United States District Court, N.D. Alabama, Southern Division
ANNEMARIE CARNEY AXON UNITED STATES DISTRICT JUDGE.
the court is Defendants Loancare, LLC, and Lakeview Loan
Servicing, LLC's unopposed motion to dismiss the
complaint. (Doc. 4).
Thomas Blake Liveoak alleges that, after he fell behind on
his mortgage payments, Defendants made it difficult for him
to seek loss mitigation options and disregarded the loss
mitigation package he eventually submitted. In this lawsuit
he asserts that they are liable for (1) negligent
hiring/supervision/training (“Count One”); (2)
misrepresentation/innocent fraud (“Count Two”);
(3) fraudulent suppression (“Count Three”); and
(4) negligence (“Count Four”). (Doc. 1-5 at 7-
have moved to dismiss the complaint. (Doc. 4). Because Mr.
Liveoak's negligence claims arise out of a contractual
duty, the court WILL GRANT the motion to
dismiss Counts One and Four and WILL DISMISS
those claims WITHOUT PREJUDICE. And because
Mr. Liveoak has not pleaded his fraud-based claims with
particularity, as required by Federal Rule of Civil Procedure
9(b), the court WILL GRANT the motion to
dismiss Counts Two and Three and WILL
DISMISS those claims WITHOUT
stage, the court must accept as true the factual allegations
in the complaint and construe them in the light most
favorable to the plaintiff. Butler v. Sheriff of Palm
Beach Cty., 685 F.3d 1261, 1265 (11th Cir. 2012).
Liveoak alleges that he owns a property in Vestavia Hills,
Alabama, the purchase of which he financed with a mortgage.
(Doc. 1-5 at 7 ¶¶ 1-2). He recently fell behind on
his mortgage payments and contacted Loancare and Lakeview
Loan Servicing to seek assistance paying his mortgage.
(Id. at 7 ¶ 6). Mr. Liveoak states that
“the mortgage was not with Defendants LoanCare, LLC and
Lakeview Loan Servicing, LLC” (id. at 7 ¶
3), but it appears that Defendants were the mortgage
servicers (see generally Id. at 7-8 ¶¶
6-8). Defendants made it difficult to seek assistance, but
told him that they would offer him a forbearance plan, that
they did not intend to foreclose on the home, that they would
review a “Loss Modification Package” if he
submitted one, and that they would offer him assistance to
retain his home. (Doc. 1-5 at 7-8 ¶ 6, 9 ¶ 16).
Eventually Mr. Liveoak was able to contact Defendants'
Loss Mitigation Department, which provided Mr. Liveoak with a
loss mitigation package. (Id. at 7-8 ¶ 6-7). He
completed the package and submitted it, but Defendants have
never reviewed it or responded to it. (Id. at 8
survive a motion to dismiss, the plaintiff must plead
‘a claim to relief that is plausible on its
face.'” Butler, 685 F.3d at 1265 (quoting
Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555
(2007)). “A claim has facial plausibility when the
plaintiff pleads factual content that allows the court to
draw the reasonable inference that the defendant is liable
for the misconduct alleged.” Ashcroft v.
Iqbal, 556 U.S. 662, 678 (2009).
Count One (Negligent Hiring/Supervision/Training) and Count
Count One, Mr. Liveoak alleges that Defendants negligently
supervised, inspected, hired, trained, instructed, or
educated its employees, agents, and affiliates, apparently
based on the difficulty he experienced when he contacted
Defendants to seek assistance in making mortgage payments.
(Doc. 1-5 at 8 ¶ 11). In Count Four, he alleges that
Defendants were negligent, without offering any facts in
support of that allegation. (Id. at 10 ¶¶
seek dismissal of the negligence claims on the bases that (1)
these claims arise out of a contractual relationship and
therefore cannot support a tort-based cause of action; (2)
mortgage servicers cannot be held liable for economic losses;
and (3) Alabama law does not recognize a claim for negligent
mortgage servicing. (Doc. 5 at 3-9).
law does not recognize claims of negligence arising out of
breach of contractual duties. See U.S. Bank Ass'n v.
Shepherd, 202 So.3d 302, 314 (Ala. 2015); see also
Vines v. Crescent Transit Co., 85 So.2d 436, 440 (Ala.
1956) (“[A] negligent failure to perform a contract . .
. is but a breach of the contract.”). Based on that
general rule, the Alabama Supreme Court has held that no
cause of action for negligent servicing of a mortgage is
available under Alabama law. Id. at 314-15. And a
number of federal courts have found that because Alabama law
does not provide for negligent servicing of a mortgage, a
plaintiff cannot assert a claim for negligent hiring,
supervision, or training arising out of negligent servicing
of a mortgage. See James v. Nationstar Mortg., LLC,
92 F.Supp.3d 1190, 1200-01 (S.D. Ala. 2015); Costine v.
BAC Home Loans, 946 F.Supp.2d 1224, 1235 (N.D. Ala.
2013); Tidmore v. Bank of Am., N.A., no.
4:15-cv-2210-JEO, 2017 WL 467473, at *4-6 (N.D. Ala. Feb. 3,
holdings foreclose Mr. Liveoak's claims of negligence
against Defendants. Although his factual allegations are
sparse, even construed in the light most favorable to him the
negligence claims arise out of the contractual obligations
made in the mortgage. Accordingly, he cannot assert tort
claims for ...