Fifth Circuit tells pro se foreclosure plaintiffs in 2nd appeal that their claims shall remain in federal court after removal from state court

Mr. and Mrs. Smith go to the Fifth Circuit once more. U.S. District Court's denial of their motion to remand the case to state court affirmed on finding that their less than lawyerly pro se pleadings invoked the FDCPA. 

 OWEN M. SMITH; DANA NORWOOD SMITH, Plaintiffs-Appellants,

v.
BARRETT DAFFIN FRAPPIER TURNER & ENGEL, L.L.P.; STEPHEN C. PORTER; G. TOMMY BASTIAN; NDEX TITLE SERVICES, L.L.C.; BANK OF AMERICA, N.A.; FEDERAL NATIONAL MORTGAGE ASSOCIATION; THE REGISTERED HOLDERS OF FANNIE MAE GUARANTEED REMIC PASS-THROUGH CERTIFICATES, Fannie Mae REMIC TRUST 2008-16; FNMA AA MSTR/SUB CW BANK; LAURIE MEDER; FANNIE MAE REMIC TRUST 2008-16, Defendants-Appellees.

No. 16-51010.

United States Court of Appeals, Fifth Circuit.

Filed June 12, 2018.

Mark D. Hopkins, for Defendant-Appellee.

David Andrew Rogers, for Plaintiff-Appellant.

Richard Dwayne Danner, for Defendant-Appellee.

Nathan Templeton Anderson, for Defendant-Appellee.

Thomas Mott Hanson, for Defendant-Appellee.

William D. Davis, for Plaintiff-Appellant.

Shelley Luan Hopkins, for Defendant-Appellee.

Appeal from the United States District Court for the Western District of Texas, USDC No. 1:13-CV-193.

Before: SMITH, WIENER, and WILLETT, Circuit Judges.

PER CURIAM.^[*]

The Smiths appeal the district court's denial of their motion to remand their case to state court. They claim the district court lacks subject-matter jurisdiction. We disagree.

I

This is the second time this case has come before our court. See Smith v. Bank of Am. Corp., 605 F. App'x 311 (5th Cir. 2015). A brief recap is in order.^[1]

In February 2013, the Smiths filed their original petition in Texas state court. Their allegations focused on an attempted non-judicial foreclosure on their property in Austin, Texas. See id. at 312. The Defendants were financial institutions and entities involved with processing the foreclosure. "The precise nature of the Smiths' claims was unclear." See id. at 312-13.

The Defendants removed the case to federal court.^[2] "The Smiths did not move to remand the case to state court." Id. at 313. Soon after, the district court granted the Defendants' respective motions to dismiss for failure to state a claim and entered final judgment. The Smiths timely appealed.

Our court declared that the district court failed to assess whether it possessed subject-matter jurisdiction over the Smiths' claims. See id. at 312. Accordingly, we vacated the district court's judgment and "remand[ed] the case with instructions to decide the threshold jurisdictional issue." Id.

Following our opinion, the Smiths filed a motion to remand their case to state court. The Defendants responded, asserting the district court could exercise federal-question jurisdiction or, in the alternative, diversity jurisdiction.

A magistrate judge concluded that "both diversity jurisdiction and federal-question jurisdiction existed at the time of removal" and recommended the district court assert subject-matter jurisdiction over the case.^[3] The district court agreed, concluding both federal-question and diversity jurisdiction existed.

Accordingly, the court denied the Smiths' motion for remand. The Smiths timely appealed.

II

Reviewing subject-matter jurisdiction de novo, Gasch v. Hartford Acc. & Indem. Co., 491 F.3d 278, 281 (5th Cir. 2007), we find the Smiths stated a federal cause of action on the face of their original complaint. Thus, the district court properly exercised subject-matter jurisdiction.^[4]

Before addressing the jurisdictional issue, we address an argument framing the Smiths' appeal: They ask for leeway in how we interpret their pro se pleadings.^[5] It is well-settled that our court holds pro se pleadings to "less stringent standards than formal pleadings drafted by lawyers." Taylor v. Books A Million, Inc., 296 F.3d 376, 378 (5th Cir. 2002)(quoting Miller v. Stanmore, 636 F.2d 986, 988 (5th Cir. Unit A Feb. 1981)). And we "liberally construe[] pro se briefs" in the interest of justice. Wiggins v. La. State Univ.-Health Care Servs. Div., 710 F. App'x 625, 628 (5th Cir. 2017) (citing Yohey v. Collins,985 F.2d 222, 225 (5th Cir. 1993)); Barksdale v. King, 699 F.2d 744, 746 (5th Cir. 1983)("[The plaintiff] is a pro se litigant. It is established that his pleadings, therefore, are to be liberally construed.").

Yet, there are limits on how far we will go to assist pro se plaintiffs. These litigants must still satisfy the plausibility pleading standard. See Taylor, 296 F.3d at 378 ("[R]egardless of whether the plaintiff is proceeding pro se or is represented by counsel, `conclusory allegations or legal conclusions masquerading as factual conclusions will not suffice to prevent a motion to dismiss.'" (quoting S. Christian Leadership Conference v. Supreme Court of La., 252 F.3d 781, 786 (5th Cir. 2001))). And pro se litigants "must still brief the arguments in order to preserve them," otherwise, their arguments will be considered waived on appeal. See Wiggins, 710 F. App'x at 628 (citing Yohey, 985 F.2d at 225). We seek to balance access to justice for pro se litigants with fairness to defendants and the interests of judicial economy. With that in mind, we proceed to the jurisdictional determination.

A

District courts have "original jurisdiction of all civil actions arising under the Constitution, laws, or treaties of the United States."^[6] To exercise this flavor of jurisdiction, a federal question must "appear[] on the face of the plaintiff's well-pleaded complaint." See Elam v. Kan. City S. Ry. Co., 635 F.3d 796, 803 (5th Cir. 2011) (citing Bernhard v. Whitney Nat'l Bank, 523 F.3d 546, 551 (5th Cir. 2008)).

This scheme empowers the plaintiff to decide whether her case ends up in federal court. The "plaintiff is the master of his complaint and may allege only state law causes of action, even when federal remedies might also exist." Elam, 635 F.3d at 803 (citing Bernhard, 523 F.3d at 551). And if she pleads only state-law claims, there is no basis for federal-question jurisdiction. See id. (citing Gutierrez v. Flores, 543 F.3d 248, 252 (5th Cir. 2008)).^[7]

If a district court can exercise original federal-question jurisdiction over an action, then a federal court may exercise removal jurisdiction over that action. Id. (citing 28 U.S.C. § 1441(a)). The complaint establishes the basis for removal. Franchise Tax Bd. of Cal. v. Constr. Laborers Vacation Tr. for S. Cal., 463 U.S. 1, 10-11 (1983). Courts determine whether removal is proper by evaluating "the complaint at the time the petition for removal is filed." Brown v. Sw. Bell Tel. Co., 901 F.2d 1250, 1254 (5th Cir. 1990) (citation omitted); see also Louisiana v. Am. Nat'l Prop. & Cas. Co., 746 F.3d 633, 636 (5th Cir. 2014) ("[J]urisdictional facts are determined at the time of removal, and consequently post-removal events do not affect that properly established jurisdiction." (citing Grupo Dataflux v. Atlas Global Grp., L.P., 541 U.S. 567, 569-70 (2004))).

"The removing party bears the burden of showing that federal jurisdiction exists and that removal was proper." Manguno v. Prudential Prop. & Cas. Ins. Co., 276 F.3d 720, 723 (5th Cir. 2002) (citing De Aguilar v. Boeing Co., 47 F.3d 1404, 1408 (5th Cir. 1995)). "Any ambiguities are construed against removal because the removal statute should be strictly construed in favor of remand." Id. (citing Acuna v. Brown & Root, Inc., 200 F.3d 335, 339 (5th Cir. 2000)).

B

We look to the operative pleading when the Defendants moved for removal: the Smiths' original complaint. The Defendants direct us to specific portions of the original complaint that, according to them, substantiate their claim that the Smiths alleged^[8] a federal cause of action under the federal Fair Debt Collection Practices Act.^[9]

In the "Facts" section,^[10] the Smiths wrote:

17. In April, 2009 BANK OF AMERICA CORPORATION claimed to be the new mortgage servicer and payments were to be made to them. BANK OF AMERICA CORPORATION was not an "original party" to the "original negotiable instrument" which the "borrowers" negotiated. BANK OF AMERICA CORPORATION was a 3rd party debt collector, pretending to be the Lender. BANK OF AMERICA CORPORATION failed to adhere to the Fair Debt Collection Practice Act, as all 3rd party debt collectors are required to do.

In the next paragraph, after describing the conduct of Countrywide Financial Corporation—which later merged with Bank of America—they wrote: "The Supreme Court has warned people in Federal Crop Insurance Corp vs. Merrill and Title 15 Section 1692 that when people enter into any dealings with agents, the people better investigate the authority and limits of authority that the agents possess." The Smiths repeat this language in other paragraphs that describe the conduct of other Defendants, such as Barrett Daffin, MERS, BAC Home Loans Servicing, Bastian, NDEX Title Services, and Porter. The Smiths believe the conduct amounts to "a foreclosure mill style shell game preying on Texans by intimidation and lawyering."

In the "Conclusion" section, the Smiths stated: "When the Court takes into account the Statutes and Case Law and applies them to the facts of this case . . . it is clear why it is necessary for agency authorization from the principal [to] be proved by any mortgage servicer, lawyer, employee or assignee. No such evidence exists." And the Smiths criticized the "action by 3rd parties . . . [that] has rendered the security instrument a nullity, leaving only an unsecured indebtedness of the negotiable instrument that could only be enforced by the original Creditor through legal avenues."

Finally, in the "Prayer for Relief" section, the plaintiffs repeated their description of the Defendants' activities as a "type of predatory enterprise which involves fraud and relentless lawyering on unsuspecting Texans." This section did not allege a specific cause of action. Instead, after requesting "a hearing," "discovery," and an injunction to prevent foreclosure on the Smiths' property, the Smiths issued a broad prayer for monetary relief. Their prayer included, among other requests:

• "Damages in an amount not to exceed the jurisdictional limits of this Court";

• "Economic Damages";

• "Additional Treble Damages for all intentional and knowing violations"; and

• "All other relief to which [the Smiths] are entitled."

We find that it is apparent from the face of the complaint that the Smiths alleged a federal-law cause of action: a claim for relief under the federal Fair Debt Collection Practices Act, 15 U.S.C. § 1692. The Smiths alleged that Bank of America, a Defendant, "failed to adhere to the Fair Debt Collection Practice Act, as all 3rd party debt collectors are required to do." This may be read as an attempt to invoke a federal statute.^[11]

In response, the Smiths claim they intended to invoke only "the Texas Debt Collection Act." We agree that they alleged a violation of Texas law by asserting^[12] "[a]ll Defendants . . . carried out a collection action by way of the foreclosure and Substitute Trustee's Non-Judicial Foreclosure Sale in violation of the Texas Finance Code sections 392.301(8) and 392.304 and other various State laws."

But we do not agree that this reference to the Texas Finance Code demonstrates the Smiths did not also allege a free-standing federal Fair Debt Collection Practices Act claim.

After asserting that Bank of America "was a 3rd party debt collector" that "failed to adhere to the Fair Debt Collection Practice Act, as all 3rd party debt collectors are required to do," the Smiths explicitly referenced "Title 15 Section 1692" when discussing the Supreme Court's warning that "when people enter into any dealings with agents, the people better investigate the authority and limits of authority that the agents possess." And 15 U.S.C. § 1692 et seq. is known as the "Fair Debt Collection Practices Act." See, e.g., Midland Funding, LLC v. Johnson, 137 S. Ct. 1407, 1410 (2017) ("The Fair Debt Collection Practices Act, 91 Stat. 874, 15 U.S.C. § 1692 et seq., prohibits a debt collector from asserting any `false, deceptive, or misleading representation,' or using any `unfair or unconscionable means' to collect, or attempt to collect, a debt, §§ 1692e, 1692f."). The Smiths invoked the federal statute—by name and by number—and alleged conduct that may violate that act.

It bears emphasizing that factual allegations alone may state a claim for relief—even without referencing the precise legal theory (or statute) upon which the plaintiff seeks relief.^[13] We find such guidance in the Supreme Court's decision in Johnson v. City of Shelby, 135 S. Ct. 346 (2014).

According to the Court, "[f]ederal pleading rules call for `a short and plain statement of the claim showing that the pleader is entitled to relief,' FED. RULE CIV. PROC. 8(a)(2); they do not countenance dismissal of a complaint for imperfect statement of the legal theory supporting the claim asserted." Id. at 346. A plaintiff "must plead facts sufficient to show that her claim has substantive plausibility." Id. at 347. Plaintiffs may accomplish this by "stat[ing] simply, concisely, and directly events that, they allege[], entitle[] them to damages." Id. As long as such pleadings inform defendants of the complaint's factual basis, plaintiffs need "do no more to stave off threshold dismissal for want of an adequate statement of their claim." Id. (citations omitted). Thus, plaintiffs may state a claim for relief by pleading facts that support the claim.

The Smiths did just that—and cited the legal theory underlying their claim. The Smiths' explicit reference to the "Fair Debt Collection Practice[s] Act" (and its position in the U.S. Code), coupled with a description of conduct that could subject the Defendants to liability under the Act, solidifies our conclusion.

Consequently, a district court could assert original jurisdiction over the complaint on the basis of 28 U.S.C. § 1331. And removal jurisdiction is proper under 28 U.S.C. § 1441(a). No ambiguity in the complaint gives us reason to construe the removal statute narrowly.

C

The Smiths offer two additional arguments for why we should find they pleaded only state-law claims: (1) their federal claim is time-barred; and (2) they requested treble damages, which the Texas Fair Debt Collection Practices Act provides for, but the federal Act does not. We are not persuaded by either argument.

The first argument misunderstands federal jurisdiction. If a complaint is time-barred, that speaks to the plaintiffs' ability to prevail in the suit—not our ability to assert jurisdiction. Indeed, federal courts routinely assert jurisdiction over time-barred claims. See, e.g., Taylor v. Bailey Tool Mfg. Co., 744 F.3d 944, 945-47 (5th Cir. 2014) (affirming that the plaintiff's federal-law claims were "barred by the applicable statutes of limitations" after the defendant removed the case to federal court on the basis of federal-question jurisdiction); Winters v. Diamond Shamrock Chem. Co., 149 F.3d 387, 390 (5th Cir. 1998)("[W]e do indeed have jurisdiction under the Federal Officer Removal Statute, and . . . we therefore may reach the merits of this appeal. In so doing, we affirm the judgment of the district court dismissing the complaint as barred by the Texas statute of limitations.").

Turning to the second argument, the Smiths did request treble damages—but that does not mean they alleged only a state-law claim.^[14] The Smiths believe that only a violation of the Texas Fair Debt Collection Practices Act provides for treble damages. They are incorrect. The Texas Fair Debt Collection Practices Act does not itself permit treble damages. See Tex. Fin. Code § 392.403 (1997). Treble damages result from a related statute: An intentional and knowing violation of the Texas Fair Debt Collection Practices Act "is a per se violation of the Texas Deceptive Trade Practices Act (DTPA) (Tex. [Fin. Code] § 392.404), which allows treble damages for knowing and intentional violations." HON. JAMES J. BROWN, JUDGMENT ENFORCEMENT § 14.01 (3d ed. 2018). And a knowing and intentional violation of the federal Fair Debt Collection Practices Act is also a violation of Texas's DTPA— meaning a plaintiff could seek treble damages under Texas law for an intentional violation of the federal Act. Id. Thus, the Smiths' reference to "Treble Damages" does not convince us that they stated only a state-law claim.

Also, the Smiths did not only request treble damages; they also requested "Economic Damages."

The federal Fair Debt Collection Practices Act allows plaintiffs to collect economic damages from malicious debt collectors. See 15 U.S.C. § 1692k (2011). Thus, requesting "Economic Damages" is consistent with raising a federal claim.

III

The Smiths give us no reason to believe they did not plead both state- and federal-law claims. They cite no case in which our court—or any court— found federal-question jurisdiction absent when a fair reading of a pro se plaintiff's complaint included an explicit allegation that the defendant violated a federal statute. Because we find the Smiths stated a federal cause of action on the face of their original complaint, we conclude the district court could exercise subject-matter jurisdiction. 

We AFFIRM the district court's decision to deny the Smiths' motion to remand the case to state court.

[*] Pursuant to 5TH CIR. R. 47.5, the court has determined that this opinion should not be published and is not precedent except under the limited circumstances set forth in 5TH CIR. R. 47.5.4.

[1] Our previous opinion contains a more detailed description of the facts. See Smith, 605 F. App'x at 312-13.

[2] In their original motion to remove, the Defendants asserted that the Smiths stated a cause of action for a violation of the Federal Debt Collection Practices Act. The Defendants also asserted that the Smiths' wrongful foreclosure claim was preempted by the Home Owners' Loan Act, giving rise to federal question jurisdiction. They also claimed diversity jurisdiction existed, arguing that any non-diverse Defendants were improperly joined.

[3] In his report, the magistrate judge explained that federal question jurisdiction was apparent from the face of the original complaint, the Defendants' Home Owners' Loan Act preemption argument was "superfluous," and diversity jurisdiction existed because "fraudulent joinder was established at the time of removal." The district court agreed with the magistrate judge that the Smiths' "Original Petition clearly allege[d] a violation of federal law on its face."

[4] Given this finding, there is no need to address the Defendants-Appellees' claims regarding diversity jurisdiction (including the claims of improper joinder).

[5] The Smiths filed their original complaint pro se; they are now represented by counsel.

[6] 28 U.S.C. § 1331.

[7] One exception is the "less frequently encountered[] variety of federal `arising under' jurisdiction . . . [in which] in certain cases federal-question jurisdiction will lie over state-law claims that implicate significant federal issues." Grable & Sons Metal Prod., Inc. v. Darue Eng'g & Mfg., 545 U.S. 308, 312 (2005). We do not find that "arising under" jurisdiction is an issue in this case.

[8] Of course, the Defendants do not claim these allegations state a plausible claim to relief. We do not address the plausibility of the allegations.

[9] 15 U.S.C. § 1692 et seq.

[10] The Smiths' original complaint does not neatly lay out their allegations. There is no section in which the Smiths consolidate the various claims they may have against the Defendants, nor is there a section listing the various counts. Instead, the Smiths sprinkle facts and legal authority throughout the complaint.

[11] Indeed, our jurisprudence regarding pro se pleadings gives us reason to liberally construe the Smiths' complaint in favor of finding they had stated a claim under the federal Fair Debt Collection Practices Act. See Wiggins, 710 F. App'x at 628.

[12] Notably, the Smiths did not refer to the Texas law by its colloquial name.

[13] Our Court previously recommended the district court consider "whether federal question jurisdiction" may exist because "[i]n the `facts' section of their original pro se complaint, for instance, the Smiths alleged that Bank of America was a `third party debt collector' that failed to adhere to the Fair Debt Collection Practices Act (e.g., by failing to provide documentation that the bank was the current mortgage servicer)." Smith, 605 F. App'x at 315 n.5.

[14] Specifically, the Smiths requested "Additional Treble Damages for all intentional and knowing violations."

Wilmington Trust, N.A. v. Rob (5th Cir 2018) Fifth Circuit recognizes that acceleration of maturity is a harsh remedy, and that equitable constraints apply

"Because Wilmington Trust failed to meet its burden to show clear and unequivocal notice of intent to accelerate prior to filing suit, it is not entitled to a foreclosure judgment."

Fifth Circuit makes Erie guess, says Texas Supreme Court would hold that another notice of intent to accelerate is required when previous acceleration was rescinded. Not sure the all-Republican Texas Supreme Court wouldn't establish new precedent to favor the lender if given the chance, but under long-standing SCOTX precedent, two notices are required prior to acceleration: (1) Notice of Intent to Accelerate (giving the home owner a chance and a deadline to cure the default), and (2) Notice of Actual Acceleration. Here, the prior acceleration was completely undone by a notice of rescission, and matters reverted to the status quo ante. Therefore, another notice of intent to accelerate was required to again proceed toward foreclosure. Because none was given, the Fifth Circuit reversed the summary judgment of foreclosure and dismissed the case, rather than remanding it to give the assignee of the note another chance to obtain a foreclosure order without filing a new lawsuit. 

WILMINGTON TRUST, NATIONAL ASSOCIATION, not in its individual capacity but as Trustee of ARLP Securitization Trust, Series 2014-2, Plaintiff-Appellee,
v.
ANGEL ROB; KCEVIN ROB, Defendants-Appellants.

No. 17-50115.

United States Court of Appeals, Fifth Circuit.

Filed: May 21, 2018.

Michael Doyle Conner, for Plaintiff-Appellee.

Mark Douglas Cronenwett, for Plaintiff-Appellee.

Michael F. Hord, for Plaintiff-Appellee.

William D. Davis, for Defendant-Appellant.

Dustin C. George, for Plaintiff-Appellee.

Appeal from the United States District Court for the Western District of Texas.

Before: SMITH, BARKSDALE, and HIGGINSON, Circuit Judges.

STEPHEN A. HIGGINSON, Circuit Judge.

Kcevin and Angel Rob defaulted on a home equity loan. The Robs' lender, Wilmington Trust, sued for a judgment permitting foreclosure. The district court granted summary judgment in Wilmington Trust's favor. The Robs appeal, arguing that Wilmington Trust is not entitled to foreclosure because the company failed to prove that it provided adequate notice of intent to accelerate. 

Agreeing, we reverse the summary judgment and render a judgment of dismissal.^[1]

I.

On July 26, 2007, appellant Kcevin Rob executed a note in the principal amount of $113,600. On the same day, Kcevin and his wife Angel executed a Texas Home Equity Security Instrument, which secured payment of the note with a lien on the Robs' home in Austin, Texas. In 2014, following a series of assignments, Wilmington Trust, as trustee for ARLP Securitization Trust, Series 2014-2, came into possession of the Robs' loan.

By the time Wilmington Trust acquired it, the Robs' loan had a tumultuous history. The Robs stopped making payments on the loan in March 2011. On April 15, 2011, one of Wilmington Trust's predecessors mailed Kcevin a notice of default and intent to accelerate.^[2] On June 22, 2011, Kcevin was sent a notice of acceleration. On March 6, 2012, the predecessor sent a second notice of default and intent to accelerate, followed by a second notice of acceleration on May 22, 2013. On November 3, 2014, Wilmington Trust, having taken assignment of the loan, sent the Robs a "NOTICE OF RESCISSION OF ACCELERATION." That document stated that the lender "hereby rescinds Acceleration of the debt and maturity of the Note" and that the "Note and Security Instrument are now in effect in accordance with their original terms and conditions, as though no acceleration took place."

On June 25, 2015, Wilmington Trust sued the Robs in the Western District of Texas seeking a judgment for foreclosure or, alternatively, a judgment of equitable subrogation. In August 2015, Wilmington Trust filed an Amended Complaint, which alleged that the total debt owed on the note was $159,949.07. The Amended Complaint also stated that Wilmington Trust "accelerates the maturity of the debt and provides notice of this acceleration through the service of this Amended Complaint."

On August 26, 2016, Wilmington Trust moved for summary judgment. The district court granted Wilmington Trust's motion, and entered judgment permitting Wilmington Trust to foreclose on the Robs' home. This appeal followed.

II.

We review a grant of summary judgment de novo, applying the same standard as the district court. Auguster v. Vermilion Parish Sch. Bd., 249 F.3d 400, 402 (5th Cir. 2001). "Where, as here, the proper resolution of the case turns on the interpretation of Texas law, we are bound to apply Texas law as interpreted by the state's highest court." Boren v. U.S. Nat. Bank Ass'n, 807 F.3d 99, 104-05 (5th Cir. 2015) (quoting Am. Int'l Specialty Lines Ins. Co. v. Rentech Steel LLC, 620 F.3d 558, 564 (5th Cir. 2010)). On issues the Texas Supreme Court has not yet decided, "we must make an `Erie guess' as to how the Court would resolve [the] issue." Id (quoting Am. Int'l Specialty Lines Ins. Co., 620 F.3d at 564).

III.

"[W]hether a holder has accelerated a note is a fact question." Holy Cross Church of God in Christ v. Wolf, 44 S.W.3d 562, 568 (Tex. 2001). Wilmington Trust's lien includes an optional acceleration clause, under which the "Lender at its option may require immediate payment in full of all sums secured by this Security Instrument. . . ." In its First Amended Complaint, Wilmington Trust alleges that it has accelerated the Robs' debt, that the Robs are in default of the full $159,949.07 owed under the note, and that Wilmington Trust should therefore be permitted to foreclose.

"Texas courts disfavor acceleration because it imposes a severe burden on the mortgagor." Schuhardt Consulting Profit Sharing Plan v. Double Knobs Mountain Ranch, Inc., 468 S.W.3d 557, 569 (Tex. App.-San Antonio 2014, pet. denied); see also Mastin v. Mastin, 70 S.W.3d 148, 154 (Tex. App.-San Antonio 2001, no pet.) ("Acceleration is a harsh remedy with draconian consequences for the debtor and Texas courts look with disfavor upon the exercise of this power because great inequity may result."). Further, a lender may lose the right to accelerate if its conduct is "inconsistent or inequitable." William J. Schnabel Revocable Living Tr. v. Loredo, No. 13-13-00297, 2014 WL 4049862, at *5 (Tex. App.-Corpus Christi Aug. 14, 2014, no pet.) (quoting McGowan v. Pasol, 605 S.W.2d 728, 732 (Tex. App.-Corpus Christi 1980, no writ)).

Consistent with this caution, Texas common law imposes notice requirements before acceleration. In Texas, "[e]ffective acceleration requires two acts: (1) notice of intent to accelerate, and (2) notice of acceleration." Wolf, 44 S.W.3d at 566. "Both notices must be `clear and unequivocal.'" Id. (quoting Shumway v. Horizon Credit Corp., 801 S.W.2d 890, 893 (Tex. 1991)). Here, Wilmington Trust's complaint could serve as adequate notice of acceleration,^[3] but only if it was preceded by valid notice of intent to accelerate. See Jasper Fed. Sav. & Loan Ass'n v. Reddell, 730 S.W.2d 672, 674 (Tex. 1987) ("In Texas, notice that the debt has been accelerated is ineffective unless preceded by proper notice of intent to accelerate."). Unless a lender provides both forms of notice, it may not foreclose.^[4] See Bodiford v. Parker, 651 S.W.2d 338, 339 (Tex. App.-Fort Worth 1983, no writ) (en banc) (affirming grant of temporary injunction prohibiting foreclosure where "there was no notice of intent to accelerate given [and] therefore the beneficiary could not accelerate"); see also Ogden v. Gibraltar Sav. Ass'n, 640 S.W.2d 232, 234 (Tex. 1982) (rendering judgment for borrower in wrongful foreclosure suit where lender "did not give proper notice of its intent to accelerate the debt" and therefore "any attempted acceleration was ineffective").

Texas courts require pre-acceleration notice to be "clear and unequivocal." Wolf, 44 S.W.3d 562 at 566. For instance, in Ogden, the Texas Supreme Court held that a letter stating that the borrower's default "may result in acceleration" was ineffective because "[t]he letter gave no clear and unequivocal notice that [the lender] would exercise the option." Ogden, 640 S.W.2d at 233-34 (second emphasis added). The court explained that, to be effective, notice of intent to accelerate must "bring home to the mortgager that failure to cure will result in acceleration." Id. at 233.

Texas courts have not squarely confronted whether a borrower is entitled to a new round of notice when a borrower re-accelerates following an earlier rescission. Forced to make an Erie guess, we hold that the Texas Supreme Court would require such notice, and that Wilmington Trust has therefore failed to meet its summary judgment burden. Abandonment of acceleration "restor[es] the contract to its original condition." Boren,807 F.3d at 104 (quoting Khan v. GBAK Props., Inc., 371 S.W.3d 347, 353 (Tex. App.-Hous. [1st Dist.] 2012)). The Texas Supreme Court would likely conclude that Wilmington Trust acted "inconsistently" by rescinding acceleration and then re-accelerating without notice. Karam v. Brown, 407 S.W.3d 464, 473 (Tex. App.-El Paso 2013, no pet.). Once notice of acceleration had been rescinded, the Robs did not have "clear and unequivocal notice that [Wilmington Trust] would exercise the option." Ogden,640 S.W.2d at 233-34 (emphasis added). This holding is consistent with observations by intermediate Texas appellate courts that re-notice is required after acceleration is rescinded. See Karam, 407 S.W.3d at 468 (affirming trial court entry of decision in wrongful foreclosure claim, where trial court held that after the lender abandoned his earlier acceleration he was required to provide the borrower with a new demand and notice of default); Herrera v. Emmis Mortgage, No. 04-95-00006, 1995 WL 654561, at *4 (Tex. App.-San Antonio 1995, writ denied) ("absent evidence that the Note was reinstated, appellee was not required to re-accelerate by serving new notices, demands, and accelerations." (emphasis added)).

Because Wilmington Trust failed to meet its burden to show clear and unequivocal notice of intent to accelerate prior to filing suit, it is not entitled to a foreclosure judgment. Accordingly, we hold that Wilmington Trust has not met its burden and reverse the district court's grant of summary judgment.

IV.

The summary judgment is REVERSED, and a judgment of dismissal is RENDERED.

[1] The Robs also argue the loan documents do not meet the requirements for foreclosure-eligibility contained in Article XVI, Section 50(a)(6) of the Texas Constitution. We do not reach this issue.

[2] Acceleration is "[t]he advancing of a loan agreement's maturity date so that payment of the entire debt is due immediately." Acceleration, Black's Law Dictionary (10th ed. 2014).

[3] See Smither v. Ditech Fin., L.L.C., 681 F. App'x. 347, 352 (5th Cir. 2017) ("Once the requisite notice of intent is provided, notice of acceleration may take the form of the filing of a foreclosure action."); Burney v. Citigroup Glob. Markets Realty Corp., 244 S.W.3d 900, 904 (Tex. App.-Dallas 2008, no pet.) ("[N]otice of filing an expedited application for foreclosure after the requisite notice of intent to accelerate is sufficient to constitute notice of acceleration.").

[4] A borrower may waive its right to notice of intent to accelerate, but the waiver must be unequivocal. Shumway v. Horizon Credit Corp., 801 S.W.2d 890, 893-94 (Tex. 1991). The Robs waived presentment, but this waiver does not extend to notice of intent to accelerate. See Shumway, 801 S.W.2d at 895.