Roman v. U.S. Bank National Association, as Trustee for GSAA Home Equity Trust 2006-12, Asset-Backed Certificates, Series 2006-12

Filing 12

MEMORANDUM OPINION. Signed by District Judge Henry E. Hudson on 05/18/2018. (tjoh, )

IN THE UNITED STATES DISTRICT COURT

FOR THE EASTERN DISTRICT OF VIRGINIA
Richmond Division

THERESA B. ROMAN,

Plaintiff,
V.

Civil Action No. 3:18cvl57-HEH

U.S. BANK NATIONAL ASSOCIATION,
as TRUSTEE for GSAA HOME EQUITY
TRUST 2006-12, ASSET-BACKED
CERTIFICATES, SERIES 2006-12,
Defendant.
MEMORANDUM OPINION

This matter is before the Court on Plaintiff Theresa B. Roman's("Plaintiff) Motion

for Leave to File an Amended Complaint and Seeking Leave to File Late Opposition to
Motion to Dismiss on the Pleadings; Alternatively, Motion for Leave to Dismiss Without

Prejudice(ECF No. 7), filed on April 20,2018. On May 7, 2018, this Court issued an Order
(ECF No. 11) denying Plaintiff leave to file an amended complaint and granting Plaintiffs
alternative motion to dismiss without prejudice. The Court's reasoning underlying that
Order is articulated below.
I.

BACKGROUND

On April 28, 2006, Plaintiffs mother Venice E. Briggs("Briggs") entered into a loan
agreement with Madison Funding Inc. that was eventually assigned to Defendant U.S. Bank
National Association ("Defendant"). (Compl.

4,6, ECF No. 1-3.) The loan was secured

by a deed of trust —signed by both Briggs and Plaintiff—^that became a lien on the property

located at 5405 Wellington Ridge Road, Richmond, Virginia 23231 ("Property"). {Id, ^ 4.)

In August 2006, Venice Briggs died, and Plaintiff became the sole owner of the Property and

the personal representative of Briggs's estate. {Id.

9, 14.) In September 2006, Plaintiff

"re-executed the deed of trust to correct a technical error in the description ofthe residence."
{Id. H 9.)

Paragraph 22 ofthe re-executed deed ("Deed")contains a provision that allows for an
acceleration of the loan in the event of a default. {Id. at Ex. A.) This provision requires the

Lender to send the Borrower notice prior to acceleration that provides the Borrower with
information related to curing the default. {Id.) According to paragraph 15 ofthe Deed,

"[njotice to any one Borrower shall constitute notice to all Borrowers." {Id.) The Deed also
includes a page titled "Exhibit A," which contains a handwritten message that states: "said
Venice Briggs departed from this life on or around August 31, 2006." {Id.) However,
Venice Briggs remains listed as a Borrower in the Deed. {Id.)

On July 12, 2017, Defendant sent a notice to the Property that was addressed to
Venice Briggs and provided the information required by paragraph 22. {Id. ^ 17.)

Subsequently, a foreclosure of the Property was scheduled for January 18,2018, which
Plaintiff contends is "void, alternatively voidable." {Id. 29.)
II.

STANDARD OF REVIEW

Rule 15 of the Federal Rules of Civil Procedure provides that parties should

"freely" be given leave to amend their pleadings "when justice so requires." Fed. R. Civ.
P. 15(a)(2). As the Fourth Circuit has explained,"[a] motion to amend should be denied
only where it would be prejudicial, there has been bad faith, or the amendment would be

futile." Nourison Rug Corp. v. Parvizian, 535 F.3d 295, 298(4th Cir. 2008)(citing
HCMF Corp. v. Allen, 238 F.3d 273,276-77(4th Cir. 2001)).
Amendment is futile when a proposed amended complaint fails to state a claim.

U.S. ex rel. Wilson v. KelloggBrown & Root, Inc., 525 F.3d 370, 376(4th Cir. 2008).

Whether a complaint fails to state a claim, and thus whether amendment would be futile,
is analyzed under Rule 12(b)(6) of the Federal Rules of Civil Procedure. Thus,the

"[f]actual allegations must be enough to raise a right to relief above the speculative
level," Bell All. Corp. v. Twombly,550 U.S. 544, 555(2007) (citation omitted), to one

that is "plausible on its face," id. at 570, rather than merely "conceivable." Id. In
considering a Rule 12(b)(6) motion, a plaintiffs well-pleaded allegations are taken as
true and the complaint is viewed in the light most favorable to the plaintiff. T.G. Slater &
Son V. Donald P. & Patricia A. Brennan, LLC,385 F.3d 836, 841 (4th Cir. 2004)

(citation omitted). Legal conclusions enjoy no such deference. Ashcroftv. Iqbal, 556
U.S. 662, 678(2009).
III.

DISCUSSION

Plaintiffs Complaint asserts two counts. Count One alleges that Defendant breached
the Deed by addressing the notice to Briggs, even though Defendant was made aware of
Briggs's death in 2006. Count Two alleges that Trustee Services, which was not included as
a party to this action, owed Plaintiff a fiduciary duty not to foreclose on the Property.

Plaintiffs proposed Amended Complaint(ECF No. 7-1) only asserts one count for breach of
the Deed and adds Trustee Services as a nominal party. The claim for breach ofthe Deed in

both Plaintiffs Complaint and her proposed Amended Complaint rely on the same
allegations.

In Virginia, "[t]he elements of a breach of contract action are (1)a legally
enforceable obligation of a defendant to a plaintiff;(2)the defendant's violation or

breach of that obligation; and(3)injury or damage to the plaintiff caused by the breach of
obligation." William H. Gordon Assocs,, Inc. v. Heritage Fellowship, United Church of
Christ, 784 S.E.2d 265, 274(Va. 2016). "When the language of a deed is 'clear,

unambiguous, and explicit,' a court interpreting it 'should look no further than the four
comers of the instmment under review.'" Utsch v. Utsch, 581 S.E.2d 507, 509(Va.

2003)

Pyramid Dev. v. D&JAssocs., 553 S.E.2d 725, 728(Va. 2001)).

Plaintiffs proposed Amended Complaint is futile. Plaintiff does not contend that
the substance ofthe notice provided by Defendant was deficient. Instead, her sole
allegation is that addressing the notice to her deceased mother breached the Deed. The
Deed required notice to be given to the Borrower and stated "[n]otice to any one Borrower
shall constitute notice to all Borrowers." Plaintiffs mother remained listed as a Borrower on

the Deed after Plaintiff re-executed it and was listed as a Borrower when Defendant sent the

notice. Accordingly, addressing the notice to Briggs was not improper based upon the plain
language of the Deed.

Additionally, Plaintiff does not allege in either her Complaint or her proposed
Amended Complaint that she would have been able to cure the default had the notice been

addressed to her. Notwithstanding dicta in Squire v. Va. Hous. Dev. Auth., 758 S.E.2d 55

(Va. 2014),' Virginia law requires a plaintiff bringing a breach of contract action to plead
damages. In this case, Plaintiff did not identify the damage she allegedly suffered due to ^
the breach and thus did not state a claim upon which relief could be granted.
For these reasons. Plaintiffs Motion for Leave to File an Amended Complaint and

Seeking Leave to File Late Opposition to Motion to Dismiss on the Pleadings was denied.

Alternatively, Plaintiff moved for leave to dismiss the action without prejudice. After
due consideration, the Court determined that a dismissal without prejudice was an

appropriate resolution to this matter and granted Plaintiffs alternative motion.
IV.

CONCLUSION

Based upon the foregoing reasons. Plaintiffs Motion for Leave to File an Amended

Complaint and Seeking Leave to File Late Opposition to Motion to Dismiss on the Pleadings
was denied, and Plaintiffs altemative Motion for Leave to Dismiss Without Prejudice was

granted. Consequently, Defendant's Motion for Judgment on the Pleadings and to Dismiss
Complaint pursuant to Rule 12(c) was denied as moot, and the case was dismissed without
prejudice.

'The majority in Squire cites Bayview Loan Servicing, LLC v. Simmons,654 S.E.2d 898(Va. 2008), as a
case where the Virginia Supreme Court "affirmed an award of damages against a lender in a postforeclosure situation" in spite of the fact that "[t]he borrower did not allege what she would have done to
prevent the foreclosure sale had she received notice." Squire, 758 S.E.2d at 61 n.2. Importantly though,
Bayview did not examine the issue of pleading damages in an action for breach of a deed of trust. Instead,
the sole assignment of error in Bayview involved interpreting Va. Code Ann. § 55-59.1(A)to determine
whether a notice provided by the lender could be understood to have "effectively exercised the right of
acceleration." Bayview,654 S.E.2d at 900. Moreover, the issue of damages was not present in Squire as
the plaintiff in that case "had money with which to reinstate the loan and offered to pay it." Squire, 758
S.E.2d at 68(Mims, J., concurring).

The Clerk is DIRECTED to send a copy ofthis Memorandum Opinion to all counsel
of record.

Henry E. Hudson
United States District Judge
Date:.

Richmond, Virginia