Opinion
No. 1:00CV37-D-D
May 23, 2000
OPINION
Presently before the court is the Defendant Deposit Guaranty National Bank's (DGNB) motion to dismiss pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure. Also before the court is the Plaintiff's request, contained in her response to DGNB's motion to dismiss, for leave of court to amend the pleadings. Upon due consideration, the court finds that both the Defendant's motion and the Plaintiff's request should be granted. As such, the Plaintiff is given until June 22, 2000, to file an amended complaint.
Deposit Guaranty National Bank is represented in this suit by AmSouth Bank, the successor in interest to First American National Bank d/b/a Deposit Guaranty National Bank.
Factual and Procedural Background
This action was brought by Stephanie Wallace, individually and as administratrix of the estate of Peggy Byrd, alleging a wrongful denial of life insurance benefits.
Byrd obtained a $25,000.00 home improvement loan from DGNB in March of 1996. As security for the loan, Byrd executed a deed of trust on her home in DGNB's favor. During the loan process, DGNB sold Byrd a credit life insurance policy issued by Defendant Fidelity Service Life Insurance Corporation (Fidelity) that would pay off the loan in the event of Byrd's death. The insurance premium of $5,250.00 was financed as part of the loan. DGNB was listed as the sole beneficiary of the life insurance proceeds.
On June 11, 1997, Byrd died as a result of hemorrhaging from an aneurysm. The Plaintiff, who is Byrd's daughter and the administratrix of her estate, made a claim on the life insurance policy for the payment of the DGNB loan. Fidelity denied this claim based on an alleged misrepresentation by Byrd during the life insurance application process. Despite this development, the Plaintiff has continued to make payments on the loan to DGNB.
On April 27, 1999, the Plaintiff filed a complaint in state court against DGNB, Ian Coxworth d/b/a Coxworth and Associates, Inc. (Coxworth) and Fidelity, asserting a wrongful denial of insurance benefits. The action was subsequently removed to the United States District Court for the Southern District of Mississippi based on diversity jurisdiction. The Defendants then moved successfully to transfer the case to this court.
DGNB has now filed the present motion to dismiss, asserting that the Plaintiff failed to state a claim against DGNB for which relief can be granted. In her response to DGNB's motion to dismiss, the Plaintiff requested leave of court in order to amend the pleadings.
12(b)(6) Standard
In ruling on a motion to dismiss under Rule 12(b)(6), the court must take as true the well pleaded allegations in the complaint and construe them in the light most favorable to the plaintiff. C.C. Port, Ltd. v. Davis Penn Mtg. Co., 61 F.3d 288, 289 (5th Cir. 1995). Taking the allegations as true, the court should dismiss the complaint only when it appears certain that the plaintiff cannot prove any set of facts that would entitle her to the relief requested. Id. Dismissal is never warranted because the court believes the plaintiff is unlikely to prevail on the merits. Scheuer v. Rhodes, 416 U.S. 232, 236, 94 S.Ct. 1683, 1686, 40 L.Ed.2d 90 (1974).
Discussion
The Plaintiff does not seriously contest that she failed to state a claim against DGNB in her present complaint. Instead, she asserts that the court should deny the Defendant's motion because DGNB is a party needed for just adjudication pursuant to Rule 19 of the Federal Rules of Civil Procedure. Alternatively, the Plaintiff seeks leave of court to amend her complaint in order to properly state a claim against DGNB seeking, inter alia, reimbursement from DGNB for the payments she made on the loan.
The Plaintiff's first ground is insufficient to withstand DGNB's motion. The Plaintiff asserts that DGNB qualifies as a necessary or indispensable party subject to Rule 19 joinder. The Plaintiff further asserts that she named DGNB in order to prevent DGNB's co-defendants from having this matter dismissed pursuant to a Rule 12(b)(7) motion for the failure to join an indispensable party.
The Plaintiff's attempt to stave off a Rule 12(b)(7) motion is misplaced. In order to avoid dismissal pursuant to Rule 12(b)(6), the Plaintiff must have stated a claim against DGNB upon which relief can be granted. The Plaintiff's current complaint fails to do so. For this reason, DGNB's motion to dismiss shall be granted.
The Plaintiff, however, shall be granted leave of court in order to amend her complaint. Pursuant to Rule 15(a) of the Federal Rules of Civil Procedure, after service of a responsive pleading, a party may amend her complaint "only by leave of court or by written consent of the adverse party; and leave shall be freely given when justice so requires." Fed.R.Civ.P. 15(a). While the Plaintiff did not file a separate formal motion requesting leave to amend, a formal motion is not always required, so long as the requesting party has set forth with particularity the grounds for the amendment and the relief sought. Fed.R.Civ.P. 7(b)(1), 15(a); Edwards v. Occidental Chemical Corp., 892 F.2d 1442, 1445-46 (9th Cir. 1990). Here, the Plaintiff has done so, stating numerous times in her response that she "intends to amend her [c]omplaint to seek recovery from DGNB . . ." and that she will "seek to amend her [c]omplaint to secure reimbursement from DGNB . . ." Finally, the Plaintiff ends her response by stating that she "respectfully requests that [the present motion to dismiss be held in abeyance until] amendments to the [p]leadings have been completed." While the court declines to hold DGNB's motion to dismiss in abeyance, in light of the Plaintiff's request for leave to amend and due to the fact that the grounds for amendment are set forth with particularity, the court will not require a formal separate motion requesting leave of court to amend. Cf. Confederate Mem'l Ass'n, Inc.v. Hines, 995 F.2d 295, 299 (D.C. Cir. 1993) ("[A] bare request in an opposition to a motion to dismiss — without any indication of the particular grounds on which the amendment is sought — does not constitute [a request for leave to amend].").
In addition, whether a party should be granted leave to amend is within the district judge's discretion. Foman v. Davis, 371 U.S. 178, 182, 83 S.Ct. 227, 230, 9 L.Ed.2d 222 (1962); Halbert v. City of Sherman, 33 F.3d 526, 529 (5th Cir. 1994). In exercising its discretion, a district court may consider such factors as undue delay, bad faith or dilatory motive on the part of the movant, repeated failure to cure deficiencies by amendments previously allowed, undue prejudice to the opposing party, and futility of the amendment. Foman, 371 U.S. at 182; Southmark Corp. v. Schulte Roth Zabel, 88 F.3d 311, 314-15 (5th Cir. 1996).
The Defendant argues that allowing the Plaintiff to amend would be futile. At this juncture, the court cannot agree. Additionally, the remaining factors weigh in favor of granting the Plaintiff leave to amend.
In sum, the court finds that the Defendant's motion to dismiss shall be granted. Additionally, the Plaintiff shall be granted leave of court in order to amend her complaint. As such, DGNB shall be dismissed from this action due to the Plaintiff's failure to state a claim against it in her original complaint. Upon proper amendment, DGNB shall again be a party to this action. Should the Plaintiff, however, fail to amend by June 22, 2000, DGNB will remain dismissed from this action. A separate order in accordance with this opinion shall issue this day.
ORDER
Pursuant to an opinion issued this day, it is hereby ORDERED that
the Defendant's motion to dismiss pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure (docket entry 28) is GRANTED;
(2) the Plaintiff's request for leave of court in order to amend the complaint is GRANTED; and
(3) the Plaintiff has until June 22, 2000, to amend the complaint.