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Waites v. Wells Fargo Bank, N.A.

United States District Court, E.D. Virginia, Norfolk Division

February 16, 2016

WELLS FARGO BANK, N.A., Defendant.



This matter is before the Court on an amended motion to dismiss, filed by Wells Fargo Bank, N.A., ("Defendant" or "Wells Fargo") pursuant to Rule 12 (b) (6) of the Federal Rules of Civil Procedure. ECF No. 13. After examining the briefs and the record, the Court determines that oral argument is unnecessary because the facts and legal contentions are adequately presented. Fed.R.Civ.P. 78(b); E.D. Va. Loc. R. 7(J).


The instant civil suit was initially filed in the Circuit Court for the City of Norfolk, Virginia. It was thereafter removed to this Court pursuant to the Court's diversity jurisdiction, and neither the propriety of removal, nor this Court's jurisdiction, are in question.

As set forth in the civil complaint filed by Cardissia Waites ("Plaintiff"), the instant action arises out of Plaintiff's failure to timely pay her mortgage payments, which ultimately led to the foreclosure of her home. Compl. ¶¶ 6-7, ECF No. 1-2. After Plaintiff fell more than three months behind on her payments to Defendant, on "April 25, 2010, Plaintiff and Defendant executed 'Special Forbearance Agreement' where Plaintiff would be allowed to make monthly reduced payments of $579.41 beginning May 15, 2010." Id. ¶ 8. The forbearance period was scheduled to end on September 15, 2010, at which time all past due payments (approximately $20, 000) were due. Id. ¶ 8 & Ex.B. In conjunction with signing the forbearance agreement, Plaintiff submitted a check to Defendant far exceeding the required $ 579.41 forbearance payment, but due entirely to Defendant's error processing such check, the timely payment was rejected. Id. ¶¶ 10-16. Mistakenly believing that Plaintiff lacked sufficient funds to cover the first forbearance check, Defendant declared in a written notice dated May 28, 2010, that Plaintiff had failed to comply with the terms of the forbearance agreement. Id. ¶ 17 & Ex.F. Defendant therefore resumed foreclosure activities, rejected Plaintiff's subsequent attempts to make additional payments under the terms of the forbearance agreement, and ultimately caused the foreclosure sale of Plaintiff's home on July 7, 2010. Id. ¶¶ 17-22.

Plaintiff filed the instant action on July 7, 2015, exactly five years after the foreclosure sale, alleging violations of the note/deed of trust (Counts I and III) and violations of the forbearance agreement (Counts II and IV). Defendant thereafter removed the case to this Court and filed a motion to dismiss. Defendant was subsequently given leave to file the amended motion to dismiss currently pending before this Court, and such motion is now fully briefed and ripe for adjudication.


Neither party's briefing calls into question the well-established 12(b)(6) standard of review, which permits dismissal when a plaintiff "fail[s] to state a claim upon which relief can be granted." Fed.R.Civ.P. 12(b)(6). To survive a 12(b)(6) motion, a complaint must include enough facts for a claim to be "plausible on its face" and thereby "raise a right to relief above the speculative level." Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555, 570 (2007). In determining the plausibility of a claim, district courts are required to assume that all well-pled factual allegations are true "even if doubtful in fact, " id. at 555, and must also "draw all reasonable inferences in favor of the plaintiff, " Kensington Volunteer Fire Dep't v. Montgomery County, 684 F.3d 462, 467 (4th Cir. 2012) (internal quotation marks and citation omitted).

Although the Court must accept all well-pled factual allegations, a plaintiff's legal conclusions are not similarly accepted. Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (citing Twombly, 550 U.S. at 555). Additionally, while it is generally not appropriate to consider the viability of affirmative defenses at the 12(b)(6) stage, in "relatively rare circumstances" where all of the facts "necessary to the affirmative defense clearly appear on the face of the complaint, " an affirmative defense, including a defense seeking to demonstrate that a case is time-barred, may be resolved on a motion to dismiss. Goodman v. Praxair, Inc., 494 F.3d 458, 464 (4th Cir. 2007) (internal quotation marks and citation omitted).


1. Statute of Limitations - All Counts

It is undisputed that the five-year limitations period governing Virginia contract actions applies in this diversity action and is further undisputed that Plaintiff filed this case exactly five years from the date of the foreclosure sale of her home. American Inn, L.P. v. Wolf, 28 F.App'x 316, 319 (4th Cir. 2002) (quoting Va. Code Ann. § 8.01-246(2)). However, Defendant's 12(b)(6) motion argues that Plaintiff's own allegations demonstrate that Defendant committed contractual breaches months prior to the foreclosure sale, thus rendering all four counts of Plaintiff's civil complaint untimely. Cf. Va. Code § 8.01-230 (indicating that breach of contract claims accrue and the limitations period begins to run "when the breach of contract occurs in actions ex contractu and not when the resulting damage is discovered"). Plaintiff responds in opposition to dismissal by arguing that damage is an element of a breach of contract action and that the limitations period did not begin to run in this case until the foreclosure sale occurred because all claimed damages flow from that sale and/or events occurring after such sale.

Initially, the Court highlights its disagreement with Plaintiff's contention that no damages were suffered prior to the date of the foreclosure sale. As effectively argued in Defendant's reply brief, the stated purpose of the parties' forbearance agreement was to permit Plaintiff a defined period of time to resolve or improve her financial situation, during which Defendant promised to accept reduced payments. When Defendant refused Plaintiff's valid and timely payment under the forbearance agreement, "disregarded the Special Forbearance Agreement, " "resume[d] foreclosure proceedings" and "refused Plaintiff's subsequent payments . . . under the special forbearance agreement, " Plaintiff was surely damaged, at least to a degree, by such breaches. Compl. ¶¶ 17-19.

Notwithstanding the above, "Virginia recognizes that multiple breaches or occurrences can give rise to separate causes of action." Park v. Alcon Surgical, Inc., 991 F.2d 790, 1993 WL 114820, at *3 (4th Cir. 1993) (unpublished table opinion) (citation omitted). The Virginia Supreme Court has explained such concept as follows, "when wrongful acts are not continuous but occur only at intervals, each occurrence inflicts a new injury and gives rise to a new and separate cause of action." Hampton Roads Sanitation Dist. v. McDonnell, 234 Va. 235, 239 (1987). While the Hampton Roads Sanitation case dealt with trespass, "the same principle applies to contracts." Park, 1993 WL 114820, at *4 (citing Burns v. Board of Supervisors, 227 Va. 354, 357, 364 (1984)); cf. Am. Physical Therapy Ass'n v. Fed'n of State Boards of Physical ...

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