Federal Home Loan Mortgage Corporation v. Dunn et al (TV1)
Filing
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MEMORANDUM OPINION: FHMLC's motion to remand [R. 3 ] is GRANTED, and this action is REMANDED to the General Sessions Court for Knox County, Tennessee. Signed by District Judge Pamela L Reeves on 3/31/15. (JBR) Modified to reflect c/m on 3/31/2015 (JBR).
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF TENNESSEE
AT KNOXVILLE
FEDERAL HOME LOAN MORTGAGE
CORPORATION,
Plaintiff,
v.
APRIL E. DUNN and JIMMY DUNN,
Defendants.
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No.: 3:14-CV-286-PLR-CCS
MEMORANDUM OPINION
Plaintiff, Federal Home Loan Mortgage Corporation (FHLMC), filed this detainer
action on May 14, 2014 in the General Sessions Court for Knox County, Tennessee. On
June 23, 2014, defendant, April Dunn, filed a notice of removal to this court. Thereafter,
FHLMC filed a motion to remand the case, to which April Dunn has responded in
opposition. 1
Because the underlying detainer action involves important state policy
issues, the court will abstain from exercising jurisdiction over the case, and remand the
matter to state court.
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April Dunn filed the Notice of Removal and all related documents in this action. Jimmy Dunn has not entered an
appearance. A show cause order was entered by the court on August 18, 2014, requiring the defendants to show
cause in writing on or before August 28, 2014, why FHMLC’s motion to remand should not be granted and this
action remanded to the General Sessions Court for Knox County, Tennessee. The notice sent to Jimmy Dunn was
returned to the court as undeliverable. Pursuant to Local Rule 7.2 Jimmy Dunn’s failure to respond to the motion
and to the court’s Show Cause Order will be deemed a waiver of any opposition to the relief sought.
I. Background
This action concerns a parcel of real property located at 1203 Gettysvue Way,
Knoxville, Tennessee. April Dunn and Jimmy Dunn were the borrowers on a Deed of
trust secured by the property.
On April 23, 2014, due to default under the loan
documents, the property was sold at a foreclosure sale and assigned to FHMLC. A
Trustee’s Deed was executed conveying the property to FHMLC
On May 14, 2014, FHMLC filed an unlawful detainer action in the General
Sessions Court in Knox County, Tennessee. In the General Sessions case, the amount of
debt requested by FHMLC is specifically stated as “$0,” and FHMLC did not ask for any
further damages or make any claims for rent. In addition, the top of the detainer warrant
specifically states “POSSESSION ONLY.” April Dunn and Jimmy Dunn were named as
parties on the detainer warrant. A hearing on the detainer warrant was scheduled for June
24, 2014, in the General Sessions Court.
On June 23, 2014, April Dunn filed a Notice of Removal. In her Notice of
Removal, Dunn states that this action involves FHMLC’s attempt to deprive her of her
property without due process of law in violation of the Fourteenth Amendment to the
United States Constitution. Dunn alleges that FHMLC violated provisions of the Truth In
Lending Act, the Real Estate Settlement Procedures Act, and the Fair Debt Collection
Practices Act, with respect to the origination, the underwriting, and the servicing of her
loan. In support of her allegations, Dunn states she was never provided notice of the
assignment of her mortgage as required by the Real Estate Settlement Procedures Act,
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nor that her mortgage had been assigned to a mortgage-backed securities pool. She
further alleges that FHMLC failed to timely respond to a Qualified Written Request and
did not provide all of the requested documentation. She further alleges that she was not
provided with the required disclosures at closing, and that her income and expenditures
were not properly verified. FHMLC also failed to satisfy conditions precedent prior to
the unlawful and invalid non-judicial foreclosure of her property.
FHMLC has moved for an order remanding this case to the General Sessions
Court for Knox County, Tennessee. In support of the motion, FHMLC asserts that Dunn
has failed to provide sufficient grounds for removing the case and vesting jurisdiction in
this court. Thus, the matter should be remanded to the General Sessions Court.
FHMLC moves the court to strike Dunn’s opposition brief because it was filed out
of time. In the court’s show cause order, Dunn was directed to respond to FHMLC’s
motion to remand “on or before August 28, 2014.” Dunn failed to meet the August 28
deadline, and instead, filed her brief in opposition to the motion to remand on September
5, 2014, without seeking leave of the court or offering any explanation for the untimely
response.
Dunn is acting pro se in this matter. Despite the filing of her brief beyond the
deadline set in the show cause order, the court will exercise its discretion to consider her
response, finding that FHMLC is not prejudiced by permitting her to file her response out
of time.
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II. Analysis
Federal courts are courts of limited jurisdiction. They possess only that power
authorized by the Constitution and statute, which is not to be expanded by judicial decree.
It is presumed that a cause lies outside this limited jurisdiction, and the burden of
establishing the contrary rests upon the party asserting jurisdiction.
Kokkonen v.
Guardian Life Ins. Co., 511 U.S. 375, 377 (1994). The district court must strictly
construe the removal statute against removal jurisdiction and resolve all doubts as to the
propriety of federal jurisdiction in favor of state court jurisdiction. 28 U.S.C. § 1447(c).
Without deciding whether this action was properly removed under 28 U.S.C. §
1441 and 28 U.S.C. § 1345, the court is persuaded that abstention from exercising
jurisdiction is appropriate in this matter. Federal
courts
may
decline
to
exercise
jurisdiction in “exceptional circumstances.” Quackenbush v. Allstate Ins. Co., 517 U.S.
706, 716 (1996). Abstention involves weighing principles of federalism and comity
against the federal interest in retaining jurisdiction. Id. at 716. Federal courts exercise
discretion to “restrain their authority because of scrupulous regard for the rightful
independence of the state governments and for the smooth working of the federal
judiciary.” Burford v. Sun Oil Co., 319 U.S. 315, 317 (1943).
Under Burford, abstention is appropriate where the action “involves difficult
questions of state law bearing on policy problems of substantial public import,” or where
the exercise of federal review “would be disruptive of state efforts to establish a coherent
policy with respect to a matter of substantial public concern.” Quackenbush, 517 U.S. at
726-27. In particular, the state’s strong interest in pending foreclosure matters warrants
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the application of abstention.
Shaffer v. Heitner, 433 U.S. 186, 207-08 (1977)
(recognizing a state’s “strong interests in assuring the marketability of property within its
borders and in providing a procedure for peaceful resolution of disputes about the
possession of that property).
Even where jurisdiction otherwise exists, courts often abstain from hearing
eviction matters to avoid “completely emasculating the state structure for dealing with
such disputes.”
MCC Mtg. LP v. Office Depot, Inc., 685 F.Supp.2d 939, 946-47
(D.Minn. 2010); see also, Homesales Inc. of Delaware v. Greene, 2010 WL 1630469 at
*2-3 (D.Or. 2010) (stating that because unlawful detainer actions involve a state
regulatory statute and important state policy issues, the federal court should abstain and
remand the matter to state court); Glen 6 Assocs. v. Dedaj, 770 F.Supp. 225, 228-29
(S.D.N.Y. 1991) (finding that principles of comity and federalism dictate abstaining from
eviction matters and that accepting removal of eviction proceedings to federal court
would overburden the federal system); Doescher v. Menifee Circuit Court, 75 Fed.Appx.
996, 997 (6th Cir. 2003) (state foreclosure proceeding involved a matter of state interest);
Federal courts in the Sixth Circuit, as well as other circuits, have abstained from
exercising jurisdiction over similar cases involving detainer actions. See Deutsche Bank
Trust Co. v. Hollander, 2012 WL 3639283 (E.D.Mich. 2012); Healy v. Fifth Third Mtg.
Co., 2011 WL 577385 (E.D.Ky. 2011); Doyle v. Schumann, 2008 WL 397588 (N.D.Ohio
2008). See also Federal Home Loan Mtg. Ass’n v. Ville, 2014 WL 300948 (D.Minn.
2014); Federal Nat’l Mtg. Ass’n v. Guevara, 2014 WL 300985 (D.Minn. 2014); Federal
Nat’l Mtg. Ass’n v. Bullock, 2014 WL 223445 (D.Minn. 2014).
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Moreover, to the extent that Dunn is attempting to assert a counterclaim based on
federal law against FHMLC, that is insufficient to give this court jurisdiction over the
state detainer action. If the federal question appears only as a defense, and not on the
face of a well-pleaded complaint, the defense does not authorize removal to federal court.
Metropolitan Life Ins. Co. v. Taylor, 481 U.S. 58, 63 (1987).
In light of the above federal precedent, the court concludes that abstention is
proper in this case.
Eviction actions are fundamentally a matter of state law; there is no
federal interest in retaining the proceedings; and there is no apparent prejudice in the
action proceeding in state court. State courts are highly familiar with eviction procedure,
and the federal courts are ill-equipped to adjudicate these actions. See Fed. Home Loan
Mtg. Corp. v. Matassino, 2012 WL 6622607 at *8 (N.D.Ga. 2012).
Considering
principles of comity, federalism, and judicial economy, the court will abstain from
exercising jurisdiction in this matter, and finds that remand is warranted. Accordingly,
FHMLC’s motion to remand is GRANTED.
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III. Conclusion
In light of the above discussion, FHMLC’s motion to remand [R. 3] is
GRANTED, and this action is REMANDED to the General Sessions Court for Knox
County, Tennessee.
Enter:
s/
______________________________________
United States District Judge
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