Kiminaia v. Mortg. Elec. Registration Sys.
| Decision Date | 18 December 2014 |
| Docket Number | No. 318597,318597 |
| Parties | NADA KIMINAIA, Plaintiff/Counter-Defendant/Appellant, and NAMEER KIMINAIA, Intervening Plaintiff/Counter-Defendant, v. MORTGAGE ELECTRONIC REGISTRATION SYSTEMS, Defendant, and BANK OF AMERICA and COUNTRYWIDE HOME LOANS, INC., Defendants/Counter-Plaintiffs/Appellees, and SUNDUS SALMOU, CTC MORTGAGE BROKERS, INC., and AMERICAN PROFESSIONAL TITLE COMPANY, Defendants. |
| Court | Court of Appeal of Michigan — District of US |
UNPUBLISHED
Oakland Circuit Court
Before: JANSEN, P.J., and TALBOT and SERVITTO, JJ.
Plaintiff, Nada Kiminaia, appeals as of right the trial court's order granting summary disposition in favor of defendants Countrywide Home Loans, Inc. ("Countrywide") and Bank of America ("BOA") with respect to her claims against them. We affirm.
Plaintiff initiated a complaint against all defendants after her home was foreclosed upon by Mortgage Electronic Registration Systems (acting as nominee for Countrywide, the lender) and thereafter sold at a sheriff's sale. Countrywide ultimately obtained title to the property through a quitclaim deed from MERS. Plaintiff did not redeem the property within the requisite time period. According to plaintiff, the signatures on the mortgage and note refinancing the home, and upon which the foreclosure was based, were not hers and were, in fact, forgeries. Plaintiff asserted that defendant Sundus Salmou, an owner and agent of CTC Mortgage Brokers, Inc. falsified her information and signatures on mortgage loan documents. Plaintiff alleged fraud, violation of statutory foreclosure procedures, violation of the Federal Real Estate Settlement Procedures Act (12 USC § 2601 et seq.), violation of the Truth in Lending Act (15 USC §1601 et seq.), violation of the Fair Debt Collection Practices Act (15 USC § 1692 et seq.), intentional infliction of emotional distress, and slander of title and sought to quiet title to the property in her favor. Plaintiff's husband, Nameer Kiminaia, intervened as a plaintiff and filed a separate complaint against defendants alleging fraud, wrongful foreclosure/breach of contract, intentional infliction of emotional distress, and slander of title and sought to quiet title to the property in his favor as well.
Countrywide and its successor in interest, BOA, counter-sued against plaintiff and intervening plaintiff for quiet title and slander of title. These defendants/counter-plaintiffs thereafter moved for summary disposition pursuant to MCR 2.116(C)(7),(8),(9) and (10) and plaintiff and intervening plaintiff moved for judgment in their own favor, relying upon MCR 2.116(I)(2). The trial court granted summary disposition in favor of Countrywide and BOA, dismissing plaintiff's and intervening plaintiff's complaints, and finding that Countrywide and BOA were further entitled to summary disposition in their favor as to their counter-complaints against plaintiff and intervening plaintiff for slander of title and seeking quiet title. Plaintiff now appeals the trial court's dismissal of her claims against Countrywide and BOA.1
This Court reviews a trial court's ruling on a motion for summary disposition de novo. Anzaldua v Neogen Corp, 292 Mich App 626, 629; 808 NW2d 804 (2011). Summary disposition is appropriate under MCR 2.116(C)(7) when the undisputed facts establish that the plaintiff's claim is barred under the applicable statute of limitations. Kincaid v Cardwell, 300 Mich App 513, 522; 834 NW2d 122 (2013). A motion under MCR 2.116(C)(8) tests the legal sufficiency of the claim as pleaded, and all factual allegations and reasonable inferences supporting the claim are taken as true. McHone v Sosnowski, 239 Mich App 674, 676; 609 NW2d 844 (2000).
Summary disposition should be granted under MCR 2.116(C)(9) if a defendant fails to plead a valid defense to a claim. Village of Dimondale v Grable, 240 Mich App 553, 564; 618 NW2d 23 (2000). If the defenses are "so clearly untenable as a matter of law that no factualdevelopment could possibly deny plaintiff's right to recovery" then summary disposition under this rule is proper. Domako v Rowe, 184 Mich App 137, 142; 457 NW2d 107 (1990)(internal quotation and citation omitted).
A motion for summary disposition under MCR 2.116(C)(10) tests the factual sufficiency of the complaint. Joseph v Auto Club Ins Ass'n, 491 Mich 200, 206; 815 NW2d 412 (2012). When deciding a motion for summary disposition pursuant to MCR 2.116(C)(10), a court must consider the pleadings, affidavits, depositions, admissions, and other documentary evidence submitted in the light most favorable to the nonmoving party. Id. The non-moving party "may not rely on mere allegations or denials in pleadings, but must go beyond the pleadings to set forth specific facts showing that a genuine issue of material fact exists." Quinto v Cross and Peters Co, 451 Mich 358, 362; 547 NW2d 314 (1996).
On appeal, plaintiff first argues that her claim for violation of the Truth in Lending Act ("TILA") is not time barred. We disagree.
The limitations period for initiating actions under the TILA is found at 15 USC 1640(e), in relevant part, as follows:
Except as provided in the subsequent sentence, any action under this section may be brought in any United States district court, or in any other court of competent jurisdiction, within one year from the date of the occurrence of the violation or, in the case of a violation involving a private education loan (as that term is defined in section 1650(a) of this title), 1 year from the date on which the first regular payment of principal is due under the loan. Any action under this section with respect to any violation of section 1639, 1639b, or 1639c of this title may be brought in any United States district court, or in any other court of competent jurisdiction, before the end of the 3-year period beginning on the date of the occurrence of the violation. This subsection does not bar a person from asserting a violation of this subchapter in an action to collect the debt which was brought more than one year from the date of the occurrence of the violation as a matter of defense by recoupment or set-off in such action, except as otherwise provided by State law. An action to enforce a violation of section 1639, 1639b, 1639c, 1639d, 1639e, 1639f, 1639g, or 1639h of this title may also be brought by the appropriate State attorney general in any appropriate United States district court, or any other court of competent jurisdiction, not later than 3 years after the date on which the violation occurs . . . .
The mortgage and note at issue bear signature dates in May 2003. An alleged repayment plan agreement relative to default on the above note bears a signature date in November 2007. Plaintiff's claim concerning violations of the TILA was not brought until June 2012. It thus falls far outside both the one and three year limitation periods set forth in 15 USC §1640(e). Plaintiff's claim of TILA violations would thus be time barred.
Plaintiff argues that the statutes of limitations do not apply here because her claims in effect constitute defenses to the foreclosure sale initiated by defendants under 15 USC §1640(k). Plaintiff's argument is unavailing.
15 USC §1640(k) provides:
Defense to foreclosure
(1) In general
Notwithstanding any other provision of law, when a creditor, assignee, or other holder of a residential mortgage loan or anyone acting on behalf of such creditor, assignee, or holder, initiates a judicial or nonjudicial foreclosure of the residential mortgage loan, or any other action to collect the debt in connection with such loan, a consumer may assert a violation by a creditor of paragraph (1) or (2) of section 1639b(c) of this title, or of section 1639c(a) of this title, as a matter of defense by recoupment or set off without regard for the time limit on a private action for damages under subsection (e).
As pointed out in Beach v Ocwen Federal Bank, 523 US 410, 412; 118 S Ct 1408; 140 L Ed 2d 566 (1998), under §1640(e), "a borrower may assert the right to damages 'as a matter of defense by recoupment or set-off' in a collection action brought by the lender even after the one year is up." (emphasis added). Courts interpreting and applying § 1640(e), have overwhelmingly held that this "exception" to the statute of limitations in the TILA relied upon by plaintiff applies only when violations of the TILA are asserted as a defense in a collection action brought by the lender, even where the plaintiff may have filed suit in response to a defendant's foreclosure efforts.
of TILA. Moor v Travelers Ins Co, 784 F 2d 632, 634 (5th Cir, 1986). Here, plaintiff has asserted her TILA claim affirmatively, in an action for damages that she herself commenced, and not as a defense in an action brought by the lender to collect the debt.
Moreover, plaintiff did not plead, or support, a claim for recoupment or set-off, as is necessary to fall within the parameters of §1640(k). Under § 1640(k) "a consumer may assert a violation by a creditor . . . as a matter of defense by recoupment or set off without regard for the time limit on a private action for damages under subsection (e)." "In order to bring a claim for damages after the one-year limitations period has expired, plaintiff must assert her claims as a defense by recoupment in a collection action brought by the lender." Midouin v Downey Sav & L Ass'n, FA, 834 F Supp 2d 95, 108-09 (EDNY 2011)(internal quotation omitted). To claim recoupment under TILA, which will not be subject to the one-year limitations period, one must show that, 1) the TILA violation and the debt are products of the same transaction, 2) the claim is asserted as a defense, and 3) the main action is timely. In re Woolaghan, 140 BR 377, 383 (1992). Debtors cannot avoid the statute of limitations by...
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