Mahoney v. Wells Fargo Bank, N.A.
| Decision Date | 29 March 2021 |
| Docket Number | CIVIL ACTION NO. 18-11593-MBB |
| Parties | CATHERINE A. MAHONEY, Plaintiff, v. WELLS FARGO BANK, N.A., Defendant. |
| Court | U.S. District Court — District of Massachusetts |
MEMORANDUM AND ORDER RE: DEFENDANT WELLS FARGO BANK, N.A.'S MOTION TO DISMISS (DOCKET ENTRY # 10); PLAINTIFF CATHERINE A. MAHONEY'S MOTION FOR LEAVE TO FILE AN AMENDED COMPLAINT (DOCKET ENTRY # 50); DEFENDANT WELLS FARGO BANK, N.A.'S MOTION TO DISSOLVE PRELIMINARY INJUNCTION, OR IN THE ALTERNATIVE, TO REQUIRE PLAINTIFF TO POST BOND AND MAKE SECURITY PAYMENTS (DOCKET ENTRY # 30)
Pending before this court is a motion to dismiss (Docket Entry # 10) filed by defendant Wells Fargo Bank, N.A. ("defendant" or "the bank") under Fed. R. Civ. P. 12(b)(6) ("Rule 12(b)(6)") and a motion to dissolve a preliminary injunction or, in the alternative, to require plaintiff to post a bond and make security payments (Docket Entry # 30) also filed by defendant. Plaintiff Catherine A. Mahoney ("plaintiff") opposes the motions. (Docket Entry ## 17, 22, 32). After a hearing (Docket Entry # 49), this court took the motions (Docket Entry ## 10, 30) under advisement. Eight days later, plaintiff filed a motion for leave to amend the complaint (Docket Entry # 50), which defendant opposes based on futility, undue delay, and an unnecessary waste of resources (Docket Entry # 52). Approximately two months later, this court held a hearing on the motion to amend and took the motion (Docket Entry # 50) under advisement.
The complaint raises the following, state law causes of action against defendant: (1) fraud (Count I); (2) intentional infliction of emotional distress ("IIED") (Count II); (3) negligent infliction of emotional distress (Count III); (4) violation of Massachusetts General Laws chapter 93A ("chapter 93A"), section nine (Count IV);1 (5) intentional misrepresentation/deceit (Count V); (6) negligent misrepresentation (Count VI); (7) negligence (Count VII); and (8) injunctive relief (Count VIII). (Docket Entry # 8-1).
Defendant moves to dismiss the complaint in its entirety (Docket Entry # 10), which plaintiff opposes (Docket Entry # 17). With respect to the motion to amend, the proposed first amended complaint ("PFAC") seeks to add additional facts primarily to support the misrepresentation claims. (Docket Entry # 51-1). It does not add any new claims.
The preliminary injunction motion seeks to dissolve a preliminary injunction entered in Massachusetts Superior Court (Suffolk County) ("state court") prior to a removal to this court. In the alternative, the motion requests that plaintiff post a bond and make security payments pursuant to Fed. R. Civ. P. 65(c). (Docket Entry # 30). The July 13, 2018 Order by the state court enjoined defendant from foreclosing on property located at 133 Beach Avenue in Hull, Massachusetts. (Docket Entry # 31-3).
To survive a Rule 12(b)(6) motion to dismiss, the complaint must contain "enough facts to state a claim to relief that is plausible on its face" even if actual proof of the facts is improbable. Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007); Miller v. Town of Wenham, Mass., 833 F.3d 46, 51 (1st Cir. 2016). The "standard is 'not akin to a "probability requirement," but it asks for more than a sheer possibility that a defendant has acted unlawfully.'" Saldivar v. Racine, 818 F.3d 14, 18 (1st Cir. 2016) (internal citations omitted).
In evaluating a Rule 12(b)(6) motion, a court may consider "'official public records; . . . documents central to plaintiffs' claim; [and] . . . documents sufficiently referred to in the complaint.'" Freeman v. Town of Hudson, 714 F.3d 29, 36 (1st Cir. 2013) (internal citation omitted). A recorded deed(Docket Entry # 11-1) and a recorded Beach Avenue Realty Trust document (Docket Entry # 11-2) attached to defendant's memorandum fall within one or more of these exceptions and are therefore part of the Rule 12(b)(6) record. See id.; Giragosian v. Ryan, 547 F.3d 59, 65-66 (1st Cir. 2008) ().
Plaintiff resides at 133 Beach Avenue in Hull ("the property"). (Docket Entry # 8-1, ¶ 1, p. 2). Defendant is a successor of World Savings Bank, FSB ("WSB"), which, after a series of name changes, mergers, or acquisitions, is presently known as Wells Fargo Home Mortgage, a division of the bank. (Docket Entry # 8-1, p. 2, ¶ 4).
Plaintiff and her deceased husband, Joseph F. Mahoney ("JFM"), purchased the property as tenants by the entirety on December 1, 1972, for $28,450. (Docket Entry # 8-1, p. 2, ¶ 7) (Docket Entry # 11-1, p. 2). On November 28, 2000, plaintiff and JFM conveyed the property to the Beach Avenue Realty Trust with themselves as co-trustees of the trust. (Docket Entry # 8-1, p. 2, ¶ 9). On October 3, 2003, WSB granted JFM, individually, a mortgage ("the 2003 mortgage") on the property secured by a $450,000 note ("the 2003 note"). (Docket Entry #8-1, pp. 2-3, ¶ 10) (Docket Entry # 8-1, pp. 28-29). The 2003 mortgage defines the borrower as and makes no reference to the Beach Avenue Realty Trust. JFM signed the mortgage simply as Joseph Mahoney. (Docket Entry # 8-1, pp. 28-29). Plaintiff, however, did not sign the 2003 mortgage, and a signature line with her name is crossed out. (Docket Entry # 8-1, pp. 2-3, ¶ 10) (Docket Entry # 8-1, p. 29).
On May 31, 2005, JFM applied to refinance the 2003 mortgage by taking out a new mortgage ("the 2005 mortgage") on the property, which he and plaintiff still owned as co-trustees, for the stated purpose in the application of receiving a "[r]educed [interest] [r]ate." (Docket Entry # 8-1, p. 4, ¶ 17) (Docket Entry # 8-1, pp. 16-19). Plaintiff did not sign either the application or the 2005 mortgage. If asked to sign the application, "she would have known the application was fraudulent" and refused to sign it. (Docket Entry # 8-1, p. 4, ¶ 19). In addition to identifying the false purpose for the loan as reducing the interest rate (Docket Entry # 8-1, p. 16), the application lists JFM's assets as $2,901,000, including real estate valued at $1,800,000 and liabilities of $504,000. (Docket Entry # 8-1, pp. 3-4, ¶¶ 12, 13, 17) (Docket Entry # 8-1, pp. 16-17). It does not include account numbers or bank addressees for the enumerated assets and cryptically denotes $185,000 as"Investments." (Docket Entry # 8-1, p. 17). The application identifies JFM's base monthly employment income as $10,000. (Docket Entry # 8-1, p. 3, ¶ 12) (Docket Entry # 8-1, p. 17). WSB used a "stated income, stated assets" documentation program that did not verify JFM's "income or assets during the loan approval process." (Docket Entry # 8-1, ¶ 30, p. 6). JFM and plaintiff's joint tax return for 2004 reports a total income of $550. (Docket Entry # 8-1, p. 21). As indicated, the 2005 application is signed by JFM but not by plaintiff. (Docket Entry # 8-1, p. 18). It discloses an interest rate of 6.07%, the $610,000 loan, and cash to borrower of $107,000. (Docket Entry # 8-1, pp. 16, 18).
On June 16, 2005, JFM and plaintiff, as co-trustees of the Beach Avenue Realty Trust, executed a quitclaim deed granting the property to JFM in his individual capacity for one dollar. (Docket Entry # 8-1, p. 37). Plaintiff was not told why she was directed to sign the deed. (Docket Entry # 8-1, p. 5, ¶ 23). On the same day, JFM signed the 2005 mortgage in his individual capacity. The 2005 mortgage reflects the transfer of the property to WSB subject to the terms of the mortgage secured by a note ("the 2005 note") in the amount of $610,000 with JFM as the borrower and WSB as the lender. (Docket Entry # 8-1, pp. 31-32). Under the 2005 note, JFM promised to make biweekly payments over a 30-year period to WSB and its successor orassignees.2 (Docket Entry # 8-1, p. 31). The 2005 mortgage reflects the higher $610,000 amount of the 2005 note, and the complaint states that "the payments to be paid on the new [2005] mortgage note were greater than the amount of the payments to be made under the existing [2003] note." (Docket Entry # 8-1, p. 4, ¶ 17) (Docket Entry # 8-1, pp. 28, 31).
The 2005 mortgage was recorded in the Plymouth County Registry of Deeds on June 17, 2005. (Docket Entry # 8-1, p. 31). The payments and, drawing reasonable inferences, the interest rate were greater for the 2005 mortgage than the payments and, drawing reasonable inferences, the interest rate for the 2003 mortgage. (Docket Entry # 8-1, pp. 16, 28, 31). At the time of the 2005 application, JFM was "seriously ill with lung disease." (Docket Entry # 8-1, p. 4, ¶ 15). On July 20, 2005, WSB discharged the 2003 mortgage and recorded the discharge in the Plymouth County Registry of Deeds a few days later. (Docket Entry # 8-1, p. 35).
On May 20, 2008, JFM died. (Docket Entry # 8-1, p. 2, ¶ 6). Plaintiff "notified the Bank and/or its predecessor of" the death and continued to make payments on the 2005 note until approximately October 2010. (Docket Entry # 8-1, pp. 5, 8, ¶¶26, 38). "Wachovia, a prior holder of the mortgage" for which defendant "is responsible," acknowledged JFM's death when it sent a letter on September 21, 2011, addressed to "the Estate of JFM Mahoney." (Docket Entry # 8-1, pp. 5-6, ¶ 27). Despite "the Bank being informed that" plaintiff was not an administratrix of JFM's estate, had not signed the 2005 mortgage, and did not wish to be contacted because she was "not well," the bank repeatedly contacted plaintiff.3 (Docket Entry # 8-1, p. 6, ¶ 28). On an ongoing basis, the bank's representatives "called the plaintiff on scores of occasions asking for her husband," inquiring about the property, and "asking questions of a personal nature." (Docket Entry # 8-1, p. 6, ¶ 28). On one day, plaintiff...
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