Bell v. Cameron-Hall et al

Filing 16

OPINION and ORDER Granting 10 MOTION for Judgment on the Pleadings - Signed by District Judge Laurie J. Michelson. (JJoh)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MICHIGAN
SOUTHERN DIVISION
HUBERT BELL,
Plaintiff,
v.

Case No. 14-cv-11486
Honorable Laurie J. Michelson
Magistrate Judge Michael J. Hluchaniuk

DOROTHY CAMERON-HALL,
US BANK NATIONAL ASSOCIATION
FIRST FRANKLIN MORTGAGE LOAN
TRUST,
Defendants.
OPINION AND ORDER GRANTING DEFENDANT’S MOTION FOR JUDGMENT
ON THE PLEADINGS [10]
Plaintiff Hubert Bell filed this lawsuit after Defendant U.S. Bank National Association,
as trustee for the holders of the First Franklin Mortgage Loan Trust (“Trustee” or “Defendant”),
foreclosed on a property he was renting from Defendant Dorothy Cameron-Hall. After removing
the case from state court, the Trustee filed a motion for judgment on the pleadings. Defendant
Hall has not yet been served, but the Trustee’s motion is fully briefed and the matter is now
ready for disposition. Having carefully reviewed the briefing, the Court finds that oral argument
will not aid in resolving the pending motion. See E.D. Mich. LR 7.1(f)(2). The Court finds that
Bell’s four-count complaint fails to state a claim on which relief can be granted. Accordingly, the
Court will DISMISS Bell’s claims against the Trustee.
I. LEGAL STANDARD
“When deciding a motion for judgment on the pleadings pursuant to Federal Rule of Civil
Procedure 12(c), the Court applies the same legal standard as it would for a Rule 12(b)(6) motion
to dismiss for failure to state a claim upon which relief can be granted.” Brody v. Genpact Servs.,

LLC, 980 F. Supp. 2d 817, 819 (E.D. Mich. 2013) (citing Albrecht v. Treon, 617 F.3d 890, 893
(6th Cir. 2010)). To survive a motion to dismiss under Rule 12(b)(6), a plaintiff “must allege
‘enough facts to state a claim of relief that is plausible on its face.’” Traverse Bay Area Int. Sch.
Dist. v. Mich. Dep’t of Educ., 615 F.3d 622, 627 (6th Cir. 2010) (quoting Bell Atlantic Corp. v.
Twombly, 550 U.S. 544, 570 (2007)). Facial plausibility means that “the complaint has to
‘plead[] factual content that allows the court to draw the reasonable inference that the
defendant[s are] liable for the misconduct alleged.’” Ohio Police & Fire Pension Fund v. Std. &
Poor’s Fin. Servs., LLC, 700 F.3d 829, 835 (6th Cir. 2012) (alteration in original) (quoting
Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009)). “This standard does not require detailed factual
allegations, but a complaint containing a statement of facts that merely creates a suspicion of a
legally cognizable right of action is insufficient.” HDC, LLC v. City of Ann Arbor, 675 F.3d 608,
614 (6th Cir. 2012) (citation and internal quotation marks omitted).
The court must “accept all well-pleaded factual allegations as true and construe the
complaint in the light most favorable to plaintiffs.” Bennet v. MIS Corp., 607 F.3d 1076, 1091
(6th Cir. 2010). The court “need not, however, accept unwarranted factual inferences.” Id. (citing
Twombly, 550 U.S. at 570). Nor are “[t]hreadbare recitals of the elements of a cause of action,
supported by mere conclusory statements” entitled to an assumption of truth. Iqbal, 556 U.S. at
678. “[W]here the well-pleaded facts do not permit the court to infer more than the mere
possibility of misconduct, the complaint has alleged—but it has not ‘show[n]’—‘that the pleader
is entitled to relief.’” Iqbal, 556 U.S. at 679 (quoting Fed. R. Civ. P. 8(a)(2)).
II. ALLEGATIONS OF THE COMPLAINT
Plaintiff Hubert Bell rented a house at 24266 Konarska Drive in Brownstown, Michigan
(“Property”). (Dkt. 1-2, Compl. at ¶ 5.) Defendant Dorothy Cameron-Hall owned the Property,

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and had secured a loan for the $248,000 purchase price with a mortgage through First Franklin,
A Division of National City Bank of Indiana. (Dkt. 10-1, Mortgage.) The mortgage was recorded
on September 26, 2005 in Wayne County, Michigan. (Id.) On August 3, 2009, First Franklin
assigned the Mortgage to Defendant US Bank National Association as Trustee. (Dkt. 10-2,
Assignment.) The Assignment was recorded on August 10, 2009 in Wayne County. (Id.)
Hall defaulted on the mortgage and the Trustee initiated foreclosure-by-advertisement
proceedings. A sheriff’s sale was held on September 19, 2013, and the Trustee purchased the
Property for $270,819.17. (Dkt. 10-3, Sheriff’s Deed.) The redemption period was set to expire
on March 19, 2014. (Id.) Bell became aware of the foreclosure and Sheriff’s sale on or about
February 27, 2014. (Compl. at ¶ 6.) Concerned about his interactions with the Trustee and
desiring to preserve his alleged rights under the lease, he filed this suit.
Bell attached his lease to his Complaint. (Compl. Ex. 2.) The lease term runs from July
15, 2013 through July 15, 2016. (Compl. at 1.) In the Complaint, Bell alleges that the lease gave
him the option to purchase the Property. (Id. at ¶ 7.) But the terms of the lease documents
attached to the Complaint did not grant Bell this option. (See Compl. Ex. 2.) In any event, Bell
says that he is willing and able to continue paying rent and remain in the Property, or to purchase
the Property outright. (Id. at ¶ 9.) Indeed, he says that the Trustee represented to him that he
could remain in his lease, and that he would be able to purchase the Property if it was not
redeemed. (Id. at ¶ 21.) But he alleges that the Trustee has refused to accept his rental payments
and refuses to acknowledge his option to purchase the Property. (Id. at ¶¶ 15–16.) It is unclear
from the Complaint whether Bell is still residing in the Property or whether the Trustee has
commenced eviction proceedings.

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Bell filed this suit in state court on March 10, 2014. (Compl. at 1.) His Complaint
contains four counts: Quiet Title (Count I); Fraud in the Inducement (Count II); Violation of the
Protecting Tenants at Foreclosure Act (“PTFA”) (Count III); and Intentional Infliction of
Emotional Distress (Count IV). He seeks money damages, and asks the Court to toll the statutory
redemption period and set aside the sheriff’s sale. (Id.) As the only served Defendant, the Trustee
removed the Complaint to this Court on April 11, 2014. (Dkt. 1, Notice of Removal.) After
Defendant filed its answer (Dkt. 3), the parties engaged in some discovery. But then Defendant
filed the present motion for judgment on the pleadings. (Dkt. 10.) Shortly thereafter, the parties
stipulated to a stay of discovery pending resolution of the motion. (Dkt. 15.)
III. ANALYSIS
Bell seeks to protect his rights under the lease by asserting a variety of claims. While the
Court recognizes his concerns, the Court finds that Bell has not stated any claims upon which
relief can be granted. So Defendant’s motion will be granted.
A. Standing
Defendant first argues that Bell lacks standing to challenge the foreclosure, citing both
constitutional and “statutory” standing requirements. (Def.’s Reply at 4–5.) These arguments
largely miss the mark.
Defendant argues that “Plaintiff lacks statutory standing to challenge the completed
foreclosure because the [statutory] redemption period has expired.” (Def.’s Reply Br. at 5.) Not
so. The Sixth Circuit has repeatedly explained that the expiration of the statutory redemption
period does not create a standing issue. See Elsheick v. Select Portfolio Servicing, Inc., 566 F.
App’x 492, 497 (6th Cir. 2014); see also Langley v. Chase Home Finance, LLC, No. 10–604,
2011 U.S. Dist. LEXIS 32845, at *2 n. 2, 2011 WL 1130926 (W.D. Mich. Mar. 28, 2011).

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Instead, it means that Plaintiff must demonstrate “a strong case of fraud or irregularity, or some
peculiar exigency, to warrant setting a foreclosure sale aside’ after the redemption period
expires.” Sweet Air Inv., Inc. v. Kenney, 739 N.W.2d 656, 659 (Mich. Ct. App. 2007) (quoting
United States v. Garno, 974 F.Supp. 628, 633 (E.D. Mich.1997)).
Defendant also argues that Bell lacks constitutional standing in this case because he is not
a signatory to the mortgage. The Court disagrees. The minimum components of constitutional
(Article III) standing are as follows:
First, the plaintiff must have suffered an “injury in fact”—an invasion of a legally
protected interest which is (a) concrete and particularized, and (b) “actual or
imminent, not ‘conjectural’ or ‘hypothetical.’ ” Second, there must be a causal
connection between the injury and the conduct complained of—the injury has to
be “fairly . . . trace[able] to the challenged action of the defendant, and
not . . . th[e] result [of] the independent action of some third party not before the
court.” Third, it must be “likely,” as opposed to merely “speculative,” that the
injury will be redressed by a “favorable decision.”
Zurich Ins. Co. v. Logitrans, Inc., 297 F.3d 528, 531 (6th Cir. 2002) (quoting Kardules v. City of
Columbus, 95 F.3d 1335, 1346 (6th Cir. 1996)); see also Lujan v. Defenders of Wildlife, 504 U.S.
555, 560 (1992). In addition, “a plaintiff must assert his own legal rights and interests, and
cannot rest his claim to relief on the legal rights or interests of third parties.” Coyne v. Am.
Tobacco Co., 183 F.3d 488, 494 (6th Cir. 1999) (citation omitted).
The Court finds that Bell has Article III standing to bring this lawsuit.1 Bell brought suit
in order to protect his right to remain in the Property until the end of the lease term and preserve
his option to purchase the Property under the lease. (See Compl.) Bell has alleged that he has a
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The Court recognizes that at least one court in this district has held that a mere tenant
lacks Article III standing to challenge a mortgage foreclosure proceeding. See Hurst v. Federal
Nat. Mortg. Ass’n, No. 14-10942, 2015 WL 300275, at *3 (Jan. 22, 2015) (collecting cases). But
in Hurst, the tenant did “not allege that she [had] any legally binding instrument that would
establish” a purchase option and did not have a written lease. Id. at *1. Moreover, the cases cited
by the Hurst court are all district court decisions, many from outside this Circuit and based on
the law of other states, and are not binding on this Court.
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possessory interest in the Property due to his lease, as well as an option to purchase the Property
granted to him by its former owner. See United States v. Currency $267,961.07, 916 F.2d 1104,
1107 (6th Cir. 1990) (commenting that a “property interest less than ownership, such as a
possessory interest, is sufficient to create [constitutional] standing” to challenge a judicial
forfeiture proceeding). He states that the Trustee has invaded those interests by refusing to honor
his purchase option. Lastly, his desire to remain in the home would be vindicated by a favorable
decision from this Court.
Defendants cite King v. IB Property Holdings Acquisition, 635 F.Supp.2d 651 (E.D.
Mich. 2009). This case is inapposite. In King, the court considered whether a mortgage holder’s
son could assert claims regarding the mortgage under the Fair Debt Collection Practices Act
(“FDCPA”). Finding that the son was not a “consumer” within the meaning of the FDCPA, the
court concluded that he did not have “standing” to pursue an FDCPA claim on behalf of his
father. Id. at 658–59. This holding does not bear on Article III standing. See Miller v. City of
Cincinnati, 870 F. Supp. 2d 534, 537 (S.D. Ohio 2012) (“[T]he question of statutory standing is
often confused with the question of constitutional and prudential standing. As the Sixth Circuit
has explained, statutory standing is the question of ‘whether this plaintiff has a cause of action
under the statute.” (citing Roberts v. Hamer, 655 F.3d 578, 580–81 (6th Cir. 2011)).
Having disposed of Defendant’s standing arguments, the Court will proceed to the merits.
B. Count I: Quiet Title
In Count I, Bell asks the Court to quiet title in the Property in his name. (Compl. at ¶ 16.)
Defendant correctly notes that, in an unpublished (and therefore non-binding) opinion, the Sixth
Circuit held that “quiet title” is a remedy, rather than a separate cause of action. See Jarbo v.
Bank of New York Mellon, 587 F. App’x 287, 290 (6th Cir. 2014) (“Like a request for an

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injunction or disgorgement, a request for quiet title is only cognizable when paired with some
recognized cause of action.”); see also Goryoka v. Quicken Loan, Inc., 519 F. App’x 926, 929
(6th Cir. 2013). In Michigan, however, “Any person . . . who claims any right in, title to,
equitable title to, interest in, or right to possession of land, may bring an action . . . against any
other person who claims . . . [an inconsistent interest.]” Michigan Compiled Laws § 600.2932(1).
Courts in this district have held that the statute does create a cause of action for quiet title and
have addressed it “in the interest of completeness” even in light of Jarbo and Goryoka. Berry v.
Main St. Bank, 977 F.Supp.2d 766, 776 (E.D. Mich. 2013); see also Gagacki v. Green Tree
Servicing LLC, No. 14-11378, 2015 WL 93476, at *3 n.1 (E.D. Mich. Jan. 7, 2015).
To prevail in an action to quiet title under the Michigan statute, Bell must allege facts
regarding “(a) the interest [he] claims in the premises; (b) the interest the [Defendants] claim[ ]
in the premises; and (c) the facts establishing the superiority of [his] claim.” Trombley v. Seterus
Inc., No. 14-1661, 2015 WL 3620412, at *6 (6th Cir. June 11, 2015). “In an action to quiet title,
the plaintiffs have the burden of proof and must make out a prima facie case of title. If the
plaintiffs make out a prima facie case, the defendants then have the burden of proving superior
right or title in themselves.” Beulah Hoagland Appleton Qualified Pers. Residence Trust v.
Emmet Cnty. Rd. Comm’n, 600 N.W.2d 698, 700 (1999) (citation omitted). “Establishing a prima
facie case of title requires a description of the chain of title through which ownership is
claimed.” Sembly v. U.S. Bank Nat. Ass’n, No. 11-12322, 2012 WL 32737, at *3 (E.D. Mich.
Jan. 6, 2012) aff’d sub nom. Sembly v. U.S. Bank Nat. Ass’n ND, 508 F. App’x 443 (6th Cir.
2012) (citations omitted).
The Court finds that the Complaint fails to state a claim for quiet title. Bell alleges no title
interest in the Property; instead, he cites his lease, his option to purchase, and promises made by

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Defendant that he could still exercise the option to purchase following the sheriff’s sale. (See
Compl. at ¶¶ 7, 16, 21.) He does not allege any conveyance from Hall or the Trustee to himself.
He says that Hall has “superior title interest” to the Trustee (Compl. ¶ 17), but Hall’s “right, title,
and interest in property [were] extinguished upon the expiration of the redemption period.”
Gregory v. CitiMortgage, Inc., 890 F. Supp. 2d 791, 803 (E.D. Mich. 2012). Bell also
acknowledges that the Trustee purchased the Property at the sheriff’s sale. (Compl. ¶ 6.) And yet,
he asserts no fraud or irregularity in the foreclosure itself such that the Court could set it aside.
See Gregory, 890 F. Supp. 2d at 803.
The Court finds that Bell has not stated a claim for quiet title under Michigan Compiled
Laws § 600.2932(1).
C. Count II: Fraud in the Inducement
In Count II, Bell asserts that the Trustee accepted his rent payments while leading him to
believe that he could purchase the Property once the redemption period expired and falsely stated
that some rent adjustments might be warranted. (Compl. ¶¶ 21–22.) Although Bell claims that he
has suffered financial and emotional damages due to his reliance on this alleged representation
(Compl. ¶ 25), he has not alleged when or how Defendant failed to honor it.
“The elements constituting actionable fraud or misrepresentation are well-settled in
Michigan.” Hi-Way Motor Co. v. Int’l Harvester Co., 247 N.W.2d 813, 815 (Mich. 1976).
The general rule is that to constitute actionable fraud it must appear: (1) that
defendant made a material representation; (2) that it was false; (3) that when he
made it he knew that it was false, or made it recklessly, without any knowledge of
its truth and as a positive assertion; (4) that he made it with the intention that it
should be acted upon by plaintiff; (5) that plaintiff acted in reliance upon it; and
(6) that he thereby suffered injury.
Id. Moreover, Federal Rule of Civil Procedure 9(b) provides that “[i]n alleging fraud or mistake,
a party must state with particularity the circumstances constituting fraud or mistake. Malice,
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intent, knowledge, and other conditions of a person’s mind may be alleged generally.” The Sixth
Circuit “interpret[s] Rule 9(b) as requiring plaintiffs to allege the time, place, and content of the
alleged misrepresentation on which he or she relied; the fraudulent scheme; the fraudulent intent
of the defendants; and the injury resulting from the fraud.” Bennett v. MIS Corp., 607 F.3d 1076,
1100 (6th Cir. 2010).
The Complaint does not allege fraud with sufficient particularity. Bell does not say when
he was told that he could still exercise his purchase option or that his rent could be adjusted, nor
does he say who made those statements. Perhaps most importantly, Bell does not say how these
alleged misrepresentations harmed him: he does not state that he has attempted to purchase the
Property, have his payments adjusted, or even that the Trustee has threatened to evict him.
Bell has not stated a claim for fraud. Count II will be dismissed.
D. Count III: Violation of the Protecting Tenants at Foreclosure Act
In Count III, Bell seeks a declaration that he is a “bona fide tenant” within the meaning of
the PTFA and that he is entitled to remain in the property until his lease expires on July 15, 2016.
(Compl. at ¶ 29.) Defendant argues that the PTFA provides no private cause of action. (Def.’s
Br. at 13.)
Congress enacted the PTFA to protect the rights of tenants of foreclosed properties. The
Act imposes certain requirements on successors in interest in foreclosed properties. Specifically,
“bona fide tenants” are to receive at least 90 days’ notice to vacate and be permitted to remain in
the property until the end of their lease term. Protecting Tenants at Foreclosure Act of 2009,
Pub.L. No. 111–22, § 702, 123 Stat. 1632, 1661 (codified at 12 U.S.C. § 5220 note
(Supp.V.2012)). The “objective of these new tenant protections is to ensure that tenants receive
appropriate notice of foreclosure and are not abruptly displaced.” Protecting Tenants at

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Foreclosure: Notice of Responsibilities Placed on Immediate Successors in Interest Pursuant to
Foreclosure of Residential Property, 74 F.R. 30106-02. “The PTFA was intended to allow
tenants who are victims of the foreclosing crisis a protection that can be used in the state courts
to combat unlawful evictions.” Nativi v. Deutsche Bank Nat. Trust Co., No. 09-06096 PVT, 2010
WL 2179885, at *3 (N.D. Cal. May 26, 2010) (citing 155 Cong. Rec. S5111 (daily ed. May 5,
2009) (statement of Sen. Kerry)).
The Sixth Circuit has held that the PTFA “does not provide an express or implied private
right of action.” Mik v. Fed. Home Loan Mtg. Corp., 743 F.3d 149, 160 (6th Cir. 2014). And the
fact that Bell seeks a declaratory judgment pursuant to 28 U.S.C. § 2201 does not save this count
from dismissal. The Declaratory Judgment Act “create[s] a remedy for a preexisting right
enforceable in federal court. It does not provide ‘an independent basis for federal subject matter
jurisdiction.’ Such an independent source of rights exists when . . . a private right of action
authorizes the party to seek ‘an immediately enforceable remedy like money damages or an
injunction.’” Michigan Corr. Org. v. Michigan Dep’t of Corr., 774 F.3d 895, 902 (6th Cir. 2014)
(citing Toledo v. Jackson, 485 F.3d 836, 839 (6th Cir. 2007); Skelly Oil Co. v. Phillips Petroleum
Co., 339 U.S. 667, 671–72 (1950)).
Count III will be dismissed. See id. at 907 (“No private right of action means no
underlying lawsuit. No underlying lawsuit means no jurisdiction. And no jurisdiction means no
declaratory relief.”).
E. Count IV: Intentional Infliction of Emotional Distress
In his response brief, Bell states that he is “willing to concede as to the dismissal of the
Intentional Emotional Distress claim from this lawsuit.” (Pl.’s Resp. at 11.) Therefore, Count IV
will be dismissed.

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F. Plaintiff’s Motion to Amend
In his response brief, Bell asks that “if more particularity is requested by the Court,” he
be given “leave to amend pursuant to Rule 15(a)(2).” (Pl.’s Resp. Br. at 5.) This request does not
comply with several of the Court’s directives regarding motion practice. First, the Court’s
Electronic Filing Policies and Procedures state that “a response or reply to a motion must not be
combined with a counter-motion. Papers filed in violation of this rule will be stricken.” E.D.
Mich. Local Rules App’x ECF R. 5(e). Second, the Court’s Local Rules direct that “[a] party
who moves to amend a pleading shall attach the proposed amended pleading to the motion.” E.D.
Mich. LR 15.1. Moreover, while Federal Rule of Civil Procedure 15 establishes a liberal policy
toward granting leave to amend, a “request for leave to amend almost as an aside, to the district
court in a memorandum in opposition to the defendant’s motion to dismiss is . . . not a motion to
amend.” Kuyat v. BioMimetic Therapeutics, Inc., 747 F.3d 435, 444 (6th Cir. 2014) (quoting La.
Sch. Emps.’ Ret. Sys. v. Ernst & Young, LLP, 622 F.3d 471, 486 (6th Cir. 2010)).
IV. CONCLUSION
For the reasons set forth above, the Trustee’s Motion for Judgment on the Pleadings (Dkt.
10) is GRANTED. Plaintiff’s Motion to Amend the Complaint, set forth in his response brief, is
DENIED. The claims against the Trustee are DISMISSED. A separate order regarding the status
of Defendant Dorothy Cameron-Hall will follow.
IT IS SO ORDERED.
s/Laurie J. Michelson
LAURIE J. MICHELSON
UNITED STATES DISTRICT JUDGE
Dated: July 31, 2015

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CERTIFICATE OF SERVICE
The undersigned certifies that a copy of the foregoing document was served on the attorneys
and/or parties of record by electronic means or U.S. Mail on July 31, 2015.
s/Jane Johnson
Case Manager to
Honorable Laurie J. Michelson

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