Gelinas v. U.S. Bank

• Decision Date: 10 February 2017
• Docket Number: CASE NO. 16-1468JLR
• Court: U.S. District Court — Western District of Washington
• Parties: DAVID R. GELINAS, et al., Plaintiffs, v. U.S. BANK, NA, et al., Defendants.

DAVID R. GELINAS, et al., Plaintiffs, v. U.S. BANK, NA, et al., Defendants.

CASE NO. 16-1468JLR

UNITED STATES DISTRICT COURT WESTERN DISTRICT OF WASHINGTON AT SEATTLE

February 10, 2017

ORDER GRANTING MOTIONS TO DISMISS

I. INTRODUCTION

Before the court are Defendants U.S. Bank Trust, NA¹ ("U.S. Bank") and Caliber Home Loans, Inc.'s ("Caliber Home") motion to dismiss (1st Mot. (Dkt. # 8)) and Quality Loan Service Corporation of Washington's ("Quality Loan") motion to dismiss (2d Mot. (Dkt. # 10)) Plaintiffs David and Karen Gelinas's complaint (Compl. (Dkt.# 1)). The court has considered the motions, the submissions filed in support thereof and opposition thereto, the relevant portions of the record, and the applicable law. Being fully advised,² the court GRANTS U.S. Bank and Caliber Home's motion and GRANTS Quality Loan's motion for the reasons set forth below.

II. BACKGROUND

This case arises out of a planned non-judicial foreclosure—a trustee's sale—of the Gelinases' home and Mr. Gelinas's resulting bankruptcy filing. (Req. (Dkt. # 9) at 2, Ex. F at 2; Compl. ¶¶ 18, 21.) On September 21, 2006, the Gelinases signed a deed of trust³ for $368,000.00 with Washington Mutual Bank, which was recorded against the Gelinases' residence in Marysville, Washington. (Compl. ¶¶ 13, 15; see also Req. at 2, Ex. A, at 3.) In the three-way deed of trust transaction, the Gelinases were the borrowers, Washington Mutual Bank was the lender, and Rainier Title was the trustee at the time the parties signed the deed of trust. (Compl. ¶¶ 15, 28.) The balance of the Gelinases' allegations focus on the multiple assignments and transfers of the deed of trust prior to the foreclosure.

//

// Although the Gelinases' complaint is not a model of clarity, the court summarizes the Gelinases' allegations as follows.⁴ The Gelinases allege that various banks assigned the deed of trust multiple times after its initial recording. (Id. ¶¶ 28-29, 31-34.) First, on August 1, 2008, Deutsche Bank National Trust Company ("Deutsche Bank") recorded an assignment of the deed of trust from Washington Mutual Bank. (Id. ¶ 29.) Nearly five years later, on April 4, 2013, JPMorgan Chase Bank ("JPMorgan") recorded an assignment of the deed of trust from Deutsche Bank. (Compl. ¶ 33 (noting that the year is mistakenly listed as 2014 and that exhibit D states the correct date); see id. ¶ 33, Ex. D at 2.) JPMorgan then assigned the deed of trust to U.S. Bank and recorded the assignment on August 3, 2015. (Id. ¶ 34.)

In addition to the multiple assignments of the deed, the Gelinases allege that the trustee of the deed also transferred multiple times. (Id. ¶¶ 28-31.) Before Deutsche Bank recorded itself as the beneficiary of the deed of trust,⁵ the bank recorded a substitution of the trustee under the deed of trust by appointing Quality Loan as substitute trustee on July 18, 2008. (Id. ¶ 28.) On November 16, 2009, JPMorgan recorded J.P. Morgan Chase Custody Services as trustee under the deed of trust. (Id. ¶ 32, Ex. C at 2.) On April 24, 2013, JPMorgan appointed Quality Loan as the new trustee under the deed of trust. (Req. at 2, Ex. E, at 34.)

// In May, 2016, Quality Loan—the recorded trustee at that time—notified the Gelinases of the pending trustee's sale. (Id., Ex. F at 37.) On August 12, 2016, Mr. Gelinas filed for bankruptcy, and on August 29, 2016, Mr. Gelinas amended his bankruptcy filing. (Compl. ¶ 18; Req. at 2, Ex. A, at 1.)

On September 16, 2016, the Gelinases filed this pro se lawsuit against U.S. Bank, Quality Loan, JPMorgan, Long Beach Mortgage Loan Trust 2006-10, Deutsche Bank, Caliber Home, and Does 1-10. In their complaint, the Gelinases assert a claim to quiet title to the subject property. (Compl. ¶ 20.) They allege that there is no evidence that JPMorgan could have a valid "security interest in the Note." (Id. ¶ 20.) Based on this absence of "evidence," the Gelinases assert that the assignment to JPMorgan is invalid, and as a result "there have been multiplicities of invalid, illegitimate[,] and unauthorized recordings in the Snohomish Country [sic] Recorders' Office, all of which must be rescinded." (Id. ¶ 21.) The Gelinases also allege that these "illegitimate . . . recordings" constitute slander of title, and they request special damages of $100,000.00. (Id. ¶¶ 26, 36.) Finally, the Gelinases allege that Quality Loan is not authorized to collect payments from them or to threaten to foreclose on their property and that Quality Loan's attempts to do so violate 15 U.S.C. § 1692e(5).⁶ (Id. ¶¶ 23-24.)

The Gelinases also seek declaratory relief in the form of "a judicial determination of the rights, obligations, and interests of the parties with regard to the Property." (Id.¶ 38.) Specifically, the Gelinases ask for a determination that U.S. Bank is not the beneficiary under the deed of trust. (Id. ¶ 39.) Furthermore, the Gelinases request that "all scheduled foreclosure proceedings be vacated," and that U.S. Bank "be forever estopped from foreclosing on the subject property." (Id. ¶ 40.)

III. ANALYSIS

U.S. Bank, Caliber Home, and Quality Loan move for dismissal under Federal Rule of Civil Procedure 12(b)(6). (1st Mot. at 1; 2d Mot. at 1.) Because U.S. Bank and Caliber Home's motion relies, in part, on documents for which they request judicial notice, the court begins by addressing the parties' requests for judicial notice. The court then addresses the motions to dismiss and whether leave to amend is appropriate.

A. Judicial Notice

Because the motions to dismiss rely on certain documents, the court first addresses U.S. Bank and Caliber Home's and the Gelinases' requests for judicial notice. (Req.; Obj. (Dkt. # 12).) U.S. Bank and Caliber Home request that the court notice the recording of the deed of trust of the subject property (Req. at 2, Ex. A), three sequential recordings of the assignment of the deed of trust (id., Exs. B, C, D), a recorded notice of successor trustee (id., Ex. E), a recorded notice of trustee sale (id., Ex. F), and Mr. Gelinas's amended petition for bankruptcy (id., Ex. G).

The Gelinases oppose all of these requests. (See generally Obj.) In their opposition, the Gelinases assert that "[t]here are a multiplicity of problems/errors on the documents recorded in the Snohomish County Registry." (Id. at 2.) The Gelinases further argue that the documents in question are in dispute and thus cannot be judiciallynoticed. (Id.) The Gelinases also oppose the court taking judicial notice of the bankruptcy petition, but offer only the assertion that "Plaintiffs['] schedules have been amended again." (Id. at 3.) U.S. Bank and Caliber Home reply that the Gelinases object only to the "validity of the documents, not the content therein." (Not. Reply (Dkt. # 14) at 2.) Furthermore, U.S. Bank and Caliber Home assert that the documents are all incorporated by reference into the complaint (id. (citing U.S. v. Ritchie, 342 F.3d 903, 908-09 (9th Cir. 2003))), and that a court can take judicial notice of a public record that contains contested facts, provided that the authenticity of the document is not subject to reasonable dispute (id. at 2-3).

In their response to U.S. Bank and Caliber Home's request, the Gelinases also request judicial notice of a document that appears to be a title search by a company called Certified Loan Auditors.⁷ (Obj. at 5-8.) U.S. Bank and Caliber Home oppose this request, arguing that the document is not a public record and that the court should not consider it in ruling on their motion to dismiss. (Not. Reply at 4-5.)

"The court may judicially notice a fact that is not subject to reasonable dispute because it . . . can be accurately and readily determined from sources whose accuracy cannot reasonably be questioned." Fed. R. Evid. 201(b). The court can take judicial notice of public records that are not "subject to reasonable dispute." Santa Monica Food Not Bombs v. City of Santa Monica, 450 F.3d 1022, 1025 n.2 (9th Cir. 2006) (citing Leev. City of L.A., 250 F.3d 668, 689 (9th Cir. 2001), overruled on other grounds by Galbraith v. Cty. of Santa Clara, 307 F. 3d 1119, 1125 (9th Cir. 2002)). Indeed, a court may take judicial notice of a public record when its authenticity is unchallenged, even if a party contests the assertions contained within the document. See Palmason v. Weyerhaeuser, No. C11-0695RSL, 2013 WL 1788002, at *2-3 (W.D. Wash. Apr. 26, 2013) (citing Branch v. Tunnell, 14 F.3d 449, 454 (9th Cir. 1994), overruled on other grounds by Galbraith v. Cty. of Santa Clara, 307 F.3d 1119, 127 (9th Cir. 2002)). Courts may also take judicial notice of court filings because their contents cannot be reasonably disputed. Reyn's Pasta Bella, LLC v. Visa USA, Inc., 442 F.3d 741, 746 n.6 (9th Cir. 2006).

In this case, the court takes judicial notice of the recorded documents that U.S. Bank and Caliber Home present to the court. (See Req. at 2.) U.S. Bank and Caliber Home attest that these documents are authentic copies of Snohomish County public records. (Not. Reply at 3.) Although the "factual statements and opinions contained therein have not been conclusively established," these documents are authentic documents recorded with a governmental agency. See Palmason, 2013 WL 1788002, at *3.⁸ The court also takes judicial notice of Mr. Gelinas's bankruptcy petition. (See Req. at 2, Ex. G at 2.)

However, the court denies the Gelinases' request for judicial notice of the title search document. Although this document references public records, the document appears to be the product of a private company that conducted a title search for the Gelinases. (See Obj. at 5-8.) Accordingly, the document is not a public record, and it cannot be "accurately and readily determined from sources whose accuracy cannot reasonably be questioned." Fed. R. Evid. 201(b).

The court now addresses the motions to dismiss the Gelinases' complaint. (See 1st Mot.; 2d Mot.)

B. Motions to Dismiss

1. Legal Standard

When considering a motion to dismiss under Federal Rule...