Rinderknecht et al v. Quicken Loans, Inc. et al
Filing
45
ORDER denying 43 Plaintiffs' Motion for Reconsideration/Motion to Vacate 41 Opinion and Order granting 35 Defendants' Motion for Summary Judgment. Signed by Judge John E. Steele on 4/1/2016. (KP)
UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF FLORIDA
FORT MYERS DIVISION
GENE A RINDERKNECHT, As CoTrustees of the Rinderknecht
Living Trust and SANDRA KAY
RINDERKNECHT,
As
CoTrustees of the Rinderknecht
Living Trust,
Plaintiffs,
v.
Case No: 2:15-cv-19-FtM-29MRM
QUICKEN
LOANS,
INC.,
GOVERNMENT NATIONAL MORTGAGE
ASSOCIATION, and MORTGAGE
ELECTRONIC
REGISTRATION
SYSTEMS, INC.,
Defendants.
OPINION AND ORDER
This matter comes before the Court on Plaintiffs' Motion for
Reconsideration/Motion to Vacate Order Granting Summary Judgment
in Favor of Defendants (Doc. #43) filed on January 19, 2016.
Defendants filed a Response in Opposition (Doc. #44) on February
4, 2016.
After due consideration, and for the reasons set forth
below, Plaintiffs’ Motion is denied.
I.
On
April
21,
2015,
Gene
A.
Rinderknecht
and
Sandra
Kay
Rinderknecht (Plaintiffs), proceeding pro se, filed an Amended
Complaint (Doc. #14) against Quicken Loans, Inc. (Quicken), the
Government
National
Mortgage
Association
(Ginnie
Mae),
and
Mortgage
Electronic
(collectively,
Registration
Defendants)
seeking
Systems,
a
Inc.
declaration
that
(MERS)
their
mortgage (the Mortgage) is unenforceable because Defendants have
no lawful interest in the property listed in the Mortgage (the
Property), of which Plaintiffs are the current owners, and to quiet
title to the Property.
In support of their claim that the Mortgage
is void, Plaintiffs advanced the interrelated arguments of (i)
Quicken’s failure to properly record an assignment of the Mortgage
and of a $263,907.000 note (the Note), which Plaintiffs originally
executed with Quicken, and (ii) a subsequent “separation” of the
Note from the Mortgage.
(Doc. #41 p. 2.)
Defendants filed a Motion for Summary Judgment (Doc. #35) on
December 1, 2015, which the Court granted on January 7, 2016.
The
Opinion and Order (Doc. #41) concluded that, even if Quicken had
both failed to properly record an assignment of the Note and
Mortgage and allowed the Note to become “separated” from the
Mortgage, the Mortgage, and its terms, remain enforceable under
Florida law.
(Id. pp. 5-6.)
The Court further held that, because
the Mortgage is still valid, there is no cloud on Defendants’ title
to quiet.
(Id. p. 8.)
Plaintiffs now seek reconsideration of the grant of summary
judgment pursuant to the “catch-all” provision of Rule 60(b)(6),
which allows a party to seek reconsideration of a Court’s order
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for “any . . . reason that justifies relief.” 1
60(b)(6).
Construing
Plaintiffs’
pro
Fed. R. Civ. P.
se
Motion
for
Reconsideration liberally, as the Court must, 2 the Court discerns
four bases for Plaintiffs’ contention that reconsideration is
warranted: 1) summary judgment was premature because “genuine
issues of material fact” remain, upon which Plaintiffs should be
permitted to take discovery; 2) summary judgment should not have
been
granted
defenses;
because
Defendants
have
unresolved
affirmative
3) a grant of summary judgment was improper because
Defendants cannot prove they provided Plaintiffs with a “notice of
default,” as required by the Mortgage; and 4) before granting
summary judgment in Defendants’ favor, the Court was required “to
provide the parties with a declaration of their respective rights
under the contracts,” including a declaration as to “the validity
of the mortgage, the interpretation of the applicable statutes,
and the chain and cloud of title.”
(Doc. #43, ¶¶ 19, 20, 22, 26.)
II.
Reconsideration
of
a
court’s
previous
order
is
an
extraordinary remedy, and reconsideration is a power to be “used
sparingly.”
United States ex rel. Mastej v. Health Mgmt. Assocs.,
1
Naturally, Plaintiffs do not seek reconsideration of the portion
of the Opinion and Order denying Defendants’ Motion for Sanctions
(Doc. #34).
2
United States v. Hung Thien Ly, 646 F.3d 1307, 1316 (11th Cir.
2011).
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Inc., 869 F. Supp. 2d 1336, 1348 (M.D. Fla. 2012).
In particular,
motions filed under Rule 60(b)(6)’s “catch-all” provision “must
demonstrate that the circumstances are sufficiently extraordinary
to warrant relief.”
Galbert v. W. Caribbean Airways, 715 F.3d
1290, 1294 (11th Cir. 2013) (citation omitted).
The movant has
the burden of showing such extraordinary circumstances.
Mastej,
869 F. Supp. 2d at 1348.
A motion for reconsideration does not provide an opportunity
to argue for the first time a new issue that could have been raised
previously, or to argue more vociferously an issue the Court has
previously decided.
first
drafts,
Id.
subject
litigant’s pleasure.”
Court opinions “are not intended as mere
to
revision
and
reconsideration
at
a
Quaker Alloy Casting Co. v. Gulfco Indus.,
Inc., 123 F.R.D. 282, 288 (N.D. Ill. 1988).
When the Court has
carefully
and
considered
the
relevant
issues
rendered
its
decision, “the only reason which should commend reconsideration of
that decision is a change in the factual or legal underpinning
upon which the decision was based.”
1348 (citations omitted).
Mastej, 869 F. Supp. 2d at
Accordingly, a motion to reconsider
should set forth material facts previously unknown to the party
seeking reconsideration or direct the Court’s attention to “law of
a strongly convincing nature to demonstrate to the court the reason
to reverse its prior decision.”
Id. (citations omitted).
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III.
Plaintiffs first contend that summary judgment was premature
because
genuine
issues
of
material
fact
remain,
Plaintiffs should be allowed to take discovery.
upon
which
Plaintiffs do not
state what material facts they expect discovery to reveal or
indicate why these facts constitute “extraordinary circumstances”
warranting reconsideration of the grant of summary judgment.
Pursuant
to
the
Case
Management
Order
(Doc.
#33),
the
discovery deadline in this case was March 1, 2016, approximately
seven weeks after the Court granted Defendants’ Motion for Summary
Judgment.
Although courts generally refrain from granting summary
judgment “until the party opposing the motion has had an adequate
opportunity to conduct discovery,” the Eleventh Circuit Court of
Appeals
granting
has
rejected
adopting
a
of
summary
judgment
motions
occurred or concluded.
“blanket
prohibition
before
on
the
discovery”
has
E.g., Reflectone, Inc. v. Farrand Optical
Co., 862 F.2d 841, 843 (11th Cir. 1989).
Indeed, no federal “rule
requires that a party wait until discovery has taken place” before
moving for summary judgment.
Id.
Instead, where the party
opposing summary judgment believes that additional discovery is
important, it must inform the court of the specific outstanding
discovery needed.
Id. at 844.
The party “may not simply rely on
vague assertions that additional discovery will produce needed,
but unspecified, facts”; rather, the party must “specifically
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demonstrate” how additional discovery will “enable him . . . to
rebut the movant’s showing of the absence of a genuine issue of
fact.”
Id. at 843.
Plaintiffs
did
not
do
this.
Their
Response
opposing
Defendants’ Motion for Summary Judgment did assert, in vague
fashion, that “there are genuine issues of material fact,” which
“Plaintiffs should be allowed to investigate” through discovery,
(Doc. #37, ¶ 29), and claimed further that, “[t]hrough no fault of
the Plaintiffs, discovery has not been conducted or completed.”
(Id. ¶ 27.)
However, Plaintiffs never served Defendants with any
interrogatories
or
discovery
requests,
and
the
Response
in
Opposition did not identify a single fact – material or otherwise
– that Plaintiffs expected to uncover in discovery.
Moreover, in
finding that a grant of summary judgment for Defendants was proper,
this Court determined that Plaintiffs’ claims failed as a matter
of law, that is to say, there was no genuine issue as to any
material fact because no fact would change the legal conclusion
that, even if the Note and Mortgage were “separated,” and even if
an assignment of the Mortgage and Note was not recorded, the
Mortgage remains enforceable under Florida law, and there is no
cloud on Plaintiffs’ title.
(Doc. #41, pp. 7-8.)
The Motion for Reconsideration similarly fails to identify
the specific material facts Plaintiffs anticipate discovering.
More importantly, no amount of discovery will alter the fact that
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Plaintiffs’ “split the note” and “improper assignment” mortgagevoiding theories are invalid under Florida law. 3
granted
summary
judgment
of
Plaintiffs’
That the Court
claims
prior
to
the
discovery deadline does not, therefore, constitute “extraordinary
circumstances” supporting reconsideration of that decision.
Plaintiffs
next
seek
reconsideration
on
the
basis
that
summary judgment should not have been granted before Defendants’
affirmative defenses had been stricken or resolved.
In support of
this contention, Plaintiffs cite Alejandre v. Deutsche Bank Trust
Co., 44 So.3d 1288 (Fla. 4th DCA 2010).
Alejandre observes that,
where a defendant has raised affirmative defenses and there are
“issues of fact raised by the affirmative defenses which have not
been effectively factually challenged and refuted,” a plaintiff’s
motion for summary judgment of the plaintiff’s own claims should
not be granted.
44 So.3d at 1289 (citation omitted).
In other
words, a plaintiff should not be able to win his case on summary
judgment without
the
court
first
defendant’s affirmative defenses.
addressing
the
merits
of
a
Alejandre is inapplicable here,
because it was Defendants who moved for, and were awarded, summary
judgment.
Because
Plaintiffs
cannot
use
the
existence
of
Defendants’ affirmative defenses as a shield to prevent dismissal
3
See (Doc. #41, pp. 6-8); see also infra, pp. 9-12.
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of
Plaintiffs’
own
legally-insufficient
claims
for
relief,
reconsideration is not warranted on this ground.
Plaintiffs’ third argument in support of reconsideration is
that that “numerous” Florida cases have held that summary judgment
is inappropriate where a material issue of fact remains as to
whether a mortgagor was provided with notice in the event of a
default, and Defendants cannot prove they provided Plaintiffs with
the “notice of default” allegedly required by paragraph 13 of the
Mortgage.
(Doc. #43, ¶ 22.)
Initially, neither paragraph 13 nor
any other paragraph of the Mortgage requires Defendants to provide
Plaintiffs
with
notice
in
the
event
of
default;
rather,
the
Mortgage affords Plaintiffs only “a right to be reinstated” after
default, even if foreclosure proceedings have already commenced.
(Doc. #35-1, p. 14.)
Moreover,
a
failure-to-provide-notice
argument
is
appropriately raised in conjunction with a claim for wrongful
foreclosure.
783,
787
See Carter v. HSBC Mortg. Servs., Inc., 622 F. App'x
(11th
Cir.
2015).
Absent
from
Plaintiffs’
Amended
Complaint, Response in Opposition to Defendants’ Summary Judgment
Motion, and Motion for Reconsideration is any contention that
Defendants
commenced
foreclosure
providing a notice of default.
Plaintiffs
payments.
have
ostensibly
proceedings
without
first
In fact, far from being in default,
continued
(See Doc. #44, p. 5.)
making
timely
mortgage
The Court is aware of no legal
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support for the proposition that the failure to provide a requisite
“notice of default” renders a mortgage unenforceable, which is the
declaratory relief Plaintiffs seek in this case.
Accordingly, any
potential failure by Defendants to notify Plaintiffs of a default
is irrelevant to Plaintiffs’ legal claims and is not grounds for
the Court to reverse its grant of summary judgment.
Finally, Plaintiffs assert that, before the Court could grant
summary judgment in Defendants’ favor, it was required “to provide
the parties with a declaration of their respective rights under
the contracts” – presumably the Note and the Mortgage.
#43, ¶ 26.)
(Doc.
What Plaintiffs seemingly fail to understand is that
the Order and Opinion granting Defendants’ Motion for Summary
Judgment and dismissing Plaintiffs’ claims did just that: declared
the parties’ rights.
It just was not the declaration of mortgage
invalidity and clouded title that Plaintiffs sought.
Plaintiffs’ Motion to Reconsider does not cite any case law
undermining the Court’s declaration that the Mortgage is still
valid and there is no cloud on Plaintiffs’ title.
Nor do the
Florida statutory sections cited in the Amended Complaint support
the notion that either the “separation” of a mortgage from a note
or a failure to record an assignment of a note and mortgage void
the mortgage.
As one court has explained:
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Although under Florida law, the assignment of
a security agreement without pledge or
assignment of the underlying note creates no
rights for the assignee or pledgee, this only
means that the holder of the mortgage has no
right to enforce the mortgage, if the holder
does not also hold the promissory note. This
does not mean — as Plaintiffs say - that a
mortgage is invalid, resulting in clear title
to the homeowner, merely as a result of
assigning it without the assignment of the
note to the same entity. Thus, even assuming
only the Mortgage was assigned, without a
corresponding assignment of the Note, this
would only [a]ffect the ability of the holder
of the Mortgage to foreclose but would not
[a]ffect the validity of the Mortgage.
Altier v. Fed. Nat’l Mortg. Ass'n, No. 1:13-CV-164-MW/GRJ, 2013 WL
6388521, at *4 (N.D. Fla. Dec. 6, 2013) (emphases added) (citations
omitted); see also Mahan v. Suntrust Mortg., Inc., No. 5:14-CV109-OC-10PRL, 2015 WL 3605105, at *5 (M.D. Fla. June 8, 2015)
(rejecting claim that Fla. Stat. §§ 673.2031 and 677.501 “provide[]
that a mortgage can be declared null and void based on a failure
to record an assignment or transfer”).
As
discussed
in
the
Order
and
Opinion
granting
summary
judgment, under Florida law, “[w]hen a note secured by a mortgage
is assigned, the mortgage follows the note into the hands of the
assignee.”
Margiewicz v. Terco Props. of Miami Beach, Inc., 441
So. 2d 1124, 1125 (Fla. 3d DCA 1983); see also Taylor v. Bayview
Loan Servicing, LLC, 74 So. 3d 1115, 1117-18 (Fla. 2d DCA 2011)
(holding
that
assignment
of
note
presumptively
also
assigns
mortgage, barring evidence that parties agreed to the contrary).
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Plaintiffs’ “split the note” theory is, therefore, not legally
supported.
Case law similarly forecloses Plaintiffs’ argument
that, under Florida law, “a failure to record any subsequent
assignment afford[s] the mortgagor . . . an opportunity to avoid
the mortgage.” 4
In re Halabi, 184 F.3d 1335, 1338 (11th Cir. 1999)
(citation omitted).
In any case, “Plaintiffs do not have standing
to raise a challenge to the validity of the assignment[,] because
Plaintiffs were not parties to those transfers.”
Howell v. PHH
Mortg. Corp., No. 6:15-CV-883-ORL-TBS, 2015 WL 5829673, at *3 (M.D.
Fla. Oct. 1, 2015) (collecting cases), reconsideration denied, No.
6:15-CV-883-ORL-TBS, 2015 WL 6750809 (M.D. Fla. Nov. 5, 2015).
In sum, Plaintiffs’ theories for why the Mortgage is void are
– as before - legally unsustainable, and reconsideration of this
Court’s declaration that there is no cloud on Plaintiffs’ title to
quiet is not warranted.
See Barrows v. Bank of Am., NA, No. 8:14-
CV-2121-T-33, 2014 WL 7337429, at *3 (M.D. Fla. Dec. 23, 2014)
(observing that where plaintiffs “have failed to state a cognizable
4
Indeed, Fla. Stat. § 695.01 (“Conveyances and liens to be
recorded”) “applies only to conveyances of real property,” and a
mortgage assignment is “not a conveyance of real property.” Fid.
Land Trust Co., LLC v. Mortg. Elec. Registration Sys., Inc., No.
6:12-CV-1367-ORL-37, 2012 WL 6720994, at *4 (M.D. Fla. Dec. 4,
2012), report and recommendation adopted, No. 6:12-CV-1367-ORL37, 2012 WL 6720992 (M.D. Fla. Dec. 27, 2012); see also Garrett v.
Fernauld, 57 So. 671, 672 (Fla. 1912) (finding Florida recording
statute inapplicable to mortgage assignments because “[a]n
assignment of a mortgage lien is not ‘a conveyance’ or a ‘transfer’
of ‘any interest’ in land covered by the mortgage”).
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cause of action for quiet title . . . [they also] have failed to
state a cause of action for declaratory judgment.”); see also Lane
v. Guar. Bank, 552 F. App'x 934, 936 (11th Cir. 2014) (“A claim
for quiet title in Florida must . . . [show] that a cloud exists,
before relief can be given against it.” (quoting Stark v. Frayer,
67 So.2d 237, 239 (Fla. 1953))).
To conclude, none of the arguments raised in Plaintiffs’
Motion for Reconsideration reveal “extraordinary circumstances”
warranting reconsideration of this Court’s grant of Defendants’
Motion for Summary Judgment.
Plaintiffs’ Motion is, therefore,
denied.
Accordingly, it is hereby
ORDERED:
Plaintiffs' Motion for Reconsideration/Motion to Vacate Order
Granting Summary Judgment in Favor of Defendants (Doc. #43) is
DENIED.
DONE and ORDERED at Fort Myers, Florida, this 1st day of
April, 2016.
Copies:
Parties of Record
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