Case: 13-10342       Document: 00512455874         Page: 1     Date Filed: 11/29/2013




           IN THE UNITED STATES COURT OF APPEALS
                    FOR THE FIFTH CIRCUIT  United States Court of Appeals
                                                    Fifth Circuit

                                                                            FILED
                                                                        November 29, 2013

                                     No. 13-10342                          Lyle W. Cayce
                                   Summary Calendar                             Clerk



ARMANDO GONZALEZ; ANGELINA GONZALEZ,

                                                  Plaintiffs - Appellants,

v.

U.S. BANK NATIONAL ASSOCIATION AS TRUSTEE FOR RASC
2004KS12, By and through its servicer-in-fact GMAC Mortgage, L.L.C.,

                                                  Defendant - Appellee.


                   Appeal from the United States District Court
                        for the Northern District of Texas
                             USDC No. 3:12-CV-1131


Before KING, DAVIS, and ELROD, Circuit Judges.
PER CURIAM:*
       Armando and Angelina Gonzalez (“the Gonzalezes”) sued U.S. Bank
National Association (“U.S. Bank”), alleging that U.S. Bank forfeited all
principal and interest on the loan that it made to the Gonzalezes because the
loan violated certain provisions of the Texas Constitution. The district court
granted summary judgment and denied the Gonzalezes’ request for declaratory


       *
         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 R. 47.5, the court has determined that this opinion should not
be published and is not precedent except under the limited circumstances set forth in 5TH CIR.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.
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                                  No. 13-10342

judgment. We AFFIRM.
                                        I.
      The Gonzalezes refinanced their homestead in 2004. They took out a
$96,000 loan by executing a note in favor of what is now U.S. Bank, and a deed
of trust in favor of Mortgage Electronic Registration Systems, Inc., as nominee.
At the time the loan was executed, the Gonzalezes acknowledged in a notarized
affidavit, as part of the homestead refinancing process outlined in the Texas
Constitution, that the fair market value of their home at the time was $120,000.
This “Acknowledgment” was based on and incorporated a reference to a
property appraisal that was paid for by the Gonzalezes during the closing
process. The Gonzalezes also received a tax appraisal from the Dallas Central
Appraisal District (“DCAD Tax Appraisal”) that valued their home at $110,750
for property tax purposes. Despite having the DCAD Tax Appraisal at the time
the loan closed, the Gonzalezes did not dispute that the fair market value of
their homestead was $120,000.
      In December 2011, U.S. Bank attempted to foreclose on the Gonzalezes’
residence.   The Gonzalezes sued U.S. Bank, alleging that their loan was
extended in violation of certain provisions of the Texas Constitution, art. XVI,
section 50, and that the foreclosure based on that loan also violated the Texas
Constitution. The Gonzalezes sought damages and a declaratory judgment.
The district court found no violations of the Texas Constitution, and granted
summary judgment in favor of U.S. Bank on all claims.
      On appeal the Gonzalezes argue that a genuine issue of material fact
exists as to the fair market value of the home in 2004, and therefore the district
court erred in granting summary judgment. The Gonzalezes also appeal the


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                                      No. 13-10342

district court’s denial of declaratory judgment.2
                                              II.
       The Texas Constitution allows liens on a homestead in specific situations
and pursuant to several conditions, including that extensions of credit may not
exceed 80% of the fair market value of the homestead on the date the extension
of credit is made. TEX. CONST. art. XVI, § 50(a)(6)(B). Lenders may conclusively
rely on a written acknowledgment by the property owner as to the fair market
value of the homestead when it matches the value estimate in an appraisal
prepared in accordance with state requirements for an extension of credit. TEX.
CONST. art. XVI, § 50(h). Lenders may not rely on such an acknowledgment,
however, if they have actual knowledge that the fair market value included is
incorrect. TEX. CONST. art. XVI, § 50(h)(2). The remedy for a violation is
forfeiture of all principal and interest. TEX. CONST. art. XVI, § 50(a)(6)(Q)(x).
       The    Gonzalezes      first   argue       that   U.S.   Bank    knew     that    the
Acknowledgment was incorrect and unreliable because the fair market value
contained in the Acknowledgment differed from the 2004 DCAD Tax Appraisal.
However, U.S. Bank’s knowledge of the DCAD Tax Appraisal is not evidence
that the fair market value included in the Acknowledgment was incorrect
because “under Texas law, tax valuations are legally insufficient evidence of
fair-market value.” United States v. Curtis, 

, 718 (5th Cir. 2011);
see Poswalk v. GMAC Mortg., L.L.C., 519 F. App’x 884, 886 (2013) (unpublished
but persuasive) (observing that in Texas a plaintiff could not rely on a tax


       2
         The Gonzalezes did not raise on appeal their argument before the district court that
the fees on the loan exceeded 3% of the loan amount, in violation of the Texas Constitution,
article XVI, section 50(a)(6)(E). Therefore, we do not consider it.

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                                  No. 13-10342

valuation to establish a defendant’s knowledge that a loan acknowledgment was
incorrect); Thornton v. GMAC Mortg., L.L.C., No. 13-10362, 

,
at *1 (5th Cir. Oct. 9, 2013) (unpublished but persuasive) (observing that under
Texas law a tax appraisal was not “competent evidence” that a defendant knew
that a loan acknowledgment was incorrect).
      The Gonzalezes next argue that Mr. Gonzalez’s 2012 affidavit that the
fair market value of his home in 2004 was $110,750 creates a fact issue. The
district court disregarded the 2012 affidavit because it determined that the
affidavit was conclusory and unsubstantiated. Even assuming arguendo that
the district court was incorrect and Mr. Gonzalez’s 2012 affidavit could be some
evidence of the market value of his home in 2004, the argument is unavailing.
The 2012 affidavit does not establish that U.S. Bank had any actual knowledge
that Mr. Gonzalez valued his home at that amount in 2004 and is insufficient
to create a fact issue. See Thornton, No. 13-10362, 

, at *1 (5th
Cir. Oct. 9, 2013) (unpublished but persuasive) (observing that a plaintiff’s 2012
affidavit was insufficient to establish that the defendant knew a 2007
acknowledgment was incorrect); see also Poswalk, 519 F. App’x 884, 886 (2013)
(unpublished but persuasive) (observing that a plaintiff’s “self-serving”
testimony that he had a “feeling” about the market value of his home was
insufficient to establish that the defendant knew a prior acknowledgment was
incorrect).
      For the same reasons, the district court did not err when it declined the
Gonzalezes’ request to issue a declaratory judgment. AFFIRMED.




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