-VCF Hackett, Jr. et al v. OneWest Bank FSB et al, No. 2:2012cv01031 - Document 19 (D. Nev. 2012)
Court Description: ORDER Granting in part and Denying in part 6 Motion to Dismiss. IT IS FURTHER ORDERED that 10 Motion to Dismiss is DENIED. Signed by Judge Miranda M. Du on 12/3/12. (Copies have been distributed pursuant to the NEF - EDS)
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-VCF Hackett, Jr. et al v. OneWest Bank FSB et al Doc. 19 1 2 3 4 5 UNITED STATES DISTRICT COURT 6 DISTRICT OF NEVADA 7 *** 8 9 DONALD S. HACKETT, JR. and JENNIE HACKETT, 10 Plaintiffs, 11 12 13 14 v. ONEWEST BANK FSB; MTC FINANCIAL, dba TRUSTEE CORPS, MAVERICK VALLEY PROPERTIES, LLC.; and DOES 1-10, inclusive, Case No. 2:12-cv-01031-MMD-VCF ORDER (Def. MTC’s Motion to Dismiss Claims 1, 2, and 4; Def. OneWest’s Motion to Dismiss – dkt. nos. 6, 10). Defendants. 15 16 17 I. SUMMARY 18 Before the Court is Defendant MTC Financial Inc. dba Trustee Corps’ (“MTC”) 19 Motion to Dismiss Complaint as to the First, Second, and Fourth Claims against MTC. 20 (Dkt. no. 6.) Also before the Court is Defendant OneWest Bank’s (“OneWest”) Motion to 21 Dismiss the Complaint against OneWest. (Dkt. no. 10.) For the reasons discussed 22 below, MTC’s motion is granted in part and denied in part and OneWest’s motion is 23 denied. 24 II. 25 26 BACKGROUND This case arises from an alleged wrongful foreclosure. Plaintiffs’ Complaint alleges the following facts: 27 In December 2006, Plaintiffs executed a Note secured by a Deed of Trust (“DOT”) 28 in favor of IndyMac Bank, FSB (“Lender”) for the purchase of real property at 3825 Dockets.Justia.com 1 Bowers Hollow Avenue, North Las Vegas, Nevada 89085 (“Property”). 1 The recorded 2 DOT identified IndyMac Bank FSB as the lender, Commerce Title Insurance Company 3 (“Commerce”) as the Trustee, and MERS as the beneficiary. 4 OneWest and MTC recorded a document purporting to replace Commerce with MTC as 5 the substituted trustee. On December 22, 2010, MTC recorded a Notice of Default and 6 Election to Sell under Deed of Trust. 7 Assignment of the Deed of Trust assigning all interests in the DOT to OneWest. On 8 August 30, 2011, OneWest recorded a Substitution of Trustee naming MTC as trustee 9 under the DOT. On January 26, 2012, MTC recorded the Notice of Trustee’s Sale and 10 on March 20, 2012, a Trustee’s Deed Upon Sale was recorded in favor of Maverick 11 Valley Properties, LLC (“Maverick”). 12 proceedings against Plaintiffs. On July 15, 2009, On January 18, 2011, MERS recorded an On April 12, 2012, Maverick instituted eviction 13 Plaintiffs allege that OneWest was not a beneficiary under the DOT, MTC was not 14 a legally appointed substituted trustee, and therefore, neither OneWest nor MTC had the 15 power of sale. As neither had the power of sale, the Trustee’s Sale was void and 16 Maverick never gained any interest in the Property. Furthermore, Plaintiffs allege that 17 they were not in default or failed in performance under the Note or Deed of Trust and 18 therefore any foreclosure was unwarranted and wrongful. 19 Plaintiffs filed the instant action in the Eighth Judicial District for the State of 20 Nevada asserting four claims: (1) wrongful foreclosure against OneWest and MTC, (2) 21 cancel corrective trustee’s deed upon sale against OneWest and MTC, (3) quiet title 22 23 24 25 26 27 28 1 The Court takes judicial notice of attached copies of relevant publicly recorded documents. See Disabled Rights Action Comm. v. Las Vegas Events, Inc., 375 F.3d 861, 866 n. 1 (9th Cir. 2004) (the court may take judicial notice of the records of state agencies and other undisputed matters of public record under Fed. R. Evid. 201). Thus, the Court takes judicial notice of: (1) the grant, bargain, and sale deed recorded on December 22, 2006, (2) the deed of trust recorded on December 22, 2006, (3) the substitution of trustee recorded on July 15, 2009, (4) the notice of default and election to sell under deed of trust recorded on October 22, 2010, (5) an assignment of the deed of trust recorded on January 18, 2011, (6) the notice of trustee’s sale recorded on January 26, 2012, and a trustee’s deed upon sale recorded on March 20, 2012. 2 1 against Maverick, and (4) deceptive trade practices against MTC. MTC removed the 2 case to this Court pursuant to diversity jurisdiction. Defendants OneWest and MTC 3 move to dismiss the complaint for failure to state a claim. 4 III. DISCUSSION 5 A. 6 A court may dismiss a plaintiff’s complaint for “failure to state a claim upon which 7 relief can be granted.” Fed. R. Civ. P. 12(b)(6). A properly pled complaint must provide 8 “a short and plain statement of the claim showing that the pleader is entitled to relief.” 9 Fed. R. Civ. P. 8(a)(2); Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555 (2007). While 10 Rule 8 does not require detailed factual allegations, it demands “more than labels and 11 conclusions” or a “formulaic recitation of the elements of a cause of action.” Twombly, 12 550 U.S. at 555 (citing Papasan v. Allain, 478 U.S. 265, 286 (1986). “Factual allegations 13 must be enough to rise above the speculative level.” Id. Thus, to survive a motion to 14 dismiss, a complaint must contain sufficient factual matter to “state a claim to relief that 15 is plausible on its face.” Id. at 570. 16 Legal Standard In Ashcroft v. Iqbal, 556 U.S. 662 (2009), the Supreme Court clarified the two-step 17 approach district courts are to apply when considering motions to dismiss. 18 district court must accept as true all well-pled factual allegations in the complaint; 19 however, legal conclusions are not entitled to the assumption of truth. Id. at 679. Mere 20 recitals of the elements of a cause of action, supported only by conclusory statements, 21 do not suffice. Id. at 678. Second, a district court must consider whether the factual 22 allegations in the complaint allege a plausible claim for relief. Id. at 679. A claim is 23 facially plausible when the plaintiff’s complaint alleges facts that allow the court to draw a 24 reasonable inference that the defendant is liable for the alleged misconduct. Id. at 678. 25 Where the complaint does not permit the court to infer more than the mere possibility of 26 misconduct, the complaint has “alleged but not shown that the pleader is entitled to 27 relief.” Id. at 679 (internal quotation marks omitted). When the claims in a complaint 28 have not crossed the line from conceivable to plausible, plaintiff’s complaint must be 3 First, a 1 dismissed. Twombly, 550 U.S. at 570. A complaint must contain either direct or 2 inferential allegations concerning “all the material elements necessary to sustain 3 recovery under some viable legal theory.” 4 Carriers, Inc. v. Ford Motor Co., 745 F.2d 1101, 1106 (7th Cir. 1989) (emphasis in 5 original)). The Court also notes the well-established rule that pro se complaints are 6 subject to “less stringent standards than formal pleadings drafted by lawyers” and should 7 be “liberally construed.” Erickson v. Pardus, 551 U.S. 89, 94 (2007) (citation omitted). Twombly, 550 U.S. at 562 (quoting Car 8 B. Analysis 9 MTC and OneWest move for dismissal based on failure to state a claim. MTC 10 argues that any claim against MTC is barred by the “agent’s immunity rule.” 11 Alternatively, MTC argues it has substantially complied with Nevada foreclosure statutes 12 and that MTC had a Nevada business license during the period in question. MTC and 13 OneWest both argue that Plaintiffs’ claims fail because Plaintiffs cannot tender the 14 undisputed amount to prevail on a wrongful foreclosure claim. 15 Initially, the Court rejects MTC’s argument that it is shielded by the “agent’s 16 immunity rule.” The agent’s immunity rule is merely an extension of the intracorporate 17 immunity doctrine. The agent’s immunity rule is based on the proposition that an agent, 18 acting within the scope of his authority, is one and the same “person” as the corporation 19 and a corporation cannot conspire with itself. Black v. Bank of America, 30 Cal.App.4th 20 1, 4-6 (Cal. App. 1. Dist. 1994). Therefore, an agent cannot be jointly sued with the 21 corporation under a conspiracy legal theory. 22 misplaced because Plaintiffs have not alleged any conspiracy based claims. The Court 23 turns its analysis to each claim in turn. 1. 24 MTC’s reliance on this doctrine is Claim 1 – Wrongful Foreclosure 25 Plaintiffs allege wrongful foreclosure under NRS 107.080. Plaintiffs allege that 26 neither OneWest, nor MTC, had the right to file the Notice of Default, and that they were 27 not in default. 28 /// 4 1 Under Nevada law, to succeed on a claim of wrongful foreclosure a plaintiff must 2 show that a lender wrongfully exercised the power of sale and foreclosed upon his or her 3 property when the homeowner was not in default on the mortgage loan. See Collins v. 4 Union Federal Sav. & Loan Ass’n, 662 P.2d 610, 623 (Nev. 1983). The central question 5 is “whether the trustor was in default when the power of sale was exercised.” 6 Contrary to both MTC and OneWest’s arguments, Plaintiffs need only allege that they 7 were not in default on their loan obligations when Defendants initiated the foreclosure 8 proceedings. Assuming the facts in the Complaint as true, Plaintiffs have adequately 9 alleged they were not in default2 and therefore, OneWest, or MTC as its agent, should 10 not have exercised the power of sale. This factual allegation in and of itself precludes 11 dismissal of this claim. 2. 12 Id. Claim 2 – Cancel Trustee’s Deed Upon Sale 13 Plaintiff’s claim for cancellation of the Trustee’s Deed Upon Sale is dismissed with 14 prejudice as it is merely a form of relief and not a cause of action. However, should 15 Plaintiffs prevail on their claim for wrongful foreclosure, voiding the trustee sale would be 16 an appropriate remedy. Berilo v. HSBC Mortg. Corp., USA, No. 2:09-cv-02353-RLH- 17 PAL, 2010 WL 2667218 and *3 (D. Nev. June 29, 2010). 3. 18 Claim 4 – Deceptive Trade Practices 19 Plaintiffs allege MTC is illegally conducting business in Nevada without all 20 required licensing. Plaintiff acknowledges that while MTC may be exempt under NRS 21 Chapter 80.015(1)(h), MTC should not be entitled to de facto exemption from the 22 licensing requirements of NRS Chapter 76. 23 Under Nevada law, conducting business without all required state, county or city 24 licenses amounts to a deceptive trade practice. NRS § 598.0923(1), (3). However, 25 Plaintiffs’ claim fails because judicially noticed public records show that MTC was 26 27 28 MTC takes exception with Plaintiffs’ use of the words “are informed and believe.” However, applying the liberal pleading standard and the less stringent standards on pro se complaints, Plaintiffs have at least inferentially alleged they were not in default. 2 5 1 licensed during the relevant time-period.3 Thus, the Court dismisses Plaintiffs’ fourth 2 claim without leave to amend. 3 IV. CONCLUSION 4 IT IS THEREFORE ORDERED that Defendant MTC’s Motion to Dismiss 5 Complaint as to the First, Second, and Fourth Claims (dkt. no. 6.) is GRANTED in part, 6 and DENIED in part. 7 8 IT IS FURTHER ORDERED that Defendant OneWest’s Motion to Dismiss the Complaint against OneWest (dkt. no. 10) is DENIED. 9 10 DATED THIS 3rd day of December 2012. 11 12 MIRANDA M. DU UNITED STATES DISTRICT JUDGE 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 3 As explained above, the Court may take judicial notice of the records of state agencies. Here, the Court takes judicial notice of MTC’s foreign corporation business license on the Nevada Secretary of State business entity search website, available at https://nvsos.gov/sosentitysearch/. 6
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