Butterfield v. Deutsche Bank National Trust Company, Trustee

Filing 18

///ORDER granting 14 Motion to Dismiss for Failure to State a Claim. So Ordered by Judge Paul J. Barbadoro.(vln)

UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEW HAMPSHIRE
Richard Butterfield
v.

Civil No. 16-cv-348-PB
Opinion No. 2017 DNH 054

Deutsche Bank National Trust
MEMORANDUM AND ORDER
Richard Butterfield filed this action in an attempt to undo
a foreclosure sale on a property he once owned in Rochester, New
Hampshire.

He has sued Deutsche Bank National Trust Company in

its capacity as trustee for the trust that currently owns the
property.

He seeks both damages and injunctive relief and

asserts claims for wrongful foreclosure, breach of contract, and
lack of power and authority to foreclose.
Deutsche Bank has filed a motion to dismiss for failure to
state a claim.

I.

BACKGROUND1

Butterfield took title to a residential property located at

I draw the facts from the amended complaint (doc. no. 11) and
documents referenced in the pleadings that a court may consider
when ruling on a motion to dismiss. See Plumbers' Union Local
No. 12 Pension Fund v. Nomura Asset Acceptance Corp., 632 F.3d
762, 771 (1st Cir. 2011). The facts are construed in the light
most favorable to Butterfield. Id.
1

9 Norman Street in Rochester, New Hampshire on February 23, 2001.
On February 13, 2007, he refinanced his mortgage with a loan
from Chase Bank, USA.

On or about March 6, 2013, Chase assigned

the mortgage to Deutsche Bank as trustee for the J.P. Morgan
Trust 2007-CH5, Asset Backed Pass-Through Certificates, Series
2007-CH5 trust.
Deutsche Bank foreclosed on the property on December 1,
2015.

It filed a foreclosure deed on February 26, 2016.

An

affidavit was filed with the foreclosure deed as is required by
N.H. Rev. Stat. Ann. § 479:26.
affidavit asserts that:

Among other things, the

(1) Butterfield failed to make payments

required under the mortgage; (2) timely notice of the
foreclosure sale was sent by certified mail to Butterfield's
home address; (3) the original foreclosure sale was continued by
public proclamation until December 1, 2015; and (4) the property
was sold to Deutsche Bank at auction as the highest bidder on
December 1, 2015.

Although notice of the foreclosure sale was

sent to Butterfield by certified mail, he did not receive it.
Butterfield asserts three claims for relief.

Count I,

which is styled as a claim for wrongful foreclosure, contends
that the foreclosure sale is void because Butterfield did not
receive the advance notice of the impending foreclosure that is
required by N.H. Rev. Stat. Ann. § 479:25 ("RSA 479:25).
2

Count

II alleges that Deutsche Bank is liable for breach of contract
because it failed to comply with the notice of default
requirements described in paragraph 22 of the mortgage.

Count

III asserts that Deutsche Bank lacked the power to foreclose
because Chase's assignments of the note and mortgage were
improper.

Deutsche Bank argues in its motion to dismiss that

Count I fails to state a claim for relief and that the remaining
claims are barred by RSA 479:25 because they were not brought
prior to the foreclosure sale.
When a lender seeks to foreclose a mortgage pursuant to a
power of sale in New Hampshire, it must satisfy the publication
and notice requirements of RSA 479:25.

If the lender satisfies

these requirements, the borrower ordinarily loses the right to
challenge the validity of the foreclosure sale unless he files a
petition to enjoin the foreclosure sale before it occurs.

Id.

Butterfield claims in Count I that the foreclosure sale is
void because he did not receive "personal notice" of the
foreclosure.

This argument is based on a misreading of RSA

479:25, which permits a lender to notify a borrower of a
foreclosure sale either by serving the foreclosure notice on the
borrower or by sending the notice to the borrower's last known
address.

As the New Hampshire Supreme Court has recognized, the

statute does not entitle a borrower to actual notice of the
3

foreclosure sale.

See Dugan v. Manchester Fed. Sav. & Loan

Ass'n, 92 N.H. 44 (1942) (construing P.L. Ch. 215 § 23).2
Butterfield does not claim that Deutsche Bank failed to send him
the notice required by the statute and he does not challenge
Deutsche Bank's contention in the affidavit it filed with the
foreclosure deed pursuant to N.H. Rev. State. Ann. § 479:26 that
proper notice was sent.

Accordingly, Count I of the amended

complaint fails to state a viable claim for relief.
Counts II and III of the Amended Complaint challenge the
validity of the foreclosure process.

Because these claims were

not brought prior to the foreclosure sale, they are barred by
RSA 479:25.3

See The Bank of New York Mellon as Trustee v.

Dowgiert, 145 A.2d 138, 142 (N.H. 2016).

Butterfield's reliance on Snyder v. New Hampshire Sav. Bank,
134 N.H. 32, 37 (1991) is misplaced. Snyder merely recognizes
that an owner of a mortgaged premises is entitled to the notice
required by the statute. The term "personal notice" is used in
the opinion merely to distinguish notice by service or mail,
which an owner is entitled to, from the general notice of a
foreclosure that is provided through publication. The opinion
does not hold that a foreclosure notice is invalid unless it is
received.
2

A borrower's breach of fiduciary duty claim for damages need
not be brought prior to the foreclosure sale. Dugan, 92 N.H. at
44. Butterfield, however, does not present a breach of
fiduciary duty claim.
3

4

Deutsche Bank's motion to dismiss (doc. no. 14) is granted.
SO ORDERED.
/s/Paul Barbadoro
Paul Barbadoro
United States District Judge
March 21, 2017
cc:

Stephen T. Martin, Esq.
William P. Breen, Esq.

5