Mejorado v. CitiMortgage, Inc., No. 2:2012cv00059 - Document 15 (E.D.N.C. 2013)
Court Description: ORDER denying 7 Motion to Dismiss for Failure to State a Claim. The clerk is directed to continue management of this case. Signed by Senior Judge Malcolm J. Howard on 6/17/2013. (Lee, L.)
Download PDF
<![CDATA[
Mejorado v. CitiMortgage, Inc. Doc. 15 IN THE UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF NORTH CAROLINA NORTHERN DIVISION No. 2:12-CV-59-H MARILYN MEJORADO, Plaintiff, v. ORDER CITIMORTGAGE, INC., and RICHARD P. MCNEELY, Substitute Trustee, Defendant. This matter plaintiff's defendant is before complaint CitiMortgage, for the court failure Inc. to on a state motion a ("CitiMortgageu). to claim dismiss filed Plaintiff by has responded, CitiMortgage has replied, and this matter is ripe for ruling. BACKGROUND On July 16, action seeking to 2012, plaintiff Marilyn Mejorado brought this prevent defendants home and also for monetary damages. from foreclosing on her The real property which is the subject of this action ("subject property") was purchased by plaintiff and her then-husband, Edward Livingston ("Livingston") in 1999. When the parties separated in 2002, Livingston was ordered through domestic court proceedings to provide plaintiff with a home in which she and her children would reside and to Dockets.Justia.com make the monthly mortgage payments on the home. 2002, In September Livingston obtained a loan in the amount of $81,400 from ABN AMRO Mortgage Group ("ABN AMRO"), the proceeds of which were used to purchase a mobile home that was placed on the subject property. In connection with the loan transaction, Livingston signed a note and deed of trust in favor of ABN AMRO providing the subject trust also property as purports security to be for signed the loan. The by plaintiff, deed of although plaintiff denies that she signed the deed of trust encumbering the subject property. Livingston ceased making payments on the loan in 2007, plaintiff began successor to ABN AMRO, she was directly communicating until 2008 when a Ci tiMortgage, Plaintiff alleges that about the loan. unaware of the deed of trust with and on the subject property judge in her domestic proceedings "suggested that she go to the Register of Deeds office to see if her property had been put up for collateral." (Compl. In September 2008, CitiMortgage c_j[ 15.) commenced foreclosure proceedings against the subject property in Bertie County, North Plaintiff contested foreclosure of the property, Carolina. an order allowing the foreclosure was entered County Clerk of Court on November 18, 2008. the Clerk's appeal, order plaintiff to the filed Bertie a County memorandum 2 by the but Bertie Plaintiff appealed Superior in Court. opposition On to foreclosure. Specifically, plaintiff argued that Ci tiMortgage has not proven the existence of "a proper security instrument evidencing the debt that permits the foreclosure" purported signature on the deed of trust is a Dismiss Ex. H [DE #7-8] at 1.) because her forgery. Plaintiff's appeal (Mot. of the foreclosure proceedings is still pending with the Bertie County Superior Court. In 2009 and 2010, plaintiff and CitiMortgage additional loss mitigation discussions, into an agreed Interim to Forbearance "suspend any in and the parties entered Agreement scheduled engaged whereby foreclosure CitiMortgage sale" while plaintiff was being reviewed for a loan modification plan under the federal government's Home Affordable Modification Program. Apparently the parties did not enter into a loan modification plan, indicated although the reason for that is not in the record. Following plaintiff's appeal of the Bertie County Clerk's order allowing foreclosure, 16' 2012, Carolina. in the plaintiff filed this action on July Superior Court of Bertie County, North CitiMortgage removed the action to this court based on diversity jurisdiction and now moves to dismiss plaintiff's 3 claims for failure to state a claim upon which relief can be granted. 1 COURT'S DISCUSSION I. Standard of Review A motion to dismiss under Rule 12 (b) ( 6) of the Federal Rules of Civil Procedure tests the legal and factual sufficiency of a complaint. Ashcroft v. Iqbal, 556 U.S. 662, Edwards v. City of Goldsboro, 178 F.3d 231, 243 678-79 (2009); (4th Cir. 1999). A federal district court confronted with a motion to dismiss for failure to state a claim must accept the plaintiff's allegations as true and construe the allegations of the light most favorable to the plaintiff. States, 120 F.3d 472, motion "'does merits of a not claim, 474 (4th Cir. resolve contests or the supported Ibarra v. United A Rule 12(b) (6) surrounding the of facts, defenses.'" 980 F.2d 943, 952 by showing any set of facts consistent the Id. (4th Cir. it may be with Bell Atlantic Corp. v. the Twombly, u.s. 544, 563 (2007). "[A] or in the "[O]nce a claim has been stated adequately, allegations in the complaint." 550 1997). applicability (quoting Republican Party v. Martin, 1992)). See complaint complaint need not 'make a case' against a defendant 'forecast evidence sufficient to prove an element' 1 of the Defendant Richard P. McNeely does not appear to have been served in this matter and has not made an appearance in the case. 4 claim." Chao v. Cir. 2005) (4th Cir. (quoting Iodice v. 2002)). unadorned, Iqbal, Rivendell Woods, U.S. at complaint must true, 'state face.'" not Id. United States, it must 678. contain a "To survive provide sufficient claim to a motion factual relief more is as conclusions allegations. legal to "an a accepted as on its The court need couched as factual Twombly, 550 U.S. at 555. Count I - Deter-mination of Lien Status and Removal of Cloud From Title Plaintiff filed complaint Recoupment 21.34) ." (pursuant favor that her N.C. G. S. § in 4 5- [DE # 1- of plaintiff's complaint is a claim seeking to quiet title to the_subject property. alleges to and (Mot. TRO & Prel. Injunction & Verified Compl. Count I Foreclosure "in Defense at 2.) of her Equitable 2] 281 dismiss, plausible 550 U.S. at 570). true than (4th accusation." matter, that 349 289 F.3d 270, (quoting Twombly, accept II. 415 F.3d 342, the-defendant-unlawfully-harmed-me 556 to However, Inc., purported of ABN AMRO is a signature Specifically, plaintiff on forgery and that therefore a cloud upon her title. the deed of trust in the deed of trust is Plaintiff prays for an order removing the cloud on her title by striking the deed of trust from the land records Register of Deeds. in (Compl. the ~~ Office 25-28.) 5 of the Bertie County CitiMortgage moves to dismiss Count I for failure to state a claim on two separate grounds. First, it argues claim is barred by the statute of limitations. CitiMortgage validity contends of the debt that plaintiff outside of may the that the Additionally, not challenge foreclosure the proceeding. This court disagrees and therefore denies CitiMortgage's motion to dismiss Count I. CitiMortgage argues that the limitations provided in N.C. plaintiff's claims because plaintiff grounds of fraud. Gen. three-year Stat. is § statute 1-52 (9) of applies to seeking relief on the While the court acknowledges that appears to be the appropriate statute of limitations, 1-52(9) § the North Carolina courts have held that the statute of limitations does not run against a plaintiff seeking to quiet title while he is in possession Inc., 338 of the property. S.E.2d Oates v. Nelson, with approval in 817, 819-20 Poore v. (N.C. Ct. Swan Quarter App. 269 C.A.2d 18, 74 Cal. Rptr. Poore, 338 S.E.2d 817. As 1986); 475 the Farms, see (1969), cited Poore noted: The purpose of a Statute of Limitations is to put an end to stale claims, not to compel resort to the courts to vindicate rights which have not been and might never be called into question. The requirement of prompt action is imposed as a policy matter upon persons who would challenge title to property rather than those who seek to quiet title to their land. 6 also court Poore, 338 Philwood S.E.2d at Estates, 820 418 (quoting Orange N.E.2d 1310, Rockland Util. & 1313 (N.Y. 1981)). v. As plaintiff has been in possession of the subject property at all times relevant to this action, no statute of limitations has begun running against her claim to quiet title to the property. The court is also aware of no authority that would operate to bar plaintiff from challenging the validity of the debt outside of the foreclosure proceeding before the clerk of court. Plaintiff was certainly entitled to (and in this case did) raise the issue of the validity of the debt before the clerk of court and on appeal from proceeding, plaintiff litigating such judgment 271, has therefore, not apply. 280-81 been res may issues collateral estoppel. F. 3d clerk of court's order allowing Upon entry of a final judgment in the foreclosure foreclosure. 678 the well by be foreclosed principles See Gilbert v. (4th entered Cir. in the of from res judicata Residential 2012). judicata and collateral no proceeding estoppel or Funding LLC, However, foreclosure further final and, principles do Id. As a consequence, plaintiff was not precluded from bringing a separate state-court action to quiet title to her property. specifically In authorizes fact, a North property action to enjoin foreclosure. ("Any owner of real estate Carolina owner See N.C. . statutory to bring a separate Gen. Stat. § 45-21.34 . may apply to a 7 law judge of the superior court any to enjoin [a foreclosure] sale . upon legal or equitable ground which the court may deem sufficient.") Had the action remained in the Superior Court of Bertie County, it may have been that the court consolidated the actions appropriate. to be However, Ci tiMortgage removed the quiet title action to this court and will not now be permitted to complain of the dual jurisdiction it created. III. Counts II & III - Breach of Loan Servicing Duties & Implied Covenant of Good Faith and Fair Dealing Ci tiMortgage next moves to dismiss plaintiff's claims for breach of loan servicing duties and breach of the covenant of good faith and fair In dealing. these claims, plaintiff essentially asserts that CitiMortgage breached its duties under its forbearance agreement with plaintiff. that plaintiff's breach of loan CitiMortgage contends servicing duties claim is subject to dismissal because plaintiff has not "identif[ied] any term of the Forbearance Agreement which was breached and [p]laintiff cannot claim that she was owed any duty of care by CitiMortgage." plaintiff's claim, (Mem. implied Supp. covenant Mot. of Dismiss good faith at and 14.) fair As to dealing CitiMortgage argues that dismissal is warranted because plaintiff's allegations that CitiMortgage failed to comply "with the express terms of the Interim Forbearance Agreement is a pure 8 breach of contract claim that duty of good faith claim." cannot be stated as an implied (Mem. Supp. Mot. Dismiss at 17.) Plaintiff's claims for breach of loan servicing duties and implied covenant of good faith and fair dealing adequately state a claim for breach of the forbearance agreement. Plaintiff has not, however, stated any facts that would support a separate and distinct tort claim for breach of the covenant of good faith and fair dealing. North Carolina recognizes an implied covenant of good faith and fair dealing in every contract, ensuring that one party will not injure or interfere with the other's right to receive the benefit of the agreement. Bicycle Transit Auth., 333 S.E.2d 299, 305 (1985). and fair dealing is breach of claim that for breach "Because the covenant of good faith implied in a covenant of is Ada Liss Group v. a Sara Lee Apr. 27, "[I]n most cases a breach of the covenant [of good faith is simply another way of stating a claim for breach of contract. breached the case (M.D.N.C. of 2010). the 3910433 and parcel' No. In WL 'part claim for Corp., and fair dealing] 2010 a contract typically contract." 1:06-CV-610, Inc. v. Bell, Id. at covenant bar, of plaintiff good faith alleges and that fair Ci tiMortgage dealing by ( 1) "failing to service Plaintiff's account in accordance with the terms of the Forbearance Agreement"; 9 (2) "failing to supervise its agents and employees including, without limitation, its loss mitigation, proceed and with collection foreclosure personnel, who proceedings were after instructed to [f]orbearance a agreement was formed to resolve the mortgage account issues with the Plaintiff"; and benefit bargain." of her (3) "failing to provide Plaintiff with the (Compl. These 38.) <J[ sufficiently state a breach of contract and will, allegations therefore, be construed as such. IV. Count IV - Unfair or Deceptive Trade Practices CitiMortgage further contends that plaintiff has failed to allege any fraudulent or deceptive acts by CitiMortgage to support her unfair or deceptive trade practices claim. There are three practices elements under to North a claim of Carolina's unfair Unfair Practices Act, N.C. Gen. Stat. § 75-1.1 et or deceptive competition, act or practice, or or deceptive trade and Deceptive Trade ~: an ( 2) in or affecting commerce, "(1) an unfair unfair method ( 3) which proximately caused actual injury to the plaintiff or his business." Leasing, 476, 482 that (i) Inc. v. Pollard, 101 N.C. App. (1991). In support of her 450, claim, 460-61, Spartan 400 S.E.2d plaintiff alleges CitiMortgage refused on more than one occasion to deal with plaintiff or provide her with information about even of after CitiMortgage, she (ii) entered into a forbearance the agreement loan with in 2007 CitiMortgage told plaintiff that the 10 mobile home would foreclosure of be removed subject the from her property property, in (iii) lieu of CitiMortgage attempted to collect from plaintiff a delinquency for which she was not responsible, (iv) plaintiff for insurance, the credit bureaus responsible, ability to sought to for maintain the foreclose invalid deed allegations of (v) (vi) and trust. a forbearance the court, for therefore, unfair rej~cts not which agreement charged borne out not ultimately based While by is plaintiff's and property <J[<JI13-22.) be she undermined subject (Compl. ultimately may claim for CitiMortgage upon wrongfully CitiMortgage reported plaintiff to arrearages revealed through discovery, state CitiMortgage upon an plaintiff's the facts as they are nevertheless sufficient to or deceptive trade practices. The CitiMortgage's motion to dismiss this claim. CONCLUSION For the foregoing reasons, CitiMortgage's motion to dismiss [DE #7] is DENIED. The clerk is directed to continue management of this case. This /7 ttday of June 2013. At Greenville, NC #31 11
]]>
Some case metadata and case summaries were written with the help of AI, which can produce inaccuracies. You
should read the full case before relying on it for legal research purposes.
This site is protected by reCAPTCHA and the Google
Privacy Policy and
Terms of Service apply.
