TD Bank, N.A. v. Charles Watkins Automobiles, Inc. et al
ORDER granting in part and denying in part 10 Motion to Dismiss or in the Alternative to Stay; accepting 16 Memorandum and Recommendation; and rejecting Plaintiff's 17 Objections thereto. The Court ABSTAINS from proceeding in this matter, and this case is hereby STAYED pending further order of the Court. Signed by District Judge Martin Reidinger on 2/1/2016. (khm)
IN THE UNITED STATES DISTRICT COURT
FOR THE WESTERN DISTRICT OF NORTH CAROLINA
CIVIL CASE NO. 1:14-cv-322-MR-DSC
TD BANK, N.A,
CHARLES WATKINS AUTOMOBILES, )
INC., CHARLES T. WATKINS, and
JACKIE R. WATKINS,
THIS MATTER is before the Court on the Defendants’ Motion to
Dismiss or in the Alternative to Stay [Doc. 10], the Magistrate Judge’s
Memorandum and Recommendation (“M&R”) suggesting that the Court stay
this case [Doc. 16], and the Plaintiff’s Objections to the Magistrate Judge’s
M&R. [Doc. 17].
Pursuant to 28 U.S.C. § 636(b) and a specific Order of referral of the
District Court, the Honorable David S. Cayer, United States Magistrate
Judge, was designated to conduct pretrial proceedings in the abovecaptioned matter and to submit to this Court recommendations regarding any
dispositive action to be taken.
This matter is a debt collection action brought by Plaintiff to recover
money it claims it is owed by the Defendants following their alleged default
on two promissory notes and corresponding modification, forbearance,
extension, and guaranty agreements. [Doc. 1 at 12-13]. Prior to filing this
action, Plaintiff initiated three non-judicial foreclosure proceedings before the
Rutherford County, North Carolina, Clerk of Superior Court, to sell collateral
used to secure Defendants’ debts owed to Plaintiff. [Doc. 14-1 at 1].
Defendants herein, together with non-party Church Street Station, LLC,
thereafter filed a complaint and motion for preliminary injunction in the
Rutherford County, North Carolina, Superior Court. [Id.]. The Defendants’
complaint alleges state law claims and equitable defenses to foreclosure
against TD Bank and two of its representatives for breach of duty of good
faith and fair dealing, fraud, negligent misrepresentation, breach of contract,
breach of duty of confidentiality, unfair and deceptive acts and practices, and
prima facie tort arising from acts and misrepresentations in connection with
the Defendants’ loans and all other written agreements with TD Bank entered
into after July of 2007. [Id. at 2]. The Defendants’ motion for preliminary
injunction seeks to enjoin the sale of the collateral at issue in the three
foreclosure proceedings. [Id. at 3-5].
As the basis for their state court complaint and injunction, Defendants
allege that TD Bank entered into the loans, deeds of trust and other written
agreements with Mr. Watkins during a time in which he lacked the necessary
mental capacity required to enter into enforceable contracts or agreements.
[Doc. 22 at 6-7].
The state court has entered a preliminary injunction
enjoining the respective trustees from proceeding further with the three
foreclosure actions. [Id.].
On June 22, 2015, the Magistrate Judge filed his M&R in this case
analyzing whether the Court should proceed to entertain this matter or
abstain and allow the state court action to continue uninterrupted. [Doc. 16].
The Magistrate Judge recommended that the Court abstain from hearing this
case and stay the same pending the resolution of the parallel state action.
[Id. at 6-7]. The parties were advised by the Magistrate Judge that any
objections to his M&R were to be filed in writing within fourteen days of
service. [Id. at 7]. The Plaintiff timely filed its Objections on July 6, 2015.
After careful, de novo review and thorough consideration of the
Magistrate Judge’s M&R [Doc. 16] and the Plaintiff’s Objections thereto [Doc.
17], the Court concludes that the Magistrate Judge’s legal analysis is
consistent with applicable case law. Accordingly, the Court hereby overrules
IT IS, THEREFORE, ORDERED that: the Magistrate Judge’s
Memorandum and Recommendation [Doc. 16] is ACCEPTED; the Plaintiff’s
Objections thereto [Doc. 17] are REJECTED; the Defendants’ Motion to
Dismiss or in the Alternative to Stay [Doc. 10] is GRANTED in part and
DENIED in part; the Court ABSTAINS from proceeding in this matter; and,
this case is hereby STAYED pending further order of the Court.
IT IS SO ORDERED.
Signed: February 1, 2016
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