Laura Sheldon v. Thomas Vilsack

538 F. App'x 644
CourtCourt of Appeals for the Sixth Circuit
DecidedAugust 28, 2013
Docket12-1520, 12-3905
StatusUnpublished
Cited by5 cases

This text of 538 F. App'x 644 (Laura Sheldon v. Thomas Vilsack) is published on Counsel Stack Legal Research, covering Court of Appeals for the Sixth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Laura Sheldon v. Thomas Vilsack, 538 F. App'x 644 (6th Cir. 2013).

Opinion

ALICE M. BATCHELDER, Chief Judge.

Christopher Tone, Paul and Sharon Taulbee, and Laura Sheldon, the Plaintiffs-Appellants, all purchased homes with loans made by banks and guaranteed by the United States Department of Agriculture’s (“USDA”) Rural Housing Service (“RHS”) through its Guaranteed Loan Program (“program”). They fell behind on their mortgage payments and faced foreclosure. They sued the banks that made the loans and sued the Defendants-Appellees, including RHS; Thomas Vil-sack, Secretary of the USDA; Dallas Ton-sanger, Undersecretary for Rural Development at USDA; and Tammye Treviño, Administrator of RHS (“Appellees”), under the Housing Act, 42 U.S.C. § 1441 et seq., and the Administrative Procedure Act (“APA”), 5 U.S.C. § 551 et seq. The district courts dismissed the claims against the banks and the Appellees. Now, in this consolidated appeal, the Appellants continue to argue that the Appellees failed to take actions they should have taken to prevent foreclosure. For the reasons that follow, we affirm.

I.

The Appellants’ circumstances are similar and undisputed. Tone purchased a home in 2007 with a loan from JP Morgan Chase Bank, N.A., guaranteed by RHS. Tone fell behind on his mortgage payments, and Chase eventually notified him of its intent to foreclose. Paul Taulbee purchased a home in 2006 with a loan from Villa Mortgage (the loan was later sold or assigned to U.S. Bank) and guaranteed by RHS. Taulbee fell behind on his mortgage payments, and U.S. Bank filed a complaint for foreclosure. Sheldon purchased a home in 2008 with a loan from J.P. Morgan Chase Bank, N.A., guaranteed by RHS. Sheldon fell behind on her mortgage payments, and Chase scheduled a foreclosure sale.

The Appellants’ nearly identical complaints before the district courts claimed that the Appellees violated the Housing Act and the APA when they failed to implement various parts of the Housing Act that allegedly would have helped prevent foreclosure. 1 The Appellants made seven *647 claims, asserting that they should have received the benefits of (1) moratorium relief, (2) refinancing, (3) loan assignment and reamortization, (4) loss mitigation, (5) loan modification and partial claims, (6) an alleged statutory right to appeal lenders’ decisions, and (7) constitutional due process. The Appellants sought declaratory judgments as well as injunctions, under the APA, that would require the Appellees to implement foreclosure-avoidance and loss-mitigation provisions of the Housing Act. 2 The Appellees moved the district courts to dismiss claims (1), (4), (6), and (7) for lack of subject-matter jurisdiction under Federal Rule of Civil Procedure 12(b)(1). They also argued that claims (1)-(6) should be dismissed for failure to state a claim under Rule 12(b)(6).

The district courts dismissed claims (1) and (4) for lack of subject-matter jurisdiction, and claims (2), (3), and (5) for failure to state a claim upon which relief could be granted. They dismissed claims (6) and (7) for lack of standing.

On appeal, the Appellants continue to argue the seven claims outlined above. Despite the wording of individual provisions in the Housing Act, they argue that Congress’s national housing policy, which prefaces the Housing Act and is found at 42 U.S.C. § 1441, eliminates the Appellees’ discretion over whether to implement certain provisions of the Act. They argue that some of their claims should be addressed under 5 U.S.C. § 706(2), not § 706(1). And they argue that their statutory and constitutional due-process rights were violated.

II.

We review de novo a district court’s decision to grant a motion under Rule 12(b)(1) to dismiss for lack of subject-matter jurisdiction. Madison-Hughes v. Sha-lala, 80 F.3d 1121, 1123 (6th Cir.1996). ‘We review de novo whether the district court properly dismissed a complaint pursuant to Rulel2(b)(6).” Ashland Hosp. Corp. v. Serv. Emps. Int’l Union, Dist. 1199, 708 F.3d 737, 740 (6th Cir.2013). We also review de novo the dismissal of a claim for lack of standing. Prime Media, Inc. v. City of Brentwood, 485 F.3d 343, 348 (6th Cir.2007).

“Because this court’s de novo review involves only application of legal propositions to the undisputed facts in the record, we may affirm on any grounds supported by the record even if different from the reasons of the district court.” Abercrom-bie & Fitch Stores, Inc., v. Am. Eagle Outfitters, Inc., 280 F.3d 619, 629 (6th Cir.2002). Before we may address a claim’s merits, we must assess whether we have jurisdiction over that claim. See Steel Co. v. Citizens for a Better Env’t, 523 U.S. 83, 101, 118 S.Ct. 1003, 140 L.Ed.2d 210 (1998) (finding there is no “doctrine of hypothetical jurisdiction” (internal quotation marks omitted)). Without jurisdiction the court cannot proceed at all in any cause. Jurisdiction is power to declare the law, and when it ceases to exist, the only function remaining to the court is that of announcing the fact and dismissing the cause.” Id. at 94, 118 S.Ct. 1003 (1998) (internal quotation marks omitted). We cannot assume jurisdiction for the purpose *648 of deciding the merits of the case. Id. at 94-95, 118 S.Ct. 1003.

A.

The district courts’ opinions provide overviews of the Housing Act. The district court in Tone explained:

The Housing Act of 1949, 42 U.S.C. § 1441 et seq. (“the Housing Act”), was enacted to promote “the elimination of substandard and other inadequate housing through the clearance of slums and blighted areas, and the realization as soon as possible of the goal of a decent home and a suitable living environment for every American family.” 42 U.S.C. § 1441. In furtherance of that goal, Section 502(a) of the Housing Act authorizes the Secretary of Agriculture (the “Secretary”) to make direct loans to borrowers seeking to finance affordable housing in rural areas. See 42 U.S.C. § 1472(a). RHS, an agency within USDA, implements Section 502 programs.

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538 F. App'x 644, Counsel Stack Legal Research, https://law.counselstack.com/opinion/laura-sheldon-v-thomas-vilsack-ca6-2013.