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Hudson v. Bank of America, N.A.

Superior Court of Delaware, Kent

September 16, 2014

DONALD R. HUDSON, SR., Plaintiff,
v.
BANK OF AMERICA, N.A., and QUEEN'S PARK OVAL ASSET HOLDING TRUST, Defendants.

Submitted: August 6, 2014

Upon Consideration of Defendant’s Motion to Dismiss DENIED IN PART and GRANTED IN PART

Theodore A. Kittila, Esquire, Greenhill Law Group, LLC, Wilmington, Delaware for Plaintiff. Joseph M. Grieco, Esquire, Reed Smith LLP, Wilmington, Delaware for Defendant Bank of America, N.A.

Daniel T. Conway, Esquire, Atlantic Law Group, LLC, Georgetown, Delaware for Defendant Queen's Park Oval Asset Holding Trust.

ORDER

Robert B. Young J.

SUMMARY

Donald R. Hudson ("Plaintiff") filed a Complaint against Bank Of America, N.A. ("Defendant") alleging five causes of action, arising out of Defendant's failure to accept Plaintiff's purported tender of payment in satisfaction of a mortgage and note securing the mortgage, held by Defendant. By its motion, Defendant seeks to dismiss all of the claims in Plaintiff's Complaint for 1) failure to state a claim for which relief can be granted pursuant to Superior Court Civil Rule 12(b)(6); and 2) failure to join an indispensable party pursuant to Rule 12(b)(7). In addition, Defendant requests that Plaintiff's claim for injunctive relief be brought instead in its previously filed foreclosure action against Defendant, currently dormant before this Court.

With respect to Defendant's motion to dismiss pursuant to 12(b)(6), the crux of the disputes centers upon whether Plaintiff's purported tender was in fact a tender. The Court is satisfied that Plaintiff has plead facts sufficient to support a reasonable interpretation that the alleged tender was indeed a true tender. Defendant's motion to dismiss for failure to state a claim is, thus, DENIED.

Both parties have provided insufficient support for their positions concerning Defendant's motion to dismiss pursuant to Rule 12(b)(7). If the parties desire to pursue this complex issue at this early stage, they are to provide thorough briefing regarding it.

Finally, this Court follows settled Delaware case law in dismissing Plaintiff's claim for injunctive relief as it should properly be brought in the pending foreclosure action. The Defendant's motion with respect to Plaintiff's claim for injunctive relief is, therefore, GRANTED.

FACTS AND PROCEDURE

Plaintiff and his former wife Carmen Y. Goldsboro-Hudson (not a party to this action) acquired a residential property located at 121 Thornhill Court, Dover, Delaware ("Thornhill Court Property") on December 3, 1998. This acquisition was financed by a mortgage loan obtained by Plaintiff and his former wife as co-mortgagors. The former couple also executed a deed on the Thornhill Court Prop erty. On August 31, 2004, following Goldsboro-Hudson's legal change of name from "Carmen Y. Hudson" to "Carmen Y. Goldsboro-Hudson, " the then-married couple executed a new deed on the property to reflect this life event.

In 2008, the then-couple required refinancing of their residential property. On May 2, 2008, both Plaintiff and Goldsboro-Hudson executed a promissory note ("Original Note") in the amount of $281, 155.00 and a mortgage ("the Mortgage") securing the note. The Original Note was made in favor of Taylor, Bean & Whitaker Mortgage Corp. ("Taylor Bean"). The Mortgage lists Mortgage Electronic Registration System, Inc. ("MERS") as the mortgagee, acting as a nominee for Taylor Bean, "its successor and assigns."

Although this is a point of contention between the parties, it appears MERS assigned or at least attempted to assign its beneficial interest under the Mortgage to Defendant, as is evidenced in an Assignment of Mortgage dated September 29, 2011.

Prior to the assignment, in October 2010, Plaintiff and Goldsboro-Hudson divorced. Subsequently, on March 22, 2012, Goldsboro-Hudson by way of quit-claim deed, transferred her interest in the Thornhill Court Property to Plaintiff. Following this transfer, Goldsboro-Hudson filled for Chapter 7 bankruptcy on March 29, 2012, in the U.S. Bankruptcy Court for the District of Delaware.[1] She was granted a discharge pursuant to 11 U.S.C. § 727 on July 24, 2012.

On December 20, 2013, Defendant Bank of America filed a foreclosure action against Hudson and Goldsboro-Hudson in the Superior Court of Delaware in and for Kent County.[2] Accompanying documents listed the total amount owed as of November 18, 2013 as $286, 052.43. At present, the action is dormant.

Although there is some dispute as to the exact date of the correspondence, Plaintiff through his counsel Knight & Mitchell, P.C. ("K&M"), sent a letter entitled "Tender of Payment & Release of Security" ("Tender Letter") to Defendant Bank of America on or about February 28, 2014.[3] Enclosed with the Tender Letter was a copy of a certified cashier's check from Plaintiff, made out to Bank of America in the amount of $292, 984.53.[4] The Tender Letter demanded that the Mortgage be released, pursuant to its contractual terms, and that the Original Note be returned to Plaintiff. The parties are in disagreement as to conditionality of the Tender Letter's language, which provides that Bank of America had until March 10, 2014 "to produce the original promissory Note for collection, at which time, in exchange for the original Note, all settled proceeds will be presented to the party entitled to enforce or collect payment." It is undisputed that Defendant never responded to Plaintiff's correspondence.

Instead, on March 11, 2014, Defendant notified Plaintiff by letter, that the servicing of the mortgage was transferred to Specialized Loan Servicing, LLC ("SLS"); and that, going forward, any payments should be made to SLS. The letter specifically made clear that Defendant would not be accepting any further payments. The parties disagree as to whether the transfer described in the letter ever occurred. There is further confusion as to the role Queen's Park Oval Asset Holding Trust ("Queen's") plays in this dispute. Apparently, following the transfer to SLS, there was a subsequent transfer of the mortgage to Queen's.[5]

On May 29, 2014, Plaintiff filed a Complaint against Defendant with this Court, alleging five causes of action arising out of Defendant's refusal to accept or act upon the Tender Letter: (1) seeking a declaration that the mortgage is discharged; (2) seeking a declaration as to the discharge of purported debt; (3) seeking declaration as to the lawfulness of foreclosure action and/or requesting injunctive ...


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