Lucido v. U.S. Bank Nat'Lass'N
| Decision Date | 11 July 2016 |
| Docket Number | Case Number 15-13697 |
| Parties | SEBASTIAN LUCIDO, and KRIS LUCIDO, Plaintiffs, v. U.S. BANK NATIONAL ASSOCIATION, as trustee for MASTR ADJUSTABLE RATE MORTGAGES, TRUST 2006-0A1, MORTGAGE PASS THROUGH CERTIFICATES SERIES 2006-0A1 as assignee, Defendant. |
| Court | U.S. District Court — Eastern District of Michigan |
Honorable David M. Lawson
Plaintiffs Sebastian and Kris Lucido filed the present action in an attempt to set aside the sheriff sale on their home in Rochester, Michigan valued at $1,650,000. They identified eight claims in their complaint, pleaded in separate counts. The disputes center on whether defendant U.S. Bank National Association posted the notice of the foreclosure by advertisement in a conspicuous place on the plaintiffs' property, and an alleged promise not to go forward on the sheriff's sale while a loan modification was being considered. The case is now before the Court on the defendant's motion to dismiss. The Court heard oral argument on February 3, 2016. Because the complaint makes only vague allegations, and to the extent any arguments are made, they are foreclosed by law, the plaintiffs have not stated any claim upon which relief can be granted. Therefore, the Court will grant the defendant's motion and dismiss the complaint.
The complaint states very few facts. From what has been pleaded, and from the public record exhibits attached the defendant's motion to dismiss, it appears that the plaintiffs' home is located at 5404 Barrington in the City of Rochester, Oakland County, Michigan (the property). On January 9, 2006, the plaintiffs received a loan from non-party American Home Mortgage Acceptance, Inc. for $1,650,000. To secure repayment of the loan, the plaintiff granted a mortgage on the property to Mortgage Electronic Registration Systems, Inc. (MERS), solely as nominee for lender and lender's successors and assigns. MERS, and the successors and assigns of MERS are named as the mortgagee; the mortgage was recorded on April 11, 2006. On November 1, 2012, MERS assigned the mortgage to defendant U.S. Bank, N.A., as trustee for MASTR Adjustable Rate Mortgages, Trust 2006-0A1, Mortgage Pass Through Certificates Series 2006-0A1. That assignment was recorded on November 21, 2012.
The plaintiffs defaulted on their obligations under the loan at some point before the fall of 2014. They allege that the defendant promised to consider them for a loan modification or financial accommodation between the fall of 2014 and the sheriff's sale, which occurred on March 17, 2015. However, no modification agreement was consummated or even signed, and the defendant continued with the foreclosure by advertisement.
The plaintiffs contend that the foreclosure was defective because the defendant did not post a foreclosure notice on the property within the 15-day statutory time frame. The plaintiffs allege that the defendant intentionally did not post the notice of foreclosure in order to prevent the plaintiffs from entering into a loan modification. The sheriff's deed, however, contains two notarized affidavits averring that the foreclosure was published in the Oakland County Legal News beginningon February 12, 2015 for four successive weeks, and that the notice was annexed to the property in a conspicuous place nine days later.
The plaintiffs also allege that the defendant promised to engage in the loan modification process, but then somehow used that process to deceive the plaintiffs and foreclose on their home. The complaint does not elaborate on how that was done.
The defendant purchased the property at the sheriff's sale on March 17, 2015. The redemption period expired on September 17, 2015. The plaintiffs filed their complaint in state court on September 21, 2015. It was signed by the plaintiffs' attorney on September 18, 2015, the day after the redemption period ended. The complaint identifies eight counts: (1) quiet title; (2) breach of Michigan Compiled Laws § 600.3208; (3) breach of an implied agreement/specific performance; (4) innocent/negligent misrepresentation; (5) promissory estoppel; (6) unjust enrichment; (7) unfair trade practice; and (8) injunction and other relief. With their complaint, the plaintiffs filed an ex parte motion for a temporary restraining order to stay and toll the expiration of the redemption period. The state court judge denied the plaintiffs' motion that same day. The defendant properly removed this action on October 20, 2015 and filed its motion to dismiss a week later.
The defendant's motion is brought under Federal Rule of Civil Procedure 12(b)(6). "The purpose of Rule 12(b)(6) is to allow a defendant to test whether, as a matter of law, the plaintiff is entitled to legal relief if all the facts and allegations in the complaint are taken as true." Rippy ex rel. Rippy v. Hattaway, 270 F.3d 416, 419 (6th Cir. 2001) (citing Mayer v. Mylod, 988 F.2d 635, 638 (6th Cir. 1993)). Under Rule 12(b)(6), the complaint is viewed in the light most favorable to the plaintiff, the allegations in the complaint are accepted as true, and all reasonable inferences aredrawn in favor of the plaintiff. Bassett v. Nat'l Collegiate Athletic Ass'n, 528 F.3d 426, 430 (6th Cir. 2008). "However, while liberal, this standard of review does require more than the bare assertion of legal conclusions." Columbia Nat'l Res., Inc. v. Tatum, 58 F.3d 1101, 1109 (6th Cir. 1995); Tackett v. M & G Polymers, USA, L.L.C., 561 F.3d 478, 488 (6th Cir. 2009). Fabian v. Fulmer Helmets, Inc., 628 F.3d 278, 280 (6th Cir. 2010). "Where a complaint pleads facts that are 'merely consistent with' a defendant's liability, it 'stops short of the line between possibility and plausibility of entitlement to relief.'" Iqbal, 556 U.S. at 678 (quoting Twombly, 550 U.S. at 557).
Under the new regime ushered in by Twombly and Iqbal, pleaded facts must be accepted by the reviewing court but conclusions may not be accepted unless they are plausibly supported by the pleaded facts. "[B]are assertions," such as those that "amount to nothing more than a 'formulaic recitation of the elements'" of a claim, can provide context to the factual allegations, but are insufficient to state a claim for relief and must be disregarded. Iqbal, 556 U.S. at 681 (quoting Twombly, 550 U.S. at 555). However, as long as a court can "'draw the reasonable inference that the defendant is liable for the misconduct alleged,' a plaintiff's claims must survive a motion to dismiss." Fabian, 628 F.3d at 281 (quoting Iqbal, 556 U.S. at 678).
Consideration of a motion to dismiss under Rule 12(b)(6) is confined to the pleadings. Jones v. City of Cincinnati, 521 F.3d 555, 562 (6th Cir. 2008). Assessment of the facial sufficiency of the complaint ordinarily must be undertaken without resort to matters outside the pleadings. Wysockiv. Int'l Bus. Mach. Corp., 607 F.3d 1102, 1104 (6th Cir. 2010). However, "documents attached to the pleadings become part of the pleadings and may be considered on a motion to dismiss." Commercial Money Ctr., Inc. v. Illinois Union Ins. Co., 508 F.3d 327, 335 (6th Cir. 2007) (citing Fed. R. Civ. P. 10(c)); see also Koubriti v. Convertino, 593 F.3d 459, 463 n.1 (6th Cir. 2010). Even if a document is not attached to a complaint or answer, "when a document is referred to in the pleadings and is integral to the claims, it may be considered without converting a motion to dismiss into one for summary judgment." Commercial Money Ctr., 508 F.3d at 335-36. If the plaintiff does not directly refer to a document in the pleadings, but that document governs the plaintiff's rights and is necessarily incorporated by reference, then the motion need not be converted to one for summary judgment. Weiner v. Klais & Co., Inc., 108 F.3d 86, 89 (6th Cir. 1997) (). In addition, "a court may consider matters of public record in deciding a motion to dismiss without converting the motion to one for summary judgment." Northville Downs v. Granholm, 622 F.3d 579, 586 (6th Cir. 2010) (citing Commercial Money Ctr., Inc., 508 F.3d at 335-36).
The defendant argues that the plaintiffs' claims for quiet title (Count I) and breach of Michigan Compiled Laws § 600.3208 (Count II) fail because the plaintiffs have not identified any error in the foreclosure sale process or noncompliance with the statute. And even if there are defects in the foreclosure procedure, the defendant argues, the sheriff's sale is merely voidable rather than void. The defendant cite Kim v. JP Morgan Chase Bank, N.A., 493 Mich. 98, 116, 825 N.W.2d 329, 336 (2012), in support, which requires that to obtain relief from a voidable sheriff's deed, a plaintiffmust show that he was prejudiced by the failure to comply with the foreclosure proceeding and show that he would have been in a better position to preserve their interest in the property. The defendant argues that the plaintiffs have not been prejudiced nor have they alleged any prejudice in the complaint.
The plaintiffs respond that the redemption period should be tolled because Michigan law allows an equitable extension of the period with a showing of fraud or irregularity in the foreclosure sale, citing Schulthieis v. Barron, 16 Mich. App. 246, 247-48; 167 NW2d 784 (1969)). The plaintiffs also insist that they have standing to make a quiet title claim, even though the...
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