Malanowski v. Wells Fargo Bank
| Decision Date | 01 February 2023 |
| Docket Number | Civil Action 21-11628-MGM |
| Parties | RUTH MAGDALENA MALANOWSKI, Plaintiff, v. WELLS FARGO BANK N.A. TRUSTEE OPTION ONE MORTGAGE CORPORATION TRUST 2005-1 ASSET-BACKED-CERTIFICATES, SERIES 2005-1, Defendant. |
| Court | U.S. District Court — District of Massachusetts |
MEMORANDUM & ORDER REGARDING DEFENDANT'S MOTION FOR JUDGMENT ON THE PLEADINGS (DKT. NO. 27)
This action arises from Defendant's February 2021 foreclosure sale of Plaintiff's property after she defaulted on her mortgage loan. Liberally construed, pro se Plaintiff's Amended Petition (Dkt. No. 1-3 at 10-21, plus attachments) contains five claims related to wrongful foreclosure: (1) Defendant lacked standing to foreclose because the mortgage assignment was invalid; (2) Defendant lacked standing to foreclose because it did not sufficiently prove possession of the Note; (3) Defendant has failed to proffer evidence of any remaining mortgage debt to contradict Plaintiff's recorded affidavit purporting to invalidate the existing debt; (4) there were several deficiencies with the foreclosure proceedings, including inadequate notice of the rescheduled sale and certain agents' lack of authority to act on Defendant's behalf; and (5) violation of § 1692g of the Fair Debt Collection Practices Act (“FDCPA”) via Defendant's loan servicer's alleged failure to respond to a request for validation of her debt. Defendant now seeks judgment in its favor based on the pleadings. The court assumes the parties' familiarity with the factual background of this case. For the reasons set forth below, Defendant's Motion for Judgment on the Pleadings (Dkt. No. 27) is ALLOWED.
Having previously filed an answer, Defendants proceed on a motion for judgment on the pleadings under Rule 12(c), rather than the more typical motion to dismiss for failure to state a claim brought under Rule 12(b)(6). Fed.R.Civ.P. 12. “‘A motion for judgment on the pleadings [under Rule 12(c)] is treated much like a Rule 12(b)(6) motion to dismiss,' with the court viewing ‘the facts contained in the pleadings in the light most favorable to the nonmovant and draw[ing] all reasonable inferences therefrom.'” In re Loestrin 24 Fe Antitrust Litig., 814 F.3d 538, 549 (1st Cir. 2016) (alterations in original) (quoting Perez-Acevedo v Rivero-Cubano, 520 F.3d 26, 29 (1st Cir. 2008)). A complaint must survive a motion for judgment on the pleadings if it alleges sufficient facts “to state a claim to relief that is plausible on its face,” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007). A claim is “plausible on its face” if it “allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). However, “[a] Rule 12(c) motion, unlike a Rule 12(b)(6) motion, implicates the pleadings as a whole.” Aponte-Torres v. Univ. of P.R., 445 F.3d 50, 54-55 (1st Cir. 2006). Finally, as in the case of a motion under Rule 12(b)(6), the court is permitted to take judicial notice of public records and consider documents referred to in the complaint or integral to the plaintiff's claims. See O'Brien v. Wilmington Tr. Nat'l Ass'n as Trustee to CitiBank, N.A., 506 F.Supp.3d 82, 90-91 (D. Mass. 2020); Lu v. Memno, 98 F.Supp.3d 85, 93 (D. Mass. 2015); Curran v. Cousins, 509 F.3d 36, 44 (1st Cir. 2007) (citing Watterson v. Page, 987 F.2d 1, 3 (1st Cir. 1993)). When such documents contradict an allegation in the complaint, the document “trumps the allegation[ ].” O'Brien, 506 F.Supp.3d at 90 (citation omitted).
Plaintiff's first claim regarding the mortgage assignment is barred by res judicata. The doctrine of res judicata “makes a valid, final judgment conclusive on the parties . . . and prevents relitigation of all matters that were or could have been adjudicated in the action.” Kobrin v. Bd. Of Registration in Med., 832 N.E.2d 628, 634 (Mass. 2005) (citation omitted). “A federal court is generally bound under res judicata to give the same preclusive effect to a state court judgment as would be given to it by a local court within that state.” FPL Energy Maine Hydro LLC v. F.E.R.C., 551 F.3d 58, 63 (1st Cir. 2008). Under Massachusetts law, res judicata applies where the following three elements are satisfied: “(1) the identity or privity of the parties to the present and prior actions, (2) identity of the cause of action, and (3) prior final judgment on the merits.” Kobrin, 832 N.E.2d at 634 (citation omitted).
The Land Court's March 10, 2020 Order (Dkt. No. 29-4; see also Dkt. No. 1-3 at 15, ¶ 29), granting Defendant's motion for summary judgment, satisfies all three elements. The parties in this action were the parties to the Land Court action. The causes of action were sufficiently identical as they both arose from the same set of facts and concern the assignment of the mortgage to Defendant. See Andrew Robinson Int'l, Inc. v. Hartford Fire Ins. Co., 547 F.3d 48, 52 (1st Cir. 2008) (under Massachusetts law, causes of action or identical if they “grow[ ] out of the same transaction, act, or agreement”); see also Wenzel v. Sand Canyon Corp., 841 F.Supp.2d 463, 480 (D. Mass. 2012) (“[A] court may bar a claim under res judicata principles when title to property was at issue between the same parties (or those in privity with them) in a prior action, and is sought to be litigated in the current proceeding.”), abrogated on other grounds by Culhane v. Aurora Loan Servs. of Nebraska, 708 F.3d 282 (1st Cir. 2013). Finally, it is black-letter law that summary judgment operates as a final judgment on the merits. See Bostwick v. 44 Chestnut Street, No. 17-cv-12409, 2019 WL 6050969, at *5 (D. Mass. Nov. 15, 2019). Thus, Plaintiff's first claim regarding Defendant's status as holder of the Mortgage is precluded by res judicata. To the extent Plaintiff's other claims were or could have been raised in the Land Court action-including challenges to Defendant's possession of the Note, validity of the remaining mortgage debt, and PHH Mortgage Corporation's (“PHH”) authority to send mortgage deficiency letters in 2019 on Defendant's behalf-they too are barred.
To dispel any doubt, the court briefly addresses Plaintiff's remaining claims. The Land Court Order likewise disposes of Plaintiff's third claim. Plaintiff argues that Defendant failed to provide evidence contradicting her March 19, 2008 recorded affidavit, which purports to invalidate, discharge, and “settle” any remaining debt owed on her own mortgage. However, the Land Court Order specifically declared the March 19, 2008 affidavit null and void and of no legal effect. (Dkt. No. 29-4 at ¶ 2). That Plaintiff does not “accept” the Land Court Order does not invalidate its rulings or alter its effect on this court, particularly where Plaintiff failed to pursue an appeal.
To the extent they are not barred by res judicata, Plaintiff's second and fourth claims are also without merit. Under Massachusetts law, a foreclosing mortgage assignee (like Defendant) may establish that it held the note at the time of a foreclosure sale by filing an affidavit pursuant to Mass. G.L. c. 244, § 35C in the registry of deeds. See O'Brien, 506 F.Supp.3d at 94-95 (discussing Eaton v. Fed. Nat'l Mortg. Ass'n, 969 N.E.2d 1118, 1133 n.28 (Mass. 2012)). Defendant certified in both a recorded § 35C affidavit and a Certificate of Compliance with 209 C.M.R. § 18.21A(2)(c) dated November 10, 2020 that it held the Note. (Dkt. No. 29-7; Dkt. No. 1-3 at 184-88). As both documents were executed in compliance with Mass. G.L. c. 183, § 54B, they constitute sufficient proof under Massachusetts law that Defendant had authority to foreclose. See Jones v. Bank of N.Y. as Trustee for Certificate Holders CWABS, Inc. Asset-Backed Certificates, 542 F.Supp.3d 44, 54-55 (D. Mass. 2021) (collecting cases); McAllister v. Countrywide Home Loans, Inc., No. 16-cv-10911, 2017 WL 1173925, at *13 (D. Mass. Mar. 29, 2017). Plaintiff's other challenges to Defendant's status as holder of the Note- regarding failure to show chain of ownership of the Note and indorsement of the Note in blank-are unsupported by Massachusetts law. See O'Brien, 506 F.Supp.3d at 95 (); LaRace v. Wells Fargo Bank, N.A., 166 N.E.3d 1025, 1037 (Mass. App. Ct. 2021) (same); id. ; Carroll v. Bank of N.Y. Mellon, 83 N.E.3d 198 (Mass. App. Ct. 2017) (table) (same).
Nor has Plaintiff identified any other deficiencies with the foreclosure proceedings giving rise to a plausible claim. Plaintiff's contention that Defendant was required to “redo” the notice requirements of Mass. G.L. c 244, § 14 upon postponement of the foreclosure sale is contrary to Massachusetts law. The recorded Affidavit of Sale (Dkt. No. 29-9) constitutes prima facie evidence of compliance with § 14 prior to the initial sale date and Plaintiff has not proffered any non-conclusory factual allegations to plausibly allege a § 14 violation. Indeed, although receipt is not relevant to evaluating compliance, Plaintiff admits having received notice of the initial sale as well as the postponement. (Dkt. No. 1-3 at 183, 190). Moreover, postponement of a foreclosure sale does not require renewed compliance with § 14 and public proclamation, as referred to in Defendant's Affidavit of Sale, is a permissible way to postpone a sale, though not statutorily mandated. See Chaves v. U.S. Bank, N.A., 335 F.Supp.3d 100, 106-11 (D. Mass. 2018); Branch Ave. Capital, LLC v. U.S. Bank Nat'l Ass'n, No. 12-cv-40140, 2013 WL 5242121, at *3 (D. Mass. Sept. 16,...
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