Lucido et al v. U.S. Bank National Association, as trustee for MASTR ADJUSTABLE RATE MORTGAGES, TRUST 2006-0A1, MORTGAGE PASS THROUGH CERTIFICATES SERIES 2006-0A1 as assignee

Filing 14

OPINION AND ORDER Granting Defendant's 3 Motion to Dismiss and Dismissing Complaint with Prejudice. Signed by District Judge David M. Lawson. (SPin)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MICHIGAN
SOUTHERN DIVISION
SEBASTIAN LUCIDO, and
KRIS LUCIDO,
Plaintiffs,
v.

Case Number 15-13697
Honorable David M. Lawson

U.S. BANK NATIONAL ASSOCIATION,
as trustee for MASTR ADJUSTABLE RATE
MORTGAGES, TRUST 2006-0A1,
MORTGAGE PASS THROUGH
CERTIFICATES SERIES 2006-0A1 as assignee,
Defendant.
_________________________________________/
OPINION AND ORDER GRANTING DEFENDANT’S MOTION TO DISMISS
AND DISMISSING COMPLAINT WITH PREJUDICE
Plaintiffs Sebastian and Kris Lucido filed the present action in an attempt to set aside the
sheriff sale on their home in Rochester, Michigan valued at $1,650,000. They identified eight claims
in their complaint, pleaded in separate counts. The disputes center on whether defendant U.S. Bank
National Association posted the notice of the foreclosure by advertisement in a conspicuous place
on the plaintiffs’ property, and an alleged promise not to go forward on the sheriff’s sale while a
loan modification was being considered. The case is now before the Court on the defendant’s
motion to dismiss. The Court heard oral argument on February 3, 2016. Because the complaint
makes only vague allegations, and to the extent any arguments are made, they are foreclosed by law,
the plaintiffs have not stated any claim upon which relief can be granted. Therefore, the Court will
grant the defendant’s motion and dismiss the complaint.

I.
The complaint states very few facts. From what has been pleaded, and from the public
record exhibits attached the defendant’s motion to dismiss, it appears that the plaintiffs’ home is
located at 5404 Barrington in the City of Rochester, Oakland County, Michigan (the property). On
January 9, 2006, the plaintiffs received a loan from non-party American Home Mortgage
Acceptance, Inc. for $1,650,000. To secure repayment of the loan, the plaintiff granted a mortgage
on the property to Mortgage Electronic Registration Systems, Inc. (MERS), solely as nominee for
lender and lender’s successors and assigns. MERS, and the successors and assigns of MERS are
named as the mortgagee; the mortgage was recorded on April 11, 2006. On November 1, 2012,
MERS assigned the mortgage to defendant U.S. Bank, N.A., as trustee for MASTR Adjustable Rate
Mortgages, Trust 2006-0A1, Mortgage Pass Through Certificates Series 2006-0A1.

That

assignment was recorded on November 21, 2012.
The plaintiffs defaulted on their obligations under the loan at some point before the fall of
2014. They allege that the defendant promised to consider them for a loan modification or financial
accommodation between the fall of 2014 and the sheriff’s sale, which occurred on March 17, 2015.
However, no modification agreement was consummated or even signed, and the defendant continued
with the foreclosure by advertisement.
The plaintiffs contend that the foreclosure was defective because the defendant did not post
a foreclosure notice on the property within the 15-day statutory time frame. The plaintiffs allege
that the defendant intentionally did not post the notice of foreclosure in order to prevent the plaintiffs
from entering into a loan modification. The sheriff’s deed, however, contains two notarized
affidavits averring that the foreclosure was published in the Oakland County Legal News beginning

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on February 12, 2015 for four successive weeks, and that the notice was annexed to the property in
a conspicuous place nine days later.
The plaintiffs also allege that the defendant promised to engage in the loan modification
process, but then somehow used that process to deceive the plaintiffs and foreclose on their home.
The complaint does not elaborate on how that was done.
The defendant purchased the property at the sheriff’s sale on March 17, 2015. The
redemption period expired on September 17, 2015. The plaintiffs filed their complaint in state court
on September 21, 2015. It was signed by the plaintiffs’ attorney on September 18, 2015, the day
after the redemption period ended. The complaint identifies eight counts: (1) quiet title; (2) breach
of Michigan Compiled Laws § 600.3208; (3) breach of an implied agreement/specific performance;
(4) innocent/negligent misrepresentation; (5) promissory estoppel; (6) unjust enrichment; (7) unfair
trade practice; and (8) injunction and other relief. With their complaint, the plaintiffs filed an ex
parte motion for a temporary restraining order to stay and toll the expiration of the redemption
period. The state court judge denied the plaintiffs’ motion that same day. The defendant properly
removed this action on October 20, 2015 and filed its motion to dismiss a week later.
II.
The defendant’s motion is brought under Federal Rule of Civil Procedure 12(b)(6). “The
purpose of Rule 12(b)(6) is to allow a defendant to test whether, as a matter of law, the plaintiff is
entitled to legal relief if all the facts and allegations in the complaint are taken as true.” Rippy ex rel.
Rippy v. Hattaway, 270 F.3d 416, 419 (6th Cir. 2001) (citing Mayer v. Mylod, 988 F.2d 635, 638
(6th Cir. 1993)). Under Rule 12(b)(6), the complaint is viewed in the light most favorable to the
plaintiff, the allegations in the complaint are accepted as true, and all reasonable inferences are

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drawn in favor of the plaintiff. Bassett v. Nat’l Collegiate Athletic Ass’n, 528 F.3d 426, 430 (6th
Cir. 2008). “However, while liberal, this standard of review does require more than the bare
assertion of legal conclusions.” Columbia Nat’l Res., Inc. v. Tatum, 58 F.3d 1101, 1109 (6th Cir.
1995); Tackett v. M & G Polymers, USA, L.L.C., 561 F.3d 478, 488 (6th Cir. 2009). “To survive
a motion to dismiss, [a plaintiff] must plead ‘enough factual matter’ that, when taken as true,
‘state[s] a claim to relief that is plausible on its face.’ Bell Atl. Corp. v. Twombly, 550 U.S. 544, 556,
570 (2007). Plausibility requires showing more than the ‘sheer possibility’ of relief but less than
a ‘probab[le]’ entitlement to relief. Ashcroft v. Iqbal, [556 U.S. 662, 678] (2009).” Fabian v.
Fulmer Helmets, Inc., 628 F.3d 278, 280 (6th Cir. 2010). “Where a complaint pleads facts that are
‘merely consistent with’ a defendant’s liability, it ‘stops short of the line between possibility and
plausibility of entitlement to relief.’” Iqbal, 556 U.S. at 678 (quoting Twombly, 550 U.S. at 557).
Under the new regime ushered in by Twombly and Iqbal, pleaded facts must be accepted by
the reviewing court but conclusions may not be accepted unless they are plausibly supported by the
pleaded facts. “[B]are assertions,” such as those that “amount to nothing more than a ‘formulaic
recitation of the elements’” of a claim, can provide context to the factual allegations, but are
insufficient to state a claim for relief and must be disregarded. Iqbal, 556 U.S. at 681 (quoting
Twombly, 550 U.S. at 555). However, as long as a court can “‘draw the reasonable inference that
the defendant is liable for the misconduct alleged,’ a plaintiff’s claims must survive a motion to
dismiss.” Fabian, 628 F.3d at 281 (quoting Iqbal, 556 U.S. at 678).
Consideration of a motion to dismiss under Rule 12(b)(6) is confined to the pleadings. Jones
v. City of Cincinnati, 521 F.3d 555, 562 (6th Cir. 2008). Assessment of the facial sufficiency of the
complaint ordinarily must be undertaken without resort to matters outside the pleadings. Wysocki

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v. Int’l Bus. Mach. Corp., 607 F.3d 1102, 1104 (6th Cir. 2010). However, “documents attached to
the pleadings become part of the pleadings and may be considered on a motion to dismiss.”
Commercial Money Ctr., Inc. v. Illinois Union Ins. Co., 508 F.3d 327, 335 (6th Cir. 2007) (citing
Fed. R. Civ. P. 10(c)); see also Koubriti v. Convertino, 593 F.3d 459, 463 n.1 (6th Cir. 2010). Even
if a document is not attached to a complaint or answer, “when a document is referred to in the
pleadings and is integral to the claims, it may be considered without converting a motion to dismiss
into one for summary judgment.” Commercial Money Ctr., 508 F.3d at 335-36. If the plaintiff does
not directly refer to a document in the pleadings, but that document governs the plaintiff’s rights and
is necessarily incorporated by reference, then the motion need not be converted to one for summary
judgment. Weiner v. Klais & Co., Inc., 108 F.3d 86, 89 (6th Cir. 1997) (holding that plan documents
could be considered without converting the motion to one for summary judgment even though the
complaint referred only to the “plan” and not its associated documents). In addition, “a court may
consider matters of public record in deciding a motion to dismiss without converting the motion to
one for summary judgment.” Northville Downs v. Granholm, 622 F.3d 579, 586 (6th Cir. 2010)
(citing Commercial Money Ctr., Inc., 508 F.3d at 335-36).
A.
The defendant argues that the plaintiffs’ claims for quiet title (Count I) and breach of
Michigan Compiled Laws § 600.3208 (Count II) fail because the plaintiffs have not identified any
error in the foreclosure sale process or noncompliance with the statute. And even if there are defects
in the foreclosure procedure, the defendant argues, the sheriff’s sale is merely voidable rather than
void. The defendant cite Kim v. JP Morgan Chase Bank, N.A., 493 Mich. 98, 116, 825 N.W.2d 329,
336 (2012), in support, which requires that to obtain relief from a voidable sheriff’s deed, a plaintiff

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must show that he was prejudiced by the failure to comply with the foreclosure proceeding and show
that he would have been in a better position to preserve their interest in the property. The defendant
argues that the plaintiffs have not been prejudiced nor have they alleged any prejudice in the
complaint.
The plaintiffs respond that the redemption period should be tolled because Michigan law
allows an equitable extension of the period with a showing of fraud or irregularity in the foreclosure
sale, citing Schulthieis v. Barron, 16 Mich. App. 246, 247-48; 167 NW2d 784 (1969)). The
plaintiffs also insist that they have standing to make a quiet title claim, even though the defendant
did not challenge standing. After explaining that they can bring the quiet title claim, the totality of
their argument is as follows: “More importantly, as it relates to the redemption period issue,
Plaintiffs have argued that the manner in which the foreclosure was handled and how the failure to
comply with the Financial Accommodation requirements violated MCL §600.3204.”
Foreclosure sales by advertisement are governed by statute. Senters v. Ottawa Sav. Bank,
FSB, 443 Mich. 45, 50, 503 N.W.2d 639, 641 (1993). “Once the mortgagee elects to foreclose a
mortgage by this method, the statute governs the prerequisites of the sale, notice of foreclosure and
publication, mechanisms of the sale, and redemption.” Ibid. (citing Mich. Comp. Laws § 600.3201).
Section 600.3204 provides that a party may foreclose a mortgage by advertisement if several
circumstances exist, none of which have been identified by the plaintiffs as being absent in this case.
The “Financial Accommodation requirements” to which the plaintiffs make reference were
found in Michigan Compiled Laws § 600.3204(4), which prohibited a mortgagee from starting to
foreclose on a property unless the mortgagee had mailed notice to the mortgagor, and either the
mortgagor had requested a housing counselor meeting and the parties had completed their meeting,

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or the time for a mortgagor to request a housing counselor meeting had expired. However,
subsection 4 of the statute was deleted effective June 19, 2014. 2014 Mich. Pub. Acts 125 p. 1. The
only allegations in the complaint that relate to the timing of the foreclosure events state that there
were communications between the parties starting in the fall of 2014. Such communications
occurred after the statute was amended and the bank’s financial accommodation obligation was
eliminated.
To prevail in a quiet title action under Michigan law, the plaintiffs first “must make out a
prima facie case of title.” Beulah Hoagland Appleton Qualified Pers. Residence Trust v. Emmet Cty.
Rd. Comm’n, 236 Mich. App. 546, 550, 600 N.W.2d 698, 700 (1999). If the plaintiffs can carry this
burden, the defendant must then prove superior right or title. Ibid. Here, the plaintiffs’ claim for
quite title fails because the defendant has superior title. The plaintiffs concede that they did not
redeem the property, but they argue that they filed this lawsuit before the expiration of the
redemption period. The plaintiffs are mistaken. The redemption period ended on September 17,
2015. The plaintiffs’ state court complaint was filed four days later on September 21, 2015. Indeed,
the plaintiffs’ attorney signed the summons and complaint on September 18, 2015 before filing it
with the circuit court. Nonetheless, the plaintiffs falsely allege that they filed this suit before the end
of the redemption period. They did not.
The plaintiffs claim title through a warranty deed, but the defendant has a later-dated
sheriff’s deed. “[A]fter a sheriff’s sale is completed, a mortgagor may redeem the property by
paying the requisite amount within the prescribed time limit, which here was six months.” Bryan
v. JPMorgan Chase Bank, 304 Mich. App. 708, 713, 848 N.W.2d 482, 485 (2014). “If a mortgagor
fails to avail him or herself of the right of redemption, all the mortgagor’s rights in and to the

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property are extinguished.” Ibid. Therefore, the later-dated sheriff’s deed in this case is evidence
of superior title to the property, and the plaintiffs have not argued or produced any evidence to the
contrary. See Mich. Comp. Laws § 600.3236.
There is a limited exception to the rule that a mortgagor who fails to redeem timely loses all
rights to the property: the foreclosure might still be voidable if the mortgagor can make a clear
showing that he or she was prejudiced by “fraud” or “irregularity” in the foreclosure procedure
itself. Schulthies v. Barron, 16 Mich. App. 246, 247-48, 167 N.W.2d 656 (2007); see also Sweet
Air Investment, Inc., v. Kenney, 275 Mich. App. 492, 497, 729 N.W.2d 656 (2007) (observing that
“[t]he Michigan Supreme Court has held that it would require a strong case of fraud or irregularity,
or some peculiar exigency, to warrant setting a foreclosure sale aside”) (quoting United States v.
Garno, 974 F. Supp. 628, 633 (E.D. Mich. 1997)). To establish prejudice, the mortgagors must
show “that they would have been in a better position to preserve their interest in the property absent
defendant’s noncompliance with the statute.” Kim v. JPMorgan Chase Bank, N.A., 493 Mich. 98,
116, 825 N.W.2d 329, 337 (2012); see also Conlin v. Mortgage Elec. Registration Sys., Inc., 714
F.3d 355, 361 (6th Cir. 2013). This showing can be made by demonstrating an ability to redeem the
property. Olson v. Merrill Lynch Credit Corp., 576 Fed. Appx. 506, 512 (6th Cir. 2014) (A
mortgagor “has not plausibly alleged such prejudice” if “she has not alleged that she qualified for
loan modification before the sheriff’s sale.”).
As discussed below, the plaintiffs have not made a strong case of fraud or some other
irregularity sufficient to warrant the setting aside of the sheriff’s sale. And the plaintiffs have not
shown that they have been prejudiced by the alleged notice defect. The plaintiffs contend that it has
become impossible to obtain mortgage financing because of the foreclosure, but they fail to allege

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any attempt to obtain financing or how the foreclosure was the cause of not obtaining a new
mortgage. Therefore, the plaintiffs have not alleged facts that tend to show prejudice, and they have
failed to plead a claim for quiet title for which relief can be granted.
B.
The plaintiffs allege that the defendant did not comply with Michigan foreclosure law
because it may have failed to publish a foreclosure notification in a newspaper and it failed to post
notice of the foreclosure proceedings in a conspicuous place on the property. Under Michigan law,
a notice of the foreclosure “shall be given by publishing the same for 4 successive weeks at least
once in each week, in a newspaper published in the county where the premises included in the
mortgage.” Mich. Comp. Laws § 600.3208. Additionally, within fifteen days of the first publication
of the notice, a copy of such notice “shall be posted in a conspicuous place upon any part of the
premises described in the notice.” Ibid.
Contrary to the plaintiffs’ allegations, the sheriff’s deed includes evidence that the
notification requirements were met. Two notarized affidavits state that the foreclosure was
published in the Oakland County Legal News beginning on February 12, 2015 for four successive
weeks and that the notice was annexed to the property in a conspicuous place nine days later. The
plaintiffs attach the sheriff’s deed to their brief, but omit pages three through six, which include the
affidavits. The Court may consider “documents attached to the pleadings [as] part of the pleadings,”
Commercial Money Ctr., 508 F.3d at 335, as well as “public record[s] in deciding a motion to
dismiss without converting the motion to one for summary judgment.” Northville Downs, 622 F.3d
at 586. The complaint refers to the sheriff’s deed as Exhibit 2 and the plaintiffs provide the exhibit
in their response brief. Therefore, the Court may consider the sheriff’s deed in determining the Rule

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12(b)(6) motion, which demonstrates that the defendant met its notification obligations under
Michigan law.
Even if the plaintiffs’ allegation satisfies their pleading obligation on that score, as stated
above, the plaintiffs have not alleged that they were prejudiced by the alleged failure to post the
notice. Kim, 493 Mich. at 116, 825 N.W.2d at 337; Conlin v. Mortgage Elec. Registration Sys., Inc.,
714 F.3d 355, 361–62 (6th Cir. 2013). Therefore, the plaintiffs have failed to state a claim in Count
II for which relief can be granted.
C.
The plaintiffs’ claims for breach of implied agreement/specific performance (Count III),
innocent/negligent misrepresentation (Count IV), and promissory estoppel (Count V) all are barred
by the Michigan Statute of Frauds. The plaintiffs argue that the defendant promised to forego
foreclosure proceedings while a loan modification was being considered. But a section of the
Michigan Statute of Frauds bars any legal action to enforce certain promises made by a bank unless
the promise is made in writing and signed by an authorized person. As the statute states:
An action shall not be brought against a financial institution to enforce any of the
following promises or commitments of the financial institution unless the promise
or commitment is in writing and signed with an authorized signature by the financial
institution:
(a)
A promise or commitment to lend money, grant or extend credit, or
make any other financial accommodation.
(b)
A promise or commitment to renew, extend, modify, or permit a
delay in repayment or performance of a loan, extension of credit, or
other financial accommodation.
(c)
A promise or commitment to waive a provision of a loan, extension
of credit, or other financial accommodation.
Mich. Comp. Laws § 566.132(2). “This language is unambiguous. It plainly states that a party is
precluded from bringing a claim — no matter its label — against a financial institution to enforce

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the terms of an oral promise to waive a loan provision.” Crown Tech. Park v. D&N Bank, FSB, 242
Mich. App. 538, 550, 619 N.W.2d 66, 72 (2000).
The statute defines the term “financial institution” to include “a state or national chartered
bank.” Mich. Comp. Laws § 566.132(3). “The statute of frauds [imposes] an unqualified and broad
ban.” Crown Tech. Park v. D&N Bank, FSB, 242 Mich. App. 538, 550, 619 N.W.2d 66, 72 (2000).
“[A]n agreement to delay a foreclosure sale is an agreement to make a ‘financial accommodation’
within the scope of [Mich. Comp. Laws § 566.132(2)(a)].” Crenshaw v. Wells Fargo, N.A., No. 1212768, 2012 WL 3156572, at *4 (E.D. Mich. Aug. 3, 2012) (quoting FEI Co. v. Republic Bank, S.E.,
No. 268700, 2006 WL 2313612, at *2 (Mich. Ct. App. Aug. 10, 2006)).
The defendant, a national chartered bank, is a “financial institution” within the meaning of
Michigan Compiled Laws § 566.132(3), and the plaintiffs do not suggest that any alleged promise
to delay foreclosure proceedings while the plaintiffs sought a loan modification was made in writing.
The complaint and associated documents disclose no evidence of any such promise. Although the
plaintiffs have brought three distinct claims, all three claims target the same alleged conduct by the
defendant: an oral agreement to forego foreclosure while loan modification proceedings occur. Such
an agreement is barred by the specific terms of Michigan’s Statute of Frauds. Crown Tech. Park,
242 Mich. App. at 550, 619 N.W.2d at 72.
D.
Even if the claims were not barred by the statute of frauds, they fail independently.
1.
“[A] contract will be implied only if there is no express contract covering the same subject
matter.” Morris Pumps v. Centerline Piping, Inc., 273 Mich. App. 187, 194, 729 N.W.2d 898, 903

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(2006) (quoting Belle Isle Grill Corp. v. Detroit, 256 Mich. App. 463, 478, 666 N.W.2d 271 (2003)).
The parties’ rights and obligations on the loan are clearly expressed in the promissory note and the
mortgage. Therefore, no alleged implied agreement can be enforced in this case. Because there is
no implied agreement, there can be no specific performance of that agreement. Count III fails to
state a viable claim.
2.
The plaintiffs allege that the defendant “made innocent and/or negligent representations of
material facts by promising or representing that Defendant would modify the Loan or financial
accommodations so that the Plaintiffs could remain in the subject property.” Compl. ¶ 24. The
plaintiffs allege that the representations were false. Id. ¶ 26. Innocent misrepresentation is a
“species of fraudulent misrepresentation.” M&D, Inc. v. W.B. McConkey, 231 Mich. App. 22, 28,
585 N.W.2d 33, 37 (1998).
In Michigan, fraudulent misrepresentation consists of the following elements:
(1) the defendant made a material representation; (2) the representation was false; (3)
when the defendant made the representation, the defendant knew that it was false, or
made it recklessly, without knowledge of its truth as a positive assertion; (4) the
defendant made the representation with the intention that the plaintiff would act upon
it; (5) the plaintiff acted in reliance upon it; and (6) the plaintiff suffered damage.
Howard v. Chase Home Fin., LLC, 555 F. App’x 567, 572 (6th Cir. 2014) (quoting M & D, Inc. v.
W.B. McConkey, 231 Mich. App. 22, 585 N.W.2d 33, 36 (1998). In contrast to fraudulent
misrepresentation, “the essence of an innocent misrepresentation claim is that the plaintiff need not
prove that the defendant knew or should have known that the representation was false.” Roberts v.
Saffell, 280 Mich. App. 397, 405, 760 N.W.2d 715, 720 (2008) aff’d, 483 Mich. 1089, 766 N.W.2d
288 (2009). But the plaintiffs must prove that “an unintendedly false representation was made in

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connection with the making of a contract and that the injury suffered as a consequence of the
misrepresentation inure to the benefit of the party making the misrepresentation.” McConkey, 231
Mich. App. at 28, 585 N.W.2d at 37.
To plead a negligent misrepresentation claim, the plaintiffs must state facts showing that “(1)
the defendant made a material misrepresentation; (2) the representation was false; (3) the defendant
was negligent in making the misrepresentation, i.e., the defendant breached a business or
professional duty of care to provide accurate information to those who employ him; and (4) the
plaintiff suffered damages as a result.” Cleveland Indians Baseball Co., L.P. v. New Hampshire Ins.
Co., 727 F.3d 633, 641 (6th Cir. 2013) (citing Law Offices of Lawrence J. Stockler P.C. v. Rose, 174
Mich. App. 14, 436 N.W.2d 70, 81 (1989)).
In federal court, a party also must state “with particularity” the circumstances constituting
a fraud. Fed. R. Civ. P. 9(b); see also Bennett v. MIS Corp., 607 F.3d 1076, 1100 (6th Cir. 2010).
That means that the complaint must “(1) specify the statements that the plaintiff contends were
fraudulent, (2) identify the speaker, (3) state where and when the statements were made, and (4)
explain why the statements were fraudulent.” Indiana State Dist. Council of Laborers and Hod
Carriers Pension and Welfare Fund v. Omnicare, Inc., 583 F.3d 935, 942–43 (6th Cir. 2009)
(quotation marks and citation omitted).
The plaintiffs have not alleged who made the purportedly fraudulent agreement to delay the
sheriff’s sale, when it happened, or where it occurred, as required by Rule 9(b). The Sixth Circuit
has held that Rule 9(b) applies equally to a claim of negligent misrepresentation under Michigan
law, where that claim is based on a “unified course of fraudulent conduct.” Smith v. Bank of
America Corp., 485 F. App’x 749, 752 (6th Cir. 2012) (quoting Hennigan v. Gen. Elec. Co., 09-

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11912, 2010 WL 3905770, at *14 (E.D. Mich. Sept.29, 2010)). The plaintiffs allegations are
insufficient to support this claim and fail to meet the heightened pleading standards of Rule 9(b),
and therefore Count IV fails to state a claim for relief.
3.
The plaintiffs contend that they relied on the defendant’s representation that they would be
considered for a loan modification or financial accommodation and on Michigan Compiled Laws
§ 600.3205. The plaintiffs argue that they would not have entered into the loan modification process
had they known that the defendant would go forward with the sheriff’s sale. In essence, the
plaintiffs are alleging that the defendant represented that it would delay the sheriff’s sale during the
loan modification process. Section 600.3205 was repealed effective June 19, 2014 and therefore
cannot provide the plaintiffs a basis for relief. 2014 Mich. Pub. Acts 125 p. 5. But even if it were
not repealed, and the claim was not barred by the Statute of Frauds, the plaintiffs could not succeed
on a promissory estoppel claim because “[t]o be sufficient to support an estoppel, a promise must
be definite and clear.” McMath v. Ford Motor Co., 77 Mich. App. 721, 726, 259 N.W.2d 140, 142
(1977). The plaintiffs have not alleged any facts to support this claim other than a promise was
made. They have not identified who made the promise, or any other facts showing that the terms
of the alleged promise were definite and clear. Therefore, the plaintiffs’ count for promissory
estoppel fails to state a claim for relief.
E.
The plaintiffs allege that the defendant knew that the plaintiffs were seeking a loan
modification and therefore it was unjustly enriched by foreclosing on the property. However, the
plaintiffs cannot recover under a theory of unjust enrichment — a quasi-contract theory — because

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a written contract actually governs the parties’ relationship. See Fodale v. Waste Mgmt. of
Michigan, Inc., 271 Mich. App. 11, 36, 718 N.W.2d 827, 841 (2006). Here, the promissory note
establishes the defendant’s right to receive payments from the plaintiffs and the mortgage includes
a power of sale. Therefore, the plaintiffs have not pleaded that the defendant received a benefit to
which it was not entitled.
Under Michigan law, to plead a claim of unjust enrichment, a plaintiff must establish that
the defendant has received and retained a benefit from the plaintiff and inequity has resulted. Ibid.
Michigan courts will then imply a contract to prevent unjust enrichment. Ibid. However, courts will
not imply a contract where there is an express contract governing the same subject matter. Ibid.
There is an express contract governing the contested matter in this case. The parties’ rights and
obligations on the loan are clearly expressed in the promissory note and the mortgage. Moreover,
the complaint is utterly devoid of any factual allegations regarding the purported benefit the
defendant received. The plaintiffs fail to state a viable claim of unjust enrichment.
F.
The defendant argues that the Court should dismiss the plaintiffs’ claim for unfair trade
practice because it is not a cause of action. The defendant is correct. The plaintiffs do not identify
what this cause of action is. In their counter-argument, the plaintiffs make vague allegations
regarding affidavits with procedural defects that were either made without knowledge of the alleged
notice violations in this case, or they were forged. But there are no affidavits attached to the
defendant’s brief, so it is not clear what the plaintiffs are referring to.
As the defendant notes, “Michigan common law has no independent cause of action for a
deceptive act or unfair trade practices.” Dingman v. OneWest Bank, FSB, 859 F. Supp. 2d 912,

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921-22 (E.D. Mich. 2012). Perhaps the plaintiffs are alleging a violation of the Michigan Consumer
Protection Act (MCPA). However, even if the complaint is read generously to plead such a claim,
the MCPA does not apply to “a transaction or conduct specifically authorized under laws
administered by a regulatory board or officer acting under statutory authority of this state of the
United States.” Mich. Comp. Laws § 445.904(1)(a). Michigan courts have held that residential
lending activities of state and federal banks fall under this exception. See Newton v. Bank West, 262
Mich. App. 434, 441, 686 N.W.2d 491, 494 (2004) (noting that “[b]oth Michigan courts and federal
courts applying Michigan law have consistently held that the MCPA does not apply to claims arising
out of residential mortgage loan transactions”). The plaintiffs have not pleaded a cognizable claim
in Count VII of the complaint.
G.
Although styled as a separate count, count VIII is simply a demand for injunctive relief and
alleges no substantial cause of action. Therefore, this claim must be dismissed. See Qadeer v. Bank
of Am., N.A., No. 12-14310, 2013 WL 424776, at *7 (E.D. Mich. Feb. 4, 2013).
III.
The plaintiffs have not pleaded a claim for which relief can be granted because the plaintiffs’
complaint is either completely devoid of detail, the claims are foreclosed by law, or the causes of
action do not exist. On that score, one last point is worth noting. The defendant points out that the
Sixth Circuit recently affirmed the dismissal of a virtually identical complaint filed by plaintiffs’
counsel in another case. See Hall v. U.S. Bank, N.A., 626 F. App’x 114 (6th Cir. 2015). However,
Hall does not stand as precedent — binding or otherwise — with respect to the merits of the present
matter. Indeed, the Hall court declined to reach the merits of the plaintiffs’ claims on appeal

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because counsel’s “appellate brief simply recites — almost verbatim — his response in the district
court in opposition to the motion to dismiss, failing to identify any challenged aspect of the district
court’s ruling.” Id. at 115. The court concluded, therefore, that “he has abandoned his claims.”
Ibid. However, the court also took the time “to note that counsel — not for the first time — has
advanced claims patently lacking in merit.” Id. at 116. And the court cautioned plaintiffs’ counsel:
Just as it is clear that verbatim recitations of district court filings are inadequate on
appeal, counsel should already be equally cognizant of the need to refrain from filing
obviously groundless claims. See, e.g., Fed. R. Civ. P. 11(b)(2) (requiring that
claims “are warranted by existing law or by a nonfrivolous argument for extending,
modifying, or reversing existing law or for establishing new law”); Fed. R. App. P.
38 (providing for sanctions for frivolous appeals); Mich. R. Prof. Conduct 3.1 (“A
lawyer shall not bring . . . a proceeding, or assert . . . an issue therein, unless there
is a basis for doing so that is not frivolous.”). We hope no further prompting will be
necessary.
Id. at 116-17. Based on the complaint filed in this case, it is far from clear that the caution was
heeded. It is enough to hold at present, however, that this case must be dismissed.
Accordingly, it is ORDERED that the defendant’s motion to dismiss [dkt. #3] is
GRANTED.
It is further ORDERED that the complaint is DISMISSED WITH PREJUDICE.
s/David M. Lawson
DAVID M. LAWSON
United States District Judge
Dated: July 11, 2016

PROOF OF SERVICE
The undersigned certifies that a copy of the foregoing order was served
upon each attorney or party of record herein by electronic means or first
class U.S. mail on July 11, 2016.
s/Susan Pinkowski
SUSAN PINKOWSKI

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