United States District Court, D. New Hampshire
McCafferty United States District Judge.
Investments, LLC brings suit against Deutsche Bank National
Trust Company, after Deutsche Bank terminated their real
estate purchase agreement. Avarden alleges that Deutsche Bank
wrongfully terminated the agreement on the eve of the
closing. Deutsche Bank moves to dismiss the lawsuit, arguing
that the parties' agreement expressly permits the
termination and limits Avarden's relief to the return of
its security deposit, which both parties agree Deutsche Bank
returned to Avarden shortly following the termination.
has also moved to amend its complaint. Deutsche Bank objects,
arguing that the proposed amended complaint is futile for the
same reasons presented in its motion to dismiss.
proceeding pro se, brought suit in state court against
Deutsche Bank, alleging claims for breach of contract, breach
of the implied covenant of good faith and fair dealing,
violation of New Hampshire's Consumer Protection Act, and
fraud. Deutsche Bank removed the suit to this court and moved
to dismiss Avarden's suit for failure to state a claim.
Avarden then obtained counsel and through that counsel filed
an objection to Deutsche Bank's motion to dismiss.
Avarden's objection also requested the opportunity to
amend its complaint.
procedural order, the court granted Avarden leave to move to
amend its complaint and held Deutsche Bank's motion to
dismiss in abeyance, pending the outcome of Avarden's
anticipated motion to amend. Doc. no. 17. In its
order, the court observed that Avarden's request to amend
was procedurally improper under the local rules of this
district. The court recognized the request, however, based on
equitable factors, including that Avarden was pro se when it
filed its complaint. The court also required that
“Avarden's motion to amend shall comply with the
local rules of this district.” Doc. no. 17 at
2016, Avarden moved to amend its complaint. Doc. no.
18. The proposed amended complaint, which Avarden
has filed with its motion, asserts the same claims as those
contained in Avarden's original complaint. Deutsche Bank
objected to the motion to amend, and Avarden filed a reply to
Motion to Amend
moves to amend its complaint to include “specific
details and the particular circumstances constituting the
fraud claim.” Doc. no. 18. Deutsche Bank
objects. In support, Deutsche Bank contends that
Avarden's motion is futile and does not comply with the
local rules of this district.
response to a motion to amend a complaint, “[t]he court
should freely give leave when justice so requires.”
Fed. R. Civ. P. 15(a)(2). To decide if justice
requires leave to amend, the court considers all of the
circumstances to “balance  pertinent
considerations.” Palmer v. Champion Mortg.,
465 F.3d 24, 30-31 (1st Cir. 2006). Generally, the motion
should be allowed in the absence of “any apparent or
declared reason-such as undue delay, bad faith or dilatory
motive on the part of the movant, repeated failure to cure
deficiencies by amendments previously allowed, undue
prejudice to the opposing party by virtue of allowance of the
amendment, [or] futility of amendment.” Foman v.
Davis, 371 U.S. 178, 182 (1962).
amendment is futile if it cannot survive the standard
applicable to motions to dismiss under Federal Rule of
Civil Procedure 12(b)(6). Platten v. HG Bermuda
Exempted Ltd., 437 F.3d 118, 132 (1st Cir. 2006). In
considering a motion under Rule 12(b)(6), the court assumes
the truth of the properly pleaded facts and takes all
reasonable inferences from the facts that support the
plaintiff's claims. Mulero-Carrillo v.
Roman-Hernandez, 790 F.3d 99, 104 (1st Cir. 2015). Based
on the properly pleaded facts, the court determines whether
the plaintiff has stated “a claim to relief that is
plausible on its face.” Bell Atl. Corp. v.
Twombly, 550 U.S. 544, 570 (2007).
Bilc is the former resident and mortgagor of a property
located at 95 Jenkins Road in Bedford, New Hampshire
(“the property”). In May 2011, Deutsche Bank, who
had acquired the mortgage, foreclosed on the property.
Deutsche Bank then recorded a foreclosure deed on the
property. About two years after recording that deed, Deutsche
Bank offered the property for sale at auction.
auction, Avarden made the successful bid. Deutsche Bank and
Avarden then entered into a purchase agreement governing the
sale of the property. Bilc, serving as Avarden's manager,
signed the purchase agreement on Avarden's behalf on July
1. Doc. no. 5-3 at 24. On July 24, JP Morgan Chase
Bank, acting as Deutsche Bank's attorney-in-fact,
executed the purchase agreement and delivered the executed
agreement to Avarden. Avarden alleges that before the
execution of the purchase agreement it disclosed to Deutsche
Bank that it had agreed to lease the property to Bilc and
that Deutsche Bank approved this disclosure in mid-July.
purchase agreement set the closing date for the sale as July
31, 2014. In addition, pursuant to the purchase agreement,
Avarden was required to pay a $13, 500 earnest money deposit,
which it did.
purchase agreement contains three provisions that are central
to the parties' dispute. First, the cover page of the
purchase agreement contains a provision limiting
Avarden's remedy to the return of its deposit in the
event of a Deutsche Bank breach or default before the
sale's closing. That provision provides, in pertinent
NOTWITHSTANDING ANY PROVISION TO THE CONTRARY IN THIS
AGREEMENT, SELLER'S LIABILITY AND BUYER'S SOLE AND
EXCLUSIVE REMEDY IN ALL CIRCUMSTANCES AND FOR ALL CLAIMS (AS
THE TERM IS DEFINED IN SECTION 9 OF THIS AGRREEMENT . . .) .
. . ARISING OUT OF OR RELATING IN ANY WAY TO THIS AGREEMENT
OR THE SALE OF THE PROPERTY TO BUYER, INCLUDING . . .
SELLER'S BREACH OR TERMINATION OF THIS AGREEMENT . . .
SHALL BE LIMITED TO NO MORE THAN . . . A RETURN OF
BUYER'S EARNEST MONEY DEPOSIT IF THE SALE TO BUYER DOES
NOT CLOSE . . . .
Doc. no. 5-3 at 1. Second, the next page of the
purchase agreement contains a provision in which Avarden
agreed to “waive. . . all rights to file and maintain
an action against the seller for specific performance.”
Id. at 2.
Avarden and Deutsche Bank also executed a “seller's
auction addendum” to the purchase agreement.
Id. at 28. That addendum contains a termination
option granting Deutsche Bank the power to terminate the
purchase agreement under certain enumerated circumstances.
One of the circumstances in which Deutsche Bank can terminate
the agreement is if the buyer is the former mortgagor or is
affiliated with the former mortgagor. The termination option
provides, in pertinent part, that Deutsche Bank has:
the right, in its sole discretion, to . . . terminate the
Agreement if . . . Buyer is the former mortgagor of the
Property whose interest was foreclosed . . . or is related to
or affiliated in any way with the former mortgagor, and Buyer
has not disclosed this fact to Seller in writing ...