Raymond L. Brown v. Green Tree Servicing LLC
820 F.3d 371
8th Cir.2016Background
- Raymond and Ruth Brown defaulted on their mortgage and received a certified-mail notice of intent to accelerate dated April 29, 2011, requiring cure "on or before May 29, 2011."
- Browns sued Green Tree Servicing LLC to enjoin foreclosure, alleging (1) an invalid assignment left Green Tree without title to the mortgage and (2) the lender failed to comply with Paragraph 22 of the mortgage when giving notice of intent to accelerate.
- The district court dismissed under Fed. R. Civ. P. 12(b)(1) and 12(b)(6): finding no Article III standing to challenge the assignment and that the notice claim failed to state a plausible claim.
- On appeal the Eighth Circuit reviewed standing and the adequacy of the notice de novo and considered the mortgage and attached notice as part of the pleadings.
- The court concluded (a) homeowners lacked standing to challenge an allegedly invalid assignment because any injury from an improper assignment lies with the assignor, and (b) the notice satisfied Paragraph 22: it specified the amount to cure, correctly described reinstatement rights as conditional, and provided the required 30-day period under the mortgage’s mailing rule.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Article III standing to challenge mortgage assignment | Browns: assignment was invalid, so Green Tree lacked authority to foreclose | Green Tree: Browns were not injured by an assignment dispute; only assignor is injured | No standing — Browns cannot challenge assignment; injury not fairly traceable to assignment |
| Notice adequacy under Paragraph 22 (specification of cure) | Notice failed to specify required action to cure because it demanded a sum certain plus unspecified additional charges | Notice identified missed payments and calculated the cure amount as of the notice date; reference to potential future charges did not make it vague | Notice was sufficiently specific — cure amount stated and action to cure was clear |
| Notice adequacy under Paragraph 22 (right to reinstate) | Notice failed to inform Browns of an unconditional right to reinstate | Mortgage itself conditions reinstatement; no unconditional right exists to be disclosed | No deficiency — mortgage imposes conditions on reinstatement, so no unconditional right to disclose |
| Notice timing (30-day requirement) | Mailing on April 29 could not provide a full 30 days because delivery occurs later | Mortgage Paragraph 15 deems notice given when mailed; notice dated April 29 satisfied the 30-day requirement | Timing satisfied — mailing date counts under the mortgage, so 30-day period met |
Key Cases Cited
- Ashcroft v. Iqbal, 556 U.S. 662 (2009) (pleading standard: a complaint must state a plausible claim to relief)
- Bell Atl. Corp. v. Twombly, 550 U.S. 544 (2007) (plausibility standard and limits on conclusory allegations)
- Mattes v. ABC Plastics, Inc., 323 F.3d 695 (8th Cir. 2003) (standard of review for appellate review of dismissal)
- Brown v. Medtronic, Inc., 628 F.3d 451 (8th Cir. 2010) (Article III standing principles)
- Great Plains Trust Co. v. Union Pacific R.R., 492 F.3d 986 (8th Cir. 2007) (court may consider documents attached to a complaint)
- Quale v. Aurora Loan Servs., LLC, [citation="561 F. App'x 582"] (8th Cir. 2014) (homeowners lacked standing to challenge assignment)