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Roundpoint Mortgage Servicing Corp. v. Hubert-Toussaint

Superior Court of Delaware

September 26, 2019

ROUNDPOINT MORTGAGE SERVICING CORPORATION, Plaintiff,
v.
NATHALIE HUBERT-TOUSSAINT and LAVERNE M. REEDER, Defendant.

         Plaintiffs Motion to Dismiss Defendants' Counterclaim Granted.

          Catherine DiLorenzo, Esquire of Alba Law Group, Wilmington, Delaware and Adam V. Orlacchio, Esquire of Blank Rome LLP, Wilmington, Delaware; co-counsel for Plaintiff.

          Nathalie Hubert-Toussaint and Laverne M. Reeder, Smyrna, Delaware; pro se Defendants.

          ORDER

          William L. Witham. Jr. Resident Judge.

         Presently before the Court is Plaintiff, RoundPoint Mortgage Servicing Corporation's (hereinafter "RoundPoint") Motion to Dismiss Defendants' Counterclaim pursuant to Rule 12(b)(6) of the Delaware Superior Court Rules of Civil Procedure.[1] After considering Plaintiffs motion, Defendants' response in opposition, and the record, it appears to the Court that:

         1. On December 31, 2015, Defendants, Nathalie Hubert-Toussaint and Laverne M. Reeder, executed and delivered a promissory note (the "Note") in favor of Primelending, a PlainsCapital Company ("Primelending"), to obtain a mortgage loan in the amount of $410, 000.00 (the "Loan").[2] To secure the Loan, Defendants delivered a mortgage (the "Mortgage") to Mortgage Electronic Registration System (MERS) as nominee for Primelending, and the Mortgage was recorded with the Kent County Recorder of Deeds.[3] On June 30, 2017, MERS assigned the Mortgage to RoundPoint, which was also recorded on July 5, 2017 with the Kent County Recorder of Deeds.[4]

         2. On July 1, 2018, Defendants defaulted on the Note and the Mortgage by failing to make required monthly payments, and they have made no payments since.[5]On March 11, 2019, RoundPoint commenced foreclosure proceedings by filing the foreclosure Complaint.[6]

         3. On April 30, 2019, Defendants filed an Answer to the Complaint for Foreclosure of Mortgage, Affirmative Defense and Counterclaim (the "Counterclaim").[7] Pursuant to Rule 12(b)(6) of the Delaware Superior Court Rules of Civil Procedure, RoundPoint filed a Motion to Dismiss the Counterclaim.[8]

         4. Defendants contend that they have entered into a new agreement with RoundPoint by sending RoundPoint what they call a "Conditional Acceptance for Value and Counter Offer of Claim for Proof of Claim and Tender of Payment Offering" ("Counteroffer").[9] Because RoundPoint failed to respond in any way to the Counteroffer, RoundPoint entered into a binding contract with Ms. Hubert-Toussaint and Mr. Reeder, Defendants claim.[10] As a part of this new agreement, RoundPoint had to accept Defendants' "Equitable Remittance Coupon" (the "Coupon") for $450, 000.00, according to Defendants.[11] Because RoundPoint failed to accept it and discharge all of Defendants' prior obligations under the Note, Defendants claim RoundPoint owes them $1, 200, 000.00 in damages.[12] Further, Defendants argue that any disputes related to this new "agreement" must be done through the Arbitration Association.[13]

         5. On a motion to dismiss pursuant to Rule 12(b)(6), the moving party bears the burden of demonstrating that "under no set of facts which could be proven in support of its [complaint] would the [plaintiff] be entitled to relief."[14] Upon this Court's review of a motion to dismiss, "(I) all well-pleaded factual allegations are accepted as true; (ii) even vague allegations are well-pleaded if they give the opposing party notice of the claim; (iii) the Court must draw all reasonable inferences in favor of the non-moving party; and (iv) dismissal is inappropriate unless the plaintiff would not be entitled to recover under any reasonably conceivable set of circumstances susceptible of proof."[15]

         6. In sum, Defendants state no viable claim for relief. It appears to the Court that the allegations in the Defendants' Counterclaim, as well as in the Reply to the Plaintiffs Motion to Dismiss, are without merit. Furthermore, Defendants could be sanctioned by the Court because their Counterclaim appears to be frivolous, and it is a waste of the Court's resources. It should be noted that Defendants continue restating their claims in two separate filings using what seems to be intentionally misleading and confusing language filled with meaningless legalese.

         7. Defendants' claim appears to be based on the "vapor money" theory.[16] The theory is related to Public Law 73-10, enacted H.J. Res. 192, 73rd Cong. (1933) (the "House Joint Resolution 192") to ensure uniform value to the coins and currencies of the United States.[17] House Joint resolution 192 states that obligations requiring payment in gold or a particular kind of coin or currency are against public policy, and that U.S. currency is legal for all debts.[18]

         8. Borrowers, in utilizing this theory, have initiated lawsuits attempting to invalidate debts or argue the debts have been repaid based on theories originating from the suspension of the gold standard.[19] One of these theories is a "vapor money" theory, which borrowers use to argue that a promissory note is the equivalent to cash.[20] According to this theory, the bank deposits such notes into its own account, lists them as assets on the ledger, and lends it back to individuals.[21] Through bookkeeping procedures, the bank supposedly "creates" money.[22] Courts across the country have rejected this theory.[23]

         9. In this case, Defendants claim that they repaid their mortgage balance with a coupon that was the equivalent to cash. Because the coupon was not a valid form of payment, Defendants never repaid their mortgage ...


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