Opinion
3-24-bk-00433-JAB Adv. 3:24-ap-32-JAB
08-08-2024
In re: Sobhi Y. Hussein, Debtor. v. U.S. BANK, Defendant. Sobhi Y. Hussein, Plaintiff,
Chapter 13
ORDER GRANTING MOTION TO DISMISS
Jacob A. Brown United States Bankruptcy Judge
This proceeding came before the Court upon U.S. Bank's ("Defendant") Motion to Dismiss Plaintiff Sobhi Y. Hussein's ("Plaintiff") Complaint, Plaintiff's Objection to Motion to Dismiss (the "Response"), and Defendant's Reply to [the Response] ("the Reply").
Doc. 8.
Doc. 12.
Doc. 16.
Background
On or about March 28, 2007, Plaintiff Sobhi Hussein executed and delivered a Home Equity Line of Credit for $288,000 and a mortgage to Bank of America, which was assigned to Defendant, U.S. Bank. On March 17, 2023, Defendant initiated a foreclosure action against Plaintiff in the 4th Judicial Circuit Court in Duval County (the "Circuit Court"), Case No. 12-2022-CA-003249. On December 7, 2023, the Circuit Court entered a Final Judgment of Foreclosure against the Plaintiff (the "Foreclosure Judgment"). Plaintiff filed a notice of appeal (the "Appeal") to the Fifth District Court of Appeal (the "DCA") on January 11, 2024, Case No. 5D24-101, and subsequently filed a Chapter 13 bankruptcy petition on February 13, 2024. The DCA entered a stay of appeal on February 20, 2024, pending bankruptcy.
United States Bank Trust N.A. v. Ramona A. Hussein, 2023 Fla. Cir. LEXIS 1993 (Fla. 4th Cir. Ct. Dec. 8, 2023).
Plaintiff filed this Adversary Complaint (the "Complaint") on March 21, 2024, asserting Breach of Contract and Accounting claims against Defendant. Defendant filed the Motion to Dismiss on April 30, 2024, to which Plaintiff filed the Response. Defendant filed the Reply on May 31, 2024.
Allegations in the Complaint
The Complaint seeks a Declaratory Judgment that the Statute of Frauds was satisfied by partial performance and that the accounting by the Circuit Court was incorrect. Plaintiff argues that the Foreclosure Judgment was improper and urges this Court to reevaluate it.
First, Plaintiff asserts a breach of contract claim. He argues that the Statute of Frauds was satisfied to show that the interest rate of 2% was agreed upon, but the Banking Statute of Frauds bars actions for breach of contract based on a Trial Modification Plan, as the Plaintiff contended in the state court proceedings.
See Geiser v. Caliber Home Loans, Inc., No. 6:16-cv-786-Orl-GJK, 2016 WL 11735091 (M.D. Fla. Oct. 27, 2016).
Second, the accounting claim asserts that Defendant miscalculated the amount owed. The Circuit Court's calculation differed from Defendant's and Plaintiff's calculations.
Discussion
I. The complaint fails to state a claim upon which relief can be granted.
To survive a motion to dismiss a complaint, sufficient factual matter must be present to "state a claim to relief that is plausible on its face." Under Fed.R.Civ.P. 8(a)(2), a pleading must contain a "short and plain statement of the claim showing that the pleader is entitled to relief." A complaint may not include conclusions that are masked as factual statements. A well-pleaded claim shows a plausible claim for relief, not simply a possible claim for relief. Notably, pleadings by pro se litigants are to be construed liberally.
Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (citing Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)).
Twombly, 550 U.S. at 555.
Ashcroft, 556 U.S. at 679.
In re Langley, No. 21-12002, 2022 WL 351223, at *2 (11th Cir. Feb. 7, 2022) (citing Tannenbaum v. United States, 148 F.3d 1262, 1263 (11th Cir. 1998)).
Plaintiff's Complaint does not meet the necessary pleading standard to survive a 12(b)(6) motion to dismiss. The Twombly standard requires that a pleader must assert enough factual allegations that, taken to be true, raise a right to relief above the speculative level. Furthermore, the Court may dismiss a complaint on a dispositive issue of law to which no construction of the facts would support the cause of action.The Complaint fails to state a claim for which this Court can grant relief.
Twombly, 550 U.S. at 556.
Marshall Cty. Bd. of Educ. v. Marshall Cty. Gas Dist., 992 F.2d 1171, 1174 (11th Cir. 1993).
Plaintiff's arguments in this adversary proceeding and the Objection to Claim 3 of U.S. Bank in Plaintiff's main bankruptcy case, Case No. 3-24-bk-00433-JAB, all reiterate the arguments made in the Circuit Court proceedings. The Circuit Court rejected these arguments because they fail to state a claim for which relief may be granted, and the Court will not readdress them here.
The Motion to Dismiss asserts that the Rooker-Feldman doctrine applies. The Rooker-Feldman doctrine bars only "cases brought by state-court losers complaining of injuries caused by state-court judgments rendered before the district court proceedings began and inviting district court review and rejection of those judgments." The Rooker-Feldman doctrine only deprives a federal court of subject matter jurisdiction when state court proceedings have ended. The Eleventh Circuit has held that state proceedings have not ended for purposes of Rooker-Feldman when an appeal from the state court judgment is pending at the time the federal complaint is introduced, complaining of injury caused by that state court judgment and invites review of that judgment. Here, Plaintiff's state court proceedings have not ended. Plaintiff has appealed the Final Judgment of Foreclosure to the DCA, where the proceedings are stayed pending this bankruptcy. Nonetheless, the Court finds that the Complaint fails to state a plausible claim for relief, even when construed liberally.
Behr v. Campbell, 8 F.4th 1206, 1212 (11th Cir. 2021) (citing Exxon Mobile Corp. v. Saudi Basic Indus. Corp., 544 U.S. 280, 284 (2005)).
Nicholson v. Shafe, 558 F.3d 1266, 1268 (11th Cir. 2009).
Id. at 1276.
II. Even if the Complaint stated a claim for which relief could be granted, the Court would abstain.
Even if the Court did not grant the Motion to Dismiss, it would abstain from hearing this adversary proceeding pursuant to 28 U.S.C. § 1334(c)(1). Under § 1334(c), the Court may abstain from hearing a particular proceeding in the interests of justice or comity with State courts. Here, the Complaint asserts claims that are the subject of state law, and the Final Judgment of Foreclosure is now the subject of an appeal to the DCA. Discretionary abstention is appropriate when an action involves matters of state law and it is in the interest of comity with State courts or respect for State law. The State court proceedings have not ended, and even if this Court did not grant the Motion to Dismiss, it would abstain in the interest of comity with the State courts. The Court finds that the issues in this case belong before the state court that handled the matter. Therefore, the Court will exercise permissive abstention pursuant to 28 U.S.C. § 1334(c)(1). Upon the foregoing, it is
Corona v. Goodyear Tire & Rubber Co., No. 8:19-cv-2483-T-23CPT, 2020 WL 13884962, at *5 (M.D. Fla. Aug. 25, 2020).
ORDERED:
1. The Motion to Dismiss is granted. This Adversary Proceeding is dismissed with prejudice.
2. Under 11 U.S.C. § 362(d), any stay imposed as to the Appeal is hereby lifted, and the parties may immediately proceed to seek completion of the Appeal. Defendant shall file bi-monthly reports on the status of the Appeal in the underlying bankruptcy case as long as the bankruptcy case remains open.
3. The Court will enter a separate order on Objection to Claim 3 of U.S. Bank in the underlying bankruptcy case.