Hua v. Wells Fargo Bank, National Association, as Trustee for Morgan Stanley ABS Capital I Inc. Trust 2006-WMC1, Mortgage Pass-Through Certificates, Series 2006-WMC1, No. 4:2014cv02427 - Document 8 (S.D. Tex. 2014)

Court Description: MEMORANDUM AND ORDER Granting 7 MOTION TO DISMISS FOR FAILURE TO STATE A CLAIM (Signed by Judge Ewing Werlein, Jr) Parties notified.(gkelner, 4)

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Hua v. Wells Fargo Bank, National Association, as Trustee ...-Through Certificates, Series 2006-WMC1 Doc. 8 IN THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF TEXAS HOUSTON DIVISION EDWARD HUA, Plaintiff, v. WELLS FARGO BANK, NATIONAL ASSOCIATION, as Trustee for Morgan Stanley ABS Capital I Inc. Trust 2006-WMC1, Mortgage Pass-Through Certificates, Series 2006-WMC1, Defendant. § § § § § § § § § § § § § § CIVIL ACTION NO. H-14-2427 MEMORANDUM & ORDER Pending is Defendant's Motion to Dismiss Plaintiff's First Amended Complaint (Document No.7). 1 Plaintiff has filed no response, and the motion is therefore deemed unopposed pursuant to Local Rule 7.4. After carefully considering the motion and applicable law, the Court concludes the motion should be granted. I. Plaintiff Edward Hua Background ("Plaintiff") purchased a home at 904 Reinerman Street, Houston, Texas 77007 (the "Property") on or about September 20, 2005. 2 Plaintiff alleges that he executed a Note and 1 Also pending is Defendant's Motion to Dismiss (Document No.4), which is superceded by the present motion and is therefore denied as moot. 2 Document No. 6 ~~ 4-5 (1st Am. Compl.). Dockets.Justia.com Deed of Trust on the Property with "Wells Fargo Bank, N.A." as lender, and Mortgage Electronic Registration Systems, Inc. ("MERS") as a beneficiary.3 Defendant Wells Fargo Bank, National Associa- tion, as Trustee for Morgan Stanley ABS Capital I Inc. Trust 2006WMC1, Mortgage ("Defendant") 4 Pass-Through Certificates, Series 2006-WMC1 exhibits a Deed of Trust for the Property (the "Deed of Trust"), dated September 20, 2005 and signed by Plaintiff, which identifies WMC Mortgage Corporation as the lender and MERS as a beneficiary. 5 Plaintiff does not dispute that this is the Deed of Trust he signed, and the parties agree that now Defendant is the lender and mortgagee of the Property. Plaintiff alleges difficulties and, that he began to experience financial in an effort to remedy the situation, entered into debt restructuring negotiations with Ocwen Loan Servicing, LLC ( "Ocwen" ), Defendant's loan servicer, conditions of the Note. 6 loan modification and 3 Id. ~ to modify the terms and Plaintiff alleges that he was offered a that during the next several months he 5. 4 Defendant explains that it was incorrectly named as "Wells Fargo Bank, N.A." Document No.1 at 1 n.1. 5 Document No. 7-1. "Documents that a defendant attaches to a motion to dismiss are considered part of the pleadings if they are referred to in the plaintiff's complaint and are central to her claim." Causey v. Sewell Cadillac-Chevrolet, Inc., 394 F.3d 285, 288 (5th Cir. 2004). 6 Document No. 6 ~ 7. 2 obtained and submitted financial documents in response to Ocwen's requests. 7 Plaintiff further alleges that Ocwen's representatives informed him "that he was not allowed to make any mortgage payments while in loan modification status," and "that [Defendant] would not take any action to foreclose modification status."s on the Property while in loan Plaintiff alleges that "Ocwen's representa- tives informed the Plaintiff not to [make any payments] because she guaranteed them that he would get his loan modified," "Ocwen's representatives promised that they were and that drafting an agreement contemporaneously with the conversation to memorialize the agreed-upon terms," but that Plaintiff never received a written agreement. 9 Plaintiff alleges that while he was waiting for confirmation of the loan modification, he was served with a Suit to Evict filed by Defendant. 10 On August 22, 2014, Plaintiff sued Defendant in state court, alleging that Defendant wrongly conducted a foreclosure sale of the Property on August 7, 2012, in which Defendant sold the Property to itself.l1 After Defendant removed the suit, Plaintiff filed a First Amended Complaint, 7 Id. S Id. 8. ~ causes 9. Id. 9 ~ alleging 10 Id. 11 Document No. 1-2. 3 of action for breach of contract, common law fraud, and promissory estoppel. 12 Defendant now moves to dismiss Plaintiff's First Amended Petition.13 II. Legal Standard Rule 12 (b) (6) provides for dismissal of an action for "failure to state a claim upon which relief can be granted. P. 12(b) (6). 11 FED. R. Crv. When a district court reviews the sufficiency of a complaint before it receives any evidence either by affidavit or admission, its task is inevitably a limited one. See Scheuer v. Rhodes, 94 S. Ct. 1683, 1686 (1974), abrogated on other grounds by Harlow v. Fitzgerald, 102 S. Ct. 2727 (1982). whether the plaintiff ultimately will prevail, The issue is not but whether the plaintiff is entitled to offer evidence to support the claims. Id. In considering a motion to dismiss under Rule 12(b) (6), the district court must construe the allegations in the complaint favorably to the pleader and must accept as true all well-pleaded facts 117 in F.3d the 242, complaint. 247 See (5th Cir. Lowrey v. 1997). To Tex. A&M Uni v . survive Sys . , dismissal, a complaint must plead "enough facts to state a claim to relief that is plausible on its face." 1955, 1974 (2007). Bell Atl. Corp. v. Twombly, 127 S. Ct. "A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the 12 Document No.6. 13 Document NO.7. 4 reasonable inference misconduct alleged. (2009). While a allegations . . that the defendant Ashcroft v. II complaint "does not liable 129 S. Iqbal, is Ct. need for 1937, detailed the 1949 factual [the] allegations must be enough to raise a right to relief above the speculative level, on the assumption that all the allegations in the complaint are true fact) . Twombly, /I 127 S. Ct. at 1964-65 (even if doubtful in (citations and internal footnote omitted) . III. A. Analysis Breach of Contract Plaintiff alleges that Defendant's actions constitute a breach of contract because "[Defendant] with the Plaintiff whereby action to foreclose on entered into an oral agreement [Defendant] his Property promised not to take any while they resolved the situation and [Defendant] breached that agreement by selling the Property at a foreclosure sale which caused [Plaintiff's] injury. 1/14 "An agreement to delay foreclosure is subject to the Texas statute of frauds, and, accordingly, must be in writing to be enforceable./1 Milton v. 2013) u.s. Bank Nat. Ass'n, 508 F. App'x 326, 328-29 (5th Cir. (citations agreement 14 omitted) ("[B]ecause Document No. 6 ~ 12. 5 no written plaintiff's breach of to delay foreclosure, there was contract claim is barred by the statute of frauds."). Accordingly, Plaintiff's breach of contract claim is dismissed. B. Common Law Fraud Plaintiff's " [Defendant] fraud made claim false is and based material on the allegation that misrepresentations to [Plaintiff] when informing [Plaintiff] that they would not take any action to foreclose on his resolved the situation."15 Property while they researched and "When tort claims have their nucleus in an alleged oral contract which is unenforceable under the statute of frauds, Foster v. the statute of frauds bars the tort claims as well." Bank One Texas NA, (quoting Maginn v. 54 F. Norwest Mortgage, (Tex. App.-Austin 1996, no writ)). App'x 592 Inc., (5th Cir. 2002) 919 S.W.2d 164, 169 Because Plaintiff's fraud claim arises out of the same unenforceable alleged oral contract that forms the basis of his breach of contract claim, his fraud claim is also barred by the statute of frauds. Furthermore, Plaintiff's fraud claim is barred by the economic loss rule. (Tex. See Sw. Bell Tel. Co. v. DeLanney, 809 S.W.2d 493, 495 1991) ("When the injury is only the economic loss to the subject of a contract itself the action sounds in contract alone.") (citation omitted) i Mem' 1 Eurocopter Deutschland, GMBH, 15 Id. ~ Hermann Healthcare 524 F.3d 676, 14. 6 678 Sys. Inc. (5th Cir. v. 2008) (UUnder Texas's economic loss rule, when plaintiffs have . no duty in tort exists suffered only economic losses.") (citing Hou-Tex, Inc. v. Landmark Graphics, 26 S.W.3d 103, 107 (Tex. App.Houston [1st Dist.] 2000)); Gonzales v. Bank of Am., N.A., CIV.A. G-12-292, 2013 (Froeschner, economic WL 140093, M.J.) loss at *2 (dismissing rule where (S.D. Tex. homeowners' U[p] laintiffs Jan. fraud have not 10, 2013) claim under alleged any independent injury outside the economic losses caused by BOA's alleged breach of the contract"). Plaintiff's fraud claim is therefore dismissed. C. promissory Estoppel Plaintiff alleges that U[t] he actions committed by [Defendant] constitute promissory estoppel because: A. [Defendant] made a promise to [Plaintiff]; B. [Plaintiff] reasonably and substantially relied on the promise to her detriment; C. was foreseeable by [Defendant]; and D. Injustice can be avoided only by enforcing [Defendant's] promise.,,16 years, to a claimant enforceable contract." only in U[f]or many Sambuca Houston, 16 Id. ~ the absence of a valid and Tremble v. Wells Fargo Home Mortgage, Inc., 478 F. App'x 164, 166 (5th Cir. 2012) v. However, Texas courts have held that promissory estoppel becomes available L.P. [Plaintiff's] reliance L.P., (quoting Doctors HOsp. 1997, 154 S.W.3d 634, 16. 7 636 (Tex. App.- Houston [14th Dist.] 2004, pet. abated) (collecting cases)) (rejecting argument that promissory estoppel prevents foreclosure where plaintiff did enforceable contract). not dispute that mortgage was valid and Plaintiff acknowledges the existence of the Deed of Trust and does not allege any facts that call into question its validity or enforceability. Accordingly, Plaintiff's promissory estoppel claim is dismissed. IV. Order For the foregoing reasons, it is ORDERED that Defendant's Motion to Dismiss Plaintiff's First Amended Complaint (Document No.7) is GRANTED and Plaintiff Edward Hua's claims are DISMISSED with prejudice. The Clerk will enter this Order, providing a correct copy to all parties of record. SIGNED at Houston, Texas, on this ~ ~ aay of November, 2014. G WERLEIN, JR. ATES DISTRICT JUDGE 8

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