Hosler v. Nationstar Mortgage, L.L.C. et al, No. 6:2014cv01347 - Document 22 (D. Kan. 2015)
Court Description: MEMORANDUM AND ORDER granting 10] Motion to Dismiss for Failure to State a Claim. Plaintiff's request for leave to file an amended complaint is denied. See order for details. Signed by U.S. District Senior Judge Sam A. Crow on 1/9/15. (msb)
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Hosler v. Nationstar Mortgage, L.L.C. et al Doc. 22 I N THE UNI TED STATES DI STRI CT COURT FOR THE DI STRI CT OF KANSAS THURMAN HOSLER, Plaint iff, vs. Case No. 14- 1347- SAC NATI ONSTAR MORTGAGE, L.L.C., and BANK OF AMERI CA, N.A., Defendant s. MEMORANDUM AND ORDER The defendant Bank of Am erica, N.A. ( “ Bank” ) m oves t o dism iss t he plaint iff’s act ions for violat ions of t he Trut h in Lending Act ( “ TI LA” ) and for breach of t he im plied covenant of good fait h and fair dealing pursuant t o Fed. R. Civ. P. 12( b) ( 6) for failure t o st at e a claim upon which relief can be grant ed. ( Dk. 10) . The plaint iff Thurm an Hosler’s claim s arise out of allegat ions t hat t he Bank caused “ force- placed insurance” t o be issued against his resident ial propert y wit hout m aking t he required disclosures and charged him unreasonable and inflat ed prem ium s for t he insurance. The Bank argues t he TI LA act ion is unt im ely and ot herwise fails, as does t he im plied covenant act ion, t o st at e an act ionable claim for relief. The plaint iff defends it s TI LA act ion as t im ely and viable, but conceding his im plied covenant act ion needs t o be am ended, he sum m arily asks for leave t o am end. Dockets.Justia.com As alleged in t he com plaint , t he plaint iff and his m ot her obt ained a not e and m ort gage for t he purchase of t heir Wichit a hom e in 2005. The Bank was servicing t he loan when t he foreclosure act ion was filed in 2010, when t he default j udgm ent was obt ained, when t he j udgm ent was lat er set aside in January of 2012, and when t he plaint iff was allowed t o resum e paym ent s t o t he Bank. On March 6, 2012, which was aft er t he plaint iff had resum ed m aking paym ent s, t he Bank “ caused force placed insurance t o be issued against t he Hosler hom e t hrough Balboa I nsurance Com pany now owed by QBE.” ( Dk. 1, ¶ 61) . The plaint iff received not ice in August of 2014 of a federal class act ion set t lem ent against t he Bank by hom eowners who had “ lender- placed hazard insurance” issued on t heir resident ial propert y bet ween from 2008 t hrough early 2014. “ According t o t he not ice, a lender placed policy was applied t o Hosler’s propert y in March 6, 2012 when Bank of Am erica, N.A., was t he servicer of t he loan.” I d. at ¶ 68. The plaint iff opt ed out of t he class act ion set t lem ent . On t he TI LA act ion, t he plaint iff alleges t he Bank violat ed 12 C.F.R. § 226.17( c) “ when it added force placed insurance t o Hosler’s m ort gage obligat ions and failed t o provide new disclosures; failed t o disclose t he am ount and nat ure of any kickback, reinsurance or ot her profit eering involving Bank of Am erica or t heir affiliat es based on t he purchase of t he force- placed insurance.” ( Dk. 1, ¶ 81) . Specifically, Hosler alleges t he forced- place insurance “ increased t he principal am ount due under t he 2 m ort gage and creat e [ sic] a new debt obligat ion subj ect t o disclosures under TI LA.” I d. at ¶ 82. Hosler also alleges t he Bank failed t o disclose com m issions and unearned profit s paid t o any affiliat e. I d. at ¶ 83. Finally, in ¶ 84, t he plaint iff alleges, “ [ a] ct s const it ut ing violat ions of TI LA are subj ect t o equit able t olling because Bank of Am erica’s kickback or ot her revenue- generat ing schem e was concealed from Hosler.” ( Dk. 1) . Dism iss for Failure t o St at e a Claim I n deciding a Rule 12( b) ( 6) m ot ion, a court accept s as t rue “ all well- pleaded fact ual allegat ions in a com plaint and view[ s] t hese allegat ions in t he light m ost favorable t o t he plaint iff.” Sm it h v. Unit ed St at es, 561 F.3d 1090, 1098 ( 10t h Cir.2009) , cert . denied, 130 S.Ct . 1148 ( 2010) . This dut y t o accept a com plaint 's allegat ions as t rue is t em pered by t he principle t hat “ m ere ‘labels and conclusions,' and ‘a form ulaic recit at ion of t he elem ent s of a cause of act ion’ will not suffice; a plaint iff m ust offer specific fact ual allegat ions t o support each claim .” Kansas Penn Gam ing, LLC v. Collins, 656 F.3d 1210, 1214 ( 10t h Cir. 2011) ( quot ing Bell At lant ic Corp. v. Tw om bly, 550 U.S. 544, 555 ( 2007) ) . As recent ly clarified by t he Suprem e Court , t he st andard under 12( b) ( 6) is t hat t o wit hst and a m ot ion t o dism iss, “ ’a com plaint m ust cont ain enough allegat ions of fact , t aken as t rue, t o st at e a claim t o relief t hat is plausible on it s face.'” Al–Owhali v. Holder, 687 F.3d 1236, 1239 ( 10t h Cir. 2012) ( quot ing Ashcroft v. I qbal, 556 U.S. 662, 678 ( 2009) ) . Thus, “ a plaint iff m ust offer sufficient fact ual allegat ions t o ‘raise a 3 right t o relief above t he speculat ive level.’” Kansas Penn Gam ing, 656 F.3d at 1214 ( quot ing Twom bly, 550 U.S. at 555) . “ The plausibilit y st andard is not akin t o a ‘probabilit y requirem ent ,’ but it asks for m ore t han a sheer possibilit y t hat a defendant has act ed unlawfully.” I qbal, 556 U.S. at 678 ( quot ing Twom bly, 550 U.S. at 556) . I t follows t hen t hat if t he “ com plaint pleads fact s t hat are ‘m erely consist ent wit h’ a defendant 's liabilit y it ‘st ops short of t he line bet ween possibilit y and plausibilit y of ‘ent it lem ent t o relief.’” I d. “ ‘A claim has facial plausibilit y when t he [ pleaded] fact ual cont ent . . . allows t he court t o draw t he reasonable inference t hat t he defendant is liable for t he m isconduct alleged.’” Rosenfield v. HSBC Bank, USA, 681 F.3d 1172, 1178 ( 10t h Cir. 2012) . “ Thus, in ruling on a m ot ion t o dism iss, a court should disregard all conclusory st at em ent s of law and consider whet her t he rem aining specific fact ual allegat ions, if assum ed t o be t rue, plausibly suggest t he defendant is liable.” Kansas Penn Gam ing, 656 F.3d at 1214. “ While t he st at ut e of lim it at ions is an affirm at ive defense, when t he dat es given in t he com plaint m ake clear t hat t he right sued upon has been ext inguished, t he plaint iff has t he burden of est ablishing a fact ual basis for t olling t he st at ut e.” Aldrich v. McCulloch Props., I nc., 627 F.2d 1036, 1041 n.4 ( 10t h Cir. 1980) . Thus, a st at ut e of lim it at ions issue m ay be resolved on a Rule 12( b) ( 6) m ot ion t o dism iss. See Glaser v. Cit y and Count y of Denver, Colo., 557 Fed. Appx. 689, 698 ( 10t h Cir.) , cert . denied, 135 S. Ct . 87 ( 2014) . 4 A TI LA act ion “ m ay be brought in an Unit ed St at es dist rict court , . . . , wit hin one year from t he dat e of t he occurrence of t he violat ion.” 15 U.S.C. § 1640( e) . “ Violat ion of t he TI LA ‘occurs at a specific t im e from which t he st at ut e will t hen run.’” Heil v. Wells Fargo Bank, N.A., 298 Fed. Appx. 703, 706 ( 10t h Cir. 2008) ( quot ing St evens v. Rock Springs Nat 'l Bank, 497 F.2d 307, 309 ( 10t h Cir.1974) ) . On t he issue of equit able t olling of a TI LA act ion, t he Tent h Circuit has indicat ed: “ ‘Equit able t olling’ is t he doct rine under which plaint iffs m ay sue aft er t he st at ut ory t im e period has expired if t hey have been prevent ed from doing so due t o inequit able circum st ances.” I d. [ Ellis v. Gen. Mot ors Accept ance Corp., 160 F.3d 703] at 706 [ ( 11t h Cir. 1998) ] ; see Moor v. Travelers I ns. Co., 784 F.2d 632, 633 ( 5t h Cir.1986) ( requiring plaint iff assert ing equit able t olling t o “ show t hat t he defendant s concealed t he reprobat ed conduct and despit e t he exercise of due diligence,he was unable t o discover t hat conduct ” ) ; see also Marsh v. Soares, 223 F.3d 1217, 1220 ( 10t h Cir.2000) ( “ [ E] quit able t olling ... is only available when [ lit igant s] diligent ly pursue [ t heir] claim s and dem onst rat e[ ] t hat t he failure t o t im ely file was caused by ext raordinary circum st ances beyond [ t heir] cont rol.” ) ( habeas corpus act ion) . The Heils bear t he burden of proving t hat t he lim it at ions period should be equit ably t olled. See Olson v. Fed. Mine Safet y & Healt h Review Com m 'n, 381 F.3d 1007, 1014 ( 10t h Cir.2004) . Heil, 298 Fed. Appx. at 706- 707. Applying t he doct rine of equit able t olling has been “ lim it ed t o ‘rare and except ional circum st ances.’” Dalt on v. Count rywide Hom e Loans, I nc., 828 F. Supp. 2d 1242, 1248 ( D. Colo. 2011) ( quot ing Garcia v. Shanks, 351 F.3d 468, 473 n.2 ( 10t h Cir. 2003) ) . “ For exam ple, t he equit able t olling of a st at ut e of lim it at ions m ay be t riggered where a plaint iff has act ively pursued his j udicial rem edies by filing a defect ive pleading during t he st at ut ory period or where a plaint iff has been 5 induced or t ricked by his adversary’s m isconduct int o allowing t he filing deadline t o pass.” Dalt on, 828 F. Supp. 2d at 2349 ( cit ing I rwin v. Dep’t of Vet erans Affairs, 498 U.S. 89, 96 ( 1990) ) . The plaint iff’s com plaint fails t o allege a sufficient fact ual basis for equit able t olling. Alleging no m ore t han t hat t he Bank concealed a “ kickback or ot her revenue- generat ing schem e,” Hosler fails t o allege how t his prevent ed him from suing wit hin t he st at ut ory period for failing t o disclose “ force- placed insurance” or failing t o disclose a connect ion bet ween t he Bank and t he insurer. There is not hing in t he com plaint showing t he plaint iff diligent ly pursued his claim s but ext raordinary circum st ances beyond his cont rol kept him from t im ely filing t he act ion. I n opposing dism issal, t he plaint iff alleges t hat , “ he believed t hat t he renewed paym ent s were being used t o pay t axes and insurance as well as covering his m ort gage” and t hat t he Bank’s failure t o advise him “ t hat his paym ent s did not cover t axes and insurance would be t he basis for a claim of fraudulent concealm ent of t he fact s.” ( Dk. 20, p. 4) . This allegat ion fares no bet t er. Nondislosure is not an allegat ion of inequit able circum st ances, for “ [ b] y definit ion, nondisclosure happens every t im e t here is a TI LA nondisclosure violat ion, and m ere violat ion of t he st at ut e cannot serve as ext raordinary circum st ances t hat m erit t olling.” Sam pson v. Washingt on Mut . Bank, 453 Fed. Appx. 863, 865 ( 11t h Cir. 2011) ; see Mat her v. First Hawaiian Bank, 2014 WL 2865851 at * 5 ( D. Haw. 2014) . There are no allegat ions here t hat 6 show t he plaint iff could not have discovered t he alleged violat ions upon exercising due diligence. Accordingly, Hosler’s TI LA claim against t he Bank is t im e- barred, and t he Bank’s m ot ion t o dism iss t his claim is grant ed. The Bank also seeks t o dism iss t he im plied covenant claim as t he plaint iff has failed t o allege what cont ract ual t erm was breached by t he defendant allegedly “ art ificially inflat ing prem ium s” and “ ot herwise disproport ionat ely benefit ing from t he force placed insurance.” ( Dk. 1, ¶ 78) . The Bank furt her challenges t hat it has not breached any im plied good fait h dut y under t he Kansas law governing lender relat ionships. The plaint iff only responds “ wit h agreeing t hat he needs t o am end t he claim on t he breach of t he im plied covenant of good fait h and fair dealing and seeks leave of court t o do following t he court ’s ruling” on t he Bank’s m ot ion. ( Dk. 20, p. 6) . I n reply, t he Bank argues an am endm ent would be fut ile as t he plaint iff cannot point t o any cont ract ual provision which would be im plicat ed for such a claim . The plaint iff essent ially concedes he has failed t o st at e an im plied covenant claim upon which relief can be grant ed. The plaint iff’s response of asking for leave in t his response is procedurally inappropriat e: Under Rule 15, court s “ should freely give leave [ t o am end] when j ust ice so requires.” Fed.R.Civ.P. 15( a) ( 2) . “ The liberal grant ing of m ot ions for leave t o am end reflect s t he basic policy t hat pleadings should enable a claim t o be heard on it s m erit s.” Calderon v. Kan. Dept . of Soc. & Rehab. Servs., 181 F.3d 1180, 1186 ( 10t h Cir. 1999) . But t his liberal policy is not wit hout lim it s. Rule 7 requires a request for relief t o be m ade by a m ot ion t hat ( 1) is in writ ing, ( 2) “ st at es wit h part icularit y t he grounds for seeking t he order,” and ( 3) specifies t he 7 relief sought . Fed.R.Civ.P. 7( b) ( 1) . “ We have recognized t he im port ance of Fed.R.Civ.P. 7( b) and have held t hat norm ally a court need not grant leave t o am end when a part y fails t o file a form al m ot ion.” Calderon, 181 F.3d at 1186. For exam ple, a bare request t o am end in response t o a m ot ion t o dism iss is insufficient t o place t he court and opposing part ies on not ice of t he plaint iff's request t o am end and t he part icular grounds upon which such a request would be based. Glenn v. First Nat 'l Bank in Grand Junct ion, 868 F.2d 368, 371 ( 10t h Cir. 1989) ; Calderon, 181 F.3d at 1185–87. Albers v. Board of Count y Com 'rs of Jefferson Count y, Colo., 771 F.3d 697, 706 ( 10t h Cir. 2014) . The plaint iff does not subm it argum ent s or a proposed com plaint t hat “ not ify t he court and opposing counsel of t he grounds for am endm ent .” I d; see D. Kan. Rule 15.1. Wit hout having any argum ent s or allegat ions on which t o det erm ine t he plaint iff’s request , t he court denies t he plaint iff leave t o am end. I T I S THEREFORE ORDERED t hat t he defendant Bank’s m ot ion t o dism iss ( Dk. 10) is grant ed on t he grounds st at ed above; I T I S FURTHER ORDERED t hat t he plaint iff’s request for leave t o file an am ended com plaint is denied. Dat ed t his 9t h day of January, 2015, Topeka, Kansas. s/ Sam A. Crow Sam A. Crow, U.S. Dist rict Senior Judge 8
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