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Yancey v. First Bank & Trust Co.

United States District Court, W.D. Virginia, Lynchburg Division

August 2, 2016

Jay T. Yancey and Melinda O. Yancey, Plaintiffs,
The First Bank and Trust Company, Defendant



         Judge Norman K. Moon

         This matter is before the Court upon Defendant’s motion to dismiss. Dkt. 10. Plaintiffs Jay T. Yancey and Melinda O. Yancey (“Plaintiffs” or “Yanceys”) filed this action against The First Bank and Trust Company (“Defendant” or “First Bank”) for allegedly violating numerous state and federal laws.[1] Because the Yanceys’ complaint is built upon conclusory allegations and does not plead sufficient facts to maintain any of the alleged claims, I will grant Defendant’s motion.


         Plaintiffs allege the following facts: In August 2012, Melinda Yancey contacted Carey Wrenn (“Wrenn”), a lending officer at First Bank, seeking a loan for the construction of a home. Compl. ¶¶ 10–13. Wrenn requested that the Yanceys provide him with their tax returns. Id. On September 11, 2012, Mrs. Yancey met once again with Wrenn to discuss the Yanceys’ credit scores and financial status. Id. at ¶ 19. On September 20, 2012, Wrenn completed an initial credit memo stating that he was inclined to consider a loan request of $180,000. Id. at ¶21; see also dkt. 2-1 at 24–26. On the same day, Mrs. Yancey provided Wrenn a personal financial statement. Id.; see also dkt. 2-1 at 20–23.

         After this initial credit memo and personal financial statement, Wrenn failed to immediately provide the loan documentation. Id. at ¶ 23. The lack of promptness frustrated the Yanceys who began to constantly contact Wrenn about their loan status. Id. at ¶ 22–42. On December 3, 2012, Wrenn emailed the Yanceys stating that “I am leaning toward financing the project.” Id. at ¶ 35. On December 21, 2012, Wrenn emailed again stating that: “While I know you are eager to get this done and are concerned about the weather, I have not told you to move forward with construction and I have not agreed to a funding date. I know this has drawn out longer than you expected and longer than I desired.” Id. at ¶ 43. Plaintiffs continued to inquire with Wrenn about their loan status. Ultimately, Wrenn became frustrated by these inquiries and hostile toward the Plaintiffs. Id. at ¶ 46.

         On January 11, 2013, First Bank and the Yanceys met to close the loan and set up a construction bank account. Id. at ¶ 55. On that same day, First Bank deposited the first draw of $33,000 into the construction bank account. Id. at ¶¶ 52, 59. On February 4, 2013, First Bank deposited the second draw of $20,000 based on the status of the home construction. Id. at ¶ 63.

         In April 2013, First Bank increased the loan amount to $220,000 and agreed to renew the maturity date. Id. at ¶69. First Bank also agreed to provide an additional $7,000 loan to the Yanceys’ company, New Life Construction of VA, Inc. Dkt. 2-1 at ¶¶ 73–74. In April 2014, First Bank agreed, once again, to a loan increase of an additional $33,000-the estimated cost to complete the home construction. Compl. ¶ 76.

         Subsequently, the Yanceys defaulted on their loans and First Bank initiated foreclosure proceedings on the property. The foreclosure sale was set for July 24, 2015; however, the Yanceys filed for a Chapter 13 bankruptcy petition on July 20, 2015. On June 23, 2016, based on default, the United States Bankruptcy Court dismissed the Plaintiffs’ bankruptcy petition.


         When evaluating a Rule 12(b)(6) motion to dismiss for failure to state a claim, the Court must accept as true all well-pleaded allegations. See Vitol, S.A. v. Primerose Shipping Co., 708 F.3d 527, 539 (4th Cir. 2013); see also Erickson v. Pardus, 551 U.S. 89, 94 (2007). “While a complaint attacked by a Rule 12(b)(6) motion to dismiss does not need detailed factual allegations, a plaintiff’s obligation to provide the grounds of his entitlement to relief requires more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007) (quotation marks omitted). Stated differently, in order to survive a motion to dismiss, “a complaint must contain sufficient factual matter, accepted as true, to ‘state a claim to relief that is plausible on its face.’” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Twombly, 550 U.S. at 570).


         A. Virginia Tort Claims

         a. Negligence and Negligent Misrepresentation

         The Yanceys allege negligence in Counts I (Negligence) and II (Negligent Misrepresentation). Under Virginia law, allegations of negligent performance of contractual duties are not actionable in tort. Dunn Constr. Co. v. Cloney, 278 Va. 260, 267 (Va. 2009) (“To avoid turning every breach of contract into a tort, however, we have consistently adhered to the rule that, in order to recover in tort, the duty tortuously or negligently breached must be a common law duty, not one existing between the parties solely by virtue of the contract.”) (citation omitted). Therefore, the Plaintiffs must show that the duty breached was a common law duty arising separately from the contractual duty. Id.; see also Richmond Metro. Auth. v. McDevitt Street Bovis, Inc., 256 Va. 553, 559 (Va. 1998) (“A tort action cannot be based solely on a negligent breach of contract.”).

         Here, the Plaintiffs’ negligence claims arise solely out of the loan agreements between them and First Bank, and their complaint lacks any factual ...

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