Corp. v. Emerald Oil & Gas Co., 331 S.W.3d 419, 422 (Tex. 2010). A motion for summary judgment is properly granted if the movant establishes that there is no genuine issue of material fact and that he or she is entitled to judgment as a matter of law. Tex. R. Civ. P. 166a(c); Gastar Exploration Ltd. v. U.S. Specialty Ins. Co., 412 S.W.3d 577, 582 (Tex. App.—Houston [14th Dist.] 2013, pet. denied). Every reasonable inference must be indulged in favor of the non-movant and any doubt resolved in its favor. Gonzalez v. Mission Am. Ins. Co., 795 S.W.2d 734, 736 (Tex. 1990).
A movant seeking a traditional summary judgment must establish its right to that relief by conclusively proving all elements of the movant's claim or defense as a matter of law. See Tex. R. Civ. P. 166a(c); Havlen v. McDougall, 22 S.W.3d 343, 345 (Tex. 2000). If the movant's motion and summary judgment evidence facially establish its right to judgment as a matter of law, the burden shifts to the non-movant to raise a genuine, material fact issue sufficient to defeat summary judgment. Dolcefino v. Randolph, 19 S.W.3d 906, 916 (Tex. App.—Houston [14th Dist.] 2000, pet. denied). On the other hand, if the movant fails to meet its initial summary judgment burden, the summary judgment cannot stand regardless whether the non-movant responds. See Grynberg v. Grey Wolf Drilling Co., 296 S.W.3d 132, 137 & n.13 (Tex. App.—Houston [14th Dist.] 2009, no pet.) (summary judgment must stand on its own merits; non-movant has no burden to respond unless movant conclusively establishes entitlement to summary judgment); see also City of Houston v. Clear Creek Basin Auth., 589 S.W.2d 671, 678 (Tex. 1979) ("Summary judgments must stand on their own merits, and the non-movant's failure to answer or respond cannot supply by default the summary judgment proof necessary to establish the movant's right."); Williams Consol. I, Ltd./BSI Holdings, Inc. v. TIG Ins. Co., 230 S.W.3d 895, 900 (Tex. App.—Houston [14th Dist.] 2007, no pet.) (it is the movant's burden to conclusively prove all elements of its claim or defense); Garcia v. John Hancock Variable Life Ins. Co., 859 S.W.2d 427, 430 (Tex. App.—San Antonio 1993, writ denied) ("Unless the movant/defendant conclusively establishes its affirmative defense, the non-movant/plaintiff has no burden in response to a motion for summary judgment filed on the basis of an affirmative defense.").
B. Summary Judgment on Lien Priority
In the Joint Motion, appellees argued that the Association's lien was superior to Eichner's because the Association's lien was created upon the filing of the declaration creating the Parc Condominiums in 1978 and attached continuously thereafter. Appellees also argued that Eichner's inferior lien was extinguished by the Association's foreclosure on its lien. The trial court agreed and granted the Joint Motion.
The question for this court is whether appellees established as a matter of law that the Association had a valid lien and that its lien was superior to Eichner's lien. Eichner and the Association each had liens on Dominguez's condominium. Generally, different liens upon the same property are prioritized according to the time of their creation. See Red Rock Props. 2005, Ltd. v. Chase Home Fin., L.L.C., No. 14-08-00352, 2009 WL 1795037, at *3 (Tex. App.—Houston [14th Dist.] June 25, 2009, no pet.) (mem. op.). This rule is known as "first in time is first in right." Id. (quotation omitted); see also Cervantes v. Bayview Loan Servicing, LLC, No. 14-12-00157-CV, 2012 WL 6017712, at *2 (Tex. App.—Houston [14th Dist.] Dec. 4, 2012, no pet.) (mem. op.) (same); Williams v. Nationstar Mortg., LLC, 349 S.W.3d 90, 93 (Tex. App.—Texarkana 2011, pet. denied) (same).
Here, the parties do not dispute that Eichner's lien attached when Eichner filed its UCC financing statement on June 19, 2007. See Tex. Bus. & Com. Code § 9.312. But the parties dispute when the Association's lien attached—in 1978 when the Association's declaration was recorded, or subsequently when Dominguez defaulted on the monthly assessments. There is no conclusive evidence in the record indicating when Dominguez defaulted on the assessments. Eichner contends that the default occurred on or around December 4, 2009, but offers no supporting evidence. The Association also did not offer evidence of Dominguez's default. However, the Association's theory underlying the Joint Motion is that its lien attached in 1978 as a matter of law when the declaration was filed, regardless when Dominguez defaulted. The trial court agreed. If this conclusion is error, summary judgment for appellees was improper.
As noted above, the only evidence attached to the Joint Motion was a business records affidavit and a copy of the Association's declaration.
1. Creation and priority of liens under the common law
In Inwood, the Supreme Court of Texas determined the priority of competing interests on the same property. See Inwood N. Homeowners' Ass'n, Inc. v. Harris, 736 S.W.2d 632 (Tex. 1987). The issue of lien priority arose in the context of a conflict between a homeowners' association's declaration that created assessment liens and a homeowner's homestead rights in the same property. Id. at 633-34. The Inwood court held that the association's interest was superior to the homeowner's homestead rights because the association's assessment lien attached when the original declaration was filed, before the homeowners took title, and because the assessment lien ran with the land. Id. at 635-36. In determining when the assessment lien attached, the Inwood court looked to the parties' agreement in the original declaration, which created continuing assessment liens on the date of the declaration. See id. at 634-35.
Though the text of the declaration in Inwood is not quoted in that opinion, the court stated:
Under Article IV of the declaration, each person receiving a deed for a lot in the subdivision "is deemed to covenant and agree to pay the Association the following: (a) annual assessment or charges; and (b) special assessments for capital improvements." These assessments, plus interest and costs of collection, were designated to be "a charge on the land and shall be secured by a continuing Vendor's Lien upon the Lot against which such assessments or charges are made."Inwood, 736 S.W.2d at 633.
This court later addressed a question of lien priority in Red Rock, when we distinguished Inwood and concluded that a condominium association's declaration created an assessment lien only upon default of the monthly assessments, not on the declaration's filing date. See Red Rock, 2009 WL 1795037, at *4-5. The declaration in Red Rock provided:
All common monthly assessments and special assessments assessed but unpaid by a Unit Owner for its share of Common Expenses chargeable to its respective Condominium Unit, including interest thereon at ten percent (10%) per annum, plus any attorney's fees incurred by the Association in order to enforce compliance by any Owner with the terms of this Declaration, the By-Laws, Articles of Incorporation, or Rules and Regulations of the Association, shall constitute a lien on such Unit superior (prior) to all other liens and encumbrances. . . .Id. at *4 (emphasis original). From this, the court concluded that the parties' "clear and explicit intention . . . is that the act of nonpayment gives rise to an assessment lien; nothing . . . in the Declaration suggest[s] that an assessment lien relates back to a previously recorded document or the date on which the Declaration was signed or recorded." Id.
As in Inwood and Red Rock, we must look to the Association's declaration in the instant case to determine whether the assessment lien attached when the declaration was filed in 1978 or when Dominguez defaulted on the monthly assessments.
Section 10(a) of the declaration provides in pertinent part:
If any Unit Owner shall fail or refuse to make any such payment of the common expenses when due, the amount thereof together with interest thereon at the maximum rate as may then be permitted under the law of the State of Texas, accruing from and after the date that said common expenses become due and payable, shall constitute a lien on the interest of such Unit Owner in the Property and his Unit.(Emphases added).
Under section 10(a) of the declaration, it is the assessment deficiency—"the amount thereof" resulting from the Unit Owner's "fail[ure] or refus[al] to make any such payment of the common expenses when due"—that constitutes a lien on the property. Accordingly, we follow, as we must, this court's binding precedent in Red Rock and hold that the Association's declaration gives rise to a lien only upon default of the monthly assessments. See Red Rock, 2009 WL 1795037, at *4-5. Therefore, the Association's assessment lien did not attach when the declaration was filed in 1978. Rather, it attached upon Dominguez's non-payment of the monthly assessments. Because we cannot discern from the record when that default occurred, we cannot determine whether Eichner or the Association is the superior lienholder. Based on the primary argument presented in the Joint Motion—i.e., that the Association's lien dated back to the 1978 declaration—we conclude that the trial court erred in granting the Joint Motion because the movants did not conclusively establish that the Association's lien attached in 1978.
2. Creation and priority of liens under the Property Code
Appellees alternatively argue that section 82.113 of the Texas Property Code dictates that the Association's lien dated back to the 1978 declaration. That section provides, in pertinent part:
An assessment levied by the association against a unit or unit holder is . . . secured by a continuing lien on the unit. . . .Tex. Prop. Code § 82.113(a), (c).
The association's lien for assessments is created by recordation of the declaration, which constitutes record notice and perfection of the lien. Unless the declaration provides otherwise, no other recordation of a lien or notice of lien is required.
While Chapter 82 generally applies only to condominium regimes for which the declaration is recorded on or after January 1, 1994, the Legislature specified that certain sections apply to condominium regimes for which the declaration was recorded before January 1, 1994, like the Parc Condominiums. Tex. Prop. Code § 82.002(a), (c). Section 82.002 makes clear that section 82.113 applies to a condominium regime with a pre-1994 declaration. Id. § 82.002(c) ("This section and the following sections apply to a condominium in this state for which the declaration was recorded before January 1, 1994: . . . [section] 82.113. . . ."); see also Bagelman v. Peach, No. 03-10-00406-CV, 2011 WL 2462026, at *5 (Tex. App.—Austin June 16, 2011, no pet.) (mem. op.) ("[T]he Legislature has expressly made section 82.113 applicable to pre-1994 condominium regimes that would otherwise be governed by chapter 81."). Section 82.002 also makes clear, however, that section 82.113 "do[es] not invalidate existing provisions of the declaration . . . of a condominium for which the declaration was recorded before January 1, 1994." Tex. Prop. Code § 82.002(c).
We hold that, while generally applicable to the Parc Condominiums, section 82.113 does not operate to invalidate section 10(a) of the Association's 1978 declaration, which makes clear that the Association's lien attaches at the point of delinquency. See Riner v. Neumann, 353 S.W.3d 312, 317 (Tex. App.—Dallas 2011, no pet.) (lien-priority issue governed by terms of pre-1994 declaration and not by section 82.113: "applying [section 82.113] in this case would invalidate the declaration's contrary provision that assessment liens attach only when assessments become delinquent"); accord Bagelman, 2011 WL 2462026, at *3 (section 82.113 provides that liens are "created and perfected by recording the declarations unless otherwise provided in the declarations").
3. Priority of liens under the governing documents
Appellees also argue that, if we conclude that the Association's assessment lien accrues only upon default and does not relate back to the 1978 declaration, then our interpretation of the declaration will conflict with, and render meaningless, the Association's bylaws.
Appellees point to section 7 of the bylaws, which states:
If any Unit Owner shall fail or refuse to make any such payment of the common expenses when due, the amount thereof together with interest thereon at the maximum lawful rate of interest per annum after said common expenses become due and payable, shall constitute a lien, as provided in the Declaration, enforceable by the Board, on the interest of such Unit Owner in the Property; provided, however, that such lien shall be subordinate to the lien of a prior recorded first Mortgage on the interest of such Unit Owner . . . .
Appellees argue that an assessment lien accruing only upon default would render redundant the language in the bylaws stating, ". . . provided, however, that such lien shall be subordinate to the lien of a prior recorded first Mortgage on the interest of such Unit Owner," because a first mortgage would already have priority over a subsequent assessment lien created by an owner's default.
We first note that redundancies do not necessarily render an interpretation of a contract erroneous or invalid. See Phila. Indem. Ins. Co. v. White, 490 S.W.3d 468, 477 (Tex. 2016) ("Though we strive to construe contracts in a manner that avoids rendering any language superfluous, redundancies may be used for clarity, emphasis, or both."); accord also Kelley-Coppedge, Inc. v. Highlands Ins. Co., 980 S.W.2d 462, 469 (Tex. 1998) (Gonzalez, J., dissenting) ("It is not uncommon for contracts to have redundant terms, expressions[,] and provisions.").
Moreover, the bylaws' provision that a first-mortgage lienholder will have a superior lien is consistent with the declaration's provision that an assessment lien does not accrue until default. An assessment lien may be superior to other liens, but will never be superior to a first-mortgage lien, as a specific carve-out in the bylaws. We find nothing in appellees' textual argument to convince us to reconsider our interpretation of the declaration as dictated by this court's precedent in Red Rock.
We note that in neither of the two briefs filed in this court, nor in any response filed below, do appellees address Red Rock, despite Eichner's repeated and substantial reliance on it.
4. Priority of liens as evidenced by legislative intent
Appellees also argue that one of the Legislature's motivations in passing the Uniform Condominium Act—which includes section 82.113, discussed above—was to make it easier for national lenders to assess the propriety of condominium documents and financing. Assuming arguendo that appellees are correct and that this court's interpretation of the Association's declaration may be guided by legislative intent, we nevertheless do not find appellees' argument persuasive.
Appellees contend that an assessment lien created upon default would create an inconsistent lien priority structure because it would give rise to numerous additional issues, such as "what constitutes non-payment, what notice of non-payment is required to establish a lien right, and whether a lien right created by non-payment is continuous or subject to extinguishment if the assessments are then paid."
We disagree. Lien priority and perfection are adequately governed by the Uniform Commercial Code, as adopted in the Texas Business and Commerce Code, and by more specific provisions in the Property Code. See Sw. Bank v. Info. Support Concepts, Inc., 149 S.W.3d 104, 106 n.3 (Tex. 2004) (Texas version of the UCC is codified in the Business and Commerce Code); see also generally Tex. Bus. & Com. Code ch. 9 ("Secured Transactions"); Tex. Prop. Code chs. 81 and 82 (statutory scheme governing condominiums, including assessment liens). To the extent that condominium associations are unclear about "what constitutes non-payment" and the Association's other stated concerns, these issues may be resolved by declaration amendments. Indeed, a condominium association with a pre-1994 declaration may expressly state in the declaration or an amendment that an assessment lien is created upon filing of the declaration or may omit any language in the declaration regarding creation of the lien—in which case, section 82.113 would apply. See Tex. Prop. Code § 82.002(c) (section 82.113 will apply to a condominium with a pre-1994 declaration so long as the statute does not invalidate existing provisions of the declaration).
* * *
For all the reasons above, we conclude that the trial court erred in granting the Joint Motion on the ground that Eichner's lien was inferior to the Association's lien. Because the other grounds presented in the Joint Motion—i.e., that the foreclosure extinguished Eichner's lien and that Eichner failed to redeem its extinguished lien—were predicated on the erroneous premise that the Association's lien was superior, there are no grounds on which the summary judgment may be affirmed. See Vaughn v. Moulton, No. 14-95-01467-CV, 1997 WL 128543, at *3 (Tex. App.—Houston [14th Dist.] Mar. 20, 1997, no writ) (op. on reh'g, not designated for publication).
While a valid foreclosure on a senior lien extinguishes a junior lien (if there are not sufficient proceeds to satisfy the junior lien), foreclosure on a junior lien generally will not extinguish a senior lien. See I-10 Colony, Inc. v. Chao Kuan Lee, 393 S.W.3d 467, 472-73 (Tex. App.—Houston [14th Dist.] 2012, pet. denied).
We sustain Eichner's second issue.
Conclusion
In conclusion, we deny the Association's and AMI's motion to dismiss Eichner's appeal for want of jurisdiction. Having sustained Eichner's appellate issue warranting the greatest relief, we reverse the trial court's summary judgment order signed February 5, 2015, and reverse the following paragraphs of the final judgment:
It is further . . .No party has challenged the remainder of the final judgment.
DECREED, ADJUDGED, AND ORDERED that the Intervenor is ordered to sign and [sic] any and all documents necessary to remove the Lis Pendens he has filed with Stan Stannart [sic] Harris County Clerk as part of this litigation and to sign and file any and all documents necessary to remove the lien by which the Intervenor based his intervention on in this litigation filed with the Harris County Clerk[']s Office on June 19th[,] 2007 as the Court has found this lien to be extinguished by the Defendant's foreclosure of the property occurring on or about June 4th[,] 2013. It is further,
DECREED, ADJUDGED, AND ORDERED that Harris County Clerk Stan Stannart [sic] or his representative or employees remove from it[s] records or reflect as extinguished and no longer valid, the Security Agreement and Combined Note filed by Ken Eichner on June 19th[,] 2007 naming Ben Dominguez, II as the debtor in the amount of $12,165.21 and identifying Unit 1004, Bldg A, .004178 Int Common Land & Ele, Parc IV and Parc V Condo at 3614 Montrose B[l]vd., Houston, Texas 77006 as collateral. . . .
We remand the case for further proceedings in accordance with this opinion.
/s/ Kevin Jewell
Justice Panel consists of Justices Christopher, Busby, and Jewell.