February 6, 2018- Nationstar Mortgage LLC v. Sheila J. O’Malley, No. A-1-CA-35518

OCR transcription for search; preserved printed pages are authoritative

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Filed

Court of Appeals of New Mexico
2/6/2018 11:34:00 AM

Opinion Number:

Filing Date: February 6, 2018

No. A-1-CA-35518

NATIONSTAR MORTGAGE LLC, d/b/a
CHAMPION MORTGAGE COMPANY,

Plaintiff-Appellant,
V.
SHEILA J. O’>MALLEY,
Defendant-Appellee,
and

TIMOTHY W. O’MALLEY, IF LIVING;

IF DECEASED THE UNKNOWN HEIRS

OF TIMOTHY W. O’MALLEY, DECEASED;

UNITED STATES OF AMERICA BY AND THROUGH
THE SECRETARY OF HOUSING

AND URBAN DEVELOPMENT; OCCUPANTS

OF THE PROPERTY,

Defendants.

APPEAL FROM THE DISTRICT COURT OF TAOS COUNTY
Sarah C. Backus, District Judge

McCarthy & Holthus, LLP
Joshua T. Chappell

Karen H. Weaver
Albuquerque, NM

Ma

IN THE COURT OF APPEALS OF THE STATE OF NEW MEXICO

of the Clerk

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—_—

rk Reynolds

IA NA HB W bo

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Albuquerque, NM

Murr Siler & Accomazzo, P.C.
James P. Eckels

Jamie G. Siler

Denver, CO

Jared Daniel Albert Najjar
Santa Fe, NM

for Appellant

Dixon ¢ Scholl ¢ Carillo « P.A.
Orlando C. Martinez
Albuquerque, NM

for Appellee

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OPINION
BOHNHOFF, Judge.
a} Plaintiff Nationstar Mortgage, LLC, d/b/a Champion Mortgage Co.
(Nationstar), appeals the district court’s order granting summary judgment in favor
of Defendant Sheila J. O'Malley. The district court ruled that, pursuant to NMSA
1978, Section 40-3-13 (1993), a mortgage of residential property that Mrs.
O’Malley’s husband executed in favor of Nationstar was void because Mrs. O’Malley
did not execute it as well. We hold that the mortgage was valid, because Mrs.
O’Malley earlier had entered into a sole and separate property agreement that
transmuted the couple’s community property to her husband’s separate property. We
therefore reverse the summary judgment.
BACKGROUND
A. Factual History
23} The salient facts are undisputed. In September 2010, Timothy (Husband) and
Sheila (Wife) O’Malley acquired residential property in Taos, New Mexico (the
Property); the deed conveyed title to them as joint tenants with right of survivorship.
According to Wife’s affidavit supporting her motion for summary judgment, Husband
was an attorney and handled the couple’s assets and finances. In early 2012, the

O’Malleys were interested in purchasing an adjoining lot. “At that time, my husband

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had me sign some documents in order to purchase the adjacent lot and combine it
with the Property.” One of those papers apparently was a “SOLE AND SEPARATE
PROPERTY AGREEMENT AND CONVEYANCE” (SSPAC), which Husband and
Wife executed in the presence of a notary on March 7, 2012. The SSPAC provides

as follows:

Pursuant to [NMSA 1978, Section 40-3-8(A)(5) (1990)], Timothy W.
O’Malley and Sheila J. O’Malley, husband and wife, agree that the
property described as [Property’s legal description] is hereby designated
as the separate property of Timothy W. O’Malley. Sheila J. O’Malley
hereby expressly grants and conveys the above property to Timothy W.
O’Malley with special warranty covenants. Sheila J. O’Malley further,
expressly waives, relinquishes and releases any and all right, title, claim
or interest in and to the above described property heretofore or hereafter
acquired.

3}, | Thecontemplated purchase of the adjoining lot did not occur. Instead, on April
16, 2012, Husband executed in favor of MetLife Home Loans, a division of MetLife
Bank, N.A. (MetLife), an “Adjustable Rate Note (Home Equity Conversion)” and an
“Adjustable Rate Deed of Trust (Home Equity Conversion).” The deed of trust states
that, “THIS DEED OF TRUST SECURES A REVERSE MORTGAGE LOAN,” and
the parties otherwise characterize the transaction as a reverse mortgage loan

transaction.' Both the SSPAC and the deed of trust (Reverse Mortgage) were

‘With a reverse mortgage loan transaction, the debtor does not
make any monthly payments of principal and interest, and instead the
interest accumulates. Upon a specified event, e.g., the death of the debtor(s), the
debt becomes due. United States Fed. Trade Comm’n, “Reverse Mortgages,” available

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recorded with the Taos County Clerk on April 20, 2012. The SSPAC’s and Reverse
Mortgage’s recording information show filing times of 2:08:25 p.m. and 2:08:27
p.m., respectively.

{44 On June 1, 2012, Husband deeded the Property to himself and Wife “as joint
tenants with right of survivorship,” i.e., the deed returned the Property to its pre-
March 7, 2012, ownership status.

{5} On October 22, 2012, MetLife assigned the Reverse Mortgage to Nationstar,
which is a business name of Champion Mortgage Company. The assignment was
recorded on November 8, 2012.

6} Inthe interim, Husband died on June 30, 2014. Wife states in her affidavit that
she was not aware of the reverse mortgage transaction until sometime after her
husband’s passing when she received correspondence from Nationstar.

B. Procedural History

{7} In December 2014, Nationstar filed its complaint with the district court,
seeking a judgment foreclosing on its security interest in the Property pursuant to the
Reverse Mortgage and authorization to sell the Property to satisfy the underlying debt
that Nationstar alleged totaled approximately $375,000. Nationstar did not claim that

Wife was personally liable for the debt. In her answer, Wife generally denied or stated

at http://www.consumer.ftc.gov/articles/0192-reverse-mortgages.

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her lack of knowledge with respect to the complaint’s allegations, but also asserted
without elaboration affirmative defenses of “lack and failure of consideration,”
“mistake,” and “fraudulent conduct and bad faith” on the part of Nationstar.

{833 In December 2015, Wife filed a motion (the Motion) to dismiss the complaint
for failure to state a claim, or in the alternative, for summary judgment. Based solely
on her aforementioned affidavit testimony that “my husband had me sign some
documents in order to purchase the adjacent lot and combine it with the Property,”
Wife asserted in her statement of undisputed material facts that, “Mr. O’Malley had
[Mrs.] O’Malley sign a [SSPAC] under the pretense that it was necessary to facilitate
the purchase of the adjacent lot and combine it with the Property.” However, in her
motion Wife did not otherwise claim, or even suggest, fraudulent or other nefarious
conduct on the part of Husband, much less MetLife. On the contrary, her argument
was strictly legal: the Property was community property; pursuant to Section 40-3-13
and NMSA 1978, Section 47-1-7 (1901), the Reverse Mortgage was void both
because Wife did not sign it and because the March 7, 2012, SSPAC was not recorded
before the Reverse Mortgage was executed. Similarly, she contended that, because
the June 1, 2012, deed re-conveyed the Property to Husband and Wife, the subsequent
assignment of the Mortgage from MetLife to Nationstar was void as well because

both Husband and Wife failed to sign it. On the same day, Wife moved for a

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protective order excusing her from responding to what she characterized as
“voluminous sets of discovery” propounded by Nationstar until after the district court
ruled on her Motion.

{9} Nationstar timely responded in opposition to the motion for protective order
but not the Motion. However, on January 21, 2016, Nationstar moved for leave to file
a response to the Motion with a copy of the proposed substantive response attached.
Nationstar argued therein that: pursuant to Section 40-3-8(A)(5), the Property was
transmuted to Husband’s separate property on March 7, 2012, as a result of Wife’s
execution of the SSPAC; the SSPAC was effective as against Wife notwithstanding
the fact that it was not immediately recorded; Section 40-3-13 and Section 47-1-7 did
not invalidate the Reverse Mortgage because as of April 16, 2012, the Property was
no longer community property and, among other reasons, the SSPAC was not a power
of attorney; because the Reverse Mortgage was not community property, Section 40-
3-13 did not invalidate the October 22, 2012, assignment. Nationstar did not dispute
Wife’s statement of undisputed material facts. However, Nationstar requested that,
assuming the district court did not deny the Motion on the basis of these legal
arguments pursuant to Rule 1-056(F) NMRA, the district court should postpone
ruling on the request for summary judgment until after Nationstar had an opportunity

to conduct discovery.

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410} The district court scheduled a motions hearing for February 3, 2016. The
morning of the hearing, Nationstar’s counsel filed an affidavit pursuant to Rule 1-
056(F), asserting that, in order to respond fully to Wife’s summary judgment request,
Nationstar needed answers to the discovery it already had propounded—and which
was the subject of Wife’s protective order motion—and might need additional
discovery regarding “the facts surrounding . . . Defendant’s acquisition of the
property at issue, the execution and recording of the [SSPAC], the execution and
recording of the [Reverse] Mortgage, . . . and the reconveyance of the property to
[Husband and Wife].”

41} During the hearing, the district court stated that, in view of the affidavit and
documents attached and referred to in the Motion, it would treat the Motion as one
for summary judgment. The court asked Wife’s counsel to address Nationstar’s
argument that it would need additional time to conduct discovery. Wife’s counsel
stated that he did not believe there was a disputed issue of fact that was necessary to
resolve the case, but also argued that the Rule 1-056(F) affidavit was not sufficiently
specific and Nationstar had not disputed Wife’s statement of undisputed material
facts. The district court characterized Wife’s motion as a legal argument, but then
indicated its understanding that Wife’s position was that she signed the SSPAC under

false pretenses, that she thought it was executed for purposes of acquiring the

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adjoining lot and it was not given for purposes of the reverse mortgage. Wife’s
counsel responded by stating that those facts were not needed to rule on the motion.
4123} The district court then ruled that it would grant Wife’s motion. As grounds for
its ruling, the court stated that Wife had made a prima facie showing that she was
entitled to summary judgment and that Nationstar had not come forward with any
facts to rebut that showing and that it would not be able to proffer any facts even if
it was permitted additional discovery. In its written order, the district court deemed
Wife’s statement of undisputed material facts admitted by Nationstar, and stated that
Wife had made a prima facie showing of entitlement to summary judgment based on
Section 40-3-13, Nationstar had not rebutted that showing, and additional discovery
was not necessary for adjudicating the Motion. Nationstar appeals.

DISCUSSION

{13} Wereview the district court order granting summary judgment under a de novo
standard of review. Cain v. Champion Window Co., 2007-NMCA-085, 4 6, 142 N.M.
209, 164 P.3d 90.

A. Relevant Statutes

4} Section 40-3-8(A)(5), part of the Community Property Act of 1973 (the Act),
NMSA 1978, Section 40-3-6 to -17 (1973, as amended through 1997), provides in

pertinent part as follows:

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A. “Separate property” means:

(5) property designated as separate property by a written
agreement between the spouses, including a deed or other written
agreement concerning property held by the spouses as joint tenants or
tenants in common in which the property is designated as separate

property.

B. “community property” means property acquired by either

or both spouses during marriage which is not separate property. Property

acquired by a husband or wife by an instrument in writing whether as

tenants in common or as joint tenants or otherwise shall be presumed to

be held as community property unless such property is separate property

within the meaning of Subsection A of this section.
Section 40-3-8(A)(5), (B). Under Section 40-3-8(B), any property that is acquired by
the marital community during marriage is presumptively community property. Section
40-3-12(A); English v. Sanchez, 1990-NMSC-064, J 11, 110 N.M. 343, 796 P.2d 236;
Arch, Ltd. v. Yu, 1988-NMSC-101, § 7, 108 N.M. 67, 766 P.2d 911. Thus, the
contours of community property are defined by the exclusions articulated in Section
40-3-8(A), one of which is property that is the subject ofa sole and separate property
agreement signed by both spouses. See, e.g., Estate of Fletcher v. Jackson, 1980-
NMCA-054, ¥] 46, 94 N.M. 572, 613 P.2d 714.

115} Section 40-3-13 provides in pertinent part as follows:

A. Except for purchase-money mortgages and except as
otherwise provided in this subsection, the spouses must join in all

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transfers, conveyances or mortgages or contracts to transfer, convey or
mortgage any interest in community real property and separate real
property owned by the spouses. . . in joint tenancy or tenancy in
common|[.]

Any transfer, conveyance, mortgage. . . or contract to transfer, convey,
[or] mortgage . . . any interest in the community real property or in
separate real property owned by the spouses as cotenants in joint
tenancy or tenancy in common attempted to be made by either spouse
alone in violation of the provisions of this section shall be void and of
no effect[.]

Except as provided in this section, either spouse may transfer, convey,
[or] mortgage ... separate real property without the other’s joinder.

B. Nothing in this section shall affect the right of one of the
spouses to transfer, convey, [or] mortgage . . . any community real
property or separate real property owned by the spouses as cotenants in
joint tenancy or tenancy in common without the joinder of the other
spouse, pursuant to a validly executed and recorded power of attorney
as provided in Section 47-1-7[.]

Section 40-3-13(A), (B).

416} Section 40-3-13, while also part of the Act, is derived from predecessor statutes
that generally required both spouses to join in the execution of certain real estate
transactions. See 1915 N.M. Laws, ch. 84, § 1; 1907 N.M. Laws, ch. 37, § 16. The
law was prompted by a perceived need to “protect [a] wife’s interest in community
property from her husband’s otherwise almost exclusive control.” English, 1990-

NMSC-064, § 14. Wife urges on the basis of case law precedent that the statute

should be broadly construed to void mortgages and conveyances executed by married

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individuals where their spouses do not also sign the instrument. She overstates the
holdings of the cases. New Mexico courts consistently have ruled that an attempted
conveyance of community property not joined in by both spouses is void and a nullity
as opposed to only voidable. See, e.g., Jenkins v. Huntsinger, 1942-NMSC-011, 4 14,
46 N.M. 168, 125 P.2d 327. Indeed, in Hannah v. Tennant, 1979-NMSC-009, ¥ 10,
92 N.M. 444, 589 P.2d 1035, our Supreme Court held that a buyer on a real estate
purchase agreement could raise, as an affirmative defense to the selling spouses’ suit
to enforce the agreement, the fact that one of the selling spouses had not joined in
executing the agreement, notwithstanding the fact that both selling spouses later
joined as plaintiffs in the specific performance action. In recent years, however, there
has been no further expansion of Section 40-3-13 beyond its plain language. In 1995,
the Legislature effectively mooted Hannah’s holding by adding the second sentence
of Section 40-3-13(B), which permits a non-signing spouse to ratify an otherwise
void transfer, conveyance, or mortgage. See N.M. Laws 1993, ch. 165, § 1. In
English, our Supreme Court declined “to expand the application of a nullity or
wholly-void doctrine beyond its present limits. ... [A] sales contract, valid at the time
of execution, is valid as to after-acquired separate property, once transmuted by
written agreement between the spouses.” 1990-NMSC-064, ff 20, 22. In Huntington

Nat’l Bank v. Sproul, 1993-NMSC-051, 431, 116N.M. 254, 861 P.2d 935, the Court

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declined to read into Section 40-3-13 “non-existent” language to require joinder of
both spouses in creation of community debt that might later be satisfied out of
community property when the creditor obtains and records a judgment.

73 Past judicial construction of Section 40-3-13 has simply applied the statute in
accordance with its plain language, in particular, that “void and of no effect” means
exactly that. Thus, one lesson of these decisions is that it is important to carefully
read the language of the statute. In particular, Section 40-3-13 nullifies transfers,
conveyances, and mortgages signed by only one spouse only if the subject property
is community property. If at the time of the transaction the property is separate
property, Section 40-3-13 is simply inapplicable.

8} English illustrates this point. Donald English entered into a real estate contract
to sell a parcel of land to the Sanchezes: upon the Sanchezes’ completion of a series
of installment payments over time, Donald would deliver a deed for the parcel. At the
time the contract was executed, however, title to the parcel was held by a corporation
owned by Donald and his wife, Emma. Donald, as president of that corporation,
subsequently deeded legal title to the property to another corporation that he and
Emma owned. Some years later, the Sanchezes defaulted on their payments under the
contract. At that point Donald, as president of the second corporation, conveyed it to

himself and then brought suit to enforce the contract against the Sanchezes. The

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Sanchezes moved for summary judgment, claiming that Section 40-3-13 invalidated
Donald’s title. At that point, and prior to the district court’s consideration of the
summary judgment motion, Donald and Emma entered into an agreement designating
the parcel as Donald’s separate property. English, 1990-NMSC-064, § 4.

419} Our Supreme Court initially noted that, because the doctrine of after-acquired
property, see, e.g., Hays v. King, 1989-NMSC-078, 4 8, 109 N.M. 202, 784 P.2d 21
(adopting the doctrine), permits a person to “enter into a valid contract to sell real
estate to which he has no title, provided he is able to carry through with the
transaction after the final payment is made or tendered,” the fact that Donald
originally did not hold title to the parcel personally did not necessarily bar him from
enforcing the real estate contract. English, 1990-NMSC-064, 9 7. The Court next
determined that Section 40-3-13 did not invalidate the original transaction based on
Emma’s failure to sign the real estate contract, because at that time the parcel was not
community property but rather corporate property and a corporation can convey
corporate real estate “without the restrictions placed upon the sale of community real
property.” English, 1990-NMSC-064, { 8. “At that time the contract did not attempt
to convey an interest in community real property.” Id. 920; cf Dotson v. Grice, 1982-
NMSC-072, § 10, 98 N.M. 207, 647 P.2d 409 (holding that upon contribution of

property owned by a married couple to general partnership, it no longer has

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community property status and Section 40-3-13 is not applicable; instead, its
conveyance is governed by partnership law). The Court then determined that, when
Donald took title to the parcel from the corporation, it became community property.
At that juncture, “the contract was void as to after-acquired community property[.]”
English, 1990-NMSC-064, § 13. However, the transmutation of the parcel into
separate property changed the result:

[A] sales contract, valid at the time of execution, is valid as to after-
acquired separate property, once transmuted by written agreement
between the spouses. The fact that the property was held for an interim
as an asset of the community may have rendered the contract void for
purposes of selling community property, but the interim holding of the
property by the community need not void the contract for the purpose of
selling separate property that is acquired through transmutation.

Id. § 22.
720} Section 47-1-7, incorporated by reference in Section 40-3-13(B), provides as
follows:

All powers of attorney or other writings containing authority to convey
real estate, as agent or attorney of the owner of the same, or to execute,
as agent for another, any conveyance of real estate, or by which real
estate may be affected in law, or equity, shall be acknowledged,
certified, filed and recorded, as other writings conveying or affecting
real estate are required to be acknowledged. No such power of attorney,
or other writing, filed and recorded in the manner prescribed in this
section, shall be considered revoked by any act of the party executing
the same, until the instrument of writing revoking the same, duly
acknowledged and certified to, shall be filed for record and recorded in
the office of the county clerk where said power of attorney or other
writing is filed and recorded.

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D. TheSSPAC Was Not Void as a Result of Wife’s Non-Joinder or the Delay
in Recording It

1. The Property Was Separate Property When the SSPAC Was Executed
213. Relying on Hannah, Wife contends that because she did not join in it and she
had not given Husband a power of attorney, pursuant to Section 40-3-13(A) and (B),
the Reverse Mortgage was void. Wife’s argument assumes, however, that the
Property was community property as of April 16, 2012, when the Reverse Mortgage
was executed. As our Supreme Court observed in English, “The chain of title to this
property and its relation to the time the [Reverse Mortgage] was executed are
important factors in the resolution of the questions raised in this appeal.” 1990-
NMSC-064, § 7. The March 7, 2012 SSPAC, which Wife acknowledges she signed,
rebuts the presumption that the Property was community property on April 16, 2012.
Instead, the SSPAC transmuted the Property into Husband’s separate property and he
had authority to unilaterally grant a mortgage.

2. Recording Was Not Necessary for the SSPAC To Be Effective Against
Wife

2} As noted above, Wife cannot claim that the Reverse Mortgage was void as a
result of being recorded before the SSPAC: the SSPAC was recorded first in time.
Instead, and to nullify the otherwise obvious effect of the SSPAC, she finds

significance in the fact that Husband must have executed and/or delivered the Reverse

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Mortgage to Nationstar at some time prior to the recording of the SSPAC. On that
basis, she maintains her position that the Reverse Mortgage was void for lack of her
joinder. This argument fails for three reasons.

23} First, the SSPAC itself does not require that it be recorded to be effective. On
the contrary, in the SSPAC Husband and Wife agreed “that . . . [the Property] is
hereby designated as the separate property of [Husband].” (Emphasis added.)
“Hereby” means “by this means; esp[ecially]: by means of this act or document.”
Webster’s Third New Int’l Dictionary 1058-59 (Unabridged ed. 2002). In the context
of the SSPAC, the word most reasonably connotes Husband’s and Wife’s
understanding that the transmutation of the Property from community property to
separate property was effective on the document’s execution as opposed to its
recording. Cf Suchan v. Suchan, 682 P.2d 607, 613 (idaho 1984) (holding that
married couple’s agreement that separate property was “hereby declared to be
community property” expressed intention “that the separate property described in the
agreement was to be transmuted to community property immediately upon the
execution of the agreement.” (emphasis and internal quotation marks omitted)).

244 Second, Section 40-3-8(A)(5) does not require that a sole and separate property
agreement must be recorded to be effective. Indeed, we can infer from Section 47-1-7

that if the Legislature intends that a real estate instrument be effective only upon

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recording, it explicitly will so provide.

gs} Third, and perhaps most fundamentally, Wife was a party to and thus had actual
knowledge of the SSPAC. NMSA 1978, Section 14-9-1 (1991), generally requires
that deeds, mortgages and “other writings affecting the title to real estate” shall be
recorded in the office of the clerk of the county in which the real estate is located. Id.
But the failure to record an instrument affecting title to real estate generally does not
invalidate it, particularly as against a party to the instrument or other person with
actual knowledge of it, and instead only negates any constructive notice of it.
“Generally, non-compliance with the recording statutes does not affect the validity
of the instrument itself, but makes it ineffectual as constructive notice.” Amethyst
Land Co. v. Terhune, 2014-NMSC-015, § 11, 326 P.3d 12. “The general rule is that
an unacknowledged deed is binding between the parties thereto, their heirs and
representatives, and persons having actual notice of the instrument.” Baker v. Baker,
1977-NMSC-006, [4 n.1, 90 N.M. 38, 559 P.2d 415.

3. Section 47-1-7 Does Not Invalidate the SSPAC

26} Wife, however, invokes Section 47-1-7’s recording requirement, because it is
incorporated into Section 40-3-13(B). By a fair reading of its terms, Section 47-1-7
requires that, to be effective, a power of attorney or other agreement authorizing one

party to convey real property owned by another must be recorded. Wife contends that

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the statute applies not only to powers of attorney and “other writings containing
authority to convey real estate” but also to “all... other writings . . . by which real
estate may be affected in law, or equity[.]” She characterizes the SSPAC as falling
within both of these descriptions. Based on this legal premise, she insists that,
because the Property had not been recorded at the point that the Reverse Mortgage
was given, the Property remained as community property and, pursuant to Section 40-
3-13, the Reverse Mortgage was void. We are not pursuaded.

27} First, we reject Wife’s broad construction of Section 47-1-7’s first sentence to
apply to, and require recording as a predicate to effectiveness of, not only all writings
containing authority to convey real estate but also other writings “by which real estate
may be affected in law, or equity.” Doing so would conflict with the generally
accepted rule, discussed above, that real estate instruments are effective as to their
signatories and their privies and others with actual notice regardless of recording.
Further, the second sentence of Section 47-1-7 indicates that “other writings” as used
in the first sentence cannot be understood to refer to more than a power of attorney
or other writing that is executed by one party and can be revoked. So limited, a sole
and separate property agreement executed by two spouses does not fit within the
scope of “other writing.”

8} Second, even assuming for the sake of argument that Section 47-1-7’s

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recording requirement applied to more than just powers of attorney, Section 40-3-
13(B) incorporates the statute only as it applies to powers of attorney. The scope of
Section 47-1-7 is irrelevant to the construction of Section 40-3-13 except to the extent
that Section 40-3-13(B)’s power of attorney exception to the both-spouse joinder
requirement mandates that the power of attorney be recorded.

29} Third, we reject Wife’s characterization of the SSPAC as a power of attorney
or other agreement containing authority to convey real estate that was subject to
Section 47-1-7. Wife herself executed the SSPAC and conveyed the Property to
Husband as his separate property. As a result, there simply was no need to authorize
Husband to do anything on Wife’s behalf with respect to her former interest in the
Property. Consistent with that reality, the SSPAC states that the parties were entering
into it pursuant to Section 40-3-8(A)(5), not Section 47-1-7.

30} Fourth, and as stated above, the SSPAC was recorded. Therefore, even
assuming Section 47-1-7 as incorporated into Section 40-3-13(B) was somehow
applicable to the transaction at issue herein, its requirements were satisfied. “There
is no requirement that an instrument be recorded within a particular period of time.”
Amethyst Land Co.,2014-NMSC-015, 4 12. In addition, also as stated above, because
Wife had actual notice of and in fact joined in the SSPAC, any failure to record it did

not invalidate it as to her. See id. { 11.

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313 Fifth, we reject the suggestion that the incorporation of Section 47-1-7 into
Section 40-3-13(B) somehow changes the meaning of Section 40-3-13(A). Section
40-3-13(B) simply articulates an exception to Section 40-3-13(A)’s requirement that
both spouses join in a mortgage, conveyance, or other transfer of community
property. It does not alter the fact that one spouse remains free to unilaterally convey
property that he or she holds as separate property. Compliance with Section 47-1-
7—whatever its scope—as incorporated into Section 40-3-13(B) is necessary only if
the transaction otherwise would be invalidated pursuant to Section 40-3-13(A). Thus,
a spouse’s authorization to convey real property is necessary only if the property is
held by the community. Because the Property was Husband’s separate property on
April 16, 2012, Section 40-3-13 was wholly inapplicable.

32} Toconclude, Wife assumes that Section 40-3-13(A) requires both spouses join
in any mortgage or conveyance of any property acquired during marriage unless the
exception articulated in Section 40-3-13(B)—one spouse holds a power of attorney
for the other spouse—is applicable. The flaw in Wife’s analysis is that she fails to
acknowledge that the scope of Section 40-3-13(A), by its terms, generally is limited
to community property or separate property held as joint tenants or tenants in
common. Because the SSPAC transmuted the Property from community property to

Husband’s separate property on March 7, 2012, Section 40-3-13 was simply

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inapplicable to the April 16, 2012, Reverse Mortgage transaction.

E. The October 22,2012 Assignment of the Reverse Mortgage Was Not Void
as a Result of Husband’s and Wife’s Non-Joinder

33} Wife also argues, again on the basis of Section 40-3-13, and because the
Property had reacquired its community property status as of June 1, 2012, that
MetLife’s October 22, 2012, assignment of the Reverse Mortgage to Nationstar was
invalid for lack of her joinder. By Wife’s logic, Husband’s failure to sign the
assignment also would operate to void it. While it is unclear whether the district court
ruled on this argument in granting summary judgment in favor of Wife, we reject it.
34} We note that the June 1, 2012, reconveyance of the Property to the marital
community was not free and clear, and instead was subject to the Reverse Mortgage.
“TT]he lien acquired by the mortgage upon the property . . . [cannot] be divested
either by the levying of process upon the mortgaged property, or the sale thereof by
the mortgagor, or under execution.” Chavez v. McKnight, 1857-NMSC-001, § 11, 1
N.M. 147. See Avondale Shipyards, Inc. v. Tank Barge ETS 2303, 754 F.2d 1300,
1309 (5" Cir.1985) (It is manifest that, according to settled security principles, the
sale of property encumbered by a mortgage does not itself extinguish the lien of the
mortgage.”).

35} The point of Section 40-3-13 is to bar one spouse from conveying or

encumbering community property—or separate property held in joint tenancy or

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tenancy in common—without the consent or authorization of the other. Thus, Section
40-3-13(A) voids any such conveyance or mortgage “attempted to be made by [one]
spouse alone.” The statute does not void transactions such as mortgage assignments
that, while they may affect community property, do not require the consent of either
spouse. Even assuming arguendo that Husband and Wife otherwise might have
standing as mortgagors to object to assignment of the Reverse Mortgage, but cf.
Flagstar Bank, FSB v. Licha, 2015-NMCA-086, § 18, 356 P.3d 1102 (stating that
mortgagors lacked standing to challenge assignment of mortgage on basis of lack of
consideration), abrogated on other grounds by BOKF, N.A. v. Gonzalez, No. A-1-

CA-35691, 2017 WL 2099830,93, = -NMCA-__, P.3d (June 28, 2017)

(non-precedential) (stating that mortgagors lacked standing to challenge assignment
of mortgage on basis of lack of consideration), the terms of the Reverse Mortgage
provided for its assignment at MetLife’s option. Thus, the October 22, 2012,
assignment was not subject to invalidation for failure to comply with Section 40-3-13.
F. Wife’s “Pretense” Theory

36} Wife claims on appeal that “MetLife was complicit in trying to circumvent
[Section] 40-3-13” and that the SSPAC was “an unrecorded, fraudulently obtained,
consideration-less conveyance of real community property[.]” We decline to address

these contentions for two reasons.

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37} First, to our understanding, the district court did not base its decision on such
an argument. It is true that near the end of the hearing on the summary judgment
motion the district court stated its understanding of the import of the “under the
pretense” phrase in Wife’s statement of undisputed facts: Wife understood that the
only purpose of the SSPAC was to facilitate the acquisition of the lot that adjoined
her and her husband’s residence. But Wife’s counsel then added that this fact was not
necessary to rule on the motion. Further, in its oral explanation of its ruling, the court
stated that Nationstar would not be able to rebut Wife’s case for summary judgment
even assuming it was permitted its requested additional discovery which included,
among other subjects, the facts surrounding Husband’s and Wife’s signing of the
SSPAC. For that reason, the district court denied Nationstar’s request that the court
postpone ruling on the motion until after it could conduct discovery. We understand
from these statements that the district court did not rely on any consideration of
possible mistake or fraud in reaching its decision, and instead ruled solely on the
basis of Wife’s legal arguments regarding the meaning of Sections 40-3-13 and 47-1-
7.

38} Second, while as a general matter this Court will affirm the district court if its
decision is right for any reason, even one that it did not consider, see Hawkins vy.

McDonald’s, 2014-NMCA-048, ¥ 23, 323 P.3d 932, we will not consider bare

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assertions that are not developed and supported by legal authority and analysis. See,
é.g., Curry v. Great Nw. Ins. Co., 2014-NMCA-031, 928, 320 P.3d 482 (declining to
address argument where appellee provided no authority); State ex rel. Office of State
Eng’r v. Lewis, 2007-NMCA-008, § 74, 141 N.M. 1, 150 P.3d 375 (declining to
address the issue where appellant provided no supporting “evidence, discussion, or
authority”); Los Alamos Nat’! Bank v. Martinez Surveying Servs., LLC, 2006-NMCA-
081,925, 140 N.M. 41, 139 P.3d 201 (declining to address argument where appellee
provided no authority, overruled on other grounds by Miller v . THI of N.M., No. A-
1-CA-29459, 2009 WL 6575071, _| -NMCA-__, 91, ~P.3d__ (Aug. 28,
2009) (non-precedential). Wife never developed her “pretense” suggestion below. In
her answer to Nationstar’s complaint, Wife asserted without elaboration affirmative
defenses of “lack and failure of consideration,” “mistake,” and “fraudulent conduct
and bad faith” on the part of Nationstar. However, other than perhaps the possible’
connotation implicit in the word “pretense,” she did not discuss or even assert any of
these or other claims of improper conduct on the part of Husband much less MetLife
as a basis for voiding the SSPAC and thus summary judgment. Wife also has not

developed those theories on appeal. In particular, she does not provide any legal

*“[P resentation of what is deceptive or hypocritical” is only one of several

definitions of “pretense.” Webster’s Third Int’! Dictionary 1797 (Unabridged ed.
2002).

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authority or otherwise address any fraud- or mistake-based theory for voiding the
SSPAC. Instead, she relies solely on her legal arguments about the scope and legal
consequences of Section 40-3-13 and Section 47-1-7.

39} Under these circumstances, we decline to address, as a possible basis for
affirming, the unsupported possibility of wrongful conduct on the part of Nationstar
or its predecessor-in-interest, MetLife, particularly where neither Wife’s affidavit nor
even her statement of undisputed material facts implicates MetLife in Husband’s
“pretense.”’ There are simply too many unanswered questions based on the current
state of the record.

CONCLUSION

{40} On the basis of the summary judgment record before the district court, in
particular, the SSPAC executed by Husband and Wife, Nationstar had rebutted the
presumption that the Property was community property on April 16, 2012, when
Husband executed the Reverse Mortgage. As a result, the Reverse Mortgage was not
void pursuant to Section 40-3-13. Section 40-3-13 also did not operate to void the

October 22, 2012, assignment of the Reverse Mortgage. For these reasons, the district

*Similarly, because Wife has not raised any claims of breach of fiduciary duty
or constructive fraud, it also is unnecessary to consider the discussion regarding
adequacy of consideration and independent legal advice found in our recent opinion
in Gabriele v. Gabriele, _ -NMCA- _, P.3d (No. A-1-CA-34523, Jan. 31,
2018).

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||| court erred in granting summary judgment in favor of Wife. We therefore reverse the
2|| district court’s grant of summary judgment and dismissal of Nationstar’s complaint,
3}}and remand for further proceedings consistent with this opinion.

4is413 ITISSO ORDERED.

6 HENRY M. BOHNHOFF, Judge

7| WE CONCUR:

8 Ye fe
9] MICHAFA, E. vit IL, Judge

11M. MONICA ZAMORA, Judge

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