Heard v. Fannie Mae, et al

Filing 8

ORDER granting 7 Motion to Dismiss. Signed by District Judge Bernard A. Friedman. (MVer)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MICHIGAN
SOUTHERN DIVISION
PAULETTE HEARD,
Plaintiff,
vs.

Civil Action No. 14-CV-14152
HON. BERNARD A. FRIEDMAN

FEDERAL NATIONAL
MORTGAGE ASSOCIATION,
Defendant.
__________________________/
OPINION AND ORDER GRANTING DEFENDANT’S MOTION TO DISMISS
This matter is presently before the Court on defendant’s motion to dismiss [docket
entry 7]. Plaintiff has not responded to this motion and the time for her to do so has expired.
Pursuant to E.D. Mich. LR 7.1(f)(2), the Court shall decide this motion without a hearing.
This is a “wrongful foreclosure” case. According to documents attached to the
complaint and to defendant’s motion, plaintiff purchased property commonly known as 6517
Snowapple Drive in Clarkston Michigan, in April 2005. Plaintiff granted a mortgage in the property
to CitiMortgage, Inc., in exchange for a mortgage loan. In November 2010 CitiMortgage assigned
the mortgage to defendant Federal National Mortgage Association (“FNMA”). Beginning in July
2011, plaintiff stopped making her monthly payments in full and on time. At some point plaintiff
requested a loan modification, but in December 2013 the loan servicer denied the request.
Foreclosure by advertisement proceedings were commenced, and on April 22, 2014, FNMA
obtained a sheriff’s deed. Plaintiff did not redeem the property and the redemption period expired
on October 22, 2014.
On September 24, 2014, plaintiff commenced the instant action. She alleges that

“Defendants1 have fraudulently allowed Plaintiff to submit several loan modifications,” that “During
each loan modification Defendants would state that they need more documents and/or that they did
not receive said documents,” and that “[d]uring this period, Defendants were starting the foreclosure
process by listing the notice in a newspaper.” Comp. ¶¶ 7, 8, 10. The complaint asserts claims for
wrongful foreclosure, breach of contract, and fraudulent misrepresentation. The first claim is based
on the allegation that defendants “fail[ed] to properly calculate the amount claimed to be due on the
date of the notice of foreclosure.” Id. ¶ 22. The second claim is based on the allegation that
defendants breached a duty of good faith and fair dealing by “[d]isingenuously negotiating loss
mitigation assistance with the Plaintiff” and “[m]isleading Plaintiff about approval and extension
of loss mitigation assistance as an alternative to foreclosure.” Id. ¶ 26. And the third claim is based
on the allegation that defendants induced her “to refrain from defending the [f]orclosure in reliance
on the [r]epresentations made by Defendants.” Id. ¶ 30. For relief plaintiff seeks an order setting
aside the sheriff’s sale, an order granting her a loan modification, and damages.
As the motion is unopposed, the Court shall dismiss the complaint for the reasons
urged by defendant. All of plaintiff’s claims fail because plaintiff has forfeited any right she may
have had to challenge the sheriff’s sale by failing to act “promptly and without delay.” Day Living
Trust v. Kelley, 2013 WL 2459874, at *9 (Mich. App. June 6, 2013). Plaintiff did not file the instant
action until the redemption period had nearly expired. This hardly qualifies as “prompt” action. Nor
has plaintiff made a “clear showing of fraud or irregularity” by the defendant as regards the
foreclosure process, as she must in order to successfully challenge the foreclosure post sheriff’s sale.

1

Plaintiff initially named both CitiMortgage and FNMA as defendants, but subsequently
dismissed her complaint as to CitiMortgage.
2

El-Seblani v. IndyMac Mortgage Servs., 510 F. App’x 425, 428 (6th Cir. 2013). Nor is the equitable
remedy plaintiff seeks (i.e., that the court set aside the sheriff’s sale and deed) available, as her sole
remedy under Michigan’s loan modification statute is to have the foreclosure-by-advertisement
converted to a judicial foreclosure proceeding. See Mich. Comp. Laws § 600.3205c(8).
Further, while plaintiff alleges that “defendants” made various misstatements in
connection with her request for loan modification, by not responding to defendant’s motion to
dismiss she concedes that any such statements were not made by FNMA (the only remaining
defendant in this action) but by a non-party, the loan servicer, Seterus, Inc. Even if statements made
by Seterus could somehow be attributed to FNMA, the allegations of dishonesty and fraud are so
amorphous that no claim for relief is stated. See Fed. R. Civ. P. 9(b). Accordingly,

IT IS ORDERED that defendant’s motion to dismiss is granted.

S/Bernard A. Friedman
BERNARD A. FRIEDMAN
SENIOR UNITED STATES DISTRICT JUDGE
Dated: January 8, 2015
Detroit, Michigan

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