Tag Archives: quiet title

Georgia Court Dismisses RESPA, TILA, and HOEPA Claims

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The court in deciding Mitchell v. Deutsche Bank Nat’l Trust Co., 2013 U.S. Dist. (N.D. Ga., 2013) granted the defendant’s motion to dismiss.

Plaintiffs Reginald and Jamela Mitchell claimed that the defendants Deutsche Bank National Trust Co. and MERS violated the Truth-in-Lending Act (“TILA”), the Real Estate Settlement Procedures Act (“RESPA”), the Home Ownership Equity Protection Act (“HOEPA”) and state law by commencing foreclosure proceedings against Plaintiffs’ home.

After consideration of the plaintiff’s assertions, the court concluded that the complaint failed to state a claim upon which relief could be granted.

Georgia Court Dismisses TILA and RESPA Claims Brought by Plaintiff

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The court in deciding Mitchell v. Deutsche Bank Nat’l Trust Co., 2013 U.S. Dist. (N.D. Ga. Sept. 25, 2013) granted the motion to dismiss proffered by the defendant.

The first enumerated cause of action in Plaintiffs’ complaint was a claim for fraud. Plaintiffs argued that their original mortgage lender, Accredited, engaged in a practice of filing false prospectus supplements with the Securities and Exchange Commission. Plaintiffs’ complaint also included a claim for wrongful foreclosure.

Next, the plaintiffs asserted that Deutsche Bank and MERS had “unclean hands” as they failed to make certain disclosures required by TILA. Plaintiffs also asserted that the defendants or their predecessors in interest violated RESPA in a number of ways. Plaintiffs’ complaint also included a claim for fraud in the inducement. Moreover, the plaintiffs’ complaint raised a claim for quiet title under O.C.G.A. § 23-3-40 and O.C.G.A. § 23-3-60 et seq. Lastly, the plaintiffs’ complaint raised a claim for fraudulent assignment.

Ultimately the court concluded that the plaintiffs’ complaint failed to state a viable claim for relief. Accordingly, this court granted the defendants’ motion to dismiss the plaintiffs’ complaint.

Court Dismissed Minn. Stat. § 559.01 Claims

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The court in deciding Lubbers v. Deutsche Bank Nat’l Trust Co., 2013 U.S. Dist. (D. Minn., 2013) dismissed plaintiff’s claims.

Plaintiffs sought to invalidate the foreclosure of the mortgage on their home. Plaintiffs asserted three claims against defendant: (1) quiet-title, to determine adverse claims under Minn. Stat. § 559.01; (2) declaratory judgment; and (3) slander of title.

Plaintiffs alleged the following causes of action:

In count I, plaintiffs asserted a quiet title action pursuant to Minn. Stat. § 559.01, and sought a determination regarding Deutsche Bank’s adverse interest in the Property. According to plaintiffs, in a quiet title action, the burden of proof was on the mortgagee asserting an adverse interest in the property to show that both record title and legal title concur and co-exist at the same time and in the same entity to foreclose by advertisement.

In count II, plaintiffs sought a declaratory judgment under Minn. Stat. § 555.02 that the various assignments of mortgage, notices of pendency, and powers of attorney were all void, and that plaintiffs remain the owner of the property in fee title.

Count III, plaintiff alleged slander of title, plaintiffs asserted that Wilford, acted at direction of Deutsche Bank, drafted and recorded documents that were false and not executed by legally authorized persons, and that Deutsche Bank knew that the documents were false because unauthorized persons executed the power of attorneys and the assignments of mortgage.

As relief, plaintiffs sought: (1) a determination of adverse interest in the Property; (2) a declaration that the sheriff’s certificate of sale, the various assignments of mortgage, notices of pendency, and powers of attorney are all void; (3) a declaration that plaintiffs remain the owner of the Property in fee title; and (4) money damages. Id., Prayer for Relief.

After considering the plaintiff’s claims, this court granted the defendant’s motion to dismiss.

Defendants Could Not Show They Were not Debt Collectors as Defined by 15 U.S.C.S. § 1692a(6)(F)

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The court in deciding Dias v. Fannie Mae, 2013 U.S. Dist. LEXIS 181584 (D. Haw., 2013) rejected all but one of the plaintiff’s claims.

The court found that the plaintiff’s Haw. Rev. Stat. § 667-5 defective assignment claims against defendants failed because the mortgage gave the requisite authority.

The court found that a claim that no sale could be held pending a Home Affordable Modification Program (HAMP) modification failed because the mortgagor lacked standing. The false mortgage assignment claim failed because nothing showed a publicly recorded assignment was false. Likewise, the breach of contract claim for violating HAMP guidelines failed because the mortgagor had no such claim, no HAMP trial payment plan supported it, and she was not an intended beneficiary of any HAMP agreement between defendants and the U.S. Treasury.

However, the plaintiff’s Fair Debt Collection Practices Act, 15 U.S.C.S. § 1692, claims survived because a defaulted debt was assigned, so defendants could not show they were not debt collectors, under 15 U.S.C.S. § 1692a(6)(F).

Massachusetts Supreme Court Dismisses Try Title Action Due To Lack Of Subject Matter Jurisdiction

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In Bevilacqua v. Rodriguez, 460 Mass. 762 (2011), theMassachusetts Supreme Court handled the issue of whether a plaintiff had standing to maintain a try title action under G.L. c. 240, §§ 1-5, where he was in physical possession of real property but his chain of title rested on a foreclosure sale conducted by someone other than “the mortgagee or his executors, administrators, successors or assigns.”

In this case, the purchaser of property, after foreclosure of a mortgage, brought an action to try title against mortgagor. The purchaser alleged, that because foreclosure sale had been conducted by assignee before the mortgagee had actually assigned mortgage, a cloud existed on purchaser’s title. This action was dismissed, and an appeal ensued. On review, the Massachusetts Supreme Court affirmed the lower court’s holding. However, the court modified the lower court’s holding, finding that the dismissal should have been entered without prejudice.

The court found that the lower court properly raised the issue of whether the plaintiff had record title to the property such that he had standing to bring a try title action. The court found that the plaintiff had not identified a basis on which the court could conclude that the plaintiff had record title to the property such that a try title action could be sustained.

Michigan District Court Dismisses Borrower’s Complaint After Failure to Redeem Property within Statutory Period

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In Vollmar v. Federal National Mortgage Association, (12-cv-1119, E.D. Mich. 2012), the U.S. District Court for the Eastern District of Michigan, granted the defendant’s motion to dismiss each of the plaintiff’s complaints that sought to invalidate the foreclosure sale of his property and to quiet title. The judge ruled that the plaintiff lacked standing after failing to redeem the property within the allotted period.

In the case at hand, the plaintiff took out a $128,000 mortgage on his property with Countrywide Home Loans, Inc., with Mortgage Electronic Registration Systems, Inc. (“MERS”) as the mortgagee. MERS assigned its interests to BAC Home Loan Servicing, L.P. (“BACHLS”) in a recorded deed on July 23, 2010. The plaintiff defaulted on his payments and BACHLS instituted foreclosure proceedings in March 2011. The property was purchased in a sheriff sale by Bank of America, N.A. (“BANA”), the successor by merger to BACHLS.

The Court addressed the plaintiff’s claims in conjunction with the defendant’s motion to dismiss.

1. The Court held that the plaintiff lacked standing to challenge the sheriff’s sale due to his failure to redeem the property within Michigan’s 6-month statutory redemption period. At the close of the statutory period, title is vested with the purchaser and the mortgagor loses standing to challenge the sale. Rather than preserving his right to challenge the foreclosure sale by remaining in the home, as the plaintiff argued, the Court held that the ownership interest “terminated at the conclusion of the sheriff’s sale,” and the plaintiff was merely an “illegal holdover.”

2. Defendant claimed that the plaintiff’s amended complaint does not contain allegations of “fraud or irregularity” that are sufficient to annul the foreclosure sale under a breach of contract claim. The plaintiff alleged that the defendants were required to demonstrate by whom the foreclosure proceedings were initiated and failed to produce evidence that BANA acquired BACHLS interest in the mortgage. The Court dismissed the plaintiff’s allegations, noting that the Defendant’s motion papers, foreclosure advertisements, and the initial collection letter to the plaintiff each established that BACHLS both received the mortgage interest from MERS and initiated the foreclosure proceedings. In regards to BANA’s role, the Court referenced Texas Business Organization Codes (Tex. Bus. Orgs. Code §10.008(a)(2)(C)), under which BACHLS and BANA merged on July 1, 2011), which established that after the merger of the two companies, BANA acquired all of BACHLS rights, titles, and interests without the need for “any transfer or assignment.”

3. The Court addressed the plaintiff’s slander of title and quiet title claims even though they were abandoned for failure to address them in the response brief. Because slander of title and quiet title “presuppose that plaintiff possesses the ability to establish title” and the Court has already established that the plaintiff’s rights to the property were extinguished at the end of the statutory period, both claims were dismissed.

4. Since the plaintiff failed to allege that the contract left the manner of performance open to the defendant’s discretion, and that the “manner of performance” of the mortgage rested in the defendants hands, an element required to raise a breach of implied covenant of good faith and fair dealing claim, the Court refused to accept the cause of action, citing Meyer v. CitiMortgage, Inc. 11-13432, 2012 WL 511995 (E.D. Mich. Feb. 16, 2012) which stated that Michigan law does not recognize an independent action for breach of the implied covenant of good faith and fair dealing when the contract cannot be construed to imply such a covenant by having left the manner of performance open to the defendant’s discretion.

5. Finally, the Court addressed the plaintiffs “seemingly abandoned” claim of intentional infliction of emotional distress to reassert that “emotional damages are not available for breach of contract” claims. Citing Kevelighan v. Orlans  Assocs., P.C., 498 F. App’x 469, 472 (6th Cir. 2012) which upheld the dismissal of an emotional distress claim in a breach of mortgage contract suit.

Northern District of Ohio Holds that Mortgage Conveys Beneficial Interest to MERS as Nominee, Mortgagee

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In Meehan v. Mortgage Elec. Registration Sys., Inc., 1:11CV363, 2011 WL 3360193 (N.D. Ohio Aug. 3, 2011), the United States District Court for the Northern District of Ohio held that MERS had a beneficial interest in the property based on the language of the mortgage agreement. In this case, the homeowners filed an action to quiet title, claiming, “MERS has no beneficial interest in the mortgage. . . [further,] MERS’s interest is adverse and constitutes a cloud on the title to [the] property.” MERS claimed it had a beneficial interest in the property because the mortgage named MERS as nominee for the lender as well as the mortgagee. The court found that the contract language was clear and an action to quiet title, which is an equitable remedy, was not available to the homeowners in this case. Thus, the court held that the homeowners claim was without merit and granted MERS’s motion to dismiss.