Tait v. Nationstar Mortg. LLC
| Decision Date | 30 September 2015 |
| Docket Number | CIVIL ACTION NO. 1:14-CV-2885-CC |
| Court | U.S. District Court — Northern District of Georgia |
| Parties | PHYLLIS TAIT and TIFFANY MINOTT, Plaintiffs, v. NATIONSTAR MORTGAGE LLC, BNY MELLON, NATIONAL ASSOCIATION, and DEFENDANT DOE, Defendants. |
This lawsuit, which arises from an alleged foreclosure sale of real property that is the second home of Plaintiffs Phyllis Tait and Tiffany Minott ("Plaintiffs"), is before the Court on the Report and Recommendation [Doc. No. 15] issued by Chief Magistrate Judge Linda T. Walker on August 19, 2015. In the Report and Recommendation, Chief Magistrate Judge Walker recommends that the Court grant Defendants Nationstar Mortgage LLC and BNY Mellon, National Association's Partial Motion to Dismiss [Doc. No. 3]. Specifically, Chief Magistrate Judge Walker recommends that the Court dismiss Plaintiffs' claims of wrongful foreclosure, breach of contract, breach of the duties of good faith and fair dealing, promissory estoppel, fraud, fraudulent misrepresentation, negligent misrepresentation, and declaratory judgment.
On September 2, 2015, Plaintiffs filed Objections to the United States Magistrate Judge's Final Report and Recommendation [Doc. No. 17].1 Plaintiffs assert in the objections that Chief Magistrate Judge Walker failed to accept the factsalleged by Plaintiffs as true, failed to analyze the sufficiency of the pleading utilizing the notice pleading standard set forth in Federal Rule of Civil Procedure 8(a)(2), and erroneously accepted facts alleged by Defendants as true. In doing so, according to Plaintiffs, Chief Magistrate Judge Walker erred in recommending dismissal of Plaintiffs' claims of wrongful foreclosure, promissory estoppel, fraud, fraudulent misrepresentation, negligent misrepresentation, and declaratory judgment. While Plaintiffs cursorily mention in their discussion of the promissory estoppel claim that Defendant Nationstar allegedly breached a contract, Plaintiffs do not specifically object to Chief Magistrate Judge Walker's recommendation that the breach of contract and breach of the duties of good faith and fair dealing claims be dismissed.
On September 21, 2015, the Court received Nationstar Mortgage LLC and BNY Mellon, National Association's Response to Plaintiffs' Objection to the Magistrate Court's August 19, 2015 Report and Recommendation [Doc. No. 18]. Defendants maintain that Chief Magistrate Judge Walker resolved the Partial Motion to Dismiss correctly based on her finding that Plaintiffs did not sufficiently allege that a wrongful foreclosure sale occurred. Additionally, Defendants emphasize that Chief Magistrate Walker repeatedly found that Plaintiffs did not plead any damages they suffered as a result of the alleged foreclosure.
The Report and Recommendation, Plaintiffs' objections thereto, and Defendants' response to Plaintiffs' objections are ripe for the Court's review. After reviewing a magistrate judge's findings and recommendations, a district judge may accept, reject, or modify the findings or recommendations. 28 U.S.C. § 636(b)(1). A party challenging a report and recommendation must "file . . . written objections which shall specifically identify the portions of the proposed findings and recommendation to which objection is made and the specific basis for objection." Macort v. Prem, Inc., 208 F. App'x 781, 783 (11th Cir. 2006) (citation and internal quotation marks omitted); see also Fed. R. Civ. P. 72(b)(2). A district judge "shall make a de novo determination of those portions of the report or specified proposedfindings or recommendations to which objection is made." Jeffrey S. v. State Bd. of Educ. of Ga., 896 F.2d 507, 512 (11th Cir. 1990) (citation omitted). The district judge must "give fresh consideration to those issues to which specific objection has been made by a party." Id. "Frivolous, conclusive, or general objections need not be considered by the district court." Marsden v. Moore, 847 F.2d 1536, 1548 (11th Cir. 1988) (citation omitted). Those portions of a report and recommendation to which an objection has not been made are reviewed for plain error. United States v. Slay, 714 F.2d 1093, 1095 (11th Cir. 1983).
Plaintiffs' main objection to the Report and Recommendation is that Chief Magistrate Judge Walker, in recommending that the majority of Plaintiffs' claims be dismissed, purportedly relied on a representation by Defendant Nationstar that the foreclosure sale at issue in this case was never consummated and concluded, as a result, that there had been no change to Plaintiffs' property interests and no damages suffered by Plaintiffs in connection with the foreclosure sale. This Court has conducted a thorough review of the entire record of this case and has carefully examined the allegations in Plaintiffs' Complaint and the attachments to the Complaint. Having done so, the Court finds no plain error with respect to Chief Magistrate Judge Walker's recommended dismissal of the breach of contract and breach of the duties of good faith and fair dealing claims and, upon de novo review, concludes that Chief Magistrate Judge Walker correctly recommended dismissal of Plaintiffs' claims of wrongful foreclosure, promissory estoppel, fraud, fraudulent misrepresentation, negligent misrepresentation, and declaratory judgment.
Plaintiffs' claims of wrongful foreclosure, fraud, fraudulent misrepresentation, and negligent misrepresentation are due to be dismissed not based on any representation by Defendants that the foreclosure sale was not consummated but based on Plaintiffs' failure to allege facts indicating that the foreclosure sale was consummated. As Chief Magistrate Judge Walker reasoned, to properly allege claims for wrongful foreclosure, fraud, fraudulent misrepresentation, and negligentmisrepresentation, a plaintiff must allege sufficient facts to indicate, among other things, that an injury occurred and that plaintiff sustained damages. Brown v. Federal Nat'l Mortg. Ass'n, No. 10-CV-03289, 2011 WL 1134716, at *6 (N.D. Ga. Feb. 28, 2011) (wrongful foreclosure); Uhlig v. Darby Bank & Trust Co., 556 F. App'x 883, 888-89 (11th Cir. 2014) (); Next Century Commc'ns. Corp. v. Ellis, 318 F.3d. 1023, 1027, 1030 (11th Cir. 2003) (). Under Georgia law, a foreclosure sale has not occurred until the sale is consummated. Tampa Inv. Grp. v. Branch Banking & Trust Co., 290 Ga. 724, 727, 723 S.E.2d 674 (2012) (). For a foreclosure sale to be consummated, a deed must be transferred and the proceeds of the foreclosure sale must be transferred from the bidder to the creditor and applied to reduce the borrower's debt. Bldg. Block Enters. v. State Bank and Trust Co., 314 Ga. App. 147, 150-51, 723 S.E.2d 467 (2012); Legacy Communities Grp. v. Branch Banking & Trust Co., 310 Ga. App. 466, 470, 713 S.E.2d 670 (2011), rev'd in part on other grounds, Tampa Inv. Grp. v. Branch Banking & Trust Co., 290 Ga. 724, 723 S.E.2d 674 (2012). Here, Plaintiffs have not alleged either that the deed under power was transferred or that the proceeds of the foreclosure sale were applied to reduce their debt. As such, Plaintiffs have not adequately alleged that a foreclosure sale occurred or that they suffered any damages or economic injury. These pleading deficiencies are fatal to the wrongful foreclosure, fraud, fraudulent misrepresentation, and negligent misrepresentation claims.
In addition to Plaintiffs' failure to allege the consummation of the foreclosure sale, one of Plaintiffs' own attachments to the Complaint indicates that Defendant Nationstar rescinded the foreclosure sale. In this regard, Exhibit R to Plaintiffs' Complaint is a letter in which Defendant Nationstar states that a foreclosure sale occurred but was rescinded. In bringing the claims in the instant lawsuit, Plaintiffs rely heavily on Defendant Nationstar's representation in the letter that a foreclosuresale did occur on May 1, 2012, but Plaintiffs unconvincingly...
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