Haynes v. Bac Home Loan Servicing, LP
| Decision Date | 14 July 2016 |
| Docket Number | CIVIL ACTION FILE NO. 1:16-cv-00428-TWT-AJB |
| Parties | JOAN HAYNES and TROY WAYNE HAYNES, Plaintiffs, v. BAC HOME LOAN SERVICING, LP; MERSCORP HOLDINGS, INC., d/b/a Mortgage Electronic Registration Systems, Inc.; FEDERAL NATIONAL MORTGAGE ASSOCIATION; QUICKEN LOANS, INC.; DEBBIE R. FOUSHEE; and All Others, Defendants. |
| Court | U.S. District Court — Northern District of Georgia |
This matter is currently before the Court on Defendants' motion to dismiss for failure to state a claim, [Doc. 2], and Plaintiffs' motion to remand the case to state court, [Doc. 3]. For the reasons set forth herein, the undersigned RECOMMENDS that the motion to remand be DENIED, [Doc. 3], and that the motion to dismiss be GRANTED, [Doc. 2].
Plaintiffs Joan Haynes and Troy Wayne Haynes, who are represented by counsel, initiated this action in the Superior Court of Henry County, Georgia, on December 7, 2015. [Doc. 1-1]. They assert claims for fraud and for quiet title as to the property located at 1156 Folkstone Drive, McDonough, Georgia 30253 ("the Property"), and name as party defendants BAC Home Loan Servicing, LP ("BAC"); MERSCORP Holdings, Inc., doing business as Mortgage Electronic Registration Systems, Inc. ("MERS"); Federal National Mortgage Association ("Fannie Mae"); Quicken Loans, Inc. ("Quicken"); Debbie R. Foushee ("Ms. Foushee"); "and all others." [Id.]. This is Plaintiffs' third action regarding the Property, the first action having been filed in the Superior Court of Henry County, Georgia, on September 6, 20111; removed to this Court on September 16, 2011; amended on October 25, 2011, and August 24, 2012; dismissed on summary judgment on August 7, 2014; and affirmed by the Eleventh Circuit Court of Appeals on July 10, 2015, Haynes v. McCalla Raymer, LLC, Civ. Action No. 1:11-cv-3149-TWT (N.D. Ga.) ("Haynes I"), and the second action having been filed in the Superior Courtof Henry County, Georgia, on September 24, 20152; removed to this Court on October 21, 2015; amended on November 23, 2015; and voluntarily dismissed without prejudice on December 3, 2015, Haynes v. BAC Home Loan Servicing, LP, Civ. Action No. 1:15-cv-3704-TWT (N.D. Ga.) ("Haynes II").
On February 11, 2016, MERS, Fannie Mae, and BAC, acting with Quicken's consent, filed a notice of removal in the present action, asserting that this Court may exercise diversity-of-citizenship jurisdiction over the matter. [Doc. 1]. On February 18, 2016, the removing defendants filed the motion to dismiss that is presently pending before the Court. [Doc. 2]. On March 2, 2016, Plaintiffs filed the pending motion to remand. [Doc. 3]. On March 21, 2016, BAC filed a response in opposition to the motion to remand. [Doc. 4]. No further briefing having been filed, and the time for briefing having passed, the Court now considers the motions.
Under the federal removal statute, a defendant may in "any civil action brought in a State court of which the district courts of the United States have originaljurisdiction" remove the civil action to federal court. 28 U.S.C. § 1441(a). District courts have original jurisdiction over a case if: (1) the case involves diversity of citizenship (and the defendant is not a citizen of the state in which the action is brought); or (2) a claim arises under the Constitution, or treaties, or laws of the United States (without regard to the citizenship or residence of the parties).3 28 U.S.C. § 1441(b), (c).
In addition to the substantive jurisdictional requirements, a removing defendant must also contend with procedural requirements regarding the timeliness of removal. Pretka v. Kolter City Plaza II, Inc., 608 F.3d 744, 756 (11th Cir. 2010). A defendant has thirty days after receipt of an initial pleading to remove a case, or if the initial pleadingis not removable, the defendant may file a notice of removal within thirty days of receiving "a copy of an amended pleading, motion, order or other paper from which it may first be ascertained that the case is one which is or has become removable." 28 U.S.C. § 1446(b); accord Pretka, 608 F.3d at 757, 759-60.
Although the federal removal statute permits a defendant in a state civil action to remove the case to federal court under certain circumstances, federal law also allows the plaintiff to seek remand of the case to state court under 28 U.S.C. § 1447. 28 U.S.C. § 1447(c). Removal statutes are strictly construed against removal of the action. Diaz v. Sheppard, 85 F.3d 1502, 1506 (11th Cir. 1996); BCC Apartments, Ltd. v. Browning, 994 F. Supp. 1440, 1442 (S.D. Fla. 1997) (citing Shamrock Oil & Gas Corp. v. Sheets, 313 U.S. 100, 104 (1941)); Miles v. Kilgore 928 F. Supp. 1071, 1075 (N.D. Ala. 1996) ( ) (citing Shamrock Oil & Gas Corp., 313 U.S. at 104, and Fitzgerald v. Seaboard Sys. R.R., Inc., 760 F.2d 1249 (11th Cir. 1985)). The removing party bears the burden of demonstrating that removal was proper. Adventure Outdoors, Inc. v. Bloomberg, 552 F.3d 1290, 1294 (11th Cir. 2008); Diaz, 85 F.3d at 1506.
Plaintiffs argue that the matter is due to be remanded to state court because there is not complete diversity of citizenship and because Defendants filed the notice of removal out of time. [Doc. 3]. The Court first considers the diversity-of-citizenship issue and then turns to the question of timeliness.
Under 28 U.S.C. § 1332, the jurisdictional basis asserted here, district courts have original jurisdiction of all civil actions where the matter in controversy exceeds the sum or value of $75,000 and is between citizens of different states. 28 U.S.C. § 1332(a). "A party removing a case to federal court based on diversity of citizenship bears the burden of establishing the citizenship of the parties." Id.
Plaintiffs do not dispute that the value of the case exceeds $75,000. [Doc. 3 at 11]. The Court agrees, as this is an action for quiet title and the removing defendants filed tax records showing that the value of the Property as of January 1, 2015, was assessed at $148,500, [Doc. 1-2 at 2]. See Hosseinzadeh v. Green Point Mortg. Funding, Inc., 577 Fed. Appx. 925, 927 (11th Cir. Aug. 18, 2014) () (citing Cohen v. Office Depot, Inc., 204 F.3d 1069, 1077 (11th Cir. 2000)).
In contrast, the parties do dispute whether complete diversity exists in this case. The removing defendants acknowledge in their notice of removal that Ms. Foushee is alleged in the complaint to be of the same citizenship as Plaintiffs. [Doc. 1 ¶¶ 16-18]. Defendants contend, however, that Ms. Foushee's citizenship must be disregarded under the doctrine of fraudulent joinder because she is simply a notary whose name appears on a document recorded more than five years before the filing of this lawsuit and she had already defended in Haynes I, and thus, there is no plausible fraud claim asserted against her, and even a properly pleaded fraud claim would be blocked by the doctrine of res judicata or collateral estoppel or by the statute of limitations. [Doc. 1 ¶¶ 16-17 (citing Johnson v. Bank of Am., N.A., 594 Fed. Appx. 953, 956 (11th Cir. Nov. 6, 2014); Taylor Newman Cabinetry, Inc. v. Classic Soft Trim, Inc., 436 Fed. Appx. 888, 890 (11th Cir. May 31, 2011); Southern v. Pfizer, Inc., 471 F. Supp. 2d 1207, 1218 (N.D. Ala. 2006))].
Plaintiffs, in their motion to remand, assert that they and Ms. Foushee are all citizens of Georgia and argue that, as a consequence, all plaintiffs are not diverse from all defendants. [Doc. 3 at 11-19]. Plaintiffs argue that they can establish a fraud claimagainst Ms. Foushee because they have pleaded the necessary facts and she has failed to timely file an answer to the complaint and therefore has defaulted, and Plaintiffs further contend that "Defense counsel has no authority to make defenses on Ms. Foushee's behalf." [Id. at 13, 18-19]. Plaintiffs further contend that although a fraud claim is governed by a four-year statute of limitations, the period of limitation should be deemed to run only from November 13, 2013, the date they received an affidavit from the clerk of the Superior Court of Henry County confirming that "the August 30, 2010 recorded assignment, which [Ms.] Foushee purported to officially witness, failed to bear the required notary stamp, which was filed despite the error in the filing" and Plaintiffs therefore "had sufficient knowledge and proof of Ms. Foushee's and Defendants' fraudulent actions." [Id. at 14-17 (citing O.C.G.A. §§ 9-3-31, 23-2-51(b); Henderson v. Wash. Nat'l Ins. Co., 454 F.3d 1278, 1282 (11th Cir. 2006); Jones v. Spindel, 239 Ga. 68, 69, 235 S.E.2d 486, 487 (1977))]. Additionally, Plaintiffs argue that Haynes I does not estop them from asserting their fraud claim against Ms. Foushee because "the facts and parties to this action are not identical to the Haynes case adjudicated in the District Court and appealed to the Eleventh Circuit Court." [Doc. 3 at 17-18 (citing Cheeley Invs., L.P. v. Zambetti, 332 Ga. App. 115, 120-21, 770 S.E.2d 350, 356 (2015); Choi v. ImmanuelKorean United Methodist Church, 327 Ga. App. 26, 28, 755 S.E.2d 354, 356 (2014))].
Defendants, in response, again contend that there is no possibility that Plaintiffs could state a claim against Ms. Foushee, arguing that the claim against her is barred either by the doctrine of res judicata or collateral estoppel, as the allegations of fraud in Haynes I "almost identically mirror those in the present suit"; Ms. Foushee is named as a defendant in both...
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