FEDERAL NATIONAL MORTGAGE ASSOCIATION v. EDDINGS et al
ORDER granting 43 Motion for Summary Judgment. Ordered by U.S. District Judge Clay D. Land on 12/10/2013. (CGC)
IN THE UNITED STATES DISTRICT COURT
FOR THE MIDDLE DISTRICT OF GEORGIA
FEDERAL NATIONAL MORTGAGE
CASE NO. 4:12-CV-72 (CDL)
MICHAEL A. EDDINGS, THE LAW
OFFICE OF MICHAEL A. EDDINGS,
P.C., and APEX TITLE, INC.,
O R D E R
Defendants Michael A. Eddings, The Law Office of Michael A.
sold by Plaintiff Federal National Mortgage Association (“Fannie
Defendants’ trust account and Fannie Mae deeded the properties
funds to Fannie Mae.
Fannie Mae now seeks to recover under
several theories, including money had and received, breach of
fiduciary duty, conversion, and fraud.
Presently pending before
the Court is Fannie Mae’s Motion for Summary Judgment (ECF No.
43), which is unopposed.
As discussed below, the motion is
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).
In determining whether a
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.
477 U.S. 242, 255 (1986).
Anderson v. Liberty Lobby, Inc.,
A fact is material if it is relevant
or necessary to the outcome of the suit.
Id. at 248.
dispute is genuine if the evidence would allow a reasonable jury
to return a verdict for the nonmoving party.
Eddings did not respond to Fannie Mae’s summary judgment
statements are thus deemed admitted pursuant to Local Rule 56.
The Court must still review Fannie Mae’s citations to the record
to determine whether a genuine fact dispute exists.
Taser Int’l, Inc., 588 F.3d 1291, 1303 (11th Cir. 2009).
materials submitted by Fannie Mae in support of its summary
judgment motion establish the following.1
Fannie Mae relies in part on its requests for admissions, which are
deemed admitted pursuant to Federal Rule of Civil Procedure 36(a)(3)
The Eddings Defendants maintained a trust account with a
The Eddings Defendants, serving as closing attorney
properties sold by Fannie Mae.
The first real estate closing
was for the property located at 4731 11th Avenue, Apt. 6 in
Fannie Mae sold that property to two buyers.
Defendants’ trust account, Fannie Mae deeded the property to the
Fannie Mae, and Fannie Mae received no proceeds from the sale.
Instead, the Eddings Defendants kept the sale proceeds.
The second real estate closing was for property located at
5207 Summerbrooke Lane in Phenix City, Alabama.
that property to one buyer.
Fannie Mae sold
The buyer wired funds totaling
$194,137.49 into the Eddings Defendants’ trust account, Fannie
Mae deeded the property to the buyer, and Fannie Mae was due to
The Eddings Defendants failed to disburse
the sale proceeds to Fannie Mae, and Fannie Mae received no
proceeds from the sale.
Instead, the Eddings Defendants kept
the sale proceeds.
because the Eddings Defendants never responded to Fannie Mae’s
requests for admissions and never asked that the deemed admissions be
withdrawn or amended.
disburse the proceeds from both sales to Fannie Mae even though
they knew the representation was false.
Fannie Mae demanded in
writing that the Eddings Defendants disburse the sale proceeds
totaling $212,425.45 to Fannie Mae, but the Eddings Defendants
never disbursed the funds.
including (1) money had and received, (2) breach of fiduciary
duty, (3) conversion, and (4) fraud.
The Court is satisfied
that Fannie Mae has established the elements of each claim.
“An action for money had and received is founded upon the
equitable principle that no one ought unjustly to enrich himself
at the expense of another, and is maintainable in all cases
where one has received money under such circumstances that in
equity and good conscience he ought not to retain it,” and in
justice and fairness “it belongs to another.”
(internal quotation marks omitted).
It does not matter how the
money came “into the defendant’s hands, and the fact that it was
received from a third person will not affect his liability, if,
in equity and good conscience, he is not entitled to hold it
(internal quotation marks omitted).
Here, it is undisputed that
the Eddings Defendants received and held sale proceeds totaling
belong to the Eddings Defendants and that it was due to Fannie
“In an action for breach of fiduciary duty, establishing a
claim requires proof of three elements: (1) the existence of a
proximately caused by that breach.”
Rollins v. Rollins, 321 Ga.
App. 140, 150-51, 741 S.E.2d 251, 259 (2013) (internal quotation
An attorney who participates in the closing of
a real estate transaction “is a fiduciary with respect to the
closing proceeds, which must be handled in accordance with the
trust account and IOLTA provisions in” the Georgia Rules of
Formal Advisory Op. No. 04-1, 280 Ga.
227, 228, 626 S.E.2d 480, 481 (2006) (per curiam).
Here, it is
undisputed that the Eddings Defendants had a duty to hold the
Defendants’ own funds and that the Eddings Defendants had a duty
to disburse those funds to Fannie Mae.
It is also undisputed
that the Eddings Defendants breached that duty by failing to
disburse the sale proceeds totaling $212,425.45 to Fannie Mae.
Finally, it is undisputed that Fannie Mae suffered damages in
the form of lost proceeds because of the Eddings Defendants’
fiduciary duty claim.
belonging to another, in hostility to his rights; an act of
dominion over the personal property of another inconsistent with
his rights; or an unauthorized appropriation.”
Trey Inman &
Assocs., P.C. v. Bank of Am., N.A., 306 Ga. App. 451, 457, 702
S.E.2d 711, 716 (2010) (internal quotation marks omitted).
establish conversion, Fannie Mae must show “(1) title to the
property or the right of possession, (2) actual possession in
the other party, (3) demand for return of the property, and (4)
(internal quotation marks omitted).
Though money is “fungible
intangible personal property” that is generally not subject to
an action for conversion, a “specific and identifiable” amount
of money placed on deposit in a bank can be a proper subject for
a conversion claim.
Id. at 458, 702 S.E.2d at 717 (internal
quotation marks omitted).
Here, Fannie Mae had a right to the
$212,425.45 in sale proceeds that were wired to the Eddings
Defendants’ trust account, but the Eddings Defendants retained
possession of the funds despite Fannie Mae’s demand for them.
Thus, Fannie Mae prevails on its conversion claim.
To state a claim for fraud, Fannie Mae must establish “(1)
false representation made by the defendant; (2) scienter, the
intent to deceive; (3) intent to induce the plaintiff to act or
refrain from acting in reliance upon the representation; (4)
justifiable reliance by the plaintiff upon the representation;
and (5) damages directly and proximately caused by reliance.”
Middleton v. Troy Young Realty, Inc., 257 Ga. App. 771, 772, 572
S.E.2d 334, 336 (2002).
Here, the present record supports the
would disburse the sale proceeds to Fannie Mae, even though they
knew that representation was false because they knew they would
not disburse the funds.
Fannie Mae has also established for
purposes of the present motion that the Eddings Defendants made
properties and that Fannie Mae relied on the representation to
As discussed above, the Court grants Fannie Mae’s Motion
for Summary Judgment (ECF No. 43).
The Eddings Defendants owe
Fannie Mae $212,425.45 as a matter of law.
Fannie Mae did not
Within 14 days of today’s Order, Fannie Mae
shall file an amended motion for summary judgment as to those
appropriate as to those claims, or notify the Court that it has
abandoned those claims.
Final judgment will be entered when all
claims that are being actively pursued have been adjudicated.
IT IS SO ORDERED, this 10th day of December, 2013.
S/Clay D. Land
CLAY D. LAND
UNITED STATES DISTRICT JUDGE
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