Wilson v. Wells Fargo Bank NA

Filing 17

ORDER denying Defendant's 7 Motion to Dismiss. Signed by Judge David G Campbell on 2/18/14.(REW)

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IN THE UNITED STATES DISTRICT COURT

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FOR THE DISTRICT OF ARIZONA

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Jeffrey H Wilson,

No. CV-13-08240-PCT-DGC
Plaintiff,

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v.

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ORDER

Wells Fargo Bank NA,

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Defendant.

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Defendant Wells Fargo Bank, N.A. has filed a motion to dismiss Plaintiff Jeffery

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Wilson’s cause of action for “mental anguish” pursuant to Rule 12(b)(6) of the Federal

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Rules of Civil Procedure. Doc. 7. The motion is fully briefed and no party has requested

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oral argument. For the reasons that follow, the Court will deny the motion.

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I.

Background.

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Plaintiff obtained a loan from Defendant in February 2004 in the amount of

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$116,200, secured by real property located at 5823 West Tierra Buena Lane, Glendale,

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Arizona. Doc. 7 at 1-2. Defendant appointed First American Title Insurance Company

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as successor trustee in December 2006. Id. Plaintiff allegedly defaulted on his payment

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obligations several times, leading First American to record a Notice of Trustee’s Sale on

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February 16, 2010. Id. The sale ultimately took place on December 14, 2010. Id.

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Plaintiff alleges that he was not in default at the time of the Trustee’s Sale and that

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the foreclosure was premature and unauthorized. Doc. 1-1, ¶ 8. The parties agree that

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Plaintiff received notice of the Trustee’s Sale on December 28, 2010. Id., ¶ 9; Doc. 7 at

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2. Plaintiff asserts that on or about April 26, 2013, he received a payment of $6,000 from

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the Office of the Attorney General of the State of Arizona and then, on June 12, 2013,

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received a payment of $1,484.20 “from a National Mortgage Settlement from Consent

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Judgment (sic) dated 4/4/12 . . . for unlawful foreclosure actions[.]” Id., ¶ 13. He further

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asserts that if he recovers from Defendant in this action “he will be required to reimburse

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the Arizona Attorney General office (sic) for the settlement he received.” Id.

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Plaintiff filed this complaint on July 21, 2013, asserting claims for unlawful

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foreclosure (Count One) and mental anguish (Count Two). See Doc. 1-1. Defendant has

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moved to dismiss Count Two on the ground that it is barred by the applicable statute of

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limitations. Doc. 7 at 1.

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II.

Legal Standard.

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When analyzing a complaint for failure to state a claim, the well-pled factual

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allegations are taken as true and construed in the light most favorable to the nonmoving

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party. Cousins v. Lockyer, 568 F.3d 1063, 1067 (9th Cir. 2009). Legal conclusions

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couched as factual allegations are not entitled to the assumption of truth, Ashcroft v.

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Iqbal, 556 U.S. 662, 680 (2009), and therefore are insufficient to defeat a motion to

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dismiss for failure to state a claim, In re Cutera Sec. Litig., 610 F.3d 1103, 1108 (9th Cir.

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2010). To avoid a Rule 12(b)(6) dismissal, the complaint must plead enough facts to

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state a claim to relief that is plausible on its face. Bell Atl. Corp. v. Twombly, 550 U.S.

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544, 570 (2007). This plausibility standard “is not akin to a ‘probability requirement,’

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but it asks for more than a sheer possibility that a defendant has acted unlawfully.” Iqbal,

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556 U.S. at 678 (quoting Twombly, 550 U.S. at 556). “[W]here the well-pleaded facts do

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not permit the court to infer more than the mere possibility of misconduct, the complaint

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has alleged – but it has not ‘show[n]’ – ‘that the pleader is entitled to relief.’” Id. at 679

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(quoting Fed. R. Civ. P. 8(a)(2)).

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“If the running of the statute [of limitations] is apparent on the face of the

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complaint, the defense may be raised by a motion to dismiss.” Jablon v. Dean Witter &

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Co., 614 F.2d 677, 682 (9th Cir. 1980). Even if the relevant dates in the complaint are

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beyond the statutory period, however, the “‘complaint cannot be dismissed unless it

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appears beyond doubt that the plaintiff can prove no set of facts that would establish the

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timeliness of the claim.’” Hernandez v. City of El Monte, 138 F.3d 393, 402 (9th Cir.

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1998) (quoting Supermail Cargo, Inc. v. United States, 68 F.3d 1204, 1206 (9th Cir.

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1995)).

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III.

Analysis.

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Defendant asserts that Plaintiff’s mental anguish claim is subject to the two-year

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statute of limitations found in A.R.S. § 12-542, which provides that actions for “injuries

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done to the person of another” must be commenced and prosecuted within two years after

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the cause of action accrues. Doc. 7 at 1. A cause of action accrues under Arizona law

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“when one party is able to sue another.” Gust, Rosenfeld & Henderson v. Prudential Ins.

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Co. of Am., 898 P.2d 964, 966 (Ariz. 1995). “Under the ‘discovery rule’ a plaintiff’s

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cause of action does not accrue until the plaintiff knows or, in the exercise of reasonable

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diligence, should know the facts underlying the cause.” Id.

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Defendant argues that because Plaintiff admits receiving notice of the foreclosure

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in December 2010, his cause of action accrued at that time. Doc. 7 at 3. Defendant

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contends that “[a]s a result, the statute of limitations on these claims expired after

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December 2012, over seven months prior to the filing of Plaintiff’s complaint[.]” Id at 3-

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4. Plaintiff responds that he is “basing the statute of limitation” on April 26, 2013, when

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“the Arizona Attorney General Office sent [him] a letter that we was receiving payment

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as a result of an agreement between federal banking regulators and Wells Fargo in

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connection with enforcement action related to deficient mortgage servicing and

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foreclosure process (sic throughout).” Doc. 14 at 2. Plaintiff also argues that the Arizona

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Attorney General’s office was conducting an ongoing investigation and that he filed this

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action “within a few days of receiving the letter” from that office. Id. Thus, Plaintiff

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appears to argue that his cause of action for mental anguish did not accrue until he

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received the settlement letter in April 2013.

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It appears that the “mental anguish” alleged in Plaintiff’s complaint was triggered

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by the December 2010 Trustee’s Sale, but Plaintiff also alleges that he received a letter

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regarding “unlawful foreclosure actions” and a check in April 2013. Doc. 1-1, ¶ 13.

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Although Defendant argues that “Plaintiff does not explain how any such letter prevented

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him from filing his lawsuit within the two-year applicable limitations period,” (Doc. 15 at

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2), it is possible that Plaintiff could prove that he was unaware that the foreclosure was

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unlawful until he received the April 2013 letter. Many people likely feel mental anguish

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from a lawful Trustee’s Sale. Plaintiff may not have known that his mental anguish was

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caused by Defendant’s unlawful actions, and that he had a right to sue, until he received

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the notice in 2013. Because Plaintiff may be able to prove a set of facts that will

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establish the timeliness of his claim, Defendant’s motion will be denied.

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IT IS ORDERED that Defendant’s motion to dismiss (Doc. 7) is denied.

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Dated this 18th day of February, 2014.

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