Deforest v. Bank of New York Mellon

          RULING AND ORDER ON MOTION TO DISMISS

          VICTOR A. BOLDEN UNITED STATES DISTRICT JUDGE.

         Richard DeForest and Kathleen DeForest (“Plaintiffs”) filed this lawsuit pro se, alleging that Defendants violated their rights related to a series of mortgages on the DeForests' primary residence in Darien, Connecticut. See generally Compl., ECF No. 1. Defendants now move to dismiss the Complaint in its entirety, with prejudice. Defs. Mot. to Dismiss (“Defs. Mot.”), ECF No. 10.

         For the reasons stated below, Defendants' motion is GRANTED and the case is dismissed with prejudice. The Court will also construe Plaintiffs' Response, ECF No. 22, as a motion for leave to amend the complaint. That request is DENIED.

         I. FACTUAL AND PROCEDURAL BACKGROUND

         The DeForests are residents of Darien, Connecticut. Compl. ¶ 4. Defendants - the Bank of New York Mellon, the Bank of America, and Does 1 through 100 (“Defendants”) - are banks or bank employees allegedly involved with the DeForests' mortgage on their primary residence. Compl. ¶¶ 5-10, 11.

         A. Factual Allegations

         The DeForests allege that they purchased the property at 17 Fitch Ave in Darien, Connecticut on August 4, 2004. Compl. ¶¶ 11, 42. They also allege that they “refinanced” their mortgages on the property at that time, and received a first mortgage of $515, 000 and a second mortgage of $125, 000. Compl. ¶ 11. Additionally, they allege that there was an earlier, prior mortgage of $80, 000 “that is still a lien of record . . . .” Id. In connection with the mortgages, they allege that “America's Wholesale Lender (Countrywide) placed Plaintiffs in a predatory loan with an adjustable rate” but that “America's Wholesale Lender has never been licensed to do business in Ct. and Plaintif[fs] contend this loan is void.” Id. They claim that Countrywide “illegally, deceptively, and/or otherwise unjustly qualified Plaintiffs for a loan which Countrywide knew or should have known that Plaintiffs could not qualify for or afford.” Id. ¶ 39.

         The DeForests allege that at some point Countrywide assigned the loan to Defendant Bank of New York Mellon, but they allege that they “did not receive proper notice of the two assignments or transfer of their loan from Countrywide to the Bank of New York Mellon or the servicer Bank of America.” Id. ¶ 36. They claim that Defendant Bank of America is the current servicer on the loan. Id. ¶ 33. Additionally, they claim they have “attempted a series of attempts to get a loan modification, all of which were repeatedly delayed due to lost paperwork, claimed ‘incomplete' paperwork, and repeated re-assigned to new loan officers.” Id. ¶ 38.

         The Deforests^[1] allege that a forensic audit was performed on the property in 2016, revealing that there was a “break in the chain of title” and “there was no assignment of the Mortgage from America's Wholesale Lender (Countrywide) to Bank of New York Mellon, Bank of America, or any either trust or servicer.” Id. ¶ 12. They allege that the original lender - America's Wholesale Lender - was a fictitious entity “used to conceal the identity of the actual lender” and that the actual lender is unknown. Id. ¶ 15(a). They allege that this demonstrates that the “chain of title is clouded and defective.” Id. ¶ 15(b). Furthermore, they allege that “[a]t all times material hereto Defendants knew of America's Wholesale Lender's actions and participated in them” and that the Bank of America “was the successor in interest to America's Wholesale was responsible for the actions of Countrywide.” Id. ¶¶ 40-41

         B. Procedural History

         The DeForests filed the initial complaint pro se on September 7, 2017. The Complaint included twelve separate counts:

1. Count I alleges that Defendants “do not have an equitable right to foreclose on the Property because Defendants . . . have failed to perfect any security interest in the Real Property collateral” and that the “Deed of Trust is a nullity by operation of law.” Compl. ¶¶ 44-45. Additionally, Plaintiffs allege that “Defendant MERS Cannot be a Real Party in Interest in a Securitized Mortgage.” Compl. ¶¶ 46-56.

2. Count II alleges “fraud in the concealment” against the Bank of New York Mellon, alleging that the bank “concealed the fact that they were not a Federal Reserve Depository Bank.” Id. ¶¶ 57-67.

3. Count III alleges “fraud in the inducement” against all Defendants, claiming that “Defendants, intentionally misrepresented to Plaintiff those Defendants were entitled to exercise the power of sale provision contained in the Mortgage/Deed of Trust” and “misrepresented that they are the ‘holder and owner' of the Tangible Note . . . .” Id. ¶¶ 68-75.

4. Count IV appears to allege that loan documents were an “unconscionable contract.” Id. ¶¶ 76-83. Plaintiffs claim that the Bank of New York Mellon's actions “resulted in Plaintiff being forced, tricked, and mislead into parting with their property.” Id. ¶ 77.

5. Count V alleges breach of contract against Bank of New York Mellon. Id. ¶¶ 84-88.

6. Count VI alleges that Bank of New York Mellon “failed to disclose to Plaintiff that they were not the legitimate creditor, ” and was “acting not in the best interest of the grantor of the Mortgage/Deed of Trust” and therefore “failed to adhere to their Fiduciary Duties.” Id. ¶¶ 91, 94.

7. Count VII seeks to quiet title. Id. ¶¶ 95-101.

8. Count VIII alleges a “grave error Slander of Title causing special damage.” Id. ¶ 109.

9. Count IX seeks declaratory relief and Plaintiffs “request[] a judicial determination of the rights, obligations and interest of the parties with regard to the subject property” and “seek[] to quiet title . . . .” Id. ¶¶ 112-114.

10. Count X alleges violations of the Connecticut Homeowner's Protection Bill, Conn. Gen. Stat. § 49-31k et seq.

11. Count XI alleges violation of the Consumer Credit Protection Act, 15 U.S.C. § 1461, because Defendants failed to disclose the “purported assignments/transfer of the ...