Garrison et al v. CitiMortgage Incorporated et al

Filing 14

ORDER granting the Bannk's 9 motion to dismiss. Because no amendment could remedy the complaint's deficiencies, the motion to dismiss is granted with prejudice. The clerk shall enter final judgment. Signed by Judge Frederick J Martone on 10/05/11.(ESL)

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IN THE UNITED STATES DISTRICT COURT

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FOR THE DISTRICT OF ARIZONA

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Ronald Garrison; Beverly Garrison,
Plaintiffs,

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vs.

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CitiMortgage Inc.,
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Defendant.
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No. CV-11-1392-PHX-FJM
ORDER

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The court has before it defendant CitiMortgage, Inc.’s (the “Bank”) motion to dismiss

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(doc. 9), plaintiff’s response (doc. 11), the Bank’s reply (doc. 12), and the plaintiffs’ “reply”

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(doc. 13), which is not authorized by the federal or local rules of civil procedure.

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Plaintiffs executed a promissory note in the original principal amount of $545,000 in

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favor of lender ABN AMRO Mortgage Group, Inc. As security for the note, plaintiffs

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executed a deed of trust, which encumbers property located in Desert Hills, Arizona. The

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deed of trust allows for a sale of the note and interest in the deed of trust without notice to

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plaintiffs. Compl., ex. D, ¶ 20. On September 25, 2006, ABN assigned “all beneficial

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interest in and title to said Deed of Trust, together with the note” to CitiMortgage. Motion,

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ex. B.1 The assignment was recorded on October 19, 2006, in the Office of the Maricopa

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County Recorder.

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Plaintiffs filed this complaint asserting three claims for relief: fraudulent

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misrepresentation, unjust enrichment, and quiet title. The Bank now moves to dismiss the

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complaint (doc. 9).

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Plaintiffs do not allege any details of fraudulent misrepresentation by the Bank.

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Instead, they simply assert that the Bank “knowingly and intentionally concealed material

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information from Plaintiff’s [sic], which are required by Federal Statutes and Regulations to

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be disclosed to the Plaintiff’s [sic].” Complaint ¶ 44. Rule 9(b), Fed. R. Civ. P., requires

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a plaintiff to plead fraud with particularity, including “the time, place, and specific content

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of the false representations as well as the identities of the parties to the misrepresentation.”

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Edwards v. Marin Park, Inc., 356 F.3d 1058, 1066 (9th Cir. 2004). Because plaintiffs do not

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allege any detail to support a claim for fraudulent misrepresentation, the Bank’s motion to

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dismiss this claim is granted.

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The Bank also moves to dismiss the claim for unjust enrichment. In order to establish

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unjust enrichment, a plaintiff must show (1) an enrichment, (2) an impoverishment, (3) a

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connection between the two, (4) the absence of a justification, and (5) the absence of a

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remedy at law. Freeman v. Sorchych, 226 Ariz. 242, 245 P.3d 927, 936 (Ct. App. 2011).

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Plaintiffs allege that the Bank has received undefined payments from third parties including

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the United States and Bank of America, but they do not allege any connection between the

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payments and any impoverishment they may have suffered. Moreover, because plaintiffs’

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claims are based on a contract, namely the deed of trust and note, they have a remedy at law.

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The claim for unjust enrichment is dismissed.

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Finally, plaintiffs assert a claim for quiet title. However, a borrower cannot move to

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quiet title without first offering to repay the debt secured by the trust deed on the property.

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We take judicial notice of matters of public record without converting a motion to
dismiss into a motion for summary judgment. See Fed. R. Civ. P. 12(d); Mir v. Little Co.,
844 F.2d 646, 649 ( 9th Cir. 1988).
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Farrell v. West, 57 Ariz. 490, 491, 114 P.2d 910, 911 (1941). Because plaintiffs have neither

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paid nor tendered the balance due on the debt, quiet title is not an available remedy.

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Plaintiffs’ claims are premised on the legal theories challenging the legitimacy of the

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securitization process, the failure to record assignments of the deed of trust, which they argue

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invalidates the underlying note obligation, and other versions of the “show me the note”

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theory. These claims have been consistently rejected in this district. See, e.g., Mansour v.

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Cal-Western Reconveyance Corp., 618 F. Supp. 2d 1178, 1181 (D. Ariz. 2009) (collecting

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cases). The terms of plaintiffs’ deed of trust expressly provide that the deed of trust and the

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note may be transferred without notice to the plaintiffs. Complaint, ex. D ¶ 20. Moreover,

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contrary to plaintiffs’ arguments, the Arizona Uniform Commercial Code (“UCC”)

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provisions regarding negotiable instruments do not apply to non-judicial foreclosures under

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deeds of trust. Diessner v. Mort. Elec. Reg. Sys., 618 F. Supp. 2d 1184, 1186 (D. Ariz.

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2009). Plaintiffs’ assertions fail to state a claim upon which relief can be granted.

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Therefore, IT IS ORDERED GRANTING the Bank’s motion to dismiss (doc. 9).

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Because no amendment could remedy the complaint’s deficiencies, the motion to dismiss is

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granted with prejudice. The clerk shall enter final judgment.

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DATED this 5th day of October, 2011.

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