Moreno v. U.S. Bank, N.A. et al

Filing 31

ORDER GRANTING 15 Defendant's Motion to Dismiss. Case is Dismissed. By Judge Christine M. Arguello on 8/10/2018. (swest)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLORADO
Civil Action No. 17-cv-02850-CMA-MJW
LOUISE MORENO,
Plaintiff,
v.
U.S. BANK N.A.,
THE PUBLIC TRUSTEE’S OFFICE OF DENVER COUNTY, COLORADO, and
ANY AND ALL OTHER PARTIES WHO MAY HAVE AN INTEREST IN THE SUBJECT
PROPERTY,
Defendants.
ORDER GRANTING DEFENDANT’S MOTION TO DISMISS
This case is before the Court on Defendant U.S. Bank, N.A.’s (“Defendant Bank”)
Motion to Dismiss. (Doc. # 15.) Plaintiff filed a response (Doc. # 21) and Defendant
Bank filed a reply (Doc. # 29). The Court has carefully considered the motion, the
response, the reply, and the various exhibits submitted by the parties. The Court has
taken judicial notice of the Court’s file and has considered the applicable Federal Rules
of Civil Procedure and case law. The Court now being fully informed and having
jurisdiction pursuant to 28 U.S.C. § 1332 grants the motion to dismiss for the following
reasons.
I.

BACKGROUND

Plaintiff commenced this case in Denver County District Court, and Defendant
Bank then removed the action on November 28, 2017. (Doc. # 1.) In her complaint,
Plaintiff brings two claims relating to real property known as 1590 Little Raven Street,
Unit 306, Denver, CO 80202 (the “Subject Property”). First, she brings a claim under

Colorado Rule of Civil Procedure 105, asking the Court to find that Defendant Bank is
time barred from foreclosing on the Subject Property. Second, she seeks a declaratory
judgment that her obligation to satisfy the Promissory Note (“Note”) relating to the
Subject Property is also time barred and that, as a result, the Deed of Trust “is
extinguished, unenforceable and released” as to the Subject Property. (Doc. # 6 at 5.)
Similarly, Plaintiff asks the Court to find that “the underlying debt evidenced by the
Promissory Note allegedly held by [Defendant Bank] and signed by [Plaintiff] is time
barred and uncollectible.” (Id.)
Plaintiff’s claims are premised on the argument that the six-year limitations period
set forth in Colorado Revised Statute § 13-80-103.5 bars the Defendant Bank’s most
recent foreclosure action initiated on March 23, 2017, because it occurred nearly seven
years after the first foreclosure action, which commenced on January 15, 2010.
In the instant motion, Defendant Bank argues that “[t]he statute of limitations
begins running on acceleration, not default” and that the prior withdrawals of earlier
foreclosures “restarted any running limitations clock.” (Doc. # 15 at 2.) Defendant further
contends that Plaintiff is judicially estopped from challenging the Note and Deed of Trust
held because Plaintiff recognized them as outstanding debts in her 2014 and 2017
bankruptcy plans. (Id. at 9–10.)
II.

STANDARD OF REVIEW

The purpose of a motion to dismiss for failure to state a claim under Rule
12(b)(6) is to test “the sufficiency of the allegations within the four corners of the
complaint.” Mobley v. McCormick, 40 F.3d 337, 340 (10th Cir. 1994). A complaint will
survive such a motion only if it contains “enough facts to state a claim to relief that is
plausible on its face.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007). For a
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motion to dismiss, “[t]he question is whether, if the allegations are true, it is plausible
and not merely possible that the plaintiff is entitled to relief under the relevant law.”
Christy Sports, LLC v. Deer Valley Resort Co., 555 F.3d 1188, 1192 (10th Cir. 2009).
“The plausibility standard is not akin to a probability requirement, but it asks for more
than a sheer possibility that a defendant has acted unlawfully.” Ashcroft v. Iqbal, 556
U.S. 662, 678 (2009) (quotation marks and citation omitted).
In reviewing a Rule 12(b)(6) motion, a court “must accept all the well-pleaded
allegations of the complaint as true and must construe them in the light most favorable
to the plaintiff.” Williams v. Meese, 926 F.2d 994, 997 (10th Cir. 1991). Nevertheless, a
complaint does not “suffice if it tenders ‘naked assertion[s]’ devoid of ‘further factual
enhancement.’” Iqbal, 556 U.S. at 678 (quoting Twombly, 550 U.S. at 557). “The court’s
function on a Rule 12(b)(6) motion is not to weigh potential evidence that the parties
might present at trial, but to assess whether the plaintiff’s complaint alone is legally
sufficient to state a claim for which relief may be granted.” Miller v. Glanz, 948 F.2d
1562, 1565 (10th Cir. 1991).
Normally, when considering a motion to dismiss, a court must disregard facts
supported by documents other than the complaint unless the court first converts the
motion to dismiss into a motion for summary judgment. Jackson v. Integra Inc., 952
F.2d 1260, 1261 (10th Cir. 1991). However, a court may consider outside documents
that are both central to Plaintiff’s claims and to which Plaintiff refers in her complaint.
GFF Corp. v. Associated Wholesale Grocers, 130 F.3d 1381, 1384 (10th Cir. 1997). A
court may also consider documents subject to judicial notice, including court documents
and matters of public record. Tal v. Hogan, 453 F.3d 1244, 1265 n.24 (10th Cir. 2006).
In this case, the Deed of Trust and the Assignment to Defendant Bank were both
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attached to the complaint, and the Court may therefore consider them. In addition,
Defendant Bank has submitted documents filed in Plaintiff’s 2014 and 2017 bankruptcy
proceedings. Based on the above-mentioned principles, the Court properly considers
these documents without converting the instant motion to a motion for summary
judgment.
III.

ANALYSIS

The Court begins with Defendant Bank’s judicial estoppel argument. As an initial
matter, Defendant Bank clearly asserted this argument in the motion (Doc. # 15 at 9-10)
and Plaintiff did not address it in her response. As this Court has previously held, a
failure to respond to an argument is a confession. See, e.g. Rothe v. Sloan, 2015 WL
3457894, at *2 (D. Colo. May 29, 2015). However, even if Plaintiff did respond to the
argument, she could not defeat it. Judge Jackson recently faced the same argument
and found that “the six-year statute of limitations under Colorado law for recovering a
debt ha[d] not expired” when “plaintiffs voluntarily re-affirmed that they would repay their
debt to defendant” by affirmatively stating the obligation and their intent to repay the
debt in a bankruptcy petition. Christenson v. CitiMortgage, Inc., 255 F.Supp.3d 1099,
1108-09 (D. Colo. 2017). As Judge Jackson explained:
Such an affirmation, as well as plaintiffs’ subsequent
payments to defendant during bankruptcy, . . . , undoubtedly
“renewed” the statute of limitations on plaintiffs’ debt, see
Hutchins v. La Plata Mountain Res., Inc., 373 P.3d 582, 585
(Colo. 2016) (“That an implicit promise to pay, either in the
form of a partial payment . . . or an acknowledgment meeting
these conditions . . . will extend the statute of limitations has
remained, largely unquestioned, the law of this jurisdiction.”)
(citations omitted); Drake v. Tyner, 914 P.2d 519, 523 (Colo.
App. 1996) (statute of limitations period begins anew with
each part payment); see also Koyle v. Sand Canyon Corp.,
2:15-CV-00239, 2016 WL 917927, at *4 (D. Utah Mar. 8,
2016), aff’d, 16-4035, 683 F. App’x 715, 2017 WL 1192186
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(10th Cir. Mar. 31, 2017) (Here, “[the borrower]
acknowledged the debt during his second Chapter 13
bankruptcy resulting in a renewal of [Utah’s] six year statute
of limitations period.”).
Id. at 1109.
In this case, Plaintiff voluntarily filed her second bankruptcy under Chapter 13 on
June 21, 2017. (Doc. # 15-15.) In that document, Plaintiff included the same language
on which Judge Jackson relied in Christenson: “[d]efaults shall be cured and regular
payments shall be made” with regard to the mortgage on the Subject Property. (Doc.
# 15-17 at 5–6.)
As Defendant Bank argues, this type of behaviour is what judicial estoppel is
designed to preclude. “The doctrine of judicial estoppel is based upon protecting the
integrity of the judicial system by ‘prohibiting parties from deliberately changing
positions according to the exigencies of the moment.’” Bradford v. Wiggins, 516 F.3d
1189, 1194 (10th Cir. 2008) (quoting New Hampshire v. Maine, 532 U.S. 742, 749-50
(2001)); see also In re Cassidy, 892 F.2d 637, 641 (7th Cir. 1990) (“Judicial estoppel is
a doctrine intended to prevent the perversion of the judicial process”). The Court
considers whether “1) a party’s later position is clearly inconsistent with its earlier
position; 2) a party has persuaded a court to accept that party’s earlier position, so that
judicial acceptance of an inconsistent position in a later proceeding would create the
perception that either the first or second court was misled; and 3) the party seeking to
assert the inconsistent position would derive an unfair advantage if not estopped.”
Mathews v. Denver Newspaper Agency LLP, 649 F.3d 1199, 1209 (10th Cir. 2011)
(quoting Bradford, 516 F.3d at 1194 (internal quotations omitted)).

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In this case, it is clear that Plaintiff recognized in her 2017 bankruptcy plan (Doc.
# 15-17), which was confirmed by Judge McNamara on September 29, 2017 (Doc. #
15-18 at 3), that she owed money on the outstanding mortgage on the Subject Property
and that she intended to pay that debt (Doc. # 15-17 at 5–6, 10). Plaintiff was then
granted relief under Chapter 13 by Judge McNamara based on the disclosures and
admissions in the Chapter 13 Plan. (Doc. # 15-18.) If this Court now declares that
mortgage debt to be extinguished, Plaintiff would certainly derive an unfair advantage.
Notably, on November 16, 2017, Judge McNamara granted Defendant Bank relief from
the automatic stay with regards to the Subject Property. (Doc. # 15-19.) The November
16, 2017 order specifically allowed Defendant Bank to “foreclose on and/or take
possession and control of” the Subject Property. (Id. at 2.)
Based on all of this evidence, the Court finds that the judicial estoppel factors
have been satisfied, and Plaintiff is accordingly estopped from arguing that the Note and
Deed of Trust are no longer enforceable. To conclude otherwise would improperly
promote the perversion of the judicial process. Because Plaintiff’s claims rest entirely on
her argument that the Note and Deed of Trust are unenforceable and this Court has
concluded otherwise, Plaintiff cannot prevail on those claims and dismissal of the
complaint is accordingly warranted.
IV.

CONCLUSION

For the foregoing reasons, the Court GRANTS Defendant Bank’s Motion to
Dismiss (Doc. # 15) and DISMISSES Plaintiff’s complaint WITH PREJUDICE. Because
there are no claims in the complaint that survive this dismissal and no counterclaims
have been lodged, the Court ORDERS that this action is DISMISSED.

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DATED: August 10, 2018

BY THE COURT:

CHRISTINE M. ARGUELLO
United States District Judge

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