Innocent et al v. Wachovia Mortgage Corporation
Filing
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ORDER denying Defendant's 9 Motion to Dismiss Plaintiffs' Amended Complaint. Signed by Judge Richard W. Story on 2/22/12. (cem)
IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF GEORGIA
ATLANTA DIVISION
MAGALIE C. INNOCENT,
FRITZ INNOCENT, JR.,
Plaintiffs,
v.
WACHOVIA MORTGAGE
CORPORATION,
Defendant.
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CIVIL ACTION NO.
1:10-CV-03799-RWS
ORDER
This case comes before the Court on Defendant’s Motion to Dismiss
Plaintiffs’ Amended Complaint [9]. After a review of the record, the Court
enters the following Order.
Background
This case arises out of Defendant Wachovia Mortgage Corporation’s
foreclosure of Plaintiffs Magalie and Fritz Innocent’s home, located at 2506
Lenox Road, Conyers, Georgia 30094. Accepting the allegations of the
Amended Complaint [8] as true, the facts are as follows.
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On April 16, 2007, Plaintiffs executed a promissory note in favor of
Defendant for a construction loan. Am. Compl., Dkt. [8] ¶ 2. The note was
secured by a security deed to Plaintiffs’ property, also in favor of Defendant.
Id. ¶ 3. An addendum to the note provided that Plaintiffs would make interestonly payments during the construction phase of the loan, and that the loan
would convert to permanent financing if Plaintiffs satisfied the conversion
requirements under the agreement before April 2008. Id. ¶¶ 3-7, 9, 10. The
agreement also specified that, if Plaintiffs failed to meet the conversion
requirements by April 2008, the note would go into default and Defendant
would accelerate the balance of the loan. Id. ¶ 9.
In January 2008, Plaintiffs satisfied the conversion requirements, notified
Defendant of the same, and requested that the construction loan be converted to
permanent financing as agreed. Id. ¶¶ 8, 12, 13. Defendant, however, refused
to convert the loan and accelerated Plaintiffs’ debt in April 2008. Id. ¶¶ 14, 16.
Plaintiffs did not pay the remaining balance, and Defendant conducted a
nonjudicial foreclosure sale on September 2, 2008. Id. ¶ 19. Defendant did not
send Plaintiffs a notice of the foreclosure sale beforehand. Id. ¶¶ 20, 32.
On July 14, 2010, Plaintiffs filed their initial Complaint [1-1] against
Defendant in the Superior Court of Rockdale County, Georgia. Defendant
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timely removed to this Court on November 18, 2010 and filed a Motion to
Dismiss or, in the Alternative, Motion for a More Definite Statement [3]. The
Motions were referred to Magistrate Judge Brill, who issued an Order [7]
denying Defendant’s Motion to Dismiss and granting Defendant’s Motion for a
More Definite Statement. Plaintiffs filed their Amended Complaint [8] on
March 31, 2011, asserting claims for breach of contract and wrongful
foreclosure. Plaintiffs additionally request the Court to set aside the foreclosure
sale and to void or cancel the deed under power. Defendant now moves to
dismiss Plaintiffs’ Amended Complaint. The Court considers Defendant’s
Motion below.
Discussion
Defendant moves to dismiss the Amended Complaint on the grounds that
it is an impermissible shotgun pleading and that it fails to state a claim upon
which relief can be granted.
I.
Shotgun Pleading
Defendant argues that the Amended Complaint constitutes an
impermissible shotgun pleading that fails to comply with the pleading
requirements of the Federal Rules of Civil Procedure. The typical shotgun
pleading is one that “contains several counts, each one incorporating by
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reference the allegations of its predecessors, leading to a situation where most
of the counts (i.e., all but the first) contain irrelevant factual allegations and
legal conclusions.” Strategic Income Fund, LLC v. Spear, Leeds & Kellogg
Corp., 305 F.3d 1293, 1295 (11th Cir. 2002). The term also refers to pleadings
that are “replete with factual allegations and rambling legal conclusions.”
Osahar v. U.S. Postal Service, 297 F. App’x 863, 864 (11th Cir. 2008). The
Eleventh Circuit has repeatedly condemned the use of shotgun pleadings for
“imped[ing] the administration of the district courts’ civil docket.” PVC
Windoors, Inc. v. Babbitbay Beach Constr., N.V., 598 F.3d 802, 806 n.4 (11th
Cir. 2010). Indeed, shotgun pleadings require the court to sift through rambling
and often incomprehensible allegations in an attempt to separate the meritorious
claims from the unmeritorious, resulting in a “massive waste of judicial and
private resources.” Id. (citation omitted). The Eleventh Circuit thus has
established that shotgun pleading is an unacceptable form of establishing a
claim for relief. Strategic Income Fund, 305 F.3d at 1296.
The Court finds that Plaintiffs’ Amended Complaint is not a shotgun
pleading. The Amended Complaint does not contain several counts but rather
two causes of action and two requests for equitable relief. The allegations are
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neither rambling nor incomprehensible. Thus, Plaintiffs’ Amended Complaint
is not subject to dismissal as a shotgun pleading.
II.
Failure to State a Claim
Defendant also moves to dismiss the Amended Complaint under Federal
Rule of Civil Procedure 12(b)(6) for failure to state a claim for which relief can
be granted. When considering a 12(b)(6) motion to dismiss, a federal court is to
accept as true “all facts set forth in the plaintiff’s complaint.” Grossman v.
Nationsbank, N.A., 225 F.3d 1228, 1231 (11th Cir. 2000) (citation omitted).
Further, the court must draw all reasonable inferences in the light most
favorable to the plaintiff. Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555-56
(2007) (internal citations omitted); Bryant v. Avado Brands, Inc., 187 F.3d
1271, 1273 n.1 (11th Cir. 1999). However, “[a] pleading that offers ‘labels and
conclusions’ or ‘a formulaic recitation of the elements of a cause of action will
not do.’” Ashcroft v. Iqbal, 556 U.S 662, 129 S. Ct. 1937, 1949 (2009) (quoting
Twombly, 550 U.S. at 555). “Nor does a complaint suffice if it tenders ‘naked
assertion[s]’ devoid of ‘further factual enhancement.’” Id.
The United States Supreme Court has dispensed with the rule that a
complaint may only be dismissed under Rule 12(b)(6) when “‘it appears beyond
doubt that the plaintiff can prove no set of facts in support of his claim which
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would entitle him to relief.’” Twombly, 127 U.S. at 561 (quoting Conley v.
Gibson, 355 U.S. 41, 45-46 (1957)). The Supreme Court has replaced that rule
with the “plausibility standard,” which requires that factual allegations “raise
the right to relief above the speculative level.” Id. at 556. The plausibility
standard “does not[, however,] impose a probability requirement at the pleading
stage; it simply calls for enough facts to raise a reasonable expectation that
discovery will reveal evidence [supporting the claim].” Id.
A.
Breach of Contract
Defendant argues that Plaintiffs have failed to state a claim for breach of
contract because they did not attach the contract to the Amended Complaint,
cite or describe the specific contractual provision allegedly breached, or identify
which document evidenced the contract at issue. Dkt. [9] at 8. At the pleading
stage, however, a complainant is not required to attach the written agreement or
to quote the allegedly breached provision verbatim. See Brenner v. Future
Graphics, LLC, No. 1:06-CV-0362-CAP, 2006 WL 6306540, at *5 (N.D. Ga.
Nov. 14, 2006) (holding that plaintiff asserting breach of contract need not
attach contract to complaint to survive motion to dismiss).
“Under Georgia law, a plaintiff states a claim for breach of contract when
he alleges: (1) the parties had a contract, (2) which the defendant breached, and
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(3) the plaintiff suffered damages.” Brenner, 2006 WL 6306540, at *4. In the
present case, Plaintiffs have alleged that they contracted with Defendant to
receive construction-to-permanent financing for their home. Am. Compl., Dkt.
[8] ¶¶ 3, 4. The contract allegedly provided that “if Borrower meets all the note
holder’s requirements, the loan will convert for [sic] the construction phase to
the permanent phase.” Id. ¶ 5. Plaintiffs have also alleged that they made all
the necessary payments and “complied with all of the conversion
requirements.” Id. ¶¶ 8, 12. Finally, Plaintiffs have alleged that Defendant
“refused to convert the Plaintiff’s [sic] loan to the permanent phase” and that
Plaintiffs suffered compensatory damages in an amount to be proven at trial.
Id. ¶¶ 14, 37. Accepting Plaintiffs’ allegations as true, the Court finds that
Plaintiffs have stated a claim for breach of contract.
B.
Wrongful Foreclosure
Defendant argues that Plaintiffs have failed to state a claim for wrongful
foreclosure because the Amended Complaint alleges insufficient facts to
establish a violation of Georgia’s foreclosure statutes. Dkt. [9] at 11. “In
Georgia, a plaintiff asserting a claim for wrongful foreclosure must establish a
legal duty owed to plaintiff by the foreclosing party, a breach of that duty, a
causal connection between the breach and the injury sustained, and damages.”
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Kabir v. Statebridge Co., No. 1:11-CV-2747-WSD, 2011 WL 4500050, at *3
(N.D. Ga. Sept. 27, 2011) (citing All Fleet Refinishing, Inc. v. W. Ga. Nat.
Bank,,634 S.E.2d 802, 807 (Ga. Ct. App. 2006)).
In the present case, Plaintiffs have alleged that Defendant did not give
them notice of the foreclosure sale and that they suffered damages as a result.
Am. Compl., Dkt. [8] ¶¶ 20, 32, 33. Georgia law requires a secured creditor to
provide the debtor with written notice of the scheduled foreclosure sale at least
thirty days in advance. O.C.G.A. § 44-14-162.2 (2011). “Where a foreclosing
creditor fails to comply with the statutory duty to provide notice of sale to the
debtor in accordance with O.C.G.A. § 44-14-162 et seq., the debtor may either
seek to set aside the foreclosure or sue for damages for the tort of wrongful
foreclosure.” Roylston v. Bank of Am., N.A., 660 S.E.2d 412, 417 (Ga. Ct.
App. 2008). Accepting Plaintiffs’ allegations as true, the Court finds that
Plaintiffs have sufficiently stated a claim for wrongful foreclosure.
C.
Claims for Equitable Relief
Relying on the foregoing causes of action, Plaintiffs request the Court to
set aside the foreclosure sale and to void or cancel Defendant’s deed under
power. Am. Compl., Dkt. [8] ¶¶ 21-26. Because these remedies are dependent
upon the viability of Plaintiffs’ breach of contract and wrongful foreclosure
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actions, neither request for equitable relief is subject to dismissal at this time.
See Stimus v. CitiMortgage, Inc., No. 5:10-CV-435(MTT), 2011 WL 2610391,
at *5 (M.D. Ga. July 1, 2011) (refusing to dismiss request to set aside
foreclosure sale after holding that breach of contract and wrongful foreclosure
claims survived defendant’s motion to dismiss).
Conclusion
Based on the foregoing, Defendant’s Motion to Dismiss Plaintiffs’
Amended Complaint [9] is hereby DENIED.
SO ORDERED, this 22nd day of February, 2012.
_______________________________
RICHARD W. STORY
UNITED STATES DISTRICT JUDGE
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