Gary Brian Plunkitt v. DLJ Mortgage Capital Inc. (mem. dec.)
32A01-1605-MF-951
| Ind. Ct. App. | Jul 13, 2017Background
- In 2006 Plunkitt executed two promissory notes and mortgages (first: Instrument 720; second: Instrument 1500) secured by a Hendricks County residence; he defaulted in 2007.
- CIT initiated foreclosure, later substituted Aurora Loan Services as plaintiff; litigation revealed undated/allonge endorsements produced late in the case.
- Trial court struck the allonges, granted Defendants’ T.R. 12(B)(6) motion and dismissed Aurora’s complaint; this Court affirmed (Aurora II).
- Aurora later dissolved; DLJ was later substituted as plaintiff and filed an Affidavit Regarding Lost or Misplaced Assignment that Plunkitt claimed clouded title.
- Plunkitt sought attorney fees and filed a cross-complaint to quiet title in the dismissed foreclosure action; the trial court denied fees and dismissed the quiet-title cross-complaint as improperly filed, untimely, and not the correct venue.
- On appeal Plunkitt challenged the denial of attorney fees (arguing bad faith and vicarious liability of U.S. Bank) and the dismissal of his quiet-title cross-complaint.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether trial court abused its discretion denying attorney fees | Plunkitt: foreclosure claims were frivolous/unreasonable; fees appropriate under I.C. §34-52-1-1 | DLJ/U.S. Bank: U.S. Bank never named plaintiff and not responsible for initiating the action | Court: No abuse of discretion; no evidence U.S. Bank initiated or directed actions; American Rule applies |
| Whether U.S. Bank can be held vicariously liable for fees as trustee | Plunkitt: Aurora acted as servicer/agent for U.S. Bank, so U.S. Bank is liable | Opposing: No record evidence of U.S. Bank directing foreclosure; it didn’t appear in action | Court: No evidence supporting vicarious liability; denial affirmed |
| Whether striking allonges compelled fee award | Plunkitt: striking allonges shows foreclosure was groundless, supporting fees | Defense: Striking was procedural based on late production, not a substantive finding of groundlessness | Court: Striking was procedural; does not automatically warrant fees |
| Whether the quiet-title cross-complaint was properly filed in the dismissed foreclosure case | Plunkitt: Gave notice of intent and could file cross-complaint post-appeal | DLJ: Action was finalized after appeal; cross-complaint was untimely, improper venue, and should be dismissed under T.R.12(F)/(B) | Court: Dismissal affirmed — matter finalized; cross-complaint not properly filed in that case and Plunkitt may file a new action elsewhere |
Key Cases Cited
- Delgado v. Boyles, 922 N.E.2d 1267 (Ind. Ct. App. 2010) (abuse-of-discretion standard for attorney-fee rulings)
- Carter-McMahon v. McMahon, 815 N.E.2d 170 (Ind. Ct. App. 2004) (trial court discretion in awarding fees)
- Smyth v. Hester, 901 N.E.2d 25 (Ind. Ct. App. 2009) (American Rule; fees require agreement, statute, or bad-faith/frivolous claim)
- Cua v. Ramos, 433 N.E.2d 745 (Ind. 1982) (standard for reviewing motions to strike pleadings)
- Anderson v. Anderson, 399 N.E.2d 391 (Ind. Ct. App. 1979) (T.R.12(F) can be used to attack sufficiency of a complaint)