Diaz-Amador v. Wells Fargo Home Mortgage Incorporated
4:11-cv-00243
D. Ariz.Feb 7, 2012Background
- This is a United States District Court case in the District of Arizona removed from state court; Wells Fargo Bank, N.A. is defendant, with WFHM referenced in the pleadings.
- Plaintiffs Diaz-Amador and Diaz assert four counts: Contract (Count One), Breach of A.R.S. §33-813 (Count Two), Reformation (Count Three), and Injunction (Count Four).
- Plaintiffs allege a 2002 promissory note and deed of trust securing $135,751; a trustee sale notice issued for Feb. 25, 2011; Plaintiffs offered a loan modification with a lien on two adjoining lots; sale was postponed temporarily but ultimately proceeded on Feb. 25, 2011.
- Plaintiffs claim an oral promise by WFHM to postpone the sale and enable a modification; Defendants allegedly postponed the sale only to investigate the modification but did not agree to the proposed modification.
- The Magistrate Judge recommends partial grant and partial denial of Wells Fargo’s motion to dismiss, and leave to amend the FAC.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Contract claim viability | Diaz argues an executory accord formed; misrep promise induced reliance. | No enforceable executory accord; statute of frauds and lack of consideration. | Count One dismissed; promissory estoppel not pled adequately; leave to amend. |
| Count Two viability under §33-813 | Reinstatement rights were deprived by sale proceeding. | No standalone cause of action for deprivation of reinstatement rights; §33-813(E) involves damages only on reinstatement. | Count Two dismissed as duplicative of promissory estoppel theory; not a standalone contract claim. |
| Reformation claim viability | Request for reformation of the trustee's deed. | Reformation is a remedy, not an independent cause of action. | Count Three dismissed. |
| Injunction claim viability | Request for injunctive relief against forcible detainer. | Injunction is a remedy, not an independent cause of action. | Count Four dismissed. |
| Leave to amend the complaint | Leave to amend granted; dismissal without prejudice to permit amendment. |
Key Cases Cited
- Twombly v. Bell Atl. Corp., 550 U.S. 544 (U.S. 2007) (pleadings must contain plausible factual content for relief)
- Iqbal v. Ashcroft, 556 U.S. 662 (U.S. 2009) (plaintiffs' legal conclusions not entitled to be taken as true; plausibility standard)
- Moss v. United States Secret Serv., 572 F.3d 962 (9th Cir. 2009) (non-conclusory factual content plausibly suggests a claim)
- Telasaurus VPC, LLC v. Power, 623 F.3d 998 (9th Cir. 2010) (pleading standards; plausible claim required)
- Rossi v. Stewart, 90 Ariz. 207, 367 P.2d 242 (Ariz. 1961) (elements of accord and satisfaction; consideration required)
- Chewning v. Palmer, 133 Ariz. 136, 650 P.2d 440 (Ariz. 1982) (promissory estoppel origin; need for specific pleadings)
- Johnson Int’l., Inc. v. City of Phoenix, 192 Ariz. 466, 967 P.2d 607 (Ariz. Ct. App. 1998) (promissory estoppel requirements; reliance specific pleadings)
- Healy v. Coury, 162 Ariz. 349, 783 P.2d 795 (Ariz. App. 1989) (statute of frauds exceptions where performance within one year)
- Chaparral Dev. v. RMED Int’l., Inc., 170 Ariz. 308, 823 P.2d 1317 (Ariz. Ct. App. 1992) (reformation standards; mutual mistake vs unilateral; equitable relief)
- Patton v. First Fed. Sav. & Loan Assoc., 118 Ariz. 473, 578 P.2d 152 (Ariz. 1978) ( Deed of trust protections; strict construction in borrowers' favor)
- Best v. Edwards, 217 Ariz. 497, 176 P.3d 695 (Ariz. Ct. App. 2008) (statutory modification of mortgage terms; statute of frauds analysis)
- Executive Towers v. Leonard, 7 Ariz. App. 331, 439 P.2d 303 (Ariz. Ct. App. 1968) (modification/interpretation of mortgage terms; contract mechanics)