Neenan v . CitiMortgage 13-CV-435-JD 11/26/13 UNITED STATES DISTRICT COURT FOR THE DISTRICT OF NEW HAMPSHIRE

Deborah A . Neenan

v. Civil N o . 13-cv-435-JD Opinion N o .

CitiMortgage, Inc.

O R D E R

After her home was sold in a foreclosure sale on August 2 7 , 2013, Deborah A . Neenan filed an emergency ex parte petition for a temporary restraining order and a verified complaint against CitiMortgage, Inc. in state court. On September 2 6 , 2013, the state court granted, in part, the petition for a temporary restraining order to maintain the status quo pending a preliminary hearing to be held within ten days. 1 CitiMortgage removed the case to this court on October 1 , 2013.

CitiMortgage now moves to dismiss Neenan’s claims. Neenan objects to the motion to dismiss and also moves to remand the case to state court for lack of subject matter jurisdiction. CitiMortgage has filed a reply to Neenan’s objection and objects to Neenan’s motion to remand.

1 The temporary restraining order expired no later than October 7 , 2013. See N.H. Super. C t . R. 161(a) (now N.H. Super. C t . R. 4 8 ) . I. Motion to Remand

Neenan contends that this court lacks subject matter

jurisdiction under

because her claims do not

meet the amount in controversy requirement.2 Subject matter

jurisdiction under § 1332 requires complete diversity between the

parties and an amount in controversy that exceeds $75,000.

§ 1332(a). When subject matter jurisdiction is challenged

following removal from state court, the removing party bears the

burden to show that federal jurisdiction exists. Ortiz-Bonilla

v . Fed’n de Ajedrez de P.R., Inc., --- F.3d ---,

(1st Cir. Aug. 2 1 , 2013). Therefore, while diversity of

citizenship is not challenged here, CitiMortgage must show that

the amount in controversy exceeds $75,000.

In support of the notice of removal, CitiMortgage asserted

that the jurisdictional amount was met because the fair market

value of the foreclosed property exceeded $75,000. Neenan

contends that her claims do not challenge the validity of the

foreclosure but instead seek damages for CitiMortgage’s conduct

2 As a fall-back argument, Neenan also suggests that the court should abstain from deciding her claims because they raise a state law policy issue pertaining to “self-help eviction.” In support, Neenan simply cites a 1946 Fifth Circuit case and a 1980 case from the Eastern District of Wisconsin. Neither case supports abstention here. Further, Neenan did not allege a claim challenging “self-help eviction.”

2 after the foreclosure. For that reason, she contends, the fair

market value of the property is not pertinent to the amount in

controversy.

Neenan alleges claims in her complaint as follows: Count I ,

Willful, Criminal Trespass; Count I I , Theft of Utility Services

(RSA 539:7); Count I I I , Unfair & Deceptive Trade Practices (RSA

Chapter 358-A); Count IV, Wrongful Eviction: Violation of RSA

540-A:2 and 3 ; Count V , Conversion; Count V I , Intentional

Infliction of Emotional Distress; and Count V I I , Negligent

Infliction of Emotional Distress. She seeks injunctive relief to

prohibit CitiMortgage from “continuing to deprive the Plaintiff

of lawful possession of her real property,” “from entering onto

or into the Premises,” and to enjoin CitiMortgage from recording

the foreclosure deed. Neenan also asks for “immediate and

interim damages” of $25,000 and reserves the right to seek

additional damages.

In support of diversity jurisdiction, CitiMortgage notes

that in addition to damages, Neenan seeks injunctive relief that

would deprive CitiMortgage of ownership of the property. For

that reason, CitiMortgage contends, the value of the property is

part of the measure of the amount in controversy. Neenan focuses

exclusively on the damages she seeks.

3 “‘Courts have repeatedly held that the value of the matter in controversy is measured not by the monetary judgment which the plaintiff may recover but by the judgment’s pecuniary consequences to those involved in the litigation.’” Barbosa v . Wells Fargo Bank, N.A.,

, at *4 (D. Mass. Aug. 1 3 , 2013) (quoting Richard C . Young & Co., Ltd. v . Leventhal,

, 3 (1st Cir. 2004) and citing 14A Charles Alan Wright, et a l . , Federal Practice & Procedure § 3702.5 (4th ed. 2011)). When the plaintiffs challenge the right or title to the property following a foreclosure sale, the appropriate measure of the amount in controversy includes the value of the property in question. Id.; see also Bedard v . MERS, Inc.,

, at *3 (D.N.H. May 1 1 , 2011).

As is noted above, CitiMortgage bears the burden of showing that the amount in controversy, including the value of the property, exceeds $75,000. Barbosa,

, at * 4 . CitiMortgage has demonstrated that it bought the property at issue in this case at the foreclosure sale on August 2 7 , 2013, for $220,848.68. Therefore, the amount in controversy exceeds $75,000. Federal subject matter jurisdiction exists under § 1332. The motion to remand is denied.

4 II. Motion to Dismiss

CitiMortgage argues that Neenan’s claims are barred because

she did not seek to enjoin the foreclosure before it occurred.

See RSA 479:25,II. CitiMortgage also argues that even if

Neenan’s claims are not barred by the requirements of RSA

479:25,II, they should be barred because she unreasonably delayed

filing this action. Further, CitiMortgage contends that the

claims fail on the merits as a matter of law.

A. Standard of Review

Federal Rule of Civil Procedure 12(b)(6) allows a defendant to move to dismiss on the ground that the plaintiff’s complaint fails to state a claim on which relief can be granted. In assessing a complaint for purposes of a motion to dismiss, the court “separate[s] the factual allegations from the conclusory statements in order to analyze whether the former, if taken as true, set forth a plausible, not merely conceivable, case for relief.” Juarez v . Select Portfolio Servicing, Inc.,

(1st Cir. 2013) (internal quotation marks omitted). “If the facts alleged in [the complaint] allow the court to draw the reasonable inference that the defendants are liable for the misconduct alleged, the claim has facial plausibility.”

(internal quotation marks omitted).

5 B. RSA 479:25,II

Any action or right of action of a mortgagor to challenge

the validity of a foreclosure is barred unless the mortgagor

instituted a petition to enjoin the foreclosure sale before it

occurred. RSA 479:25,II. RSA 479:25,II, therefore, “bars any

action based on facts which the mortgagor knew or should have

known soon enough to reasonably permit the filing of a petition

prior to the sale.” Murphy v . Fin. Dev. Corp.,

(1985). CitiMortgage contends that Neenan’s claims are barred

because she did not institute a petition to enjoin the

foreclosure sale before it occurred.

Neenan did not address the bar under RSA 479:25,II in her

complaint or in her objection to CitiMortgage’s motion to

dismiss.

Because Neenan did not file a petition to challenge the foreclosure sale before it occurred, she is barred from

challenging the validity of the foreclosure sale. See Magoon v .

Fed. Nat’l Mortg. Ass’n,

, at *1 (D.N.H. Aug. 6,

2013). As a result, to the extent Neenan’s claims are based on a

theory that the foreclosure sale is invalid, regardless of the

stated cause of action, they must be dismissed.

6 C. Claims

Neenan’s claims are Count I , Willful, Criminal Trespass;

Count I I , Theft of Utility Services (RSA 539:7); Count I I I ,

Unfair & Deceptive Trade Practices (RSA Ch. 358-A); Count IV,

Wrongful Eviction: Violation of RSA 540-A:2 and 3 ; Count V ,

Conversion; Count V I , Intentional Infliction of Emotional

Distress; and Count V I I , Negligent Infliction of Emotional

Distress. In response to CitiMortgage’s motion to dismiss,

Neenan asserts that CitiMortgage should be treated as a landlord

and with her as a tenant of the property sold at the foreclosure

sale, that CitiMortgage improperly evicted her from the property,

that the foreclosure sale is not complete, that CitiMortgage

stole her property, and that CitiMortgage misinterpreted her

misrepresentation claims.

1. Criminal Trespass, Theft of Utility Services - Counts I

and II

Criminal trespass is governed by RSA 635:2,I, and theft of utility services is governed by RSA 539:7. CitiMortgage asserts, and Neenan does not dispute, that no private cause of action exists under those statutes. See, e.g., Snierson v . Scruton,

3 , 79 (2000); Marquay v . Eno,

0 8 , 715-16 (1995). Therefore, Counts I and II are dismissed.

7 2. Violation of RSA 358-A - Count III

Neenan alleges that CitiMortgage violated New Hampshire’s

Consumer Protection Act, RSA 358-A, because “[t]he Defendant’s

acts constitute unfair and deceptive acts or practices prohibited

by RSA 358-A:2.” Compl. ¶ 3 0 . She has not alleged any facts to

support the bare conclusory statement, which dooms the claim

under the Rule 12(b)(6) standard. See Ashcroft v . Iqbal,

6 2 , 678 (2009).

In addition, CitiMortgage moves to dismiss on the ground

that it is exempt from RSA 358-A because it is subject to the

jurisdiction of the bank commissioner. See RSA 358-A:3; Monzione

v . U.S. Bank, N.A.,

, at *3 (D.N.H. Jan. 2 5 , 2013).

Neenan does not dispute CitiMortgage’s immunity and does not

pursue her claim under RSA 358-A in her objection to the motion

to dismiss.

3. Wrongful Eviction - Count IV

Neenan alleges in Count IV that CitiMortgage wrongfully

evicted her in violation of RSA 540-A:2 and 540-A:3.

CitiMortgage moves to dismiss on the ground that it was not and

is not Neenan’s landlord. In her objection to the motion to

dismiss, Neenan asserts that CitiMortgage “exercised dominion and

control” over her property and should be treated as a landlord

8 under RSA 540-A:2 and that CitiMortgage impermissibly exercised

self-help eviction.

a. Chapter 540-A - Landlord-Tenant

In support of her claim that CitiMortgage wrongfully evicted her in violation of RSA 540-A:2 and RSA 540-A:3, Neenan relies on Case v . S t . Mary’s Bank,

(2013), Evans v . J Four Realty, LLC,

(2013). In Case, the plaintiff was a tenant in a building owned by a landlord who had financed the purchase of the property through two mortgages from S t . Mary’s Bank. Id., 164 N.H. at 651. The bank conducted a foreclosure sale of the property, which was stayed by the landlord’s bankruptcy filing. Id. at 652. The building became uninhabitable due to lack of upkeep; the city prohibited occupancy, and the tenant could no longer live in his apartment. Id. The bank then sold the property at a foreclosure sale. Id. When the tenant returned to his apartment after the sale, the door was open and many of his possessions were missing. Id. The New Hampshire Supreme Court rejected the plaintiff’s claims against the bank, holding that the bank was not the owner of the property and not a landlord, within the meaning of RSA 540-A:1. Id. at 657-58.

9 In this case, no landlord-tenant relationship existed between Neenan and CitiMortgage before the foreclosure sale. Neenan has not alleged facts to support a theory that CitiMortgage was or is her landlord within the meaning of RSA 540-A:1. Neither the analysis nor the holding in Case supports Neenan’s claims here.

Neenan’s reliance on Evans v . J Four Realty, LLC,

(2013), is misplaced for the same reasons. Unlike the plaintiff in Evans, Neenan has not alleged facts to show that she was a tenant in the property sold at the foreclosure sale. In Evans, the plaintiff was a tenant of the property prior to the foreclosure sale and became a tenant at sufferance after the sale.

. The buyer at the foreclosure sale was deemed not to be a landlord within the meaning of RSA chapter 540-A because the plaintiff’s prior lease was with the prior owner.

Neenan has not alleged grounds to support a persuasive theory of wrongful eviction in the circumstances of this case.

b. Impermissible Self-Help Eviction

Although Neenan argues a theory of impermissible self-help

eviction in her objection to CitiMortgage’s motion to dismiss,

she did not allege that claim in her complaint. As a result, she

has not alleged facts to support a claim of wrongful self-help

10 eviction. See RSA 540:12; Evans,

; Greelish v .

Wood,

2 1 , 527 (2006).

4. Conversion - Count V

In support of her conversion claim, Neenan alleges that

CitiMortgage “wrongfully took possession of the Plaintiff’s

personal property with an improper purpose” and “wrongfully took

possession of the Plaintiff’s Premises with an improper purpose.”

CitiMortgage moves to dismiss on the grounds it owns the

“Premises” and that the conversion claim fails as to her personal

property because she had abandoned that property when she did not

remove it and did not notify CitiMortgage that she did not intend

to abandon the property.

Neenan alleges that the Premises were “allegedly” sold at a

foreclosure sale on August 2 7 , 2013, and that the locks were

changed on August 3 0 . She alleges that between August 20 and

September 6, 2013, she made several unsuccessful “attempts to

regain possession of her Premises by telephoning the Defendant

[CitiMortgage].” Compl. ¶ 1 1 . On September 6, 2013,

CitiMortgage allowed her to enter the Premises, and she found

that the utilities had been terminated and “tagged” as if the

Premises was being winterized and that the Premises was reported

as vacant to her insurance company.

11 Neenan further alleges that “[a]t all relevant times [she]

had personal property at the Premises and resided there.” Compl.

¶ 1 4 . She states that she “returned home from work on Friday,

September 2 0 , 2013 to find that all of her personal belongings

had been removed from the Premises.” Compl. ¶ 1 7 . CitiMortgage

told Neenan on September 23 that her personal property had been

taken to the “local Waste Management site.” Compl. ¶ 1 9 . Neenan

has been unable to find her personal property.

“An action for conversion is based on the defendant’s

exercise of dominion or control over goods which is inconsistent

with the rights of the person entitled to immediate possession.”

Rinden v . Hicks,

1 1 , 813 (1979); Riggs v . Peschong,

, at *3 (D.N.H. Mar. 5 , 2009). The party asserting

conversion bears the burden of showing her right to property and

that the defendant’s actions were unlawful. Marcucci v . Hardy,

(1st Cir. 1995). Abandonment or apparent

abandonment is a complete defense to conversion. Rinden,

.

a. Premises

Neenan argues that CitiMortgage had not become the owner of

the Premises when she filed her complaint because it had not

recorded the foreclosure deed and because the state court

12 injunction precludes recording the deed.3 As CitiMortgage points

out, Neenan lost both equitable and legal interest in the

Premises when CitiMortgage bought the property at the foreclosure

sale on August 2 7 , 2013. 4 Barrows v . Boles,

8 2 , 393

(1996). Although legal title to property sold at a foreclosure

sale does not pass to the purchaser until the deed and affidavit

are recorded, RSA 479:26, that requirement does not affect the

former mortgagor’s interest in the foreclosed property. Barrows,

. Therefore, Neenan lost her interest in the

Premises at the foreclosure sale and has not alleged facts to

show that she had any right to the Premises after the sale.

b. Personal Property

Neenan alleges that CitiMortgage is liable in conversion for

the loss of her personal property. CitiMortgage contends that

Neenan abandoned the personal property left in the Premises and

failed to notify CitiMortgage that she did not intend to abandon

the property. Under New Hampshire law, however, “abandonment

3 As noted above and by CitiMortgage in its reply, the state court injunction expired in early October of 2013. 4 The operation of bankruptcy law discussed in In re Beeman,

, 524 (Bankr. D.N.H. 1999), has no effect here when no petition in bankruptcy has been filed. See In re Carbonneau,

(Bankr. D.N.H. 2013).

13 requires ‘both the intent to abandon the [chattel] and an overt

act of abandonment.’” Foley v . Town of Lee,

9 ,

56 (D.N.H. 2012) (quoting New Hampshire v . Elementis Chem., Inc.,

9 4 , 802-03 (2005)).

In response, Neenan states that she did not abandon her

property because she was living at the Premises at the time of

the foreclosure sale and continued to live there “but for being

locked out of her own home.” Despite that statement, it appears

from the allegations in the complaint that Neenan left the

Premises on or before August 20 and did not return to the

Premises until CitiMortgage gave her access on September 6. When

Neenan returned to the Premises on September 6, she found that

the utilities had been turned off and that the Premises had been

reported as vacant to her insurance company. Nevertheless, she

left personal possessions there. When Neenan visited two weeks

later on September 2 0 , she discovered that her personal property

had been removed.5 CitiMortgage does not suggest that it gave

Neenan notice that her personal property would be removed from

the Premises.

Although CitiMortgage’s defense of abandonment may

5 Neenan says that she “returned home from work” that day, although her allegations indicate that she had not lived at the Premises since August 2 0 .

14 ultimately prevail, the claim of conversion of personal property

cannot be resolved on the pleadings. Taking the facts alleged in

the complaint in the light most favorable to Neenan, it is not

clear that Neenan both intended to abandon the property left at

the Premises and that she took an overt act of abandonment. See

Foley,

6 . Therefore, the claim cannot be

dismissed at this stage of the proceedings.

5. Emotional Distress - Counts VI and VII

CitiMortgage moves to dismiss Neenan’s claims for negligent

and intentional infliction of emotional distress on the grounds

that she has not alleged the essential elements of either claim.

In support of negligent infliction of emotional distress, Neenan

states: “The Defendant did commit the above-referenced acts

negligently. [ ] As a direct and proximate cause of the

Defendant’s acts, the Plaintiff has suffered weight-loss,

anxiety, vomiting, sleeplessness, crying, embarrassment,

confusion, depression, pain, anger, confusion and pain.” Compl.

¶¶ 43 & 4 4 . Her intentional infliction of emotional distress

claim is the same except that it alleges that CitiMortgage acted

“intentionally”. In her objection, Neenan simply lists the

elements of a claim of negligent infliction of emotional

distress, without discussion or factual analysis, states that she

15 has alleged the “necessary elements,” and asserts that a claim of

intentional infliction of emotional distress raises a “question

of fact.”

To avoid dismissal under Rule 12(b)(6), a plaintiff must

allege facts to support the claim. She “must articulate ‘more

than labels and conclusions, and a formulaic recitation of the

elements of a cause of action will not do.’” Edlow v . RBW, LLC,

6 , 31 (1st Cir. 2012) (quoting Bell Atl. Corp. v .

Twombly,

4 4 , 555 (2007)).

Neenan does not allege what CitiMortgage did negligently or

intentionally that caused her emotional distress. See Tessier v .

Rockefeller,

2 4 , 342 (2011) (elements of negligent

infliction of emotional distress); id. at 341 (elements of

intentional infliction of emotional distress). In addition, with

respect to her intentional infliction of emotional distress

claim, Neenan fails to provide any facts that would support a

claim of extreme or outrageous conduct. Id. Because Neenan’s

allegations in the complaint provide only conclusory repetition

of the elements of the causes of action, albeit with some facts

about the injuries she claims, she has not sufficiently alleged

claims for infliction of emotional distress to avoid dismissal.

16 Conclusion

For the foregoing reasons, the plaintiff’s motion to remand

(document n o . 7 ) is denied. The defendant’s motion to dismiss

(document n o . 5 ) is granted as to Counts I , I I , I I I , IV, V - as

to conversion of the Premises, V I , and VII. The motion is denied

as to that part of Count V alleging conversion of personal

property. The only claim remaining in the case is for conversion

of personal property.

SO ORDERED.

Joseph A. DiClerico, Jr. United States District Judge

November 2 6 , 2013 cc: William J. Amann, Esquire Katherine Ann Guarino, Esquire Alexander G. Henlin, Esquire John A . Houlihan, Esquire

17