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Dionne v. Federal National Mortgage Association

United States District Court, D. New Hampshire

June 16, 2015

Jason S. Dionne and Denise C. Dionne,
v.
Federal National Mortgage Association and JPMorgan Chase Bank, N.A Opinion No. 2015 DNH 125

ORDER

LANDYA McCAFFERTY, District Judge.

This mortgage foreclosure dispute was removed to this court from the Hillsborough County Superior Court by the defendants, Federal National Mortgage Association ("FNMA") and JPMorgan Chase Bank, N.A. (individually "Chase, " and collectively with FNMA, the "Defendants"). Previously, the Defendants moved to dismiss the case for failure to state a claim pursuant to Federal Rule of Civil Procedure 12(b)(6). In an order dated April 23, 2015, this court denied the Defendants' motion to dismiss without prejudice, and granted plaintiffs Jason and Denise Dionne an opportunity to file an amended complaint. The Defendants subsequently filed a motion for reconsideration of the April 23 order, contending that the court had erred in granting the Dionnes leave to amend their complaint. The Defendants urge the court not to consider an amended complaint, and instead to rule on the motion to dismiss.

For reasons that will be explained below, the Defendants' motion for reconsideration is GRANTED. Although the Dionnes did file an amended complaint, the court will disregard the amended version, and will instead treat the initial complaint as the operative pleading for purposes of the motion to dismiss.

Unf the Defendants, today's victory will likely ring hollow. While they have prevailed on the court to reconsider its April 23 order and to rule on the motion to dismiss, for the reasons that follow, the court concludes that the Defendants' motion to dismiss should be DENIED.

Background[1]

The Dionne family has lived at the subject property, located in Pelham, New Hampshire, since 1976. Verified Petition ¶ 12. Pursuant to a 2006 loan agreement, the Defendants held a mortgage on the property at the time that these events occurred.[2]

On August 12, 2014, Ms. Dionne received a letter from Chase indicating that a foreclosure sale of the property had been "rescheduled" for October 1, 2014.[3] Id . ¶ 15; see also Ex. 1 to Verified Petition. Immediately thereafter, the Dionnes applied for a loan modification, and Chase acknowledged receipt of the application by letter dated August 27, 2014. Id . ¶ 16; see also Ex. 2 to Verified Petition. For reasons that are unclear, the October 1 foreclosure sale did not take place. Id . ¶ 17.

In October and November of 2014, the Dionnes submitted all of the paperwork that Chase requested in connection with the loan modification, but were repeatedly told that Chase had not received certain materials. Id . ¶¶ 18-21; see also Exs. 3, 4 to Verified Petition. On November 18, 2014, before a decision was reached on the loan modification, the Dionnes received a letter indicating that the Defendants had authorized another foreclosure sale. Id . ¶¶ 22-23; see also Ex. 5 to Verified Petition. The Dionnes contacted Chase, and were assured that no sale would occur during the pendency of the application. Id . ¶ 23.

Several weeks later, on December 11, 2014, the Dionnes received another letter indicating that a foreclosure sale had been scheduled for January 12, 2015. Id . ¶ 24; see also Ex. 6 to Verified Petition. The Dionnes contacted Chase on January 10, 2015, and were again assured that the loan modification application was being considered and that a foreclosure sale would not occur until that process was complete. Id . ¶ 25. Nevertheless, the foreclosure sale took place as scheduled on January 12, and the property was apparently sold to a third party. Id . ¶ 26; see also Ex. 7 to Verified Petition.

The Dionnes filed the Verified Petition in the Hillsborough County Superior Court shortly after the foreclosure sale. The Dionnes allege that they had relied to their detriment on Chase's promises that the Defendants would not foreclose during the pendency of the loan modification application, and they allege that the Defendants violated federal consumer protection law by foreclosing on the property during that pendency period. After the Superior Court granted an ex parte preliminary injunction barring the recording of the foreclosure deed, the Defendants removed the proceedings to this court, and now move to dismiss the Verified Petition.

In their objection to the motion to dismiss, the Dionnes state:

Defendants' argument for dismissal is premature inasmuch as no complaint is presently before the court. Plaintiffs' pleading in issue was filed in state court as an ex parte preliminary injunction seeking temporary relief pending [a] hearing on the merits of the ex parte hearing. Said pleading was not accompanied by a separate complaint at the time, but its filing was contingent on the outcome of the hearing on the merits of the ex parte hearing.... Plaintiffs hereby move that their ex parte motion be further allowed pending the filing of a complaint to preserve the status quo until the court issues a decision on the merits of the action.

See Pls.' Objection to Defs.' Mot. to Dismiss (doc. no. 6) ¶¶ 1-2. Though it was not overtly phrased as such, the court construed this language as a request by the Dionnes for leave to amend the Verified Petition. By order dated April 23, 2015, the court denied the Defendants' motion to dismiss without prejudice, and granted the Dionnes leave to amend the Verified Petition. The ...


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