Hall v. HSBC Mortgage Services, Inc.

Filing 30

OPINION AND ORDER DENYING 26 Motion for Reconsideration. Signed by Judge William S. Duffey, Jr on 7/28/2015. (adg)

On June 12, 2013, Plaintiff his Complaint [1] asserting claims for breach of
contract (Count One); wrongful eviction (Count Two); and violation of the Fair
Debt Collection Practices Act (“FDCPA”), 15 U.S.C. § 1692 et seq. (Count Three).
Plaintiff, in his Complaint, argues that Defendant breached its contractual duties
under the Security Deed because Defendant’s acceptance of Plaintiff’s payments
for less than the full amount due formed a quasi-new agreement, departing from
the terms of the original loan between Plaintiff and Defendant. (Compl. ¶ 14).
On October 22, 2013, Magistrate Judge Fuller issued his R&R,
recommending that Defendant’s Motion to Dismiss be granted.
On November 8, 2013, after the R&R was issued, Plaintiff filed his Motion
to Amend, seeking to add additional claims for declaratory relief (Count One),
breach of contract (Count Two), “violation of O.C.G.A. § 44-14-162.2” (Count
Three), wrongful foreclosure (Count Four), and violation of the FDCPA (Count
Five). The crux of Plaintiff’s argument in his Amended Complaint is that
Defendant violated Paragraph 22 of the Security Deed, which provides:
22. Acceleration; Remedies. Lender shall give notice to Borrower
prior to acceleration following Borrower’s breach of any covenant or
agreement in this Security [Deed] . . . . The notice shall specify:
(a) the default; (b) the action required to cure the default; (c) a date, not
less than 30 days from the date the notice is given to Borrower, by
which the default must be cured; and (d) that failure to cure the default
on or before the date specified in the notice may result in acceleration
of the sums secured by this Security [Deed] and sale of the Property.
2

. . . If the default is not cured on or before the date specified in the
notice, Lender, at its option, may require immediate payment in full of
all sums secured by this Security [Deed] without further demand and
may invoke the power of sale granted by Borrower . . . .
(Security Deed ¶ 22). Plaintiff argues that Defendant breached the Security Deed
because it failed to give him proper notice of the default and an opportunity to cure
it before acceleration. Plaintiff asserts that “HSBC breached this obligation and
prematurely accelerated the debt and conducted a foreclosure sale of Plaintiff’s
Property by failing to provide adequate notice of default and acceleration to
Plaintiff and by failing to make any effort whatsoever to provide said notice to
Plaintiff.” (Am. Compl. [13.1] ¶ 33). Plaintiff did not provide any evidence to
support this claim and argument.
On March 11, 2014, the Court granted Defendant’s Motion to Dismiss and
expressly rejected Plaintiff’s argument that he and Defendant formed a quasi-new
agreement, finding that Plaintiff failed to state a claim for mutual departure,
pursuant to O.C.G.A. § 13-4-4, because Plaintiff failed to allege facts sufficient to
support that he and HSBC made a mutual departure from the terms of his loan and
Security Deed. The Court denied Plaintiff’s Motion to Amend on the ground that
it was untimely and the claims that Plaintiff sought to add in the Amended
Complaint would be futile. The Court, in its March 11th Order, specifically stated

3

that “Plaintiff is not entitled to an award of damages because he has not
sufficiently alleged causation.” (March 11th Order at 10).
Plaintiff appealed the Court’s decision to the United States Court of Appeals
for the Eleventh Circuit [20].
On September 19, 2014, the Eleventh Circuit affirmed the Court’s decision.
See Hall v. HSBC Mortg. Serv., Inc., 581 F. App’x 800 (11th Cir. 2014). The
Eleventh Circuit agreed that Plaintiff’s Motion to Amend would be futile because
[a]lthough Hall claims that the letters and notices HSBC sent to him
did not comply with the notice requirements of the security deed, Hall
nowhere provides the actual content of those letters and did not attach
them as exhibits to his proposed amended complaint. Instead, Hall
merely “tender[ed] naked assertions devoid of further factual
enhancement” which did not allow “the court to draw the reasonable
inferences that the defendant is liable for the misconduct alleged.”
Hall also failed to plead sufficient facts plausibly raising an inference
of causation and damages stemming from HSBC’s alleged breach of
contract.
Id. at 803. The Eleventh Circuit, citing BAC Loans Serv., L.P. v. Wedereit, 759
S.E.2d 867, 872 (Ga. Ct. App. 2014), found further that Plaintiff’s breach of
contract claim failed because Plaintiff did not plead facts showing causation and
damages resulting from Defendant’s alleged failure to give him proper notice of
the default and an opportunity to cure it before acceleration.
On October 10, 2014, Plaintiff filed his Motion. He argues that the Court
should reconsider its March 11th Order and grant his Motion to Amend because, in
4

view of the Georgia Court of Appeals’ decision in Wedereit, his proposed
Amended Complaint is not futile. Plaintiff asserts that he “only recently became
aware of” Wedereit, which was decided “after this court’s final order was entered
on or about March 11, 2014,” and that he “presented his brief on appeal prior to the
outcome was known in [] Wedereit.” (Mot. at 4-5).
II.

DISCUSSION
A.

Legal Standard

Plaintiff filed his Motion for Reconsideration pursuant to Rule 60(b) of the
Federal Rules of Civil Procedure. Rule 60(b) provides limited circumstances
under which a Court can relieve a party from a final judgment or order, including:
(1) mistake, inadvertence, surprise or excusable neglect; (2) newly discovered
evidence that, with reasonable diligence, could not have been discovered in time;
(3) fraud, misrepresentation, or other misconduct by an opposing party; (4) the
judgment is void; (5) the judgment has been satisfied, released or discharged,
reversed or vacated; or (6) any other reason that justifies relief. Fed. R. Civ. P.
60(b); Rease v. Harvey, 376 F. App’x 920, 921 (11th Cir. 2010).
The Court does not reconsider its orders as a matter of routine practice, and
motions for reconsideration must be filed “within twenty-eight (28) days after the
entry of the order or judgment.” LR 7.2 E., NDGa. A motion for reconsideration

5

should not be used to present the Court with arguments already heard and
dismissed, or to offer new legal theories or evidence that could have been
presented in the previously-filed motion. See Jones v. S. Pan Servs., 450 F. App’x
860, 863 (11th Cir. 2012); Pres. Endangered Areas of Cobb’s History, Inc. v. U.S.
Army Corps of Eng’rs, 916 F. Supp. 1557, 1560 (N.D. Ga. 1995), aff’d, 87 F.3d
1242 (11th Cir. 1996) (“A motion for reconsideration is not an opportunity for the
moving party and their counsel to instruct the court on how the court ‘could have
done it better’ the first time.”); cf. Arthur v. King, 500 F.3d 1335, 1343
(11th Cir. 2007); O’Neal v. Kennamer, 958 F.2d 1044, 1047 (11th Cir. 1992);
Bryan v. Murphy, 246 F. Supp. 2d 1256, 1259 (N.D. Ga. 2003). Motions for
reconsideration are left to the sound discretion of the district court. See Region 8
Forest Serv. Timber Purch. Council v. Alcock, 993 F.2d 800, 806 (11th Cir. 1993).
B.

Analysis

Plaintiff argues that the Court erred in denying his Motion to Amend, and he
relies on the Georgia Court of Appeals’ decision in Wedereit to support that his
proposed Amended Complaint is not futile. Plaintiff’s reliance on Wedereit is
misplaced.1

1

The Court notes that the Eleventh Circuit specifically cited to Wedereit—the
same case on which Plaintiff relies to support reconsideration—in finding that
6

In Wedereit, after denying BAC’s motion for summary judgment, the trial
court sua sponte granted summary judgment to Wedereit on his claim for breach of
contract based on BAC’s failure to give notice before accelerating Wedereit’s loan,
and granted Wedereit leave to amend his complaint to state a claim for wrongful
foreclosure based on the lack of pre-acceleration notice. On appeal, the Georgia
Court of Appeals affirmed, finding that BAC failed to comply with paragraph 22
of the security deed because, although the letters it sent to Wedereit gave him
notice that he was in default, they stated that he owed the full accelerated amount
of the loan, and did not provide notice of the action required to cure the default, the
date by which to cure, that failure to cure would result in acceleration, or that the
plaintiff had a right to reinstatement after acceleration. Id. at 871. The Court of
Appeals noted, however, that “to prevail on his claim for breach of contract,
Wedereit still has to show damages resulting from [the defendant’s] failure to give
pre-acceleration notice.” Id. at 872. Regarding Wedereit’s claim for wrongful
foreclosure based on the alleged premature acceleration, the Court of Appeals held
that there was “a genuine issue of material fact as to whether BAC’s failure to
provide proper pre-acceleration notice entitles Wedereit to damages or equitable
relief.” Id. at 873.
Plaintiff failed to plead facts sufficient to support his breach of contract claim and
affirming the Court’s March 11th Order denying Plaintiff’s Motion to Amend.
7

On June 15, 2015, the Georgia Supreme Court reversed, holding that
“[b]ecause the record does not support the conclusion that Wedereit carried his
burden of proving that he was entitled to summary judgment as a matter of law on
his breach of contract claim, the trial court erred in awarding summary judgment
sua sponte to Wedereit.” See No. S14G1862, 2015 WL 3658827, at *4 (Ga.
June 15, 2015). The Georgia Supreme Court found that, although Wedereit
claimed in his complaint that BAC had breached the security deed, he did not
allege how it was breached and, in response to BAC’s motion for summary
judgment, Wedereit “submitted no evidence to affirmatively show that he could
carry his burden of proving the merits of his breach of contract claim.” Id. at * 2.
Although the letters in the record did not comply with the terms of the security
deed, “the fact that a defendant is not entitled to summary judgment on a plaintiff’s
breach of contract claim does not mean that the plaintiff is then automatically
entitled to sua sponte summary judgment on that claim.” Id. To be entitled to
summary judgment, a plaintiff must show “that there is no genuine issue of
material fact as to every element of his or her claims,” and therefore “it cannot be
said that, where a defendant is unable to show that there is no evidence sufficient
to create a jury issue on at least one essential element of a plaintiff’s case, a

8

plaintiff has automatically carried his or her burden of proving every element of his
or her case such that he or she is entitled to judgment as a matter of law.” Id. at *3.
Here, Plaintiff fails to allege facts sufficient support to support his claim for
breach of contract. It is well-settled that, to state a claim for breach of contract
under Georgia law, a plaintiff must show (1) a valid contract; (2) material breach
of its terms; and (3) damages arising from that breach. See Budget Rent-A-Care of
Atlanta, Inc. v. Webb, 469 S.E.2d 712, 713 (Ga. Ct. App. 1996); see also Bates
v. JPMorgan Chase Bank, NA, 768 F.3d 1126, 1130 (11th Cir. 2014). Plaintiff
fails to allege any facts to support his conclusory assertion that Defendant did not
comply with the notice requirements in the Security Deed, including because he
does not submit, or otherwise describe, the allegedly deficient letters.2
Even if he did provide the letters, Plaintiff fails to allege any facts to support
that he suffered damages as a result of Defendant’s alleged breach. It is undisputed
that Plaintiff had already defaulted on his loan obligations when the alleged breach
occurred. Plaintiff asserts in his proposed Amended Complaint that “[i]n or around
late 2009, Plaintiff began having difficulty making payments on the Note and
defaulted.” (Am. Compl. ¶ 10). Plaintiff does not allege any facts to show that a
2

The Court notes that, even after the Eleventh Circuit’s decision, Plaintiff still
has not “provide[d] the actual content of [any] letters and did not attach them as
exhibits to his [Motion].” See Hall, 581 F. App’x at 803.
9

notice complying with Paragraph 22 of the Security Deed would have prevented
the July 6, 2010, foreclosure.
That Plaintiff suffered “damage to his credit and reputation” was the result
of Plaintiff’s failure to make his loan payments, not the result of Defendant’s
alleged breach. See, e.g., Bates, 768 F.3d at 1132-33 (Mortgagor “must show that
the premature or improper exercise of some power under the deed . . . resulted in
damages that would not have occurred but for the breach.”); Rourk v. Bank of
Am., N.A., 587 F. App’x 597 (11th Cir. 2014) (mortgagor’s failure to make loan
payments “is fatal to her claim for breach of contract and wrongful foreclosure, as
her ‘alleged injury was solely attributable to her own acts or omissions.’”) (quoting
Heritage Creek Dev. Corp. v. Colonial Bank, 601 S.E.2d 842, 845 (Ga. Ct. App.
2004)). Plaintiff fails to show that he suffered damages caused by Defendant’s
alleged breach of the Security Deed and premature acceleration, and Plaintiff’s
claims in his proposed Amended Complaint are futile. Nothing in Wedereit
suggests otherwise.3
3

Although Plaintiff asserts in his Amended Complaint that he “has suffered
the loss of his Property, mental anguish, emotional pain and suffering and damage
to his credit reputation as a result of HSBC’s breach of the parties’ contract” (Am.
Compl. ¶ 35), damages for mental anguish and emotional pain and suffering cannot
be recovered in a breach of contract claim. See Davis v. Aetna Cas. & Sur. Co.,
314 S.E.2d 913, 917-918 (Ga. Ct. App. 1984), rev’d in part on other grounds, 320
S.E.2d 368 (Ga. 1984); Cummings v. Prudential Ins. Co. of Am., 542 F. Supp. 838,
10

Plaintiff does not assert the existence of “mistake, inadvertence, surprise, or
excusable neglect,” newly discovered evidence, fraud, or that the judgment has been
satisfied or is no longer applicable. Plaintiff’s arguments in his Motion and the

claims and allegations in his Amended Complaint have already been considered
and rejected by this Court and the Eleventh Circuit. Plaintiff simply has not
demonstrated any basis upon which the Court should reconsider its March 11th

Order. Plaintiff fails to address the bases on which the Court found that Plaintiff’s
proposed Amended Complaint was futile; specifically, that Plaintiff failed to
describe the content of Defendant’s allegedly defective letters and failed to allege
facts to support a causal connection between the allegedly defective notice and his
claimed damages. Plaintiff’s Motion is required to be denied.
III.

CONCLUSION
For the foregoing reasons,
IT IS HEREBY ORDERED that Plaintiff Andrew Hall’s Motion for

Reconsideration [26] is DENIED.

841 (S.D. Ga. 1982) (under Georgia law, damages for mental suffering arising out
of breach of contract, absent breach of a duty independent of contract, are not
recoverable).
11

SO ORDERED this 28th day of July, 2015.

_______________________________
WILLIAM S. DUFFEY, JR.
UNITED STATES DISTRICT JUDGE

12