ENDORSED FILED IN MY OFFICE THIS STATE OF NEW MEXICO COUNTY OF BERNALILLO OCT 16 2017 SECOND JUDICIAL DISTRICT COURT FV-I, INC., IN TRUST FOR MORGAN CLERK DISTRICT COURT STANLEY MORTGAGE CAPITAL HOLDINGS, LLC, Plaintiff, v No. D-202-CV-2014-06681 CHRISTOPHER J, SMITH A/K/A CHRISTOPHER JAMES SMITH A/K/A CHRISTOPHER J. GURULE, STEPHANIE GURULE SMITH, FIRST FINANCIAL CREDIT UNION, RAVI BHASKER, ARNFRIDUR BHASKER, CANVASBACK FINANCIAL SERVICES, LLC, REDBERRY, LLC, AND FRANKS ELECTRIC, LLC, A NEW MEXICO LIMITED LIABILITY COMPANY, Defendants. ORDER ON STATUTE OF LIMITATIONS DEFENSE THIS MATTER came on this Court after entry of the Defendant Christopher Smith's Motion to Dismiss filed herein on September 8, 2017, on the question of whether the statute of limitations precludes Plaintiff's foreclosure action against defendants (Complaint filed Oct. 24, 2014). Having reviewed the briefs and being otherwise fully apprised of the premises, the Court hereby finds and concludes, as follows: 1, Plaintiff's October 24, 2014 complaint filed herein claims that defendant Christopher J. Smith and Stephanie Gurule Smith executed a mortgage note on December 23, 2005 for $252,000.00 in favor of Capital One Home Loans, LLC for a property located at 226 Sierra Place, NE, Albuquerque, New Mexico. Complaint at 46 & 11 ZAAVHO AHLYO2. This note and mortgage were subsequently endorsed over and assigned to CitiMortgage, Inc., and then to Plaintiff herein, who claims to be the appropriate holder of the note and mortgagee; for purposes of this order, Plaintiff is assumed to be the holder in due course of said note and mortgage. Complaint at 48. ‘The complaint further alleges that defendants Christopher J. Smith and Stephanie Gurule Smith are in default on said note and “despite demand, has failed to cure the default. Plaintiff therefore exercised its option in paragraph 6 (c) of the Note and paragraph 22 of the Mortgage to accelerate the outstanding balance of the Note and all other amounts due and owning on the Note as of the date of default and to foreclose the Mortgage.” Complaint at $12 4, Capital One Home Loans, LLC, the original maker of the note, defines “default” as the failure to make a monthly payment when due in these words: “If I do not pay the full amount of each monthly payment on the date it is due, I will be in default.” Complaint at Exhibit A, {6 (B) (Default defined in Note). 5. Default is defined as the “failure to perform, pay, or make good” on an obligation, or “to fail to meet a financial obligation.” Merriam-Webster, Weaster’s THIRD New INTERNATIONAL DICTIONARY OF THE ENGLISH LANGUAGE, Unabridged at 590 (1993). 6. Defendants Smith failed to perform, pay, or make good on the obligation (payment of interest and principal) as early on September 1, 2008, and possibly on October 1, 2008, if we accept Plaintiff's argument that the September 1, 2008 payment was presumably made.7. The language of Paragraph 6(B) is unambiguous; it clearly states that default occurs when the debtor fails to pay the “full amount of each monthly payment on the date it is due.” Complaint at §24. 8. Both the complaint and Plaintiff's motion for summary judgment concede that interest is, due and unpaid as of September 1, 2008, which may be the earliest default date. Complaint at §24 and Motion for Summary and Default Judgment at 3, 41 (filed May 12, 2017) (“The unpaid principal balance on the Note is $243,676.71. Interest has accumulated on the Note since September 1, 2008 at the rate of 6.500% per annum.) 9. Counsel suggested at the hearing and in the motion for summary judgment that “The Note is due for the October 1, 2008 payment...,” apparently on the theory that payment was made on September 1, 2008, and interest begin to accrue on that date but the next payment was not actually due until October 1, 2008. This may be so, but there is lack of support for this position on the present record. 10, Even if Plaintiff's assertion is true, the alternative “default” date would be October 1, 2008; the 6-year limitations period would begin on this date and expire on October 1, 2014; therefore, the limitations period expired, at the latest, 24 days before this action was filed on October 24, 2014. 11, Paragraph 6(¢) of the Note provides: “If I am in default, the Note Holder may send me a written notice telling me that if I do not pay the overdue amount by a certain date, the Note Holder may require me to pay immediately the full amount of the Principal which has not been paid and all the interest that I owe on that amount. That date must be a least30 days after the date on which the notice is mailed to me or delivered by other means.” Complaint, Exhibit A (Note). 12. This language provides that once default occurs, the Note Holder may send a written notice advising of the consequence of default if the amount owed is not paid, and providing that it may immediately declare the entire amount owed. 13. Pl tiff alleges that Paragraph 6(c) of the Note somehow extends or tolls the statute of limitations because it would not begin to run until Plaintiff sends a “written notice” of default. 14, Plaintiff errs because Paragraph 6(c) of the Note merely addresses when the entire amount of the debt may be accelerated, not when the statute of limitations begins to run. 15, Plaintiff may aecelerative the entire balance on the note once the acceleration notice is, issued by the note holder, but this “acceleration date” does not relate to the “default date,” or the occurrence of default, as defined in the terms of the note. 16, Again, the note defines “default,” with this language: “If I do not pay the full amount of each monthly payment on the date it is due, I will be in default.” Complaint at Exhibit A, 46 (B) (Default defined in Note). 17. Defendants Smith failed to pay the full amount of the monthly payment as early as September 1,2008, but certainly no later than, October 1,2008, and therefore Plaintiff was out of time when it filed the complaint over six years later on October 24, 2014, 18, Plaintiff cites to Welty v. Western Bank of Las Cruces, 106 NM. 126 (1987), for the proposition the statute of limitations does not begin to run until 30 days after the giving ofa demand letter to the debtor, which would have the effect of tolling the statute of limitations where the holder delays giving a letter of demand. 19. Welty does not apply to this circumstance because it did not involve interpretation of a mortgage note or the language defining default involved in this case; rather, Welty involved a real estate contract that this distinct policy and contractual considerations. 20. Also, Plaintiff's argument could extend the statute of limitations indefinitely into the future based on the delay of a note holder to submit a demand notice; such a tolling would be inconsistent with the policy, purposes, and clear language of Section 37-1-3. 21. This means that the statute of limit ons in this case began to run on the date of default, not on the date the when the note might be accelerated (for which a factual record was lacking); and the time to file continued for 6 years under Section 37-1-3, NMSA 1978 (provides for a 6-year statute of limitation for claims founded on any promissory note or other contract in writing). 22. The statute of limitations expired six years later on September 1, 2014, or on October 1, 2014, if we accept Plaintiff's alternative theory. 23. Plaintiff was too late and failed to timely file the present action, which makes the note and mortgage unenforceable. IT IS THEREFORE ORDERED, ADJUDGED AND DECREED that Plaintiff's complaint should be, and the same is hereby, DISMISSED WITH PREJUDICE. VICTOR S. LOPEZ VICTOR S. LOPEZ, JUDGE Second Judicial District, Div. XVIIThereby certify that an endorsed copy of the foregoing was emailed & mailed to all parties listed below on the date of filing. imeRESA R. POMERLEAU TCAA to Judge Victor S. Lopez ALL PARTIES ENTITLED TO NOTICE Greenspoon Marder, P.A. Neal D. Gidvani Attorneys for Plaintiff 3993 Howard Hughes Parkway, Suite 400 Las Vegas, Nevada 89169 Telephone: (702) 978-4250 Neal.Gidvani@gmlaw.com Christopher J. Smith Defendant, pro se 1116 Marbie NW Albuquerque, NM 87102 Telephone: (505) 379-2763 chjasmith@gmail.com