Mukendi v. Wells Fargo Bank N.A. et al

Filing 7

ORDER granting Defendants' Motions to Dismiss 4 and 6 . Plaintiff's 3 Motion for Declaratory Relief is DENIED. Accordingly, this case is DISMISSED. Signed by Judge Richard W. Story on 2/3/2014. (cem)

IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF GEORGIA
ATLANTA DIVISION
CHRISTOPHER RAPHAEL
MUKENDI,
Plaintiff,
v.
WELLS FARGO N.A.; WELLS
FARGO N.A., SUCCESSOR BY
MERGER TO WACHOVIA
BANK NATIONAL
ASSOCIATION; WELLS FARGO
HOME MORTGAGE, A
DIVISION OF WELLS FARGO
BANK N.A.; BARRETT DAFFIN
FRAPPIER LEVINE & BLOCK,
LLP; COUNTRYWIDE HOME
LOANS, INC.; and MORTGAGE
ELECTRONIC REGISTRATION
SYSTEMS, INC.
Defendants.

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CIVIL ACTION NO.
1:13-CV-1436-RWS

ORDER
This case is before the Court on: (1) Defendant Countrywide Home Loans
Inc.’s and Defendant Mortgage Electronic Registration Systems, Inc.’s (hereinafter
“MERS”) Motion to Dismiss [4], (2) Defendants Wells Fargo Bank N.A., Wells
Fargo Home Mortgage, a division of Wells Fargo Bank, N.A. and Wells Fargo
Bank, N.A. successor by merger to Wachovia Bank National Association’s

(collectively “Wells Fargo”) Motion to Dismiss [6], and (3) Plaintiff’s Motion for
Declaratory Relief [3].1 After reviewing the record, the Court enters the following
Order.
Background
In August 2004, Plaintiff Mukendi purchased real property located at 80
Mountain Court, Covington, Georgia 30016 (the “Property”). (Compl. ¶¶ 18, 40).
To finance the purchase, Plaintiff obtained a loan from Countrywide Home Loans
(“Countrywide”) and executed a security deed to secure the loan. The security
deed named Countrywide as the Lender, with MERS to act solely as nominee for
1

With his Motion for Declaratory Relief to Set Aside Foreclosure for
Injunctive Relief and Petition for Quiet Title, it appears Plaintiff seeks to amend his
pleadings by adding a claim for quiet title. This Court may deny such amendments
when the proposed amendment would not survive a motion to dismiss. Burger King
Corp. v. Weaver, 169 F.3d 1310, 1319 (11th Cir. 1999) (stating “denial of leave to
amend is justified by futility when the complaint as amended is still subject to
dismissal”). Here, Plaintiff’s petition for quiet title fails as a matter of law because he
has not satisfied procedural prerequisites to pleading a quiet title action under Georgia
law. See Montoya v. Branch Banking & Trust Co., 2012 U.S. Dist. LEXIS 31786
(N.D. Ga. Mar. 9, 2012) (dismissing claim for quiet title for failure to attach a plat of
survey of the land). The Georgia Quiet Title Act requires Plaintiff to file: (1) a plat of
survey of the land, (2) a copy of the immediate instrument or instruments, if any, upon
which the petitioner’s interest is based, and (3) a copy of the immediate instrument or
instruments of record or otherwise known to the petitioner, if any, upon which any
person might base an interest in the land adverse to the petitioner. O.C.G.A. § 23-3-62
(c) (2013). Because Plaintiff has not filed a plat of survey, his claim for quiet title
fails as a matter of law, and Plaintiff’s Motion [3] is Denied.

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Lender and Lender’s successors and assigns (“Countrywide Security Deed”). (Id.
¶15). On or about February 23, 2007, Plaintiff refinanced his Countrywide
mortgage with a $108,715.50 loan from Wachovia Bank National Association (the
“Wachovia Loan”), and he executed a new security deed evidencing this debt to
Wachovia (“Wachovia Security Deed”). [4-3]. The Wachovia Loan paid off the
prior Countrywide Loan, and so the Countrywide Security Deed was canceled.
Both the Wachovia Security Deed and cancellation of the Countrywide Security
Deed were recorded in the Newton County property records. [4-2, 4-3].
Plaintiff defaulted on his loan payments required under the Wachovia Loan,
and in accordance with the Wachovia Security Deed, Wells Fargo, as successor by
merger to Wachovia, initiated non-judicial foreclosure proceedings. [6-1 at 4].
Plaintiff filed this action in Newton County Superior Court, challenging
Defendants’ right to foreclose on the Property and alleging the following causes of
action: (1) “set aside foreclosure sale” (Count I) (Compl. ¶¶ 21-27); (2) wrongful
foreclosure attempt (Count II) (id. ¶¶ 28-38); (3) “breach of covenant or
agreement” (Count III) (id. ¶¶ 39-46); (4) “negligent servicing” (Count IV) (id.
¶¶ 47-53); and (5) fraud (Count V) (id. ¶¶ 54-73). Asserting diversity jurisdiction,
Defendants removed the action to this Court on April 29, 2013.

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Plaintiff previously filed a Motion for Temporary Restraining Order and/or
Preliminary Injunction [2]. This Court denied Plaintiff’s Motion, finding that
Plaintiff “failed to allege sufficient facts to demonstrate a substantial likelihood of
success on the merits of any of his claims and, moreover, has asserted legal
theories that are without merit.” [5]. Defendants Countrywide and MERS filed
their Motion to Dismiss on May 6, 2013, and the Wells Fargo Defendants filed
their collective Motion to Dismiss on November 14, 2013. Plaintiff has never filed
a response to either Motion to Dismiss, which indicates under this Court’s local
rules that there is no opposition to the instant Motions to Dismiss. See L.R. 7.1.
(B).
Discussion
I.

Motions to Dismiss
A.

Legal Standard

Federal Rule of Civil Procedure 8(a)(2) requires that a pleading contain a
“short and plain statement of the claim showing that the pleader is entitled to
relief.” While this pleading standard does not require “detailed factual
allegations,” mere 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, 678 (2009)
(quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007)) (stating “[n]or
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does a complaint suffice if it tenders ‘naked assertion[s]’ devoid of ‘further factual
enhancement’”). In order to withstand a motion to dismiss, “a complaint must
contain sufficient factual matter, accepted as true, to ‘state a claim to relief that is
plausible on its face.’ ” Id. (quoting Twombly, 550 U.S. at 570). A complaint is
plausible on its face when the plaintiff pleads factual content necessary for the
court to draw the reasonable inference that the defendant is liable for the conduct
alleged. Id.
When considering a Federal Rule of Civil Procedure 12(b)(6) motion to
dismiss, “all well-pleaded facts are accepted as true, and the reasonable inferences
therefrom are construed in the light most favorable to the plaintiff.” FindWhat
Investor Group v. FindWhat.com, 658 F.3d 1282, 1296 (11th Cir. 2011) (quoting
Bryant v. Avado Brands, Inc., 187 F.3d 1271, 1273 n.1 (11th Cir. 1999)).
However, the court does not “accept as true a legal conclusion couched as a factual
allegation.” Twombly, 550 U.S. at 555. “Threadbare recitals of the elements of a
cause of action, supported by mere conclusory statements, do not suffice.” Iqbal,
556 U.S. at 678.
“The district court generally must convert a motion to dismiss into a motion
for summary judgment if it considers materials outside the complaint.” D.L. Day
v. Taylor, 400 F.3d 1272, 1275-76 (11th Cir. 2005); see also Fed. R. Civ. P. 12(d).
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However, the Court may consider exhibits attached to the complaint,2 documents
that the complaint incorporates by reference (provided they are undisputed and
central to the pleaded claims),3 and materials of which the court may take judicial
notice,4 without converting a motion to dismiss into a motion for summary
judgment.
Finally, because Plaintiff is acting pro se, his “pleadings are held to a less
stringent standard than pleadings drafted by attorneys and will, therefore, be
liberally construed.” Tannenbaum v. United States, 148 F.3d 1262, 1263 (11th
Cir. 1998). “This leniency, however, does not require or allow courts to rewrite an
otherwise deficient pleading in order to sustain an action.” Thomas v. Pentagon
Fed. Credit Union, 393 Fed. App’x 635, 637 (11th Cir. 2010).
Analysis

B.

Plaintiff has never responded to Defendants’ Motions to Dismiss, which
renders these Motions as unopposed under the local rules. See L.R. 7.1(B).

2

Fed. R. Civ. P. 10(c).

3

D.L. Day, 400 F.3d at 1276 (“ ‘Undisputed’ means that the authenticity
of the document is not challenged”).
4

The Court may take judicial notice of public records without converting the
instant motions into motions for summary judgment. Universal Express, Inc. v.
S.E.C., 177 F. App’x 52, 53 (11th Cir. 2006).
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However, in light of Plaintiff’s pro se status, the Court will consider the merits of
the respective arguments.
The Court agrees with Defendants’ arguments that Plaintiff’s Complaint
violates Federal Rule of Civil Procedure 8(a). The Complaint is comprised
primarily of legal conclusions and contains few factual assertions. Some factual
allegations do not seem to relate to Plaintiff’s or Defendants’ actions in this case,
and to the extent that Plaintiff does allege facts relating to his circumstances, many
of them are refuted by the public records. Indeed, Plaintiff’s arguments appear to
rest on the mistaken allegation that Wells Fargo was an assignee of MERS under
the Countrywide Security Deed. Contrary to Plaintiff’s argument, Wells Fargo’s
authority to foreclose on Plaintiff’s Property arises from its rights as a secured
creditor under the Wachovia Security Deed. As Defendants argue, Plaintiff’s
remaining allegations do not rise above “a formulaic recitation of the elements of a
cause of action” that Rule 8(a) requires. See Ashcroft v. Iqbal, 556 U.S. 662, 678
(2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007)). Even
with leniency accorded to pro se plaintiffs, Plaintiff’s Complaint violates Rule
8(a).
Defendants further contend that Plaintiff’s Complaint should be dismissed
under Federal Rule of Civil Procedure 12(b)(6) for failure to state a claim. The
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Court agrees for the following reasons.
1.

Set Aside Foreclosure Sale (Count I)

In Count I, Plaintiff asks the Court to “set aside [the] foreclosure sale.”
(Compl., (Dkt. [1-1]) ¶ 21.) It appears that Plaintiff is challenging Wells Fargo’s
right to foreclose on the Property under the Countrywide Security Deed. (Id.
¶¶ 22-26.) Defendants move to dismiss this claim on the grounds that neither
Countrywide, nor any of its assigns, conducted a foreclosure sale of the Property
and that Wells Fargo has the authority to institute foreclosure proceedings under
the Wachovia Security Deed. [4 at 9; 6 at 9-10].
The Court agrees with Defendants that Plaintiff has failed to state a claim
under this Count. First, Plaintiff does not allege that any foreclosure sale, or
attempted foreclosure sale, was conducted by Countrywide or MERS prior to the
cancellation of the Countrywide Security Deed, so no claim for relief exists to set
aside a non-existent foreclosure sale. Second, under the Wachovia Security Deed,
Plaintiff granted Wachovia and its successors, including Wells Fargo,5 the
5

As a result of the merger, Wells Fargo acquired “all the property, rights,
powers, trusts, duties, and obligations” of Wachovia, including Plaintiff’s Wachovia
Security Deed, with the power of sale. See O.C.G.A. § 7–1–536(c) (in a merger, “each
party ... shall cease to exist as a separate entity but shall continue in, and the parties to
the [merger] shall be, a single corporation”); see also White v. Bank of Am., N.A.,
1:12-CV-3834-WSD, 2013 WL 1963786 (N.D. Ga. May 10, 2013) reconsideration
denied, 1:12-CV-3834-WSD, 2013 WL 6796460 (N.D. Ga. Dec. 23, 2013) (finding
successor-by-merger bank was entitled to exercise the power of sale in the Security
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authority to foreclose on his property. Specifically, the Wachovia Security Deed
states: “[Plaintiff] does hereby grant and convey [the property] to Lender and
Lender’s successors and assigns...in trust, with power of sale.” [4-3 at 2.] Plaintiff
agreed that if he defaulted on his loan agreement, Wachovia and its successors,
could “invoke the power of sale and any other remedies permitted by Applicable
Law.” Id. at 9. As successor-by-merger, Wells Fargo is thus entitled to exercise
the power of sale in the Wachovia Security Deed. See You v. JP Morgan Chase
Bank, N.A., 743 S.E.2d 428, 433 (Ga. 2013)(finding that the “[h]older of a deed to
secure debt is authorized to exercise the power of sale in accordance with terms of
the deed even if it does not also hold the note or otherwise have any beneficial
interest in the debt obligation underlying the deed”).
Accordingly, the Court finds that Wells Fargo has the authority, upon
Plaintiff’s default, to foreclose on the Property, and Plaintiff’s request to “set aside
foreclosure sale” (Count I) is DISMISSED.
2.

Wrongful Foreclosure Attempt (Count II)

In Count II, Plaintiff asserts a claim for wrongful foreclosure attempt. To
state a claim for attempted wrongful foreclosure under Georgia law, a plaintiff
must establish “a knowing and intentional publication of untrue and derogatory

Deed).
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information concerning the debtor’s financial condition, and that damages were
sustained as a direct result of this publication.” Aetna Finance Co. v. Culpepper,
320 S.E.2d 228, 232 (Ga. Ct. App. 1984). In the Complaint, Plaintiff alleges that
“Defendants falsely advertised the sale of [the Property]” and that “Defendants
failed to advertise the sale of the property for four consecutive weeks pursuant to
O.C.G.A. § 44-14-162.” (Compl., ¶¶ 36-37.) These statements do not show that
Defendants knowingly or intentionally published any untrue or derogatory
information concerning Plaintiff’s financial condition. They also do not
demonstrate that Plaintiff suffered damages. Therefore, Plaintiff has failed to state
a plausible claim for attempted wrongful foreclosure.
To the extent Plaintiff attempts to assert a claim for wrongful foreclosure,
the Court finds that this claim also fails. To state a claim for wrongful foreclosure,
a plaintiff must “establish a legal duty owed to it by the foreclosing party, a breach
of that duty, a causal connection between the breach of that duty and the injury it
sustained, and damages.” Racette v. Bank of Am., N.A., 733 S.E.2d 457, 462 (Ga.
Ct. App. 2012). “Failure to make the proper loan payments or tender the amount
due defeats any wrongful foreclosure or attempted wrongful foreclosure claims.”
White v. Bank of Am., N.A., 1:12-CV-3834-WSD, 2013 WL 1963786 (N.D. Ga.

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May 10, 2013) reconsideration denied, 1:12-CV-3834-WSD, 2013 WL 6796460
(N.D. Ga. Dec. 23, 2013).
Plaintiff does not allege, and it does not appear, that Plaintiff is current on
his loan payments under the Wachovia Security Deed. This omission subjects a
wrongful foreclosure claim to dismissal. Because Plaintiff has failed to state a
claim for wrongful foreclosure attempt or wrongful foreclosure, Count II is
DISMISSED.
3.

Breach of Covenant or Agreement (Count III)

In Count III, Plaintiff alleges Wells Fargo “failed to honor the terms of the
Security Deed.” (Compl., Dkt. [1-1] ¶ 41.) Specifically, he alleges that Wells
Fargo breached “paragraph 226 of the non-uniform covenant,” and as a result,
Plaintiff is “being dispossessed from his [P]roperty.” (Id. ¶¶ 43, 45.) Defendants
move to dismiss this claim on the grounds that Plaintiff has not even established
the existence of a contract, let alone alleged any facts to support his breach of
contract claim.
Under Georgia law, plaintiff “has the burden of pleading and proving the
existence of a valid contract by showing that there are ‘parties able to contract, a

6

Paragraph 22 of the Wachovia Security Deed requires Lender to cancel the
Security Deed upon satisfaction of the loan – which facts are not before this Court.
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consideration moving to the contract, the assent of the parties to the terms of the
contract, and a subject matter upon which the contract can operate.’” Eastview
Healthcare, LLC v. Synertx, Inc., 674 S.E.2d 641, 646 (Ga. Ct. App. 2009). Once
the existence of a contract is established, a plaintiff may only recover damages for
breach of contract by demonstrating: (1) plaintiff’s performance of the contract, (2)
defendant’s breach of the contract, and (3) the breach caused the plaintiff harm.
Jones v. Central Builders Supply Co., 121 S.E.2d 633, 638 (Ga. 1961) (citations
omitted).
Here, Plaintiff has not met his initial burden of pleading the existence of a
valid contract as he has not identified which contract is at issue and uses the
August 17, 2004 Countrywide Security Deed interchangeably with the February
23, 2007 Wachovia Security Deed. Furthermore, Plaintiff also has not pled facts in
support of his performance under the contract, Defendants’ breach and his harm.
the elements of a breach of contract claim. Consequently, Plaintiff has failed to
state a breach of contract claim for relief. Accordingly, Plaintiff’s claim for
“breach of covenant or agreement” (Count III) is DISMISSED.
4.

Negligent Servicing (Count IV)

In his claim for negligent servicing, Plaintiff alleges that Wells Fargo “owed
a duty to Plaintiff to avoid unreasonable risks of harm arising out of ordinary care
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to comply with standatd [sic], professional, and responsible practices relating to
mortgage lending and servicing.” (Compl.,¶ 48.) Plaintiff also contends that
Wells Fargo negligently serviced the loan, but fails to include facts regarding the
alleged negligent conduct. (Id. ¶ 49.) Defendants move to dismiss this claim on
the grounds that they did not owe Plaintiff a duty outside of the Security Deed, so
any tort claim must be dismissed. [4 at 15-17].
The Court agrees with Defendants that Plaintiff has not stated a claim for
relief. Plaintiff has not alleged any duty owed him by Defendants outside of the
Security Deed. Moreover, the Court of Appeals of Georgia has held that a
borrower and its secured lender have no relationship beyond that imposed by
contract. Commercial Bank & Trust Co. v. Buford, 243 S.E.2d 637, 638-39 (Ga.
Ct. App. 1978) (“[T]he only relationship between [borrower] and the bank was that
which arose out of the note and security deed.”). Therefore, any claim Plaintiff
may have arising out of the servicing of his loans must be asserted as a breach of
contract claim and not as a tort of “negligent servicing.” See Fielbon Dev. Co.,
LLC v. Colony Bank of Houston Cty., 660 S.E.2d 801, 808 (Ga. Ct. App. 2008)
(internal citations omitted) (under Georgia law, “[a]bsent a legal duty beyond the
contract, no action in tort may lie upon an alleged breach of [a] contractual duty”).
Therefore, Plaintiff’s claim for negligent servicing fails and is DISMISSED.
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5.

Fraud (Count V)

Plaintiff alleges that Defendants are liable for fraud because Plaintiff relied
to his detriment on Defendants’ representations to Plaintiff that they would not
foreclose on his Property while he was being considered for a loan modification.
Defendants argue that Plaintiff’s fraud claim should be dismissed for failure to
plead the elements of fraud with particularity, as required by Federal Rule of Civil
Procedure 9(b). [4 at 17-19; 6 at 12-14].
To state a claim for fraud under Georgia law, plaintiff must plead: “(1) a
false representation or omission of material fact; (2) scienter; (3) intention to
induce the party claiming fraud to act or refrain from acting; (4) justifiable
reliance; and (5) damages.” Lehman v. Keller, 677 S.E.2d 415, 417 (Ga. Ct. App.
2009) (quoting Meyer v. Waite, 606 S.E.2d 16, 20 (Ga. Ct. App. 2004)).
Allegations of fraud must also meet the heightened pleading standards of Federal
Rule of Civil Procedure 9(b), which requires a plaintiff to allege:
(1) precisely what statements were made in what documents or oral
representations or what omissions were made, and (2) the time and
place of each such statement and the person responsible for making
(or, in the case of omissions, not making) same, and (3) the content of
such statements and the manner in which they misled plaintiff, and (4)
what the defendants obtained as a consequence of the fraud.

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Centennial Bank v. Noah Group, LLC, 445 Fed. Appx. 277 (11th Cir. 2011) (citing
Ziemba v. Cascade Int’l, Inc., 256 F.3d 1194, 1202 (11th Cir. 2001)). Plaintiff’s
Complaint alleges that “Defendants knew that the Plaintiff relied Dfendants’ [sic]
misrepresentation that no foreclosre [sic] sale would be conducted on Defendant’s
Property” while he was being considered for a loan modification. This language
appears verbatim in other alleged wrongful foreclosure complaints filed in Newton
County, and Plaintiff does not provide any particularized facts detailing the “who,
what, when, where and why” required by Fed. R. Civ. P. 9 to support his fraud
claim against Countrywide, MERS or Wells Fargo. Plaintiff, therefore, has failed
to state a claim for fraud, and it must be DISMISSED.
Conclusion
In accordance with the foregoing, Defendants’ Motions to Dismiss [4 and 6]
are GRANTED. Plaintiff’s Motion for Declaratory Relief [3] is DENIED.
Accordingly, this case is DISMISSED.
SO ORDERED, this 3rd

day of February, 2014.

_______________________________
RICHARD W. STORY
UNITED STATES DISTRICT JUDGE

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