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Eggiman v. Ventures Trust 2013-I-H-R By MCM Capital Partners, LLC

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

December 14, 2017

CLAIR L. EGGIMAN, Plaintiff,


         THIS MATTER comes before the Court on Defendants BankUnited, N.A., and Trustee Service's Motions to Dismiss Plaintiff's Amended Complaint pursuant to Rule 12(b)(6) for failure to state a claim.

         This case concerns the assignment of a mortgage on Plaintiff Clair Eggiman's property located in Fairfax County, Virginia, and the subsequent foreclosure sale of the same property. Plaintiff borrowed $392, 000.00 in August 2005, pursuant to an Adjustable Rate Note and Deed of Trust with Defendant BankUnited. In December 2014, BankUnited assigned Plaintiff's mortgage to Defendant Ventures Trust 2013 I-H-R, which later sold the property at a foreclosure sale in January 2016 for $334, 000.00 to Defendant Servis One, Inc., d/b/a BSI Financial Services. Defendant Trustee Services was the appointed Substitute Trustee of the Plaintiff's Deed of Trust and was involved with the January 2016 foreclosure sale.

         A motion to dismiss tests the sufficiency of the complaint. See Republican Party of N.C. v. Martin, 980 F.2d 943, 952 (4th Cir. 1992). In a Rule 12(b)(6) motion to dismiss, the court must accept all well-pled facts as true and construe those facrs in the light most favorable to the plaintiff. Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). The complaint must provide a short and plain statement showing that the pleader is entitled to relief, Fed.R.Civ.P. 8(a)(2), and it must state a plausible claim for relief to survive a motion to dismiss, Iqbal, 556 U.S. at 679. The court does not accept as true any "unwarranted inferences, unreasonable conclusions, or arguments." E. Shore Markets, Inc. v. J.P. Associates Ltd., 213 F.3d 175, 180 (4th Cir. 2000). If the complaint does not state a plausible claim for relief, the court should dismiss the case. Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007).

         Plaintiff alleges five causes of action in his First Amended Complaint. The first cause of action is a breach of contract claim asserted only against BankUnited. The second cause of action alleges both a quiet title claim and a slander of title claim. The third cause of action alleges violations of "Federal and State Fair Debt Collection Acts." The fourth cause of action alleges violations of the Real Estate Settlement; Procedures Act ("RESPA"). Finally, the fifth cause of action alleges a claim of wrongful foreclosure.

         For the breach of contract claim, Plaintiff alleges that BankUnited did not provide notice for change of servicer, notice of acceleration, notice of default, or notice to reinstate the loan. Under the Deed of Trust, the Note and the Deed of Trust can be sold one or more times without prior notice to the borrower. Am. Compl., Ex. B, ¶20. Thus, an assignment of the Deed of Trust to Ventures Trust without prior notice was expressly permitted. Plaintiff also claims that he did not receive notice of the assignment or change in loan servicer. However, attached to the Amended Complaint is a letter dated December 11, 2014 from BSI to Plaintiff informing Plaintiff that Ventures Trust purchased the loan and BSI was the new servicer of the loan.

         Plaintiff further alleges that he did not receive a notice of acceleration. The Note provides that the Lender may require immediate payment in full of all sums secured by the Agreement. Plaintiff fails to allege that BankUnited required immediate payment of the Loan at any time thereby accelerating the payment. For the notice of default, and the notice of right to reinstate the loan, the Deed provides that the Plaintiff is required to give notice and opportunity to the Lender to cure any breach of the Deed of Trust prior to instituting legal action against the Lender. Am. Compl., Ex. B ¶20. Plaintiff fails to allege specific facts that he provided any notice or opportunity to cure to the Lender before initiating this action. Plaintiff has therefore not stated a plausible claim for breach of contract.

         For Plaintiff's quiet title claim, the Amended Complaint fails to state a plausible claim because Plaintiff does not allege that he had superior title through satisfaction of loan obligations. See Jones v. Fulton Bank, No. 3:13-cv-00126, 2013 WL 3788428, at *8 (E.D. Va. July 18, 2013) ("To assert a claim for quiet title, the plaintiff must plead that he has fully satisfied all legal obligations to the party in interest."}. Further, Defendant Trustee Services does not currently have a claim to the property nor has Plaintiff alleged that it does. For these reasons, Plaintiff has not stated a claim for quiet title upon which recovery may be had.

         With respect to the slander of title claim, Plaintiff does not allege a claim against Defendant BankUnited or Defendant Trustee Services. Plaintiff has therefore not pled sufficient factual allegations to support a claim for slander of title against either defendant.

         Plaintiff alleges that BankUnited and Trustee Services violated "Federal and State debt collection laws." The Amended Complaint first references provisions of the Virginia Consumer Protection Act, Va. Code Ann. § 59.1-197, et seg., and alleges that Defendant violated that act because they "failed and refused to give Plaintiff the required notices and failed to provide Plaintiff full and complete proof of the mortgage debt." However, that act expressly excludes banks, and thus does not apply to BankUnited. Id; § 59.1-199(D).

         In regards to Defendant Trustee Services, that act does not require that Defendant provide "complete proof of the mortgage debt, " but rather, that notice of the foreclosure sale is sent 14 days before the scheduled foreclosure sale. Id. § 59.1-199(A). Plaintiff acknowledges receiving notice of the foreclosure sale on January 19, 2016 for the January 27, 2016 foreclosure. Plaintiff does not allege any specific factual allegations as to which other provisions of the code Defendant Trustee Services may have violated.

         Plaintiff also alleges that BankUnited and Trustee Services violated the federal Fair Debt Collection Practices Act ("FDCPA"). 15 U.S.C. § 1692. The FDCPA applies only to "debt collectors, " a term of art defined by the FDCPA. 15 U.S.C. § 1692a(6). "It is well-established in this District that debt collectors do not include creditors, mortgagers, mortgage servicing companies, trustees exercising their fiduciary duties, or assignees of debt so long as the debt was not in default at the time it was assigned." Velez v. Bank of Hew York Mellon Trust Co. N.A., No. 1:12-CV-01008, 2012 WL 5305508, at *4 (E.D. Va. Oct. 23, 2012) (citing Ruggia v. Washington Mut., 719 F.Supp.2d 642, 648 (E.D. Va. 2010)).

         Plaintiff has not alleged, nor is it actually the case, that BankUnited qualifies as a debt collector. As Plaintiff noted in the Amended Complaint, BankUnited originated the loan. The term "debt collector" expressly excludes "any person collecting or attempting to collect any debt owed or due or asserted to be owed or due another to the extent that such activity ... concerns a debt which originated by such person...." 15 U.S.C. §1692a(6)(F)(ii).

         As it pertains to Trustee Services, 15 U.S.C. § 1692g requires certain disclosures to the debtor/borrower in the initial communication with the debtor/borrower, or within five days of the initial communication. Cnce that disclosure is made, the debtor/borrower has thirty days to dispute the debt or any portion thereof; otherwise the debt is statutorily considered to be valid.

         Plaintiff does not allege in the pleadings that he stated or gave proof of when he disputed the debt, what part of the debt was disputed, or when a ...

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