Vanderhoop v. Wilmington Savings Funds Society FSB

          MEMORANDUM AND ORDER ON DEFENDANT'S MOTION TO DISMISS

          F. Dennis Saylor IV United States District Judge.

         This is an action seeking to forestall a mortgage foreclosure. Plaintiff Matthew Vanderhoop, who has been in default on his mortgage for more than ten years, seeks to enjoin defendant Wilmington Savings Funds Society FSB from foreclosing on his property. Wilmington Savings has filed a motion to dismiss the complaint. For the reasons set forth below, the motion to dismiss will be granted in part and denied in part.

         I. Background

         A. Factual Background

         Unless otherwise noted, the facts are stated as alleged in the amended complaint.^[1]Matthew Vanderhoop has owned property in Aquinnah, Massachusetts, since approximately 1989. (Am. Compl. ¶ 8). On April 24, 2007, he entered into a $850, 000 mortgage loan agreement with Sovereign Bank to finance the building of a house at 17 Old South Road in Aquinnah. (Am. Compl. ¶ 12). The agreement required him to make monthly payments of $5, 090.72. (Am. Compl. ¶ 17).

         According to the complaint, in 2008, Vanderhoop's seasonal business began to suffer from reduced levels of tourism caused by the economic recession. He was unable to make his monthly mortgage payments. (Am. Compl. ¶ 19). He contends that he contacted the bank in an attempt to reduce the interest rate on his mortgage, but that the bank never responded. (Am. Compl. ¶ 21). According to the bank, he has not made a payment in more than ten years.

         On September 9, 2014, Sovereign Bank, which had by then changed its name to Santander Bank, assigned and transferred the mortgage to MTGLQ Investors. (Am. Compl. ¶ 26).^[2] On February 2, 2015, MTGLQ assigned the mortgage to Wilmington Savings. (Am. Compl. ¶ 32).^[3] Vanderhoop contends that he was not notified of either of those assignments. (Am. Compl. ¶ 27, 33).

         Vanderhoop also contends that both assignments were defective. The acknowledgment of the 2014 assignment, he contends, was defective because (1) it “was not dated by Kathryn Marvel, ” the notary public whose signature appears on the document, and (2) it did “not indicate that Carlie F. Speece was authorized to act in a representative capacity on behalf of Santander Bank.” (Am. Compl. ¶ 38, 40). The acknowledgment of the 2015 assignment, he contends, failed to “identify the company, MTGLQ.” (Am. Compl. ¶ 41).

         On February 4, 2016, Wilmington Savings filed an affidavit with the Dukes County Registry of Deeds executed by Angela Farmer, Vice President, Rushmore Loan Management Services, LLC, as the agent of Wilmington Savings. (Am. Compl. ¶ 44, Pl. Ex. 9). Among other things, the affidavit stated that Vanderhoop's mortgage “may” have been a “certain mortgage loan” as defined by Mass. Gen. Laws ch. 244, § 35B, and that Wilmington Savings had “satisfied . . . [t]he requirements of” § 35B by sending Vanderhoop “a notice of his [] rights to pursue a modified mortgage loan.” Vanderhoop contends, however, that he in fact was never “notif[ied] of his right to pursue a modified mortgage loan.” (Am. Compl. ¶ 34).

         Vanderhoop further contends that “[o]n February 14, 2018, at 8:59:14 AM, ” his “mortgage was assigned from [Wilmington Savings] to MTGLQ.” (Am. Compl. ¶ 48). He has submitted a copy of a document titled “Assignment of Mortgage” that appears to have assigned the mortgage from Wilmington Savings to MTGLQ. (Pl. Ex. 5). The document, however, is dated January 10, not February 14, 2018. (Pl. Ex. 5). “February 14, 2018, at 8:59:14 AM” appears instead to be the date and time when the assignment was filed with the Dukes County Registry of Deeds. (Pl. Ex. 5).

         Vanderhoop similarly contends that “[o]n February 14, 2018, at 8:59:14 AM, ” his “mortgage was assigned from MTGLQ to [Wilmington Savings].” (Am. Compl. ¶ 47). He has submitted a copy of a document titled “Assignment of Mortgage” that appears to have assigned the mortgage from MTGLQ to Wilmington Savings. (Pl. Ex. 6A). That document, however, is dated February 6, not February 14, 2018, and “February 14, 2018, at 8:59:14 AM” again appears to be the date and time when the assignment was filed with the Dukes County Registry of Deeds.

         Vanderhoop contends that the acknowledgments of both 2018 assignments, like the earlier acknowledgments, suffered from various defects. The acknowledgement of the first 2018 assignment, he alleges, did not state that Donna Bramer, the attorney-in-fact for Wilmington Savings, “signed the document in a representative capacity.” (Am. Compl. ¶ 49). The acknowledgment of the second 2018 assignment, he contends, was defective in three ways. First, it lacked a date of the notary's signature. (Am. Compl. ¶ 50). Second, it did “not indicate” how the notary public “identified the signatory.” (Am. Compl. ¶ 51). Third, it did not state that Dave Slear, MTGLQ's Vice President, signed the assignment “in a representative capacity [] as an act of [Wilmington Savings].” (Am. Compl. ¶ 52).

         Ultimately, Vanderhoop seeks to “prevent [Wilmington Savings] from foreclosing on [his] home.” The amended complaint, however, provides almost no information concerning a scheduled or threatened foreclosure. (Am. Compl. ¶ 1). Indeed, the complaint states only that “[o]n March 20, 2018, [Wilmington Savings] filed a [Servicemembers Civil Relief Act] Notice with the Massachusetts Land Court.” (Am. Compl. ¶ 53).^[4] None of the documents filed by Vanderhoop appear to provide any additional information concerning a threatened foreclosure.

         B. Procedural History

         On August 22, 2018, Vanderhoop filed a complaint in Dukes County Superior Court against Wilmington Savings. (Am. Compl. ¶ 2). The bank removed the action to this Court on September 11, 2018.

         On October 15, 2018, the bank filed a motion to dismiss the complaint. On October 17, 2018, the Court issued a preliminary injunction enjoining the bank from foreclosing on the property before November 13, 2018.

         On November 13, 2018, the Court denied the bank's motion to dismiss without prejudice. The Court also directed Vanderhoop to file an amended complaint by November 29, 2018, and extended the preliminary injunction through December 19, 2018.

         Vanderhoop filed an amended complaint on November 29. On December 11, the bank filed a motion to dismiss the amended complaint. The Court heard argument on December 19, 2018. Due to the impending holidays, the Court permitted supplemental briefing to be filed by January 3, 2019, and extended the preliminary injunction through January 4, 2019.^[5]

         II. Analysis

         The amended complaint asserts 15 counts. Each count lists multiple claims, many of which are repeated over the different counts.^[6] Defendant has moved to dismiss each count. For the following reasons, the motion to dismiss will be granted in part and denied in part.

         A. Count One

         Count One is entitled “Material Breach of Contract; Unlawful Methods and Practices; Unfair and Deceptive Practices; Violation of G.L. c. 244, §35A, §35B, and §35C, and Failure to Perform.” It alleges as follows:

Mr. Vanderhoop repeats and realleges the allegations in paragraphs 1 through 53 above. Mr. Vanderhoop's mortgage was a “certain mortgage [loan]” as defined by G.L.c. 244, §35B, and defendant did not conduct the required analysis to determine if Mr. Vanderhoop was capable of paying a modified mortgage loan and, defendant did not offer Mr. Vanderhoop any such identified loan.

Am. Compl. ¶ 54. Thus, despite its title, Count One alleges only a violation of Mass. Gen. Laws ch. 244, § 35B.

         1. The Requirements of Ch. 244, § 35B

         Mass. Gen. Laws ch. 244, § 35B provides, among other things, that a “creditor shall not cause publication of notice of a foreclosure sale” upon “certain mortgage loans” unless “it has first taken reasonable steps and made a good faith effort to avoid foreclosure.” Mass. Gen. Laws ch. 244, § 35B(b). The definition of “certain mortgage loans” has many parts; it is sufficient to note for present purposes that the parties appear to agree that the Vanderhoop loan is a “certain mortgage loan” within the meaning of the statute.

         The statute further provides that “[a] creditor shall have taken reasonable steps and made a good faith effort to avoid foreclosure if the creditor has considered: (i) an assessment of the borrower's ability to make an affordable monthly payment; (ii) the net present value of receiving payments under a modified mortgage loan as compared to the anticipated net recovery following foreclosure; and (iii) the interests of the creditor, including, but not limited to, investors.” Id. It goes on to state that “[a] creditor shall be presumed to have acted in good faith and to have complied with this subsection, if, prior to causing publication of notice of a foreclosure sale, . . . the creditor” determines “a borrower's ability to make an affordable monthly payment, ” conducts an analysis, and either agrees to a modified mortgage or notifies the borrower that “no modified mortgage loan will be offered.” Id. § (b)(2). It further provides that “the creditor shall send notice . . . of the borrower's rights to pursue a modified mortgage loan” and that the borrower must respond to the notice within 30 days. Id. § (c).

         2. Whether Defendant Complied with the Statutory Requirements

         Wilmington Savings contends that it complied with Mass. Gen. Laws ch. 244, § 35B, because it provided Vanderhoop with the required notice, thus giving him an opportunity to request a modified mortgage loan, and he never responded to that offer. The bank further contends that it recorded an affidavit in the registry of deeds that states it complied with the statute, and that ...