"In Re Helms" response to demanding Deed of Trust

[MtnMan]

So far I have not seen any foreclosure case histories online that are similar to how ours in unfolding.

We decided early on that we would not give financial information to the bank and therefore could not participate in a loan mod or short sale.

We found out through a qualified request that our loan originated through Quicken Loans was now owned by Deutsche Bank but managed by Indy Mac. After we defaulted on the mortgage we were notified that One West Bank (Indy Mac's new owner) was handling the mortgage but Indy Mac was still involved. (Who is on first?)

We are now in the foreclosure process. In NC foreclosure begins with notices from the lender that a hearing is to be held with the Clerk of Court to confirm their right to foreclose and to set a date for the auction to be held.

Before we even received our notices of the hearing we received the "Notice of Sale" including the date and time of the auction (as if the sale was already been approved by the Clerk of Court.) (The "Notice of Sale” is what gets posted on the courthouse bulletin board after the Clerk of Court approves the sale.) The filings indicated that One West Bank was requesting the foreclosure as if they were the holder of the debt. They also had a statement in the accompanying correspondence that if we did not challenge that correspondence within in 30 days they would use that failure to bar us from challenging their position. This sort of exclusion seems to be prohibited by the Fair Debt Collections Act.

We responded to the notice of the hearing by disavowing the loan and the holder of the mortgage and demanding certified copies of the Deed of Trust and Promissory Note to prove their right to foreclose. At this point the mortgage process was supposed to stop until our request was met. The foreclosure process did not stop but uncertified copies were sent to us with incredible speed

The Clerk of Court hearing was held on schedule. We made the demand for originals of the Deed of Trust and Promissory Note again at the hearing. The Trustee for the Bank could not provide any originals or even copies at the hearing despite a request of the Clerk of Court. Instead the Trustee requested a continuance for 30 days. The Trustee claimed that in NC they did not have to produce originals to foreclose citing a precedent of "In Re Helms". We have not figured out what precedent they are referring to or if their claim is valid. (Does anyone out there know what precedent the Trustee was referring to or if it is valid way to foreclose without the Deed of Trust and Promissory Note?)

The Trustee had a new "Notice of Sale" with a new date and time of auction in our mailbox the day after that initial hearing. (The Clerk of Court has yet to approve any foreclosure sale

Our contention is that the lender through their Trustee has violated the Fair Collections Act sections 807.9, 807.13, 809.b and 809.c by sending invalid notices of sale, dates and times. The penalties for a successful class action on such a violation can run up to $500,000 per claimant.

In addition, we offered at the hearing to do a "Cash for Keys" if we could have written assurance that if someone else came forward at a later time with the original documents they would be responsible for settling those claims

The Trustees response was that they did not do "Cash for Keys" but might consider a "Deed in Lieu". The Trustee suggested that a recorded “Notice of Satisfaction” should suffice to protect our interests. The follow-up from the Trustee by mail was a request for financial information. We still do not intend to give financial information.

If the Trustee produces original documents I suppose that we are basically done contesting the foreclosure.

Would we still have a possibility of joining a class action based on Fair Dept Collections violations?

Does anyone out there know about any class actions against One West Bank, Indy Mac or Deutsche Bank?

Any other thoughts on our position and or strategy would be appreciated.

[NewDad]

I don't have answers for you, but wanted to let you know I like the cut of your jib and have bookmarked this thread. I'm eager to see how it turns out.

[dealingwithHomeEq]

55 N.C. App. 68, *; 284 S.E.2d 553, **;
1981 N.C. App. LEXIS 2966, ***


IN THE MATTER OF FORECLOSURE OF A DEED OF TRUST EXECUTED BY WARREN HELMS AND WIFE, JONNIE T. HELMS, TO W. O. McGIBONY, TRUSTEE AND THE FEDERAL LAND BANK OF COLUMBIA, DATED JUNE 24, 1969, AND RECORDED IN BOOK A-182 PAGE 196, UNION COUNTY REGISTRY, BY C. FRANK GRIFFIN, SUBSTITUTE TRUSTEE

No. 8120SC363

COURT OF APPEALS OF NORTH CAROLINA

55 N.C. App. 68; 284 S.E.2d 553; 1981 N.C. App. LEXIS 2966

November 17, 1981, Heard in the Court of Appeals
December 1, 1981, Filed

PRIOR HISTORY: [***1] Appeal by respondents from Freeman, Judge. Judgment entered 11 December 1980 in Superior Court, Union County.

DISPOSITION: Affirmed.

CASE SUMMARYPROCEDURAL POSTURE: Respondent mortgagors appealed the judgment of the Union County Superior Court (North Carolina), which found in favor of petitioner bank trustee in the trustee's foreclosure proceeding against the mortgagors. The mortgagors argued that the trial court improperly admitted photocopies of their promissory note and deed of trust, that there was insufficient evidence to support the findings of fact, and that the bank waived its right of foreclosure.

OVERVIEW: The mortgagors defaulted on paying taxes on their property. The trustee brought foreclosure proceedings on the deed of trust. The trial court found for the trustee, and the court affirmed on appeal. The court held that photocopies of the note and deed of trust were properly admitted. The originals were not required under the best evidence rule because the mortgagors testified that the documents appeared to be photocopies of the note and deed of trust they had signed and that the photocopies of their signatures appeared to be copies of their actual signatures. Because the note and deed of trust were properly admitted, there was ample evidence to support the findings that the mortgagors executed a deed of trust, that the deed of trust secured a valid debt evidenced by a note payable to the bank, and that there was a default in the payment of indebtedness. Because the deed of trust specified a fixed time when nonpayment of taxes became a default, nonpayment gave the trustee the right to foreclose. The court found that if the mortgagors believed that they had an equitable defense of waiver of the right to foreclosure, they had to bring an action to enjoin the foreclosure sale.

OUTCOME: The court affirmed the trial court's judgment.

CORE TERMS: deed of trust, foreclosure, photocopies, right to foreclose, mortgagor, best evidence rule, assignments of error, signatures, default, enjoin, evidence to support, nonpayment, equitable, waived, clerk's, hearing de novo, evidenced, mortgagee, Deeds, equitable defense


SYLLABUS

Respondents appeal from an order authorizing the substitute trustee to proceed with foreclosure of their real estate.

On 18 November 1980, there was a hearing before the Clerk of Superior Court of Union County to determine the substitute trustee's right to foreclose on property owned by respondents. From an order authorizing such sale, respondents appealed to the Superior Court under G.S. 45-21.16.

At the hearing de novo held 8 December 1980, the following evidence was presented. On 24 June 1969, Warren and Jonnie T. Helms executed a deed of trust securing a debt of $ 67,500.00. The Federal Land Bank of Columbia is holder of both the note and the deed of trust. According to the terms of the deed of trust, the mortgagors are to pay, when due, all taxes assessed against the land. Upon failure [***3] to comply with this covenant, The Federal Land Bank retains the options of paying the unpaid taxes and seeking immediate repayment or declaring all amounts secured under the instrument immediately due.

On 18 March 1980, The Federal Land Bank gave respondents written notice that Union County real property taxes for 1978 and 1979, as well as Cabarrus County real property taxes for 1979, were past due and had become liens on the real estate. The bank stated that failure of the mortgagors to pay the taxes by 30 April 1980 would result in its payment of the taxes and charges assessed to the respondents' account. When respondents had not paid the taxes by 15 May 1980, The Federal Land Bank paid them.

On 18 June 1980, The Federal Land Bank unsuccessfully sought reimbursement from respondents. On 1 July 1980, it mailed the Helms notice that the loan was in default because of the nonpayment of delinquent taxes. In a second notice dated 21 August 1980, the bank stated its right under the deed of trust to accelerate payment. As a courtesy to respondents, however, foreclosure could be avoided by their contacting Larry Shoffner, an officer of The Federal Land Bank, and making satisfactory [***4] arrangements within fifteen days. Satisfactory financial arrangements were not made within that time.

Based on the evidence presented, the court found that Warren and Jonnie Helms had created a valid debt secured by a deed of trust; that the holder of the note was The Federal Land Bank of Columbia; that there had been a default in payment of the indebtedness; and that the Helms, the record owners of the real estate, had received proper notice of hearing before the clerk. It, therefore, ordered that the substitute trustee could proceed with foreclosure of respondents' real estate secured by the deed of trust.

COUNSEL: Perry and Bundy, by Donald C. Perry and H. Ligon Bundy, for petitioner appellee.

Harry B. Crow, Jr., for respondent appellants.

JUDGES: Vaughn, Judge. Judges Webb and Hill concur.

OPINION BY: VAUGHN

OPINION

[*70] [**554] Respondent-mortgagors make several assignments of error. They first contend the trial court erred in admitting into evidence photocopies of the promissory note and deed of trust. They argue that under the "best evidence" rule, the originals should have been required. We disagree.

HN1The rationale behind the "best evidence" rule is that the original [***5] instrument best identifies its own contents. 2 Stansbury, N.C. Evidence § 190 (Brandis rev. 1973). When the opposing party, however, admits that the documents shown him are correct copies of the original, the original need not be produced. Beard v. R.R., 143 N.C. 137, 55 S.E. 505 (1906); Cleary v. Cleary, 37 N.C. App. 272, 276, 245 S.E. 2d 824, 827 (1978).

In the present cause, both mortgagors examined the documents in question. They testified that the documents appeared to be photocopies of the note and deed of trust they had signed and that the photocopies of their signatures appeared to be copies of their actual signatures. The only question the respondents raised was that Mr. Helms did not recall the presence of an eight percent interest rate in the note. HN2The amount outstanding of a debt, however, is not relevant to a foreclosing proceeding. [**555] In re Foreclosure of Burgess, 47 N.C. App. 599, 603, 267 S.E. 2d 915, 918 (1980). We conclude that the photocopies of the note and deed of trust were properly admitted.

[*71] Respondents' next three assignments of error argue the lack of sufficient evidence to support the court's findings of fact. Since [***6] the note and deed of trust were properly admitted, however, there is ample evidence to support the court's findings that respondents had executed a deed of trust, that the deed of trust secured a valid debt evidenced by a note payable to The Federal Land Bank of Columbia, and that there had been default in the payment of indebtedness. HN3Because the deed of trust specified a fixed time when nonpayment of taxes became a default, the court also correctly found that nonpayment gave the substitute trustee the right to foreclose. In re Foreclosure of Deed of Trust, 41 N.C. App. 563, 255 S.E. 2d 260, cert. denied, 298 N.C. 297, 259 S.E. 2d 914 (1979). Respondents' assignments of error are overruled.

Respondents' final assignment of error is that the court erred in failing to conclude that The Federal Land Bank of Columbia had waived its right to foreclosure. We hold that the court properly excluded consideration of any equitable defense raised at the hearing de novo.

Respondents testified that after receiving the bank's letter of 21 August 1980, they contacted Mr. Shoffner on the 25th of August. He told them they would have a few weeks to "catch up the note." Relying on the [***7] delay, respondents arranged to sell another tract of land to a third party. One week later, when Mrs. Helms called Mr. Shoffner to learn how much money they would need to reimburse the bank for the tax payment, she was told that reimbursement would not be acceptable. Foreclosure proceedings had begun. Respondents argue that if the court had made findings consistent with their testimony, it would have concluded that the bank had waived any foreclosure right it may have had.

HN4According to G.S. 45-21.16, however, there are only four issues before the clerk at a foreclosure hearing: the existence of a valid debt of which the party seeking to foreclose is the holder, the existence of default, the trustee's right to foreclose, and the sufficiency of notice to the record owners of the hearing. The clerk's findings are appealable to the Superior Court within ten days for a hearing de novo, but the court's authority is likewise limited. In re Foreclosure of Burgess, supra. The judge has no equitable jurisdiction and cannot enjoin foreclosure upon any [*72] ground other than the ones stated in G.S. 45-21.16. Golf Vistas v. Mortgage Investors, 39 N.C. App. 230, 249 S.E. [***8] 2d 815 (1978); In re Watts, 38 N.C. App. 90, 247 S.E. 2d 427 (1978).

Because the hearing under G.S. 45-21.16 is designed to provide a less timely and expensive procedure than foreclosure by action, it does not resolve all matters in controversy between mortgagor and mortgagee. If respondents feel that they have equitable defenses to the foreclosure, they should be asserted in an action to enjoin the foreclosure sale under G.S. 45-21.34.

The judgment of the trial court is affirmed.

Affirmed.

__________________________________________________ ____________


Shepardize®: View: KWIC | Full
Display Options
Pinpoint Pages LexisNexis Headnotes Headnotes Numbers Citing Ref. Signals Set Defaults...
1 - 19 of 19 Total Cites

Unrestricted | All Neg | All Pos | FOCUS™- Restrict By
In re Helms, 55 N.C. App. 68 (TOA)

Signal: Citing Refs. With Analysis Available
Trail:Unrestricted .
--------------------------------------------------------------------------------
In re Helms, 55 N.C. App. 68, 284 S.E.2d 553, 1981 N.C. App. LEXIS 2966 (1981)

SHEPARD'S SUMMARY HIDE

Unrestricted Shepard's Summary

--------------------------------------------------------------------------------

No negative subsequent appellate history.
Citing References:
Neutral Analyses: Dissenting Op. (1)

Other Sources: Statutes (2), Treatises (4), Court Documents (3)


LexisNexis Headnotes: HN4 (9)

Show full text of headnotes


PRIOR HISTORY ( 0 citing references ) Hide Prior History

(CITATION YOU ENTERED):
In re Helms, 55 N.C. App. 68, 284 S.E.2d 553, 1981 N.C. App. LEXIS 2966 (1981)

SUBSEQUENT APPELLATE HISTORY ( 1 citing reference ) Hide Subsequent Appellate History

Select for Delivery
1. Petition denied by:
In re Helms, 305 N.C. 300, 291 S.E.2d 149 (1982)


--------------------------------------------------------------------------------

CITING DECISIONS ( 9 citing decisions )

NORTH CAROLINA SUPREME COURT

2. Cited by:
In re Foreclosure of Goforth Properties, Inc., 334 N.C. 369, 432 S.E.2d 855, 1993 N.C. LEXIS 336 (1993) LexisNexis Headnotes HN4

334 N.C. 369 p.374
432 S.E.2d 855 p.858
NORTH CAROLINA COURT OF APPEALS

3. Cited by:
Meehan v. Cable, 127 N.C. App. 336, 489 S.E.2d 440, 1997 N.C. App. LEXIS 883 (1997) LexisNexis Headnotes HN4

127 N.C. App. 336 p.340
489 S.E.2d 440 p.444
4. Cited by:
In re Foreclosure of Land Covered by a Certain Deed of Trust Given by Aal-Anubiaimhotepokorohamz, 123 N.C. App. 133, 472 S.E.2d 369, 1996 N.C. App. LEXIS 562 (1996) LexisNexis Headnotes HN4

123 N.C. App. 133 p.135
472 S.E.2d 369 p.370
5. Cited by:
In re Foreclosure of the Deed of Trust by Kitchens, 113 N.C. App. 175, 437 S.E.2d 511, 1993 N.C. App. LEXIS 1301 (1993) LexisNexis Headnotes HN4

113 N.C. App. 175 p.177
437 S.E.2d 511 p.512
6. Cited in Dissenting Opinion at:
In re Michael Weinman Assoc., 103 N.C. App. 756, 407 S.E.2d 288, 1991 N.C. App. LEXIS 932 (1991) LexisNexis Headnotes HN4

103 N.C. App. 756 p.762
407 S.E.2d 288 p.291
7. Cited by:
United Carolina Bank v. Tucker, 99 N.C. App. 95, 392 S.E.2d 410, 1990 N.C. App. LEXIS 490 (1990) LexisNexis Headnotes HN4

99 N.C. App. 95 p.98
392 S.E.2d 410 p.411
8. Cited by:
In re Fortescue, 75 N.C. App. 127, 330 S.E.2d 219, 1985 N.C. App. LEXIS 3604 (1985) LexisNexis Headnotes HN4

75 N.C. App. 127 p.131
330 S.E.2d 219 p.222
4TH CIRCUIT - U.S. DISTRICT COURTS

9. Cited by:
Merrill Lynch Bus. Fin. Servs. v. Cobb, 2008 U.S. Dist. LEXIS 109010 (E.D.N.C. Mar. 18, 2008) LexisNexis Headnotes HN4

2008 U.S. Dist. LEXIS 109010
4TH CIRCUIT - U.S. BANKRUPTCY COURTS

10. Cited by:
In re Di Cello, 80 B.R. 769, 1987 Bankr. LEXIS 1983, 16 Bankr. Ct. Dec. (LRP) 1203 (Bankr. E.D.N.C. 1987) LexisNexis Headnotes HN4

80 B.R. 769 p.772
ANNOTATED STATUTES ( 2 Citing Statutes )

11. N.C. Gen. Stat. sec. 45-21.16

12. N.C. Gen. Stat. sec. 45-21.34

TREATISE CITATIONS ( 4 Citing Sources )

13. 2-10 Brandis and Broun on North Carolina Evidence @ 255

14. 1-13 Webster's Real Estate Law in North Carolina @ 13-27

15. 1-13 Webster's Real Estate Law in North Carolina @ 13-31

16. 1-13 Webster's Real Estate Law in North Carolina @ 13-32

BRIEFS ( 3 Citing Briefs )

17. SOUTHERN BANK & TRUST CO. v. ERADER, 2007 NC App. Ct. Briefs 1106, 2007 NC App. Ct. Briefs LEXIS 1129 (N.C. Ct. App. Nov. 19, 2007)

18. In re THE FORECLOSURE OF A CERTAIN DEED OF TRUST WOODARD, 2006 NC App. Ct. Briefs 1243, 2007 NC App. Ct. Briefs LEXIS 802 (N.C. Ct. App. Mar. 27, 2007)

19. In re THE FORECLOSURE OF A CERTAIN DEED OF TRUST FROM WOODARD, 2006 NC App. Ct. Briefs 1243, 2006 NC App. Ct. Briefs LEXIS 759 (N.C. Ct. App. Dec. 4, 2006)

[dealingwithHomeEq]

127 N.C. App. 336, *; 489 S.E.2d 440, **;
1997 N.C. App. LEXIS 883, ***


JOHN THOMAS MEEHAN, Plaintiff v. DOROTHY ANN CABLE and K. REID BERGLUND, Trustee, Defendants

NO. COA96-1335

COURT OF APPEALS OF NORTH CAROLINA

127 N.C. App. 336; 489 S.E.2d 440; 1997 N.C. App. LEXIS 883

June 3, 1997, Heard in the Court of Appeals
September 2, 1997, Filed

PRIOR HISTORY: [***1] Appeal by plaintiffs from order entered 26 July 1996 by Judge James U. Downs in Macon County Superior Court.

DISPOSITION: Affirmed in part; reversed and remanded in part.

CASE SUMMARYPROCEDURAL POSTURE: Plaintiff buyer appealed an order of the Macon County Superior Court (North Carolina), which dismissed his claim that defendant sellers had demanded payment in excess of the amount owed, his request that the foreclosure proceedings be enjoined, his request for an accounting, his claim that the sellers were barred by waiver and estoppel from claiming default or acceleration payments, and his Fair Debt Collection Practices Act claim.

OVERVIEW: The buyer purchased a tract of property from the sellers. Thereafter, the buyer made irregular payments, and the sellers instituted foreclosure proceedings. On appeal, the court reversed the dismissal of the buyer's claims for an accounting, his request that the proceedings be enjoined and his claim that the sellers had demanded payment in excess of the amount owed. The court found that these claims if proven might have been a basis for an injunction against foreclosure pursuant to N.C. Gen. Stat. § 45-21.34. Thus, the court ruled that the trial court erred when it dismissed these claims for lack of jurisdiction. The court also held that the buyer could not maintain a Fair Debt Collection Practices Act, 15 U.S.C.S. § 1692, claim because such claims were limited to $ 1,000, and the buyer was seeking to recover more than the limit. The court further held that to the extent that the buyer's claims of waiver and estoppel were made to the trial court, the issues were not actually litigated or necessary to the judgment as required for collateral estoppel.

OUTCOME: The court reversed the part of the order, which dismissed the buyer's action to enjoin the foreclosure, obtain an accounting, and his assertion that he was not in default. The court also reversed the part of the order, which dismissed the buyer's claim that the sellers were barred by waiver and estoppel. However, the court affirmed the dismissal of the buyer's Fair Debt Collection Practices Act claim.
Judge COZORT dissenting.

COUNSEL: Jones, Key, Melvin, & Patton, P.A., by Richard Melvin, for plaintiff-appellant.

Creighton W. Sossomon for defendant-appellee.

JUDGES: TIMMONS-GOODSON, Judge. Judge MARTIN, Mark D. concurs. Judge COZORT dissents. Judge COZORT dissented prior to 31 July 1997.

OPINION BY: TIMMONS-GOODSON

OPINION

[**442] [*337] TIMMONS-GOODSON, Judge.

On 27 August 1985, plaintiff John Thomas Meehan purchased a tract of land with a summer house in Highlands, North Carolina from defendant Dorothy Ann Cable. To secure the unpaid portion of the purchase price, plaintiff executed a purchase money note and deed of trust providing for annual payments to be applied first toward the interest and the remainder toward the principal. Plaintiff made inconsistent payments until 9 August 1993, at which point defendants filed a petition to foreclose and gave notice of a hearing pursuant to North Carolina General Statutes section 45-21.16. The petition was granted by the clerk of superior court, upheld by the superior court on appeal de novo, and [***2] again upheld on appeal to this Court. To prevent foreclosure, plaintiff was required to deposit with the clerk of superior court a sum representing the amount due under the note as alleged by defendants.

In a separate action pursuant to North Carolina General Statutes section 45-21.34, plaintiff filed a complaint in the Superior Court of Macon County alleging that defendants had demanded payment in excess of the amount owed, seeking to enjoin the foreclosure proceedings, and requesting a proper accounting. Plaintiff subsequently filed two amended complaints in which he claimed, in pertinent part, that he was not in default; that his account was entitled to certain credits; that defendants' actions were in violation of the federal "Fair Debt Collection Practices Act," 15 U.S.C.A. § 1692 (1982); that defendants were barred by principles of waiver and estoppel from either claiming default or accelerating payments; and that defendants had anticipatorily breached the terms of the note.

[*338] After hearing the arguments of both parties and examining the evidence, the trial court dismissed all of the claims alleged in the original complaint for lack of jurisdiction, stating that [***3] they were "properly before the Clerk of Superior Court as part of the foreclosure proceeding." In addition, the trial court dismissed plaintiff's claim under the federal "Fair Debt Collection Practices Act" for lack of jurisdiction. With regard to plaintiff's first amended complaint, the trial court dismissed the claims therein for lack of jurisdiction as well. Finally, the trial court dismissed all claims made in plaintiff's second amended complaint based on defendants' plea of res judicata and collateral estoppel. Plaintiff appeals.

Plaintiff's first assignment of error is that the trial court erred in dismissing his claims based on lack of jurisdiction. We agree and remand this action to the superior court.

HN1North Carolina General Statutes section 45-21.34 provides that:
Any owner of real estate, or other person, firm or corporation having a legal or equitable interest therein, may apply to a judge of the superior court, prior to the time that the rights of the parties to the sale or resale becoming fixed pursuant to G.S. 45-21.29A to enjoin such sale, upon the ground that the amount bid or price offered therefor is inadequate and inequitable and will result in irreparable [***4] damage to the owner or other interested person, or upon any other legal or equitable ground which the court may deem sufficient . . . .
N.C. Gen. Stat. § 45-21.34 (1996)(emphasis added). Moreover, the notice and hearing provided for under North Carolina General Statutes section 45-21.16
were designed to enable the mortgagor to utilize the injunctive relief already available in G.S. 45-21.34. The hearing was not intended to settle all matters in controversy between mortgagor and mortgagee, nor was it designed to provide a second procedure for invoking equitable relief.
In re Watts, 38 N.C. App. 90, 94, 247 S.E.2d 427, 429 (1978). HN2"The proper method for [**443] invoking equitable jurisdiction to enjoin a foreclosure sale is by bringing an action in the Superior Court pursuant to G.S. 45-21.34." Id. (citations omitted); see also Golf Vistas v. Mortgage Investors, 39 N.C. App. 230, 249 S.E.2d 815 (1978). In Golf Vistas, a case similar to the present case, this Court held that, after a foreclosure proceeding had been initiated by special hearing under [*339] section 45-21.16, plaintiff was entitled to pursue claims that there was no [***5] default and that part of the property had been released from the deed of trust in a civil action to enjoin the foreclosure under section 45-21.34. 39 N.C. App. 230, 249 S.E.2d 815.

In the case sub judice, plaintiff argues in his original and first amended complaints that the foreclosure should be enjoined because he is not in default, and that allowing the foreclosure to proceed without an accurate accounting would force plaintiff to pay defendants more than they are due, in order to prevent a sale of the property. We find that these claims, if proven, might be a basis for an injunction against foreclosure and, as such, are within the jurisdiction of the superior court in an action pursuant to North Carolina General Statutes section 45-21.34. Accordingly, the trial court erred in concluding that it lacked jurisdiction to hear these claims and that they were properly addressed before the clerk of court in the foreclosure proceeding.

In his second assignment of error, plaintiff argues that the trial court erred in dismissing his claim under the federal "Fair Debt Collection Practices Act," 15 U.S.C.A. § 1692, for lack of jurisdiction. We disagree.

HN3North Carolina General Statutes [***6] section 7A-243 provides that the superior court is the proper division for trial in a civil action where the amount in controversy exceeds $ 10,000. N.C. Gen. Stat. § 7A-243 (1995). However, under 15 U.S.C.A. § 1692, statutory damages are limited to $ 1,000 per proceeding. 15 U.S.C.A. § 1692k(a)(2)(A). Accordingly, as plaintiff's only other claims were for the equitable remedies of injunction and accounting, the trial court correctly determined that it was without jurisdiction to hear the claim.

In his final assignment of error, plaintiff argues that the trial court erred in dismissing his second amended complaint based on the doctrines of res judicata and collateral estoppel. We agree and hold that these issues should be remanded to the court below for consideration on the merits.

First, we note that the issue is properly one of collateral estoppel, not res judicata. HN4Res judicata applies only when the present action involves the same parties and the same claims as the prior action; whereas, collateral estoppel may apply where the same parties appear with different claims. See Chrisalis Properties, Inc. v. Separate Quarters, Inc., 101 N.C. App. 81, 398 S.E.2d 628 (1990), [***7] [*340] disc. rev. denied, 328 N.C. 570, 403 S.E.2d 509 (1991). As we have already noted, plaintiff's claims for an injunction pursuant to section 45-21.34 of the General Statutes are not claims which could have been brought in the prior action under section 45-21.16 and, thus, are different claims for purposes of res judicata.

HN5The elements of collateral estoppel, as stated by our Supreme Court, are as follows: (1) a prior suit resulting in a final judgment on the merits; (2) identical issues involved; (3) the issue was actually litigated in the prior suit and necessary to the judgment; and (4) the issue was actually determined. Thomas M. McInnis & Associates, Inc. v. Hall, 318 N.C. 421, 349 S.E.2d 552 (1986). Moreover, this Court has recently held that where the court adjudicating the prior proceeding lacked jurisdiction over an issue, the third element of collateral estoppel has not been met. Alt v. John Umstead Hospital, 125 N.C. App. 193, 479 S.E.2d 800, disc. rev. denied, 345 N.C. 639, 483 S.E.2d 702 (1997); see also In re Canal Co., 234 N.C. 374, 377, 67 S.E.2d 276, 278 (1951)(noting that "[a] judgment entered by a clerk of the Superior Court in a special [***8] proceeding in which such clerk had jurisdiction, will stand as a judgment of the court . . . ." (emphasis added)).

It is well established that HN6a clerk of court is without jurisdiction to consider equitable defenses in a foreclosure hearing pursuant [**444] to section 45-21.16 of the General Statutes.
According to G.S. 45-21.16, . . . there are only four issues before the clerk at a foreclosure hearing: the existence of a valid debt of which the party seeking to foreclose is the holder, the existence of default, the trustee's right to foreclose, and the sufficiency of notice to the record owners of the hearing. . . . the judge has no equitable jurisdiction and cannot enjoin foreclosure upon any ground other than the ones stated in G.S. 45-21.16.
In re Helms, 55 N.C. App. 68, 71-72, 284 S.E.2d 553, 555 (1981), disc. rev. denied, 305 N.C. 300, 291 S.E.2d 149 (1982) (citations omitted). HN7"Equitable defenses to foreclosure, such as waiver of the right to prompt payment through acceptance of late payments, may not be raised in a hearing pursuant to N.C.G.S. § 45-21.16 or on appeal therefrom but must be asserted in an action [***9] to enjoin the foreclosure sale under N.C.G.S. § 45-21.34." In re Foreclosure of Goforth Properties, Inc., 334 N.C. 369, 374, 432 S.E.2d 855, 859 (1993)(emphasis added); see also In re Foreclosure of Fortescue, 75 N.C. App. 127, 330 S.E.2d 219 (1985) (holding that [*341] respondent's argument on waiver was not properly addressed in an action pursuant to section 45-21.16, but must be pursued in an action under section 45-21.34). In the foreclosure hearing in the instant case, to the extent that such arguments were made before the clerk of court, or before the superior court upon appeal de novo, the issues raised by plaintiff were not "actually litigated" or "necessary to the judgment" as required for collateral estoppel.

In light of the foregoing, we affirm the decision of the superior court with regard to lack of jurisdiction over plaintiff's claim under 15 U.S.C.A. § 1692. However, we reverse the superior court's decision and remand this case for a hearing on plaintiff's requests for an injunction and accounting, and for consideration of plaintiff's equitable claims of waiver, estoppel, substitution and novation.

Affirm in part; reverse and remand in part.

Judge [***10] MARTIN, Mark D. concurs.

Judge COZORT dissents.

Judge COZORT dissented prior to 31 July 1997.

DISSENT BY: COZORT

DISSENT

Judge COZORT dissenting.

I vote to dismiss plaintiff's appeal.

Rule 10(c)(1) of the North Carolina Rules of Appellate Procedure states, in part: "Each assignment of error shall, so far as practicable, be confined to a single issue of law; and shall state plainly, concisely and without argumentation the legal basis upon which error is assigned." N.C.R. App. P. 10(c)(1) (1997).

Plaintiff's assignments of error state:

Plaintiff/Appellant, John Thomas Meehan respectfully assigns the following errors:

1. Paragraph 1 of the Order of the Honorable James U. Downs dated July 25, 1996.

EXCEPTION No. 1, R. p. 20.

2. Paragraph 2 of the Order of the Honorable James U. Downs dated July 25, 1996.

EXCEPTION No. 2, R. p. 20.

[*342] 3. Paragraph 3 of the Order of the Honorable James U. Downs dated July 25, 1996.

EXCEPTION No. 3, R. p. 21.

These assignments of error completely fail to state any "legal basis upon which error is assigned." Failure to follow the Rules of Appellate Procedure regarding the form of assignments of error subjects an appeal to dismissal. Bustle v. Rice, [***11] 116 N.C. App. 658, 449 S.E.2d 10 (1994); State v. Thomas, 332 N.C. 544, 423 S.E.2d 75 (1992). Our rules were not written to be ignored by the parties or this Court. This appeal should be dismissed.