United States District Court, W.D. North Carolina, Statesville Division
HAROLD N. ORBAN AND VICTORIA L. ORBAN Plaintiffs,
NATIONWIDE TRUSTEE SERVICES, INC., KERRIE A. VERSTRATE, BANK OF AMERICA, AND BANK OF NEW YORK MELLON, SUCCESSOR TO JP MORGAN CHASE BANK, N.A., AS TRUSTEE FOR THE CERTIFICATE HOLDERS OF CWHEQ, INC. REVOLVING HOME EQUITY LOAN ASSET-BACKED NOTES, SERIES 2006-1 Defendants.
RICHARD L. VOORHEES, District Judge.
BEFORE THE COURT is Plaintiffs' Motion to Reconsider (Doc. 40), to which Defendants Bank of America, N.A. ("BANA") and the Bank of New York Mellon ("BNYM") have responded, (Doc. 41). Also pending is Plaintiffs' Motion for Leave to File Amended Complaint (Doc. 42), to which BANA has responded in opposition (Doc. 43). Plaintiffs have also filed a reply. (Doc. 44).
The Court notes that Plaintiffs' have brought their motion to reconsider pursuant to Rule 60(b). However, "Rule 60 pertains to relief from a final judgment, order, or proceeding, and Rule 60 is not available for relief from an interlocutory order." Slep-Tone Entm't Corp. v. Garner, No. 3:11-CV-00122, 2011 WL 6370364, at *1 (W.D. N.C. Dec. 20, 2011).
Instead, given the liberal construction afforded to pro se litigants, the Court will analyze the motion pursuant to Rule 54(b). Rule 54(b) provides that "any order... that adjudicates fewer than all the claims or the rights and liabilities of fewer than all the parties... may be revised at any time before the entry of a judgment adjudicating all the claims and the all the parties' rights and liabilities." Fed. R. Civ. Pro. 54(b). "Motions for reconsideration of an interlocutory order are appropriately granted upon (1) the discovery of new evidence, (2) an intervening development or change in the controlling law, or (3) the need to correct a clear error or prevent manifest injustice." Slep-Tone Entm't Corp. v. Garner, No. 3:11-CV-00122, 2011 WL 6370364, at *1 (W.D. N.C. Dec. 20, 2011). The Court finds cognizable grounds and therefore will reconsider its original order. To the extent the Court does not discuss grounds alleged, they are rejected.
I. ANALYSIS - MOTION TO RECONSIDER
A. The Court Will Not Modify Its Order Regarding Nationwide and Verstrate
The Court has reviewed the Orbans's argument with regard to the Court's dismissal of all claims against Verstrate. For the reasons stated in the original order, the motion to reconsider is denied with respect to this dismissal. Defendant Verstrate remains dismissed.
Further, all claims remain stayed against Defendant Nationwide pursuant to the Court's Order entered on December 3, 2014 (Doc. 36). Accordingly, the Court will not revise its order regarding Nationwide.
B. Count One
1. Assignment of the Deed of Trust and the Foreclosure Action
In the original order, the Court stated that "[h]ere, BNYM held the note and, regardless of alleged irregularities contained in filling of the deed of trust, the deed of trust necessarily followed with the note." (Doc. 34, at 9). However, there is no documentation that establishes that BNYM ever held the note. The Court takes note that the majority of Plaintiffs' allegations and arguments have revolved around whether an assignment of a note or deed of trust must be recorded in order to be enforceable against the original debtor. Plaintiffs make several arguments regarding North Carolina's recording statutes; however, they are intended to protect purchasers and encumbrancers. Hill v. Pinelawn Memorial Park, Inc., 282 S.E.2d 779, 782 1326, 7 (N.C. 1981) ("The purpose of this statute is to enable intending purchasers and encumbrancers to rely with safety on the public record concerning the status of land titles."). Moreover, assignments of deeds of trust or promissory notes need not be recorded in order to be effective. N.C. Gen. Stat. § 47-17.2. Accordingly, the Court holds that the validity of any purported assignment of the note or deed of trust does not depend on filings.
The basis of Plaintiffs' Count I is "fraud." Plaintiffs' claims raise a common-law claim for "wrongful foreclosure." "To allege a common-law claim for "wrongful foreclosure" by a mortgagor, plaintiff must allege (1) a legal duty owed to it by the foreclosing party; (2) a breach of that duty, (3) a causal connection between the breach of that duty and the injury it sustained and (4) damages." Bryson v. Ocwen Fed. Bank FSB, 2010 U.S. Dist. LEXIS 55233, at *15 (W.D. N.C. Jan. 20, 2010). "A claim for wrongful foreclosure accrues when the mortgagee conveys the property to a third party." Patterson v. DAC Corp. of North Carolina, 310 S.E.2d 783, 785 (N.C. Ct. App. 1984). It is evident from Plaintiffs' Complaint that the foreclosure action did not terminate in any Defendant's favor and the property has not been sold. Therefore, a claim for wrongful foreclosure does not exist. Further, regardless of the ownership of the note or deed of trust and the validity of any purported assignment, which is the basis of Plaintiffs' claim, the ownership of the land has never been transferred. See Porterfield v. JP Morgan Chase Bank, Nat'l Ass'n, 2013 U.S. Dist. LEXIS 152318, at *5-6 (E.D. N.C. Oct. 22, 2013) (dismissing wrongful foreclosure claim on the same grounds). Accordingly, the fraud claim is still dismissed.
2. North Carolina General Statute Section 45-93
Plaintiffs do not challenge the Court's finding with regard to North Carolina General Statute § 45-93. Accordingly, the Court will not ...