Opinion
SA-24-CV-00054-XR
02-28-2024
BLANCA CANTU, Plaintiff v. FREEDOM MORTGAGE CORPORATION, Defendant
ORDER GRANTING MOTION TO DISMISS
XAVIER RODRIGUEZ UNITED STATES DISTRICT JUDGE
On this date, the Court considered Defendant's motion to dismiss (ECF No. 5). After careful consideration, Defendant's motion is GRANTED.
BACKGROUND
Plaintiff Bianca Cantu seeks to prevent Defendant Freedom Mortgage Corporation (“Freedom”) from foreclosing on the real property located at 7822 Winerstone Drive in San Antonio, Texas (the “Property”).
Plaintiffs purchased the Property on September 16, 2015, with funds obtained through a purchase-money loan (the “Loan”) in the original principal amount of a loan of $124,208.00, as evidenced by a promissory note and security instrument (“Deed of Trust”) in favor of the Mortgage Electronic Registration Systems, Inc., as nominee of the lender, First California Mortgage Company. See ECF No. 5-1 at 2. The Deed of Trust was later assigned to Freedom. See ECF No. 5-3 at 2. In October 2022, Plaintiff and Freedom executed a loan modification agreement, reflecting a new principal balance of $156,285.94 and extended maturity date of November 1, 2062. ECF No. 5-4.
Defendant has attached as exhibits to its motion copies of the Deed of Trust, assignment documents, and a loan modification. See ECF Nos. 5-1, 5-2, 5-3, and 5-4. The Supreme Court has held that in deciding a motion to dismiss, a court may consider documents incorporated into the complaint by reference. Tellabs, Inc. v. Makor Issues & Rights, Ltd., 551 U.S. 308, 322 (2007). The court may also consider any documents attached to the complaint and any documents attached to the motion to dismiss that are central to the claim and referenced by the complaint. Lone Star Fund V (U.S.), L.P. v. Barclays Bank PLC, 594 F.3d 383, 387 (5th Cir. 2010). Because the Deed of Trust is central to the claims set forth in the Petition and referenced therein, the Court may consider them in evaluating Defendant's motion to dismiss.
Plaintiff defaulted on the mortgage loan, and a foreclosure sale was scheduled for January 2, 2024. See ECF No. 1-2 at 19. On December 29, 2023, Plaintiffs filed her original petition in state court, followed by an amended petition, the operative pleading filed on the same day. See Id. at 3-9, 17-33. Plaintiff seeks to enjoin Defendant from selling the Property, alleging that Freedom “accepted the plaintiff's performance of running behind on the mortgage,” and “has chosen not to inform the customer of the timing issues” related to the loan modification agreement. Id. at 21-22. The preamble to the amended petition references “causes of action for money damages, Breach of Contract, Request for injunctive relief, and Request for Accounting[.]” Id. Aside from a passing reference to “wrongful foreclosure,” the body of the pleading identifies causes of action for breach of contract, negligent handling of a loan modification application, and injunctive relief. See id. at 19-22. The amended petition does not allege any injury beyond the alleged “irreparable injury” that Plaintiff would suffer absent an injunction of the foreclosure sale. See id. at 20. On January 2, 2024, the state trial court issued an ex parte temporary restraining order enjoining the foreclosure sale. See id. at 31-33.
Although amended petition seeks to enjoin a foreclosure sale set for “January 2, 2023,” the Court assumes that the 2023 date is a scrivener's error and that Plaintiff intended to refer to the January 2, 2024 foreclosure sale.
On January 11, 2024, Defendant removed the action to this Court on the basis of diversity jurisdiction. ECF No. 1. Soon after, Defendant moved to dismiss Plaintiff's petition in its entirety, arguing that she has failed to state a plausible cause of action that could support her claim for injunctive relief. See ECF No. 5. No response has been filed, and the time to do so has expired.
Although Plaintiffs failed to file a response or inform the Court that the motion is unopposed as required by Local Rule CV-7(D), the Court will not treat the motion as unopposed. Rather, it will be evaluated on the merits. See Webb v. Morella, 457 Fed.Appx. 448, 452 n.4 (5th Cir. 2012) (“The Federal Rules of Civil Procedure, however, do not, by their own terms, require a party to file a response in opposition to a motion to dismiss. See FED. R. CIV. P. 12. Accordingly, the district court improperly granted the motion to dismiss for failure to state a claim solely because the Webbs failed to oppose the motion.”); Ramirez v. United States, 410 F.Supp.3d 824, 830 n.1 (S.D. Tex. 2019) (“The Court, however, may not simply grant a motion to dismiss as unopposed; it must consider the merits of the motion.”).
DISCUSSION
I. Legal Standard
Federal Rule of Civil Procedure 12(b)(6) allows a party to move for the dismissal of a complaint for “failure to state a claim upon which relief can be granted.” 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 Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)). “A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Iqbal, 556 U.S. at 678. A claim for relief must contain: (1) “a short and plain statement of the grounds for the court's jurisdiction”; (2) “a short and plain statement of the claim showing that the pleader is entitled to the relief”; and (3) “a demand for the relief sought.” FED. R. CIV. P. 8(A). A PLAINTIFF “MUST PROVIDE ENOUGH FACTUAL ALLEGATIONS TO DRAW THE REASONABLE INFERENCE THAT THE ELEMENTS EXIST.” Innova Hosp. San Antonio, L.P. v. Blue Cross & Blue Shield of Ga., Inc., 995 F.Supp.2d 587, 602 (N.D. Tex. Feb. 3, 2014) (citing Patrick v. WalMart, Inc.-Store No. 155, 681 F.3d 614, 617 (5th Cir. 2012)); see also Torch Liquidating Trust ex rel. Bridge Assocs. L.L.C. v. Stockstill, 561 F.3d 377, 384 (5th Cir. 2009) (“[T]he complaint must contain either direct allegations or permit properly drawn inferences to support every material point necessary to sustain a recovery”) (internal quotation marks and citations omitted).
In considering a motion to dismiss under Rule 12(b)(6), all factual allegations from the complaint should be taken as true, and the facts are to be construed in the light most favorable to the nonmoving party. Fernandez-Montes v. Allied Pilots Ass'n, 987 F.2d 278, 284 (5th Cir. 1993).
Still, a complaint must contain “more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do.” Twombly, 550 U.S. at 555. “‘[N]aked assertions' devoid of ‘further factual enhancement,'” and “threadbare recitals of the elements of a cause of action, supported by mere conclusory statements,” are not entitled to the presumption of truth. Iqbal, 556 U.S. at 678 (quoting Twombly, 550 U.S. at 557); see also R2 Invs. LDC v. Phillips, 401 F.3d 638, 642 (5th Cir. 2005) (stating that the Court should neither “strain to find inferences favorable to the plaintiffs” nor accept “conclusory allegations, unwarranted deductions, or legal conclusions.”).
II. Analysis
A. Breach-of-Contract Claim
In Texas, a claim for breach of contract requires “(1) the existence of a valid contract; (2) performance or tendered performance by the plaintiff; (3) breach of the contract by the defendant; and (4) damages sustained by the plaintiff as a result of the breach.” Mullins v. TestAmerica, Inc., 564 F.3d 386, 418 (5th Cir. 2009) (quoting Aguiar v. Segal, 167 S.W.3d 443, 450 (Tex. App.- Houston 2005, pet. denied)). Moreover, to properly plead a breach-of-contract claim in a wrongful foreclosure case, “a plaintiff must identify a specific provision of the contract that was allegedly breached.” Innova Hosp. San Antonio, L.P., 995 F.Supp.2d at 602; see also Williams v. Wells Fargo Bank, N.A., 560 Fed.Appx. 233, 238 (5th Cir. 2014) (“It has been held that a claim for breach of contract of a note and deed of trust must identify the specific provision in the contract that was breached.”); Guajardo v. JP Morgan Chase Bank, N.A., 605 Fed.Appx. 240, 244 (5th Cir. 2015) (affirming dismissal of breach-of-contract claim where plaintiff did not specify which provision in the deed of trust was breached).
As Freedom correctly points out, Plaintiff does not allege that Defendant has violated any specific provision of the Note, Loan Modification Agreement, or Deed of Trust, but merely makes a vague assertion that “[t]here is no default sufficient to justify foreclosure and any alleged default has been cured or waived[.]” ECF No. 1-2 at 20. Nor does Plaintiff assert that she has suffered any damages as a result of this unspecified breach. Plaintiff has thus failed to state a plausible claim for breach of contract.
B. Negligence Claim
Freedom argues that Plaintiff's negligence claim is barred by the economic loss doctrine and otherwise fails as a matter of law because Plaintiff does not allege sufficient facts to establish that Freedom owed Plaintiff a legal duty on which to base her claims. ECF No. 5 at 4. The Court agrees.
The economic loss doctrine “generally precludes recovery in tort for economic losses resulting from a party's failure to perform under a contract when the harm consists only of the economic loss of a contractual expectancy.” In re Wheeler, 612 Fed.Appx. 763, 767 (5th Cir. 2015) (per curiam) (quoting Chapman Custom Homes, Inc. v. Dallas Plumbing Co., 445 S.W.3d 716, 718 (Tex. 2014)). When applying this doctrine, courts consider whether a defendant's conduct “would give rise to liability independent of the fact that a contract exists between the parties.” Sw. Bell Tel. Co. v. DeLanney, 809 S.W.2d 493, 494 (Tex. 1991). When no independent basis of liability exists, the economic loss doctrine applies. Id.
The operative pleading suggests no basis for independent liability. It merely asserts:
The lender was negligent in how they had handled the Loan modification process. The Lender was well aware of the timelines and their internal protocols and has chosen to not inform the customer of the timing issues related to the intersection of foreclosures and the deadlines for loan modification packages to be processed.ECF No. 1-2 at 22. But Freedom's alleged duties to keep Plaintiff apprised of the “timelines and internal protocols” and “deadlines for loan modification packages to be processed,” arises, if all from the parties' contractual relationship. See Scott v. Wells Fargo Bank, NA, No. 4:11-CV-600, 2013 WL 5450600, at *9 (E.D. Tex. Sept. 30, 2013), aff'd sub nom. Scott v. Fed. Home Loan Mortg. Corp., 605 Fed.Appx. 454 (5th Cir. 2015) (dismissing claim for negligent misrepresentation as to the loan modification process as barred by the economic loss doctrine because their injuries were “in no way independent” of the subject matter of the relevant contracts: “but for the obligations created under the Deed of Trust and Note, the Plaintiffs would not have spent the time they purportedly did corresponding about the mortgage payments, nor would the Plaintiffs' credit have been affected by the foreclosure.”) (citations omitted).
Since Plaintiff has not pled any other basis for Freedom's alleged liability, her claims are barred by the economic loss doctrine. Thus, Plaintiff's negligence claim must be dismissed with prejudice. See Scott, 2013 WL 5450600, at *9.
C. Claim for Injunctive Relief
“Under Texas law, a request for injunctive relief is not itself a cause of action but depends on an underlying cause of action.” Cook v. Wells Fargo Bank, N.A., No. 3:10-CV-0592-D, 2010 WL 2772445, at *4 (N.D. Tex. July 12, 2010) (citing Brown v. Ke-Ping Xie, 260 S.W.3d 118, 122 (Tex. App.-Houston [1st Dist.] 2008, no pet.), abrogated on other grounds by Tex Dep't of Aging & Disability Servs. v. Cannon, 453 S.W.3d 411 (Tex. 2015)). Because Plaintiff's substantive claims fail as a matter of law, they cannot support a claim for injunctive relief.
CONCLUSION
For the foregoing reasons, Defendant's motion to dismiss the Petition for failure to state a claim (ECF No. 5) is GRANTED, and Plaintiff's claims are DISMISSED WITH PREJUDICE.
A final judgment pursuant to Rule 58 will follow.
It is so ORDERED.