Clower v. Le Jardin at Baytowne Wharf Condo. Ass'n, Inc. (In re Clower)

• Decision Date: 29 August 2011
• Docket Number: Adversary No. 11–1021–whd.,Bankruptcy No. 09–12184–WHD.
• Citation: 463 B.R. 573
• Parties: In the Matter of Thomas Barry CLOWER, Leslie S. Clower, Debtors.Leslie S. Clower, Plaintiff, v. Le Jardin at Baytowne Wharf Condominium Association, Inc., Defendant.
• Court: U.S. Bankruptcy Court — Northern District of Georgia

463 B.R. 573

In the Matter of Thomas Barry CLOWER, Leslie S. Clower, Debtors.Leslie S. Clower, Plaintiff,

v.Le Jardin at Baytowne Wharf Condominium Association, Inc., Defendant.

Bankruptcy No. 09–12184–WHD.

Adversary No. 11–1021–whd.

United States Bankruptcy Court, N.D. Georgia, Newnan Division.

Aug. 29, 2011.

William Russell Patterson, Ragsdale Beals Seigler Patterson & Gray, Atlanta, GA, for Debtors.

ORDER

W.H. DRAKE, Bankruptcy Judge.

Before the Court is a Motion to Dismiss Complaint, filed by Le Jardin at Baytowne Wharf Condominium Association, Inc. (hereinafter the “Defendant”). The motion arises in connection with a complaint for damages for a violation of the automatic stay and a request for injunctive relief, filed by Leslie S. Clower (hereinafter the “Plaintiff”). The Plaintiff opposes the dismissal of the Complaint. This matter constitutes a core proceeding, over which this Court has subject matter jurisdiction. See 28 U.S.C. § 157(b)(1)(A); § 1334.

Procedural History and Facts

The Plaintiff filed a voluntary petition under Chapter 7 of the Bankruptcy Code on June 23, 2009. At that time, the Plaintiff owned a condominium unit at Le Jardin Condominium in Walton County, Florida (hereinafter the “Unit”), which was the subject of a foreclosure action brought by Wachovia Mortgage Corporation (hereinafter “Wachovia”) in Walton County (hereinafter the “Foreclosure Action”) on May 28, 2009. Wachovia filed an unopposed motion for relief from the automatic stay in the Plaintiff's main bankruptcy case (09–12184–whd), and the Court entered a consent order granting such relief on September 15, 2009 (Docket Number 40). The Motion requested the Unit be abandoned as property of the estate, but was not served on all creditors.

The September 15th Order bears the signatures of counsel for the Debtor, counsel for Wachovia, and the Trustee and states as follows:

IT IS HEREBY ORDERED that the Movant's Motion is GRANTED. The Automatic Stay pursuant to 11 U.S.C. § 362 is hereby LIFTED. The 10 day Stay pursuant to Bankruptcy Rule 4001(a)(3) is waived. Movant may proceed with its state law remedies and foreclose or otherwise dispose of or take action including, but not limited to, dispossessory proceedings, against said property now or formerly known as 9201 Market Street, Destin, Walton County, Florida, more particularly described on Exhibit “A” attached to the Motion for Relief from Automatic Stay, as necessary in order for the Movant to recover upon its secured claim to the property. Any excess proceeds derived from a foreclosure sale will be remitted to the Chapter 7 Trustee, Theo Davis Mann. The Chapter 7 Trustee has determined that there is not significant equity in the property that could be realized for the benefit of the estate and, in response to the request for stay relief, requests the Court to approve the abandonment of the property by entry of this Order.

Since the filing of her bankruptcy petition, the Plaintiff has not returned to the Unit. While the Plaintiff expected Wachovia to quickly conclude the Foreclosure Action, as of the time of the filing of the Plaintiff's complaint, the Foreclosure Action remained pending and the Plaintiff's ownership interest in the Unit had not yet been foreclosed.

On April 13, 2011, the Plaintiff filed the Complaint, which alleges that, at some time after Wachovia obtained relief from the automatic stay, the Defendant attempted to “use the [Foreclosure Action] to obtain a personal judgment against the [Plaintiff] and to perfect its lien against” the Unit. The Complaint does not state the date upon which the Defendant took any action in the Foreclosure Action, or what that action may have been. The Plaintiff seeks damages arising from the Defendant's alleged violation of the automatic stay, damages arising from the Defendant's “continuation of the [Foreclosure Action] in violation of the discharge injunction,” and reasonable attorney's fees. On May 27, 2011, the Defendant filed the instant motion to dismiss, which the Plaintiff opposes.

Conclusions of Law

A. Rule 12(b)(6)

The Defendant seeks dismissal of the complaint for failure to state a claim upon which relief can be granted. Pursuant to Federal Rule of Civil Procedure 12(b)(6), made applicable to this proceeding by Rule 7012 of the Federal Rules of Bankruptcy Procedure, the Court shall dismiss a cause of action if it fails to state a claim upon which relief can be granted. See Fed. R. Bankr.P. 7012(b); Fed.R.Civ.P. 12(b)(6). When reviewing a complaint for purposes of adjudicating such a motion to dismiss, the Court must accept as true all factual allegations contained in the complaint and, on the basis of those facts, determine whether the plaintiff is entitled to relief. See Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 554–55, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007); Daewoo Motor America, Inc. v. General Motors Corp., 459 F.3d 1249 (11th Cir.2006) (stating that the court must “view the complaint in the light most favorable to the plaintiff and accept the well-pleaded facts as true”). The facts asserted in the complaint need only comprise a “short and plain statement” that shows the plaintiff's claim for relief is “plausible on its face.” See Fed. R. Bankr.P. 7008; Fed.R.Civ.P. 8(a)(2); Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007); see also Watts v. Florida Intern. University, 495 F.3d 1289 (11th Cir.2007) (complaint must “alleged enough facts to suggest, raise a reasonable expectation of, and render plausible” the necessary elements of a cause of action); Schaaf v. Residential Funding Corp., 517 F.3d 544 (8th Cir.2008) (“The plaintiffs need not provide specific facts in support of their allegations, Erickson v. Pardus, 551 U.S. 89, 127 S.Ct. 2197, 167 L.Ed.2d 1081 (2007) (per curiam), but they must include sufficient factual information to provide the ‘grounds' on which the claim rests, and to raise a right to relief above a speculative level. Twombly, 127 S.Ct. at 1964–65 & n. 3.”). That being said, the Court need not accept as true “threadbare recitals of a cause of action's elements, supported by mere conclusory statements.” Ashcroft v. Iqbal, 556 U.S. 662, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009). A complaint has “facial plausibility” only when well pleaded facts permit the Court to “draw a reasonable inference that” the plaintiff can meet the required elements of the cause of action. Id. at 1940; see also Watts, 495 F.3d at 1296.

“The relevant record under consideration consists of the complaint and any ‘document integral or explicitly relied on in the complaint.’ ” In re New Century Holdings, Inc., 387 B.R. 95 (Bankr.D.Del.2008) (quoting U.S. Express Lines, Ltd. v. Higgins, 281 F.3d 383, 388 (3d Cir.2002); see also In re Raymond Professional Group, Inc., 386 B.R. 678 (Bankr.N.D.Ill.2008)) (“A court may consider only the contents of the pleadings,” which include “ ‘the complaint, the answer, and any written instruments attached as exhibits,’ ..., including documents incorporated by reference in the pleadings.”). Further, although the court may not consider matters outside the four corners of the complaint without converting the motion to dismiss to a motion for summary judgment.... [a] document attached to a motion to dismiss ... may be considered ... provided the document is “ ‘(1) central to the plaintiff's claim; and (2) undisputed.’ ” Chandler v. Kopelousos, 2011 WL 1791299 *3 (M.D.Fla. May 10, 2011).

Here, the Complaint incorporates by reference the Court's order lifting the automatic stay in favor of Wachovia. Although the Order is not attached to the Complaint, the Order is a matter of public record available in the Court's own records. Accordingly, the Court will consider the facts as stated in the Complaint and will take judicial notice of the language used in the Court's September 15th Order. Additionally, the Defendant's motion for summary judgment in the Foreclosure Action (hereinafter “Exhibit A”) is attached to the Plaintiff's response to the Defendant's motion to dismiss. Statements made by the Defendant in Exhibit A concerning when the Defendant served its crossclaim and summons against the Plaintiff and what relief the Defendant sought in the Foreclosure Action are central to the Plaintiff's claim. As there is no indication that the Defendant disputes the authenticity of Exhibit A, the Court will consider Exhibit A without converting the Defendant's motion to dismiss to a motion for summary judgment.

B. Whether the Defendant's Conduct Violated the Automatic Stay or the Discharge Injunction

The Defendant asserts that it did not violate the automatic stay by continuing to prosecute its claim against the Plaintiff in the Foreclosure Action because the Court's September 15th Order resulted in the abandonment of the Unit from the bankruptcy estate. The Defendant also submits that it did not violate the discharge injunction because its actions against the Plaintiff sought payment of amounts that are nondischargeable under section 523(a)(16) of the Code.

As noted above, the Court cannot ascertain from the Complaint what actions the Defendant took with regard to the Unit. The Complaint is vague with regard to what the Defendant filed in the state court action and when it was filed. In its Motion, the Defendant states that it was named as a defendant in the Foreclosure Action and that it filed its answer in the Foreclosure Action on June 19, 2009, four days prior to the date the Plaintiff filed her petition. The Defendant also states that it filed a two-count crossclaim against the Plaintiff for lien foreclosure and damages. Although it is not clear from the Complaint or the Motion, the Court assumes that the crossclaim was filed at the time the Defendant filed its answer, which would have been prepetition. Exhibit A, however, contains a statement by the Defendant that it served its crossclaim and summons on the Plaintiff on June 30, 2009, which was...