Lauderdale v. Wells Fargo Bank, N.A.
Filing
24
MEMORANDUM OPINION AND ORDER granting 11 MOTION to Dismiss with Prejudice Pursuant to FRCP 12(b)(6) (Signed by Magistrate Judge Nancy K. Johnson) Parties notified.(pyebernetsky, )
IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF TEXAS
HOUSTON DIVISION
KATHY E. LAUDERDALE,
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Plaintiff,
v.
WELLS FARGO BANK, N.A.,
Defendant.
Civil Action No. H-11-3449
MEMORANDUM OPINION AND ORDER
Pending before the court1 is Defendant’s Motion to Dismiss
with Prejudice (Doc. 11).
For the reasons set forth below, the
motion is GRANTED.
I. Case Background
This action was removed to this court on September 22, 2011,
pursuant to this court’s diversity jurisdiction.2
Plaintiff Kathy
Lauderdale (“Plaintiff”) alleges five causes of action against
Defendant Wells Fargo Bank, N.A. (“Defendant”): 1) Declaratory
Judgment;
2)
Breach
of
Contract;
3)
Negligence;
4)
Wrongful
Foreclosure; and 5) Slander of Title.3
1
The parties consented to proceed before the undersigned magistrate judge
for all proceedings, including trial and final judgment, pursuant to 28 U.S.C.
§ 636(c) and Federal Rule of Civil Procedure 73. Doc. 7.
2
Doc. 1, Notice of Removal.
3
Doc. 1-3, Ex. 2 to Notice of Removal, Pl.’s Original Petition, Petition
for Declaratory Relief, Application for Injunctive Relief, and Request for
Disclosures (“Pl.’s Petition”), ¶¶ 15-25.
The
following
allegations
are
taken
from
Plaintiff’s
Petition.4 In September of 2007, Plaintiff purchased real property
from a third party, and signed a Deed of Trust and Promissory Note
with that third party.5
The Deed of Trust and Promissory Note were
later transferred from the third party to Defendant.6
transfer, Plaintiff fell behind on her payments.7
After the
In the first
quarter of 2010, Plaintiff applied for a loan modification from
Defendant.8
Plaintiff claims that she was told by employees of
Defendant not to make payments and to ignore foreclosure notices
during the loan modification process.9
Plaintiff received proposed terms of a modification in April
of 2010, and continued negotiations with Defendant.10
In January
of 2011, Defendant accelerated the note due to non-payment of the
mortgage
and
began
the
process
for
a
foreclosure
sale.11
A
foreclosure sale occurred on March 1, 2011, and the property was
4
Doc. 1-3, Pl.’s Petition.
5
Id. at ¶ 6.
6
Id. at ¶ 7.
7
Id. at ¶ 8.
8
Id. at ¶ 9.
9
Id. at ¶ 10.
10
Id.
11
Id. at ¶ 12.
at ¶ 11.
2
purchased by Defendant.12
Plaintiff remains in the property based
on an injunction issued by the state court.
II. Standard
Rule 8(a)(2) “requires only a ‘short and plain statement of
the claim showing that the pleader is entitled to relief,’ in order
to ‘give the defendant fair notice of what the . . . claim is and
the grounds upon which it rests.’ ”
Fed. R. Civ. P. 8(a)(2); Bell
Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007) (quoting Conley v.
Gibson, 355 U.S. 41, 47 (1957)).
The question in a Rule 12(b)(6)
motion, therefore, is whether the complaint states a valid claim
when all well-pleaded facts are assumed true and are viewed in the
light most favorable to the plaintiff.
Fed. R. Civ. P. 12(b)(6);
In re Katrina Canal Beaches Litig., 495 F.3d 191, 205 (5th
Cir.
2007).
The court determines whether the plaintiff has stated a
legally cognizable claim that is plausible; the court does not
evaluate the plaintiff's likelihood of success. Ashcroft v. Iqbal,
556 U.S. 662, 678 (2009).
A pleading will not survive a motion to
dismiss if it only offers labels and conclusions, a formulaic
recitation
of
the
elements
of
a
cause
of
action,
assertions devoid of further factual enhancement.
III. Analysis
12
Id. at ¶ 14.
3
Id.
or
naked
Defendant moves to dismiss all of Plaintiff’s claims pursuant
to Federal Rule of Civil Procedure 12(b)(6).
respond to this motion.
Plaintiff did not
After consideration of the merits of the
motion, the court agrees that Plaintiff failed to state a claim
upon which relief can be granted, as explained below.
A. Declaratory Judgment
A declaratory judgment allows “a person interested under a
deed” to “have determined any question of construction or validity
arising under the instrument, statute, ordinance, contract, or
franchise and obtain a declaration of rights, status, or other
legal relations thereunder.”
37.004 (West).
Tex. Civ. Prac. & Rem. Code Ann. §
The court may declare “rights, status, and other
legal relations.”
Tex. Civ. Prac. & Rem. Code Ann. § 37.003
(West).
Plaintiff’s
complaint
requests
a
declaration
that
foreclosure sale was ineffective and, therefore, void.
the
This
requires a finding that Defendant breached the contract with
Plaintiff, which is a question of fact. This “is not a declaration
of a right or status and therefore, is not the proper subject of a
declaratory judgment.” Hill v. Heritage Res., Inc., 964 S.W.2d 89,
140 (Tex. App.--El Paso 1997, pet. denied).
Plaintiff also seeks a declaration that estoppel and laches
bar Defendant from taking actions against the property adverse to
Plaintiff.
Plaintiff did not plead any facts that would explain
4
how or why these doctrines would apply.
Without facts to support
a request for declaratory relief, the pleading does not meet the
threshold standards of Iqbal and Twombly.
Therefore, Plaintiff’s
claims for declaratory relief are DISMISSED.
B. Breach of Contract
A breach of contract claim requires allegations that: 1) a
valid
contract
exists;
2)
plaintiff
fully
performed
her
obligations; 3) defendant breached the contract; and 4) plaintiff
was damaged as a result of the breach.
Hovorka v. Cmty. Health
Sys., Inc., 262 S.W.3d 503, 508-09 (Tex. App.--El Paso 2008, no
pet.).
Here, Plaintiff avers that after she became delinquent on her
payment
obligations
modification.13
under
the
note,
she
requested
a
loan
During the loan modification process, the bank
accelerated the note and foreclosed on the loan.14
The present
complaint does not allege that Defendant breached an existing
contract.
Instead, Plaintiff appears to be complaining that after
she breached the contract by not making her payments, Defendant did
not consummate a loan modification agreement after months of
negotiations for such an agreement and foreclosed on the home after
telling her to ignore foreclosure notices.
13
14
Doc. 1-3, Pl.’s Petition, ¶ 8.
Doc. 1-3, Pl.’s Petition, ¶ 14.
5
Plaintiff’s attorney
explained that her claim was in the nature of a claim for breach of
an implied contract of good faith and fair dealing.15
However,
“the
relationship
of
mortgagor
ordinarily does not involve a duty of good faith.”
and
mortgagee
Fed. Deposit
Ins. Corp. v. Coleman, 795 S.W.2d 706, 709 (Tex. 1990).
Plaintiff
has not pled sufficient facts to demonstrate that her contract with
Defendant imposed a duty of good faith and fair dealing.
In the
absence of a cognizable claim, Plaintiff’s breach of contract cause
of action is DISMISSED.
C. Negligence
A negligence claim requires allegations that: 1) defendant
owed a duty to plaintiff; 2) defendant breached that duty; and 3)
damages were proximately caused by the breach.
Elwood, 197 S.W.3d 793, 794 (Tex. 2006).
Kroger Co. v.
Additionally, the
defendant’s conduct must give rise to liability that is independent
of the contract between the parties.
Sw. Bell Tel. Co. v.
DeLanney, 809 S.W.2d 493, 494 (Tex. 1991).
Plaintiff argues that Defendant’s negligence originates from
a duty of good faith and fair dealing, arising from the contract or
by statute.16
As previously explained, a duty of good faith does
not generally arise from a mortgage contract.
Plaintiff has not
responded to this motion, therefore the court has not been provided
15
See Recording of Motion Hearing, July 31, 2012, wherein Plaintiff’s
counsel explained his theory of relief to the court.
16
Recording of Motion Hearing, July 31, 2012.
6
with any legal authority supporting a negligence theory under the
facts
as
alleged
in
the
complaint.
Therefore,
Plaintiff’s
negligence claim is DISMISSED.
D. Wrongful Foreclosure
A wrongful foreclosure claim requires a plaintiff to prove
that: 1) there was a defect in the foreclosure sale proceedings; 2)
there was a grossly inadequate selling price; and 3) there is a
causal connection between the defect and selling price. Sauceda v.
GMAC Mortg. Corp., 268 S.W.3d 135, 139 (Tex. App.--Corpus Christi
2008, no pet.).
Plaintiff has not alleged any facts supporting a conclusion
that there was a defect in the foreclosure proceedings or an
inadequate sales price.
Before a foreclosure sale can proceed,
notice of the sale must be sent to each debtor who is obligated to
pay
the
debt.
Tex.
Prop.
Code
acknowledges receiving this notice.17
Ann.
§
51.002.
Plaintiff
Although Plaintiff alleges
that “[i]n defiance of the Plaintiff’s legal rights, Wells Fargo
conducted a foreclosure sale . . .,”18 this statement is a legal
conclusion, and the court “is not bound to accept as true a legal
conclusion couched as a factual allegation.”
Papasan v. Allain,
478 U.S. 265, 286 (1986). Plaintiff has not alleged any other fact
in support of her claim that there was a defect in the foreclosure
17
Doc. 1-3, Pl.’s Petition, ¶ 12.
18
Id. at ¶ 14.
7
process, an inadequate sales price, or a causal connection between
the two.
Therefore, this claim is DISMISSED.
E. Slander of Title
A
slander
of
title
claim
requires
allegations
that:
1)
defendant uttered and published disparaging words, 2) the utterance
was false, 3) the utterance was made with malice, 4) the utterance
caused special damages, 5) plaintiff had an estate or interest in
the property, and 6) there was a loss of a specific sale.
Williams
v. Jennings, 755 S.W.2d 874, 879 (Tex. App.– Houston [14th Dist.]
1988, writ denied).
Plaintiff’s complaint contains no facts supporting any element
of this claim.
Therefore, Plaintiff’s slander of title claim is
DISMISSED.
IV. Conclusion
Based on the foregoing, Defendant’s Motion to Dismiss (Doc.
11) is GRANTED. If Plaintiff believes she can replead any claim in
conformity with this opinion, she may file a motion for leave to
amend, attaching a copy of her proposed complaint, within fourteen
days from the date this order is entered.
SIGNED in Houston, Texas, this 1st day of October, 2012.
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