In 2021, the foreclosing trustee was an attorney working at the same firm that had represented both parties in the underlying real estate transaction in 2006; nevertheless, the trustee was neutral.
We affirm the trial court’s order authorizing foreclosure.
Attorney Jeff Rogers was not prohibited from serving as substitute trustee despite his firm’s involvement in the real estate transaction for the subject property in 2006.
The respondent-borrower contends the firm, Smith Debnam, “in violation of the conflict rules, sent adverse collection letters to [respondent] (a former client), on behalf of [the petitioner-lender] (a former client), related to the seller financing on the property at the prior closing.” We are not persuaded.
N.C. RPC 3 expressly provides that a potential conflict only arises if the substitute trustee were to represent either party in the contested foreclosure proceedings and there’s a concern of confidentiality or “the attorney would be put in the position of inconsistent roles or obligations[.]” Here, the substitute trustee did not engage in the representation of either party in the contested foreclosure.
Rogers did not send debt collection letters signed “Attorney at Law” nor state he was retained by the noteholders to initiate the foreclosure proceeding. In fact, he included a notice of trustee neutrality when he notified respondent of the impending foreclosure and, when the matter became contested, Rogers remained neutral and petitioner retained separate counsel. Furthermore, upon review of the hearing’s transcript, there’s no indication that Rogers affirmatively acted on behalf of petitioner. In the absence of evidence indicating Rogers improperly advocated for petitioner throughout the foreclosure proceedings, respondent’s argument is overruled.
Even though the promissory note secured by the deed of trust matured in 2007, since the borrower made payments on the note between 2014 and 2021, the 10-year statute of limitations did not bar foreclosure in 2021.
In re Almanzar (Lawyers Weekly No. 012-212-23, 9 pp.) (John Arrowood, J.) Appealed from Wake County Superior Court (Craig Croom, J.) Alan Powell and Andrew Irby for petitioner; Edward Dilone for respondent. North Carolina Court of Appeals (unpublished)