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In Turner v. Wells Fargo, N.A., No. 2150230, Wells Fargo foreclosed on a home after the homeowners tendered a bad check and attempted to send catch-up payments that did not include required penalty fees.  Wells Fargo, which purchased the home in foreclosure, obtained summary judgment in the trial court after initiating an ejectment action against the former owners. On appeal, the Alabama Court of Civil Appeals affirmed the summary judgment, holding that Wells Fargo had substantially complied with the terms of the mortgage and was therefore entitled to initiate the foreclosure.

In 2006, Donna Turner and Trenton Turner, Jr. executed a promissory note and mortgage for the purchase of a home. The note was eventually sold to Wells Fargo, and Carrington Mortgage Services serviced the loan.  In 2011, the Turners tendered checks to Carrington that were returned due to insufficient funds. The Turners ultimately satisfied the principal and interest payments, but Carrington assessed several penalty fees for the bad checks.  The Turners repeatedly sent checks that were sufficient to pay the principal and interest, but Carrington returned these checks because they were not sufficient to pay the mounting penalty fees.

In late 2011, Carrington notified the Turners of its intent to foreclose, and in early 2012, Wells Fargo accelerated the mortgage and sent the Turners a notice of foreclosure.  Wells Fargo ultimately purchased the home at a foreclosure sale. Because the Turners refused to vacate the home, Wells Fargo filed a complaint for ejectment. The trial court entered summary judgment in favor of Wells Fargo, and the Turners appealed to the Alabama Court of Civil Appeals.

Specifically, the Turners contended that Carrington caused the default by returning the checks that were tendered in 2011, that Wells Fargo failed to provide sufficient notice pursuant to the terms of the mortgage contract, and that Wells Fargo failed to show it was the holder of the note. The Court rejected all three arguments. First, the Turners admitted that they neglected to send Carrington checks that were sufficient to cover the penalty fees that accrued in 2011, and they did not dispute that the note allowed for such fees. Thus, the Court held that, under the terms of the note, Carrington was entitled to return the insufficient checks, and the Turners failed to cure their default.  Second, the Turners asserted that, because the notice of foreclosure sent by Wells Fargo did not contain the precise notice language included in the mortgage contract, the foreclosure was void.  The Court disagreed, holding that the notices substantially complied with the mortgage’s notice requirements. Therefore, the Court held that there was no genuine issue of fact supporting the Turner’s claim that they did not receive proper notice. Finally, the Turners contended that Wells Fargo did not produce substantial evidence that it was the holder of the note and mortgage. However, Wells Fargo presented to the trial court an executed assignment of the mortgage and note, which was recorded in the probate court prior to the foreclosure. Thus, the Court held that Wells Fargo did, in fact, present substantial evidence that it was the holder of the mortgage and was entitled to foreclose. Accordingly, the Court affirmed the trial court’s judgment.