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Archer v. America's First Federal Credit Union

United States District Court, S.D. Alabama, Southern Division

September 17, 2019




         This cause is before the Magistrate Judge for issuance of a report and recommendation, pursuant to 28 U.S.C. § 636(b)(1)(B) and S.D. Ala. GenLR 72(a)(2)(S), on Plaintiffs' second-amended complaint (see Doc. 7), Defendant America's First Federal Credit Union's (“AFFCU's”) motion to dismiss second-amended complaint (Doc. 15; see also Doc. 16 (AFFCU's evidentiary submission)), as supplemented (Doc. 19), Plaintiff's response in opposition, with attachments (Doc. 23), and AFFCU's reply (Doc. 24). Upon consideration of these pleadings, as well as other pleadings in the file (Doc. 20 (Plaintiffs' motion to recall writ of possession and brief); Doc. 22 (Defendant's response in opposition); Doc.25 (Plaintiffs' response to Defendant's response)), the Magistrate Judge RECOMMENDS that the Court GRANT AFFCU's motion to dismiss second-amended complaint (Doc. 15), as supplemented (Doc. 19), and DENY Plaintiffs' motion to recall writ of possession (Doc. 20).


         Plaintiff Lewis Archer initially filed a complaint against AFFCU in this Court on May 31, 2019. (Doc. 1). Following entry of an order instructing Plaintiff to file an amended complaint and an amended motion to proceed without prepayment of fees (or, alternatively, pay the $400.00 filing fee) (see Doc. 4), the Plaintiffs ultimately paid the filing fee (Doc. 6) and filed a second-amended complaint (Doc. 7) on July 2, 2019.[1]

         In the second-amended complaint, Plaintiffs specifically aver that this Court may exercise federal question jurisdiction, 28 U.S.C. § 1331, and that their claims are being brought pursuant to § 6(f) of the Real Estate Settlement Procedures Act (RESPA), 12 U.S.C. § 2605(f)(1)-(3), and 12 C.F.R. § 1024.41(a)[2]. (See Doc. 7, at 1-2). Plaintiffs set forth two counts in their complaint: Count 1 asserts AFFCU's violation of the dual-tracking provisions of 12 C.F.R. § 1024.41(f)(1)(i) by virtue of Defendant making a pre-foreclosure first notice of filing on July 11, 2014 without Plaintiffs' mortgage being 120 days late (Doc. 7, at 2) and Count 2 asserts AFFCU's violation of the dual-tracking provisions of 12 C.F.R. § 1024.41(i) “by requesting a duplicate second application in the beginning of October of 2014 after the Archer[]s had already gone through a thorough [a]pplication process with submitted tax returns at the beginning of June 2014.” (Doc. 7, at 4). The factual underpinnings of Plaintiffs' claim are set forth in the second-amended complaint and read, in relevant measure, as follows:

Lewis and Shearie Archer, husband and wife[, ] executed a note and mortgage, dated May 9, 2008, payable to AFFCU in the principal amount of $165, 000.00 secured by the following property:
Lot 1, Tara Estates as recorded in Map Book 20, Page 89, In the Probate Office of Mobile County, Alabama.
The street address of the property is: 9070 O'Hara Drive Mobile, Alabama 36695
The mortgage was recorded in the office of the Judge of Probate of Mobile County, Alabama, in Instrument Number 2008040886, Book 6333, Page 996, C. 38.
In early June of 2014, AFFCU sent the Archers [] to Hardest Hit Alabama to qualify for mortgage assistance help [] since [the] $1, 728 monthly payments were excessive due to Lewis Archer's decrease in income and Shearie Archer's health challenges.
Hardest hit Alabama[, ] in conjunction with AFFCU[, ] put the Archers through a thorough qualifying process that involved [the] submi[ssion] of tax returns. The Archers successfully qualified for $30, 000 maximum of approved help towards permanent modification. Since the Archers were qualified and approved, AFFCU was to fax a simple modification plan to 1(888)207-1439 for the $30, 000 to be sent and applied. []
On July 9th, 2014, AFFCU Branch Manager Jason Fuller met with Mr. Archer in his office with Assistant Vice President Mark Shadddix on the telephone. The Assistant Vice President confirmed to the Branch Manager and Mr. Archer that AFFCU did in fact accept the $30, 000 help. []
Since all were in agreement, the contents of the meeting were memorialized by Mr. Archer on the same day and emailed to the Assistant Vice President so it would be stamped dated. [] On July 11th, 2014, Collection Manager Sharon Richardson sent the Archers a Right to Cure letter towards foreclosure. [] Yet, the memorialized contents of the meeting were emailed again on July 14th[, ] 2014[, ] this time by the Branch Manager himself to the Assistant Vice President with no complaints, confusion or misunderstanding of plan participation. []
AFFCU simply reneged on the promise and did not fax to Hardest Hit Alabama the already written simple permanent modification plan to be funded by the available $30, 000. []
It became clear that AFFCU[, ] instead, stopped accepting payments on June 30th, 2014; [f]alsely sent notice on July 11th, 2014 that the Archer[]s were delinquent on the loan[;][3] and started a series of seven foreclosure attempts while taking the Archers through various modification exercises. [] Those two tracks ended 19 months later on January 29th[, ] 2016 with an official foreclosure and a letter ending modification efforts both on the same day. []
The dates of the seven foreclosure attempt letters while going through the modification processes are: 1. (September 5th, 2014)[, ] 2. (January 30th, 2015)[, ] 3. (May 28th, 2015)[, ] 4. (August 19th, 2015)[, ] 5. (November 20th, 2015)[, ] 6. (January 4th, 2016)[, and a]ctual foreclosure (January 29th, 2016). [] AFFCU published the Archer[]s[‘] home for foreclosure purposes at least thirteen times[] (Sept 10th, 2014[, ] Sept 17th, 2014[, ] Sept 24th, 2014, [, ] June 3rd, 2015[, ] June 10th, 2015[, ] June 17th, 2015[, ] August 26th, 2015[, ] Sept 2nd, 2015[, ] Sept 9th, 2015[, ] Dec 2nd, 2015[, ] Dec 9th, 2015[, ] Dec 16th, 2015[, ] Jan 10th, 2016.) []

(Id. at 5-7 (internal citations omitted; footnote added; emphasis in original)).[4]

         Although the operative pleading in this case (Doc. 7) concludes with the salient fact that the actual foreclosure took place on January 29, 2016 (see Id. at 7), [5] much more occurred after that date and up to May 31, 2019, the date Lewis Archer initially instituted this action in this Court (see Doc. 1).

         Based on the Archers' refusal to vacate the premises of 9070 O'Hara Drive, Mobile, Alabama 36695 following the foreclosure sale, a refusal which exists to this day (see, e.g., Doc. 25, at 3 (immediately inserted following the signature line on Plaintiffs' August 26, 2019 response to Defendant's response to Plaintiffs' motion to recall writ of possession is the address of 9070 O'Hara Drive, Mobile, AL 36695)), AFFCU instituted an ejectment action against the Archers, in accordance with § 6-6-280 of the Alabama Code, [6] in the Circuit Court of Mobile County, Alabama on April 11, 2016. (Doc. 16, Exhibit 1, COMPLAINT; see also id., Exhibit 9, at 1-2 (“[AFFCU] filed in the Mobile Circuit Court [] a complaint seeking to eject Lewis Archer and Shearie Archer from real property AFFCU had purchased at a January 29, 2016, foreclosure sale[.]”)). In an amended answer and counterclaim, filed January 10, 2017 in the state court action, the Archers asserted as a defense that the “foreclosure sale was conducted contrary to federal law including, but not limited to[, ] RESPA, 12 USC §2600, et[] al.[, ] and is, therefore, void and of no legal effect[, ]” (Doc. 16, Exhibit 2, at 2) and counterclaimed for breach of mortgage contract and declaratory judgment (id. at 2-3). Additionally, in a January 24, 2018 response to AFFCU's renewed motion for summary judgment, the Archers argued that AFFCU had no ownership interest in the subject property or any right to pursue ejectment based upon the following:

1. [AFFCU] is prohibited by Federal Law from proceeding with foreclosure if an application to ...

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