UNITED STATES DISTRICT COURT FOR THE DISTRICT OF NEW HAMPSHIRE

Rolling Green at Whip-Poor-Will Condominium Townhouse Unit Owners Association, et al

v. Civil No. 15-cv-391-PB Opinion No.

Bank of America, et al

MEMORANDUM AND ORDER

This case involves an attempt by a condominium association

to recover for damages it suffered after frozen pipes burst in a

vacant condominium unit. The condominium association has sued

Bank of America (“BOA”), the mortgagee for the vacant unit, and

Safeguard Properties, a company BOA hired to oversee the

property. BOA has responded with a motion to dismiss for

failure to state a claim. For the reasons that follow, I deny

BOA’s motion.

I. BACKGROUND1

In 2010, Maria Caporicci purchased a unit (“the Unit”) in

1 The facts here are drawn primarily from Rolling Green’s complaint (Doc. No. 1-1) and are construed in the light most favorable to Rolling Green. See Rivera v. Centro Medico de Turabo, Inc.,

(1st Cir. 2009). the Rolling Green at Whip-Poor-Will Condominium in Hudson, NH.2

Doc. No. 1-1 at 5. Caporicci granted a mortgage secured by the

Unit to the Mortgage Electronic Registration System, Inc., which

later assigned it to BOA. Id. at 6.

In February 2013, Caporicci died, leaving the Unit vacant.

Id. The mortgage loan soon went into default and in September

2013, Rolling Green formally terminated the Unit’s “common area

privileges,” which included access to running water. Id.

Several months later, by May 2014, BOA retained Safeguard

Properties (“Safeguard”) to “monitor” and “exercise . . .

authority and control over” the vacant Unit “on [the bank’s]

behalf,” although BOA had not yet initiated foreclosure

proceedings. Id. at 7, 11. Safeguard posted a notice on the

Unit stating that it was monitoring the Unit at the request of

the “mortgagee.” Id. at 7.

Later in 2014, Rolling Green became concerned that the Unit

would be left unheated over the winter, creating a risk that the

pipes would burst and cause damage to nearby units. Id. at 4.

On November 24, 2014, it sent a letter to BOA’s attorney

expressing its concerns and asking BOA to turn on the heat and

2 The condominium has two governing associations, one for townhouses, and one for condominium units. Both entities are plaintiffs here. Doc. No. 1-1 at 4-5. For the sake of brevity, I refer to both associations as “Rolling Green” in this Memorandum and Order.

2 winterize the Unit immediately. Id. The letter also stated

that BOA would be held responsible for any damage caused by its

negligence, and reminded BOA that its common area privileges had

been terminated. Id.

On the same day, November 24, 2014, Rolling Green also

wrote to Caporicci’s estate, requesting permission to take

“custody and control” of the Unit until BOA foreclosed. Id.

The administrator of Caporicci’s estate agreed, and a copy of

the estate’s authorization of custody and control was sent to

BOA and Safeguard. Id. at 8. About a week later, on December

3, 2014, Rolling Green members entered the Unit and found that

the heat was turned off but the water remained on. Id. Rolling

Green drained the water lines and attempted to turn the heat on,

but discovered an issue that prevented them from doing so. Id.

It then notified BOA’s attorney that a plumber needed to be

called to turn on the heat. Id. Later that month, on December

12, 2014, Safeguard employees entered the Unit, changed the

locks, and turned the water on – but failed to fix or turn on

the heat. Id. Safeguard did not notify Rolling Green of its

actions. Id.

A month later, on January 9, 2015, the pipes burst in the

Unit. Id. at 9. Rolling Green’s property management company

received a call from the owner of a neighboring unit complaining

3 that water was flooding into his condo. Id. The company went

to the Unit, but had to cut the locks to gain entry. Id. Upon

arrival, they discovered that the water had been turned on and

the water lines had frozen and ruptured, causing the flooding.

Id. The boiler in the building had also cracked and exploded,

and the floor in the Unit was sagging. Id. Making matters

worse, the pipes serving the building’s shared sprinkler system

failed soon after, and the system was rendered inoperable. Id.

The Hudson Fire Department later examined the damage and

concluded that the building might collapse. Id. As a result,

the other unit owners in the building had to be temporarily

relocated. Id.

Rolling Green bore the cost of the repairs to the sprinkler

system and the common areas, receiving an estimate of $83,800

for the sprinkler alone. Id. Rolling Green informed Safeguard

of the damage, and although Safeguard initially indicated that

it would send a crew to estimate the damages, it never got back

to Rolling Green. Id. at 10. BOA, meanwhile, refused to accept

a deed in lieu of foreclosure from Caporicci’s estate. Id.

Instead, it scheduled a foreclosure sale for September 1, 2015,

but left the repair costs to Rolling Green. Id. at 10-11.

On September 23, 2015, Rolling Green brought suit for

negligence, trespass, and conversion against BOA and Safeguard

4 in a New Hampshire state court. BOA removed the case to this

court, and responded with the present motion to dismiss for

failure to state a claim under Rule 12(b)(6). Safeguard filed

an answer and has not joined in BOA’s motion to dismiss.

II. STANDARD OF REVIEW

To survive a Rule 12(b)(6) motion, a plaintiff must allege

sufficient facts to “state a claim to relief that is plausible

on its face.” Ashcroft v. Iqbal,

(2009)

(quoting Bell Atl. Corp. v. Twombly,

(2007).

A claim is facially plausible if it provides “factual content

that allows the court to draw the reasonable inference that the

defendant is liable for the misconduct alleged.”

This

plausibility standard “asks for more than a sheer possibility

that a defendant has acted unlawfully,”

but “simply calls

for enough fact to raise a reasonable expectation that discovery

will reveal evidence” of wrongdoing. Twombly,

.

I employ a two-step approach in deciding a Rule 12(b)(6)

motion. See Ocasio-Hernandez v. Fortuno-Burset,

(1st Cir. 2011). First, I screen the complaint for statements

that “merely offer legal conclusions couched as fact or

threadbare recitals of the elements of a cause of action.”

(citations, internal punctuation, and alterations omitted). I

5 then accept as true all non-conclusory factual allegations and

the reasonable inferences drawn from them, and determine whether

the claim is plausible.

III. ANALYSIS

BOA does not challenge the sufficiency of Rolling Green’s

claims that Safeguard trespassed on common areas in the

condominium, converted water that belonged to the condominium

association, and negligently caused the pipes in the Unit to

burst. Instead, it argues that dismissal is required because

Rolling Green has failed to allege sufficient facts to support

its claim that BOA can be held liable for Safeguard’s tortious

acts. I am unpersuaded by BOA’s argument.

Rolling Green alleges that BOA had a right under the

mortgage to “take reasonable measures to preserve and protect”

the Unit “in the event that it became vacant or abandoned.”

Doc. No. 1-1 at 3. It claims that BOA actually exercised

control over the Unit and retained Safeguard to act as its agent

in exercising that control.

. Further, it asserts

that Safeguard was acting as BOA’s agent when it accessed common

areas in the condominium without permission, converted water

belonging to Rolling Green without permission, and caused the

pipes to burst in the Unit by turning on the water to the Unit

6 during the winter even though it was unheated.

, 11-

12. Finally, it alleges that BOA knew or should have known

that: (1) neither Safeguard nor BOA was authorized to access

common areas in the condominium; (2) neither defendant was

authorized to use the condominium’s water; and (3) turning the

water to the Unit on while it was unheated and changing the

locks on the Unit presented an unreasonable risk that the pipes

in the Unit would freeze and burst.

, 5 and 8.

When these facts are viewed in the light most favorable to

Rolling Green, they are sufficient to state a plausible claim

that BOA can be held liable for Safeguard’s tortious acts under

basic principles of tort and agency law. See, e.g., Restatement

(Third) of Agency § 7.04; Restatement (Second) of Torts §

877(d). Accordingly, I deny BOA’s motion to dismiss without

prejudice to its right to renew its argument in a motion for

summary judgment after discovery has been completed.3

IV. CONCLUSION

For the reasons stated, BOA’s motion to dismiss (Doc. No.

3 Because I deny the motion to dismiss on basic tort and agency principles, I need not determine whether BOA can be held liable on any of Rolling Green’s claims as a mortgagee in possession of the Unit. See Case v. St. Mary’s Bank,

(2013) (describing mortgagee in possession doctrine).

7 10) is denied.

SO ORDERED.

/s/Paul Barbadoro Paul Barbadoro United States District Judge

March 4, 2016

cc: Daniel D. Muller, Jr. Thomas J. Pappas Christopher P. Flanagan Marissa Tripolsky

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