Werner et al v. New York Community Bank et al
ORDER denying 6 Motion for Order to Show Cause; denying 6 Motion for TRO. Signed by District Judge Julian Abele Cook. (KDoa)
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MICHIGAN
YIHOSHUA WERNER AND HADASSAH C.
Case No. 12-10301
Honorable Julian Abele Cook, Jr.
NEW YORK COMMUNITY BANK, NYCB
MORTGAGE COMPANY, LLC, and AMTRUST
The Plaintiffs in this action, Yihoshua Werner and Hadassah C. Werner (hereinafter referred
to collectively as the “Werners”), contend, inter alia, that the Defendants, the New York Community
Bank, NYCB Mortgage Company, and Amtrust Bank are seeking to wrongfully foreclose on their
home. This action was filed in the Oakland County Circuit Court and subsequently removed by the
Defendants to this Court on the basis of its diversity jurisdiction. 28 U.S.C. §1332.
Currently before the Court is the Plaintiffs’ motion for a temporary restraining order that
would stay all foreclosure proceedings.
On January 27, 2006 the Werners executed an adjustable rate note in the amount of
$170,000.00 in favor of Great Lakes Mortgage Brokers, LLC on their property at 25300 Gardner
in Oak Park, Michigan. The Mortgage Electronic Registration Systems (“MERS”) was named to
act solely as the nominee for the lender. On the same day, Great Lakes Mortgage Brokers endorsed
the note to Ohio Savings Bank. This assignment is signed by Mr. Werner. On December 4, 2009,
the Office of Thrift Supervision took possession of the business and property interests of AmTrust
Bank, formerly known as the Ohio Savings Bank. The Federal Deposit Insurance Commission
(“FDIC”) was appointed as its receiver pursuant to 12 U.S.C. § 1821(c)(3)(A). On the same date,
the New York Community Bank acquired certain assets from AmTrust Bank, pursuant to an
agreement with the FDIC. As part of that arrangement, the New York Community Bank acquired
the Plaintiffs’ mortgage loan.
In 2008 and 2009, the Plaintiffs failed to pay the property taxes on their home. On December
1, 2010, the New York Community Bank intervened and paid $18,000 in taxes to satisfy the
outstanding tax obligations, preserve its own interest in the property, and avoid any potential tax
The last payment from the Werners was received by the New York Community Bank on
March 16, 2011. On May 16, 2011, the New York Community Bank notified the Plaintiffs that they
were in default on the mortgage loan, along with a warning to them that if they failed to cure the
arrearage by May 30, 2011, the entire debt would be accelerated. On June 7, 2011, the New York
Community Bank advised the Plaintiffs that they had several alternatives to foreclosure, including
a loan modification, a short-sale, or a deed in lieu of foreclosure.
On July 27, 2011, the New York Community Bank notified the Plaintiffs that it would
initiate foreclosure proceedings by advertisement. The Werners subsequently requested meditation,
and the parties met in November of 2011.
On November 14, 2011, the New York Community Bank offered the Werners a loan
modification. The modification letter stated that the offer would expire if the Plaintiffs did not sign
and return the agreement by November 28, 2011. On November 18, 2011, the Plaintiffs sent a
counter-proposal to the New York Community Bank.
On December 10, 2011, the New York Community Bank denied the request for a loan
modification. On December 15, 2011, the Plaintiffs were notified of a foreclosure sale scheduled for
January 17, 2012. On December 16th, 23rd, and 30th of 2011, and January 6th of 2012, notice of
the foreclosure sale was published in the Oakland County Legal News. On December 23, 2011, a
notice of the foreclosure sale was posted on the front door of the Plaintiff’s home.
An aggrieved party who seek to obtain a preliminary injunction bears the substantial burden
of demonstrating entitlement to the requested relief. A preliminary injunction or a TRO is an
extraordinary remedy, “which should be granted only if the movant carries his or her burden of
proving that the circumstances clearly demand it.” Leary v. Daeschner 228 F.3d 729, 739 (6th
Cir.2000). The court must consider four factors: (1) whether the moving party demonstrates a strong
likelihood of success on the merits; (2) whether the moving party would suffer irreparable injury
without the order; (3) whether the order would cause substantial harm to others; and (4) whether the
public interest would be served by the order. Ohio Republican Party v. Brunner, 543 F.3d 357, 361
(6th Cir.2008) (internal quotations omitted).
The Plaintiffs submit that they are likely to succeed on the merits of their claim for
permanent injunctive relief for several reasons. First, the Werners submit that the New York
Community Bank did not adjourn the foreclosure sale as required by Mich. Comp. Law § 600.3220.
That provision (1) regulates foreclosure by advertisement and (2) states that:
Such sale may be adjourned from time to time, by the sheriff or other officer or
person appointed to make such sale at the request of the party in whose name the
notice of sale is published by posting a notice of such adjournment before or at the
time of and at the place where said sale is to be made, and if any adjournment be for
more than 1 week at one time, the notice thereof, appended to the original notice of
sale, shall also be published in the newspaper in which the original notice was
published, the first publication to be within 10 days of the date from which the sale
was adjourned and thereafter once in each full secular week during the time for
which such sale shall be adjourned. No oral announcement of any adjournment shall
Under this statute, a foreclosing party who publishes an initial notice of foreclosure and sheriff’s sale
may continue to adjourn the sale from week to week without having to republish notice of the
adjournment in a newspaper. Only when there is an adjournment of more than one week is republication in a newspaper required.
The New York Community Bank published notice of the foreclosure sale on December 16th,
23rd, and 30th of 2011, and January 6th of 2012 in the Oakland County Legal News. On January
17, 2012, the Plaintiffs obtained from the state court an ex parte temporary restraining order halting
the scheduled foreclosure sale. The sale is currently scheduled for March 6, 2012. It is not clear to
the Court if the New York Community Bank has published subsequent notice of the foreclosure sale
or plans to do so in the coming weeks. However, the Plaintiffs are wrong to assert that an attempt
to sell without being in strict compliance with the statute must be declared to be void.
Even if a defect in the weekly adjournment notices exists, such a defect only “renders a
foreclosure sale voidable, not void.” Sweet Air Investment, Inc. v. Kenny, 275 Mich.App. 492, 502
(Mich. Ct. App. 2007). The foreclosure sale has not occurred. Further, it is clear that the Plaintiffs
are aware that their home is being foreclosed. The Plaintiffs have failed to establish that they would
likely prevail on their claim, as it is based on a remote and hypothetical future injury.
Next, the Plaintiffs submit that the Defendants violated Mich. Comp. Law § 600.3204(3).
This provision requires that: “if the party foreclosing a mortgage by advertisement is not the original
mortgagee, a record chain of title shall exist prior to the date of sale under section 3216 evidencing
the assignment of the mortgage to the party foreclosing the mortgage.” However, a recorded
assignment from the original mortgagee, MERS, to the New York Community Bank has been filed
with the Court as Exhibit 3 to the Defendants’ motion to dismiss (ECF 5, Ex. 4, at 2). Plaintiffs’
allegations regarding the transfer of the Plaintiffs’ loan from Great Lakes Mortgage Brokers to the
Defendants are not clear. Michigan law only requires that a foreclosing party be the mortgagee of
record in order to foreclose by advertisement under Mich. Comp. Law § 600.3204(1)(d). The New
York Community bank is clearly the mortgagee of record. (ECF 5, Exhibit 3). The Plaintiffs have
failed to establish a strong likelihood of success on the merits regarding this issue.
In their motion for a temporary restraining order the Plaintiffs appear to argue that the New
York Community Bank is not in possession of the promissory note and therefore cannot foreclose
using the non-judicial process. However, these arguments do not appear either substantively or by
inference in the causes of actions in the complaint. Therefore, the Court declines to examine the
likelihood of success on the merits.
Inasmuch as the Court has found that there is not a substantial likelihood that the Plaintiffs
will succeed on the merits in this action, it is unnecessary to examine the remaining three factors
under the Ohio Republican Party v. Brunner standard. Accordingly, the Plaintiffs’ motion for a
temporary restraining order is denied (ECF 6).
IT IS SO ORDERED.
Date: February 27, 2012
s/Julian Abele Cook, Jr.
JULIAN ABELE COOK, JR.
U.S. District Court Judge
CERTIFICATE OF SERVICE
The undersigned certifies that the foregoing Order was served upon counsel of record via the Court's ECF System to their respective
email addresses or First Class U.S. mail to the non-ECF participants on February 27, 2012.
s/ Kay Doaks
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