Haynes v. JPMorgan Chase Bank NA et al
Filing
60
ORDER denying 51 Motion to Strike; granting 53 Motion for Summary Judgment; denying 59 Motion for Leave to File. Ordered by Judge Clay D. Land on 06/29/2011. (CGC) ***
IN THE UNITED STATES DISTRICT COURT
FOR THE MIDDLE DISTRICT OF GEORGIA
ATHENS DIVISION
DARRYL S. HAYNES,
*
Plaintiff,
*
vs.
*
JPMORGAN CHASE BANK, N.A.,
et al.,
CASE NO. 3:10-CV-11 (CDL)
*
*
Defendants.
*
O R D E R
Plaintiff Darryl S. Haynes (“Haynes”) borrowed more than
$400,000 from United Bank in 2006.
loan,
Haynes
signed
a
Note
and
In conjunction with the
Security
Deed.
Defendant
JPMorgan Chase Bank, N.A. (“Chase”) asserts that the Note and
Security Deed were later transferred to it.
it
has
the
right
to
foreclose
on
Chase contends that
Haynes‟s
property
because
Haynes defaulted on his obligations under the Note and Security
Deed.
and
Haynes filed the present action “for emergency injunctive
declaratory
relief
Compl., ECF No. 1-4.
to
stay
foreclosure.”
See
generally
Haynes does not dispute that he owes more
than $400,000 on his loan, and he does not dispute that he is in
default
under the Note and Security Deed.
Haynes contends,
however, that Chase has no rights in the Note and Security Deed
and thus cannot foreclose on his property.
Chase asserts that
there is no genuine fact dispute that Chase does hold the Note
and Security
Deed and is therefore entitled to foreclose on
Haynes‟s property.
For the reasons set forth below, the Court
agrees with Chase, and Chase‟s Motion for Summary Judgment (ECF
No. 53) is granted.
is denied.
Plaintiff‟s Motion to Strike (ECF No. 51)
Plaintiff‟s Motion for Leave to File Sur-reply (ECF
No. 59) is denied.
HAYNES‟S PENDING MOTIONS
As a preliminary matter, the Court addresses Haynes‟s two
pending motions: his Motion to Strike and his Motion for Leave
to File Sur-reply.
I.
As discussed below, both motions are denied.
Haynes’s Motion to Strike
Haynes
Objections
filed
to
a
“Motion
Plaintiff‟s
to
Strike”
Second
Documents and Things (ECF No. 51).
Chase‟s
Request
for
Response
and
Production
of
Haynes‟s chief complaint
appears to be that Chase‟s responses were untimely; he contends
that
Chase‟s
counsel
“waited
Responses and Objections.”
51.
Chase‟s
response
was
33
days
before
filing
[the]
Pl.‟s Mot. to Strike 1 ¶ 2, ECF No.
not
untimely.
Haynes
served
his
request for production on Chase via U.S. Mail on December 6,
2010.
Pl.‟s 2d Req. for Produc. of Docs., ECF No. 41.
response was due thirty-three days later.
Chase‟s
See Fed. R. Civ. P.
34(b)(2)(A) (“The party to whom the request is directed must
respond in writing within 30 days after being served.”); Fed. R.
Civ. P. 6(d) (providing that when service is made by mail and
2
several
other
methods
under
Federal
Rule
of
Civil
Procedure
5(b)(2), “3 days are added after the period would otherwise
expire under Rule 6(a)”).
fell
on
a
Saturday,
Because that date, January 8, 2011,
Chase‟s
response
was
business day: Monday, January 10, 2011.
due
on
the
next
See Fed. R. Civ. P.
6(a)(1)(C) (“[I]f the last day [of the period] is a Saturday,
Sunday, or legal holiday, the period continues to run until the
end of the next day that is not a Saturday, Sunday, or legal
holiday.”).
Chase timely served its response on Haynes via U.S.
Mail on January 7, 2011.
Pl.‟s Mot. to Strike Ex. A, Def.‟s
Resps. & Objections to Pl.‟s 2d Req. for Produc. of Docs., ECF
No. 51-1.
For these reasons, Haynes‟s “Motion to Strike” is
baseless, and the Court denies it.
II.
Haynes’s Motion to File Sur-Reply Brief
Haynes requests permission to file a sur-reply brief in
opposition to summary judgment (ECF No. 59).
denied.
His request is
Haynes has already briefed nearly all of the issues on
which he seeks to include in a sur-reply, and the Court finds
that additional briefing is not necessary on any of the issues
Haynes raised in his motion for permission to file a sur-reply.
Haynes also seeks to offer “additional proof” in opposition to
summary judgment.
reply brief.
could
not
Chase did not rely on any new evidence in its
Haynes did not explain why his “additional proof”
have
been
offered
when
3
he
filed
his
original
opposition to summary judgment, even though “now known issues”
came to light during the discovery extension granted by the
Court—before Haynes‟s summary judgment response deadline.
Given
that the “additional proof” relates to issues and evidence that
were presented in Chase‟s original summary judgment motion and
statement
of
undisputed
material
facts,
the
Court
denies
Plaintiff‟s Motion for Leave to File Sur-reply (ECF No. 59).
CHASE‟S SUMMARY JUDGMENT MOTION
The Court now turns to Chase‟s summary judgment motion.
For the reasons set forth below, the motion is granted.
I.
Summary Judgment Standard
Summary judgment may be granted only “if the movant shows
that there is no genuine dispute as to any material fact and the
movant is entitled to judgment as a matter of law.”
Civ. P.
56(a).
Fed. R.
In determining whether a genuine dispute of
material fact exists to defeat a motion for summary judgment,
the evidence is viewed in the light most favorable to the party
opposing summary judgment, drawing all justifiable inferences in
the opposing party=s favor.
U.S. 242, 255 (1986).
Anderson v. Liberty Lobby, Inc., 477
A fact is material if it is relevant or
necessary to the outcome of the suit.
Id. at 248.
A factual
dispute is genuine if the evidence would allow a reasonable jury
to return a verdict for the nonmoving party.
4
Id.
II.
Factual Background
Viewed in the light most favorable to Haynes, the record
reveals the following:
In 2001, Haynes financed the purchase of a 51-acre tract of
land located at 1380 Indian Creek Trail, Madison, Georgia 30650
(“Property”) with a loan secured by a first priority Security
Deed.
Pl.‟s Dep. 16:3-18:3, ECF No. 34; accord Pl.‟s Am. Opp‟n
to Def.‟s Statement of Undisputed Material Facts ¶ 1, ECF No. 57
[hereinafter Pl.‟s SMF Opp‟n] (acknowledging 2001 “land note”).
Haynes also obtained a construction loan so he could construct a
house
on
the
property;
priority Security Deed.
that
loan
was
secured
by
a
second
Pl.‟s Dep. 18:4-19:6; accord Pl.‟s SMF
Opp‟n ¶ 1 (acknowledging construction loan).
On
March
17,
2006,
pursuant
consolidated the two loans.
to
refinancing,
Haynes
Haynes signed a loan Note in the
principal amount of $417,000 (“Note”), with United Bank as the
lender.
Pl.‟s Dep. Ex. 1, Note; accord Compl. ¶ 5 (“On or about
March 17, 2006, Plaintiff executed a Note and Security Deed in
favor of United Bank in connection with the refinance of the
Property.”); see also Pl.‟s SMF Opp‟n Attach. 13, Will Aff. ¶¶
14, 18-19, ECF No. 56-13 (finding that signatures, including
Plaintiff‟s,
(„wet‟)”
on
Note
and
approximately
$70,000
in
Deed
At
signatures).
Security
closing,
the
cash,
5
and
the
were
“original
Haynes
prior
loans
inked
received
on
the
Property
were
contends
paid off.
that
these
Pl.‟s Dep. 25:25-26:17.
“allegation[s]
cannot
be
Plaintiff
adequately
ascertained,” Pl.‟s SMF Opp‟n ¶ 2, but he points to no evidence
that (1) he did not sign the Note on March 17, 2006, (2) he did
not receive cash at closing, or (3) the original loans were not
paid off.
Haynes also signed a Security Deed conveying the Property
to United Bank as the grantee (“Security Deed”).
27:8-18; Pl.‟s Dep. Ex. 2, Security Deed.
Pl.‟s Dep.
The Security Deed was
recorded in the real estate records of Morgan County, Georgia.
Pl.‟s Dep. Ex. 2, Security Deed.
United
Bank
Mutual Bank, FA.
specially
endorsed
the
Note
Pl.‟s Dep. Ex. 1, Note.
to
Washington
United Bank also
assigned the Note and Security Deed to Washington Mutual Bank,
FA.
Pl.‟s Dep. Ex. 7, Assignment; accord Def.‟s Statement of
Undisputed
Material
Facts
Assignment, ECF No. 53-4.
was
invalid
because
[hereinafter
Def.‟s
SMF]
Ex.
C,
Haynes contends that the assignment
“Washington
Mutual
Bank,
FA”
was
a
“nonexistent banking institution” at the time of the assignment
in 2006 because Washington Mutual Bank, FA changed its name to
Washington
Mutual
Bank
in
2005.
The
record
establishes,
however, that Washington Mutual Bank (“WaMu”) continued to do
business under the name Washington Mutual Bank, FA in a number
of states, and WaMu informed Plaintiff of this fact in each of
6
his monthly mortgage statements.
E.g., Def.‟s SMF Ex. 8 at
HAYNES 0401-0402, Home Loan Statement, Apr. 2006.
WaMu endorsed
the Note in blank, Def.‟s SMF Ex. A, Note, ECF No. 53-2, though
Haynes
appears
to
contend
that
the
endorsement
is
invalid
because the signature of WaMu‟s representative was affixed with
a rubber stamp.
WaMu became the servicing agent for Haynes‟s loan.
Haynes
received notice that his loan had been assigned to WaMu, and he
made his loan payments to WaMu.
contends
that
he
was
Pl.‟s Dep. 39:2-21.
misled
about
the
Haynes now
assignment
“due
to
material facts relating to this case that has [sic] surfaced
during discovery phase after the deposition that was given by
Plaintiff,” Pl.‟s SMF ¶ 7, but Haynes pointed to no specific
evidence of how he was misled.
Haynes also contends that he
made mortgage payments to “Washington Mutual Bank, Inc.” and
that WaMu stole his money.
Haynes‟s contentions appear to be
based on his assertion that Washington Mutual Bank, FA, was a
different
above,
entity
however,
than
Washington
Washington
Mutual
Mutual
Bank.
Bank
did
As
discussed
business
as
Washington Mutual Bank, FA, and was never a separate entity.
Haynes went into default on the Note in June 2008, and he
owes more than $400,000 on the Note and Security Deed.
Pl.‟s
Dep. 82:5-17; Notice of Removal Ex. A, JPMorgan Chase Bank, N.A.
Decl. ¶ 7, ECF No. 1-1.
Haynes now asserts that “no payments
7
were ever due to WaMu,” Pl.‟s SMF ¶ 10, but he points to no
evidence that he did not default on his loan or that he does not
owe more than $400,000 under the Note and Security Deed.
He
does contend that he did not owe any money to WaMu and that he
does not owe any money to Chase.
On
September
25,
2008,
the
Federal
Deposit
Insurance
Corporation (“FDIC”) declared WaMu insolvent and put it into
receivership.
No. 1-2.
Notice of Removal Ex. B, Schoppe Aff. ¶ 2, ECF
Also on September 25, 2008, Chase acquired from the
FDIC receivership “all loans and all loan commitments” of WaMu.
Id.
¶
4;
accord
Agreement,
Sept.
Def.‟s
25,
SMF
2008,
Ex.
ECF
D,
No.
Purchase
53-5.
&
Chase
Assumption
became
the
assignee of the Note and Security Deed, and Chase became the
servicing agent for Haynes‟s loan.
hand,
Haynes
evidence
to
summarily
rebut
them;
denies
on
E.g., id. § 3.1.
these
the
facts
other
but
hand,
On one
points
he
acknowledge that Chase received servicing rights.
to
no
appears
to
See, e.g.,
Pl.‟s Resp. in Opp‟n to Def.‟s Mot. for Summ. J. 5, ECF No. 56-1
(stating that Chase “received servicing rights” to the Note in
this case);
stand
in
accord
the
shoes
id.
of
at 12 (acknowledging that Chase “may
WaMu”
with
regard
to
his
Note
but
contending that Chase is “holding the same sack of crap that
WaMu was holding”).
8
Pursuant to the Purchase Agreement and a Power of Attorney
granted to Chase by the FDIC, Chase signed an assignment of
Haynes‟s Note and Security Deed from WaMu to Chase, and that
assignment was recorded in the Morgan County Superior Court in
the
spring
of
2010.
E.g.,
Def.‟s
SMF
Attach.
9
Ex.
G,
Assignment and Limited Power of Attorney, ECF No. 53-16; Def.‟s
SMF Ex. D, Purchase & Assumption Agreement § 9.2, Sept. 25,
2008, ECF No. 53-5.
Haynes contends that the assignment is
invalid.
Chase holds physical possession of the original Note and
Security Deed.
E.g., Def.‟s SMF Attach. 7, Gill Decl. ¶¶ 6-9,
ECF No. 53-7 (explaining chain of custody of Note and Security
Deed); Def.‟s SMF Attach. 8, Herndon Decl. ¶¶ 6-9, ECF No. 53-8
(same);1 see also Pl.‟s SMF Opp‟n Attach. 13, Will Aff. ¶¶ 14,
18-19,
ECF
No.
Plaintiff‟s,
on
56-13
Note
(„wet‟)” signatures).
possession
of
the
(finding
and
Security
that
signatures,
Deed
were
including
“original
inked
Haynes denies that Chase holds physical
Note
and
Security
Deed
but
points
to
no
evidence to rebut this fact.
Haynes learned in September 2008 that WaMu had gone into
receivership and that Chase was taking over its assets.
1
Pl.‟s
Haynes objects to the declarations of Gill and Herndon because they
are not sworn or notarized.
The declarations were, however,
subscribed as true under penalty of perjury, so the Court may consider
them.
See 28 U.S.C. § 1746 (stating that unsworn declaration under
penalty of perjury has same force and effect as sworn affidavit).
9
Dep.
48:2-49:14.
Haynes
received
statements
from
Chase
notifying him that his loan had been acquired by Chase and that
Chase would be servicing it.
Id. at 123:22-124:4; accord Pl.‟s
Dep. Ex. 17, Home Loan Statement, Jan. 2009.
Haynes summarily
denies these facts but points to no evidence to rebut them.2
Haynes filed a Chapter 7 bankruptcy proceeding in September
2008.
He did list “Washington Mutual Bank” and “Washington
Mutual Mortgage” as creditors.
Pelham
to
D.
Haynes,
July
Pl.‟s Dep. Ex. 5, Letter from J.
14,
2010,
at
HAYNES
bankruptcy was discharged on December 31, 2008.
0390.
0392.
The
Id. at HAYNES
After the bankruptcy, Haynes made several payments on his
mortgage so that he could avoid foreclosure.
63:10.
Pl.‟s Dep. 62:23-
His payments became less regular and more sporadic; he
continued to try and make payments until October 2009.
63:25-65:3,
payments
124:24-125:22.
after
his
October
Haynes
2009
2
stopped
payment.
making
Id.
at
Id. at
mortgage
125:7-12.
Haynes did file his own affidavit, to which Chase objects, stating:
“I do not now have, or at any time had, a relationship with the named
Defendant and thereby deny all of Defendants allegations of
indebtedness.”
Pl.‟s SMF Opp‟n Attach. 14, Pl.‟s Aff. ¶ 4, ECF No.
56-14. Haynes contends that the conflicts between his deposition and
his affidavit exist because Chase committed “fraud.”
Based on the
Court‟s review of Haynes‟s briefs and other papers, it appears that
the alleged fraud is that (1) United Bank transferred Haynes‟s Note
and
Security
Deed
to
a
“nonexistent
bank,”
and
(2)
the
transfer/assignment of the Note and Security Deed to Chase was
fraudulent and invalid because someone other than Chase owns his loan.
As discussed in this Order, Haynes pointed to no competent evidence of
either assertion.
10
Haynes
now
summarily
denies
these
facts
but
points
to
no
evidence to rebut them.
Chase referred Haynes‟s loan for foreclosure, and Haynes
received letters from Chase‟s attorneys notifying Haynes that
his
loan
had
been
referred
for
foreclosure sale had been scheduled.
foreclosure
and
that
a
Pl.‟s Dep. Ex. 9, Letter
from A. DeMarlo to D. Haynes, Dec. 2, 2009 (notifying Haynes of
foreclosure sale scheduled for January 5, 2010); Pl.‟s Dep. Ex.
12,
Letter
from
A.
DeMarlo
to
D.
Haynes,
Dec.
31,
2009
(notifying Haynes of foreclosure sale scheduled for February 2,
2010).
Haynes
improper
because
contends
they
that
listed
the
foreclosure
Washington
Mutual
notices
Bank
were
as
the
servicer even though WaMu had ceased operations by that point.
Haynes also contends that the foreclosure notices were improper
because they listed Chase as the creditor; Haynes asserts that
the
Federal
Home
Loan
Mortgage
Corporation
(“Freddie
Mac”)
actually owns his loan, but he points to no competent evidence
in support of that assertion.
Haynes filed this action on January 4, 2010, seeking a stay
of the foreclosure.
No foreclosure has taken place, and Haynes
continues to occupy the Property.
Haynes pointed to no evidence
that anyone other than Chase is attempting to foreclose on or
assert any claim to the Property.
11
III. Discussion
Haynes
does
Security Deed.
not
mortgage
that
he
signed
the
Note
and
He does not dispute that he owes more than
$400,000 on his loan.
a
dispute
payment
He does not dispute that he has not made
since
October
2009
default under the Note and Security Deed.
and
is
therefore
in
Haynes‟s own expert
concluded that the Note and Security Deed in Chase‟s possession
each
contain
Plaintiff‟s
“original
inked
(„wet‟)”
signature.
Pl.‟s SMF Opp‟n Attach. 13, Will Aff. ¶¶ 14, 18-19, ECF No. 5613.
The only remaining question is whether Chase has any rights
in the Note and Security Deed such that it may foreclose on the
Property.3
Chase argues that it has the right to foreclose on the
Property for four reasons: (1) Chase is the assignee of the
Security Deed and Note under the FDIC Purchase Agreement, (2)
Chase is the assignee of the Security Deed and Note by virtue of
the assignment from WaMu to Chase, (3) Chase is the holder of
3
Haynes contends that Chase is “barred from a Summary Judgment on all
counts of Defendants complaint and is forever barred from foreclosing
on” the Property due to “unclean hands, fraud upon the court, fraud
upon the Plaintiff and fraud in the factum & inducement, Assignment &
Title Fraud/Slander of Title, Violations of the Georgia Residential
Mortgage Act & Mortgage Fraud, Violation of Fair Debt Collection Act,
Negligent Supervision, Tortious Interference with Contract & Business
Relationships, Violation of Fiduciary Duty, Violation of Good Faith &
Fair Dealing, Violation of Georgia‟s Racketeering Statutes (RICO),
Unjust Enrichment, Breach of Contract, Violations of the Real Estate
Settlement and Procedures Act (RESPA), Violations of the Federal
Truth-In-Lending Act (TILA), Violation of Fair Credit Reporting Act,
Fraudulent Misrepresentation and Usury.”
Pl.‟s Resp. to Def.‟s Mot.
for Summ. J. 2, ECF No. 56. Haynes points to no evidence in support
of these claims.
12
the original Note, and (4) Chase is the servicer of the loan
with the right to take actions necessary to collect, enforce,
and
administer
the
obligations
of
the
Security
Deed.
As
discussed below, Chase presented evidence to demonstrate that it
is the assignee of the Security Deed and Note.
pointed
the
dispute
on
Court
these
to
evidence
issues,
so
that
Chase
creates
is
Haynes has not
a
genuine
entitled
to
fact
summary
judgment.
Under Georgia law, a transferee or assignee of a security
deed is authorized to exercise the power of sale contained in
the security deed.
O.C.G.A. § 23-2-114.
A transfer of a deed
to secure debt “may be endorsed upon the original deed or by a
separate
instrument
identifying
the
transfer
and
shall
be
sufficient to transfer the property therein described and the
indebtedness therein secured.”
O.C.G.A. § 44-14-64(b).
Haynes
contends that Chase was not a transferee or assignee of the
Security Deed and Note because both the initial assignment from
United Bank to WaMu and the subsequent transfer from WaMu to
Chase were “fraudulent and illegal.”
As discussed above, the undisputed record evidence shows
that
on
March
17,
2006,
United
Bank
assigned
Security Deed to Washington Mutual Bank, FA.
the
Note
and
Pl.‟s Dep. Ex. 7,
Assignment; accord Def.‟s SMF Ex. C, Assignment, ECF No. 53-4.
Haynes argues that the assignment is invalid because “Washington
13
Mutual Bank, FA” was a “nonexistent banking institution” at the
time of the assignment in 2006, since Washington Mutual Bank, FA
changed its name to Washington Mutual Bank in 2005.
However,
“[t]he change of a corporation‟s name is not a change of the
identity of a corporation and has no effect on the corporation‟s
property, rights, or liabilities.”
1372, 1384 (5th Cir. 1980).4
or WaMu,
Alley v. Miramon, 614 F.2d
Moreover, Washington Mutual Bank,
continued to do business under the name Washington
Mutual Bank, FA in a number of states, and the bank informed
Plaintiff
of
statements.
this
fact
in
not
of
his
monthly
mortgage
E.g., Def.‟s SMF Ex. 8 at HAYNES 0401-0402, Home
Loan Statement, Apr. 2006.
was
each
invalid
simply
The Court finds that the assignment
because
it
listed
“Washington
Mutual
Bank, FA” as the assignee rather than “Washington Mutual Bank.”
Haynes
points
to
no
other
alleged
deficiencies
in
the
assignment, and the Court concludes that the assignment from
United Bank to WaMu was valid.5
The next question is whether
Chase
was
valid.
The
Court
the
concludes
4
transfer
that
it
from WaMu to
was.
Chase
In Bonner v. City of Prichard, 661 F.2d 1206, 1209 (11th Cir. 1981)
(en banc), the Eleventh Circuit adopted as binding precedent all
decisions of the former Fifth Circuit handed down prior to the close
of business on September 30, 1981.
5
Haynes does speculate that the Note and Security Deed were
transferred “to Freddie Mac to be placed in a Mortgage Backed Security
(MBS) and bundled with thousands of other mortgage loan and sold on
the New York Stock Exchange (NYSE).” Pl.‟s Resp. to Def.‟s Mot. for
Summ. J. 2, ECF No. 56.
He pointed to no competent evidence in
support of this contention.
14
pointed the Court to evidence that it acquired “all loans and
all loan commitments” of WaMu on September 25, 2008.
Notice of
Removal Ex. B, Schoppe Aff. ¶ 4, ECF No. 1-2; accord Def.‟s SMF
Ex. D, Purchase & Assumption Agreement, Sept. 25, 2008, ECF No.
53-5.
By virtue of the Purchase and Assumption Agreement, Chase
became the assignee of the Note and Security Deed, which had
been assigned to WaMu and specially endorsed to WaMu.
§
3.1;
accord
12
U.S.C. §
1821(d)(2)(G)(i)(II)
E.g., id.
(stating
that
FDIC may, as conservator or receiver, “transfer any asset or
liability
of
approval,
the
institution
assignment,
transfer”).
or
in
default
consent
with
.
.
.
without
respect
to
any
such
Haynes pointed the Court to no competent evidence
to rebut these facts, and the Court concludes that the transfer
from WaMu to Chase was valid.
In summary, this is not, as Haynes suggests, a case in
which
a
bank
sought
to
institute
a
foreclosure
action
even
though the bank had no evidence that it had ever owned or been
assigned the mortgage at issue.
In contrast, the undisputed
evidence establishes that Chase is the assignee of the Note and
Security Deed.
Accordingly, under Georgia law, Chase
right to foreclose on the Property.
Chase‟s summary judgment motion.
15
has a
The Court therefore grants
CONCLUSION
For the reasons set forth above, Chase‟s Motion for Summary
Judgment (ECF No. 53) is granted, Plaintiff‟s Motion to Strike
(ECF No. 51) is denied, and Plaintiff‟s Motion for Leave to File
Sur-reply (ECF No. 59) is denied.
IT IS SO ORDERED, this ____ day of ______, 2011.
S/Clay D. Land
CLAY D. LAND
UNITED STATES DISTRICT JUDGE
16
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