Bernard F. Clark v. Countrywide Home Loans, Inc. et al, No. 1:2009cv01998 - Document 61 (E.D. Cal. 2010)
Court Description: MEMORANDUM DECISION Regarding 50 Motion to Dismiss Second Amended Complaint and 52 Motion To Expunge Lis Pendens, signed by Judge Oliver W. Wanger on 12/2/2010. (Plaintiffs SAC is DISMISSED, without prejudice, Defendantwill have one more oppor tunity to amend the complaint; Defendants Motion to Expunge Lis Pendens is GRANTED, and Defendants shall submit a form of order consistent with this Memorandum Decision within five (5) days following electronic service of this decision.) (Gaumnitz, R)
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Bernard F. Clark v. Countrywide Home Loans, Inc. et al Doc. 61 1 2 3 4 UNITED STATES DISTRICT COURT 5 EASTERN DISTRICT OF CALIFORNIA 6 7 8 1:09-CV-01998-OWW-GSA BERNARD F. CLARK, 9 MEMORANDUM DECISION REGARDING MOTION TO DISMISS SECOND AMENDED COMPLAINT AND MOTION TO EXPUNGE LIS PENDENS Plaintiff, 10 v. 11 12 COUNTRYWIDE HOME LOANS, INC., et al., 13 Defendants. 14 I. INTRODUCTION. 15 16 Plaintiff Bernard F. Clark proceeds pro se with an action for 17 damages against Defendants Countrywide Home Loans and Bank of 18 America. Defendant filed the original complaint in this action in state 19 20 court on August 24, 21 Plaintiff’s 22 Plaintiff subsequently filed a first amended complaint (“FAC”). action to 2009. (Doc. federal court 1). on Defendants November 12, removed 2009. 23 On August 9, 2010, the court issued a Memorandum Decision 24 dismissing the majority of Plaintiff’s FAC with prejudice. (Doc. 25 45). 26 order to plead a fraud claim and a breach of contract claim. (Id.). 27 Plaintiff filed a second amended complaint (“SAC”) on September 9, 28 2010. Plaintiff was only given leave to amend his complaint in (Doc. 47). 1 Dockets.Justia.com 1 Defendants filed a Motion to Dismiss the SAC and Motion to 2 Expunge Lis Pendens on September 27, 2010. (Docs. 50, 52). 3 Plaintiff filed opposition to Defendants’ motions on October 25, 4 2010. (Docs. 55, 56). 5 2010. (Doc. 57). Defendants filed a reply on November 15, II. FACTUAL BACKGROUND. 6 7 On or about July 26, 2007, Plaintiff financed the purchase of 8 a residential property located at 12689 Mt. Jefferson Street, 9 Groveland, California (“Subject Property”) through a promissory 10 note secured by a deed of trust. 11 closing, the lender orally assured Plaintiff that if he was unable 12 to 13 modification based on his income. 14 satisfy his mortgage The SAC alleges that before loan obligation, he would receive a loan In 2008, Plaintiff defaulted on his mortgage and called 15 Countrywide Home Loans 16 solution. Countrywide orally told Plaintiff that if he brought his 17 loan current, Countrywide would enter into a loan modification 18 agreement with him. On or about June 16, 2008, Plaintiff borrowed 19 money and brought his loan current, but Countrywide refused to 20 enter into a loan modification agreement. III. 21 22 (“Countrywide”) Dismissal under Rule to discuss a possible LEGAL STANDARD. 12(b)(6) is appropriate where the 23 complaint lacks sufficient facts to support a cognizable legal 24 theory. 25 (9th Cir.1990). 26 survive a 12(b) (6) motion, the pleading “does not need detailed 27 factual allegations” but the “[f]actual allegations must be enough 28 to raise a right to relief above the speculative level.” Bell Atl. Balistreri v. Pacifica Police Dep't, 901 F.2d 696, 699 To sufficiently state a claim to relief and 2 1 Corp. v. Twombly, 550 U.S. 544, 555, 127 S.Ct. 1955, 167 L.Ed.2d 2 929 3 recitation of the elements of a cause of action will not do.” Id. 4 Rather, there must be “enough facts to state a claim to relief that 5 is plausible on its face.” Id. at 570. In other words, the 6 “complaint must contain sufficient factual matter, accepted as 7 true, to state a claim to relief that is plausible on its face.” 8 Ashcroft v. Iqbal, --- U.S. ----, ----, 129 S.Ct. 1937, 1949, 173 9 L.Ed.2d 868 (2009) (internal quotation marks omitted). (2007). Mere “labels and conclusions” or a “formulaic 10 The Ninth Circuit has summarized the governing standard, in 11 light of Twombly and Iqbal, as follows: “In sum, for a complaint to 12 survive a motion to dismiss, the nonconclusory factual content, and 13 reasonable 14 suggestive of a claim entitling the plaintiff to relief.” Moss v. 15 U.S. Secret Serv., 572 F.3d 962, 969 (9th Cir.2009) (internal 16 quotation marks omitted). Apart from factual insufficiency, a 17 complaint is also subject to dismissal under Rule 12(b)(6) where it 18 lacks a cognizable legal theory, Balistreri, 901 F.2d at 699, or 19 where the allegations on their face “show that relief is barred” 20 for some legal reason, Jones v. Bock, 549 U.S. 199, 215, 127 S.Ct. 21 910, 166 L.Ed.2d 798 (2007). inferences from that content, must be plausibly 22 In deciding whether to grant a motion to dismiss, the court 23 must accept as true all “well-pleaded factual allegations” in the 24 pleading under attack. Iqbal, 129 S.Ct. at 1950. A court is not, 25 however, “required to accept as true allegations that are merely 26 conclusory, 27 inferences.” Sprewell v. Golden State Warriors, 266 F.3d 979, 988 28 (9th Cir.2001). “When ruling on a Rule 12(b)(6) motion to dismiss, unwarranted deductions 3 of fact, or unreasonable 1 if a district court considers evidence outside the pleadings, it 2 must normally convert the 12(b)(6) motion into a Rule 56 motion for 3 summary 4 opportunity to respond.” 5 907 (9th Cir. 2003). “A court may, however, consider certain 6 materials-documents 7 incorporated by reference in the complaint, or matters of judicial 8 notice-without converting the motion to dismiss into a motion for 9 summary judgment.” Id. at 908. judgment, and must give the nonmoving party an United States v. Ritchie, 342 F.3d 903, attached to the complaint, documents IV. DISCUSSION. 10 11 it Although the Memorandum Decision specifically advised 12 Plaintiff that he was granted leave to amend the complaint only to 13 state a cause of action for fraud, the SAC asserts a cause of 14 action for “breach of loan modification and contract.” 15 of contract claim advanced in the SAC is indistinguishable from the 16 claim 17 Decision provides: 18 19 20 21 22 23 24 25 26 27 28 dismissed in the Memorandum Decision. The The breach Memorandum Certain types of contracts are invalid unless memorialized by a written document signed by the party against whom the contract is being enforced. Cal. Civ. Code § 1624. Mortgages and deeds of trust are subject to the statute of frauds. Secrest v. Sec. Nat?l Mortg. Loan Trust 2002-2, 167 Cal. App. 4th 544, 552 (2008). “An agreement to modify a contract that is subject to the statute of frauds is also subject to the statute of frauds” and must be in writing. Id. at 553; see also Basham v. Pac. Funding Group, 2010 WL 2902368 (E.D. Cal. July 22, 2010)(dismissing a claim that defendant breached an oral contract to provide plaintiffs with a loan modification because, under the statute of frauds, “absent a writing, there can be no contract, much less a breach of contract.”); Justo v. Indymac Bancorp, et al., 2010 WL 623715 (E.D. Cal. Feb. 19, 2010)(plaintiff?s claim that defendants breached an oral contract to modify his loan and cancel the foreclosure sale was barred by the statute of frauds). A written contract may not be modified by an oral agreement, unless that oral agreement is memorialized in writing and signed by the parties. 4 1 Cal. Civ. Code § 1698. 2 Here, the alleged promise for a loan modification is subject to the statute of frauds. Absent a written agreement to modify the loan, any claim based upon an oral contract to modify the loan is barred by the statute of frauds. See Secrest, 167 Cal. App. 4th at 552. 3 4 5 6 7 8 9 10 11 12 At oral argument, Plaintiff claimed that Countrywide promised him that if he brought the loan current, they would modify his loan. Plaintiff further claims that, in reliance on this promise, he obtained money (approximately $8,000) to bring the loan current, but Countrywide refused the loan modification. Although Plaintiff cannot state a breach of contract claim based upon this conduct, he may be able to state a claim for fraud. In California, the elements for a claim of fraud are: (1) misrepresentation; (2) knowledge of falsity; (3) intent to defraud; (4) justifiable reliance; and (5) resulting damage. Small v. Fritz Companies, Inc., 30 Cal. 4th 167, 173 (2003). Upon removal to federal court, all claims for fraud must be pled with sufficient particularity to satisfy Federal Rule of Civil Procedure Rule 9(b). 13 14 (Memorandum Decision at 7-8). 15 Plaintiff in the Memorandum Decision, the SAC fails to allege that 16 any Defendant made any knowingly false representation with the 17 intent 18 particularity requirements of Rule 9 by alleging the who, what 19 where, 20 principles, 21 consideration. A promise to perform a pre-existing obligation does 22 not constitute consideration and there is no right to enforce such 23 an alleged promise. 24 amend his complaint and has failed to state any cognizable claim. 25 Accordingly, the SAC is dismissed, with prejudice. 26 Plaintiff has not asserted any claim that implicates title to the 27 property underlying the Subject Loan, Defendants’ motion to expunge 28 lis pendens is GRANTED. to and defraud Plaintiff Despite the guidance provided to and has inducement requirements. a cannot contract be not complied Under enforced with the well-established when there is no Plaintiff has had multiple opportunities to 5 Further, as ORDER 1 2 For the reasons stated, IT IS ORDERED; 3 1) Plaintiff’s SAC is DISMISSED, without prejudice, Defendant 4 will have one more opportunity to amend the complaint; 5 2) Defendants Motion to Expunge Lis Pendens is GRANTED, and 6 3)Defendants shall submit a form of order consistent with this 7 Memorandum Decision within five (5) days following electronic 8 service of this decision. 9 10 IT IS SO ORDERED. 11 Dated: aa70i8 December 2, 2010 /s/ Oliver W. Wanger UNITED STATES DISTRICT JUDGE 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 6
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