Deutsche Bank National Trust Company et al v. Bishop
Filing
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MEMORANDUM. Signed by Judge Gregory M. Sleet on 9/30/2015. (mdb)
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF DELAWARE
DEUTSCHE BANK NATIONAL TRUST
COMPANY, as Trustee for Securitized Asset
Backed Receivables LLC Trust 2007-HEl,
Mortgage Pass-Through Certificates, Series
2007-HEl,
C.A. No. 1:13-CV-01645 (GMS)
Plaintiff,
v.
RONALD BISHOP,
Defendant.
MEMORANDUM
I. INTRODUCTION
On August 29, 2013, Deutsche Bank National Trust Company ("Deutsche Bank"), as
Trustee for Securitized Asset Backed Receivables LLC Trust 2007-HEl, Mortgage PassThrough Certificates, Series 2007-HEl, filed ascirefasias surmortgage action in the Superior
Court of the State of Delaware in and for New Castle County. (D .I. 16 at ifl). 1n that state court
complaint, Deutsche Bank alleged that Mr. Ronald Bishop ("Bishop"): (1) was the mortgagor for
the Mortgage at issue; (2) had failed to pay the monthly installments due under the Mortgage; (3)
had further failed to pay after Deutsche Bank's demand and acceleration; and (4) demanded
judgment against the Plaintiff for Mortgage. 1 (D.I. 16 at if3-4). On October 3, 2013, under 28
U.S.C. § 1441(a) and (b), Bishop removed the matter to this Court. (D.I. 1).
Presently before the Court is Deutsche Bank's motion for summary judgment (D.I. 16)
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The original state court complaint demanded $130,977.17 (D.I. 16 at if4) and as of March 27, 2013, the total
amount demanded by Plaintiff was $146,020.89 plus reasonable attorney's fees and costs. (D.I. 16 at n.l).
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and Bishop's motion requesting further discovery (D.I. 17). For the reasons discussed below, the
Court will grant Plaintiffs motion for summary judgment and deny defendant's request to
continue discovery.
II. BACKGROUND
Deutsche Bank's original complaint, filed in the Superior Court of the State of Delaware
in and for New Castle County, had attached the complete statutorily required exhibits to support
their case: (1) a certified copy of the mortgage; (2) disclosures required under 15 U.S. C. §§ 16011692; and (3) an amounts due affidavit required by 10 Del. C. § 5062D(b)(2). (D.I. 16 at 't[2, 't[5).
Shortly thereafter on December 9, 2014, Deutsche Bank timely filed a loss mitigation affidavit as
required by 10 Del. C. § 5062A. (D.I. 6 at if5). On December 20, 2013, Defendant filed his
answer and admitted his failure to pay according to the terms of the mortgage agreement. (D.I. 6
at 't[6).
Discovery proceeded according to the Scheduling Order (D.I. 7) and was completed on
October 8, 2014. (D.I. 13). Discovery did not yield additional material evidence.
III. GOVERNING LAW
When a case is removed from state court to a federal court based on diversity jurisdiction,
the federal court applies state substantive law using the federal procedural rules. New Castle
County, DE v. Natl. Union Fire Ins. Co. ofPittsburgh, PA, 243 F.3d 744, 749 (3d Cir. 2001)
(citing Erie R.R. Co. v. Tompkins, 304 U.S. 64, 78 (1938)). When considering state law, the
decisions of the state's highest court are authoritative. Connecticut Mut. Life Ins. Co. v. Wyman,
718 F.2d 63, 65 (3d Cir. 1983).
The scirefasias sur mortgage action is codified in 10 Del. C. §§5061-67. This in rem
action is a legal remedy to recover real property following the breach of a mortgage agreement
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by nonpayment or nonperformance. 10 Del. C. §5061(a). The action is an expedited means to
demand that the mortgagor "appear and show cause why the mortgaged premises should not be
seized and taken in execution for payment of the mortgage money and damages." Gordy v.
Preform Bldg. Components, Inc., 310 A.2d 893, 896 (Del. Super. 1973). For ascirefasias sur
mortgage claim to succeed, the Plaintiff must only show that he is a valid holder of the mortgage
and that the Defendant has failed to fulfill his obligation under the mortgage to the Plaintiff. 10
Del.C. § 5061.
Only two legal defenses, payment or satisfaction, and the equitable claim of a plea in
avoidance, are recognized defenses against a scire fasias action. Gordy, 3 l 0 A.2d at 895-96
(discussing "plea in avoidance of the deed" as a vestige of the common law plea of confession
and avoidance that captures equitable remedies notwithstanding legal liability); Brooks v. BAC
Home Loans Servicing, LP, 53 A.3d 301 (Table) (Del. 2012); Wells Fargo Bank, NA. v.
Williford, 2011 WL 5822630, at *3 (Del. Super. Nov. 17, 2011) (noting that answers in scire
fasias actions are limited and counterclaims may not be asserted); First Fed. Sav. & Loan Assn.
ofNorwalkv. Falls, 1986 WL 9916, at *1 (Del. Super. Sept. 9, 1986) affd sub nom. Christiana
Falls, L.P. v. First Fed. Sav. & Loan Assn. ofNorwalk, 520 A.2d 669 (Del. 1986) (recognizing
that Gordy restricts pleadings, 310 A.2d 893). Claims of fraud or other impropriety as a defense
to the scire fasias action are generally barred unless the claims directly relate to the original
mortgage transaction and are factually supported. Lasalle Nat. Bank v. Ingram, 2005 WL
1284049, at *2 (Del. Super. May 19, 2005). This requirement preserves the in rem nature of the
scire fasias action and avoids inserting in personam matters into the property focused action. Id.
at *3. While these in personam counterclaims may not be joined with the in rem action, they
may be separately pursued subject to the statute oflimitations and other provisions of Delaware
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law. Id. at *2-*3. In summary, well-settled Delaware substantive law establishes a cabined
foreclosure mechanism that specifically limits both counterclaims that may be joined and
defenses that may be raised.
IV. STANDARD OF REVIEW
Summary judgment is appropriate "if the pleadings, depositions, answers to
interrogatories, and admissions on file, together with the affidavits, if any, show that there is no
genuine issue as to any material fact and that the moving party is entitled to a judgment as a
matter oflaw." Fed. R. Civ. P. 56(c); see also Celotex Corp. v. Catrett, 477 U.S. 317, 323
(1986) (noting that a "complete failure of proof concerning an essential element of the
nonmoving party's case necessarily renders all other facts immaterial"). The moving party bears
the burden of proving that no genuine issue of material fact exists. Ma_tsushita Elec. Indus. Co.,
Ltd. v. Zenith Radio Corp., 475 U.S. 574, 585 n.10 (1986). A fact is material ifit "could affect
the outcome" of the proceeding. Lamont v. New Jersey, 637 F.3d 177, 181 (3d Cir. 2011).
There is a genuine issue "if the evidence is sufficient to permit a reasonable jury to return a
verdict for the non-moving party." Id. Genuine issues are those issues that require a finder of
fact to resolve the parties' differing versions of the truth. In re Lemington Home for Aged, 659
F.3d 282, 290 (3d Cir. 2011), as amended (Oct. 20, 2011). When determining whether a genuine
issue of material facts exists, the district court must view the evidence in the light most favorable
to the nonmoving party and draw inferences in that party's favor. Wishkin v. Potter, 476 F.3d
180, 184 (3d Cir. 2007). If the moving party is able to demonstrate an absence of disputed
material facts, the nonmoving party must then "come forward with 'specific facts showing that
there is a genuine issue for trial."' Matsushita, 475 U.S. at 587 (citing Fed. R. Civ. P. 56(e)).
The mere existence of some evidence in support of the nonmoving party will not be
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sufficient for denial of a summary judgment motion. Anderson v. Liberty Lobby, Inc., 477 U.S.
242, 249 (1986). Rather, the nonmoving party must present enough evidence to enable a jury to
reasonably find for it on that issue. Id. The party opposing summary judgment must present
more than just "mere allegations, general denials, or ... vague statements" to show the existence
of a genuine issue. Quiroga v. Hasbro, Inc., 934 F.2d 497, 500 (3d Cir. 1991). As such, a
nonmoving party must support their assertion that a material fact is in dispute by: "(A) citing to
particular parts of materials in the record, including depositions, documents, electronically stored
information, affidavits or declarations, stipulations (including those made for purposes of the
motion only), admissions, interrogatory answers, or other materials"; or "(B) showing that the
materials cited do not establish the absence or presence of a genuine dispute, or that an adverse
party cannot produce admissible evidence ~o support the fact." Fed. R. Civ. P. 56(c)(l). The
moving party is entitled to judgment as a matter of law if the nonmoving party fails to make a
sufficient showing on an essential element of its case for which it has the burden of proof.
Celotex, 477 U.S. at 322.
V. DISCUSSION
Deutsche Banlc argues that they have made out a complete case for scire fasias sur
mortgage with no material facts in question. (D.I. 16). Bishop asserts numerous state law
counterclaims and three federal counterclaims against Deutsche Bank. (D.I. 6). The Court
examines each of the parties' arguments below, in tum.
A. Deutsche Bank's in rem Mortgage Action
Delaware law affords mortgagees a streamlined foreclosure process requiring specific
proof and allowing limited replies. Gordy, 310 A.2d at 895-96. With the original state court
complaint, Deutsche Bank clearly met their initial burden of production: Deutsche Bank
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established that they were an assignee of the mortgage and that Bishop had failed to perform
under its terms. (D.I. 16 at if2-if3). The burden then shifted to Bishop to demonstrate why the
property should not be seized in satisfaction. Gordy, 310 A.2d at 896. In the Answer, Bishop
admitted his failure to pay. (D.I. 6 at if6). Bishop raised none of the affirmative defenses
recognized by Delaware law. (D.I 6) and (D.I. 17).
Applying the standard of review discussed above, if, after adequate time for discovery,
the nonmoving party has failed to come forward with a sufficient showing on an element of its
case, the moving party is entitled to judgment as a matter oflaw. Celotex, 477 U.S. at 322-23.
Deutsche Bank is an assignee of the mortgage; Bishop admitted he failed to fulfill his
responsibilities under the Mortgage agreement. These two facts are the heart of the scire fasias
action. 10 De{ C. § 5061. Both facts are undisputed in the record. Accordingly, no genuine issue
of material fact exists to preclude the entry of summary judgment in favor of Deutsche Bank for
the mortgage action.
B. Bishop's Counterclaims
In the Answer, Bishop asserted seventeen counterclaims. (D.I. 6 at 2-3). Bishop raised
none of the affirmative defenses recognized under Delaware law. (D.I. 6). Under Delaware
substantive law, counterclaims not directly related to the original mortgage transaction may not
be joined with thescirefasias action. See, e.g. First Fed. Sav. &LoanAssn., 1986 WL 9916, at
* 1. Each state law claim is outside the scope of defenses and counterclaims permitted by
Delaware law in a scire fasias sur mortgage action. See e.g., Wells Fargo Bank, NA., 2011 WL
5822630, at *3. Because joinder of these state law counterclaims with the scirefasias action is
barred under Delaware law, none are properly before the court. Accordingly, the court will not
consider any of these state law claims on the merits.
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Bishop also raised three counterclaims alleging that the Deutsche Bank violated federal
law. (D.I. 6 at 3). Bishop asserts that Deutsche Bank violated the False Claim Act, 31 U.S.C. §
3729 et seq., the Truth in Lending Act, 15 U.S.C. § 1601 et seq., and the Real Estate Settlement
Procedures Act, 12 U.S.C.A. § 2601 et seq.. (D.I. 6 at 3). Bishop re-asserted each of these
counterclaims in his Reply to Deutsche Bank's motion for summary judgement. (D.I. 17 at 3-4).
Because the Defendant is proceeding prose, the court construes the pleadings liberally.
Erickson v. Pardus, 551 U.S. 89, 94 (2007). Despite this less stringent standard, the assertions
that Deutsche Bank violated the False Claims Act, The Truth in Lending Act, and the Real Estate
Settlement Procedures Act are all purely conclusory statements lacking even the barest support.
See Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). Each assertion is enumerated in the Answer as
a plain, conclusory statement. (D.I. 6 at 3). Neither context for these assertions nor facts
surrounding them were plead. Id. In Bishop's Reply to Deutsche Bank's Motion for Summary
Judgment, the same plain, conclusory assertions were made, again with neither context nor
adjacent facts. (D.I. 17 at 3-4). "[N]aked assertion[s] devoid of further factual enhancement" are
insufficient to meet the minimum pleading requirements. Id. (citing Bell Atl. Corp. v. Twombly,
550 U.S. 544, 557 (2007)).
Because Bishop is proceeding prose, the court allowed discovery to provide an
opportunity for Bishop to develop the factual record (D.I. 7). Bishop's motion to extend
discovery was also granted. (D.I. 13). Discovery did not yield evidence to support these three
conclusory allegations. (D.I. 11) and (D.I. 12).
If, after adequate time for discovery, the nonmoving party has failed to come forward
with a sufficient showing on an element of its case, the moving party is entitled to judgment as a
matter oflaw. Celotex, 477 U.S. at 322-23. Bishop has failed to establish any element of these
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three claims; consequently, they are dismissed with prejudice.
VI. CONCLUSION
Deutsche Bank has met the burden of production in the in rem foreclosure action; Bishop
admitted his failure to perform under the mortgage agreement. As discussed above, there are no
material facts in question precluding summary judgment in favor of Deutsche Bank. Because
Delaware state law preserves the in rem essence of foreclosure actions by baring joinder of in
personam claims, Bishop's state law counterclaims are not properly before the court and are
dismissed without consideration on the merits. After an opportunity to pursue discovery, Bishop
elicited no material evidence to support his three federal counterclaims; accordingly those
counterclaims are dismissed.
Dated: September j_Q_, 2015
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