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Brian Thiel v. Gmac Mortgage

January 26, 2011

BRIAN THIEL,
PLAINTIFF,
v.
GMAC MORTGAGE, LLC AND DOES 1 THROUGH 100, INCLUSIVE DEFENDANTS.



The opinion of the court was delivered by: Morrison C. England, Jr. United States District Judge

MEMORANDUM AND ORDER

Presently before the Court is a Motion by Defendant GMAC Mortage, LLC ("Defendant") to dismiss the claims alleged in Plaintiff Brian Thiel's ("Plaintiff") Second Amended Complaint for failure to state a claim upon which relief may be granted pursuant to Federal Rule of Civil Procedure Rule of 12(b)(6)*fn1 .

For the reasons set forth below, Defendant's Motion is granted.

BACKGROUND*fn2

Plaintiff entered into a mortgage loan transaction to purchase his home in Pleasant Grove, California. In December 2008, Plaintiff contacted Defendant to request a loan modification or mortgage refinance. In January 2009, Plaintiff was notified by one of Defendant's telephone representatives that a loan modification would only be granted once Plaintiff was in default on his mortgage loan.

Based on Defendant's statement and subsequent phone conversations, Plaintiff purposefully withheld payments on his loan, although, on his own admission, he financially could have made the payments. In May 2009, Defendant informed Plaintiff that his loan would not be modified because he was behind on his payments and his monthly income was too high. After subsequent attempts to modify his loan proved futile, Plaintiff filed the instant suit.

STANDARD

On a motion to dismiss for failure to state a claim under Rule 12(b)(6), all allegations of material fact must be accepted as true and construed in the light most favorable to the nonmoving party. Cahill v. Liberty Mut. Ins. Co., 80 F.3d 336, 337-38 (9th Cir. 1996).

Rule 8(a)(2) requires only "a short and plain statement of the claim showing that the pleader is entitled to relief," to "give the defendant fair notice of what the...claim is and the grounds upon which it rests." Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007) (internal citations and quotations omitted). Though "a complaint attacked by a Rule 12(b)(6) motion" need not contain "detailed factual allegations, a plaintiff's obligation to provide the 'grounds' of his 'entitlement to relief' requires more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do." Id. at 555 (quoting Papasan v. Allain, 478 U.S. 265, 2869 (1986)). A plaintiff's "factual allegations must be enough to raise a right to relief above the speculative level." Id. (citing 5 C. Wright & A. Miller, Federal Practice and Procedure § 1216 (3d ed. 2004) ("[T]he pleading must contain something more...than...a statement of facts that merely creates a suspicion [of] a legally cognizable right of action.")).

Once the court grants a motion to dismiss, they must then decide whether to grant a plaintiff leave to amend. Rule 15(a) authorizes the court to freely grant leave to amend when there is no "undue delay, bad faith, or dilatory motive on the part of the movant." Foman v. Davis, 371 U.S. 178, 182 (1962). In fact, leave to amend is generally only denied when it is clear that the deficiencies of the complaint cannot possibly be cured by an amended version. See DeSoto v. Yellow Freight Sys., Inc., 957 F.2d 655, 658 (9th Cir. 1992); Balistieri v. Pacifica Police Dept., 901 F. 2d 696, 699 (9th Cir. 1990) ("A complaint should not be dismissed under Rule 12(b)(6) unless it appears beyond doubt that the plaintiff can prove no set of facts in support of his claim which would entitle him to relief.")(internal citations omitted).

ANALYSIS

A. Breach of Contract

Plaintiff argues that some form of contract was formed by Defendant's phone representatives promising to issue a loan modification if he stopped making the payments and became in arrears. Plaintiff contends he reasonably relied on the promise, and but for their statements, would not be in danger of losing his home.

To prove a breach of contract claim, a plaintiff must show "the contract, his performance or excuse of nonperformance," defendant's breach, and the resulting damages. Otworth v. S. ...


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