Movahedi v. US Bank, N.A.
853 F. Supp. 2d 19
D.D.C.2012Background
- Movahedi owned residential property at 1700 Q Street NW and secured it with a Deed of Trust after borrowing $1,432,750 in May 2005.
- Antique chandeliers and furnishings were installed on the property; plaintiff began leasing in 2010.
- Capital One Bank issued foreclosure notices in 2010; sale notices and short-sale discussions occurred prior to the foreclosure.
- Foreclosure sale occurred on November 23, 2010; Capital One purchased the property for a reserve bid; U.S. Bank later recorded the deed transfer in February 2011.
- Plaintiff sued in September 2011; defendants removed to federal court and moved to dismiss; court granted in part and denied in part.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Wrongful foreclosure validity | Movahedi contends notices/sale improper and invalidates foreclosure. | Defendants contend Capital One (servicer/agent) validly foreclosed under the note. | Claim dismissed; no basis to invalidate sale. |
| Wrongful eviction | Plaintiff alleges eviction without proper quit notice. | Defendants assert non-resident owner not entitled to notice; eviction not wrongful. | Claim dismissed. |
| Conversion of rental payments | Rent collected post-foreclosure unlawfully converted to defendants. | Foreclosure terminates subordinate leases; post-sale rent belongs to new owner. | Claim dismissed. |
| Conversion of furnishings | Chandeliers and furnishings not fixtures; conversion of personal property occurred. | Furnishings are fixtures that transferred with real property. | Claim survives; furnishings not fixtures; conversion viable. |
| Unjust enrichment | Defendants were unjustly enriched by post-foreclosure improvements. | Unjust enrichment not appropriate where contract governs; here post-sale conduct possible. | Claim survives; unjust enrichment viable. |
Key Cases Cited
- National Life Ins. Co. v. Silverman, 454 F.2d 899 (D.C. Cir. 1971) (foreclosure sale price must shock the conscience to be set aside)
- Banks v. E. Sav. Bank, 8 A.3d 1239 (D.C. 2010) (tenants after foreclosure; eviction protections)
- LeRoy Adventures, Inc. v. Cafritz Harbour Grp., Inc., 640 A.2d 193 (D.C. 1994) (fixture analysis; intent governs when attaching furnishings)
- Independence Fed. Sav Bank v. Huntley, 573 A.2d 787 (D.C. 1990) (evidence of conversion of personal property where plaintiff knew of sale)
- Hinton v. Sealander Brokerage Co., 917 A.2d 95 (D.C. 2007) (wrongful eviction standard; act of permanent deprivation)
- O’Callaghan v. District of Columbia, 741 F. Supp. 273 (D.D.C. 1990) (elements of conversion claim for personal property)