Smith-Tyler v. Bank of Am., N.A.

• Decision Date: 16 January 2014
• Docket Number: Civil Action File No. 1:12–CV–1347–TWT.
• Citation: 992 F.Supp.2d 1277
• Parties: Helen SMITH–TYLER, Plaintiff, v. BANK OF AMERICA, N.A., et al., Defendants.
• Court: U.S. District Court — Northern District of Georgia

992 F.Supp.2d 1277

Helen SMITH–TYLER, Plaintiff,

v.BANK OF AMERICA, N.A., et al., Defendants.

Civil Action File No. 1:12–CV–1347–TWT.

United States District Court,

N.D. Georgia,

Atlanta Division.

Jan. 16, 2014.

Joy D. Nesmith, Baxter, Nesmith, & Fleming, LLC, Atlanta, GA, for Plaintiff.

Elizabeth J. Campbell, Locke Lord LLP, Atlanta, GA, for Defendant.

OPINION AND ORDER

THOMAS W. THRASH, JR., District Judge.

This is an action for fraud and wrongful foreclosure. It is before the Court on the Plaintiff's Motion for Summary Judgment [Doc. 64] and the Defendant's Motion for Summary Judgment [Doc. 65]. For the reasons set forth below, the Plaintiff's Motion for Summary Judgment [Doc. 64] is DENIED and the Defendant's Motion for Summary Judgment [Doc. 65] is GRANTED.

I. Background

In June of 1997, the Plaintiff bought a home in Lithonia, Georgia (the “Property”). (Def.'s Statement of Facts ¶ 1.) On July 23, 2004, she obtained a loan from the Taylor, Bean & Whitaker Mortgage Corporation (“TBW”). (Pl.'s Statement of Facts ¶ 1.) The Plaintiff pledged the Property as collateral by executing a security deed (“2004 deed”) to Mortgage Electronic Registration Systems, Inc. (MERS), TBW's nominee. (Def.'s Statement of Facts ¶ 3.) The 2004 deed was recorded in the DeKalb County property records. (Def.'s Statement of Facts ¶ 4.) On July 27, 2009, the Plaintiff refinanced the TBW loan with Platinum Community Bank. (Pl.'s Statement of Facts ¶ 3.) As part of the transaction, the Plaintiff executed a security deed (“2009 deed”) to MERS, the nominee of Platinum. (Pl.'s Statement of Facts ¶ 8.) The 2009 deed was also recorded in the DeKalb County property records. (Def.'s Statement of Facts ¶ 9.)

On August 4, 2009, the U.S. Department of Housing and Urban Development (HUD), the Federal Home Loan Mortgage Corporation (Freddie Mac), and the Government National Mortgage Association (Ginnie Mae) shut down TBW. (Def.'s Statement of Facts ¶ 11.) TBW's loans were transferred to other entities. (Def.'s Statement of Facts ¶ 12.) Ginnie Mae requested that the Defendant assume servicing of roughly 180,000 of these loans, which included the Plaintiff's 2004 loan from TBW. (Def.'s Statement of Facts ¶¶ 13–14.) At the time, TBW's records listed the Plaintiff's 2004 loan as active. (Def.'s Statement of Facts ¶ 15.)

The Defendant notified the Plaintiff that it was the new servicer of her loan. (Pl.'s Statement of Facts ¶ 5.) However, the Plaintiff was then contacted by another entity, RoundPoint Mortgage, LLC, which was also claiming to be the servicer of her loan. (Pl.'s Statement of Facts ¶ 6.) The Plaintiff then had a conference call with representatives of both the Defendant and RoundPoint, and she was told to make payments to the Defendant. (Pl.'s Statement of Facts ¶ 8.)

Operating under the belief that it was servicing an active loan, the Defendant began foreclosure proceedings once the Plaintiff fell behind on her payments. (Def.'s Statement of Facts ¶ 22.) The Defendant hired McCalla Raymer to handle the foreclosure. (Def.'s Statement of Facts ¶ 22.) McCalla Raymer sent the Plaintiff a notice of foreclosure sale dated March 2, 2010. (Pl.'s Statement of Facts ¶ 13.) On April 5, 2010, the Plaintiff filed for bankruptcy. (Pl.'s Statement of Facts ¶ 14.) At the time, the Plaintiff had around $182,141.00 of unsecured debt in addition to any secured debt. (Def.'s Statement of Facts ¶ 27.)

The Defendant filed two proof of claims in the Plaintiff's bankruptcy proceeding. (Pl.'s Statement of Facts ¶ 18.) Because the Defendant maintained that it was servicing an active loan, the Plaintiff continued to make post-petition payments to the Defendant. (Pl.'s Statement of Facts ¶¶ 20–21.) During the bankruptcy proceeding, however, it was discovered that the 2004 loan had been paid off through the 2009 refinancing with Platinum. (Def.'s Statement of Facts ¶ 36.) The Defendant then entered into a consent agreement where it returned the money it received from the Plaintiff, with interest. (Pl.'s Statement of Facts ¶ 26; Def.'s Statement of Facts ¶ 38.) In this action, the Plaintiff asserts claims for wrongful foreclosure, intentional infliction of emotional distress, fraud, and negligence. Both the Plaintiff and the Defendant have moved for summary judgment on all claims.

II. Legal Standard

Summary judgment is appropriate only when the pleadings, depositions, and affidavits submitted by the parties show that no genuine issue of material fact exists and that the movant is entitled to judgment as a matter of law. Fed.R.Civ.P. 56(c). The court should view the evidence and any inferences that may be drawn in the light most favorable to the nonmovant. Adickes v. S.H. Kress & Co., 398 U.S. 144, 158–59, 90 S.Ct. 1598, 26 L.Ed.2d 142 (1970). The party seeking summary judgment must first identify grounds that show the absence of a genuine issue of material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 323–24, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). The burden then shifts to the nonmovant, who must go beyond the pleadings and present affirmative evidence to show that a genuine issue of material fact does exist. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 257, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). “A mere ‘scintilla’ of evidence supporting the opposing party's position will not suffice; there must be enough of a showing that the jury could reasonably find for that party.” Walker v. Darby, 911 F.2d 1573, 1577 (11th Cir.1990).

III. Discussion

A. Wrongful Foreclosure

The Plaintiff's claim for wrongful foreclosure must fail because there was no actual foreclosure. See Roper v. Parcel of Land, 1:09–CV–0312–RWS, 2010 WL 1691836, at *2 (N.D.Ga. Apr. 23, 2010) (“Because Defendants did not proceed with the foreclosure after Plaintiff filed the present action, Plaintiff cannot prove a claim for wrongful foreclosure.”); Aetna Fin. Co. v. Culpepper, 171 Ga.App. 315, 319, 320 S.E.2d 228 (1984) (“[S]ince Mrs. Culpepper filed bankruptcy proceedings, thereby preventing any sale of the property, she suffered no legal injury and proved no actual damages.”). The Plaintiff then attempts to convert her claim into one of wrongful attempted foreclosure. In Georgia, “courts have recognized a cause of action for wrongful attempted foreclosure when a foreclosure action was commenced, but not completed, where plaintiffs have shown that a defendant ‘knowingly published an untrue and derogatory statement concerning the plaintiffs' financial conditions and that damages were sustained as a direct result.’ ” Morgan v. Ocwen Loan Servicing, LLC, 795 F.Supp.2d 1370, 1377 (N.D.Ga.2011) (citing Sale City Peanut & Milling Co. v. Planters & Citizens Bank, 107 Ga.App. 463, 465, 130 S.E.2d 518 (1963)).

Here, the Plaintiff provides no evidence that the Defendant knew that the loan had been satisfied when it initiated foreclosure proceedings. Consequently, there is no evidence that the Defendant knew that any published foreclosure notice contained incorrect statements. The Plaintiff does not refute the Defendant's evidence that TBW's records marked the Plaintiff's 2004 loan as active. (Def.'s Mot. to Dismiss, Ex. J.) In response, the Plaintiff first argues that she put the Defendant on notice that there was another entity claiming to be the rightful servicer. (Pl.'s Resp. to Def.'s Mot. for Summ. J., at 8.) But this does not mean the Defendant knew that the 2004 loan had been satisfied. In fact, the Plaintiff and the Defendant had a conference call with RoundPoint where the parties appeared to believe that the Defendant was the servicer of an active loan. The Plaintiff then argues that the Defendant “knew or should have known that it was highly plausible that they were not the rightful servicer.” (Pl.'s Resp. to Def.'s Mot. for Summ. J., at 8–9.) The Plaintiff, however, has to show actual knowledge. SeeAetna Fin. Co., 171 Ga.App. at 319, 320 S.E.2d 228 (“Those decisions upon which Mrs. Culpepper relies to support her contention that she could recover damages for a wrongful attempted foreclosure require a knowing and intentional publication of untrue and derogatory information concerning the debtor's financial condition.”). The Defendant's summary judgment motion should be granted as to the Plaintiff's wrongful foreclosure and wrongful attempted foreclosure claims.

B. Intentional Infliction of Emotional Distress

Under Georgia law, a claim of intentional infliction of emotional distress contains the following elements: “(1) The conduct must be intentional or reckless; (2) The conduct must be extreme and outrageous; (3) There must be a causal connection between the wrongful conduct and the emotional distress; and (4) The emotional distress must be severe.” United Parcel Service v. Moore, 238 Ga.App. 376, 377, 519 S.E.2d 15 (1999). In order to be sufficiently extreme and outrageous, the conduct must “go beyond all reasonable bounds of decency so as to be regarded as atrocious and utterly intolerable in a civilized community.” Id. Actionable conduct generally does not include “mere insults, indignities, threats, annoyances, petty oppressions, or other vicissitudes of daily living.” Id. Whether reasonable persons could find that the conduct reaches this level is a question of law for the court. Seeid.; Racette v. Bank of America, N.A., 318 Ga.App. 171, 179, 733 S.E.2d 457 (2012) (“Whether a claim rises to the requisite level of outrageousness and egregiousness to sustain a claim for intentional infliction of emotional distress is a question of law.”).

First, the Plaintiff has no evidence that the Defendant intended to inflict emotional distress, or that it was reckless as to the possibility. As explained earlier, the Defendant had reason to believe it was collecting on an active loan. Consequently, the Plaintiff's claim fails as a matter of law. See Roddy v. Tanner Med. Ctr., Inc., 262 Ga.App. 202, 205, 585 S.E.2d 175 (2003) (“[T]he tort of ‘intentional infliction of emotional distress,’ as its name...