Hillman v. Flagstar Bank
| Decision Date | 19 August 2021 |
| Docket Number | Civil Action 8:20-cv-02486-PX |
| Parties | TISHA S. HILLMAN, Plaintiff, v. FLAGSTAR BANK, FSB, et al., Defendants. |
| Court | U.S. District Court — District of Maryland |
Pending before the Court are Defendants Flagstar Bank, FSB, and BWW Law Group, LLC's motions to dismiss brought pursuant to Federal Rule of Civil Procedure 12(b)(6). ECF Nos. 7, 9. The matter has been fully briefed, and no hearing is necessary. See Loc. R. 105.6. For the following reasons, the motions to dismiss are granted.
Plaintiff Tisha S. Hillman, an attorney representing herself [1] owns the real property located at 2832 Nomad Court West Bowie, Maryland 20716 (“the Property”). ECF No. 4 ¶ 1. To purchase the Property, Hillman obtained a loan for which she executed a Deed of Trust conveying legal title to, and foreclosure rights on, the Property in the event she defaulted on the loan. ECF No. 7-3. The loan was subsequently assigned to Pingora Loan Servicing, LLC (“Pingora”). ECF No. 7-4. Defendant BWW Law Group, LLC, (“BWW”) is a Maryland law firm which represents Pingora in foreclosure proceedings. ECF Nos. 4 ¶¶ 8-9; 9-3.
Defendant Flagstar Bank, FSB, (the “Bank”), headquartered in Troy, Michigan, is the mortgage servicer. ECF No. 4 ¶¶ 3, 5-6. The Bank advertises that it conducts business guided by the “STAR Values” of service, trust, accountability, and results. Id. ¶ 32. The Bank specifically promises to “do things right the first time; offer the same level of service we expect and appreciate in return; give substance-not lip service; build a culture of mutual respect and transparency; build a culture where the integrity we strive to uphold are without compromise; and live up to the commitments we make to our customers.” Id.
In October 2018, the ceiling at the Property collapsed, costing Hillman $70, 000 worth of repairs. ECF No. 4 ¶ 11. After the repairs, Hillman struggled to pay her mortgage and ultimately defaulted on the mortgage loan. That same month, BWW, acting on behalf of the Bank, began foreclosure proceedings on the Property in the Circuit Court for Prince George's County, Maryland. Id. ¶ 9; ECF No. 9-4; WBGLMC v. Hillman, No. CAEF18-35990 (Cir. Ct. Prince George's Cnty. filed October 11, 2018).[2]
Hillman next filed for Chapter 13 Bankruptcy on October 22, 2018. ECF No. 4 ¶ 10; In re Tisha Sherrell Hillman, No. 18-24004-TJC (Bankr. D. Md. filed October 22, 2018). Consequently, the automatic stay provision of the Bankruptcy Act, 11 U.S.C. § 362, halted the foreclosure proceedings. Pingora filed a proof of claim in the Bankruptcy court related to the secured loan on the Property, and the Bank requested leave from the automatic stay provision. ECF Nos. 7-6; 7-7. These filings reflect that Hillman had fallen behind in her mortgage payments and that per the loan agreement terms, she owed an outstanding loan balance of $210, 464.55 plus approximately $7, 456.06 in post-petition arrears. ECF Nos. 7-6; 7-7 at 2-3.
On April 22, 2019, the Bankruptcy court approved Hillman's Chapter 13 plan. ECF No. 7-8. The plan provided that Hillman would satisfy the pre-petition arrearage through twelve monthly payments to the Bankruptcy Trustee. Id. Hillman also agreed that the Bankruptcy court would enter an “Order and Stipulation Modifying the Automatic Stay” (“Stipulation”). ECF No. 7-9. The Stipulation also provided for Pingora to file a new claim for the post-petition arrears and that Hillman would, in turn, file an amended Bankruptcy plan to pay off those arrears. Id. Hillman also agreed that she would make monthly mortgage payments of $1, 174.55 beginning May 2019 as part of the Stipulation. ECF Nos. 4 ¶¶ 12-13; 7-9. at 2-3.
While Hillman made some payments towards her mortgage, they were not full payments. The Defendants also maintain that Hillman never filed an amended plan and failed to cure her post-petition arrears.[3] And on September 27, 2019, the Bankruptcy court dismissed Hillman's Chapter 13 action because failed to make the plan payments. ECF Nos. 7-5 at 2-3; 7-10.
The next month, the Bank began rejecting Hillman's partial monthly mortgage payments and charging associated fees, per the Deed of Trust terms. ECF No. 4 ¶¶ 19-20; 7-3 at 4. BWW likewise attempted to resurrect the foreclosure action in Circuit Court. ECF No. 4 ¶ 15. Hillman objected, arguing that she had fully complied the terms of the Stipulation, and thus resuming the foreclosure action was improper. ECF No. 11-10 at 5-9. The Circuit Court dismissed the action without prejudice and directed BWW to pay $ 2, 037.09 in attorney's fees. ECF No. 11-10 at 510, 39-46. The Circuit Court later reconsidered its decision and vacated the award of attorney's fees but allowed the dismissal without prejudice to stand. ECF No. 9-6. At present, Hillman resides in the Property and pursuant to the Coronavirus Aid, Relief, and Economic Security Act (CARES ACT), 15 U.S.C. § 9056, a federal foreclosure moratorium has prohibited any further action. See ECF Nos. 4 ¶ 1; 9-1 at 5 n. 10.
On July 23, 2020, Hillman filed a separate suit in the Prince George's County Circuit Court against the Bank and BWW, which Defendants timely removed to this Court. ECF No. 1. Hillman brings claims for breach of contract, intentional interference with contractual relations, unjust enrichment, breach of servicer duty under the Real Estate Settlement Procedures Act (“RESPA”), 12 U.S.C. § 2605(k)(1)(C); unfair, deceptive, or abusive practices under the Consumer Finance Protection Act (“CFPA”), 12 U.S.C §§ 1036(a)(1)(b) & 5536(a)(1)(b); negligence, and negligent and intentional infliction of emotional distress. ECF No. 4. Hillman seeks compensatory damages of $80, 537.09, punitive damages, attorney's fees and costs, and an order enjoining Defendants from attempting to foreclose on the Property. Id. at p. 14.
A motion brought under Rule 12(b)(6) of the Federal Rules of Civil Procedure tests the sufficiency of the complaint. In reviewing the motion, the Court “accepts the factual allegations in the complaint as true and construes them in the light most favorable to the nonmoving party.” Rockville Cars, LLC v. City of Rockville, 891 F.3d 141, 145 (4th Cir. 2018). The Court may also consider documents attached to the motion to dismiss when “integral to and explicitly relied on in the complaint, and when the [opposing parties] do not challenge the document[s'] authenticity.” Zakv. Chelsea Therapeutics, Int'l, Ltd., 780 F.3d 597, 606-07 (4th Cir. 2015) (quoting Am. Chiropractic Ass'n v. Trigon Healthcare, Inc., 367 F.3d 212, 234 (4th Cir. 2004)) (internal quotation marks omitted). But the Court does not look beyond the four corners of the Complaint and incorporated attachments, and thus will not allow amendment of the Complaint through a plaintiff's artful response to the motions. See Whiting-Turner Contracting Co. v. Liberty Mut. Ins. Co., 912 F.Supp.2d 321, 334 (D. Md. 2012) () (internal quotations omitted); see also S. Walk at Broadlands Homeowner's Ass'n, Inc. v. OpenBand at Broadlands, LLC, 713 F.3d 175, 184 (4th Cir. 2013).
To survive a motion to dismiss, “a complaint must contain sufficient factual matter, accepted as true, to state a claim to relief that is plausible on its face.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (internal quotation marks omitted). “A plaintiff must provide sufficient detail to show that he has a more-than-conceivable chance of success on the merits.” Upstate Forever v. Kinder Morgan Energy Partners, L.P., 887 F.3d 637, 645 (4th Cir. 2018), vacated on other grounds, 140 S.Ct. 2736 (2020).
The Defendants challenge the sufficiency of all claims. The Court discusses each in turn.
The Complaint principally avers that the Bank breached its “STAR values” and the Stipulation when it refused to accept Hillman's partial mortgage payments in 2019. ECF No. 4 ¶¶ 31-39. The Bank argues that the STAR values material and the Stipulation do not, as a matter of law, create legally binding contracts with Hillman. ECF No. 7-1 at 5-6. Notably, Hillman agrees. ECF No. 11-1 at 6. In responding to these motions, Hillman expressly asks that the Court declare no contract was ever formed. Id.
The Court struggles mightily to understand the point of Hillman's concession given that she chose to bring the breach of contract claim in the first place. But because Hillman agrees that the Star values material and Stipulation do not create a binding contract, the Court finds that she has abandoned the contract claim. Cf. Ferdinand-Davenport v. Children's Guild, 742 F.Supp.2d 772, 777 (D. Md. 2010) (); Williams v. Silver Spring Volunteer Fire Dep't, 86 F.Supp.3d 398, 419 (D. Md. 2015). Thus, Count I must be dismissed.
Next as to Count II, intentional interference with contractual relations, Defendants rightly argue that this claim may be brought only as to third parties who interfere with the contractual relationship of the contracting parties. ECF Nos 7-1 at 6-7; 9-1 at 8-10. In Maryland, one party to a contract cannot sue the other party or its agents for “interfering” with the contract's terms. Kaser v. Fin. Prot. Mktg., Inc., 376 Md. 621, 630 (2003) (collecting cases); Goode v. Am. Veterans, Inc., 874 F.Supp.2d 430, 447 n. 12 (D. Md. 2012); see also Byington v. Vega Biotechnologies, Inc., 869 F.Supp. 338, 342-43 (D. Md. 1994). That claim, instead, properly sounds in breach of contract. Wilmington Tr....
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