Marques v. JP Morgan Chase Bank

896 S.E.2d 1

MARQUES

v.JP MORGAN CHASE BANK, N.A. et al.

A23A1266

Court of Appeals of Georgia.

November 29, 2023

Review Denied January 9, 2024

Antoinette Marques, for Appellant.

Lisa A. Frank, Norcross, Catherine Gibson, Atlanta, Kane St. John, Marietta, for Appellee.

McFadden, Presiding Judge.

Antoinette Marques appeals the order dismissing her complaint against JP Morgan Chase Bank, N.A., Federal National Mortgage Association ("Fannie Mae"), and Long Tang. We hold that the trial court erred in dismissing Marques’s wrongful foreclosure claim based on Chase’s alleged failure to send a foreclosure notice in compliance with the requirements of OCGA § 44-14-162.2, and we reverse the dismissal of that claim. We affirm the trial court’s order in all other respects.

1. Standard of review, Marques’s allegations, and procedural posture

The trial court dismissed the claims against Tang for insufficient service of process. The court dismissed the claims against Chase and Fannie Mae for failure to state a claim upon which relief may be granted.

[1–4] "When reviewing a ruling on a motion to dismiss for insufficient service, a trial court’s ruling will be upheld on appeal absent a showing of an abuse of discretion." Henderson v. James, 350 Ga. App. 361, 829 S.E.2d 429 (2019) (citation and punctuation omitted). When "reviewing an order on a motion to dismiss [for failure to state a claim upon which relief may be granted, we are] required to take the allegations in the complaint as true and resolve all doubts in favor of the plaintiff." Wise Business Forms v. Forsyth County, — Ga. —, — (2), 893 S.E.2d 32 (2) (2023) (citation and punctuation omitted). Additionally, "[a] copy of any written instrument which is an exhibit to a pleading is a part thereof for all purposes." OCGA § 9-11-10 (c). So "[i]n assessing whether a claim should be dismissed [under OCGA § 9-11-12 (b) (6)], a court may consider exhibits attached to and incorporated into the complaint and answer." Love v. Fulton County Bd. of Tax Assessors, 311 Ga. 682, 683, 859 S.E.2d 33 (2021).

Under OCGA § 9-11-12 (b) (6), a motion to dismiss for failure to state a claim upon which relief can be granted should not besustained unless (1) the allegations of the complaint disclose with certainty that the claimant would not be entitled to relief under any state of provable facts asserted in support thereof; and (2) the movant establishes that the claimant could not possibly introduce evidence within the framework of the complaint sufficient to warrant a grant of the relief sought.

Racette v. Bank of America, 318 Ga. App. 171, 171-172, 733 S.E.2d 457 (2012) (citation and punctuation omitted).

So viewed, Marques alleged the following. Washington Mutual held a security deed on Marques’s property, which it assigned to Chase. Chase foreclosed in January 2020 without first having sent Marques notice of the initiation of foreclosure proceedings by registered or certified mail as required by OCGA § 44-14-162.2.

Chase purchased the property at the foreclosure sale and recorded a deed under power that, according to Marques, contained false statements, including that Chase was a lender; that notice had been given in compliance with OCGA § 44-14-162.2; and that Marques was in default.

Chase transferred title to Fannie Mae, which in turn transferred title to Tang. Tang pursued dispossessory proceedings against Marques. The defendants’ actions caused Marques and her family emotional distress.

Marques alleged that the defendants engaged in a pattern of unfair or deceptive acts and practices in violation of the Uniform Deceptive Trade Practices Act, OCGA §§ 10-1-370 et seq., and the Fair Business Practices Act, OCGA §§ 10-1-390 et seq. She alleged that those acts and practices included Chase failing to provide notice of the foreclosure sale, selling the property while litigation was pending, denying Marques mitigation options, and filing the deed under power containing false information; Fannie Mae registering as a foreign company with the Georgia Secretary of State, failing to maintain a registered agent in Georgia, failing to respond to Marques’s letter requesting proof of the foreclosure, immediately moving to evict her after the foreclosure during the beginning stages of the COVID-19 pandemic, and substituting Tang as a plaintiff in the dispossessory action; and Tang demanding above-market rent, asking for rent for a month that preceded the point he was substituted as a plaintiff in the dispossessory proceeding, violating the rules of evidence in the magistrate court; and failing to provide Marques with notice of the order granting a writ of possession as well as the sheriff's pending removal of her and her property from the premises.

Marques alleged that the defendants violated her privacy, Tang by having Marques and her family forcibly removed from the property, by ringing the doorbell to announce he was the new owner while the case was in litigation, and by claiming in the dispossessory warrant that Marques owed rent for April 2022, when he had not then been substituted as a plaintiff and he had not requested such rent; Chase by publishing documents that falsely stated that Marques was in default; and Fannie Mae by implying that she was not paying rent.

Marques filed suit against the defendants alleging claims for wrongful foreclosure; slander of title; 78 negligent and intentional infliction of emotional distress; violations of the Uniform Deceptive Trade Practices Act and the Fair Business Practices Act; and invasion of privacy. Among other things, Marques sought to set aside the foreclosure and damages.

Tang moved to dismiss the complaint on the ground of insufficiency of service of process, among other grounds. Chase and Fannie Mae jointly moved to dismiss Marques’s complaint under OCGA § 9-11-12 (b) (6) for failing to state a claim.

The trial court granted the defendants’ motions to dismiss. The court dismissed without prejudice Marques’s claims against Tang for failure of service. The court dismissed Marques’s claims against Chase and Fannie Mae with prejudice for failure to state a claim. Marques filed this appeal.

2. Failure to serve Tang

[5] Marques argues that the trial court erred in dismissing her claims against Tang for failure to serve Tang in accordance with OCGA § 9-11-4 because Tang acknowledged service by filing a motion to dismiss; because she served the attorney representing Tang in another case involving Tang and Marques; and because Tang was served the notice of appeal. None of those actions amounts to service of process under OCGA § 9-11-4. So the trial court did not err, and we affirm the dismissal of Tang. See Abba Gana v. Abba, Gana, 251 Ga. 340, 345 (2), 304 S.E.2d 909 (1983) ("an interested party’s actual knowledge of pending proceedings is of no consequence unless he was legally served or waived service"); Gould v. Latorre, 227 Ga. App. 32, 33 (1) (b), 488 S.E.2d 116 (1997) (delivery of complaint to defendant’s attorney was insufficient; where personal service is required, service on individual’s attorney usually is not permitted, particularly when involving service of the very complaint that initiates suit).

3. Failure to state a claim

(а) Wrongful foreclosure

Marques asserted a wrongful foreclosure claim only against Chase. She alleged that Chase’s foreclosure was wrongful because Chase did not hold the note or security deed and because Chase did not comply with the foreclosure notice requirements of OCGA § 44-14-162.2.

(i) Ownership of the note and security deed

[6] The trial court dismissed the wrongful foreclosure claim to the extent it was based on the allegation that Chase did not validly hold the note and deed on the ground that it was barred by res judicata: in a previous proceeding, the trial court had determined that Chase was the valid holder of the security deed; and the United States District Court for the Northern District of Georgia also had established that Chase was the valid holder and that Marques had defaulted on the debt.

[7, 8] Marques argues that res judicata does not apply because the prior cases decided against her were not decided on the merits, but because of her failure to meet deadlines. "Ordinarily the facts necessary to establish the defense of res judicata must be developed upon the trial, but a complaint may be dismissed where it appears that a former adjudication has conclusively foreclosed any issue for trial." Miller v. Columbus, 229 Ga. 234, 235-236 (1), 190 S.E.2d 535 (1972) (citations omitted). And "it is only where the merits were not and could not have been determined under a proper presentation and management of the case that res judicata is not a viable defense. If, pursuant to an appropriate handling of the case, the merits were or could have been determined, then the defense is valid." Piedmont Cotton Mills v. Woelper, 269 Ga. 109, 110, 498 S.E.2d 255 (1998) (emphasis in original). Such is the case here. Marques has not shown that the trial court erred in applying res judicata.

[9] And to the extent Marques bases her wrongful foreclosure claim on the allegation that Chase did not hold the note, which was not explicitly addressed in the prior rulings, she has failed to state a claim. "Under current Georgia law, the holder of a deed to secure debt is authorized to exercise the power of sale in accordance with the terms of the deed even if it does not also hold the note or otherwise have any beneficial interest in the debt obligation underlying the deed." You v. JP Morgan Chase Bank, 293 Ga. 67, 74 (1), 743 S.E.2d 428 (2013).

So the trial court did not err in dismissing Marques’s wrongful foreclosure claim against Chase to the extent it was based on the allegation that Chase did not validly hold the note and deed.

(ii) OCGA § 44-14-162.2

[10] Marques argues that, contrary to the trial court’s ruling, the attachments to the pleadings do not show that foreclosure notice was sent in accordance with the requirements of...