Mattie Stephens v. HSBC Mortgage Services, Inc

Filing

UNPUBLISHED PER CURIAM OPINION filed. Originating case number: 3:13-cv-00691-RMG Copies to all parties and the district court/agency. [999331781].. [13-1894]

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UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT

No. 13-1894

MATTIE P. STEPHENS, and all others similarly situated,
Plaintiff – Appellant,
v.
HSBC
MORTGAGE
SERVICES,
REGISTRATION SYSTEMS, INC.,
lender,

INC.;
MORTGAGE
as mortgagee and

ELECTRONIC
nominee of

Defendants – Appellees.

Appeal from the United States District Court for the District of
South Carolina, at Columbia. Richard M. Gergel, District Judge.
(3:13-cv-00691-RMG)

Submitted:

March 28, 2014

Decided:

April 8, 2014

Before TRAXLER, Chief Judge, DUNCAN, Circuit Judge, and DAVIS,
Senior Circuit Judge.

Affirmed by unpublished per curiam opinion.

Richard A. Harpootlian, Christopher P. Kenney, RICHARD A.
HARPOOTLIAN, PA, Columbia, South Carolina; Tobias G. Ward, Jr.,
TOBIAS G. WARD, JR. PA, Columbia, South Carolina, for Appellant.
B. Rush Smith III, Thad H. Westbrook, A. Mattison Bogan, Carmen
Harper Thomas, NELSON MULLINS RILEY & SCARBOROUGH LLP, Columbia,
South Carolina, for Appellees.

Unpublished opinions are not binding precedent in this circuit.

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PER CURIAM:
Appellant

Mattie

Stephens

appeals

the

district

dismissal of her motion for declaratory judgment. 1

court's

She contends

that the district court erred by finding that her claim was not
ripe for adjudication and abused its discretion by failing to
show good cause for its refusal to consider her motion on the
merits.

For the reasons that follow, we affirm.

I.
Stephens is a South Carolina homeowner who is currently
delinquent on her mortgage payments.
Services,

Inc.

is

the

assignee

Appellee HSBC Mortgage

of

the

lender’s

rights

to

Stephens’s mortgage contract, and Appellee Mortgage Electronic
Registration

Systems,

Inc.

holds

a

security

interest

as

mortgagee and nominee for the lender.
Stephens alleges that due to financial distress, she has
made only partial mortgage payments for approximately two years.
She seeks a declaration that her mortgage contract is void ab
initio

because

it

includes

an

improper

waiver

of

the

appraisement rights granted by South Carolina Code § 29-3-680 to
1

Stephens also appeals
motion to certify state law
South Carolina and moves
Stephens’s appeal and motion
of September 27, 2013.

the district court’s denial of her
questions to the Supreme Court of
us to certify those questions.
were previously denied in our order

2

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homeowners whose mortgages have been foreclosed and against whom
a deficiency judgment has been sought.

She also seeks to enjoin

Appellees

her

property

the

allegedly

deficiency
contract.
similarly

from

foreclosing

judgment
Finally,

pursuant

on
to

situated

Stephens
South

seeks

Carolina

to

or

void

represent

homeowners

seeking

a

whose

contracts include the allegedly improper waiver.

a

mortgage
class

of

mortgage

Stephens does

not contend that either Appellee has threatened or initiated
foreclosure proceedings.
Stephens filed this action for declaratory and injunctive
relief in South Carolina state court on January 25, 2013.

On

March 14, 2013, Appellees removed the case to the District of
South Carolina.

Appellees moved to dismiss Stephens's action

for lack of subject-matter jurisdiction on March 21, 2013.

The

district court granted Appellees' motion to dismiss on June 24,
2013.

Stephens timely appealed.

II.
“We review de novo the issue of whether a district court
possessed

jurisdiction

in

a

declaratory

judgment

proceeding.”

Volvo Constr. Equip. N. Am., Inc. v. CLM Equip. Co., 386 F.3d
581,

591

(4th

Cir.

2004).

“If

a

plaintiff

has

asserted

sufficient facts to create declaratory judgment jurisdiction, we

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review for abuse of discretion a district court's decision to
exercise its jurisdiction.”

Id.

III.
The district court held that Stephens’s cause of action was
not ripe, and therefore not justiciable, because it is uncertain
whether

her

challenged.

right

to

appraisement

will

ever

be

asserted

or

The court found that because Stephens's ability to

exercise her right was subject to multiple unpredictable future
contingencies, a declaration would not be useful and the lack of
a declaration would not impose any significant hardship on the
parties.
Article III, § 2 of the United States Constitution limits
our jurisdiction to cases and controversies.

A claim satisfies

the

“if

the

a

real,

case

or

contentions

controversy

of

the

requirement

parties...present

‘conflicting
substantial

controversy between parties having adverse legal interests, a
dispute definite and concrete, not hypothetical or abstract.’”
Miller v. Brown, 462 F.3d 312, 316 (4th Cir. 2006) (quoting
Babbitt v. United Farm Workers Nat'l Union, 442 U.S. 289, 298
(1979)) (alteration in original).
ripeness

prevents

controversy

is

form...problems

judicial

consideration

presented
such

as

“Because [t]he doctrine of

the

in

clean-cut

inadequacy
4

of

of

issues
and
the

until

a

concrete
record...or

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ambiguity

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in

the

record...will

adjudication on the merits.”
263,

288

(4th

Cir.

Pg: 5 of 7

2010)

make

merits

of

a

case

unfit

for

Ostergren v. Cuccinelli, 615 F.3d
(alteration

quotation marks and citations omitted).
the

a

declaratory

in

original)

(internal

A court should rule on

judgment

action

only

“when

declaratory relief ‘will serve a useful purpose in clarifying
and settling the legal relations in issue,’ and ‘will terminate
and

afford

controversy

relief
giving

from
rise

to

the

uncertainty,

the

proceeding.’”

insecurity,
Volvo

and

Constr.

Equip., 386 F.3d at 594. (quoting Aetna Cas. & Sur. Co. v.
Quarles, 92 F.2d 321, 325 (4th Cir. 1937)).
Stephens contends that her declaratory judgment action is
ripe because all of the relevant facts are before the court, she
has already been injured by the formation of the illegal clause
in the contract, the parties have taken adverse positions on the
enforceability of the contract, and the Appellees have a present
right to foreclose on Stephens’s property. 2

Appellees argue that

Stephens’s claim is not ripe because she has no right to the
relief she seeks unless a series of contingent events occur.

2

Stephens also contends that the existence of 500 or more
similarly situated homeowners is a factor that helps her claim
to satisfy the ripeness standard. However, it is not clear why
this would have any bearing on the existence of a controversy
between Stephens and the Appellees.

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Stephens’s arguments are unavailing.

We have previously

held that a challenge to a lender’s ability to foreclose on a
mortgage contract is not ripe when there has been “no attempt to
foreclose.”

Horvath v. Bank of N.Y., 641 F.3d 617, 622 n.2 (4th

Cir. 2011).

The claim before us and the claim in Horvath are in

identical

postures.

In

Horvath,

as

in

this

action,

the

plaintiff challenged the enforceability of a mortgage contract
on which the parties had taken adverse positions and for which
there were sufficient facts in the record to allow the court to
make a decision as a matter of law.

Moreover, the defendants

had a present right to enforce the mortgage contract at issue
because the plaintiff was in default.
declaratory

judgment

stating

that

The plaintiff “sought a
[the

defendant]

cannot

foreclose on the note, even though [the plaintiff] is in default
and even though the current noteholder has made no attempt to
foreclose.”

Id. at 622 n.2.

We held that the “claim [was]

unripe for adjudication.

Insofar as no foreclosure has even

been

plaintiff]

threatened,

[the

cannot

yet

show

a

‘controversy...presented in [a] clean-cut and concrete form.’”
Id.

(quoting Ostergren, 615 F.3d at 288).
Stephens cannot overcome the fact that no foreclosure has

been

threatened

Like

the

or

plaintiff

initiated
in

by

Horvath,

the

Appellees

Stephens

in

seeks

this
an

case.

advisory

declaration that the Appellees cannot foreclose on the mortgage
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contract even though she is in default and the Appellees have
made no attempt to foreclose.

Because the claim presented by

Stephens is no more clean-cut or concrete than that presented in
Horvath, there is no sufficiently ripe controversy to permit the
exercise of declaratory judgment jurisdiction. 3

IV.
For

the

reasons

stated

above,

the

district

court’s

dismissal of Stephens’s action for declaratory relief is
AFFIRMED.

3

Because the district court properly found that it lacked
jurisdiction, we need not consider whether it abused its
discretion by choosing not to consider Stephens’s claim on the
merits.

7