Wesner v. Southall
| Decision Date | 18 April 2023 |
| Docket Number | Civil Action 3:22-CV-0927-B |
| Parties | CHARLES THOMAS WESNER, JR., as Trustee of the Charles Wesner, Jr. Living Trust, Plaintiff, v. MARK SOUTHALL, PRINCIPLE MANAGEMENT GROUP INC., ASSOCIATIONS INC. d/b/a ASSOCIA, ESTATES OF WINDSOR RIDGE HOMEOWNERS' ASSOCIATION INC., ASSOCIA CLIENT SHARED SERVICE CENTER INC. d/b/a CSSA, WHITTEN AND WHITTEN PLLC, and ADAM T. WHITTEN, Defendants. |
| Court | U.S. District Court — Northern District of Texas |
Before the Court are five motions to dismiss: Defendants Whitten & Whitten, PLLC (“Whitten Firm”) and Adam Whitten (“Whitten”) (collectively, “Whitten Defendants”)'s Motion to Dismiss (Doc. 40) Defendants Associations, Inc. (“Associa”) and Associa Client Shared Service Center, Inc. (“CSSC”)'s Motion to Dismiss (Doc. 41) Defendant Principal Management Group, Inc. (“PMG”)'s Motion to Dismiss (Doc. 42) Defendant Mark Southall's Motion to Dismiss (Doc. 43) and Defendant Estates of Windsor Ridge Homeowners' Association, Inc. (“Estates of Windsor Ridge”)'s Motion to Dismiss (Doc. 44).[1] As explained below, the Motions are GRANTED in part and DENIED in part.
Specifically, Plaintiff Charles Thomas Wesner, Jr.'s claims for declaratory judgment against all Defendants; his claims against Estates of Windsor Ridge for violation of the Texas Fair Debt Collections Act, breach of contract, and tortious interference of contract; his claims against Associa and CSSC for tortious interference with contract; and his claims against PMG and Southall for tortious interference with contract, fraud, and conspiracy to commit fraud all survive. Wesner's other claims are DISMISSED WITHOUT PREJUDICE.
William Shakespeare famously posited, “A rose by any other name would smell as sweet.” Romeo and Juliet, Act II, Scene II, lines 43-44. This case raises an analogous question: whether a homeowner's association (“HOA”) by any other name can still impose HOA fees. Plaintiff Charles Thomas Wesner, Jr. is trustee of the Charles Thomas Wesner, Jr. Living Trust (the “Trust”) and the record owner of 2312 Lookout Lane (the “Property”) in Denton, Texas. Doc. 38, Am. Compl., ¶¶ 1.01, 3.02. The Property is part of the Windsor Ridge subdivision. Id. ¶ 3.02. Like many subdivisions, Windsor Ridge subdivision has an HOA. See Id. ¶¶ 2.01, 3.03.
The Windsor Ridge HOA management certificates state the name of the HOA is “Windsor Ridge Homeowners Association.” Id. ¶ 3.03. Collectively, Associa, CSSC, and PMG purported to be the management company for the HOA. Id. ¶ 2.07. Wesner alleges he received “at least 60” HOA-related assessments that were either falsely sent in the name of “Windsor Ridge Homeowners Association”-the “real” HOA-or were sent in the name of another entity. Id. ¶¶ 3.01, 3.34. He cites Estates of Windsor Ridge, “Windsor Ridge HOA, Inc.,” and “Windsor Ridge Homeowners' Association, Inc.” as examples of entities that “are not a homeowner's association for the Windsor Ridge owners” but nonetheless charged him assessments. Id. ¶ 3.01. Wesner alleges he is not a member of these entities, and they are not authorized to collect assessments from him. Id.
Wesner purchased the Property on January 8, 2018, as a residence for a Trust beneficiary, Cesar Rosales. Id. ¶ 3.02. As a lot owner in Windsor Ridge subdivision, Wesner is an automatic member of the Windsor Ridge Homeowners' Association. Id. ¶ 2.01. In September 2018, Wesner received an invoice for $681.94 from “Windsor Ridge c/o [PMG].” Id. ¶ 3.10. Wesner called Southall, the president of PMG, and objected to the charge. Id. ¶ 3.11. Southall explained the invoice included a $200 assessment that the previous owner failed to pay. Id. ¶ 3.14. He promised to send Wesner a separate invoice for the $200 balance, which Wesner could pay without prejudice as to verification of the assessment amount. Id. ¶ 3.15. Later that day, Southall sent Wesner a copy of the Declaration of Covenants, Conditions and Restrictions (“CCR”) that governed the Windsor Ridge subdivision. Id. ¶ 3.17. Thereafter, PMG sent Wesner the 2018 account history for the Property, which showed an account balance of $200 owed by Wesner. Id. ¶ 3.38.
About a month later, Wesner sent Southall a letter and enclosed a check for $200. Id. ¶ 3.37. In the letter, he stated that he was tendering the check “for Windsor Ridge . . . in reliance on my gentlemen's agreement with [Southall] for PMG, as the Managing Agent, for PMG and Windsor Ridge to follow the law and fairly treat all Members.” Id. PMG deposited this check into the account for Estates of Windsor Ridge, which Wesner alleges is not the real HOA for the subdivision. Id. ¶ 3.39.
At some point, Wesner became suspicious that something nefarious was going on. He began making various document requests to PMG, Southall, Associa, and CSSC, requiring proof of the HOA's incorporation, the legality of transfer fees, and the actual expenses of the HOA, among other things. See id. ¶¶ 3.24, 3.26, 3.28-.29, 3.32, 3.36, 3.41-.50, 3.73, 3.76, 3.79-.82, 3.90-.91, 3.99-.100, 3.105, 3.112-.113, 3.120. None of these requests were answered to his satisfaction. See id. Although Wesner was sent proof of incorporation for Estates of Windsor Ridge, Wesner alleges, “Estates [of Windsor Ridge] is not in the [governing documents for the subdivision] and is not a committee, officer or employee of Windsor Ridge Homeowners' Association, the ‘Homeowners' Association' . . . required by the [governing documents].” Id. ¶ 3.61; see also id. ¶ 3.49.
PMG informed Wesner that Estates of Windsor Ridge had engaged Whitten as an attorney “in respect to [Wesner's] document requests.” See id. ¶¶ 3.50, 3.84, 3.92. In early February 2019, Whitten and Wesner met to discuss Wesner's issues with the assessments. See id. ¶¶ 3.85-.86, 3.95. Before the meeting, Whitten explained that he understood Wesner's chief concern to be the legal status of the HOA entity and suggested that issue should be addressed first. Id. ¶ 3.94. Whitten and Wesner met but were unable to resolve the dispute. See id. ¶¶ 3.95, 3.101. Whitten asked Wesner three times by email to pay his assessments. Id. ¶ 3.121. Whitten was eventually terminated from this representation. Id. ¶ 3.104.
On April 26, 2021, Estates and PMG held a hearing with Wesner regarding the assessments, but the hearing ended without resolution of the issues. Id. ¶¶ 3.110-.111, 3.114. The parties were unable to resolve their dispute, and Wesner has continued to receive invoices from Estates of Windsor Ridge, Associa, and PMG. Id. ¶ 3.101. The total amount sought is $836.97. Id. ¶ 3.117.
On April 26, 2022, Wesner sued current Defendants and now-dismissed Defendants Wyatt Francis, Susan Denney, Lisa Hildinger, and Scott Martin in this Court. Doc. 1, Compl. He alleged violations of the Federal Debt Collection Practices Act, the Texas Fair Debt Collection Act, and Texas Deceptive Trade Practices Act, breaches of fiduciary duty and contract, usury, intentional interference with contract, fraud, and a declaratory judgment. Id. Francis, Denney, Hildinger, and Martin were never served with process, and the Court dismissed the claims against them. Doc. 26, Order. The remaining Defendants filed motions to dismiss (Docs. 14, 17-19, 23). Wesner sought leave to amend, which the Court granted. Doc. 35, Order. Wesner filed his Amended Complaint (Doc. 38), which Defendants moved to dismiss (Docs. 40-44).[2] The Court considers these Motions to Dismiss (Docs. 40-44) below.
Under Federal Rule of Civil Procedure 8(a)(2), a complaint must contain “a short and plain statement of the claim showing that the pleader is entitled to relief.” Fed.R.Civ.P. 8(a)(2). Rule 12(b)(6) authorizes a court to dismiss a plaintiff's complaint for “failure to state a claim upon which relief can be granted.” Fed.R.Civ.P. 12(b)(6). In considering a Rule 12(b)(6) motion to dismiss, “the Court must accept all well-pleaded facts as true, and view them in the light most favorable to the plaintiff.” Walker v. Beaumont Indep. Sch. Dist., 938 F.3d 724, 735 (5th Cir. 2019) (alterations and internal quotations omitted). But the Court will “not look beyond the face of the pleadings to determine whether relief should be granted based on the alleged facts.” Spivey v. Robertson, 197 F.3d 772, 774 (5th Cir. 1999).
To survive a motion to dismiss, plaintiff's must plead “enough facts to state a claim to relief that is plausible on its face.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007). “Threadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice.” Ashcroftv. Iqbal, 556 U.S. 662, 678 (2009). “A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Id. “The plausibility standard is not akin to a ‘probability requirement,' but it asks for more than a sheer possibility that a defendant has acted unlawfully.” Id. (quoting Twombly, 550 U.S. at 556). When well-pleaded facts fail to meet this standard, “the complaint has alleged-but it has not shown-that the pleader is entitled to relief.” Id. at 679 (alteration and internal quotations omitted).
Because attorney immunity is an absolute defense, the Court first addresses whether Whitten Defendants are entitled to attorney immunity. The Court then considers Wesner's claims. Finally, the Court addresses whether to grant Wesner leave to amend his complaint.
Whitten Defendants assert attorney immunity bars Wesner's claims against them because “all of Whitten[] [Defendants'] actions are ‘the kind of conduct' attorneys...
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