Moore v. McCalla Raymer, LLC

Decision Date02 January 2013
Docket NumberCivil Action File No. 1:12–CV–1714–TWT.
Citation916 F.Supp.2d 1332
PartiesMarcia MOORE and All Others, Plaintiff, v. McCALLA RAYMER, LLC, et al., Defendants.
CourtU.S. District Court — Northern District of Georgia

OPINION TEXT STARTS HERE

Joshua Gilbert Davis, J.G. Davis & Associates, LLC, Atlanta, GA, for Plaintiff.

Jimmy Thomas Howell, Jr., Kimberly Anne Wright, Steven J. Flynn, McCalla Raymer, LLC, Andrew G. Phillips, Jarrod Sean Mendel, McGuireWoods LLP, Atlanta, GA, for Defendants.

ORDER

THOMAS W. THRASH, JR., District Judge.

This is an action for wrongful foreclosure. It is before the Court on the Report and Recommendation [Doc. 29] of the Magistrate Judge that the Defendants' Motions to Dismiss Amended Complaint [Doc. 16 & 20] be GRANTED. The Plaintiff's Objections are without merit for the reasons set forth in the thorough and well-reasoned Report and Recommendation. The Court approves and adopts the Report and Recommendation as the judgment of the Court. The Defendants' Motions to Dismiss Amended Complaint [Doc. 16 & 20] are GRANTED. The Defendant MERS is dismissed without prejudice. The other Defendants are dismissed with prejudice. The Motion to Dismiss Original Complaint [Doc. 6 & 10] are DENIED as moot.

FINAL REPORT AND RECOMMENDATION

JANET F. KING, United States Magistrate Judge.

Pending before the court are Defendants' motions [Docs. 6, 10] to dismiss the original complaint in this action [Doc. 1–1] and Defendants' motions [Docs. 16, 20] to dismiss Plaintiff Marcia Moore's complaint as amended [Doc. 14]. Defendants argue that the complaint(s) should be dismissed for failure to state a claim for which relief can be granted, pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure. And Defendant Mortgage Electronic Registration Systems (“MERS”) argues that Defendant should be dismissed from this action pursuant to Fed.R.Civ.P. 12(b)(5) because MERS has not been properly served. Defendants' motions [Docs. 6, 10] to dismiss the original complaint are unopposed. Plaintiff has responded [Docs. 21, 22] to Defendants' motions [Docs. 16, 20] to dismiss the complaint as amended, and Defendants have filed replies [Docs. 23, 24]. The court RECOMMENDS that the motions to dismiss [Docs. 6, 10] the original complaint be DENIED AS MOOT; that MERS' Rule 12(b)(5) motion [Doc. 16] to dismiss the amended complaint against Defendant be GRANTED; that MERS' Rule 12(b)(6) motion [Doc. 16] accordingly be DENIED because the court lacks personal jurisdiction over Defendant; and that the remaining Defendants' Rule 12(b)(6) motions [Docs. 16, 20] to dismiss the amended complaint be GRANTED.

I. Facts1

Plaintiff Moore entered into a loan agreement with Countrywide Home Loans, Inc. (“Countrywide”) in October 2005 and executed a Security Deed granting MERS (solely as nominee for Lender and Lender's successors and assigns) and the successors and assigns of MERS the property at 1408 Colony East Circle, Stone Mountain, Georgia 30083. [Complaint, ¶ 11; Doc. 20, Exhibit (“Ex.”) A, Security Deed].2 The Security Deed states: “Borrower understands and agrees that MERS holds only legal title ... but, if necessary ... has the right to exercise any or all of those interests [granted by Borrower in the Security Deed] including, but not limited to, the right to foreclose and sell the Property[.] [Security Deed at 1–2].

Plaintiff made the monthly mortgage payments on the loan for five years, until 2010 when she lost her second job. [Complaint, ¶ 13].3 She was seeking a loan modification with “BAC” and alleges that she “never received any notice as to whether she was denied [a loan modification] before she was foreclosed upon.” [ Id., ¶ 14; Doc. 20, Ex. C, Notice of Foreclosure (“Notice”) ]. On or about May 17, 2010, Plaintiff received a Notice of Foreclosure Sale from McCalla Raymer, LLC (McCalla) stating that BACHLS, “fka Countrywide Home Loans Servicing LP,” was foreclosing on the property. [Complaint, ¶ 15]. She alleges that the Notice identifies the loan servicer as her “creditor.” [ Id.].

The Notice identifies the loan by inter alia a “Servicing Lender's # .” [Notice, Doc. 20, Ex. C]. A copy of the Notice of Sale submitted for publication in the legal newspaper showing foreclosure sale scheduled for the first Tuesday in July 2010 is referenced as enclosed. [ Id. at 2]. “Bank of America” is identified as the entity with the full authority to negotiate, amend, and modify the terms of the mortgage, and Plaintiff is given information on who to contact to find out more about the foreclosure or if reinstatement of her loan might be allowed. [ Id.].4

On April 12, 2010, one month before the Notice of Foreclosure to Plaintiff, MERS, acting as Countrywide's nominee, assigned to BACHLS the “Security Deed, the property described therein, and the indebtedness secured thereby” and stated therein that it had also sold and assigned to BACHLS “the note secured by the aforesaid Security Deed ... to secure the Assignee, its successors, representatives and assigns, in the payment of said note.” [Complaint, Ex. B, Assignment, recorded on June 21, 2010, at Deed Book 22013, Page 340, Clerk of Superior Court, DeKalb County]. C. Troy Crouse and Thomas Sears,” attorneys with McCalla, signed the Assignment as a “Vice President” and “Assistant Secretary” of MERS; their signatures are witnessed; and the Assignment is notarized. [ Id.].

The property was sold at foreclosure on July 6, 2010, to BACHLS, as evidenced by a Deed Under Power which states “in witness whereof, Lender as Agent and Attorney in Fact for Borrower has hereunto affixed Lender's hand and seal.” [Complaint, Exs. E & E1, Deed Under Power, recorded August 2, 2010, at Book 22068, Page 421].5 The Deed Under Power bears the corporate seal of BACHLS and is signed by Timothy E. Moran—Assist. Vice President” and Barbara Komisarof—Assist. Vice President” for BACHLS, as “attorney in fact” for Maria C. Moore.” A “ *Corrective* Deed Under Power” was recorded at Deed Book 22094, Page 480, on August 18, 2010, to reflect that the borrower's first name is “Marcia.” [ Id., Exs. F & F1].

On or about March 21, 2012, six-hundred-and-twenty-four days after foreclosure, Plaintiff received a letter from McCalla stating that the property had been foreclosed upon on July 6, 2010, and that she needed to vacate the property. [ Id., ¶ 23]. Plaintiff filed this action on April 10, 2012, in the Superior Court of DeKalb County, Georgia, alleging inter alia that she “had never received any communication concerning the confirmation of the foreclosure sale[.] [Doc. 1–1].6 Bank of America, N.A. (“BANA”), the successor-by-merger to Defendant BACHLS,7 and MERS filed notice of removal of the Superior Court action on May 16, 2012, based on federal question(s) in the complaint. [Docs. 1, 1–1].8

After Defendants filed motions [Docs. 6, 10] to dismiss the complaint, Plaintiff filed an amended complaint [Doc. 14].9 The complaint, as amended, contains claims for wrongful foreclosure (Count I), constructive fraud (Count II), and violation of the Fair Debt Collection Practices Act (“FDCPA”), 15 U.S.C. § 1692a(6), (Count III). [Doc. 14]. Plaintiff seeks compensatory and punitive damages in excess of $500,000 and attorney fees and costs (Count IV) plus injunctive relief (Count V). [ Id.]. Each claim in the complaint is based on Plaintiff's general allegations that Crouse's and Sears' signatures look different from their signatures in other transactions which “bring[s] into question [their] actual attestation” of the Assignment and that such “forged” signatures and “no Power of Attorney ... to sign [for MERS] causes the “transfer of the property from MERS to BAC to fail ... and the foreclosure by BAC to be wrongful.” [ Id., ¶¶ 17–19].

Additional facts will be taken into consideration as needed to address the merits of the motions pending before the court. The court must first address MERS' Rule 12(b)(5) motion to be dismissed from this action. ‘Service of process is a jurisdictional requirement: a court lacks jurisdiction over the person of a defendant when the defendant has not been served.’ ... Therefore, where a court finds insufficient service, it is ‘improper for the district court to ... reach[ ] the merits in th[e] case and to ... issue[ ] a dismissal with prejudice[ ] as to that defendant. Pelmore v. Pinestate Mortg. Corp., 2010 WL 520767, at *2 (N.D.Ga. February 8, 2010) (citations omitted).

II. Rule 12(b)(5)

Plaintiff attempted to serve MERS before removal by hand delivering a copy of the complaint and summons to a William K. Davidson.” [Doc. 1–1 at 27–28, Certificate of Service]. A Rule 12(b)(5) motion challenging sufficiency of service ‘must be specific and must point out in what manner the plaintiff has failed to satisfy the requirements of the service provision utilized.’ Binns v. City of Marietta Housing Authority, 2007 WL 2746695, at *2 (N.D.Ga. September 18, 2007) (citation omitted); see also Ritts v. Dealers Alliance Credit Corp., 989 F.Supp. 1475, 1478 (N.D.Ga.1997) (“The party challenging the sufficiency of the service bears the burden of showing it was improper.”) (citation omitted). MERS contends that it was not properly served because Plaintiff did not serve on “an officer, a managing or general agent, or any other agent authorized by appointment or by law to receive service of process for MERS” as required under Fed.R.Civ.P. 4(h)(1). [Docs. 10 at 10, 16 at 11 (internal quotation marks omitted) ].

“In actions removed from state court, the sufficiency of service of process prior to removal is determined by the law of the state from which the action was removed.” Rentz v. Swift Transportation Co., Inc., 185 F.R.D. 693, 696 (M.D.Ga.1998). “After removal the sufficiency of service of process is determined according to federal law.” Id. at 696 (citing 28 U.S.C. § 1448). Federal Rule of Civil Procedure 4(h)(1) provides, in pertinent part:

Unless federal law provides otherwise ..., a domestic or foreign...

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