Bode v. Federal National Mortgage Insurance Association

Dallas Court of Appeals, No. 05-14-01086-CV (November 17, 2015)Justices Lang-Miers (Opinion), Brown, and Schenck

Fannie Mae foreclosed on a house in Collin County, but then leased it back to the prior owners for a time. When the former owners refused to vacate at the end of the lease, Fannie Mae brought a forcible detainer action to secure possession of the property. The former owners defended by arguing Fannie Mae lacked capacity to sue because it is a foreign corporation not registered to do business in the State of Texas. They relied on Texas Business Organizations Code § 9.051(b), which provides, “[a] foreign filing entity … may not maintain an action, suit, or proceeding in a court of this state … unless the foreign filing entity is registered in accordance with this chapter.” In response, Fannie Mae played its trump card: the Supremacy Clause of the United States Constitution. Under 12 U.S.C § 1723a(a), Congress granted Fannie Mae authority “to sue and be sued … in any court of competent jurisdiction, State or Federal,” and “to conduct its business without regard to any qualification or similar statute of any State of the United States.” The Court of Appeals held this statute supersedes and preempts the registration requirements of TBOC § 9.051(b); Fannie Mae therefore does have the capacity to sue in Texas, whether registered to do business here or not.