Speake v. The Bank of New York Mellon

2017 DNH 076

• Court: District Court, D. New Hampshire
• Decided: April 17, 2017
• Docket: 17-cv-20-JD
• Status: Published

Opinion

UNITED STATES DISTRICT COURT FOR THE DISTRICT OF NEW HAMPSHIRE

Jack T. Speake

v. Civil No. 17-cv-20-JD Opinion No. 2017 DNH 076 The Bank of New York Mellon f/k/a Bank of New York, as Trustee of the CWALT, Inc. Alternative Loan Trust 2006-6CB, Mortgage Pass-Through Certificates Series 2006-6CB

O R D E R

Jack T. Speake, proceeding pro se, filed a petition in

state court to enjoin The Bank of New York Mellon, as trustee,

of the CWALT, Inc. Alternative Loan Trust 2006-6CB, Mortgage

Pass-Through Certificates Series 2006-6CB (“Bank”) from

foreclosing on his property and seeking damages. The state

court denied Speake’s request for an ex parte temporary

restraining order. The Bank removed the case to this court and

moved to dismiss. Speak was granted an extension of time to

file a response to the motion to dismiss but failed to do so.

Standard of Review

In considering a motion under Rule 12(b)(6), the court

takes the factual allegations in the complaint as true and draws

reasonable inferences from those facts in favor of the plaintiff’s claims. Sanders v. Phoenix Ins. Co., 843 F.3d 37,

42 (1st Cir. 2016). Based on the properly pleaded facts, the

court determines whether the plaintiff has stated “a claim to

relief that is plausible on its face.” Bell Atl. Corp. v.

Twombly, 550 U.S. 544, 570 (2007). A claim is plausible if the

facts as pleaded, taken in the context of the complaint and in

light of “judicial experience and common sense,” allow the court

to draw “the reasonable inference that the defendant is liable

for the misconduct alleged.” Ashcroft v. Iqbal, 556 U.S. 662,

678-79 (2009).

In addition to the properly pleaded allegations in the

complaint, the court may consider documents that the plaintiff

filed with the complaint. See Haley v. City of Boston, 657 F.3d

39, 46 (1st Cir. 2011). In this case, Speake filed the mortgage

and the note, along with other documents, with his complaint.

Those documents are considered for purposes of the Bank’s motion

to dismiss.

Background1

In the petition, Speake alleges that he and his wife took

title to property at 33 Route 4A, Wilmot, New Hampshire, in

April of 2006. Speake alleges that they obtained a loan of

1 Much of the petition consists of legal conclusions which cannot be considered for purposes of determining whether a plaintiff has stated a claim for relief. See Garcia-Catalan v. United States, 734 F.3d 100, 103 (1st Cir. 2013).

2 $215,300.00, which was secured by the property and that “[o]n

information and belief [he] allegedly executed a Promissory Note

(the ‘Note’) and Mortgage on the Property securing the Note (the

‘Mortgage’) with [Countrywide Home Loan, Inc. (‘CWHL’)].” He

also states: “The Note and Mortgage/Notice to Cancel Rescission

and HUD-1 Settlement Agreement were ever [sic] returned to the

Speake’s after CWHL Settlement agent left the Speake’s kitchen.”

In the Speakes’ mortgage, MERS was the nominee for the

lender, Countrywide Home Loans, Inc., and was named as the

mortgagee. MERS assigned the mortgage to BAC Home Loans

Servicing, LP on September 15, 2010, and the assignment was

recorded on September 16, 2010, in the Merrimack County Registry

of Deeds. Bank of America, N.A., as successor by merger to BAC

Home Loans Servicing, LP assigned the mortgage to the Bank on

June 11, 2011, and the assignment was recorded on June 14, 2011.

A second assignment from Bank of America, N.A. as successor by

merger to BAC Home Loans Servicing, LP, dated December 22, 2011,

was recorded on December 23, 2011.

Speake contends that the mortgage that is recorded in the

registry was fraudulently notarized by a justice of the peace

and that any documents the Bank might produce would be

forgeries. He alleges that CWHL has never provided evidence of

a note or mortgage. He further alleges that he mailed a “Notice

3 to Rescind” on May 20, 2015, and that the notice is recorded in

the registry of deeds.

Beginning in 2008, the Speakes attempted to have their loan

modified, without success. Speake alleges that they have been

fighting to stop foreclosures since 2010.

Apparently, there was a foreclosure scheduled on the

property for March 14, 2016, which was cancelled. Thereafter,

Speake had communications with Select Portfolio Services, Inc.

Speake alleges misconduct by Select Portfolio Services, real

estate websites, and the Bank, pertaining to representations

about a foreclosure that had not happened.

A foreclosure of the property was scheduled for November 8,

2016. Speake states that he did not receive notice of the

planned foreclosure. On November 8, 2016, Speake filed the

petition in state court, seeking, among other things, an ex

parte temporary restraining order to stop the foreclosure sale.

The state court denied the request for a restraining order. The

Bank removed the case to this court.

Discussion

Speake alleges in Counts I through III that the Bank lacks

the authority to foreclose. Speake alleges in Counts IV through

VII that the Bank breached the duty of good faith and fair

dealing, that he did not default, that there is no mortgage

4 contract to enforce, and that the Bank lacks standing. Count

VIII is titled “Rescission”. The Bank moves to dismiss all of

the claims.

A. Authority to Foreclose

Speake contends that the Bank lacks the authority to

foreclose on the property because it does not have the “Original

Wet-Ink Note,” because of gaps in the chain of assignment of the

mortgage, and because the Bank does not possess both the note

and the mortgage. The Bank moves to dismiss on the grounds that

the claims are not supported by facts, Speake does not state a

claim, and that Speake has not alleged any harm.

When the mortgage shows an agency relationship between the

lender and the mortgagee, with the ability to assign those

interests, and the subsequent assignments are valid, an assignee

of the mortgagee, as the agent of the noteholder, has the

authority to exercise the power of sale under the mortgage

without holding the note. Bergeron v. N.Y. Comm’ty Bank, 168

N.H. 63, 71 (2015). When a mortgage states that MERS is “acting

solely as nomine for Lender and Lender’s successors and

assigns,” it creates an agency relationship between MERS and the

lender. Id. at 70. Then, if the mortgage so provides, MERS has

the right to exercise any and all of the rights of the lender,

including the authority to foreclose and sell the property. Id.

5 That is the case here. Speake’s mortgage identifies MERS

as the nominee for Countrywide Home Loans, Inc. in the same

language that was used in the mortgage at issue in Bergeron.

Speake’s mortgage also grants MERS, as nominee for Countrywide,

the right to exercise all of the lender’s interests, including

the right to foreclose and sell the property, as was the case in

Bergeron. Therefore, as long as the assignment of the mortgage

to the Bank is valid, the Bank has the authority to foreclose

and sell the property.

Speake does not explain what defect he finds in the chain

of assignments between MERS and the Bank.2 To the extent he

relies on the second assignment from BAC to the Bank in December

of 2011, he does not show a defect. Instead, the second

2 Speake attached to the complaint a copy of an “Expert Summary Report” prepared by Brown & Associates of Beverly Farms, Massachusetts, that is dated June 29, 2015. Doc. 1-1, at 58. The report states that “Brown & Associates LLC was retained to conduct a review of the securitization documents publicly available for [Speake’s property’s address] and subsequent documentation for purposes of making the following determinations: (1) identify the terms of the compliance with the Trust; and (2) review whether the terms of compliance have been met or not met after a consideration of review of additional documentation made available for purposes of this review.” Id. at 59. The Brown report provides an opinion that the assignments of the mortgage “did not occur in accordance with the terms of Prospectus and Pooling and Servicing Agreement.” That opinion, however, does not affect the validity of the mortgage assignments with respect to the Bank’s right to foreclose on Speake’s mortgage. See, e.g., Proal v. JP Morgan Chase & Co., 202 F. Supp. 3d 209, 214 (D. Mass. 2016); Dove v. Bank of N.Y. Mellon, 2016 WL 799117, at *4 (D.N.H. Feb. 29, 2016).

6 assignment merely confirms the first assignment, which was made

in September of 2010. Dyer v. Wells Fargo, N.A., 841 F.3d 550,

554 (1st Cir. 2016). Because Speake has not alleged a defect in

the chain of assignment to the Bank, the Bank has authority to

foreclose and sell the property.

B. Good Faith and Fair Dealing

Speake alleges that the Bank breached the duty of good

faith and fair dealing by denying him loan modifications because

the Bank or its servicing agents lost the documents he provided.

New Hampshire recognizes an implied duty of good faith and fair

dealing in contractual relationships. Birch Broad, Inc. v.

Capitol Broad. Corp., 161 N.H. 192, 198 (2010). It is well-

settled, however, that mortgagees are not required under the

duty of good faith and fair dealing to consider a request or an

application for a loan modification. Mader v. Wells Fargo Bank,

N.A., 2017 WL 177619, at *4 (D.N.H. Jan. 17, 2017) (citing

cases). Therefore, Speake has not stated a claim for breach of

the duty of good faith and fair dealing.

C. Default

Speake states that “[p]ursuant to the provisions of the

Pooling Servicing Agreement and other related agreements by the

parties to said Series 2006-6CB Trust, other parties including

the servicers and/or insurers have assumed or guaranteed or

7 insured the payment obligations of the Speake’s [sic] under

their Promissory Note thereby curing and eliminating any default

under the promissory note according to its own terms.” Doc. no.

1-1, at 18, Petition, ¶ 93. In support, Speake alleges only

that the “internal accounting and tax records of said Trust”

will show that his mortgage loan has been paid.

The theory that a mortgage loan was paid pursuant to

agreements between the Trust and other entities has been raised

and rejected in other cases. Payments made under Pooling

Service Agreements are “pursuant to separate contractual

obligations between the servicers and the trusts” and, for that

reason, are not made on behalf of the mortgagor. Ouch v. Fed.

Nat’l Mortg. Ass’n, 2013 WL 139765, at *3 (D. Mass. 2013); see

also In re Rivera, 2016 WL 5868693, at *11 (B.A.P. 9th Cir. Oct.

6, 2016) (explaining operation of Pooling Servicing Agreements);

Pulliam v. PennyMac Mortg. Inv. Tr. Holding I LLC, 2014 WL

3784238, at *4 (D. Me. July 31, 2014) (lack of servicing

agreement not material when allegations do not support claim).

Therefore, Speake does not state a claim based on a theory

that his mortgage note is not in default.

D. Mortgage Contract

Speake contends that there is no mortgage contract because

Countrywide did not provide funds under the mortgage loan and is

8 not the identified lender. As a result, Speake asserts,

Countrywide lacked authority to enforce or assign the mortgage.

The language of the mortgage itself contradicts Speake’s

allegations.3

Countrywide is identified as the “Lender” in the mortgage

agreement and references the note through which Speake borrowed

$215,300.00. Speake alleged in the complaint that he and his

wife obtained a loan of $215,300.00 from Countrywide in 2006.

Therefore, Speake does not allege a viable claim that there is

no mortgage contract.

E. No Standing

In support of the claim titled “No Standing,” Speake

alleges that his property has been taken “by false pretenses and

false advertising regarding pending listings of Petitioners

property without it ever having been foreclosed on.” Doc. 1-1,

at 20, Petition, ¶ 101. He cites advertisements on real estate

websites, Trulia and Zillow, and states that he was promised

thousands of dollars to leave the property or face eviction. He

asserts that the advertising was “false swearing, slandering off

the Petitioners title and defamation of character.” Id. ¶ 102.

To the extent Speake intended to rely on his assertion that 3

the mortgage recorded in the registry of deeds was fraudulently notarized, that assertion does not support his claim. Speake does not deny that he signed the mortgage.

9 To the extent Speake intended to challenge the Bank’s

standing to foreclose and sell the property, that claim was

addressed in Part A, above. The remainder of Count VII does not

address standing but instead seems to raise slander of title and

defamation.

A claim of slander of title must be supported with facts

showing that the defendant maliciously published false

statements that disparaged his right to the property and special

damages that resulted. See Rosa v. Mortg. Elec. Sys., Inc., 821

F. Supp. 2d 423, 434 (D. Mass. 2011); Sprague Corp. v. Sprague,

855 F. Supp. 423, 437 (D. Me. 1994). Speake alleges that Trulia

and Zillow have shown on their websites that his property was

foreclosed and sold for $31,000 and that a bank owns the

property. Speake provides no facts to show that the Bank had

any involvement in providing the information shown on the cited

websites, that the information disparages his right to the

property, or that he suffered any special damages as a result of

the information on the websites. Therefore, Speake provides no

factual allegations to support a claim of slander of title.

Under New Hampshire law, “to establish defamation, there

must be evidence that a defendant published a false and

defamatory statement of fact about the plaintiff to a third

party.” Moss v. Camp Pemigewassett, Inc., 312 F.3d 503, 507

(1st Cir. 2002) (internal quotation marks omitted). Speake

10 alleges that Trulia and Zillow, not the Bank, published false

information about his property. His allegations do not support

a claim for defamation against the Bank.

F. Rescission

Speake contends that he is entitled to have the mortgage

loan rescinded, under the Truth in Lending Act (“TILA”) and the

Real Estate Settlement Procedures Act (“RESPA”), because he sent

a notice of rescission by certified mail on May 15, 2015, which

was recorded on March 11, 2016.4 The Bank moves to dismiss the

claim on the ground that it is time barred.

Under TILA, a borrower in a consumer credit transaction

that provides a security interest in the principal dwelling of

the borrower “shall have the right to rescind the transaction

until midnight of the third business day following the

consummation of the transaction or the delivery of the

information and rescission forms” and other information. 15

U.S.C. § 1635(a). Regardless of when or if the required

information, forms, and disclosures are provided, a borrower’s

“right of rescission shall expire three years after the date of

RESPA does not appear to apply to this claim. To the extent 4

Speake intended to raise an issue about a QWR under RESPA, he has not alleged facts to support the claim. 12 U.S.C. §§ 2605(e)(1) & 2605(f). See, e.g., Ramos-Gonzalez v. First Bank of P.R., 2015 WL 6394409, at *2-*3 (D.P.R. Oct. 22, 2015) (explaining claims under RESPA).

11 consummation of the transaction or upon the sale of the

property, whichever occurs first” unless an agency proceeding to

enforce TILA is begun in the meantime that involves the

borrower’s right to rescind. § 1635(f).

In this case, Speake and his wife obtained the mortgage

loan in March of 2006. Speake did not send a notice of

rescission until May of 2015. Because Speake’s right to rescind

expired long before May of 2015, the claim is time barred.

Conclusion

For the foregoing reasons, the defendant’s motion to

dismiss (document no. 2) is granted. All of the claims in the

plaintiff’s petition are dismissed.

The clerk of court shall enter judgment accordingly and

close the case.

SO ORDERED.

__________________________ Joseph DiClerico, Jr. United States District Judge

April 17, 2017

cc: Jack T. Speake, pro se Michael P. Trainor, Esq. Mary Ellen Manganelli, Esq.