Opinion
C.A. 6:22-cv-00261-HMH-KFM
08-23-2022
Paul Wright, Plaintiff, v. Wells Fargo Bank NA, Secretary of Veterans Affairs, Secretary of Education, Defendants.
REPORT OF MAGISTRATE JUDGE
Kevin F. McDonald United States Magistrate Judge
This is a civil action filed by a pro se and in forma pauperis non-prisoner plaintiff. Pursuant to the provisions of 28 U.S.C. § 636(b) and Local Civil Rule 73.02(B)(2) (D.S.C.), this magistrate judge is authorized to review all pretrial matters in this case and submit findings and recommendations to the district court.
The plaintiff's complaint was entered on the docket on January 27, 2022 (doc. 1). By orders filed February 1,2022, and March 1, 2022, the plaintiff was given a specific time frame in which to bring his case into proper form for judicial screening (docs. 9; 17). The plaintiff complied with the court's orders, and the case is now in proper form for judicial screening. However, upon review of the plaintiff's complaint, the undersigned recommends it be dismissed.
LITIGATION HISTORY & ALLEGATIONS
The plaintiff, dissatisfied with foreclosure proceedings, filed this action seeking damages and a declaratory judgment against the defendants (doc. 1). The plaintiff alleges federal question jurisdiction because he sues officers of the United States (id.). The court takes judicial notice of the foreclosure proceeding in Greenville County (‘the Foreclosure Action”). Greenville County Public Index, https://publicindex.sccourts.org/ Greenville/PublicIndex/PISearch.aspx (enter the plaintiff's name and 2012CP2305587) (last visited April 4, 2022).
Phillips v. Pitt Cnty. Mem. Hosp., 572 F.3d 176, 180 (4th Cir. 2009) (courts “may properly take judicial notice of matters of public record.”); Colonial Penn Ins. Co. v. Coil, 887 F.2d 1236, 1239 (4th Cir. 1989) (“We note that ‘[t]he most frequent use of judicial notice . . . is in noticing the content of court records.'”).
The Foreclosure Proceedings
The foreclosure action was filed by Wells Fargo Bank, NA (“Wells Fargo”) on August 28, 2012. Id. (Complaint filed August 28, 2012). On September 24, 2012, the plaintiff filed an answer, counterclaim, and motion to dismiss in the Foreclosure Action. Id. (Answer/Counterclaim and Motion to Dismiss filed September 24, 2012). The plaintiff's wife, Jill G. Wright, filed an answer adopting the plaintiff's defenses and counterclaims, on April 2, 2013. Id. (Answer of Mrs. Wright filed on April 2, 2013). As part of the Foreclosure Action, the parties underwent mediation, during which the plaintiff (and his wife) agreed to dismiss, with prejudice, “affirmative defenses and counterclaims pled in the [Foreclosure Action].” Id. (Stipulation of Dismissal filed July 13, 2015). The agreement included the following stipulations, verbatim:
1. This is a residential foreclosure action related to certain real property in Greenville, SC (the “Property”) and a loan from Wells Fargo Bank, N.A. (“Plaintiff”) used to purchase the same (the “Loan”).
2. Prior to this action being filed, Defendant Paul T. Wright (“Wright”) extended multiple offers to cooperate with Plaintiff regarding the Loan, beginning with a letter dated April 5, 2012, whereby Wright notified the United States Department of Veteran's Affairs (the “VA”) and Plaintiff that he was not able to make his mortgage payments for an indefinite period of time. Wright accordingly requested that Plaintiff grant forbearance and modification of the Loan. Wright repeated the same requests in letters dated May 28, 2012, June 1, 2012 and July 6, 2012.
3. By letter dated May 30, 2012, Plaintiff sent Wright an application for a mortgage-assistance program. Wright responded to Plaintiff that the information needed to respond
to his request for forbearance and loan modification was contained in the 2011 application for the Loan, and that his response on the mortgage-assistance program application was “NA” pursuant to Plaintiff's written instructions to mark any inapplicable sections in that manner. Wright further offered to provide additional information beyond the 2011 application, should Plaintiff identify any specific information needed to respond to Wright's request.
4. In or around August 2012, the present action was filed.
5. In his pleadings and filings before this Court, Wright alleges that Plaintiff has improperly proceeded with this foreclosure action and unnecessarily caused him substantial damages, personally and professionally, instead of pursuing workout options.
6. Plaintiff disputes these allegations.
7. Plaintiff and Defendants have since mutually agreed to resolve their disputes in this action and to file this Stipulation of Dismissal by Defendants.Id. (Stipulation of Dismissal filed July 13, 2015). The plaintiff and Mrs. Wright signed the stipulation. Id. (Stipulation of Dismissal filed July 13, 2015). On December 10, 2015, Mrs. Wright filed a motion for injunctive relief in the Foreclosure Action, asserting that Wells Fargo was illegally allowing collection of a parent loan taken out only in her name (the “Parent Loan”). Id. (Motion for Injunctive Relief filed December 10, 2015). The Foreclosure Action was referred to the Master in Equity by order entered January 7, 2016. Id. (Order filed January 7, 2016). The plaintiff then filed a motion to “remove cloud on title, and for damages” on February 8, 2016, arguing that Wells Fargo had no jurisdiction to pursue judicial foreclosure in the Foreclosure Action. Id. (Motion to Remove Clouds on Title filed February 8, 2016). On February 25, 2016, a hearing was held before the Honorable Charles B. Simmons, Jr., Master in Equity. Id. (transcript filed on March 16, 2016). During the hearing, Judge Simmons noted that because Mrs. Wright was not present to argue her motion seeking injunctive relief regarding the Parent Loan, he considered it abandoned and denied her motion. Id. (transcript pp. 3-6). In ruling, Judge Simmons noted that the plaintiff could not represent Mrs. Wright's interest despite an indemnification agreement, unless he was a licensed attorney representing her. Id. (transcript p. 5). The plaintiff then detailed his defenses to the Foreclosure Action, including his arguments that the court did not have jurisdiction to grant a foreclosure in the Foreclosure Action. Id. (transcript pp. 6-23). The plaintiff's arguments included that (1) at the advice of the Department of Veterans Affairs (“VA”), he sought alternatives to disclosure but the defendant would not respond; (2) he would not have purchased the home without the VA guaranty; (3) the Foreclosure Action complaint did not state a claim under South Carolina Code §§ 29-3-630, 29-3-650 (by not following the exact statutory language in the complaint and requested relief); and (4) the Foreclosure Action violated the Administrative Order issued by the South Carolina Supreme Court regarding the disposition of foreclosure actions. Id. (transcript pp. 6-23). Judge Simmons denied the plaintiff's request/petition and issued an Order and Judgment of Foreclosure and Sale on March 14, 2016. Id. (Foreclosure Order 1 filed March 16, 2016). During this same time, the plaintiff filed a motion to alter or amend judgment. Id. (Motion to alter or amend judgment filed March 7, 2016). Judge Simmons had a hearing on the plaintiff's motion on April 12, 2016. Id. (transcript filed on May 4, 2016). During the hearing, the plaintiff again argued that the court lacked subject matter jurisdiction in the Foreclosure Action. Id. (transcript pp. 2-8). The plaintiff noted that the two breached settlement agreements supported his argument that Wells Fargo was required to exhaust alternatives before filing of the Foreclosure Action. Id. (transcript pp. 2-3). The plaintiff also noted that he had contacted the VA and the VA had reported that Wells Fargo had not completed their obligations under the VA guaranty to proceed with the Foreclosure Action, which violated the plaintiff's due process rights. Id. (transcript pp. 5-6, 13). The plaintiff's motion was denied by order issued May 6, 2016. Id. (Order filed May 6, 2016). The plaintiff filed a notice of appeal, but later withdrew his appeal. Wells Fargo v. Wright, et al., C/A No. 2016000954 (S.C. Ct. App. June 29, 2016).
The Parent Loan was a student loan taken out by Mrs. Wright from the Department of Education. Greenville County Public Index (enter the plaintiff's name and 2012CP2305587) (last visited April 4, 2022) (Motion for Injunctive Relief filed December 10, 2015).
A third hearing in the Foreclosure Action took place on September 15, 2016. Greenville County Public Index (enter the plaintiff's name and 2012CP2305587) (last visited April 4, 2022) (transcript filed September 26, 2016). During the hearing, in response to testimony by Wells Fargo about the amount due on the note, the plaintiff argued that “there are two settlement agreements wherein [Wells Fargo] released that claim.” Id. (transcript p. 3). Wells Fargo then argued that there was a settlement agreement that the plaintiff had not complied with, which is why Wells Fargo was going forward with the Foreclosure Action. Id. (transcript p. 3). The plaintiff argued that both settlement agreements had been breached by Wells Fargo and that he had completed his obligations under the agreements and testified that “I simply have a breach of contract claim when those damages are perfected and finalized.” Id. (transcript pp. 3-7). Following the hearing, a supplemental foreclosure order was issued by Judge Simmons on September 16, 2016. Id. (Foreclosure Order 2 filed on September 16, 2016). On October 26, 2016, Wells Fargo filed a status report with the court, asserting that the parties would be trying loss mitigation prior to continuation of the Foreclosure Action. Id. (Status Report filed October 26, 2016). The plaintiff responded on November 1, 2016, asserting that delay for loss mitigation was inappropriate and the matter should instead be dismissed with prejudice and indicated that he would be seeking to enforce the prior settlement agreement between the plaintiff and Wells Fargo. Id. (Status Report filed November 1, 2016). Wells Fargo then responded to the plaintiff's status report, requesting that “a foreclosure sale be scheduled in the future.” Id. (Return to Status Report filed November 14, 2016). The plaintiff then filed a supplemental status report, seeking to have the settlement agreement enforced and the foreclosure sale cancelled. Id. (Supplemental Status Report filed November 16, 2016).
On February 24, 2017, the plaintiff submitted a letter to Judge Simmons, requesting that counsel for Wells Fargo in that action be admonished for his lack of candor with the court. Id. (Letter filed February 24, 2017). The plaintiff's letter further noted that Wells Fargo was attempting to bypass the settlement agreement in seeking to hold the foreclosure sale. Id. (Letter filed February 24, 2017). The plaintiff filed another letter with Judge Simmons on March 7, 2017, seeking rescission of a settlement agreement despite non-refund of funds he received in consideration of the agreement. Id. (Letter filed March 7, 2017). That same day, a second supplemental foreclosure order was issued by Judge Simmons. Id. (Foreclosure Order 3 filed March 7, 2017). Wells Fargo responded to a purported proof of payment submitted by the plaintiff, noting that the plaintiff had not redeemed the foreclosed mortgage and requesting that the property proceed to public auction. Id. (Wells Fargo Response filed April 27, 2017). On June 1, 2017, Judge Simmons issued an order recognizing the foreclosure sale of the premises in question. Id. (Order filed June 1, 2017).
The Federal Action
Four and a half years after the sale of the subject property, the plaintiff filed the instant action asserting violations of his rights by the defendants (doc. 1). The plaintiff alleges that when he defaulted on his mortgage, his wife was in default on the Parent Loan he alleges was issued by Wells Fargo (Id. at 2). He contends that he has an indemnity agreement with his wife for the Parent Loan, which is why he is able to bring the claim on her behalf (Id.). The plaintiff alleges that, with respect to the foreclosure, he offered a deed in lieu of foreclosure to Wells Fargo, but Wells Fargo still filed the foreclosure action (Id.). The plaintiff contends that he showed (presumably in the foreclosure action) that Wells Fargo had filed the action in violation of an Administrative Order issued by the South Carolina Courts as well as that Wells Fargo had committed multiple torts in attempting to collect on the mortgage (Id.). He alleges that based upon these violations, Wells Fargo and the plaintiff entered into a settlement agreement agreeing that the plaintiff would tender a deed in lieu of foreclosure and the plaintiff would dismiss any of his claims (Id.). After executing the settlement agreement the plaintiff alleges a deed was provided to Wells Fargo, but Wells Fargo refused to comply with the terms of the settlement that had been agreed to (Id. at 2-3).
After breaching the first settlement agreement, and after participating in mediation, Wells Fargo and the plaintiff entered in a second settlement agreement (Id. at 3). The plaintiff then dismissed his affirmative defenses and counterclaims and consented to the foreclosure (Id.). Wells Fargo waived any deficiency and purchased the plaintiff's house at foreclosure (Id.). The VA then paid a claim to Wells Fargo as guaranty on the loan (Id.). Because the plaintiff had a house foreclosed upon that had a VA guaranty, the plaintiff is no longer eligible for a VA mortgage loan (Id.). The plaintiff further contends that the secretary of education paid a claim to Wells Fargo for the Parent Loan in his wife's name (Id.). Although the Secretary of Education stopped collecting on the parent loan from Mrs. Wright in 2018, the plaintiff alleges that the collection of the loan will begin February 1, 2022 (Id. at 4).
The plaintiff seeks a declaratory judgment that the foreclosure settlement satisfied the mortgage loan, meaning Wells Fargo was not entitled to collect on the federal guaranty from the VA; that the VA is a successor in interest to Wells Fargo and is bound by Wells Fargo's release of claims; that Wells Fargo also released its claims relating to the Parent Loan and had no right to collect on the federal guaranty; and that the Secretary of Education is a successor in interest to Wells Fargo and bound by Wells Fargo's release of claims (Id. at 4-5). The plaintiff further seeks an injunction and temporary restraining order requiring Wells Fargo to remove its claims asserted under the federal guaranty of the mortgage and parent loan; requiring the Secretary of Education to stop collection on the parent loan and refund any money collected; requiring the VA to restore the plaintiff's eligibility for a VA home loan (Id. at 5).
STANDARD OF REVIEW
The plaintiff filed this action pursuant to 28 U.S.C. § 1915, the in forma pauperis statute. This statute authorizes the District Court to dismiss a case if it is satisfied that the action “fails to state a claim on which relief may be granted,” is “frivolous or malicious,” or “seeks monetary relief against a defendant who is immune from such relief.” 28 U.S.C. § 1915(e)(2)(B). As a pro se litigant, the plaintiff's pleadings are accorded liberal construction and held to a less stringent standard than formal pleadings drafted by attorneys. See Erickson v. Pardus, 551 U.S. 89 (2007) (per curiam). The requirement of liberal construction does not mean that the Court can ignore a clear failure in the pleading to allege facts which set forth a claim cognizable in a federal district court. See Weller v. Dep't of Soc. Servs., 901 F.2d 387, 391 (4th Cir. 1990).
DISCUSSION
The plaintiff asserts that this court has jurisdiction over this action based upon Federal Question jurisdiction (doc. 1). As set forth in more detail below, this matter is barred by claim preclusion (res judicata) and fails to state a claim for relief; thus, the undersigned recommends that it be dismissed.
The plaintiff's complaint is barred by claim preclusion ( res judicata )
In the instant matter, the plaintiff seeks to re-litigate claims that have already been adjudicated and decided adversely to him in the Foreclosure Action. Under the doctrine of claim preclusion-or res judicata-a final judgment on the merits of an action bars the parties from re-litigating the issues that were or could have been raised in the prior action. See Pueschel v. United States, 369 F.3d 345, 354 (4th Cir. 2004). In order for res judicata to apply, there must have been (1) a final judgment on the merits in a prior suit; (2) the identity of the cause of action in both suits; and (3) the same parties or their privies in the two suits. Id. at 354-55 (citing Nash Cnty. Bd. of Educ. v. Biltmore Co., 640 F.2d 484, 486 (4th Cir. 1981)); see Orca Yachts L.L.C. v. Mollicam, Inc., 287 F.3d 316, 318 (4th Cir. 2002) (noting that claim preclusion applies when there has been a valid and final judgment-even if the matter was not actually litigated (quoting In re Varat Enters., Inc., 81 F.3d 1310, 1315 (4th Cir. 1996)). In evaluating whether the same cause of action is brought in both suits, the court ascertains whether the claim in the new litigation “arises out of the same transaction or series of transactions as the claim resolved by the prior judgment.” Pittston Co. v. United States, 199 F.3d 694, 704 (4th Cir. 1999) (internal quotation marks omitted) (quoting Harnett v. Billman, 800 F.2d 1308, 1313 (4th Cir. 1986)). Here, the plaintiff's claims that Wells Fargo breached the settlement agreement, filed the foreclosure action in violation of the Administrative Order entered by the South Carolina Supreme Court, breached a second settlement agreement, wrongfully asserted a claim under the VA guaranty of his loan, and that the settlement agreement with the defendant waived collection on the Parent Loan, were all addressed by the state court, as outlined in more detail above. See supra pp. 2-6; See also Greenville County Public Index (enter the plaintiff's name and 2012CP2305587) (last visited April 4, 2022). Indeed, even though the plaintiff has named additional parties in this action, as outlined, supra, all of the claims asserted in the instant matter were adjudicated on the merits adversely to the plaintiff and Mrs. Wright in the Foreclosure Action. See supra pp. 2-6; See also Greenville County Public Index (enter the plaintiff's name and 2012CP2305587) (last visited April 4, 2022). Accordingly, the plaintiff's claims against the defendants - encompassing the same allegations as asserted (on multiple occasions) in the Foreclosure Action - are barred by res judicata.
The Complaint is Subject to Summary Dismissal
Even if the instant action were not barred by res judicata, the plaintiff's claims would still be subject to summary dismissal, as outlined in more detail below.
Statute of Limitations
The plaintiff's breach of settlement agreement claims are barred by the statute of limitations. Although the plaintiff asserts subject matter jurisdiction because he seeks relief from “officers of the United States” “for [the plaintiff's] individual benefit and for the benefit of the United States” (doc. 1 at 1), his claim for breach of settlement agreement against Wells Fargo can be heard in this matter based upon diversity jurisdiction, meaning that South Carolina state law applies to this claim. See 28 U.S.C. § 1332(a) (noting that diversity jurisdiction is conferred upon the Court when a suit is between citizens of different states and the amount in controversy exceeds $75,000.00. 28 U.S.C. § 1332(a)). Here, assuming, arguendo, that the amount in controversy has been met, there is diversity between the plaintiff and Wells Fargo are citizens of different states for jurisdiction purposes. The plaintiff is a citizen and resident of South Carolina because an individual is a citizen of the state in which he or she is domiciled. Johnson v. Advance Am., 549 F.3d 932, 937 n.2 (4th Cir. 2008). Wells Fargo, a national banking association, is a citizen of South Dakota, where its main office is located. Jarvis v. Wells Fargo Bank, N.A., C/A No. DLB-21-687, 2021 WL 4214836, at *2 (D. Md. Sept. 16, 2021) (collecting cases recognizing that Wells Fargo is a citizen of South Dakota for diversity jurisdiction purposes). As such, the plaintiff's breach of settlement claim against Wells Fargo is governed by South Carolina law. See Gasperini v. Ctr. for Humanities, Inc., 518 U.S. 415, 426-27 (1996) (recognizing that a federal court exercising diversity jurisdiction applies state substantive law). In South Carolina, breach of contract claims - such as the plaintiff's - have a statute of limitations of three years. See S.C. Code § 15-3-530(1). Because South Carolina law applies to this claim, the discovery rule determines the date of accrual of the plaintiff's claims as the “statute of limitations begins to run when a cause of action reasonably ought to have been discovered” or “when the facts and circumstances of the injury would put a person of common knowledge on notice that some right has been invaded or the claim against another party exists.” Benton v. Roger C. Peace Hosp., 443 S.E.2d 537, 539 (S.C. 1994). Here, the plaintiff's testimony in front of Judge Simmons makes clear that at least by September 15, 2016, the plaintiff was aware of a claim for breach of contract, testifying that “I simply have a breach of contract claim when those damages are perfected and finalized.” See supra pp. 4, 5; Greenville County Public Index (enter the plaintiff's name and 2012CP2305587) (last visited April 4, 2022) (transcript filed September 26, 2016 pp. 3-7). Even presuming the plaintiff's claim did not accrue until the foreclosure finalized, as he asserted before Judge Simmons, the foreclosure was finalized by public sale of the subject property in June 2017. Id. (Order filed June 1, 2017). The instant matter was filed on January 27, 2022 (doc. 1). As such, the plaintiff's breach of settlement agreement claims are barred by the statute of limitations because, even presuming the discovery date in the plaintiff's favor, more than four years have elapsed since the plaintiff was aware of his breach of settlement agreement claim. Additionally, the plaintiff's assertion that he became aware of a guaranty paid by the VA to Wells Fargo in October 2021, does not affect that the statute of limitations has run on his breach of settlement agreement claims against Wells Fargo; thus, in addition to res judicata, the claims should be dismissed based upon the statute of limitations.
Of note, the plaintiff's claims involving the Secretary of Veterans Affairs and the Secretary of Education appear to be based upon federal question - not diversity jurisdiction.
Here, the statute of limitations in Section 15-3-520 does not apply to the plaintiff's claims because the settlement agreement was not “secured by a mortgage of real property.” S.C. Code. § 15-3-520(a).
VA Guaranty
The plaintiff also contends that Wells Fargo and the Secretary of the VA violated his rights when the VA paid a federal guaranty claim made by Wells Fargo after the Foreclosure Action (doc. 1 at 2-4). The VA home loan guaranty program provides for partial guaranties on home loans for veterans. 38 U.S.C. §§ 3701, et. seq. The guaranty “operate[s] as the substantial equivalent of a down payment in the same amount by the veteran on the purchase price, in order to induce prospective mortgagee-creditors to provide 100% financing for a veteran's home. United States v. Shimer, 367 U.S. 374, 383 (1961). Here, the plaintiff's VA guaranty claim appears three-fold: (1) that Wells Fargo wrongfully pursued the VA guaranty after waiving a deficiency judgment, (2) that the VA should not have paid the guaranty to Wells Fargo, and (3) that the VA should not deny the plaintiff's request to obtain an additional mortgage backed by a VA guaranty (see generally doc. 1).
The plaintiff's claims regarding the VA guaranty against Wells Fargo fail, however, because there is no private right of action for borrows to sue lenders regarding violations of VA regulations. For example, although not directly addressed by the Fourth Circuit, the Eleventh Circuit (referencing with approval a Ninth Circuit Case) recognized that “neither the statutory language nor the legislative history of the VA Act provides any indication of legislative intent” to create a private remedy against a lender. See Bright v. Nimmo, 756 F.2d 1513, 1516 (11th Cir. 1985); Ranson v. Bank of Am. N.A., C/A No. 3:125616, 2013 WL 1077093, at *4 n.2 (S.D. W.Va. Mar. 14, 2013) (collecting cases where a plaintiff's attempt to assert a cause of action based upon VA regulations was denied, including with respect to the VA loan guaranty program). Indeed, as noted by the United States Supreme Court, rights of action must be created by Congress and cannot be created by an agency's regulations if the statute authorizing the regulations does not in and of itself create a right of action. See Alexander v. Sandoval, 532 U.S. 275, 286, 291 (2001). With respect to the VA home loan guaranty program, federal courts have found that the statute creates no implied right of action. See Wilkins v. Wells Fargo Bank, N.A., C/A No. 2:15-cv-00566, 2016 WL 6775692, at *2 n.5 (E.D. Va. Nov. 15, 2016) (citing Alexander, 532 U.S. at 286; Rank v. Nimmo, 677 F.2d 692, 697 (9th Cir. 1982); Simpson v. Cleland, 640 F.2d 1354, 1358 (D.C. Cir. 1981)). Thus, the plaintiff does not have a private right of action under any regulations promulgated by the VA in relation to the VA home loan guaranty program. For example, with respect to the plaintiff's assertion that Wells Fargo could not request payment of the guaranty because it failed to notify the VA regarding the foreclosure proceedings, by statute, if Wells Fargo failed to report the foreclosure to the VA, the VA can deny its request for payment of the guaranty - and the plaintiff cannot object on the VA's behalf. See Hayes v. JP Morgan Chase Bank, et al., C/A No. 3:13-cv-01884-JFA-SVH, 2014 WL 12609313, at *1 (D.S.C. July 8, 2014) (citing 38 U.S.C. § 3703).
Further, to the extent the plaintiff's claim is better construed as asserting that he has wrongfully been denied a VA benefit in the form of a VA loan guaranty because of the previously paid guaranty to Wells Fargo, the court is without jurisdiction to address this claim. Under the doctrine of sovereign immunity, the United States cannot be sued without its consent. United States v. Testan, 424 U.S. 392-93 (1976). Sovereign immunity protects the United States (even when sued under the auspices of an individual federal department/agency, such as in this action) from liability and deprives a court of subject matter jurisdiction over claims against the United Sates. Corson v. Sec'y of Veterans Affairs, C/A No. 1:09-cv-00049, 2010 WL 532382, at *7-8 (N.D. W.Va. Feb. 8, 2010) (internal citations omitted); Cooper v. Dep't of Veteran Affairs, C/A No. 3:08-cv-00394-RJC, 2009 WL 2020794 (W.D. N.C. July 6, 2009); see also Larson v. Domestic & Foreign Commerce Corp., 337 U.S. 682, 687-88 (1949) (noting that even though an action is nominally brought against a federal agency it is considered as brought against the sovereign). With respect to the VA, the United States has not waived its sovereign immunity as to review of VA benefits decisions - such as denial of a request for a VA loan guaranty - by any court except for the United States Court of Appeals for Veterans Claims (“CAVC”), the United States Court of Appeals for the Federal Circuit, and the United States Supreme Court. See Corson, 2010 WL 532382, at *7 (citing Veterans' Judicial Review Action (“VJRA”), Pub. L. No. 100-687, Civ. A, section 101, 102 Stat. 4105 (1988); In re Russell, 155 F.3d 1012, 1013 (8th Cir. 1998)). For example, by statute, the VA has discretion in computing the aggregate amount of a guaranty available to a veteran who has previously used the entitlement. 38 U.S.C. § 3702(b). However, pursuant to 38 U.S.C. § 511(a), the Secretary of the VA is responsible for deciding all questions concerning the provision of benefits to veterans in addition to their dependants or survivors. 38 U.S.C. § 511(a). If a veteran is dissatisfied with the Secretary's decision, an appeal lies with the Board of Veterans' Appeals. 38 U.S.C. § 7104(a); 38 C.F.R. § 20.101(a). Appeals from the Board of Veterans' Appeals are heard in the CAVC. 38 U.S.C. § 7252(a). Appeals from the CAVC are heard by the United States Court of Appeals for the Federal Circuit (and appeals from the Federal Circuit are heard by the United States Supreme Court upon certiorari). 38 U.S.C. §§ 7252(c), 7292. In light of the foregoing, the court lacks jurisdiction to review the plaintiff's claim regarding his VA benefit of a VA loan guaranty and the claim should be dismissed.
Parent Loan
The plaintiff also contends that Wells Fargo and the Secretary of Education violated his rights with respect to a parent loan taken out by Mrs. Wright (doc. 1 at 2-4). The plaintiff further contends that he has standing to bring this claim because he has indemnified his wife and stands as a real party-in-interest (Id.). As an initial matter, as previously noted by this court, the plaintiff may not represent his wife in this action and pursue claims regarding a parent loan taken out by Mrs. Wright. See Myers v. Loudon Cnty. Pub. Sch., 418 F.3d 395, 400 (4th Cir. 2005) (noting that although an individual has the right to represent himself/herself by statute - 28 U.S.C. § 1654 - that right does not “create a coordinate right to litigate for others”). The plaintiff cannot circumvent the statute by alleging that he has agreed to indemnify his wife for the parent loan; indeed, even a power of attorney is not sufficient to allow a pro se party to represent another party's interest in federal court. See Sanders v. Warden of Allendale Corr. Inst., C/A No. 2:17-cv-01819-HMH-MGB, at doc. 48 p.3 n.1 (D.S.C. February 23, 2018) (collecting cases recognizing that a pro se party may not represent another pro se party even pursuant to a power of attorney) (internal citations omitted). As noted by the Honorable Henry M. Herlong, Senior United States District Judge, “[t]here is no evidence before the court to show that [the plaintiff] is the real party in interest. Clearly, [the plaintiff], a pro se litigant, may not represent his wife in the prosecution of her claims regarding the Parent Loan” (doc. 19 at 6 n.2 (citing Myers, 418 F.3d at 400)). Notably, the plaintiff's assertion that he is a party in interest to the parent loan was specifically rejected in the Foreclosure Action:
Mr. Wright: Yes, Your Honor, with respect to Jill Wright's motion, my understanding is it's not before the Court, but I do have an Assumption and Indemnification Assignment Agreement between her and me pursuant to our divorce where that becomes my -- that claim that's being asserted against her becomes my obligation. So, if it's before the Court, I can speak to it.
By the Court: Unless you're an attorney who is representing Jill Wright, then, no, sir. She has filed the motion on her own, and she's not present. So, I'm deeming -
Mr. Wright: Right. Then I can -- it's now my obligation is my point.
By the Court: Sir?
Mr. Wright: It's not the -- I don't believe it's before the Court.
By the Court: She's filed it. I expedited these motions at your request. I'm deeming that she has abandoned her motion. So, I'll be glad to hear from you on your motions. ....
By the Court: Again, you cannot -- unless you're an attorney, you cannot assert a motion that another party has filed.
Greenville County Public Index (enter the plaintiff's name and 2012CP2305587) (last visited April 4, 2022) (transcript filed on March 16, 2016, pp. 5-6). As such, because the plaintiff may not bring claims on behalf of Mrs. Wright, the Parent Loan claim is subject to summary dismissal.
RECOMMENDATION
The undersigned is of the opinion that the plaintiff cannot cure the defects identified above by amending his complaint. See Bing v. Brivo Sys., LLC, 959 F.3d 605 (4th Cir. 2020) (citing Goode v. Cent. Va. Legal Aid Soc'y, 807 F.3d 619 (4th Cir. 2015); In re GNC Corp., 789 F.3d 505 (4th Cir. 2015); Chao v. Rivendell Woods, Inc., 415 F.3d 342 (4th Cir. 2005); Domino Sugar Corp. v. Sugar Workers Local Union 392 of United Food and Com. Workers Int'l Union, 10 F.3d 1064 (4th Cir. 1993)). As noted in more detail above, this action is subject to dismissal for several reasons (including res judicata); thus, the undersigned recommends that the court decline to automatically give the plaintiff leave to amend his complaint. Accordingly, based upon the foregoing, the Court recommends that the District Court dismiss this action without prejudice and without issuance and service of process. The attention of the parties is directed to the important notice on the next page.
IT IS SO RECOMMENDED.
Notice of Right to File Objections to Report and Recommendation
The parties are advised that they may file specific written objections to this Report and Recommendation with the District Judge. Objections must specifically identify the portions of the Report and Recommendation to which objections are made and the basis for such objections. “[I]n the absence of a timely filed objection, a district court need not conduct a de novo review, but instead must ‘only satisfy itself that there is no clear error on the face of the record in order to accept the recommendation.'” Diamond v. Colonial Life & Acc. Ins. Co., 416 F.3d 310 (4th Cir. 2005) (quoting Fed.R.Civ.P. 72 advisory committee's note).
Specific written objections must be filed within fourteen (14) days of the date of service of this Report and Recommendation. 28 U.S.C. § 636(b)(1); Fed.R.Civ.P. 72(b); see Fed.R.Civ.P. 6(a), (d). Filing by mail pursuant to Federal Rule of Civil Procedure 5 may be accomplished by mailing objections to:
Robin L. Blume, Clerk United States District Court 250 East North Street, Room 2300 Greenville, South Carolina 29601
Failure to timely file specific written objections to this Report and Recommendation will result in waiver of the right to appeal from a judgment of the District Court based upon such Recommendation. 28 U.S.C. § 636(b)(1); Thomas v. Arn, 474 U.S. 140 (1985); Wright v. Collins, 766 F.2d 841 (4th Cir. 1985); United States v. Schronce, 727 F.2d 91 (4th Cir. 1984).